Hydro Magic Update

A few months ago we told you about a unusual (no, unique!) opportunity we have first hand experience of here at Streetwise. Now it’s time for an update.

We practice what we preach here, and there’s no better demonstration of that than Ryan Foster. If you’ve called our administration department or customer helpline, you may have spoken to Ryan. He also works on the Streetwise Bulletin you’re reading today. Ryan has started a number of part time ventures (the education you get here is considerably better than the wages!) but has had by far his biggest success over the past 12 months with an idea he discovered in the United States.

Hydrographics is a water-based process for applying a design to three dimensional shapes. It can be used to add a design to just about anything – wheels,  car interior parts, engine parts, guns, fishing tackle, household items, phone cases – the list is almost endless. Ryan and his friend Chris Couldwell, saw the demand for this in the United States and decided to look into doing the same thing over here

After three months of researching the market and forming links with suppliers, and a further couple of months refining the production process, the business went live, first from a garage and then from a small rented unit, before moving to larger premises in January. All of this was done on an absolute shoestring budget – a process made necessary by the notoriously low Streetwise wages!

The business has taken off in a big way. Ryan and Chris are already doing work for architects, car dealers, bespoke motor cycle builders, fishing tackle shops and gun shops, as well as the general public. They even have a couple of major motor manufacturers (who I can’t name at the moment) considering using their work on special edition £30,000+ vehicles.

It shows what can be achieved in your spare time while holding down a full time job. Ryan had absolutely no help of any kind from us at Streetwise in getting this off the ground. In fact we didn’t even know about it until the business was well under way.

If you’d like to find out a bit more about this, go to www.streetwisenews.com/hydromagic where you’ll find examples of the work, a video showing the process in action and details of how you can get involved in the business yourself for next to nothing.

Euro – But…

So, the euro is on top! However, the common currency looks unlikely to continue to climb this week. This is because official data this Thursday looks set to show that the UK avoided a triple-dip recession. This may lift the pound against the euro as well as the greenback as it signals the UK economy is picking up.

Also, the Eurozone recession is expected to have deepened, according to fresh data due this week. This may bring the euro down as concerns about the currency bloc’s economy mount up.

Plus, the European Central Bank may soon cut interest rates below 0.75 per cent to support Eurozone growth. This could weaken the euro too because lower interest rates make the currency less profitable. Therefore, look for the pound and US dollar to rebound against the euro soon.

Rural Owners – Take Note

Knight Frank are warning rural property owners that they could lose manorial rights if they are not registered by 12 October 2013. Michael McCullough, Head of Mapping and GIS at Knight Frank, says, ‘Manorial rights often include valuable mineral and sporting rights so they are definitely worth protecting.’

‘Those most at risk are where land has been sold, often many years ago, with vacant possession, but the manorial rights retained. As of 12 October this autumn any overriding interest in these rights will be lost if they have not been registered.’ Time to take legal advice?

BTL Basics

Remember the ‘dodgy letting agents’ story we ran the other day? The Association of Residential Letting Agents, ARLA is offering some advice for tenants, as follows. It’s worth a read by landlords.

Lettings is an unregulated industry: The rental industry is not subject to any central Government legislation, meaning that anyone can set up as a letting agent or landlord. For peace of mind, do your research and seek advice from a letting agent affiliated to a professional organisation like ARLA. All ARLA agents must adhere to a strict code of conduct, as well as offering client money protection and redress schemes, which help protect consumers if things go wrong.

Your deposit should be secure: Typical deposits required can range from anywhere between four to six weeks’ rent.  This deposit should be paid by your landlord or agent into one of three government-approved tenancy deposit schemes. It is a legal requirement that the landlord or lettings agent protects the deposit in this way.  Tenants can find out more at: www.direct.gov.uk.

A professional inventory can help protect you: A detailed inventory compiled at the start of the tenancy assists in assessing any costs that may be deducted from your deposit at the end of your contract. Be present when the inventory is being done; if that’s not possible, insist on seeing a copy to ensure you agree with what has been noted. If there are photographs make sure they are good quality and reflect accurately any items captured. All documents should be signed and agreed by both landlord and tenant.

