Tuesday, 24 June 2014


With the recent unlocking of rules on how people can access their savings in retirement, could a new breed of ‘buy to let pensioners’ be ready to enter the local property market?

Nationwide property lettings specialist, ClearMove, is advising caution in the wake of the Chancellor’s Budget announcement that savers will be allowed to withdraw their entire pension fund from the age of 55 or over, rather than take the money slowly as an annual income, such as an annuity.

“Since the last Budget many financial commentators have speculated that following the new rules – due to come into effect from April 2015 – pension savers could draw down some or all* of their money to invest in options such as buy to let property,” says Russell Greatbatch who co owns the ClearMove office on Kings Road in Fleet, Hampshire.

“With recent surveys reporting that buy to let has outperformed all other mainstream investments over the past 18 years, this could be an extremely attractive option for anyone wanting to safeguard their capital and maximise their income in retirement.

“Whilst this may be true, we believe that anyone considering their first move into the sector should take expert advice.

“Buy to let continues to offer great opportunities, but potential investors must have a clear strategy, and it should never be considered as a ‘get rich quick’ scheme.”

* Subject to conditions

This year marks the 18th anniversary of the buy to let mortgage initiative launched by the Association of Residential Lettings Agents (ARLA). Tracker studies indicate that since its introduction, buy to let investment has provided an average return of 16.3 per cent – considerably more than most other asset classes.     

Over a third of Britain’s 1.4 million private landlords already view their buy to let portfolio as the main component within their pension plan – with the relative ‘safety’ of bricks and mortar investment coupled with regular rental returns as income, making it an attractive investment choice.

Anna Huckson,  Lettings Manager of ClearMove, comments: “The Chancellor’s recent pension reforms have ignited a great deal of interest in buy to let as a viable and attractive alternative to more traditional pension plans.

“Market demand for quality, well maintained, private rental property remains high and even before the recent Budget announcement our offices throughout the UK were experiencing a growing number of enquiries from people seeking advice and guidance on how to enter this sector for the first time.”

Some industry commentators are predicting returns of around 11 per cent per year over the next decade and a number of specialist, buy to let lenders have also started to reconsider current age restrictions to allow people up to age 70 to apply for long term buy to let mortgages – subject to them meeting certain criteria.

Rachel Jenkins, ClearMove  Sales & Lettings Negotiator adds: “With all the excitement generated by the new reforms we would recommend that anyone looking to use pension savings to fund a buy to let investment should – as a first step - take professional financial advice and then sit down with property lettings experts, such as ClearMove, to map out a strategy for their future goals.

“It is important for first time investors to buy property at the right price, in the right location and to identify the type of accommodation that people will want to rent from them both now and in the future.

“With our local knowledge we can look in detail at potential property ‘yields’ - taking into account all outgoings, such as maintenance costs - and provide novice investors with a realistic expectation on returns.

“There are many legislative and other issues to take into account but the ClearMove local office are staffed by experienced, highly trained specialists who can advise on all aspects of property investment and management.

“We are happy to offer a free initial – no obligation – consultation to anyone wanting to learn more about how to become a successful property investor. And for those who do decide to invest their pension funds into property we can provide a full range of management and other services to ensure their new alternative pension investment is a trouble free one.”

To arrange a FREE and no obligation discussion with our Buy to Let specialist, please contact us on 01252 615263 or email us at: info@clearmoveuk.com

Tuesday, 13 May 2014

CBI on 'high alert' over house prices

The Guardian Reports:  Britain's leading business lobby group has warned that policymakers must be ready to act on unsustainable house price rises in the UK.

The CBI said it was on high alert after annual house price inflation reached more than 10% in some areas. It now expects interest rates to rise in the first three months of 2015, six months earlier than it previously predicted and, crucially, before the general election.
John Cridland, the group's director-general, said: "We have to remain alert to the risks posed by unsustainable house price inflation, and the [Bank of England's] financial policy committee is poised to act when necessary.
"Housing has come back under the spotlight as annual house price inflation figures have reached double digits on some measures. While housing transactions are still running almost 30% below their last peak in 2006, they are picking up steadily."
The business lobby group is expecting house prices to rise by 8.2% this year, and by 5.1% in 2015. Prices rose 3.6% in 2013.
It raised its forecasts for economic growth this year and next, and said the recovery was becoming better balanced with a sharp rise in business investment expected. It expects the economy to grow by 3% this year, stronger than an earlier forecast of 2.6%. Next year growth is expected to be 2.7%, compared with an earlier forecast of 2.5%.
The CBI warned that "loose talk" and anti-business rhetoric in the runup to next May's general election risked damaging investment and derailing the recovery.
"The UK now has more stable economic foundations, and political risks must not jeopardise this. Politicians must be wary of the risk of headline-grabbing policies that weaken investment, opportunity and jobs," Cridland said.
"We've got a combination of political risks that we've not had for some while. They range from UK general election to Scottish referendum on independence to the prospect of a referendum on European Union, so that's quite a cocktail of issues."
He said the message to all parties was to stick with what's working, including a commitment to cut the deficit.
The CBI brought forward its expectation for the first rise in interest rates to the first quarter of 2015, when it expects the first 0.25 percentage point rise in rates. It had previously forecast the first rise in rates would come in the third quarter of next year. Rates have been on hold at a record low of 0.5% since March 2009.
Cridland said the government's controversial Help to Buy scheme – blamed by some for creating a new housing bubble – was not responsible for unsustainable rises in house prices, arguing it was a relatively small part of the overall market.
"Help to Buy is primarily helping people outside London, on relatively modest mortgages, and appears very much still to be helping first time buyers. Those were the CBI's core objectives."
He said it was important to remember that although London prices were 25% above the 2008 peak, in part fuelled by rich cash buyers, prices in the rest of the UK were still 2% lower.
The CBI chief said bold action was needed from government to address the chronic shortage of houses in the UK, so that supply had a chance of keeping up with demand. The CBI wants to see councils releasing more land, and the possibility of new garden cities to be explored by policymakers.
Meanwhile, Katja Hall, the CBI's chief policy director, said the warning on anti-business policies was meant for all parties but admitted Labour's pledge to freeze energy prices and the hard line on banks were concerns.
"Some of the loose language we've heard is from politicians from all parties. Of course there is concern about the proposed energy freeze and some of the proposals on banking.
"Political positioning must not be allowed to stifle investment, whether it's an unrealistic immigration target, unjustified interventions into specific markets, flirting with leaving the European Union, delaying vital long-term infrastructure projects or restricting labour market flexibility."
The CBI wants a commitment before the election from all parties to the recommendations made on increasing the UK's airport capacity in the Davies commission.
The group predicts that unemployment will fall further to 6.8% this year and 6.4% next year, from 7.5% in 2013. Hall said the UK labour market was "looking really healthy". She said last summer marked a turning point, with a big increase in full-time permanent employment, after a period when self-employment, part-time work, and temporary work were factors driving a rise in employment. She also made the case for zero-hours contracts, where employees are not guaranteed a minimum number of hours.

