10 Mar 10  The lack of supply of good quality country houses, which has been a major feature of the country market for over 12-months, will ease in the weeks prior to a General Election which is widely predicted for 6th May; according to Prime Purchase.
Jonathan Bramwell, Head of Country at Prime Purchase says: “The shortage of prime country houses in all locations has been an important factor in holding prices stable and in some areas has caused price increases. However, there is now a perception that the General Election may result in a ‘hung Parliament’ which will struggle to cut public spending and to make the economic reforms required to allow the UK economy to recover”.
Consequently, Prime Purchase is expecting a significant number of vendors, who have delayed putting their properties up for sale, to enter the market before the election.
“We sense that estate agents have a growing stock of properties coming forward which will hit the market over the next 6 to 8 weeks. This is being driven by vendors’ concerns that the country market, post–election, will not deliver any higher prices than can be achieved now”, says Jonathan Bramwell.
Another concern is that a hung- parliament and minority government would result in a downgrading of the UK status by international ratings agencies. This would result in a further weakening of the pound and push up the cost of imports, increase inflation and start a chain of interest rate rises.
William Marsden-Smedley of Prime Purchase comments: “Given the projected economic scenario resulting from a hung parliament, most vendors are thinking of entering the market sooner rather than later. However, we do not believe buyers will disappear post-election because there is a good degree of pent-up demand. Our clients are buying for the long term, are generally not reliant on mortgage finance and are not likely to be affected by interest rate rises”.
Single Farm Payment Entitlements Availability has been updated
http://www.cdproperty.co.uk/quota/sfp_available.html 3 March 2010 Regulation of the property sector continues to be much debated as it lurches towards becoming a reality. But until there is a robust mechanism of redress in place, with the teeth needed to weed out unprofessional practice, landlords and vendors looking to instruct an agent can very easily get their fingers burnt… Until significant reforms are made, the age-old question remains: How do you separate the most reputable professionals from the rogue agents that give the sector a bad name? Award-winning London-wide agency, Young London (www.younglondon.co.uk), offers its top tips to help landlords identify a reputable sales or letting agent. · Play web detective · Standing out from the crowd · What are they marketing? · Test the agent · Don’t be afraid to ask · First impressions really do count · Avoid hidden charges at all cost · Lettings retention and renewals · How do they manage? Play web detective Take the time to play web detective and fully research the agent’s website. It is a good start to see if they are members of any professional associations, if they have won any awards and whether their information is easily navigable, up to date and accurate. Standing out from the crowd With more than 80% of house hunters turning to the web for their property search, online marketing has never been more important, but it takes more than just signing up to property portals to keep ahead of the competition. Does the agent use twitter or facebook to share property with a wider audience and do they advertise directly online or is your property left languishing, lost on the portals? What are they marketing? Agents listing properties similar to yours should have a clear idea about rental and sale values, a greater understanding of the local area, and potentially a long line of registered applicants already seeking property in comparable areas and price brackets! Test the agent A quick way of testing if an agent is worth their salt is simply asking them about Home Information Packs, Energy Performance Certificates, Gas Safety Certificates and Tenants Deposit Protection. A good agent should be able to talk about these confidently and explain your legal obligations when selling or letting. Don’t be afraid to ask! Prepare a checklist of questions; make sure the agent is knowledgeable about the market, questioning them specifically about any local amenities the area has to offer, the demographics of the target market and how well your property would fit into this. You’ll also want to check what the demand is likely to be and how quickly they think they can sell or rent your property. First impressions really do count Is the agent responsive and do they follow up your enquiry with an informed answer? Their initial contact could well be indicative of their professionalism and how the business is run so first impressions really do count! Avoid hidden charges at all cost Avoid getting stung by hidden costs; any reputable agent should be transparent and upfront about their fees from the beginning. Don’t be tempted to go for the cheapest agent you come across; make sure you are clear on their charges and investigate the full range of services and the quality of service they offer. Lettings retention and renewals If looking for a lettings agent, do the tenants generally stay for the duration and how many tend to renew their tenancy? In terms of renewals, remember, the agent should be negotiating on your behalf to achieve the best possible rental and aim to avoid renewals coming at a point in the year when demand is low (e.g. close to Christmas). How do they manage? Any letting agent with a strong property management team should have reliable contractors to relieve any potential headaches. Are their maintenance firms members of any professional bodies. Ask them to advice on the cost of typical maintenance jobs and how soon they would expect to have someone on site after a reported problem. About Young London (www.younglondon.co.uk) Winner of Gold Award: Best Small Lettings Agent in the UK at the
Sunday Times’ Estate Agency of the Year Awards Young London Office Details: Online: www.younglondon.co.uk Email: info@younglondon.co.uk Twitter: www.twitter.com/twitter Phone: 020 7593 3300 on 17th March 2010 at the Kassam Stadium Guest speaker is Reena Malra on her 'Lease Option strategy' and Yvonne Emery on her 'Unique aproach to Property Investment' For more information go to http://www.oxford-property-network.org.uk
09 Feb 10
With the price of UK farmland predicted to continue rising, according to leading land and estate agents, the benefits of investment in rural land and property are now being widely reported. Land values were up by an estimated 11 per cent in 2009 with a further rise of 9 per cent forecast for 2010 . And there are predictions from land agents that by 2015, farmland could double in value from its present average level of around £5,000 per acre.
