Please click any of the questions below to reveal the answer.
You're right. There has been a great deal of talk recently in the press and broadcast media about the credit crunch - most of it highly technical in nature. Basically, what is happening is this:
In essence, the term "credit crunch" describes the growing unwillingness of banks and other financial institutions like building societies to lend money quite as freely as they had previously been doing. The reason for this is that they simply can't afford it.
How can this be? Well, the days when banks only lent their own (or rather, their depositors') money are long gone. These days, they supplement their lending by raising vast additional sums in the international market. In other words, they borrow from other banks.
Now, this all works very well as long as everyone's got plenty of cash, but it quickly begins to unravel as soon as banks start going broke - which is where the spectacular collapse of the so-called sub-prime market in the USA comes in. So closely intertwined and interdependent are the modern international capital markets that banks all over the world have some degree of direct or indirect exposure to the sub-prime meltdown - witness Northern Rock. The trouble is, no-one really knows who is most badly affected - and so banks are playing safe by refusing to lend to each other, in case they don't get their money back.
But what does all this mean to you, and your moving plans? Surprisingly little, as it happens. Conditions in the housing market aren't actually as bad as the media would have us believe. There is an enormous amount of regional variation, of course, but broadly speaking there are still mortgages available, and sales are still happening. Yes, you may need to be more realistic about the asking price of your own property. But remember, this softening in prices is happening right across the board - so if you are looking to trade up to a larger property, then it actually works in your favour, since you will save more on your purchase than you "lose" on your sale!
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In a written submission a couple of weeks ago, Housing Minister Caroline Flint announced the extension of the temporary provisions on first-day marketing and leasehold documentation - which have applied since HIPs first came into force last year - from June 1st to December 31st.
What does this actually mean? Well, first of all, one of the biggest bones of contention over the introduction of HIPs was the issue of first day marketing - in other words, the right of homeowners to instruct an estate agent to commence marketing their home immediately, without any delay. The Government remains committed to removing this right, and instead insisting that no property can be put on the market until a HIP has actually been produced. However, such was the outcry against this from estate agents and others that the Government was forced to concede that - for a strictly limited period, while the new system was bedding itself in - properties could be put on the market as long as a HIP had been commissioned.
So, what has now happened is that the Government has recognised that its original deadline for removing this concession is far too optimistic. This effectively means that until the end of the year, your agent can still start marketing your home once a HIP has been ordered, and they have had confirmation that it is HIP-compliant - thereby enabling them, for example, to contact so-called "hot" buyers straight away on your behalf.
Will this "temporary" concession be extended yet again, come the end of the year? Who knows. But, with the Government's track record, I suspect that no-one will be taking bets against it happening.
As for the issue relating to leasehold documentation, this particular concession was originally wrung from the Government because of the difficulties and delays involved in collecting together all the required information. Again, whether or not these problems will have resolved themselves by December 31st remains to be seen.
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Aside from certain specific exceptions (for example, seasonal and holiday homes, properties that are scheduled for demolition, or those which have a sitting tenant), no-one can now put a residential property on the market without first commissioning a HIP - although the ultimate intention is that the HIP should actually be in place first.
What are HIPs intended to do? Well, by bringing together much of the necessary documentation right at the start of proceedings, instead of waiting for the buyer's solicitor to request it, the aim at the outset was to make the entire sales process quicker and more certain - on the entirely logical basis that the faster the transaction, the less opportunity there would be for anything to go wrong. While this remains part of their purpose, the Government's principal focus is now more on trying to encourage people to make their homes more energy efficient. Hence the inclusion in the HIP of an Energy Performance Certificate, or EPC, which not only rates a property from A-G on the basis of its energy efficiency, but also suggests ways in which that rating can be improved.
Aside from the EPC, a HIP must also contain the following: an index, a sales statement ((basically saying that the property is to be sold freehold, leasehold or commonhold by private treaty or tender), standard local authority searches, and evidence of title or ownership. In the case of leasehold properties, a number of other documents also need to be included, such as a copy of the lease.
What does a HIP cost? Well, at Helmores we offer the following options: Either you can pay up front for the HIP at a cost price, or we can include the cost of the HIP within our commission on a no sale - no fee basis, meaning you can put your property on the market without having to pay up front, and you won't have to pay for the HIP if you decide not to sell either.
