Publisihed by The Daily Express 18th November 2019
Selling a property is not an easy task so getting an experts opinion can make the process easier. Most Britons will do this by looking to estate agents for advice on how to get the best deal. However, they may not always act in the interest of the seller and homeowners should look out for one trick, an expert warned.
Estate agents are on hand to help those who are trying to sell or buy a property. They can offer advice on how much the property is worth and give tips and tricks on how to sell quickly. However, some experts will not always work in the best interest of the seller, an expert warned.
While many estate agents will try hard to help sellers shift their home, others may not give the best advice. When choosing which estate agents to go use, it can be tempting to pick the one which gives homeowners the highest valuation for their property.
However, if a price seems too good to be true, it probably is, Jamie Salisbury, property expert at digital estate agency, Nested, explained. He told Express.co.uk: “Be careful of choosing the estate agent who gave you the highest valuation.
Some agents may overvalue a property in the hopes of enticing sellers when it is not actually possible to get that price. Instead of accepting a high valuation, homeowners can do their own research to see how much they could actually get.
“Ask the agent to provide you with similar properties to yours that have sold for that price,” he added. What’s more, putting a property on the market for a high asking price can actually make it more difficult to sell.
“If you go on the market with an unrealistic asking price it may leave you on the market for longer, which will delay your move.”
If the property is listed for more than similar homes, it could be left on the market and slow down the process. When picking an estate agent, it is also important to be careful before signing up for a contract. Some estate agents will try to sign up sellers up for contracts for as long as 26 weeks, an expert explained.
This can further slow down the selling process and leave sellers out of pocket as a result.
With Britain edging closer to its first recession since the financial crisis, a leading property auctioneer is urging property investors, including buy-to-let landlords, to hold their nerve against the spectre of an economic downturn.
The country’s dominant service sector, which accounts for about 80% of the economy, unexpectedly plunged into contraction last month, in a sign of the increasing stress facing the economy as Brexit looms.
According to IHS Markit and the Chartered Institute of Procurement and Supply (Cips),
activity in the sector fell as companies reported a fall in sales, job losses, cancelled and postponed projects and weak investment levels.
There has been a recent rise in properties going into receivership, banks unwilling to lend for construction projects and a decline in tenants looking to rent business or residential properties, according to Mark Bailey, managing director of Landwood Group, who says that a rise in auction sales is also evident, largely down to an increase in repossessions.
He said: “Worryingly, at Landwood we are also receiving more instructions over the past few months than we have done for a year or more – instructions for properties that have sadly gone into receivership.
“It is harder for property owners to let business space and for domestic landlords to find tenants – there’s no doubt that a squeeze is on.
“With each failed building project, banks become more nervous to lend, builders stop building… and we fall headlong into a dreaded recession. Once we do, it’s anyone’s guess how deep it is or how long it lasts.
“The blame for all of this cannot be put at the door of Brexit… well, not entirely. There is no arguing with the fact that this is a period of change – domestically and globally. People err to the negative whenever there is change on the horizon – until events transpire and the scales balance out. The big issue is uncertainty and property is key to all of this. Uncertainty causes negativity, while a solid market has the opposite effect.”
So, if the pointers are all correct and a recession is upon us, what is the advice?
“Sit tight,” said Bailey. “Whether you are a commercial property owner or a domestic landlord, try your best to ride it out, perhaps for six months, before making any business decisions. Look at your borrowings and don’t over-stretch yourself at this time.
“There are always people who benefit from downturns in the market and they tend to be cash buyers. So if you have cash to invest long-term, a ripe time to buy may be about to begin.
“For the rest of us, it’s time to batten down the hatches and ride out the storm – see you on the other side.”
A London estate agency says one of its buyers wants to delay completion until November 1 “just in case stamp duty is changed in October”. Aylesford International director Brendan Roberts says one of his firm’s buyers made the request following speculation that stamp duty could be lowered by Chancellor Sajid Javid.
“Anyone looking to sell is unlikely to conclude a sale much before late October even if they found a buyer early September, so agreeing a delayed completion to allow for any changes in SDLT shouldn’t create too much inconvenience and with buyers thin on the ground it is useful to be flexible and adapt to help buyers commit” explains Roberts.
The move follows widespread speculation by government ministers that stamp duty will be reformed – but without saying when or how. Other agents report alternative tactics pursued by purchasers keen to avoid paying more SDLT than they need – but these raise questions over whether conveyancers would help.
“We have had a pronounced increase in enquiries from clients seeking to utilise the existing ‘mixed use’ stamp duty concession. This concession is still not well understood but can yield dramatic savings on higher value properties” explains Gideon Sumption of Stacks Property Search.
“There is a huge and obvious incentive to look at mixed use property where the maximum rate of SDLT is five per cent. There is no current legal definition but such is the amount of money involved there will almost certainly be some case law soon” Sumption continues.
“The current understanding is that for mixed use SDLT to apply, the property needs to have a commercial element, namely enjoy commercial income from land or buildings that from part of the whole. This could be a self-contained annexe let on an assured shorthold tenancy, some pasture let to a farmer or some buildings let as workshops. What won’t qualify are extensive grounds used purely for the enjoyment of the house.”
Another Stacks agent, Bill Spreckley, says buyers are becoming “more and more aware “ not only about the mixed use option but also how so-called ‘multiple dwellings’ can attract lower SDLT.
“If you buy a property with ‘Multiple Dwellings’ – that is an annexe, cottage or flat – then there are discounts available. One takes the price of the whole property, divide it by the number of properties, work out the SDLT per property and then multiply that figure by the number of properties again” he says. He says a principal property sold with two cottages counting as ‘multiple dwellings’ – each sold at a notional £666,666 – would attract stamp duty of £69,999 but sold as one unit at £2m it would incur SDLT of £153,750.
A quarter – 25% – of homes rented from private landlords fail to meet the national Decent Homes Standard when taking into account hazards, costs and other characteristics, analysis of the English Housing Survey reveals. Households containing several million people are currently living in unsafe or unsuitable rented accommodation, according to the research by VeriSmart. The study by the independent property inspectors details how 19.5% of homes in the country, which works out at about 4.5 million properties, failed to meet the government’s Decent Homes Standard, when taking into account hazards, costs and other characteristics.
The assessment of the English Housing Survey, which dates back to 1967, shows that the social sector had the lowest proportion of non-decent homes at 13%.
The most common Category 1 hazards – the most dangerous type of hazard – were falls and fires. Falls on stairs, on a level and between levels accounted for the three most common types of hazard, with fires in fourth place. Converted flats were deemed the most hazardous property type, with 21% of such homes likely to contain hazards, while private homes were the next most dangerous by this measure (14%).
Houses were close behind (12%), with flats proving safer (8%), though social rented homes were least likely to play host to a hazard at just 6%. Some 1.1 million homes had a serious fire hazard – for example no smoke alarms, old or faulty electrical systems, missing fire doors – and other hazards included damp and mould, electrical safety faults and hot surfaces. Jonathan Senior, chairman of VeriSmart, commented: “The figures are worrying when one considers that one in five homes is sub-standard as far as safety, costs and other measures are concerned.
“Some may fret at the average cost to fix a property so that it meets the required standard, but when these properties are falling below expectations in part due to hazards, safety surely has to take priority.
“We recently looked at the tragic number of home accidents – many involving children and many leading to fatalities – and it’s clear that chances can’t be taken in this area.”