Mike Harrison of Saffery Champness Landed Estates and Rural Business Group answers some of the queries that are often raised about UK farmland investment:-
How is farmland defined for tax purposes?
“HMRC recognise farmland as being land occupied wholly or mainly for the purposes of food production either via the growing of crops for direct or indirect consumption or for the rearing of livestock, or both. For Inheritance Tax purposes, it is worth remembering that farmland is extended to include woodlands (on the farm) and any buildings used in connection with the farming business, the occupation of which is of a ‘character appropriate to the farmland’. This can include farmhouses, cottages and farm buildings”.
Is farmland a suitable investment?
“While the demand for farmland is influenced by a lack of supply and substantially driven by existing farmers, there are several good reasons why an investment in farmland may be appropriate from a tax planning perspective for traditional farming families and for so-called ‘lifestyle’ farmers alike. Indeed it is non-farming buyers that in recent years have competed with farmers in purchasing farmland thus pushing prices upwards.
“Both landownership and farming of land are inherently long-term business activities that have passed down from generation to generation. While, historically, capital taxation has been adverse to landowners there are now capital tax reliefs that can mitigate this and which make an investment in land seem attractive to non-farming buyers”.
What inheritance tax reliefs (IHT) are available?
“The two principal reliefs from IHT are Agricultural Property Relief (APR) and Business Property Relief (BPR). Both of these reliefs are subject to certain ownership conditions, and operate by reducing the value of qualifying assets that are liable to IHT”. The reductions for let land are as follows:
• 100 per cent for property, farmed under a tenancy which commenced after 31 August 1995.
• 50 per cent for most other tenanted agricultural land
For let farmland the reliefs available at the applicable relief rates are only given on the agricultural value of the property concerned, which may be lower than its market value; for example where there is a possibility of future development or amenity value attached.
Where the property is used in-hand the relief will be available, at the rates detailed below, on the market value rather than just the agricultural value.
• 100 per cent for interests in business assets owned by a sole trader or by a partnership with shares in private companies carrying on a farming business
• 50 per cent for land, buildings and certain other assets used in a farming partnership or company, but owned personally and not otherwise covered by agricultural property relief.
The business structure is of great importance if the maximum relief is to be available as property held outside the business structure is only eligible for the reduced relief.
“The availability of APR on the farmhouse is unique, reflecting the close involvement of the farmer with the business. However, this means that the appropriateness of the farmhouse is closely scrutinised by HMRC”.
What are the ownership conditions?
“To qualify for APR, the farmland must either have been owned by the farmer for seven years and used by someone else, e.g.an agricultural tenant, for the purposes of farming, or have been farmed in hand by the farmer for two years,
“The ownership of land has often been linked with tenancies, as this allows the landowner to divest himself of the management of the farm. However, capital tax disincentives have encouraged new vehicles for carrying on farming on the farmland, such as contract farming and share farming. These agreements need to be carefully structured so as to allow the landowner to be treated as a farmer by HMRC”.
What capital gains tax (CGT) reliefs are available?
“If the farming is in hand, whether contracted or not, then there are three valuable CGT reliefs are available when the property is sold or transferred:
Rollover relief - on the replacement of land and farm buildings with other qualifying business assets and vice-versa
Holdover relief - on giftsEntrepreneurs’ relief on certain qualifying disposals ‘Entrepreneurs’ relief was introduced as a change to the CGT rules on 6th April 2008 and gives an effective tax rate of 10 per cent on certain business disposals, up to a lifetime limit of £1 million of gains per individual”.
What about the Capital Gains Tax (CGT) treatment of entitlements?
“Farmers purchasing land following the introduction of the single farm payment (SFP) regime on 1 January 2005 should be aware that part of the cost could relate to the purchase of SFP entitlement, which is separate from the land. The disposal of SFP entitlement is treated as a separate asset for capital gains purposes”.
Are there special income tax rules?