There are different kinds of tenancy agreement: Many shared tenancies contain a joint liability clause and this means you are responsible for the actions of your co-tenants for the duration of the tenancy. This includes covering their share of the rent if they were to unexpectedly move out. Before you enter such an agreement consider how well you know your sharers. And if you are asked for a guarantor when sharing, then make sure that they understand that they are guaranteeing all your responsibilities contained in the tenancy agreement.

Meeting safety standards: Landlords have a legal obligation to ensure gas safety is checked annually.  Make sure you have seen the gas safety certificate and instructions for all electrical items.  Also check to see if all soft furnishings comply with the Furniture and Furnishings (Fire) Safety Regulations 1988 and are fire safety compliant. Look for the fire safety label on all furnishings.

Energy performance certificates: Energy Performance Certificates should be given to you by your landlord or agent before you move into a new property. This will show you how energy efficient a property is.

Carrying out repairs: Advise your landlord or managing agent when things need fixing to avoid bigger problems in the future. Landlords are responsible for most repairs to the exterior or structure of a property including problems with the roof, chimney, walls, guttering and drains, as well as electrical, heating, hot water and sanitary installations.  For minor repairs and maintenance the tenant is usually responsible, but any changes – like re-decorating – should be pre-approved by your landlord.

Pay bills: Other than paying the rent on time, tenants need to ensure they are paying bills which are not included in the tenancy agreement.  In most cases these include bills for council tax, utilities, TV licence, Internet and telephone charges.  Tenants must also remember to check their tenancy agreement as some landlords will forbid any change to utilities supplier.

As ever, good advice – do pay a visit to ARLA at www.arla.co.uk. Lots of useful material and further advice there.

Blanket Licensing – Get Ready

You may remember that Newham Council in London became the first local authority to introduce mandatory licensing for all private landlords from 1 January of this year. We’ve long been saying that anyone buying a buy-to-let property needs to check their local authority’s stance before investing; there are huge variations across the country. What we think is common ground is that, eventually, all BTL landlords will have to be licensed.

The Mayor of Newham, Sir Robin Wales, indicates why. Appearing before a Commons select committee, he said that an earlier, voluntary system had a take-up rate of just five per cent. ‘All the evidence – and we have tried it extensively – is voluntary accreditation simply doesn’t work.’ Since the new, mandatory system was set up, there has been a take-up rate of about 75 per cent; the council has now begun taking enforcement action against non-compliant landlords. Note: this is the way the market is heading.

Pushchair Profits

According to insurer LV, thieves have found a new target – high end pushchairs. Apparently 913 buggies were stolen last year, up from 738 in 2009. Why? Because buggies are getting increasingly expensive, with an average one now costing £427 and top of the range models at over £1,000. Over the last 3 years, and despite the recession, expenditure on pushchairs has risen by 20%.

There are a couple of things to take from this, I think.  The first is a money making opportunity. Pushchairs are something that parents only need for a relatively short time, and the high price has to open up an opportunity for entrepreneurs to buy from one set of parents and sell to the next at a profit.

The second point is a more general one. In most markets, there is an opportunity to uplift the standard and specification of what’s being offered. That’s already happened in the pushchair market, but what about the market or markets you know about. Might an upgraded product be what the market is waiting for? If it is, as the pushchair proves, you can sometimes buck an economic trend.

Property Alert

UK Market Overview

Hometrack’s latest market survey suggests the UK property market is showing one or two shoots of recovery. Property prices are up by 0.3 per cent in March, the highest since March 2010. London saw 0.7 per cent growth whilst other ‘winners’ include the South East (0.2 per cent) and East Anglia (0.2 per cent). Even so, in a further reminder that the average can mask a range of performances, we should note that prices rose across (only) 23.9 per cent of the UK. As ever, dig deep!   

