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Property Eye #9
These recent property news items caught our eye:-
Fat Amy on the Move
Actress Rebel Wilson who plays Fat Amy in Pitch Perfect 2 is leaving her house share with Matt Lucas in Los Angeles to move to the £1.4 million house she bought last year and is currently renovating in Hollywood.
Charm School Converted
The South Kensington “finishing school” which groomed the likes of Joanna Lumley, Jean Shrimpton, Jemma Kidd and Tara Palmer-Tomkinson has been converted to six smart apartments with between one and five bedrooms and is on the market for a total value of £25 million.
Andre hopes for third time lucky
Peter Andre has put his home (featured in his ITV reality show) on the market for the third time. Having failed to sell his Sussex home twice since 2013 Peter is trying again at a price just under £1.7 million.
Ex-EastEnders Star offers riverside apartment for rent
Actor Stefan Booth best known for his role as Greg Jessop in BBC One soap EastEnders has bought a 2 bed riverside apartment in Wandsworth which he is offering to let at £625 per week.
Market to Boom Prediction
The UK property market has just entered an unprecedented period of boom which will continue for at least 15 years according to Taylor Woodrow Director Mike Hussey.
Hussey, who is a former executive at Land Securities, claims to have a reputation for calling the cycle right on previous occasions. He bases his prediction on “glacial” planning processes, soaring construction costs and plentiful demand fuelled by low interest rates and “instability” elsewhere in the world.
Tony Courtauld of Great Portland was also enthusiastic but more cautious predicting that rents will rise strongly and that “we have a few years left”.
Rob Noel of Land Security wasn’t as optimistic pointing out that rents are at an all-time high and yields at an all-time low so the market looks highly priced. He added that it might continue but “trees don’t grow all the way to the sky”.
London’s Biggest Home
Renovation of Witanhurst in Highgate built over one hundred years ago and sitting in an 11 acre plot is nearing completion.
Once finished the property will provide 90,000 square feet of living space and include 25 bedrooms, a 70 foot ballroom, a vast underground village containing swimming pool, cinema, massage rooms, sauna, gym, staff quarters and garaging for 25 cars.
It is owned by Andrey Gurvey, Russia’s 28th wealthiest man, and is the largest private house in London. (Buckingham Palace is bigger but is owned by the institution of the sovereign not the Queen). It cost £50 million when bought in 2008 and its estimated value when finished is £300 million.
Price of Seaside Home is soaring
Salcombe in Devon (or Chelsea-on-Sea as it’s been nicknamed) is now the UK’s most expensive seaside town for house buyers. The average price of £672,874 edges Salcombe slightly ahead of the runner up Sandbanks in Dorset which averages £614,726.
Scotland may be the place for more of a bargain home beside the sea with many towns averaging house values below the £100,000 mark. Bannatyne, Thurso, Girvan, Wick and Stranraer all fall within this category.
Property prices on Scotland’s north east coast are showing the fastest increases though with Fraserburgh leading the way up 105% from an average of £63,549 in 2005 to £132,920 this year.
House Values Rise in March
Statistic released by the Office for National Statistics reveal that house prices rose by 1.1% between February and March and are up by 9.6% on a year earlier.
Scotland leads the way up 14.6% over the past year compared to 11.2% in London and the South East.
Compared to values just before the financial crash in 2008 prices are up in England (14.5% higher), Scotland .(5.5%) and Wales (just 0.5%) but Northern Ireland is a staggering 45.7% lower. London is 39% higher.
Spot the odd Hotspot
The list of the top 10 new property hotspots recently published shows 9 within London and surrounding areas and just Sudbury in Suffolk outside of the M25.
The full list is Stoneleigh, Headley in Epsom, New Cross, Bethnal Green, Harrow, Sudbury, Edgware, Brentford and Kingston-upon-Thames.
The number of properties sold in Sudbury for £1 million or more rose from 1 to 7 last year with house prices rising by 12% (National average is 7.8%).
Crossing the Boundary
A government survey into boundary disputes has revealed that over 50% end up in court. Those cases can take between 3 months and several years to resolve and costs can be anything from £10,000 to £50,000 or more. Only 1 in 5 cases involved mediation which when used was successful in the majority of cases.
It is a warning to all buyers to carefully check that your conveyancer has produced properly measured transfer plans.
In one recent case an owner had to pay £15,000 to neighbours to buy the small patio area outside of the back door when plans revealed that the neighbour’s property extended right to the owner’s back door. The fact that the patio had been used by the owner and previous owners for several years didn’t outweigh the neighbour’s claim.