If you are a buyer as well as a seller (as most of us are), you will actually save much of the cost of your HIP on your next purchase. And by the same token, if you're a first time buyer, then HIPs will actually save you money!
If you have any further queries regarding HIPs please don't hesitate to call us on 01363 777999.
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The notion that there is a one-size-fits-all approach to marketing property is a fallacy. The fact is, different market conditions demand different approaches. Right now, for example, a good estate agent may well suggest adopting the "offers in excess of" ("oieo") approach, since it is designed to help generate higher levels of interest - particularly useful in a buyers' market.
One of the key advantages of the oieo approach is that it tends to attract genuinely committed buyers - people who may already have found a buyer for their own property, for instance, and who are now looking at the market very seriously. In this, it differs somewhat from the "normal" method of selling by private treaty, which will often attract a proportion of interest from buyers who are not in such a favourable position. One spin-off benefit of attracting serious buyers, of course, is that it tends to generate offers relatively quickly - so you soon get a pretty accurate picture of how much your home is really worth in the current market.
Also, with oieo, you are providing buyers with a realistic base price, rather than an asking price. This might seem like a small difference, but the fact is, asking prices are normally assumed to be on the optimistic side, and therefore they tend to attract lower offers. The whole object of the oieo approach, on the other hand, is to do the exact opposite.
If there is a downside to oieo, it lies in the fact that you are effectively telling the market in advance what you are prepared to sell for in a "worst case" scenario. However, remember you are not actually obliged to accept any offer at all. Besides, if you pitch the base price correctly, there is every chance of attracting two or three competing buyers - in which case, you could find yourself the beneficiary of a bidding battle, even in today's market!
On balance, therefore, I would have to say that if you are really keen to sell - and it happens to be a buyers' market - then oieo is a very good way to go about it.
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The short answer - without seeing your home, of course - is almost certainly Stamp Duty. Despite repeated calls from right across the property industry for wholesale changes to the stamp duty regime, the Government in its recent Budget once again left it unchanged. And you can understand why, from their point of view. Stamp duty is a fantastic earner. Without having to lift a finger, the Government has seen its total take from this source soar by 40% to a staggering £6.4 billion in 2006/07, thanks to rising property prices.
There are two major problems with Stamp Duty. The first is the fact that the thresholds at which the varying rates of duty becomes payable simply have not kept pace with the rise in property prices. Currently, those rates are as follows:
· Up to £125,000 - 0%
· £125,001-£250,000 - 1%
· £250,001-£500,000 - 3%
· Over £500,000 - 4%
At a time when average national house prices, according to the Government's own figures, are over £222,000, there are now vast swathes of the country where you can't buy anything much bigger than a garden shed without incurring duty.
In your case, meanwhile, your home falls just the wrong side of the 3% threshold. Which brings me to the second problem with stamp duty. Incredibly, it is levied on the full purchase price - not just on the extra amount over and above the tipping-point between rates. In other words, anyone buying your home for, say, £255,000 will have to find a whopping £7,650 for stamp duty - compared to "just" £2,500 if they buy it for £250,000!
So what, you may say. After all, it's the buyer that pays stamp duty, not the seller. That is true, of course. But...the reality is that we are currently experiencing a buyers' market. That means buyers are spoilt for choice. If you are seriously considering selling - and if you need to do so within a particularly tight time frame - then it may well be that an offer of £250,000 is the best you can expect to get.
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That depends on what needs doing and of course how much time and money you've got. However, you're certainly right in thinking that the way your home is presented can make a real difference to its saleability - particularly in the current market. With quite a lot of property for sale, buyers are relatively spoilt for choice - so you need to make sure your home stands out from the crowd.
As a general rule, even in slower markets, it's not worth tackling anything too big and expensive to improve the appeal of your property - for the simple reason that you are unlikely to recoup the full cost when you sell. Small things, on the other hand, can make a big net difference - things like clean, fresh paintwork inside and out; clean carpets and windows; tidy, neatly-trimmed gardens, and so on.
