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Guild Blog: New Rules for Portfolio Landlords Now in Place

Are you a Portfolio Landlord?

 

Portfolio landlords – those with four or more mortgaged buy-to-let properties – now face more stringent checks by lenders when buying additional properties.

Since the end of September, new portfolio lending rules issued by city watchdog the Prudential Regulation Authority mean that lenders must look at a landlord’s entire property portfolio when deciding whether to offer them a buy-to-let mortgage on a property.

The rules have been introduced to provide lenders with greater certainty that landlords will definitely be able to afford any additional borrowing they take on.

 

Different lenders, different approaches

Many lenders have confirmed that they will continue to provide buy-to-let mortgages to portfolio landlords, although they will require much more information about their existing properties before they will accept a new application.

Other lenders, however, put off by the longer underwriting process and an increase in paperwork, have taken the decision to move away from lending to portfolio landlords following the rule changes.

Some have said that although they are not prepared to accept new applications for additional buy-to-let lending from portfolio landlords, they will still consider remortgages, but only if they are on a like-for-like basis.

 

What portfolio landlords can do to prepare

  • Landlords with multiple properties who are planning to add to their portfolios can help speed the mortgage application process along by making sure they have all the information lenders will require ready in advance.
  • Lenders will want to understand any existing mortgages already in place, as well as the amount of rental income each property in the portfolio brings in, along with any expenses, such as maintenance costs. They are also likely to look at your assets, liabilities and cash flow.  This is so they carry out an assessment of affordability right across the portfolio, to be certain that you won’t be over-exposing yourself financially by increasing your borrowing.
  • There are other rules which have recently come into effect which also affect landlords. For example, lenders now need to impose a ‘stress test’ for the first five years of the loan when you apply for a mortgage, so that they can check you’d still be able to afford monthly payments if rates go up.  However, they may adopt a more flexible approach if you are applying for a five-year fixed rate buy-to-let mortgage as if rates do increase during this period, your monthly payments won’t be affected.

 

The Guild has partnered with L&C Mortgages, the UK’s largest fee-free mortgage broker. You will be able to get expert advice at the end of a phone when it suits you. Their expert advisers are on hand 7 days a week and will manage a full search of the mortgage market so you don’t have to.  Over 1 million people have come to L&C for fee-free expert mortgage advice, so you know you can trust them to help you too.  Call L&C today on 0800 923 1945 or click here to find out more

 

 

Guild Blog: Government Launches Consultation into House Buying and Selling

This blog features our very own Sales Manager, Stefan Collier!

If you would like any further advise then please pop in to see our knowledgeable Sales Department who will be able to offer you advise on all aspects of sales.

 

 

We asked our Guild agents what their thoughts and opinions were on the recent government inquiry: “Government launches consultation into house buying and selling”.

 

Zoe Hayle, Marshalls & Parsons
“The Government consultation needs to address the whole buying process. It is most unfair that someone can agree to buy a property and can withdraw, on nothing more than a whim, right up to the day of exchange.

“The Home Information Pack was introduced to make home selling and buying quicker, however well-intended the concept, the practical application needs adjusting. A survey on a property must be acceptable to all lenders, or it is a waste of time and money for the buyer to provide it. Searches in advance of agreeing a sale would be ideal. However, they would be more effective for it to last for longer than the three months agreed on at present.”

 

Nicole Cox, Wye Residential
“The biggest bug-bear for us is the length of time that sales take to go through. Interestingly it is not often the mortgage that is the stumbling block, but the conveyancing itself. Investing in a well-qualified and skilled conveyancers and solicitors should not be underrated. Trusting in the knowledge and experience for the legal teams involved will enable sales to go through quicker, smoother and more efficiently. In doing so, the process will become less expensive for all parties and vastly reduce the stress that is often involved with buying and selling property.

“Gazumping is a nuisance, but does tend to show that the market is buoyant. However, with effective conveyancers and solicitors involved, I believe that this would no longer be an issue as both the buyers and sellers experience a smooth and successful sale.”

