Property Update

PROPERTY UPDATE

You would think, wouldn’t you that anyone selling or renting out their property would want to make it look absolutely spick and span at the time they put it on the market. However, a study commissioned by the online lettings portal Mashroom paints a different picture. Almost half of Brits apparently have described a property viewing as “disgusting”. This is because of filthy carpets, dirty dishes in the sink, and the smell of cats. The study also found clutter and mess are among the most off-putting things for anyone looking at a potential new home. The research also highlights the huge importance of putting together a good selection of photos or a video for people to view online. 56% of respondents to the survey admitted they had been put off the property before viewing because of badly taken pictures of the inside. The lettings portal apparently has launched a campaign to show sellers and landlords how to stage their home perfectly for prospective renter and buyers.

PARENTAL SUPPORT

It appears that Nationwide Building Society is not too impressed with potential buyers getting help from their parents to buy their property. The building society now says that a buyer who is seeking a lower end deposit mortgage must come up with at least 3/4 of the deposit from their own savings, with help from family members to be restricted to 25%. The cap applies on lending to first-time buyers at 90% but inheritance is exempt and treated as the applicant’s own savings. Nationwide argues that asking applicants to provide 75% of the deposit “demonstrates that someone is able to save and manage their finances” but the development could cause obstacles for first-time buyers. Estate agents Savills estimate that nearly 40% of first-time buyers relied on family financial support in 2019, with family lending around £5 billion in total.

CGT ON PROPERTY?

A golden rule of HMRC is that if you own and live in your own property you are exempt from paying capital gains tax when you sell it. Any increase in value is, therefore, yours and is not subject to taxation. When a property transaction goes through, the law at present is that the buyer pays any taxes due in the form of stamp duty. There is a review of capital gains tax underway, and one of the options which the government is looking at is to scrap stamp duty and IHT on property and instead charge capital gains tax on the seller. Were that to happen, it is estimated that charging CGT on primary residences would be worth an extra £26.7 billion a year to the Treasury. An analyst for the Telegraph says that if movers pay CGT instead of stamp duty, they will end up paying more tax overall but will be paying an amount based on how much they have profited “not based on how much they are spending.”

NO DSS

There has been a recent landmark ruling in the courts saying that landlords are not allowed to discriminate against people who receive DSS support. Shelter has claimed, however, that hundreds of private renters in England in receipt of benefits have contacted that charity to complain that they are still struggling to secure accommodation despite the court’s ruling. Such people looking for homes have said that many landlords do not seem to be aware of the court’s decision to outlaw discrimination against DSS tenants. It is about time such landlords are brought to heel.

HOMES FOR THE ELDERLY

By the year 2037 one in four of the population will be over the age of 65. How are they to be housed? The fact is that homes for the elderly are not being built fast enough to meet demand. The estate agents Knight Frank predicts the number of retirement properties will rise by 10% over the next five years to a total of 800,000 with a number of major investment companies putting in more cash. However, there will still be a huge shortfall. The estate agency thinks that by 2024 there will be 120 senior housing units per 1000 people aged over 75. This is a drop of 12.4% since 2020. It added that planning policy has been holding back the development of homes for the elderly and indicates that few councils have been singling out this part of the market for serious development. If bespoke homes for the elderly are not available, then they will presumably stay in their own homes which will often be much too large for them. This in turn will keep bigger properties off the market causing young families to miss out.

LONDON PRICES

Two of the biggest property websites Rightmove and Zoopla have confirmed that they have no three-bedroom houses listed for sale in London at a price below £325,000. The very cheapest property listed on Rightmove is a terraced house in South East London with an asking price of “offers in excess of £325,000.” Believe it or not, the average price of a three-bedroom family home in London is £605,347. And this is down £66,000 on the same time last year! Compared to that, the typical value of a British home currently stands at £291,055. This is down £25,000 in the past year. It does not take a mathematician to work out that the average price of a home in London is still twice the average of a home in Britain.

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