Categories
Tips

Adding value to your home

We’ll start with extensions. If you do have access to a chunk of savings, or home improvement finance options, an extension is a great option. We have a full guide to extensions here, as there are so many options. From single storey to double storey, side, back or wraparound, the key to consider is what the extension will add to your home. Desirable features for buyers are often multiple bedrooms, an open plan kitchen-diner, and particularly in the current climate, office space. Think about why an extension would be appealing to your buyers. For example, if you live in a great school catchment, look at adding bedrooms to appeal to growing families.

If you don’t have the space to extend outwards, you may well have unused space ready and waiting above or below you. Loft and basement conversions are great options to use the empty space you have available and turn it into a functional extension of the home. Attic bedrooms are a great addition, adding thousands in value to your home, and extending the pool of potential buyers from couples looking for a 2 bed to growing families needing a good 3 bed home. There are of course considerations, such as roof height, access and light, but that’s where the experts come in. As with any alteration, it can be costly, but if you have a good sized space you think can turn from unused to functional, loft and basement conversions are definitely something to consider.

We’ll go down to some smaller, but still very impactful, updates you can make. Quality kitchens and bathrooms are pretty much always of interest to buyers. The kitchen to us is the heart of the home, and bringing it up to a better standard can seriously pay when it comes to the value of your home. According to the Royal Institute of Chartered Surveyors (RICS) a new kitchen or bathroom can add around 4% to the value of a property. As key areas of the home, a modern yet functional kitchen and bathroom is a key factor new buyers will look for, and can be done on a whole range of budgets.

This may seem simple, or may even be something you’ve overlooked, but if you don’t have double or triple glazing then get it done! Thermal upgrades are important for a significant number of homeowners, with double or triple glazed windows and doors seen as essential items, and not having these could really lower the value of your property. If you haven’t added these, along with roof and wall insulation, it’s something we’d definitely recommend looking into to add value to your home. Not only are they desirable features, but they’re key to reducing ever growing household bills.

Along with basic thermal upgrades to reduce bills, we believe more environmentally friendly choices will continue to soar in popularity among homeowners and prospective buyers. Solar panels and ground source heat pumps are just some of the improvements you can make, and whilst initially appearing costly, they can significantly reduce the costs associated with your home and increase the value of the property when you come to sell. There are a number of environmentally conscious materials coming to the fore in property and it’s definitely something for sellers and buyers to consider moving forward.  

As always, get in touch if you want to discuss your options. We’re brimming with ideas and offer a range of services from surveying to architectural design to really help you get the most out of your space.

Categories
Beginners Guide Tips

The House Purchase Process

After weeks spent scrolling Rightmove and Saturdays spent on house viewings, you’ve finally found a property you LOVE so it’s time to get that offer accepted and move forward with your purchase.

If this is your first home or it’s just been a while since you last sold, we’ve put together a guide to the process of buying a new home to make things a little clearer for you and take some stress away.

  • Search for your new home

Before you begin searching, make sure you’ve saved enough for your deposit, have checked how big a mortgage you can borrow from the bank, and are sure you’ll be able to afford the repayments.

Speaking to a mortgage advisor can really help you understand how much you can borrow, and aid you arranging an agreement in principle from a suitable bank so you understand what price range you can view and how much you can offer.

  • Make your offer and have the house taken off the market

Give as much detail as possible when making your offer. The estate agent will want to know you can definitely afford the offer you’re making, and other factors may be of interest to the seller such as if you’re a first time buyer or if you’re in a chain.

Some agents will do it automatically but others may not so make sure to ask to have the house taken off the market as a condition of your offer. If not, you could end up ‘gazumped’, where another buyer offers more money than you and the seller backs out of your deal.

  • Instruct a conveyancer (solicitor)

Once your offer has been accepted it’s time to instruct a conveyancer and really get the purchase moving. A purchase is typically advised to take 8 weeks but there may be holdups along the way that can make the process longer by a fair few months. We’d advise keeping in regular contact with your solicitor to make sure you know what’s happening and when.

