From the category archives:

North Devon

Grass keep still popular

03/05/2012

Caroline Snell, of Stags Professional Services at Honiton in Devon comments “With the lack of spring rain, competitive demand for farmland to rent and increasing land values supported by good commodity prices, the demand for grass keep remains strong”.

Many grass keep licences are based on a ‘Gentleman’s Agreement’, often between farming neighbours and run without a problem. However, if relationships break down or the landowner passes away, a lack of written agreement can become an issue.

“For inheritance tax purposes it is important to have a correctly set up written agreement to ensure that Agricultural Property Relief (APR) on the land, farmhouse and buildings is not forfeited” explains Caroline. “The onus is on the taxpayer to prove what sort of agreement was in place at the date of death and where there is no agreement, or the obligations of each party do not satisfy the criteria of obtaining APR, this can prove to be financially crippling to the landowner.

Setting up a written agreement ensures that the terms are clear to both parties including maintenance obligations, rental levels and the requirements of any environmental stewardship schemes that may be in place, and ensures the Licensee does not claim entitlement to the Single Payment.

Under a Gentleman’s Agreement, rent levels are often below the market value and do not get reviewed from year to year. “The auction room remains the best place to get a competitive price for grass keep” states Andrew Luxton, Stags Partner and Auctioneer, having recently sold grass keep in theEast Devonarea for over £160/acre.

Caroline adds “The cost of drawing up a Licence or Tenancy Agreement prior to occupation is minimal when you consider the ‘bigger picture’ with respect to claiming APR on your property”. In addition, these agreements can be renewed relatively quickly should the occupation continue beyond the initial term.”

If you would like advice regarding rental levels and/or assistance in tenancy negotiations, please contact Stags Professional Services on 01392 439046 (for Devon, Somerset or Dorset) or 01872 279911 (forCornwall), where you will be transferred to the surveyor in your area.

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End of stamp duty holiday encourages South West first time buyers

14/02/2012

in East Devon,North Devon,Somerset

UK Housing Market Survey House sales in the South West edged up slightly during January as an increased number of first time buyers looked to beat the stamp duty holiday, which expires in March, says the latest RICS UK Housing Market survey (14 February 2012).

15 per cent more surveyors in the region reported rises rather than falls in newly agreed sales since the beginning of the year. From March 24, first time buyers will no longer be exempt from stamp duty on properties under £250,000 and some surveyors note this has produced an increase in activity at the lower end of the market. In light of this, respondents were optimistic about prospects in the near term, as a net balance of 34 per cent of surveyors predicted transaction levels to pick up over the coming three months. This represents the strongest reading since August 2011.

In spite of this relative optimism, prices across the region continued to drop, with 37 per cent more surveyors reporting price falls rather than rises. Across the UK, London once again saw the strongest reading in terms of prices, while the West Midlands and Wales saw the biggest falls, with surveyors reporting net balance readings of -54 and -41 respectively.

Supply remained relatively steady during January, with 15 per cent more surveyors reporting increases rather than decreases in new homes coming onto the market. This is the third consecutive positive reading for new instructions in the region. Alongside this, overall new buyer demand dipped slightly in the first month of the year, demonstrating that the recent lift in activity has been driven by one-off factors, with 14 per cent more respondents in the South West reporting falls rather than rises in new buyer enquiries.

Despite a relative upturn in interest from some first time buyers prior to the end of the stamp duty holiday, surveyors report that lack of affordable mortgage finance continues to hold back the market. Looking ahead, while a cautious optimism surrounds future transaction levels, the same cannot be said for future prices.

A net balance of 33 per cent more surveyors expect prices in the region to continue falling over the coming three months.

Michael Newey, RICS housing spokesperson, commented: “With first time buyers no longer exempt from stamp duty as of the end of March, it seems that some are looking to purchase homes before the deadline and, as a result, surveyors are relatively optimistic for the coming months. However, many problems with the market still exist and the lack of affordable mortgage finance is still preventing many from getting onto the property ladder.

“Prices are still falling across the region, and expectations for future prices are also rather subdued.”

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Gary Langdale of A1 Home Inspectors Answers some Common EPC Questions

06/02/2012

in North Devon,Somerset

Q. What is the purpose of an EPC?

A. An EPC is designed to provide potential purchasers or tenants with an idea of their likely heating costs plus recommendations that could be done to the property to reduce those costs.

Q. What does an Assessor look at?

A. About 50 different things, but they all fall into one of five categories. The five areas of the property assessed are: Construction, Size, Heating, Lighting and Insulation.

Q. Does the Assessor test anything?

A. No, there is not testing, everything is calculated by measurement and observation and nothing need be working during the assessment.

Q. What if my property fails?

A. There is no Pass or Fail, only a rating letter between ‘A’ and ‘G’.

Q. What rating letter can I expect for my property?

A. The white goods in a kitchen score very highly, but in general, properties do not. A brief description for each letter would be as follows:

‘A’ – extraordinary and modern, Eco-friendly properties that would have a wind turbine, a heat exchanger, solar panels and photo-voltaic panels. An ‘A’ rating is exceptionally rare and not to be expected.