"They are not bad contracts, they are an important part of a flexible labour market and they have helped to protect jobs during the recession, and create jobs as the economy started to recover," she said.
For more information on selling your property, home, house, flat or commercial property in Fleet, Church Crookham, Elvetham Heath, Aldershot, Farnborough or the surrounding area, please contact us for a no obligation and up to date valuation 01252 615263

Thursday, 3 April 2014

Three Words That Can Save The Day

Three words can make or break deposit disputes between landlords and tenants … inventory, inventory, inventory. 
“Just as ‘location’ is a key word in buying a property, ‘inventory’ is a key word in renting it,” says Russell Greatbatch, Director of Fleet's favourite residential lettings specialist, who has an office on Kings Road, Fleet.

Disagreements over the condition of property, at the end of a tenancy, is a major reason for disputes arising over how much of the tenant’s deposit should be returned, because landlords often deduct the cost of cleaning, replacing or repairing household items, furniture and furnishings that tenants say were like that when they moved in.

“A good quality inventory with clear photographs - agreed, signed and dated by both landlord and tenant – can overcome all argument about the condition of a property and its contents,” says Russell who runs the ClearMove office  “What would otherwise be a matter of opinion becomes a matter of fact.”

“When you consider that, according to current Land Registry data, the average property price in Britain is now £225,000, it makes a lot of sense for landlords to protect their assets with a quality inventory. Professional lettings agents such as ClearMove are very experienced in carrying out a thorough and detailed inventory report – providing a solid assurance to landlords that their interests are well protected.”

There are other basic ways of making sure that relationships run smoothly.

When a tenancy starts, the landlord and tenant should each keep jointly signed tenancy agreements that set out terms, conditions, obligations and responsibilities on both sides. If a property in not fully managed and the landlord does not have an agent, they should both be present to go through the property, discuss any concerns and agree the inventory.

Tenants should also meet up with landlords or their agents for any periodic inspections during the tenancy – at least two or three times a year to ensure there are not any serious problems with the property.

Landlords should keep relevant invoices, bills, work records and household receipts as evidence of expenditure, whilst tenants should keep copies of household bills, since they should not be arranging for any works or alterations to a rented property without first consulting the landlord or agent.

And when the tenancy is over both parties should be present at the ‘check-out’ to discuss any problems and reach agreement over any deductions from the deposit.

“Accidents happen but so does normal wear and tear,” adds Russell “If both landlords and tenants stay realistic then many quarrels can be settled before there’s any need for the dispute resolution process.

“In fact there is another key factor in all this – it’s called ‘communication’. Done properly, it can save an awful lot of trouble.”

I don't need to declare every penny of my rent to the HMRC, do I ? You do and now you have no choice

HMRC recently declared their let property campaign (LPC) which aims to nudge landlords into confessing undeclared rental income. They have declared how they will get the information they need. They are fundamentally looking for errant landlords. We now know how those landlords will be found.

HMRC is writing to letting agents in the UK, asking them to provide details of the properties they have let in 2012/13, including the amount collected per property and the addresses of the let property and the landlord. The letting agent is given just 60 days to provide the information, or face a penalty of £300, and further penalties of £60 per day for additional delays. This will include landlords that use agents for tenant find services as well as managed services.

The agent also can't refuse to provide its customers' details on the grounds that such personal information is protected by Data Protection Act 1998, as the tax law overrules the Data Protection Act in these circumstances.
What does this mean to you?

Now is the time to ensure all your rental income is declared. Ensure every penny is on your annual tax return regardless of whether you have made a profit or not.

Don't forget, we can provide you with an annual statement to make doing your return quicker and easier. This will have all your income and all your expenses listed but don't forget to claim back the interest on any mortgage you have on the property as this of course will NOT be listed and is a legitimate expense (you cannot claim the capital repayment portion of your monthly mortgage payment).

For more information on the above or any other matter, please contact us 01252 615263 info@clearmoveuk.com

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