One of the key points to remember when it comes to presenting your home to prospective buyers in the best possible light is that the whole property should be of a consistent standard. So, for example, if everything else is being let down by the one room that you never got around to decorating, then it's probably worth doing that room up now (as long as it doesn't then make the rest of the property look dowdy, of course).
Overall, I suggest you start by taking a step back and try to look at your home as objectively as possible, as though you were seeing it for the first time. Make a list of any little things you notice that need sorting out. But try to keep a sense of proportion. After all, this is your home, not a show-house. People expect it to look lived-in.
Meanwhile, if you are in any doubt, then the thing to do is ask us at Helmores. After all, we are in and out of properties all the time - so no-one is better qualified to advise you on what needs doing to bring out the best in your home.
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When it comes to making offers, there are few hard and fast rules - whatever the state of the market. Right now, for example, the press and broadcast media are busy telling everyone that we are in a buyers' market, and that hard-pressed sellers may therefore be amenable to accepting lower offers. However, it's worth bearing in mind that if a seller's agent has done his or her job properly in the first place, then the asking price should already be pretty much spot on. After all, no agent wants to waste time and money trying to sell a wildly overpriced home - particularly in the current climate.
That said, there's absolutely nothing wrong with making an offer, although it's advisable to do some research first, to see what similar properties in the area may recently have sold for. These days, there are a number of websites like www.myhouseprice.com and www.ourproperty.co.uk which can provide this kind of information. However, it's important to remember that they get their data from HM Land Registry, so it's basically 3 months out of date.
As a first-time buyer, you obviously won't suffer from the disadvantage of having to sell something else first, so there's less chance of losing out to someone who can move more quickly than you - other than a cash buyer, of course. Nevertheless, in making your offer, you should be prepared to be outbid. In this context, it's worth remembering that the agent is legally bound to continue passing on any new offers to his client (the seller) right up until exchange of contracts - unless specifically instructed otherwise. So, even if and when your offer is accepted, that's by no means the end of it.
One final word of advice. Resist the temptation to make offers on several different properties at the same time. Admittedly, this is a practice more commonly seen in a sellers' market, but still, it's not really cricket. You won't want someone doing it to you when you come to sell in the future!
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With all the doom and gloom in the press, you might be forgiven for thinking that the property market was on its uppers. It isn't. In fact, there are still good purchasers out there, mortgages are still available, and property is still selling.
However, the point about prices is that they are a function of supply and demand - and the fact is that currently, there is quite a lot of property on the market, with more coming on all the time. As a result, buyers are relatively spoilt for choice, and can enjoy the pick of the crop. So, if you are keen to sell quickly, then it's all the more important to ensure that your asking price accurately reflects what similar properties are actually selling for.
Of course, even in the current market, there is always the possibility that there is someone out there willing to pay over the odds for your home because it particularly suits their needs - for example, if it happens to be close to a relative of theirs. Finding these very special buyers can be time-consuming, but if you aren't in a tearing hurry to sell, then by all means give it a go. Remember, however, that it's a good idea to have a strategy in place to review the situation on a regular basis with your agent.
Any other advice? Well, in the current market - just like any other - I would urge you to put your home up for sale before you go looking for something else, for two reasons. Firstly, if your property is already sold, then as a buyer you will be in a very strong position. Secondly, if you find the home of your dreams before putting your present property on the market, then you might feel pressured into accepting a lower offer, simply in order to hang onto your proposed purchase.
Finally, of course, one of the best ways of ensuring you get the best possible price for your home, in any kind of market, is by keeping it in tip-top condition, inside and out.
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Most good estate agents these days will gladly handle viewings for you, at no extra cost. Indeed, I'd go so far as to suggest that if an agent doesn't offer accompanied viewings, as they are called, as a more or less standard part of their service, then you should look elsewhere.
Whether you're buying or selling, accompanied viewings offer a number of very real advantages - which is why they have long been considered the norm in other parts of the world. Indeed, in places like the USA, the idea of leaving the viewing of a property - in some ways the single most important stage in the entire marketing campaign - in the hands of a rank amateur (i.e. the owner) would be laughed out of court altogether. And when you think about it, that makes a lot of sense. Although the agent doesn't have your detailed knowledge of the property, he or she does have the skills, training and experience to identify and focus on those features that are particularly relevant to the wants and needs of the prospective buyer. In other words, they are better qualified to sell your home than you are!