  • Apply for your mortgage

You should already have your mortgage in principle but it’s now time to apply for the real thing. If you’re using a mortgage advisor, they’ll prepare you and ask for the relevant documentation, but if not, ask the bank you’re applying with what you’ll need such as bank statements, pay slips (or accounts if you’re self-employed), identification and proof of deposit.

The bank will very likely carry out a valuation survey at this point, but remember this is not a building survey and will not highlight issues beyond high level observations which might affect the value. The valuation surveyor here is working on behalf of the bank so to get a thorough overview of the property from someone impartial, make sure to instruct a Chartered Building Surveyor.

  • Instruct a building surveyor

Make sure this one is on your list early on. It’s so important to really understand the property you’re buying, this is probably the biggest purchase you’ll ever make. Instruct a Chartered Building Surveyor accredited by the Royal Institution of Chartered Surveyors (RICS) to conduct a homebuyers report or a full building survey. We have a full guide to which survey is best for you here but do get in touch with any questions.

A Chartered Surveyor will be working for you and only you to ensure you fully understand the property you’re buying and any issues it may have. They’ll spend time at the property conducting a visual inspection of all internal and external areas so they can explain any issues and advise on remedial works. We want to support you as much as we can, so we’ll always offer follow up calls to talk any questions through and advise on your next steps.

Our report may also raise additional queries for your solicitor, or may help them when setting out their enquiries for the seller, so it could be beneficial to instruct your surveyor when you’ve instructed your solicitor. Unlike other reports, Fourth Wall’s bespoke building survey reports include an Executive Summary that can be sent straight to your solicitor so they can see the key findings quickly and raise any necessary enquiries.

  • Discuss the findings of your survey and searches with your solicitor and make necessary enquiries to the seller

Your surveyor may suggest some further enquiries for your solicitor to make, such as boundary walls, historical party wall disputes and planning permission. Our bespoke building survey comes with an executive summary that can be sent straight to your solicitor so they can see issues, remedial works and necessary enquiries quickly and clearly.

  • Hire a removal company

It’s time to get packing! With your survey and searches done, start prepping for exchange and completion by contacting some removals companies. The property market is extremely busy so don’t leave this until the last minute!

  • Pay your deposit, exchange contracts and arrange completion

Once you’ve exchanged, you’re legally bound to the purchase so make sure you’re happy with the enquiries and your understanding of the property before you say yes at this point. This is also a good time to look at buildings insurance as you’ll now have responsibility for the property.

  • Complete on your property, pay your solicitor and stamp duty if necessary, and collect your keys

When you exchange contracts all parties will agree a completion day. This is the most exciting part as you count down the days to the move into your brand new home. The less exciting bit is seeing all that money leave your account, but it’s all worth it!

  • Give yourself time to settle in, and then instruct a surveyor or architect if you’re looking to make changes to your new home

You’ve moved in and started unpacking, but now your mind is racing with all the exciting updates you can make to your new home. Give yourself some time to settle in your home and understand what you’d like from the space, and then get in touch so we can help you design your dream home!

Categories
Our thoughts //

What will happen to stamp duty?

As the Government’s Budget on the 3rd March nears, it’s looking unlikely the stamp duty holiday will be extended for a significant period of time, but after a year of uncertainty for the UK, it’s difficult to predict what will happen in the next few months. Government had said they would not be extending the holiday, but are now considering an extension of 3 months until June, to allow those currently purchasing to complete on their sale. However, if they change their mind it wouldn’t be the first U-turn we’ve seen in recent months…

The implications of not extending the stamp duty holiday are concerning for a lot of people, not least those currently caught in the bottleneck of house sales who would be unlikely to complete before the end of March deadline, with an estimated 70,000 sales agreed in 2020 not expected to make it through before this date. If the holiday did end and these purchases hadn’t gone through in time, there may well be some sales falling through. It also seems a number of people are holding out on sales and purchases through the uncertainty, waiting to see what happens, and they will likely have an impact on the housing market later this year as they decide whether or not to move forward with their purchases.

