Estate agents are hiring French-speaking staff to sell property in London

Estate agents are expecting a flood of buyers from the Continent if the euro is left unstable by elections in France and Greece.

Experts say the price of property in some of London’s most exclusive areas is already being fuelled by an apparent exodus of the rich to the UK.

But if the socialist leader Francois Hollande wins the second round of France’s presidential election it is claimed that flow could become a flood.

Francois Hollande has promised a wide-ranging left-wing programme, including a top tax rate of 75 per cent and the creation of thousands of new public sector jobs, including 60000 new teachers. Hollande says he ‘dislikes the rich’ and had already singled out ‘the world of finance’ as his principal enemy.

In Greece public opinion is opposed to further austerity measures in the lead up to Sunday’s election and polls suggest a majority government is unlikely.

Estate agent Knight Frank told CNN that continuing fears the euro could collapse was contributing to the rise in property values in central London.

The brokers said in areas like South Kensington French investors were the second biggest group after British buyers in the first quarter, accounting for 8 per cent of property purchases.

So far this year they say enquiries from French clients have soared 19 per cent.

At nearby Douglas & Gordon demand is so buoyant they are setting up a special French-speaking office.

The new branch is hiring four French staff and will be up and running this summer, just in time for the Olympic Games.

Ed Mead, director of Douglas & Gordon in South Kensington, said: ‘The French have always loved this area but we are seeing more and more.

Despite repeated attempts by the 17 eurozone countries to prop up the single currency, many experts believe the euro cannot survive the coming year intact

‘They like the wide avenues and big apartments this part of town offers but also the quaint mews houses.

To think some of these properties were built as stables for horses originally but they are now they are worth £2-to-£3million but demand is strong and now they are all being redone.’

Greeks have also been ploughing their money into parts of the capital since their country’s first bailout two years ago.

Ben Board told CNNhis family has just accepted an offer to sell their two-bedroom apartment for around £1.6million from a Greek buyer.

‘We had very strong interest. Perhaps 200 requests to view the flat, mainly from Southern Europeans,’ said Mr Board.

British officials believe that one or more countries, such as Greece and Portugal, could be forced to drop out of the single currency in order to tackle the dire problems in their own economies.

Ministers fear the break-up of the euro could have a devastating effect on Britain, dashing hopes of a recovery and sending the economy back into recession.

The Treasury, which has a central role in drawing up contingency plans for the euro’s collapse, believes a break-up could send international investors scrambling for a safe haven.

The transfer of huge sums of money to London could send Sterling soaring – threatening to crush the fragile recovery in exports which is central to the Coalition’s plans to ‘rebalance’ Britain’s economy.

Earlier this year the Swiss government was forced to intervene after nervous investors transferred cash there from the Eurozone, sending the value of the Swiss Franc to unsustainable levels.
The Swiss authorities moved to peg the currency to the euro.

By Leon Watson UPDATED: 14:49, 4 May 2012

Read more: http://www.dailymail.co.uk/news/article-2139537/French-Greek-elections-spark-property-boom-London-rich-buyers-flood-UK-escape-euro-crisis.html#ixzz1tzaqrWnJ

New rules mean that landlords must comply with tenancy protection requirements, including the need to give prescribed information. If you fail to do this, you face financial penalties and the loss of the right to use Section 21.

The new rules apply to all new deposits taken on or after 6th April 2012 AND they are also back dated to all existing deposits held on that date which should have been protected (unless the tenancy has already ended no later than 5th April 2012). There is a short period of grace to put matters right in respect of existing deposits where a landlord has failed to comply with the requirements.

Landlords have until 5th May 2012 to put right any existing failures to comply with deposit requirements.

To ensure you comply the RLA has published a number of guides and check lists at the following website links:

• Frequently      asked questions
• Detailed      information about Tenancy Deposit penalties and Section 21
• New deposit      rules check list
• Instantly protect      your deposits or register your interest today at www.rla.org.uk/depositguard

The RLA low-cost deposit protection service allows you to protect deposits from as little as £15 and keep hold of the deposit. This is exclusive to members so join today to register for free and start protecting your
deposits straight away.

This is how it works…

Nationwide figures suggest UK housing market is reviving, but building society says rise could be temporary

The Nationwide building society said today the price of a typical home in the UK is now £162,712.