 

Alan Howick, Howick & Brooker Partnership
“If every house had a MOT it would make it easier. My view is:

1. Return the Home Improvement Pack

2. Create a checklist for sellers to complete for putting their home on the market including: gas, electric and asbestos checks

3. Encouraging lawyers to work alongside estate agents will help all parties involved get to a smooth and transparent sale

4. Create a checklist for buyers: the buyer should have a proven completed chain and proof of funds in place to prevent sales falling through”

Stefan Collier, Joplings 
“As a selling agent and a surveyor, I regularly see the wasted time, money and emotion from all parties. This is largely down to the fact that the initial decision to purchase is based on very little information and because there is no time limit. The process is all the wrong way round; conveyancing, getting a mortgage and searches take such a long time (10-12 weeks from agreeing a sale until exchange, when 10 years ago the average was 6-8weeks), often causing buyers and sellers to get cold feet.

“To counteract this, the vendor should have a survey, valuation and legal pack before going to market to establish the legal title, searches and any problems with the property. This allows issues to come to light and be fixed before going to market. When the purchaser makes an offer based on all the relevant information, I believe that there should be a financial commitment to purchase and a set timescale to exchange. 

“This will therefore be a way of ensuring that the vendor is committed to selling, as there would be an upfront cost. Additionally, only committed sellers will put their houses on the market, reducing the numbers of pull outs. Purchasers too are less likely to withdraw because they will be more knowledgeable about the property from the offset. The legal pack would speed up the time it takes solicitors to complete the conveyancing process. The financial commitment from the purchaser would further guarantee their commitment to purchase before offering. 

“The above system could save everyone concerned a lot of money. Except maybe solicitors!”

 

Justin Flanagan , Charles Eden
“The Department of Business, Energy & Industrial Strategy’s report on ‘Research on Buying and Selling Homes’ states that, 13 per cent of buyers and one per cent of sellers have experienced Gazumping leading to sales falling through. However, in my experience of gazumping is limited to none.

“If anything, gazundering is more of an issue and whilst this generally does not lead to a fall through, it does cause a lot of stress at a late stage. All transactions are subject to contract so it would be difficult to prevent this behaviour from the buyer. It is also difficult to police as they can always find some sort of reason to justify their action.

“The south of England is arguably experiencing a slowing market. This provides the perfect backdrop to highlight any pitfalls of the Home Information Pack. We found that when sellers collated information and paid for searches on the outset, this information was generally disregarded by potential buyers coming along months down the line for understandably it was seen as out of date. Likewise lenders would take this view.

“Whilst not providing a solution I thought it worth highlighting issues for consideration when discussing matters.”

 

Allan Carr, Pulver Carr
“I believe all fees and charges, especially set by the Government should be more transparent. The Stamp Duty Charges within the M25 are a suitable example of this. If the charge was made clearer or even reduced, it could have the positive effect of encouraging people to move or buy property.

“It is currently very easy for either party, buyer or seller to withdraw from the sale. It may be more efficient to create a ‘lock in’ for both parties. They would pay a non-refundable deposit to be held by their respective solicitors, so that in the event that one party pulls out, the other party will be disappointed and inconvenienced, but they would at least not be out of pocket.

“Finally, solicitors should have the ability and the desire to speed up the conveyancing process which often causes undue delays, especially with leasehold properties.”

 

Simon Davies, Norman F Brown
My three points of interest are:

“In my mind the Home Information Pack had the best of intentions, but didn’t carry enough weight within the industry and were too complicated. As an alternative, agents have the expertise and can work more closely with the solicitors. Agents could collect the protocol documents solicitors usually sort out when a sale has been agreed including, fixtures and fittings and property information questionnaire. We can then send this all off with the memo of sale to the solicitors.

“It is too easy for purchasers and sellers to pull out of a deal. It can genuinely change lives and cause a great deal of heart ache. To combat this, to speed things up I believe that once the survey has been conducted, whoever pulls out should be liable to pay for the fees of the other party (Including part of our fees). This will be hard to police and sometimes it is justified, but it will ensure that only serious buyers and sellers engage with the process.

“Better communication and efficiency between solicitors, conveyancers, buyers, sellers and agents will lead to quicker transactions and fewer withdrawals. I suggest that solicitors invest in interactive websites for buyers, sellers and agents to be kept updated.”