‘B’ – very rare. Most new builds will achieve a ‘B’ rating but very few others. The only type of property returning to the housing or rental market that might achieve a ‘B’ rating would be one that is well insulated by other properties. This would include small, modern mid-terraced properties or modern mid-floor flats.

‘C’ – an excellent score that reflects very efficient heating and insulation.

‘D’ – a good score showing that the combination of heating and insulation is adequate. Highly efficient heating mechanisms are often compensating for uninsulated walls in a ‘D’ rated property.

‘E’ – the national average that will probably reflect a property with uninsulated walls and adequate heating, or a property with insulated walls and inefficient heating.

‘F’ - a lower score that reflects a combination of inefficient heating and poor insulation.

‘G’ - the lowest score the reflects both extremely poor heating and inadequate insulation. This will be a combination of solid or uninsulated cavity walls along with single glazing and probably electric heating.

A1 Home Inspectors

Flat 4, 56 Knightstone Road

Weston-super-Mare

North Somerset BS23 2BE

T 01934 644062 M 07837 193476

E info@A1-homeinspectors.co.uk

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Outlook for South West commercial property hit by economic uncertainty

17/01/2012

in East Devon,North Devon,Somerset

Falling occupier demand and flat availability in the South West drove down commercial property rental expectations in the final quarter of 2011, says the RICS UK Commercial Market Survey (January 11, 2012).

Overall tenant demand continued to fall in the final three months of the year, with 12 per cent more surveyors reporting decreases rather than increases in interest from prospective tenants.

With demand falling back, overall availability remained flat with a net balance of one per cent of chartered surveyors reporting increases in vacant floor space. Retail and office space saw the most increases with net balances of +10 and +9 per cent of surveyors reporting increases, while industrial space saw available space fall back (net balance -13).

Falling demand and flat availability continued to impact on overall rental expectations which weakened over the quarter, moving further into negative territory (-36 per cent). This trend was visible in all parts of the UK with the headline rent expectations net balance even in London recording a negative result.

Perhaps unsurprisingly, inducements continued to increase in the three months to December as landlords attempted to attract potential tenants. 22 per cent more respondents reported rises rather than falls in incentive packages. Surveyors across the country report that in this difficult market, many would-be occupiers are requesting reductions in rent and higher inducements.

Nationally, against a backdrop of increasing economic uncertainty and continued constraints on bank funding investors appear to have become a little more cautious with a drop in enquiries in the final part of last year likely to translate to a lower level of activity in the early part of 2012. Capital value expectations have also eased with a more negative view of the prospects being taken in all three sectors.

Simon Rubinsohn, RICS Chief Economist, said:

“Rental expectations in the South West have predictably become a little more negative in the face of the recent run of grim economic news. While this seems to be the case across almost all of the UK the one area that continues to buck the trend is prime London offices. However even here our indicators suggest that demand for space is a little less strong than it was.

“Meanwhile, the on-going shortage of mortgage finance is set to dampen investment activity. Confidence is key to a sustained recovery in the sector and this is going to be hard to bolster until the key issues surrounding the European sovereign debt crisis are resolved.’’

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March 24, 2012 deadline for first time buyer tax savings

09/01/2012

in East Devon,North Devon

Westcountry TEAM is issuing a reminder to all first time buyers looking for residential property priced between £125,001 and £250,000, that the current zero Stamp Duty rate applies until March 24, 2012.

Stamp Duty LandTax, to give it its proper name, is a Government tax paid by buyers on residential property transactions. As it stands, all purchases with a price up to and including £125,000 are exempt from the tax. On March 25, 2010, the Government extended this zero rate for first time buyers looking to purchase to a value of £250,000.

However, the exemption for first time buyers seeking a home with a value of between £125,001 and £250,000 ends on 24^th March 2012 and, providing this deadline isn’t extended, first timers will have to join buyers who have owned property before in paying 1% on purchase prices at this value.

So, estate agency members of Westcountry Team, one of the largest networks of independent estate agents in the South West, are urging first time buyers looking to purchase at this level to do it sooner rather than later, to take advantage of the saving. Those who make a purchase within the £125,001 to £250,000 bracket after this date will be eligible to pay up to £2,500.

Roger Hemming, director of Roger Hemming Estate Agents in Honiton, said: “First time buyers are currently enjoying total exemption of Stamp Duty on residential property purchases up to a value of £250,000 but as it stands, this will end on March 24, 2012 so they have only really a few weeks to find their new home and get the transaction moving in order that it is completed before the deadline. Many won’t be spending £250,000 but those looking at around the £150,000 mark will have to pay the 1% Stamp Duty if their transaction completes after this date, which means they will have to find £1,500 in addition to their deposit and the cost of removals, etc. No-one has cash to throw away at the moment, least of all first time buyers who may have struggled to save for the deposit and moving costs, and £1,500 is a hefty sum for anyone’s pocket. If this kind of money can be saved then we’d urge anyone who is eligible to do it now, while there’s still time.”