London continues to drive the average upwards but, even there, there are signs of a slightly shifting market. As Hometrack states, ‘Compared to a year ago, market conditions have changed. Lower mortgage rates as a result of the government’s Funding for Lending Scheme (FLS) have supported increased activity and demand. The weakening pound and concerns over Cyprus and the Eurozone will only serve to further boost the flow of international funds into the capital.’

‘High stamp duty costs are likely to result in would-be buyers looking to more affordable outer areas of London where properties represent better value for money. This is already being seen in the capital where price growth was strongest in North London compared to central areas where prices posted a below average gain of 0.5 per cent.’

Tenancy Agreement Advice

The Association of Residential Letting Agents (ARLA) has been offering advice on tenancy agreements. ‘Tenancy agreements are a fact of life for tenants and landlords, but all too often they are not fully understood, if properly read at all. Before signing anything both tenant and landlord should always ensure they understand the agreement and negotiate any changes with the landlord or agent before finalising the document. Before you take on a tenancy…

Always negotiate on paper. A tenancy agreement can be altered before it is signed, if both the tenant and landlord agree to the proposed changes. Make sure any agreement to carry out specific repairs or provide additional furniture is put into writing to ensure no disputes arise. A final copy of the signed tenancy agreement should be held by both parties, and this is particularly important if any changes have been made to the original, which may be a template document.

If in doubt, seek professional help. It is worth remembering that, in England and Wales, it isn’t a legal requirement for tenants to have a written tenancy agreement. Despite this, you should always ask for one to be provided by the letting agent or landlord. If there are any terms in the agreement you aren’t familiar with, seek legal advice to clarify any concerns you might have. Any agreement is required by law to be written in plain English, but it always pays to be completely sure you fully understand what you are signing.

Protect your cash. It is a legal requirement for tenancy deposits to be protected by an approved deposit scheme, and this should be explicitly referenced in the tenancy agreement. For further protection, you should also agree on who has responsibility for conducting an inventory of the property with your landlord or agent. This should then be written into the final countersigned agreement. For peace of mind when using an agent always check that they are affiliated to a professional organisation like ARLA. All ARLA agents must adhere to a strict code of conduct, as well as offering client money protection and redress schemes, which protect you if things go wrong.

The Tenant’s Viewpoint! When you rent from a private landlord, or through their agent, you have a legal right to use the property in a reasonable fashion without being disturbed by either party. If the landlord or letting agent would like to access the property, they should give at least 24 hours notice to comply with this requirement. It should be noted, however, that a tenant has a legal obligation to provide access for repairs, assuming sufficient notice is given by the landlord.

Until strife do us part! If you are sharing a rental property with others you may see a clause in the tenancy agreement referring to joint and several liability. In effect this means that if one or more tenants stop paying rent for any reason or cause any damage, for example, the remaining sharers will be liable for the associated costs. If this clause is present in a contract, always be sure to assess how well you know your prospective housemates. In some cases a guarantor form will have to be signed by a parent or guardian, which gives the landlord additional protection if a tenant should fail to pay the rent. If this is the case, the joint and several liability will be passed on to them.

Who pays the bills?  The tenancy agreement should clearly outline what utility and household bills you will be responsible for, and if there is any uncertainty, be sure to clarify this with the landlord. To get an idea of how much energy bills will cost, always ask to see a property’s Energy Performance Certificate (EPC) before you sign up. The closer to ‘A’, the more likely it is to hold in heat and register lower utility bills. The tenancy agreement should outline which party is responsible for maintaining the property. This could be the landlord themselves, or a managing agent. In either case, make sure you have contact details before the keys are handed over.

ARLA concludes, Ignorance of the terms outlined in a tenancy agreement is no defence against losing a deposit or being saddled with an unexpected bill. You can save a good deal of time and money by familiarising yourself with the terms. Renting should ultimately be a positive experience and a basic level of understanding, combined with good communication with landlords and letting agents should ensure this is the case.’

Property Selling Tips

MoneySupermarket.com – a good place to compare products – offers some property selling tips.