Joseph Down, Debbie Fortune Estates
“My two key points on this are as follows:

“The cost of moving is a huge factor that has caused many to think twice about moving at all, preferring in many cases to extend their existing homes if possible. Stamp duty is still such a significant cost for many, particularly here in the South West, where prices are very strong around the Bristol area meaning many now “average” moves are costing £20K – £30K in stamp duty, agency fees, solicitor fees etc. In my opinion I would encourage the government to look at stamp duty again, for both single property owners and investment. I do appreciate that the changes made over the past few years to stamp duty have brought the cost down for many, and made the system fairer. It is still however a very large cost to factor in, often ending a sellers’ hopes of moving.

“The lack of commitment until exchange is, in my opinion, the biggest problem in the industry. Our current system offers no compensation or security when a sale falls through. To address this, I suggest that the agreement should be more legally binding at offer stage, with some form of redress should either party pull out of the deal. Many other countries around the world offer us an insight into how we can evolve and make our system more efficient and simple – Scotland being one of them.”

 

Philip Jackson, Maguire Jackson
“One of the lead issues is to address the falling numbers of transactions. Today the level of property sales is over 30% down on the same time ten years ago (HMRC Stats England 2016 had 1,057,750 sales, whereas 2006 1,404,710 sales).

“One explanation for this is that increased Stamp Duty makes impulsive moves more considered as do the increasing costs for private lands, which supply a large part of the private rented sector. The HMRC would maintain its revenue if the Stamp Duty levels were reduced because it would be countered by the increased volume from the market.”

 

Chris Sawyer, Sawyer & Co
“Firstly, making the process legally binding earlier will be worthwhile for all parties by increasing trust and confidence both in the process and people involved. I suggest that we give parties the option for a delayed completion or an on or before completion date. There would be financial consequences for buyers and sellers who fail to conclude.

“Secondly, in order to speed up the process we need to get vendors legally ready for a sale. Technology could help with this by collating information online such as, land registry title information, details contained within a local authority search, management information (in the case of leasehold properties) and perhaps even a survey or building report. Together with any other relevant documents about the property, either on a government website or digital platform, this could be used by the buyer, conveyancer and lender.

“This information could also be seen by buyers before any commitment to purchase is made, and in the case of leasehold transactions, managing agents should also be made to provide information within a swift time frame and at a realistic cost.”

 

Simon Miller, Partner at Holroyd Miller
“I probably won’t be popular for saying this but bring back the Home Information Packs. A Home Information Pack is telling the buyer, the solicitor and the lender everything they need to know right at the beginning of the process, which in theory should speed up the process to exchanging contracts.

“Currently the system is too easy for people to walk away. I can appreciate a property may flag up issues later in the buying process which could force a decision to walk away, but the Home Buyers Pack would ensure that didn’t happen. A non-returnable deposit would certainly make people think through their decision with more commitment.

“There is a requirement for a universal survey that the lenders are prepared to accept. Many issues are caused by the valuation survey and often it can come as a nasty surprise. A universal survey conducted independently would solve the problem and provide buyers with clear guidance on how much their bank is prepared to mortgage.

 

Lynda Lewis, Town & Country Mold
“In short, the law should be changed to state that an accepted offer is binding and all vendors should have survey done on their own home enabling a better understanding by the buyer of the financial commitment over and above the cost of the property purchase. The original proposition around the Home Information Pack made sense. It proposed a Property Survey, but sadly a watered down version was introduced. This would go a long way to ensuring serious home Buyers/Sellers only come to market and increase the likelihood of avoiding fall throughs and quickening of the whole process.”

 

Life Magazine – Le Tour de Yorkshire in Ripon by Nicholas Lancaster

Joplings’ chosen theme for Issue 4 of our magazine was 2017 Tour de Yorkshire, to celebrate the fact that the City of Ripon was a hub for the race with family events throughout the city and a ‘Big Screen’ on the market place.

Nicholas Lancaster sent in this amazing photograph of the cyclists as they raced through Ripon and was chosen as the winning image due to the exhausting effort showing on the faces of the riders as they powered up North Street.

Guild Magazine – The Lock Keeper’s Cottage by Paul Hildreth

Joplings asked the people of Ripon for a Spring photograph which could be used on their next Guild magazine front cover.

 

Paul Hildreth from York was one of many people who emailed and kindly provided a selection of Ripon images. We used his seasonal Spring photo of Ripon Canal and its well-known Lock Keeper’s Cottage for the cover of Issue 3 of our magazine.

