Greater London house prices have risen 15.6 per cent in the past year according to LSL but values in some of the capital's most expensive addresses are now firmly on their way down.
Four of the top five boroughs with the highest average house value now have average prices that are actually below their peaks of earlier this year. In three of the four, prices are five per cent or more below peak.
Meamwhile LSL's national house price index saw an increase of 9.6 per cent in the past year - although this collapses to only 5.2 per cent once London and south east England’s increases are removed from the equation.
LSL director David Newnes says the figures make the case for Help To Buy in an era when there are new affordability regulations and stress tests tightening mortgage approvals.
“Help to Buy remains a crucial link in bolstering first-time buyer demand. HTB may not make a difference in London, but it is a vital aid for aspiring homebuyers in parts of the country where prices are still regaining ground lost during the recession. Places like Lancashire and York are still experiencing annual growth below one per cent" he says.
- housing market
It just doesn’t stop. Each Friday we give a brief round-up of agents' charity work, and summer sunshine has only encouraged more of you, it seems.
We at EAT and LAT hugely admire the often-unsung work by agents who donate energy, time and money to charity. We want to shine a spotlight on this side of agency.
If you want to be mentioned, please let us know. Email firstname.lastname@example.org.
CARDINAL HUME CENTRE: £19,000 has been raised by a (freshly-rebranded) Chestertons team in Grosvenor’s 13th Annual Dragon Boat Regatta at Marlow. The agency set the fastest time in each of the rounds to beat 27 other teams to the coveted trophy.
CHARITY VOLUNTEERING: Staff from across five branches of Waterfords, in Camberley, Sunningdale, Chobham, Fleet and Yateley, have completed their first week of volunteering, after each agreeing to donate one working day to help in the local community.
The first team spent a day with Camberley-based charity Make-a-Wish Foundation. The team was tasked with helping to put together more than 2,500 fundraising packs to be sent out to supporters of the charity.
Another team of five Waterfords volunteers embarked on a day of manual labour at Frimhurst Family House in Frimley Green - a manor which welcomes disadvantaged families from all over the country for short respite breaks.
Gary Brook, Waterfords director, says the team “had an extremely tiring but very rewarding day. The team at Frimhurst Family House looked after us tremendously well and I am delighted that, in a very small way, we were able to contribute to such a fantastic facility.”
HELP FOR HEROES: Rook Matthews Sayer has been showing its support for our servicemen and women - staff have been busy baking and raising money from cake sales at branches, as well as donating £10 for every house sold. So far a whopping £6,263.33 has been raised.
- estate agents
I was renting a property as we were renovating our own property. We took very good care of the house and had it professionally cleaned before we handed it back to the estate agency, who was happy but requested that the external drains be cleaned and the grass cut. Both were done. After that began... Read more
My tenant has been in my property for over two years now. Never the tidiest of girls but has a good job and always paid rent on time but I arrange to access each year with gas engineer for annual service. This year there were worrying signs of disorder. There’s obviously new man been... Read more
BACKGROUND: During a redevelopment about 20 years ago these terraced properties had an ‘outrigger’ extension added to the rear. Ownership of the outrigger itself is divided; the upper floor forms a dressing room in my ‘let’ property (I own the ‘flying freehold’). The ground floor forms a bathroom for the neighbouring property. Subsidence is causing... Read more
The post Subsidence of Neighbouring Property is Damaging My House appeared first on Property118.com.
I recall reading something about some new legislation that was coming into force around October (though I cannot find it!) regarding anyone acting as an agent would need to register with a professional body (like The Property Ombudsman) and have Indemnity insurance. Is this true? The reason why I am asking is that I rent... Read more
The second strongest performing area for buy-to-let investments in terms of rental returns, Manchester is quickly establishing itself as one of the UK’s most popular investment capitals. The city is already posting average annual rents of £8,316 and with year-on-year rental growth currently standing at 5% these returns are set to only further grow. Manchester... Read more
I have just found out, after signing a contract with an estate agent, that they have found someone to rent it for three years instead of a year. I was happy with a three year tenancy but unbeknown to me they taking their fees upfront fee so I wont receive any rent for 5 months!... Read more
I can’t quite believe that I am asking what is the fairest way of taking the first month’s rent and deposit, as it seems so simple, but here goes. Some tenants moved into my very nice flat last week, having only paid a holding fee (normally about a third of the rent), for which I... Read more
The final type of HMO definition we are going to look at relates to planning.HMOs and plannning
Historically there hasn’t been any substantial system for controlling the overall number of HMOs in a particular area. Notably, an HMO licence cannot be refused on the basis that there are a large number of other HMOs in a particular area.