The Tenant Deposit Schemes introduced in 2007 enable tenants and landlords to seek arbitration in the event that there is a dispute over the return of the tenant’s deposit at the termination of the tenancy agreement.
In those cases which have reached arbitration the whole amount of the disputed deposit has been awarded to the tenant in 20.25% and to the landlord in 18.21% of cases. In the other cases only a partial deposit has been returned.
The main causes of dispute in the period last recorded (between 2013 and 2014) were cleaning (53%), damages (46%), redecoration (29%) arrears (16%) and gardening (14%).
Landlords can avoid disputes (or increase their chances of being successful in any disputes that do arise) by ensuring that they or their agent take the following steps:-
- Compile a full inventory at the outset and ensure that this is agreed and signed by the tenant
- Produce a comprehensive check in and check out report
- Ensure that the tenant is present during the check-out inspection
- Produce date stamped photographic evidence of the condition of the property at the start and end of the tenancy so that any change in condition is clearly identifiable
- Keep the tenant advised of any problems during the tenancy and make them aware of what financial impact they will have on the return of the deposit.
Is the Bank of Mum and Dad part of the problem?
We have referred before in Property Eye to how an increasing number of young first time buyers have to rely on their parents and grandparents to provide the initial deposit. Now it seems that the number of “granlords” investing their pension pots in buy to let properties could be pricing out the younger generation.
Increasing numbers of pensioners are securing properties at the smaller and cheaper end of the market, where the best yields are available, in competition to young first time buyers.
Although the Crossrail link doesn’t become operational for another 4 years an important step occurred on 31st May when MTR took over the train concession from the Liverpool Street to Essex.
Because of the commitment from Transport for London that Crossrail fares will be no dearer than those on the rest of the London Underground and Overground networks commuters will benefit immediately from the cheaper fares.
Travellers between Romford and Liverpool Street will get a 30% cut on their rush hour fare of £7.60 and Transport for London claim that 80% of journeys on the route will be cheaper.
The first Crossrail trains are due to begin in December 2018 with the full route from Shenfield to Reading becoming fully operational a year later.
Does Shared Ownership offer Hope to Londoners?
Three new shared ownership schemes on the fringes of central London were announced last week offering a possible lifeline to first-time buyers seeking to get into the London property market.
The three schemes which are all similar in concept offer a 25% share in one bed flats for prices from £78,000 in Limehouse, £87,000 in Mile End and £101,000 in Shoreditch. Two bed flats are around £20,000 to £25,000 more for a ¼ share.
Queens Speech – What happened to Housing Promise?
The Government’s proposals as outlined in the Queen’s speech opening the new session of parliament failed to include detail about the Conservatives pre-election commitment to build 200,000 new homes a year.
In fact other than the controversial extension of the “right to buy” scheme to include Housing Association tenants (a move which many fear may worsen the housing shortage) the housing crisis was totally ignored.
No plans were announced to transform the housing markets, incentivise construction, provide more homes, modernise and speed up the planning process (already getting worse because of local government cuts to planning departments) or to tackle the issue of house prices getting further and further ahead of what the “ordinary” first time buyer can afford. (In London average house prices are now at a multiple of 14 times average earnings and increasing yearly)
Last year in London only 35,000 new homes were built compared to the 52,000 needed to keep up with demand. The 17,000 shortfall is made worse by the proportion of new builds then snapped up by foreign buyers (around ¾ in 2012) and left empty. Effectively just bank accounts accumulating growth rather than adding to the housing stock.
The government’s inaction disappointed those hoping for new initiatives to tackle the biggest housing crisis since the 1940s.
80% of overseas investors looking to buy property in Tuscany would, until recently, have sought to renovate a tumbledown wreck in the countryside with only 20% looking to buy a city apartment in Florence. But now it is the reverse.
Compared to a remote country dwelling a city apartment comes with a longer rental season and lower maintenance costs (no costly pool to maintain and heat). Also getting to and from the airport is both cheaper and quicker (making a spontaneous weekend break that much easier).
Apartments in Florence are not numerous but examples currently on the market include two studios both priced at £360,000 in a beautifully renovated 16th century palace. Also nearby are a couple of 2 bed flats for c£600,000.
Florence offers an appealing mix of wonderful culture, vibrant history, delicious food and proximity to beautiful countryside – there are numerous flights from the UK with flight times from London around 2 hours.
If you have any comments on any of the above or would like more information about buying, selling, renting, letting or finding a property please get in touch via our website thehomecloud.xenacia.com