(Reuters) – Harriet Howse is one of many Londoners looking to make a profit out of their property during this summer’s Olympics, leaving the city and their homes to strangers to avoid the anticipated mayhem of an overcrowded capital.

One property website’s survey says an estimated one-in-three Londoners are considering packing their bags and moving in with family and friends or heading abroad when 11 million sports fans, media and corporate clients descend on the capital for the world’s biggest sporting extravaganza.

You don’t have to hate sport either to be thinking about moving out.

Behind her blue door in northeast London, Howse, a fan of tennis who keeps herself fit, is planning to move out of her four-bedroomed terraced house and stay with her family. A housemate will be travelling to Japan.

“The cost of the tickets was so high that we couldn’t afford to put a bid in for any of them … and I think the mayhem and chaos caused by the Olympics would be a good reason to get out of London,” Howse told Reuters.

“I’m pro-Olympics but I think the crowds are going to be crazy.”

Her minimalist house, with its neutral colours alleviated by orange sofas and large paintings, is expected to fetch up to 2,000 pounds per week, four times the rent the 26-year-old university international officer could normally expect.

Other London homeowners are looking to ask for six times the usual rate.

A survey by property website FindaProperty.com last year estimated the total Olympics rental market for flats, apartments or houses could be worth 314 million pounds, based on one-in-three homeowners considering letting out some or all of their properties.

Estate agents say the number of short-let clients on their books has risen sharply.

Even high-end service specialists such as onefinestay.com, which handles properties typically worth 1.5 million pounds, is receiving between 100-150 calls a week from people looking to rent out their property during the Games.

“We’re expecting it to be by far the busiest time we’ll ever have had,” said Greg Marsh, co-founder of the site.

“People are going to be taking off for the period of the Games in order that they can earn a bit of extra income while they are away.”

WEST IS BEST FOR AMERICANS

Renting can prove attractive for visitors because it offers more flexibility while prices are likely to be cheaper than London’s notoriously expensive hotels.

“You could have a bowl of cornflakes for breakfast and you don’t have all the associated costs of living in a hotel,” said Sarah Tonkinson, lettings director at estate agents Foxtons.

Block booking has reduced the number of available hotel rooms, with the danger that it will push up prices, though London Olympic organisers (LOCOG) recently released more than 120,000 unwanted hotel room nights for resale.

Some hotels are reportedly holding customers on long waiting lists before releasing prices, but some tour operators have said the industry’s expected visitor numbers are hugely inflated.

The trick for both hoteliers and homeowners is getting the timing right when looking to charge a premium.

“It’s better to take something at the lower price earlier and know you have definitely got something secure rather than run the risk and try to achieve a higher price later on,” said Darren Rebeiro, head of Olympic services at Keatons estate agents.

Prices advertised before the Sydney 2000 Olympics were seven times the market rate.

“I think it is unlikely anyone achieved that,” he said.

Renting is proving popular with foreign media, security firms, embassies and athletics federations, some of whom will look to book 200 rooms at a time. Others who are renting are corporates, especially from the U.S, Asia and Russia.

Demand has focused on historic Greenwich, with its maritime history and open spaces as well as its proximity to the equestrian events and other Olympic riverside venues.

One seven-bedroom property is on the market for 24,000 pounds per week.

Other popular areas, especially among Americans, include west London, with its upmarket shops, museums and luxury properties.

Wills Thomson, 48, is renting out a room in his two-bedroom flat in Chelsea to a father and son who booked last year on Crashpadder.com.

The archivist said it was an opportunity to meet “charming people from all walks of life from around the world” as well as earn a little pocket money.

“It’s like staying with a friend of a friend, though they are paying for that privilege,” he said.

Stephen Rapoport, founder of Crashpadder, said he expected to double the site’s 2,100 hosts by Games time, while bookings were up by 245 percent compared with the same period last year.

BUY-TO-LET BONANZA

People living in Stratford, gateway to the Olympic Park, are also looking to cash in.

But estate agents in the formerly run-down part of east London, once home to noxious industries and slaughterhouses, are warning locals they may not be sitting on gold mines.

They urged caution against the expectation among some that “Mr and Mrs American” would be prepared to pay bloated rents for their properties.

Residents are likely to lose out to developers and buy-to-let property tycoons who moved in after London was chosen to host the Olympics, investing in new modern luxury apartments, which are proving more desirable.

