Property Purchase: What does tenants in common & joint tenants ownership means?

In UK property purchase in spite of the word ‘tenants’, this has nothing to do with renting the property. It’s all to do with what happens if one of the property owner dies.

Joint tenants – If your names are written on the deeds as ‘joint tenants’ then if one of you dies the other one (the survivor) gets the whole of the property straight away.

Tenants in common – If your names are written on the deeds as ‘tenants in common’ then if one of you dies, the will is examined to see what should happen to their share. If there is no will, there are rules about this and they should be followed. Tenants in common is usually used where either party has children by a previous relationship and wants to make sure that on their death, their share of the house goes to their children.

If one person is putting more than the other then as tenants in common you can hold it in unequal shares for example 70 per cent to one, 30 per cent to the other. However in this case you should consider drawing up a Trust Deed as well to protect your interest. It is best to seek professional and legal advice.

 

 

For property investment in the UK from start to finish, Please Contact me

Dennis Bebo – MSC, BSC, DEA, CeMAP

TA DenEco Consultancy – www.deneco.co.uk

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First time buyers on a 12 year high

First-time buyer numbers have soared to a 12-year high, reaching a level last seen before the financial crisis struck.

A total of 35,010 mortgages were advanced to people buying their first home in August – the highest monthly total since August 2007, according to UK Finance.

The typical first-time buyer borrowed £175,361, the equivalent of 80% of their property’s value.

Although the sum was an average of 3.52 times their pay, close to record-low interest rates meant monthly mortgage payments accounted for just 17.1% of their total household income.

The data from UK Finance supports Zoopla research which found that more than a third (36%) of all property purchases in 2018 were made by first-time buyers and that numbers were up by a huge 85% since 2010.

Buying a home for the first time can be daunting and expensive, which is why it’s important to get fully up to speed before you start your property search. Once your name is on the property deeds, you’ll benefit from potential equity gains, you can decorate how you like and of course you’ll always have something to call your own.

Source: Zoopla property News

For property investment in the UK from start to finish, Please Contact me

Dennis Bebo – MSC, BSC, DEA, CeMAP

TA DenEco Consultancy – www.deneco.co.uk

Property Purchase: What exactly is gazumping

The term gazumping is often use by the media but generally don’t paint a full picture of what actually happens and as such many often find it surprising and confusing to understand.

Gazumping is where a property sale has been agreed but contract not yet exchanged and a third party comes along and offers more – where a third party ‘gazumps’ the original buyer. Gazumping is a nightmare for the original buyer as they’ve no comeback against (even if a survey has been done) either of the other two parties. In other for it to happen the seller must have to accept the higher offer, although they don’t have to.

I have worked for  clients on cases where a seller received higher offers but stuck to the original because they felt it was the honourable thing to do or preferred the original buyer. Also I have worked on cases where gazumping saved the chain – the original buyer was not taking it seriously or experiencing delays in securing mortgage and the chain was about to fall through – the new buyer moved ahead quickly and the whole chain completed. Gazumping normally occurs more often in a rising housing market, but probably not as much as the media would have you believe.

For property investment in the UK from start to finish, Please Contact me

Dennis Bebo – MSC, BSC, DEA, CeMAP

TA DenEco Consultancy – www.deneco.co.uk

Help to Buy ISA ends this Month 30 Nov 2019; Act fast starts from £1 deposit

Time is running out for first-time buyers who want to get on the property ladder with a help-to-buy ISA (H2B).

The Government-led scheme gives youngsters between the age of 16 to 40 a 25 per cent bonus to help them buy their first home, and you can start up an account with as little as £1.

If you want to benefit from the scheme you’ll have to act quickly, as the application deadline falls on 30 November – giving prospective account-holders just a month to make a deposit.

Once the deadline passes, the H2B scheme will be replaced by the Lifetime ISA (LISA).

While you can have both accounts open at the same time, you’ll only be able to get the 25% homeowner’s bonus on one.

It’s important to weigh up the pros and cons of both accounts before making a decision on which to use. For more information contact your bank or an independent advisor.

For property investment in the UK from start to finish, Please Contact me

Dennis Bebo – MSC, BSC, DEA, CeMAP

TA DenEco Consultancy – www.deneco.co.uk

Buying a property: Do I need a survey?

The Key to a happy home purchase is knowing what you are buying. Estate agents and mortgage advisers won’t tell you if you need a survey or not. It is not their job to tell you what advice you need to get before buying. It is up to yo to make seek professional advice.

All you need to know about survey;

A property survey is a detailed inspection of a property’s condition. The surveyor inspects the property and tells you if there are structural problems like unstable walls or subsidence. They will highlight any major repairs or alterations needed, such as fixing the roof or chimney chute. The amount of details that shows up in a survey will depend on the type of survey you chose. The minimum requirement for mortgage lenders is generally a valuation – this basic report merely confirms the price is right and that the property is adequate security for a loan. This is not a survey.

The next level up is HomeBuyer’s Report, which will tell you of major issues that could affect the value of the property. and may advise more specialist reports need to be carried out for woodworm or damp, for example. The most comprehensive report is a building survey, which involves an in-depth assessment of the house and should uncover any issues that are likely to need your attention, including the need for more special reports.

Surveys are a key part of the buying process and can potentially make or break a deal. You shouldn’t underestimate the importance as your property survey will highlight any issues in the house before you legally purchase it.  Often in most cases the buyer would negotiate with the vendor to reduce the price of the property by the amount required to fix the issues identified in the survey.

