British public hates property tax more than any other

In a recent survey by Co-operative Financial Services of unpopular taxes, these were the following 5 most hated: 1.    Inheritance tax 2.    Stamp Duty 3.    Council tax 4.    Fuel and road duty 5.    Income tax So, out of the 5 most unpopular taxes, the top 3 related to tax on property.  Interestingly, the British public hated tax on property more than income tax. Food for thought. Leasehold & Freehold Legislation | Property Management Law Blog

Why families rarely live in flats?

Have you ever wondered why so few families live in flats?  I was pondering this question earlier today, as I thought about the shortage of housing in this country and what could be done to help. Of course, Mira Bar-Hillel has eloquently advocated one solution: build-to-let.  You can read all about it in News on the Block by clicking here. It’s a novel idea, which deserves support.   However, when you look at the market for leasehold flats - especially the new build developments which have sprung up in the last 10 years - most are studio, 1 or 2 bedroom leasehold flats.  Yes, larger leasehold units are built.  Yet, these are usually the minority in a development and are often the “penthouse” (and consequently priced).  So, here’s a thought:  the reason why so few families live in leasehold flats is because few leasehold flats have the living space to accommodate families.  Even a modest family would ideally like a 3-bedroom property.  But because 3-bedroom leasehold flats are less prevalent that studios, 1- or 2-bedrooms they cost more.  Also, by their very nature, leasehold flats are urban-centric where land is more expensive.  So, apart from being few and far between, those 3-bedroom+ leasehold flats that do exist are situated on the most expensive parcels of land a city has to offer.  This means that many families are priced out of living in leasehold flats, and are forced into the suburbs.  In return, flats become the preferred choice for young professionals, singles, sharers, widows, and retirees.  I wonder if  it would be appropriate for more flats to be built with 3-bedrooms plus and thereby cater better for families?

Leasehold & Freehold Legislation | Property Management Law Blog

A landlord’s life: you couldn’t make it up

David Salusbury from the National Landlords Association told me today that his organisation received a record number of calls from landlords seeking advice last year. These are almost exclusively about short-let, AST (Assured Shorthold)-type tenancies and not the long-leasehold problems more commonly dealt with by News on the Block. However, what tickled me was some of the weird and wonderful calls his advisors had to face, such as:
  • A landlord, inspecting his property after leaving it two years, found the kitchen had been removed and installed in another room. In addition, he found a brick out-building had been demolished and a large conservatory built in its place.
  •  While a landlord was awaiting a court order to remove an anti-social tenant, a neighbour called her to say the tenants had left the property during the night. The landlord arrived to find the whole central heating system had been stolen. This didn’t matter greatly as they had taken all the double glazing too.
  • Visiting a property of a long-term tenant, a landlord found that the tenant had removed the garage door and replaced it with a brick wall and a window. The tenant then knocked through from the hallway to the garage and sub-let this ‘extra room’.
You couldn’t make it up. Leasehold & Freehold Legislation | Property Management Law Blog

What estate agents don’t (always) tell you about flats….

When looking to buy a flat, prospective purchasers will often receive details of the property from the agent.  These details, along with the agents glowing description of the property, will often focus on the best points about the property.  What more would you expect?  The agents are, after all, sales people.  When you look into the nitty-gritty of the details, there will always be two items with insufficient detail:  the length of the lease and the amount of the service charge.   These items are often accompanied by the mysterious “tba”.   However, the well known mantra of “the devil is in the detail” is never more true than when buying a flat.  You can find out more information about owning a flat in my book. Price aside, perhaps the most important pieces of information you need to know are the length of the lease and the amount of the service charges.  If the lease is short, you’ll probably need a lease extension and these can be expensive.  If the service charges are too high, then you could be overpaying in maintenance costs.  If the service charges are too low, then the building may not be adequately maintained and the value of your investment will suffer.

You’ll get this information eventually, but if you have it upfront then you’ll know sooner whether to waste any time considering the flat as a realistic purchase.  And, that’s probably why the estate agents don’t want to be too forthcoming about this information in the first place….