“It’s going to be the investors that earn the money,” said Daniel Barbanel, sales and marketing director at local independent residential property agents Outlook.

“Because ultimately, the local people — with respect to them — their houses and flats aren’t particularly well decorated.”

Nearly four years after regulators first responded to complaints, the remaining firms have stopped selling the controversial deals.Distressed home owners would sell their homes at a discount to firms that then promised to let them stay as tenants.
The FSA said most deals “were either unaffordable or unsuitable and never should have been sold”.
The Office of Fair Trading (OFT) investigated the industry in 2008 after tens of thousands of home owners sold their homes to companies offering them tenancies as an alternative to being repossessed.The regulator estimated at the time that about 50,000 such deals had been struck, and concluded that the industry, which had more than 1,000 firms involved, should be regulated.
The OFT found that home owners who entered such deals might be cheated if they were misled into believing their tenancies might last for a long time, or if their rents were subsequently increased to levels they could not afford.

Proper regulation
The FSA took over formal regulation of these businesses in 2009 and has, in effect, scared most of them off.Since then there have only been 61 such sale and rent back transactions.Rules brought in by the FSA in 2010 laid down that any new deals had to offer a tenancy lasting at least five years. Only 22 firms stayed in the market, but the FSA said that one way or another they had now all stopped doing business.

“The FSA has referred one firm to its enforcement division while others have either stopped taking on new business or cancelled their permissions,” the FSA said.

“Effectively, this means the entire sale and rent back market is temporarily shut,” it added.

Fraud
Despite new rules and formal regulation, a subsequent FSA investigation of the 22 authorised firms starting in March last year found a litany of failings and poor practice that had continued to put customers at risk. Among the problems had been inappropriate and unaffordable deals, failure to discuss key facts with customers, incorrect information, breaches of the FSA’s rules on financial promotions, and poor training, record keeping and levels of competence.

Nausicaa Delfas, of the FSA, said: “The resulting temporary closure of this market could have been avoided if sale and rent back firms had taken the time to fully understand their regulatory responsibilities and customers’ needs.It seems most were more focussed on their own commercial success rather than the welfare of the customers, with one firm even resorting to fraud.”

Redress?
Customers who took out a sale and rent back deal before the FSA started regulating the industry will not have the benefit of financial protection from the FSA and the Financial Services Compensation Scheme (FSCS) if things go wrong.

Peter Vicary-Smith, of the consumers association Which?, said: “It’s welcome news that the FSA has taken action to stop people falling prey to shoddy advice from sale and rent back firms. Which? exposed the shortcomings of this market last year, after our own investigation uncovered woefully inadequate advice.We now want to see redress for those consumers who have been given poor advice by sale and rent back companies, and for this to happen quickly.”

People thinking of investing in buy to let property may find that focusing on the north of England is the best bet, according to one expert.

Tanya Powley, of FT Money, said there are some areas and towns where landlords can actually get “a very high yield”, with the highest being 7.6 per cent observed Burnley. She noted that a lot of the higher buy-to-let yields tend to come in the north of England where obviously there are lower house prices, but on average London is about 5.1 per cent, south-west is 3.8 per cent, and in other areas like Wales it is around 4.4 per cent. However, she explained that not every area is achieving very high yields, pointing to the recent announcements by some mortgage lenders that came into the market and started offering 80 per cent loans, which is by far the highest loan value available the buy-to-let market at the moment. “Even though this is a great headline grabbing thing for these lenders to be offering 80 per cent loans, it is probably going to see quite limited take-up because not many landlords will be able to achieve high enough yield to have access to that 80 per cent borrowing,” Ms Powley stated.

Tips when viewing Victorian properties

David Lewis of chartered surveyors Grillo LLP (grillollp.com) offers his expert advice on what to look out for when viewing a Victorian property for sale.

• The Victorians used cavity walls to fight damp and improve insulation. Builders used various methods to tie the two leaves of masonry together but the most common was the iron tie. Check them for signs of corroding, which can lead to instability, unevenness and cracks in external walls.

• Damp proof courses in walls were typically formed with slate or pitch and sand. Frequently, they were built too close to the ground, meaning they became covered by earth and paving, making them ineffective.

• Lead was commonly used for the underground pipes. Now we know that lead deposits in drinking water can damage health, so all lead pipes should be replaced.