For property investment in the UK from start to finish, Please Contact me

Dennis Bebo – MSC, BSC, DEA, CeMAP

TA DenEco Consultancy – www.deneco.co.uk

 

Renting a property in the UK: Using an agent or going it alone?

Renting a property in the UK required a great deal of  time and money. If you don’t have the time and experience, it’s advisable to use an agent.  If you do have time and experience the extra effort and expense should help to maximise the eventual rental income.

 

 

There are a number of things you will need to take into consideration before tenants move in and the rent payments lands in your bank account.

Good condition

Firstly, you need to ensure that the property is in good condition. Try and put yourself in a tenant’s shoes – if you were searching for a house to rent and you came to have a look around this property, what would be your first impression? If your property is well-maintained and looks in good condition, it will be easier to rent out at a good rental price.

Safety first

Beyond first impressions, there are some safety checks you are legally required to complete before you rent out your property. You must have a gas-safety inspection carried out by a Gas Safe Register accredited engineer. All electrical appliances must also be checked and certified as safe. All upholstered furniture must be passed as fireproof, and must have a sewn-in label attesting to this. Any upholstered furniture that does not have this label should be removed from the property before tenants move in. Landlords are also required by law to have an Energy Performance Certificate (EPC). This must be carried out by a domestic energy assessor, who will assess the energy efficiency of the property.

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Using an agent

If you choice to use a lettings agent to rent out your property, they will do so for a fee of around 10 per cent of the annual rent. They will market your property and bring prospective tenants round to view it. Once they have found tenants for you, their involvement stops, unless you ask them to manage the property for you. They will usually charge a fee of around five per cent of the annual tent for this. this means that tenants will deal directly with the agents on any issues relating to the property – from repairs to giving notice.  Always get at least three different letting agent to give you an estimate of how much you can rent your property for, what fees they charge and what services they offer before choosing the on that best suit you. The main benefit of renting your property through an agent is that they will do all the work for you.

Going it alone

For those who have the time and experience of finding tenants themselves and working out their own arrangements for managing the property, then there is nothing to stop you from renting it out independently. Doing this will save you money and give you more control over not only who the tenants are, but also the tradespeople you allow into the property. The reality is that it is the good properties that are easiest to rent independently. Tenants tend to go for the ones that are fairly priced, well maintained, close to public transport and well described. Avoid wrong and over the top description of the property, it’s just a waste of everyone’s time.

Finding tenants  

When people come to view your property, it is helpful to have someone else with you to get a second opinion on the prospective tenant and also for safety reasons. To save time it’s sensible to have several people come to view at the same time, it also add a feeling of competition within the prospective tenants to act fast. When you have found tenants for your property, make sure you have sufficient information about them so you can assess the risk in accepting the tenancy. This means checking bank statements, as well as taking out full credit history on a tenant. You should also check their current and previous employment status, as well as their renting history and references. If you find the tenants yourself, but are unable to manage the property once they moved in, you can employ a managing agent to do that for you.

The financial side

Whether you rent your property through an agent or independently, you must be realistic about money. When budgeting and setting the rent, landlords are generally advised to factor in eight weeks a year for the property to be empty. If the times between rental periods are less than this then the extra revenue can be viewed as bonus. You should also take out specialist building and contents insurance such as landlord insurance, as without a specific reference to letting in your policy you may be uninsured. Also, consider insuring against the tenant defaulting. This normally covers both rent and legal expenses. You most also inform your mortgage lender that you will be renting out your house otherwise it might render your mortgage invalid. Similarly you are required to register your rental income for tax purposes. It is mandatory for landlords to comply with the Tenancy Deposit Scheme (TDS) legislation. which requires all deposits to be registered with (and in some cases held by) a government – approved scheme.

The Legal side

A tenancy agreement is required as a legal contract. if you are letting through an agency, the agent will draw up a contract for the period of the tenancy, but if you are letting it independently you will need to draw out your own contract with the tenants. You can download contracts from the internet or buy them off the shelf from shops such as WH Smith, but this is not recommended. It is advisable to seek legal advice before entering into any contractual agreements. Make sure you also prepare a full, detailed inventory of the property. This should include the condition of all contents, as well as walls, ceilings, doors and fixtures and fittings – to make sure there is no surprise claims.

Finally, it’s very important to provide good level of service to your tenant to hold onto them for as long as possible. If they are unhappy with the service you provide they will leave. As a landlord, you are essentially a caretaker, and you will need to make sure that maintenance work is being carried out as when required, whether you arrange it yourself or paying an agent to do it.

For property investment in the UK from start to finish, Please Contact me

Dennis Bebo – MSC, BSC, DEA, CeMAP

TA DenEco Consultancy – www.deneco.co.uk

UK Finance survey shows UK mortgage approvals hit 6 month low

The number of new mortgages approved by British banks hit a six-month low in September, according to a survey that adds to signs the housing market is slowing again ahead of the October Brexit deadline.

 

Industry body UK Finance said banks approved 42,310 loans for home purchase in September, compared with 42,527 in August, according to seasonally-adjusted data. However, the number of approvals for remortgaging rose to the highest level since November 2017 at 32,649.

UK Finance said annual growth in consumer credit rose to a 19-month high of 4.5%, driven by personal loans and overdrafts rather than credit card lending.

Source: Reuters