As a vendor, accompanied viewings obviously relieve you of the chore of showing prospective purchasers round your home yourself. You can simply go out for an hour or so and come back when it's all over. If you've got dogs or young children, this is especially valuable, since it enables you to get them safely out of the house for the duration of the viewing - which is always a good idea!
Furthermore, if you are elderly, or living alone - or just understandably nervous about letting strangers into your home - accompanied viewings are the ideal solution.
Finally, it's worth remembering that buyers also tend to prefer accompanied viewings, since they are often too embarrassed to put questions about a property directly to its owner.
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Strictly speaking, this is really one for a solicitor. That said, my understanding is that technically, you own half the thickness of any party wall, so as far as minor, everyday things are concerned - like drilling into it to install fixings for kitchen cabinets or shelves, or even cutting into it to install electrical wiring and sockets - you are basically free to do what you like, as long as you don't do it in the middle of the night. Nevertheless, it is basic politeness to let your neighbours know before you start.
Major structural work, meanwhile, is a rather different kettle of fish. This is governed by the Party Wall Act, 1996, which gives you the right to do things like cutting into the wall to take one end of an RSJ, or slicing all the way through it in order to install a new damp course. If necessary, you can even demolish the whole thing and completely rebuild it! However, you must inform the owners of the adjoining property, in writing, not less than two months ahead of the planned start date.
As well as requiring you to give the proper notice, the Act also stipulates that any work done should not cause undue inconvenience for your neighbours. In addition, you are responsible for providing suitable protection for buildings and property during the course of the work, and for compensating your neighbours in the event of any incidental damage. In return, your neighbours are legally bound to allow free access to their property as necessary for the proper completion of the work.
While my understanding is that your neighbours cannot ultimately stop you from exercising your rights under this Act, failure to do things like providing proper notice - quite apart from being an appalling breach of common courtesy - could trigger a lengthy and potentially costly dispute. That's why I would strongly urge you to seek proper legal advice before doing anything too drastic.
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Variations on this question are put to agents all the time - whatever the state of the market. But if the question is essentially the same, so too is the answer. Basically, you should sell when you want to, or need to. I'm afraid there is little point trying to exploit the property market in the way you suggest - for the simple reason that it doesn't work like that.
Look at it this way. If it were really possible to choose a time to sell that would maximise your return, then everyone would be doing it. Then what? There would simply be a glut of property on the market, and prices would have to come down!
That said, it is true that the majority of sellers tend to wait until Easter before putting their homes on the market, because there tends to be an influx of fresh buyers looking to move in time for summer. However in practice, this means that there is often quite a shortage of property on the market at the start of the year! Yes, there may be fewer buyers out there looking in January. But there will be fewer properties for them to choose from too. Conversely, while there may well be more buyers on the lookout come Spring, there will probably be a lot more property on the market as well, all competing for their attention. That's how supply and demand works. And the current state of the market doesn't alter that one iota.
So, if you want or need to sell early in 2008, I would advise you to bite the bullet and put your home on the market in the New Year. If you need any more persuading, just think: the sooner you do so, the sooner your home will sell - which means you will be perfectly placed to get first pick of all those Easter properties!
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As far as traditional pets like dogs and cats are concerned, there are of course no restrictions. However, things are rather different in the case of other animals.
For horses, ponies and donkeys, the rules are not too onerous. Nevertheless, since 2002, each animal must have its own passport - and when one dies, you can't simply bury it somewhere on your land. Instead, it must be collected for proper disposal by an approved carrier.
As for chickens, geese or ducks, flocks of anything less than 50 birds are exempt from registration - although you are encouraged to do so voluntarily.
Things get a lot more complicated, however, with traditional farm animals - what would broadly be termed livestock. Whether you have a single cow, pig, goat or sheep and treat it as a pet, or whether you keep several and exploit them for their milk/wool/meat etc, the same rules apply. Basically, all livestock must be registered with Defra (the Department for Environment, Food and Rural Affairs). You must also apply for the relevant ear-tag or passport for each animal, keep detailed records of their health, etc, and obey all rules on animal movements.