The traditional method of controlling property and land use in the UK has been through planning control.
In April 2010 new forms of planning control were introduced in the final days of the Labour government. These were promptly amended by the new Conservative/Liberal Democrat government and there has then been individual local intervention by a number of planning authorities.Planning Classes
Planning is controlled by requiring planning consent for a material change of use.
The definition of “material change of use” is a little uncertain a lot of the time so to make this a little less unwieldy to operate, property use is generally split into planning use classes by one of a range of Planning (Use Classes) Orders.
Where a change of use does not result in a property moving between use classes it is not considered material. Where the use class does change the change of use will probably, but does not have to, be considered as material.C3 Use Class
Most residential property falls into the C3 planning use class.
The C3 use class is now linked tightly to the definition of a House in Multiple Occupation under the Housing Act 2004. The definition now includes a specific section on interpretation making clear that a household is to be interpreted in accordance with that set out in s254 of the Housing Act 2004.
There is no maximum number of persons provided they form a single household. So any property that is not an House in Multiple Occupation for the purposes of s254 will fall into the C3 use class.
Note that this means any property which is an House in Multiple Occupation not just licensable HMOs. So three friends sharing a house will not fall into the C3 use category.
A C4 use class now also exists. For the purposes of Class C4 a “house in multiple occupation” does not include a converted block of flats to which section 257 of the Housing Act 2004 applies but otherwise has the same meaning as in section 254 of the Housing Act 2004.
The C4 class is specifically for HMOs. It uses the definitions of House in Multiple Occupation as set out by the Housing Act 2004 as its basis. Any HMO property, licensable or otherwise, will fall into this use class.General Permitted Development
The Town and Country Planning (General Permitted Development) Order 1995 (GPDO) is designed to allow movement between some use classes without any form of planning consent being required.
It is designed to streamline the process further by allowing certain changes of use, even though those involve changes in use class.
After the 2010 election the incoming Conservative-Liberal Democrat government fulfilled a Conservative election pledge by amending the permitted development order to allow movement between the C3 to C4 use classes without planning permission.
This means that for a lot of smaller HMOs planning is not a serious obstacle.The larger House in Multiple Occupation and Sui Generis Use
Some uses do not fall into any use class. This is known as sui generis use. It would be impracticable to have a use class for every contemplated use and so there are many property uses which are found within this generic category.
As there is no use class there is no automatic exemption from planning consent for movement into this category from an already extant use class or for a change between uses in this category.
Larger HMOs do not fall into the C4 use class and will be within the sui generis category. Therefore they may well need planning consent if they represent a material change of use of the property.
In each case this will depend on degree. So a change from C3 to sui generis may well be a change of use but a change from C4 to sui generis may not be if it is only a small increase in the number of occupiers.Article 4 Directions
However, individual local planning authorities have the ability, as they do with all permitted development rights, to restrict their use in their sphere of influence by issuing a local planning direction known as an ‘article 4 direction’.
This essentially allows a local planning authority to undermine the operation of a permitted development order in its area by requiring planning consent anyway.
An increasing number of local authorities have made Article 4 directions in part or all of their area of responsibility in order to restrict movement of properties from the C3 to C4 use classes.
It should be remembered though that C4 use only permits occupation by up to 6 persons as an House in Multiple Occupation and so any HMO with 7 or more residents will require planning consentMaterial Change of Use
For planning permission to be required there must be a material change of use of the property.
Contrary to the belief of many planning officers, a change in use class does not lead to the immediate presumption that there has been a material change in use, although it is indicative. It is debatable whether every conversion to HMO use is a material change in the use of the property.
A number of planning decisions call into question the assumption that a change in use from a single family dwelling to a House in Multiple Occupation is a material change in use and make clear that each case will need to be considered on its merits.
Most local authorities are fairly clear that a change from single use to HMO use is a material change but it will really depend on the local area, the exact uses in existence and contemplated and the specific planning policy in force in that area.
Where a change from C3 to C4 use is unlikely to have a significant impact then it may well be that a planning inspector will consider the change not to be material.