Identify your target market. The type of property you want to sell will determine the type of people likely to be interested in buying it. If you are selling a city centre studio, for example, your target market will probably be young professionals, either living alone or as a couple. But if you have a four-bedroom, detached house in a suburban area, families looking for a larger living space are much more likely to come knocking at your door. It is therefore important to prepare yourself and your property for the sort of buyers it will attract. This could include finding out information about local transport links or replacing a patio with grass suitable for playing on.

Pick the right price. Nobody wants to sell a property for less than it is worth. However, even with confidence in the housing market picking up, it is vital to be realistic. Otherwise, you may find yourself still waiting for an offer six months or a year down the line. The best way to avoid over or under-pricing your home is to do your own research into the asking prices – and sale prices – of similar properties in the local area before asking at least three estate agents for valuations.

Remember that first impressions count. Most buyers will decide whether they are interested in your property within seconds of first seeing it from the outside. And some will cross your home off their list after just driving past it if the impression they get is not good. Painting a scruffy front door, mending a broken fence or tidying up your driveway could therefore make all the difference. After all, you don’t want potential buyers losing interest before they have even stepped inside.

Spruce up your décor. There is usually little point spending a lot of money doing your property up to sell. In fact, most property experts advise spending no more than 2 per cent of your asking price on improvements designed to attract buyers. That said, there is no doubt that painting stained walls, mending dripping taps and giving the whole place a deep clean can make a big difference. If you have a garden or balcony, a few new plants and some smart-looking garden furniture could also prove a wise investment.

De-clutter your home. As much as you might love your collection of teddy bears or china dogs, the people coming to look at your house may not feel the same way. What’s more, while filling up your property with your little treasures makes it feel homely to you, it will make it harder for potential buyers to see themselves living there. Less clutter will also make any home seem bigger, making a clear-out before viewings a no-brainer.

Letting Agent Lowdown

According to The Property Ombudsman, 15,782 complaint enquiries were made to him in 2012; up 12 per cent on 2011. News from The Property Ombudsman suggests that, if you use an unregulated letting agent and something goes wrong it’s your tough luck (so far as the Ombudsman is concerned anyway).

The largest payout of £13,335 to a complaining buy-to-let landlord was because their agent placed an illegal tenant in their property and then did little or nothing for months whilst the rent went unpaid. The agent was said to have been reckless. If this had been an unregulated agent, no compensation would have been paid.

It’s important to note that letting agents do not have to be licensed or have to belong to a regulatory body. Even when your agent is regulated, there can still be issues – as the £13,335 case suggests! Time for an update to our ‘How To Pick A Letting Agent’? I’d say so – we’ll include it in the April issue out later next week.

BTL Mortgage News

TBMC, the buy-to-let and commercial mortgage specialist, has a new exclusive buy-to-let mortgage from Mortgage Trust. The initial rate is 4.75 per cent fixed to 30 June 2015. It comes with a free valuation and no completion fee. The early repayment charge is 5 per cent until – note – 30 June 2016. There is a £150 booking fee.

Andy Young at TBMC says, ‘We are delighted to launch this new buy-to-let exclusive from Mortgage Trust with no completion fee, because even though the buy-to-let mortgage market is becoming more competitive, many of the products on offer carry high percentage fees.’ As ever, talk to a broker and crunch the numbers to see whether a low rate-high fee deal is better or worse than a high rate- low or no fee deal is for you.

Smoke Alarm Reminder

It’s sunny (but cold) and spring is in sight – and it’s time to forget about smoke alarms until the winter? No, definitely not, says Wiltshire Fire & Rescue Service. ‘We know that working smoke alarms save lives yet too many people don’t take the time to test them regularly. The move to summer time always feels like a fresh start and so it’s an ideal opportunity to make sure your home is safer by installing new smoke alarms or cleaning and checking any you already have.’

‘Smoke alarms are inexpensive and can be bought in DIY stores and at many supermarkets. They should be fitted on every level of your home in accordance with the manufacturer’s instructions provided. Ten-year alarms are recommended for longer term protection.’ Time to check?