How do you go about this? The first step is to contact the Rural Payments Agency (www.rpa.gov.uk), and apply for something called a County Parish Holding (CPH) number for the property where the animal or animals are to be kept. Once you have a CPH number, you can register each one with Defra via your local animal health divisional office. Strict rules apply to the movement of all such animals. With cows, for example, you must notify the British Cattle Movement Service, and keep records of all such movements for up to 10 years.
This might all seem rather excessive if you're just planning to keep a handful of animals around your property - but as the recent scares over foot and mouth, bird flu and so on have highlighted, when it comes to keeping animals, you can't be too careful.
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The first thing worth emphasising here is that you needn't have any worries over safety and security. As part and parcel of their duty of care to their clients, all agents who undertake to hold keys on behalf of clients are required to have clear procedures in place to eliminate any possible security risk. For example, all keys will normally be stored in a secure location - for example, an office safe. In addition, individual keys will normally only be identified by a reference number. The list of which number goes with which property will always be kept separately, either elsewhere in the office or in a different location altogether. So, even if by some chance your key were to fall into the wrong hands, it would be next to impossible to link it with your property. Finally, of course, all reputable agents are insured against any breach in these procedures.
As to whether leaving your key with your agent is actually a good idea, the short answer is, Yes! In fact, it has a number of real advantages. For example, it obviously allows your agent to conduct accompanied viewings on your behalf - which could be particularly useful if a really hot buyer turns up out of the blue, and you're not at home.
Then again, if you go away for any length of time, leaving a key with your agent means that he or she can pop round occasionally and keep an eye on the place. We're not talking about housework or garden maintenance here, but simply a question of giving the place a bit of an airing. And of course, if the worst were to happen, like a burst pipe or even a break-in, it means that your agent would be able to alert you in good time and make suitable arrangements for the necessary repairs.
Above all, leaving a key with your agent enables you to continue leading your normal life - despite the fact that your home is on the market. And anything that does that has got to be a good idea!
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This is really a matter for a solicitor. The law governing this sort of thing underwent some major revisions a few years ago. Up until then, all you needed to prove was that you had occupied the land for a period of 12 years without any challenge from the legal owners. After that, you could claim possessory rights over it (not quite as good as full title, but the next best thing - particularly if you took out suitable indemnity insurance).
Now, things are rather more complicated, and the simple 12-year threshold no longer applies. You can understand why. Squatters' rights - which is effectively what we are talking about here - were always something of an anomaly in modern-day society, and it was only a matter of time before some Government or other reined them in.
So, what is the current situation? Well, that depends. When you say you have been "looking after" the land, what exactly do you mean? If it is simply a piece of unfenced ground that you have kept a horse on, for example, then you have no rights over it at all. To claim any such rights, you must have fenced it in or formally delineated the boundaries of the plot in some other way - and preferably done something else to improve it as well, such as landscaped it.
However, the real crucial point is whether the legal owners of the land are aware of your occupying it, or not. If they are, and they have agreed to it - or even if they have simply condoned it - then they will be deemed to have exercised their right of ownership, and you yourself will therefore have no legal rights whatsoever.
On the other hand, if despite your very best efforts you have failed to locate the legal owners; if you have subsequently fenced the land in and landscaped it; and if in all that time no-one else has claimed ownership - then you may well have a case.
That's a lot of "ifs" - which is why, as I said at the beginning, you best bet is to consult a solicitor.
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Legal Indemnity Insurance is not something that most people will have come across. Unless, that is, they have been involved in a previous property transaction which has been delayed or even prevented from going through altogether, due to some legal complication.
This type of insurance doesn't actually resolve such matters. Instead, it neatly circumvents them by providing protection for the purchaser against the possibility of any future financial loss or 3rd-party claims.
One of the main areas where this comes into its own is over issues of title or ownership - particularly in cases where so-called possessory title is involved. This sometimes crops up with older properties which haven't changed hands for a long time. It means that although the current owners may have had use of a piece of land for many years, there is no official record of them having full legal title - otherwise known as absolute title. This is precisely the sort of glitch that would normally set all the legal alarm bells ringing. But with indemnity insurance in place to protect the purchaser against the costs of any future legal challenge, the sale can proceed in the normal way.