House prices look to be starting to fall in some areas and, if predictions come true, when stamp duty ends they’ll likely fall more rapidly. This reduction in price is to be expected as the market stabilises following several months of artificial stimulus from the stamp duty holiday causing record highs in property prices across the country. We’ve said previously, however, that the boom in 2020 looks to have been heavily driven by second and multiple home owners and the higher end of the market, where property continues to be seen as a good long-term investment project and whose jobs are less likely to have been hit by lockdown restrictions and redundancies. 

The accessibility of mortgage products has caused some issues for buyers in the past year but, whilst lenders are likely to remain cautious, we would anticipate some loosening of lending criteria as the implications of furlough ending and the vaccine roll out become more apparent and some certainty returns to the housing market with the risk to lenders becoming increasingly more stable and transparent.

The potential of negative interest rates in the coming months may also stimulate the housing market, with traditional savings accounts of little value, banks are encouraging lending through mortgage products, and those with surplus capital seeing property as a solid investment.

Demand continues to outstrip supply due to a long term skills and material shortage in the construction industry, compounded further by Brexit and fluctuations in demand created by changing living patterns during the pandemic, so whilst we face more uncertainty ahead, investors, buyers and those working in the property industry can take some comfort in the historic performance of the housing market and there are indeed scenarios to feel cautiously optimistic about.

Stamp duty explained

Stamp duty rates with the holiday until 31st March 2021

Add 3% if this is not your sole property.

Up to £500,0000%
The next £425,000 (the portion from £500,001 to £925,000)5%
The next £575,000 (the portion from £925,001 to £1.5 million)10%
The remaining amount (the portion above £1.5 million)12%

Stamp duty rates from 1st April (potentially 1st July) 2021

Add 3% if this is not your sole property

If you’re a first time buyer, you pay no stamp duty up to £300,000.

Up to £125,0000%
The next £125,000 (the portion from £125,001 to £250,000)2%
The next £675,000 (the portion from £250,001 to £925,000)5%
The next £575,000 (the portion from £925,001 to £1.5 million)10%
The remaining amount (the portion above £1.5 million)12%

So, for example…

If you buy a house for £625,000 in March 2021 you will pay £6,250 in stamp duty, calculated as follows:

0% on the first £500,000 = £0

5% on the remaining £125,000 = £6,250

If you buy a house for £625,000 in April (potentially July) 2021 you will pay £21,250 in stamp duty, calculated as follows:

0% on the first £125,000 = £0

2% on the next £125,000 = £2,500

5% on the remaining £375,000 = £18,750

Categories
Our thoughts //

Predictions for 2021

What will happen to property in 2021 //

You’ve likely heard it a lot recently but the world of property is changing significantly at the moment. This is the case for both the residential and commercial markets so we’re going to highlight a few changes, and throw our hat into the ring when it comes to opinions.

What will happen to the UK housing market //

House prices ended 2020 at a record high, but this is predicted to slow with prices expected to drop when the stamp duty holiday ends at the end of March.

The residential market is still busy as buyers continue to look for new homes, however, Zoopla is predicting that half of January’s sales won’t complete in time for stamp duty relief, and some commentators have raised concerns that this could result in buyers pulling out of sales as the tax returning adds 2-15% on to the property price*.

The Royal Institution of Chartered Surveyors (RICS) found most members expect weaker sales in the year ahead, with some citing rising unemployment and the looming return of higher stamp duty and land tax levels across the UK. However, Zoopla also suggested a shortage of stock after 2020’s sales boom could limit price declines, saying:

“the scale of any downside for prices and turnover in 2021 is lower than in previous downturns”

The boom in 2020 looks to have been heavily driven by second and multiple home owners and the higher end of the market, where property remains seen as a good long-term investment project and whose jobs have been less hit by lockdown restrictions and redundancies. This suggests that the market may not have as a heavy a fall as some predict, although will still likely be impacted by the return of stamp duty.

Another area that may help the housing market to continue on a positive trajectory is changes in working habits causing an increased demand, something Zoopla believes still “has further to run” as changes to working patterns continue through 2021 and beyond. There has been a big increase in searches for property with greater access to outdoor space as people move away from city centre working, with many people requiring greater flexibility with the space they have as they continue with home based working. The impact of the pandemic on working practices is very likely to be felt for years to come, and thus we will continue to require more from our homes as they increasingly become a hybrid of work and leisure time.