We will be looking next at the HMO Management Regulations.Further HMO resources:
Advice: If you need some legal advice, for example if you have issues with your HMO tenants and need advice, you can use our ‘HMO Hotline’ telephone advice service.
Training: Easy Law Training has regular workshops on HMO Law & Practice. You can read about these >> here (you will need to scroll down to find out the dates).
I became a member today and, although I have read many articles, this is my first post. Can I say, in opening, what a valuable resource this is. I have one BTL property near Barnsley which is an old (1885) terrace. I bought the property in November 2013 with tenants already in situ. The Home Buyers... Read more
I can distinctly remember my university lectures on mortgages. Not the content – I don’t think I ever really understood that – but the “gap” that existed (and still exists) between the popular understanding of what a mortgage is and what, in law, it amounts to. In particular, I remember being amazed that a mortgage was, in effect, a right to immediate possession of the property, regardless of whether there was any default on the part of the borrower (the right to possession arises “before the ink is dry” as it was put in various cases).
That unqualified* right to possession has come to the fore again in Thakker v Northern Rock Plc  EWHC 2107 (QB) (Lawtel only from what I can see). The facts are quite simply (and, in my experience, common). Northern Rock had lent £242,000 to Mr & Mrs Thakker to allow them to buy a house. There were some further advances so that just over £259,000 was eventually secured against the home. Mortgage payments were missed and possession proceedings issued.
Mr & Mrs Thakker sought to defend (and counter-claim) the proceedings on the basis that they had an equitable set-off, in particular, the bank had been in breach of the Mortgage Conduct of Business Rules made under the Financial Services and Markets Act 2000 (now the Mortgages and Home Finance: Conduct of Business sourcebook – see here). The argument was that the damages could be applied to reduce or extinguish the arrears (and, pausing there, that argument plainly is right).
The bank applied to strike out the defence, contending that it wasn’t a defence to a possession claim, following the decision in National Westminster Bank Plc v Skelton  1 WLR 72, where it was held that:
… the bank’s claim is one simply for possession, not payment. The general rule established by long-standing authority is that except in so far as his rights are limited by contract or statute, a mortgagee by way of legal charge is entitled to seek possession of the mortgage property at any time after the mortgage is executed: see, for example, Mobil Oil Co. Ltd. v. Rawlinson, 43 P. & C.R. 221 ; Barclays Bank Plc. v. Tennet (unreported), 6 June 1984; Court of Appeal (Civil Division) Transcript No. 242 of 1984 and Citibank Trust Ltd. v. Ayivor  1 W.L.R. 1157 .
Faced with this argument the Circuit Judge granted the application; the argument could work as a counter-claim for damages, but not as a defence to a possession claim; the right to possession was absolute. The counter-claim might give rise to sufficient funds to enable the judge to exercise the discretionary powers under the Administration of Justice Acts of 1970 and 1973, but it didn’t impeach the right to possession itself.
An appeal to the High Court was dismissed. In the absence of a contractual provision postponing the right to possession in the event of a failure to comply with the relevant regulatory provisions, there was no basis for saying that the right to possession had not arisen. The judge was fortified in this view by the fact that Defending Possession Proceedings didn’t mention the possibility of such a defence.
Now, this is what I mean about the “gap” between popular understanding and the law. Very, very few people realise that their mortgage company has (unless the contract provides something else) an absolute right to possession, even if the mortgage company have broken all the regulatory codes going (or similar). It would, I think, come as a shock to them to learn that such default by the bank wasn’t a defence to a possession claim per se, but was, at best, a possible source of damages which might be used to reduce arrears so as to bring the discretionary powers of the court into play.
I confess that I don’t really see why mortgage companies should have an absolute right to possession; the modern (residential) mortgage is very different in structure and usage from that found in 1925. Why shouldn’t the mortgage company have to prove some operative default before a discretionary power for possession arises? How is an absolute rule compatible with the rights of the occupier under Art.8 and A1/P1, ECHR (‘tho, I accept, the 1970 and 1973 Acts might solve any incompatability). Perhaps the authors of DPP might consider asking if we can come up with an arguable defence that they could mention in the next edition? :-)
*unless qualified in the mortgage deed itself, but the point is that it is unqualified as a matter of general law
Hello I am a regular reader but this is my first post. We have recently purchased an ex LA (local authority) first floor flat in a 4 storey block of 8 in London. Ours and one other are private, the rest are still LA. The flat underneath us is vacant and we have just had... Read more