Other problems that indemnity insurance can help solve include those relating to lost documents, issues of access, poorly-worded legal documents, restrictive covenants, or even properties built on unmade roads. In this last case, for example, the purchaser's solicitor might well propose that indemnity cover be arranged against any future demands from the local authority for contributions to the cost of having the road made up, or to meet any future claim over rights of way.
Since it benefits both seller and buyer, legal indemnity cover may be arranged by either party. A single premium payment, normally of between £150 and £300, provides protection in perpetuity - so, once cover has been arranged, it is transferrable from owner to owner.
So, to use a DIY analogy, legal indemnity insurance doesn't just paper over the legal cracks. It's more like a high-quality filler, giving a permanent, smooth finish!
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As you're probably aware, Home Information Packs (better known as HIPs) have not been without their fair share of controversy. The Government has consistently claimed that they will work wonders for the housing market and save the planet to boot. Others - namely estate agents, solicitors, surveyors and mortgage companies - have tended to be rather less enthusiastic.
So, being as objective as possible - and working on the basis that nothing in life is either all good or all bad - what, if any, are the real benefits of HIPs to you as a buyer?
Well, if this is your first foray into the housing market, then you stand to save money on the cost of your purchase, since the searches and so forth that you would previously have had to pay for will now be available for nothing in the HIP, courtesy of the seller. (If, however, you are selling one property in order to buy another, then you naturally lose that benefit.)
Secondly, the Energy Performance Certificate which forms a central part of the HIP will give you a clear idea of the energy efficiency of the property you are contemplating buying, together with some advice on how that might be improved. How important the energy rating may be in influencing your purchasing decision - and how valuable the advice that comes with it - remain, shall we say, open to question.
Thirdly, the Land Registry Plan, which forms part of the evidence of title in the HIP, will give you an indication of the boundaries of the property.
As for the rest of the contents, this is basically all technical material which will be of use to your solicitor, but of little interest to you personally. Ironically, however, this - if anywhere - is where the real benefit of HIPs may come, in cutting the time it takes for the transaction to go through. The quicker sales happen, the less chance there is for anything to go wrong - and that would be good for everyone.
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Actually, of all the criticisms levelled at HIPs, this one is probably the least valid. In the vast majority of cases, moving home means selling one property in order to buy another. From the cost perspective, all that HIPs have done is to take certain items from the buying side of the equation - things like searches and so forth - and load them onto the selling side.
HIPs are therefore broadly cost-neutral. The only entirely new element is the Energy Performance Certificate, or EPC, and that probably costs less than £100. With average property prices now over £200,000, that's a mere drop in the ocean compared to the £2,500 that the Government will take off you in Stamp Duty!
Granted, if you are just selling, then your HIP is effectively a bit more expensive, since you aren't able to recoup the cost of things like searches on your next purchase. But even here, other than in exceptional circumstances, we are only talking about £200-£250 in total.
So, the answer to your question is: no, HIPs haven't made moving home a lot more expensive - so you certainly shouldn't let the thought of them put you off moving!
While I'm on the subject, it's important to clarify something about the EPC, which all HIPs must include (at the present time, of course, we're only talking about properties with 3 or more bedrooms). The EPC not only rates the energy efficiency of your property, but also suggests ways in which this rating can be improved. Now, some concern has been expressed that these suggestions are mandatory - in other words, that you are required by law to undertake the work. This is absolutely NOT the case. The Climate Change Thought Police might not like me saying this, but you are perfectly free to completely ignore everything that the EPC suggests! Hopefully, it will be many a long year before you can be thrown in the Tower for having single glazed windows.
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If you have the space to do it (not to mention the money), then extending is certainly an option. However, there are a number of important points you need to bear in mind.
Firstly, an extension is quite likely to require planning permission, and major work of this kind will in any case need to conform to current Building Regulations. This is expensive. Of course, you can always have things done on the cheap (and there are plenty of builders around who will be only too happy to oblige), but this will only store up problems for the future. For example, you won't be able to sell your property as having 3 bedrooms, when in terms of Building Regs it only actually has 2 proper bedrooms, plus a loft room.