When we talk of the future, it would be difficult to shy away from the climate emergency and the environmental choices we need to make. We have written more extensively on environmental building practices here, but this is likely to be an area to watch as we look to reduce our impact on the environment through more energy efficient homes and construction.

*This is dependent on value of property and whether it is one residential property or a second, or multiple, home.

What will happen to UK commercial property //

The future of commercial property is incredibly interesting, to us at least. There is undoubtedly going to be change in the way businesses operate moving forward as they look to adapt post pandemic, although some of this change was arguably already in the making and just exacerbated by the pandemic.

Retail, for example, has been heavily impacted for years by the growth of online sales, but with us all forced to stay home multiple times over the past year, the world of online shopping became even more lucrative. What will happen to these buildings? Where anchor tenants like Topshop and Debenhams once stood, who will take over? We think it’s important here to consider what is lacking in a certain town or city and how these spaces can be repurposed. Sheffield, for example, has long had a lack of both housing and Grade A office space, whilst other areas may well see growth of bars and restaurants as people long to get back to socialising.

Offices will of course change, we’re all working from home where we can and for many people this has been beneficial in giving them more time as they avoid a potentially lengthy commute. Moving forward, there will very likely still be a use for offices as we look at a more hybrid working pattern with a mix of home and office use. Although demand for office space may drop, prior to the recession demand outweighed supply so this could bring about a more level field. Changes in working patterns are also forcing current owners, landlords and businesses to look at the quality of the office they’re providing. Several buildings in Manchester, for example, are being retrofitted with showers, bike storage and recreational areas, offers now seen as essential by many employees. Offices in towns and cities will likely be in demand again as we leave the pandemic behind, even though home working will continue to be popular, a flexible solution of home and office working will likely be the new normal.

We also think they’ll be a greater move towards experiences, with businesses offering consumers more than just one activity such as shopping. Manchester’s Arndale Centre, for example, had already started to repurpose units, creating a prosecco bar to drink while you shop, whilst Junkyard Golf in Manchester saw huge success with an activity and a night out rolled into one. Some spaces, particularly shopping centres, will likely be entering an extensive period of redevelopment as they look to bring consumers back into their units, finding news way to entice them.

So what will be the focus of property post-coronavirus //

We believe the future of property lies in residential, offices and experience driven services, so we’ll see town centres with greater hospitality, more city centre living and thus urban green spaces, and offices that offer something new to their staff. There’ll be a lot of repurposing of existing spaces, and we think quite a few commercial to residential developments as centres change and become more attractive places to live again.

When looking at what has happened after other recessions, it’s difficult to compare. The 2008 crash was a different experience to nwo because it was created from banks having no money, and the exacerbation of the housing crisis caused everything to stop. This situation is different. The recession we do see may well be reflected in isolated industries as opposed to the whole economy going down. Banks do have money and there will likely be a short sharp recession and a huge bounce back. Demand for businesses that closed, such as pubs, restaurants and hairdressers, will return because the loss of demand was due to the manufactured situation of lockdown, and the consumer demand is actually still there.

The pandemic will be a catalyst for change for how businesses do things, with many likely coming back with a different model. There are also opportunities for other sectors to grow. The property industry for example, will be implementing change, doing due diligence, advising on changes of use, and creating and building new spaces.

Change is scary for some, but as the vast industrial heartlands of the north have been forced to find rejuvenation and a new purpose, so will many of our current retail spaces. Change isn’t always a bad thing. If it weren’t for deindustrialisation, I’d probably be covered head to toe in soot down a mine or at the Furniss, instead of writing this blog comfortably at home in my shirt with a coffee. ‘Proper work’ my old Grandad would say, maybe he was right, a real tragedy I’ll never know, I’m sure. In short, looking to the future there is definitely a period of change, but repurposing what is there and creating new things can be a positive as we move forward and say goodbye to covid.

This information and data in this article was correct at the time of publishing. However, it may now be out of date or superseded. Fourth Wall make no representation or warranty of any kind regarding the content of this article and accept no responsibility or liability for any decisions made by the reader based on the information/ data shown here.