The current rate of Stamp Duty Land Tax for purchases of residential property of between £250,001 and £500,000 is 3%; £500,001 to £1million is 4% and those paying over £1million for their new home are paying a whopping 5%.

For further information or to get the ball rolling and find your dream home and save thousands in Stamp Duty, contact your local Team estate agent. There are over 100 Team offices in the Westcountry and hundreds nationwide, all working together to sell and find the right homes for clients. For further information about Team, visit www.westcountryteam.com.

Contact Roger Hemming on 01404 45343. To browse property for sale throughout the region or to find your nearest Team estate agent, go to www.teamprop.co.uk.

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Rental demand rises in the South West

09/12/2011

in East Devon,North Devon

The latest RICS Residential Lettings Survey reports rising tenant demand in the South West during the three months to October 2011.

Tenant demand remained strong in the region, with 19 per cent more chartered surveyors reporting demand rose rather fell. Respondents note that a lack of mortgage finance is the main reason for the large numbers turning to the rental market. However, fears over the economy are also playing a part, with renting seen as a safer option than purchasing a property in the current turbulent economic climate. Unlike many parts of the UK, supply of rental property to the South West’s rental market actually rose in the three months to October, with new landlord instructions moving to a net balance of +16 per cent. Surveyors note that some properties, particularly family homes, are now coming to the lettings market after unsuccessful sales campaigns.

As a result of increased supply levels, rental prices stabilised in the region – although surveyors note the picture is mixed depending on where you are in the region. Both landlords and tenants are aware of the financial climate and landlords are keen to keep good tenants even if it means accepting reduced rents. Given the rebalance between demand and supply, future expectations for rental prices remain positive – albeit low. Two per cent more surveyors expect rents will rise rather than fall over the coming months (down from 11 per cent more). Surveyors predict rents will increase at a faster pace for houses rather than flats.

RICS spokesperson James Scott-Lee commented: “The disappointing economic message communicated by the Chancellor in his Autumn Statement and the prospect of further job losses in some sectors and areas over those previously envisaged is likely to continue to strengthen the South West’s residential lettings market in the near term – particularly in terms of demand levels.” Comments from Chartered Surveyors across the region Martin Taylor MRICS, Goocg and Burley Ltd, Newent, Gloucestershire Typically at this time of year there is an increase in the number of properties, particularly houses, to let. There are tenants in the market who have sold and are taking six month lets, which is working to the advantage of landlords who want to sell, but don’t want empty property over the winter. This is a new trend. Landlords and tenants are aware of the financial climate – tenants want value for money, while landlords want to keep good tenants, even if it will mean accepting reduced rents. Robert Killen MRICS, Robert Killen, Wotton Under Edge, Gloucestershire Rentals for better quality rural property (say over £1200 pcm) in this part of the country are becoming tough. There are fewer prospective tenants and they want to pay less.

Peter Thomas MRICS, Smiths Gore, Exeter, Devon Much of this survey does not apply to this office as we deal mainly in individual rural properties on private estates. However it is fair to say that the market for let properties remains strong. Ian Matthews, Stratton Creber, Exeter, Devon There is still plenty of activity from potential tenants. I am not getting sufficient quality properties to service the demand. My typical demographic are young professionals looking to secure 1 or 2 bedroom properties, but I have a distinct lack of new landlords. Rents are holding up well despite the economic downturn.

Philip Greenway FRICS, Chesterton Humberts, Taunton, Somerset The market dropped off in August and never picked up in September or October. Applicants have become nervous about the economic situation and are not committing to even changing tenancies. There have been some signs of improvement at the end of October but a number of agreed lets are falling through or applicants are being rejected. Most trying letting period ever.

Alison Whitfield, Whitton & Laing, Exeter, Devon The local rental market is still very buoyant. Lots of tenancy applications are complex due to insecurity of jobs and poor credit ratings leading to unsuccessful applications. Landlords still expecting the best tenants at the highest rents and are not flexible with their requirements, which tenants are increasingly struggling to meet.

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Paula Cunningham - Director - Living Property

The government have announced today that it will not be extending the stamp duty holiday that it put in place in 2010 and extending until 24^th March 2012.

This means that property buyers will be faced with an additional cost of up to £250,000 if they complete their purchase after the 24^th March 2012. After this date entry level stamp duty will return, meaning 1% tax on a purchase between £125,000 and £250,000.

Those thinking of buying on investing in property in 2012 may consider bring their plans forward to beat the tax deadline date, but beware if you don’t find in early January you are unlikely to see the deal complete before the deadline as sales are reportedly taking an average now of 92 days.

Paula Cunningham – Director

Living Property Waveney Lettings & Management

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