Budget boost for home ownership could affect private rented sector

In the budget last week the Chancellor delivered new measures aimed at boosting home ownership.

The benefits include the new homes, secondhand homes and mortgage markets, as well as the ‘build to rent’ sector.

The extensive accessibility of 95% mortgages could have radical implications for the private rented sector, with more tenants encouraged from January to buy their own homes.

Under the ‘Help to Buy Scheme,’ described by George Osborne as a dramatic intervention in the housing market, the NewBuy mortgage guarantee scheme will be stretched across the whole housing market to include secondhand homes.

The scheme will start next January and will run for three years. Over this period, buyers of both new and secondhand homes will be able to purchase a property worth up to £600,000 with a deposit as low as 5% underwritten by a £130 billion government mortgage guarantee scheme.

For the time being, next month, there will be a continuation of the the FirstBuy shared equity scheme to all buyers, not just first time buyers of new homes.

Buyers of new homes up to £600,000 with just a 5% deposit will be able to gain from £3.5 billion ‘pot’ to assist shared equity loans. This means they will be able to get a 20% loan interest free for the first five years, and repaid when the house is sold.

Also announced in the budget, an investment in 15,000 new affordable homes plus a five-fold increase in the Build to Rent fund, which backs institutional investment in new homes built for the private rented sector.

George Osborne is also considering prolonging the “successful” Funding for Lending scheme. He told the Commons that he is currently discussing this with the Bank of England.

The Party Wall Act

The Party Wall etc Act 1996 provides a structure for the prevention and resolution of disputes in relation to party walls, boundary walls and excavations near neighbouring buildings.

A building owner planning to start work covered by the Act must give adjoining owners notice of their proposition set down in the Act. Adjoining owners can agree or disagree with what is planned. Where they disagree, the Act provides a procedure for resolving disputes.

The Act is separate from acquiring planning permission or building regulations approval.

What is a party wall?

The main types of party walls are:

• A wall that stands on the lands of 2 (or more) owners and forms part of building - this wall can be part of one building only or separate buildings belonging to different owners.
• A wall that stands on the lands of 2 owners but does not form part of a building, such as a garden wall but not including timber fences.
• A wall that is on one owner’s land but it is used by 2 (or more) owners to separate their buildings.

What the Act Covers

The Act covers:

• New building on or at the boundary of 2 properties.
• Work to an existing party wall or party structure.
• Excavation near to and below the foundation level of neighbouring buildings.

This may include:

• Building a new wall on or at the boundary or two properties.
• Cutting into a party wall.
• Making a party wall taller, shorter or deeper.
• Removing chimney breasts from a party wall.
• Knocking down and rebuilding a party wall.
• Digging below the foundation level of a neighbour's property.

For more information please feel free to contact us at:

http://www.thelettingangel.co.uk

SAFEagent Saturday!

SAFEagent Saturday is tomorrow! It is a chance to open our doors to the public and landlords to spread the importance of Client Money Protection Schemes.

SAFE (Safe Agent Fully Endorsed) is a mark that shows a firm protects landlords and tenants money through client money protection schemes.

There are various schemes in the sector governed by ARLA/NAEA, the Law Society, NALS and RICS to which agents voluntarily belong. The capacity of these schemes vary and you should contact your agent for full details of the scheme of which they are a part of.

Landlords and tenants frequently make decisions based on cost but it is important to make sure you ask your agent for details of the organisation they are regulated by an whether or not they are covered by a client money protection scheme. All agents who are a part of ARLA/NAEA, the Law Society, NALS and RICS preserve and manage separate designated client accounts where your money is held completely separate from the operating funds of the firm.

If the agent you are using can’t provide you with the certainty of knowing they are covered by a client money protection scheme the question you need to ask is why not?

For more information please feel free to contact us at:

http://www.thelettingangel.co.uk