What can let to buy offer?

The bottom line is that let to buy can offer an escape from the sometimes drawn-out procedure of selling one home to buy another, including during times when the housing market is weaker or when there are more than the average number of homes for sale on the market.

Let to buy allows for a speedier moving process because the move is no longer so dependent on the sale of your existing property, thereby avoiding lost opportunities to buy that dream house. It also offers the distinct advantage of giving you a regular income from the rented property and an investment for the future should you choose to continue with the arrangement in the longer term. In addition, it is an excellent basis from which to start building a property portfolio to act as a long-term pension plan.
 
Today, in the UK, the lettings market is strong with young people forming the backbone of the rental sector. On average, first-time buyers are in their thirties but, since most people leave their parental home in their early twenties, there is a decade in which they will want a property to rent before buying. Business people who move when their firms relocate also rent. Good news for those looking to let to buy as what could be better than someone else effectively paying your mortgage for you!

Tenants who live in the coldest privately rented homes that haemorrhage heat through the walls, windows and doors are trapped into higher fuel bills because they rely on landlords to make their properties energy efficient.

Citizens Advice and Friends of the Earth have called on private landlords and Government to take action on energy inefficient homes that are costing tenants hundreds of pounds a year in wasted energy.

According to the Energy Saving Trust (EST), around 680,000 private tenants who live in the coldest homes (those in with an energy rating of F or G) fork out on average £488 per year on wasted energy and over 40% of these tenants are in fuel poverty.

Landlords are currently required to have an Energy Performance Certificate (EPC). The certificate rates a property’s energy performance from A to G and can give you an idea of how expensive it will be to keep warm and how it can be improved.

From 2018, it will be an offence for landlords to let or market a property that falls below an EPC rating of Band E. Citizens Advice is urging the government to bring this forward to 2016, a move it says would save tenants in the worst insulated properties up to £1,000.

“People are desperate to make their fuel bills cheaper, but if you live in a privately rented home there is a limit on what you can do to stop heat seeping from the property and racking up a huge energy bill,” said Gillian Guy, chief executive at Citizens Advice.

“Rising rent and hikes in fuel costs are busting many people’s budgets. So landlords need to speak to their tenants about what they can do together to make their home warmer – and their fuel bills cheaper.”

Citizens Advice says that, depending on their circumstances, private tenants may be entitled to free or heavily discounted insulation. As the tenant pays the fuel bills, it’s the tenant who would get the free insulation. However, an insulated property benefits the landlord by adding value to their property.

To get insulation installed, tenants will need written permission from their landlord but, in many cases, Citizens Advice says the supplier can apply for this on the tenant’s behalf.

Tenants should check with their energy supplier, or see if there are any government or local authority schemes they may be eligible for. Or check the Energy Trust’s website

“With regard to other areas of the UK I think rents will be relatively stable and increases are likely to be very modest. Landlords should be realistic and it is worth noting that many areas have still not recovered to the level of rents that were being achieved in 2008.

“I predict that increased rents and stable or decreasing house prices will result in increased rental yields in 2012. However, this is clearly very dependent on the outcome of the Eurozone crisis and its impact on credit and borrowing. The current crisis is making consumers nervous, which will affect both the BTL and mortgage market.

Double renting
“A recent phenomenon noted by Belvoir agents across the country is that of ‘double renting’ – where homeowners who are struggling to sell are now letting out their existing home to provide an on-going income stream, and then moving to another lower cost rental property. Double renting helps to avoid the stamp duty and legal costs that are associated with buying and selling and enables homeowners to remain ‘invested’ in the property market until the situation improves and they can sell at a profit.

“I believe that for reasons of flexibility, mobility and budget, 2012 will see a shift towards more people viewing renting as a preferred lifestyle choice rather than a necessity. By renting a property people are able to plan their spending much more accurately and have the flexibility to follow job offers etc. These factors are becoming increasingly important, particularly in the current financial climate.

“Because of the regional variations in rental yields it is very important for landlords to talk to specialists who understand the local market, as buying in the wrong area could be very costly. Belvoir has 140+ offices spread across the UK and we are able to report on regional markets rather than providing a broad-brush approach, which is not particularly helpful from a property investment perspective.”