JOPLINGS’ LANDMARK: Guild status for Joplings Property Consultants

PRESS RELEASE: 5th December 2016

 

Leading property consultancy Joplings is proud to announce that it has been awarded exclusive Membership of the prestigious Guild of Professional Estate Agents for Ripon and Thirsk.

 

The Guild is a nationwide network of approaching 800 leading estate agents, all dedicated to maintaining the very highest standards of professionalism and customer service. Guild Membership is traditionally only granted to one agent in a given area.

This appointment means that Joplings has been judged to have met or exceeded The Guild’s exacting Membership criteria, and in recognition of this achievement has been selected as its sole representative in Ripon and Thirsk.

As part of Guild Membership, Joplings has access to innovative marketing to promote their sellers’ properties to the highest standard. They also have access to the widest possible pool of buyers – not just in Ripon and Thirsk but across the whole of the UK including the lucrative London market, where properties are marketed through The Guild’s head office in Park Lane.

“Being chosen to represent The Guild in Ripon and Thirsk is a great honour,” says Michael Stephenson, General Manager. “The awarding of this membership is a tribute to all the hard work we have invested into building our reputation for exceptional service, and underlines our position as a leading property consultancy in the area.”

Speaking on behalf of The Guild, CEO Marcus Whewell says: “We are delighted to welcome Joplings into The Guild as our new representatives in Ripon and Thirsk. Their expertise and outstanding service mean that they will be an important and valued asset to our national network.”

With all these advantages, Joplings is keen to develop the services it offers its clients. “Our business is all about people,” says Michael Stephenson, “which is why we remain committed to the principles of good old-fashioned, honest, personal service and this has always been our trademark.”

Expert market knowledge and the traditional customer service you expect from a leading local property consultancy, combined with unrivalled nationwide marketing power, means that Joplings and The Guild make a powerful and successful combination.

JOPLINGS’ LANDMARK: MRICS Chartered Surveyor qualification for Stefan Collier

Joplings are delighted to congratulate Stefan Collier following his qualification as a member of the Royal Institution of Chartered Surveyors.

 

Stefan recently passed the APC (Assessment of Professional Competence), after an intense programme of learning and experience based competencies.

Where will I find Stefan Collier to arrange a Survey?  You will find him working in our Ripon office carrying out building surveys and valuations on residential properties across North Yorkshire. Joplings provide a range of RICS surveys to suit the age and type of property being purchased.

How does Stefan feel about achieving his RICS?   “I’m really pleased to become a MRICS surveyor, which is recognised as a leading professional qualification in property. With two chartered surveyors now operating out of Thirsk and Ripon, Joplings has further strengthened its position as the leading property consultant in the area, giving our clients confidence that they can expect a truly professional service, whether it is in sales and lettings or surveying, valuation and Architectural design.”

Joplings’ General Manager Michael Stephenson added, “ We are delighted for Stefan, that he has achieved RICS membership.  He has worked extremely long hours and sacrificed a lot, particularly in the months leading to the Autumn assessment. Some weeks Stefan was in the office 7 days a week, showing his dedication to becoming qualified.”

 

Joplings

Joplings have offices based in Ripon, Thirsk Market Place and Thirsk Farmers Auction Mart and Rural Business Centre, where they provide a range of services in sales, lettings, architectural, surveys and valuation of residential and commercial property. They are the only Chartered surveyors based in Ripon and Thirsk, providing local expertise invaluable to clients.  Michael Stephenson stated, “We are well placed to report on the condition of the property you are purchasing and advise upon development potential and produce designs through our in house architectural team. Our clients are increasingly interested in the valuation of their purchase prior to commencing building work and after, wanting to ensure they don’t spend too much on the property in case they need to sell up unexpectedly and lose money.”

 

Joplings – The Ripon and Thirsk Offices

 

If you are purchasing a property and wish to have a survey carried out or want to discuss an extension or alteration to your property contact Joplings on Ripon 01765 694800 or Thirsk 01845 521317 or 01845 522680 or email surveying@joplings.com architecture@joplings.com

Please call in to discuss your requirements - our friendly staff are always happy to help

10 North Street, Ripon North Yorkshire, HG4 1JY Telephone: 01765 694800 Fax: 01765 694801 ripon@joplings.com
19 Market Place, Thirsk North Yorkshire YO7 1HD Telephone: 01845 522680 Fax: 01845 526055 thirsk@joplings.com