Leasehold & Freehold Legislation | Property Management Law Blog

Flat feet

If you’ve ever thought about what the parcel of land beneath your feet is worth, now you know. Thanks to Hamptons International.  Their latest survey - or “London Heat Map” as it has notionally be named - suggests that there are five markets iin London with an average price in excess of £1000 per sq ft (SW&, W8, SW3, W11, and W1).  Acroos the London market, as a whole, the average price was £798 per square foot.  So, now you know.

Leasehold & Freehold Legislation | Property Management Law Blog

Hip, Hip, Beware

You may have heard that the Home Information Pack regime will soon be extended to include flats. News on the Block has already written quite a lot on the subject. With just a few months to go until HIPS for flats become law, the Department for Communities and Local Government have warned that some HIP providers are using invalid title documents. The HIPs market has not proved to be the windfall for providers many predicted. So, in a competitive market and to minimise costs, some providers have been relying on photocopies of the title at the Land Registry instead of official copies. Any conveyancing solicitor worth his/her hourly fee will tell you this is not good enough to provide you with protection. However, for those not so familiar with the home buying and selling process the invalid nature of these documents may not be so obvious. Hopefully, these providers will improve their service by the time flat owners need them later in the year.

Leasehold & Freehold Legislation | Property Management Law Blog

Bonjour, from Cannes!

You may have been wondering why I have been ‘offline’ recently.  I’ve been preparing from MIPIM 2008.  MIPIM is the world’s leading property exhibition.  Based in Cannes, in the South of France the event attracts 26, 210 participants throughout the week-long event.  I’m here to meet some of the 1,900 participants from the UK property industry to discover more about what’s in store for leasehold property over the next year.  Tomorrow is “Green Day” at MIPIM, so watch out for some inspiring new ideas from the property world as they try to save the environment one brick at a time.  News on the Block has already reported extensively on environmental issues which impact flats.  You can see some of those articles here.  We have also published a whole supplement on the topic, called “The Green House”.  You can read it by clicking here. Also, if you have an innovative idea which can make a positive environmental impact on flats then you should consider entering othe CBG Environmental Challenge.  We are delighted that Vincent Tchenguiz, Chairman of Consensus Business Group is supporting this worthwhile initiative.  Finally, for those green-fingered property people reading this, you may also be interested in Environmental Property News  International , a must-read newsletter all about property and the environment. So, check back regularly as I’ll be bringing you all the latest news and gossip from the residential industry here at MIPIM….

Leasehold & Freehold Legislation | Property Management Law Blog

Flats from fuel?

Has anyone other than me noticed that petrol stations in cities across the UK have been disappearing?  It seems increasingly difficult to find fuel as petrol stations are boarded up and replaced.  I can think of several such sites in London and the South Coast alone.  I have also noticed a trend for the former site of the petrol station to be converted into a new build block of leasehold flats in due course. I’d be interested to know if you have also noticed this phenomenon or knowledge of the ‘master plan’ to create flats from fuel.  When large, profitable, multi-national oil companies feel they can make more from property than petrol it is a sure sign of the value of property as an asset.  Perhaps a more worrying trend, of course, would be to see blocks of leasehold flats being converted into petrol stations.  But in these sub-prime property times, anything is possible…

Leasehold & Freehold Legislation | Property Management Law Blog

Escaping leasehold flats

Recently, The Daily Telegraph reported in this fascinating article how many Britons are leaving the UK to find their fortunes further afield.  The Economist has  already provided some interesting analysis about this trend. Notably, doctors, teachers and engineers were the types of people most likely to flee the UK.  It may not have had a direct effect, but as these types of people can fall within the key-worker category, I wonder how much of an impact this key worker housing policy is really having?  After all, if as The Economist says,  ”a Briton can now purchase most of Phoenix for the price of a Chelsea broom closet“  then why would they want to hang around some second rate leasehold flat here?  Also, considering some of the most popular destinations cited int he article include Australia and America where the stress of dealing with English leasehold law does not exist, moving abroad is an understandably tempting option.

Leasehold & Freehold Legislation | Property Management Law Blog

What is sub-prime?

The phrase ’sub-prime’ is being thrown around quite a lot these days.  If you are somewhat confused as to what sub-prime is all about, then this wry look may go someway to explain the mystery. Enjoy!

Leasehold & Freehold Legislation | Property Management Law Blog