Regional round up

Area: East Midlands
“The region initially slowed at the start of 2011, with enquiries from tenants and landlords on a downward trend. Rents appeared to hold, but there was a reduction in yield from two years ago. The spring brought a steady enquiry stream throughout the region except for specialist BTL enquiries, which seemed to all but disappear.

“In July demand for student properties in Nottingham saw a massive surge, resulting in a 10% premium on rents compared to the start of 2011. In Nottingham we were left with only a handful of properties ready to let instead of the normal 40+ units at the end of September.

“We predict that 2012 will be a difficult year, as the impact of job losses result in increased inability to pay rent. Rental arrears will put pressure on landlords that were given a reprieve from mortgage rates in 2008 by a base rate of 0.5% and just managed to keep their head above water. We predict a second wave of mortgage repossessions in early 2012, especially if the base rate increases – even by a small margin.”

Area: West Midlands
“Most Belvoir agents in the West Midlands Region are experiencing an increased demand for two and three bed houses, and are struggling to keep up with new supply.

“In August and September there was a demand for property of all sizes, but this has now slowed, especially in demands for four beds+. This could be a result of the consistent economic `bad news` stories that are pumped out daily by the media.

“Stratford-upon-Avon saw a sharp slow down in November, after a record October. We always experience a seasonal slow down, but we are much quieter now than in November 2010.”

Area: South East 
“In the South East the market has continued to be strong rent-wise, with good competition for properties, particularly at the smaller level (one & two beds).

“Smaller investment landlords are starting to make the right noises but some remain hesitant on finance options. However, larger builders have continued to develop once dormant land sites, which are letting well to mature tenants.

“In 2012 I believe there will be continued good demand for £500 to £1200 level properties, with larger properties £1500+ sticking as tenants become fearful of higher rent outlay in the economic climate. Some may downsize or negotiate more flexible contracts. The biggest challenge is likely to be attracting stock, as some estate agents will reduce fees for letting to make up for the static sales market.”

Area: South West 
“Over the last six months we’ve seen a shortage of family homes. Two and three-bedroom houses are renting well but the big-end luxury stuff hasn’t really been moving.

“We’re finding that tenants are staying a lot longer in properties, so we’ve had fewer move-overs than in previous years. If anything, there’s a shortage of tenants moving in our area at the moment and properties are starting to stack up a bit.

“Monthly rental returns peaked about March/April time and we saw a bit of a ‘soggy’ summer. We are telling landlords who want to let quickly to be really realistic with rents and some landlords are now slashing rents to get tenants in.

“Over the last six months the biggest challenge has definitely been increased competition from estate agents who are cutting fees. I think 2012 will be tough. Many landlords are adamant that rents are on the up and our biggest challenge will be educating them about the realism of the market.”

Area: North West 
“We experienced significant tenant demand during the summer. This resulted in a record numbers of lets, but a significant reduction in stock and rental prices remained static.

“During October and November, tenant demand decreased and stock levels rose with a further wave of accidental landlords. There has been increased activity from investment landlords, as property prices remain depressed. As the local economy shows signs of further deterioration, a growing number of landlords are seeking to reduce costs. In 2012 the majority of landlords will seek to consolidate their positions and continue to place emphasis on value for money.”

Area: Scotland
Nick Horan of Belvoir Dundee says: “In Scotland I would says that generally rents are not rising massively and in some places, including Dundee, they are completely static.

“Across the market we’re seeing longer tenancies with less churn through of tenants and not massive increases in rents outside of the central bands. Things are going well, though, and accidental landlords are on the increase.

“The biggest challenge in Scotland over the last six months has been increased legislation – there has been a massive amount and more is planned for next year too.

“The outlook for 2012 will depend on the wider economy, which isn’t wonderful. I think we will see an increase in lettings and the availability of tenants but rents will remain static. I definitely don’t think rents will shoot through the roof – but this will vary from area to area.”

Area: Northern Ireland 
“The rental market has performed pretty well over the last six months. Demand was good and rent values remained stable – they may even have nudged up slightly in certain areas.

“Towards the end of 2011 the market dipped off significantly, but that’s not uncommon at this time. Overall I’d say that with regard to the rental market things have been very positive. The property sales market in Northern Ireland is very depressed and I believe that the positivity about BTL will continue into 2012. We are seeing many repossessions coming on to the market, which will probably hold values down. As a result it is likely that people will be deterred from buying because they are unable to access finance or save deposits and will turn to the rental market.”