“Yes, there are income tax rules for farmers that reflect the special nature of farming and rural business. These are:
• rules to treat all farming as one trade, even if the farms are in different areas
• the ability to average a farm’s financial results between tax years, if this reduces the tax liability
• an election to treat a herd of breeding animals as a capital asset rather than trading stock
• Some relief for losses against other income
“It’s important to note that HMRC considers that farming attracts investors because of the lifestyle it offers. However, it has specific legislation which disallows farm loss relief against general income if the farm has made losses in the five previous years. This is in addition to the restrictions applicable to all trades where HMRC perceives that the trade is not being conducted on a commercial basis or where there is no active involvement by the taxpayer”.
Saffery Champness considers that farmland is an attractive long-term capital tax shelter for individuals especially those wishing to mitigate their exposure to Inheritance Tax provided the property is held in an appropriate style and operated in a manner that will enable relief to be claimed on its market value.
i Source: Knight Frank Rural Research 28 January 2010 The first month of the New Year has sparked renewed vigour to find that perfect pad, award-winning London based estate agency Young London (www.younglondon.co.uk) offers its top tips to get the best out of a property viewing. Neil Young, CEO of Young London explains; “January has seen house-hunters hitting the streets in record numbers as the rental market becomes increasingly competitive and more tenants than ever are chasing fewer available properties. Young London is currently receiving four times the number of tenant enquiries than in January 2009. So those looking to secure themselves the perfect property need to be focused and well organised.” These are Young London’s top tips for successful viewings: · Arrive Early · Take someone with you · Prepare a checklist of questions · Question occupiers · Take a camera · Look past furnishing · Visit at different times of day · Visit in daylight hours · Look around communal areas · Investigate parking options · Research transport links · Check tenancy deposit scheme · Research the letting agent Arrive early Get there early to explore the area around the property, allowing yourself plenty of time to get a feel for your potential new neighbourhood, its character, what transport links are available and any amenities it has to offer. Take someone with you Be safe and take somebody along with you; not only will your viewing buddy be able to offer an impartial second opinion, they could also notice something about the property, or ask that vital question you might have missed. Prepare a checklist of questions Don’t be afraid to ask questions; be organised and make a checklist of all questions to ask and keep notes listing the property’s features, fixtures and fittings, any further expenses, characteristics of the surroundings and your immediate impressions. This will prove extremely useful when weighing up its pros and cons, and provide a benchmark for other viewings you might have. Question occupiers If possible, talk to the current occupiers who will be able to tell you first hand about the property and answer any questions you have about the local area. It is also worth asking how long they have lived there, why they are leaving and what the neighbours are like; depending on their response, you might just find out if it’s to get away from a neighbourly dispute or even the property itself! Take a camera Memory can be unreliable but the camera never lies! It tends to be either the very good or bad points that stick in the mind; taking a camera with you will help you to have a clear, objective aide to remember the property by. Look past furnishing Don’t let the existing occupant’s furnishing put you off and try to see past any current clutter and focus on the size and layout of the rooms. Make sure you know what furniture is included in the agreement and if you are taking your own furniture, have the measurements with you to give yourself an idea of how it might fit. Visit at different times of day Even the dream home can change significantly at certain times of day; try to go back for a second viewing at different time, bearing in mind that the seemingly quiet street could turn into the local rat run at rush hour, or that the inviting local could eject noisy revellers on your door step come closing time. Visit in daylight hours Places can look significantly different in natural light, and a visit during day light hours is recommended; any interior problems will be made more obvious and you will be able to gauge how much light the property gets. Look around communal areas Don’t forget to have a good look around any communal areas; if you are viewing a property in a development, it is worth taking note of their appearance, how well maintained any grounds are and how regularly rubbish is collected, for example. This will give you a good idea of how well the block is managed. Investigate parking options Investigate what the parking situation is like; it may be the case that a space is included in the rental, although in large towns and cities, it is more likely that a permit scheme will be in operation and possible that you will be able to buy a residential parking permit from the council. Research transport links Look into all transport links and work out the distance and best possible route from the property to your place of work; a trial run in peak times could be a helpful exercise to determine whether the commute would be practical or more of a daily grind. see Traveline across the UK Check tenancy deposit and inventory provision For rental properties, ask the landlord / agent about what they have in place in terms of a tenancy deposit scheme; it is essential from the start that a clear agreement is made on protecting your deposit and noting the condition of the property to avoid any potential disputes. Research the agent It is important to make sure you are dealing with a reputable estate agency; looking at their website is a good start to see if they members of any professional associations, if they have won any awards and whether their information is accurate and up to date. Question the agent to see if they are knowledgeable about the property and market in general. If you’re looking at a rental property, ask whether the agent will be managing and if they aren’t it is worth finding out who will be. |