Secondly, no matter how happy you may be in your current property, extending always involves an element of compromise - not to mention an enormous amount of dirt and disruption. Trying to carry on anything remotely resembling a normal life in the midst of a building site, perhaps for months on end, can be very stressful indeed.
Finally, if you do decide to sell in the near future, you may well not recoup the full cost of the work. Yes, a 3-bedroomed house is worth more than a 2-bedroom - but not necessarily by as much as you might think. Extensions may provide more accommodation, but often they do so at the expense of the look of the property. We've all seen nice, neat Victorian semis that have been completely ruined by the addition of huge, top-heavy dormers.
At the end of the day, if you'd rather stay put, then by all means go ahead and extend. But if you would really prefer to move house, then do it - and do it now. Remember that as a buyer as well as a seller, it's all a question of swings and roundabouts - whatever the state of the market!
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In practice, HIPs haven't fundamentally altered the conveyancing process at all. The two parties' respective solicitors still have to go through all the documentation with a fine tooth comb, to ensure that all the Is are dotted and all the Ts crossed. The big difference is in the way much of this documentation is delivered - and who pays for it. Local authority searches, for example, used to be commissioned by the buyer's solicitor on behalf of his or her client. Now, those searches are contained in the HIP, which is paid for by the seller.
Right from the start, of course, it was one of the principal aims of HIPs to speed up property transactions - thereby helping to reduce the number of sales that fall through. Despite all the controversy they have stirred up, it remains difficult to argue with the underlying logic: by bringing together most if not all of the legal documentation right at the start of proceedings - instead of waiting for the buyer's solicitor to set the ball rolling - significant time savings should be achievable.
Right now, it's far too early to determine whether HIPs have really delivered those savings. Major changes of this kind always have teething troubles, and take time to bed in. However, I suspect that the real key to the long-term success of HIPs will lie in the amount of information that is included in the packs. As things currently stand, for example, a HIP must include standard local authority searches, but specialist searches covering things like mining - pretty important if the property concerned is in a former coal-mining area - are only optional. Similarly, neither Home Use nor Home Contents forms are currently on the mandatory list, even though together they contain a great deal of important information that the buyer's solicitor will certainly require. The former, for example, deals with a whole range of topics, including boundaries, services and agreements with neighbours, while the latter details precisely which fixtures and fittings are included in (or excluded from) the sale.
My advice is therefore simple - the more information you include in your HIP, the faster your sale should be!
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That depends on what sort of property you are looking to sell. Here in the UK, auction tends to be reserved for those properties where the normal method of sale by private treaty is less likely to produce the best possible price - for example, land (with or without planning permission), properties requiring substantial renovation or remedial work, short leasehold properties, and houses suitable for conversion.
One of the great advantages of auction is that contracts are exchanged at the fall of the auctioneer's gavel, with completion normally following in 28 days. This means 1) that sales rarely fall through, and 2) they happen far more quickly. As a result, auction may be particularly suitable for sellers requiring an immediate sale. However, the seller will need to instruct the agent several weeks in advance of the actual auction date, to allow time for details to be included in the auction catalogue and for various other administrative processes to be completed - like, for example, the compiling of a Home Information Pack, if one is required.
Talking of HIPs, it's worth noting that properties sold at auction have always needed a legal pack, containing items such as proof of ownership, searches and so on. In other words, just about everything a HIP contains, except the new Energy Performance Certificate. Properties that don't require a HIP - for example, land, or 1 and 2-bedroomed properties, or those that have a sitting tenant - will continue to require such a pack.
The agent conducting the auction will of course explain everything else you need to know, and advise you on setting a guide price and a reserve. Why two prices? Well, the guide price is just that - a general, ball-park figure published in advance and designed to help stimulate interest from prospective buyers. By contrast, the reserve price is strictly confidential. This is basically the minimum price you will actually accept. Although you agree it in advance with your agent, it can be changed at any time.
Once everything is in place, you're free to attend the auction if you wish, and drink in the unique air of excitement and anticipation. Who knows, you might even get hooked, and start attending them regularly!
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