PROPERTY ARTICLE: How to make the best use of an ultra-small space. Copyright SvD.

 

How to make the best use of an ultra-small space.

Savvy landlords always invest in either studios or one bedroom apartments in those areas popular with city workers and professionals. There is always demand for smaller flats in the most popular areas in London. Even the smallest studio can generate a return. Here are some ideas for maximising space in the tiniest of flats!

1.         Make every square inch work. The bed can take up one corner but why not hoist the bed onto a deck and make use of the space underneath? You could place a desk and chair underneath for a study area or use that space for storage. Alternately, install a bunk bed so that friends or family will have a bed too when they visit! Better yet, consider a retractable bed that disappears during the day.

2.         Storage. In the kitchen area, ensure there is storage for pots and pans, glasses and cutlery. Overhead cupboards should be reachable by short people too. If there is only room for one cupboard in the flat, ensure that inside the space is divided for hanging coats and drawers for socks, underwear, pullovers etc plus a shoe rack as well.

3.         Bathroom- if space is limited in the kitchen area, you may have to consider sacrificing the bathtub for a shower cubicle instead and using the saved space to install the washing machine/dryer combination. Install a bigger sink which can double up for washing laundry by hand if need be.

4.         Think minimalist- every single item in the studio should have a practical value and should double up if required. In other words, shelving contains hidden storage. Dining chairs can be folded away or are comfortable enough to be used as sitting room chairs as well. Do not overcrowd the walls or shelves with too many paintings or trinkets- these crowd the small space and make it seem even smaller. 

5.         Define areas.  Create pathways from one defined area to the next. In other words, the living area should appear separate to the sleeping area or dining area. This method of separating and defining opens up the space and makes it functional. For example, place a two-seater sofa with a small tables on either side in the ‘living’ area. This will take up less space than two separate armchairs, for example. Similarly, the dining ‘area’ can be a small table and two chairs but with a cleared pathway between the living and eating space.

6.         Colour. Paler shades of paint make a space seem bigger and brighter than it actually is. Do not use darker matte shades which can be overwhelming and claustrophobic in tiny rooms. Do not even think about black, red or purple (believe me, I’ve seen it all). The same applies for bathroom and kitchen areas- choose appliances and fittings in white every time, and which has the added benefit of being cheaper as well.

PROPERTY ARTICLE: Government to scrap second home council tax discount. Copyright SvD.

 

Government to scrap second home council tax discount

The government has announced plans to scrap the second home council tax discount- what will be the implications for homeowners and landlords?

A client once showed me around his property portfolio in Central London which consisted of at least ten flats and a couple of houses in prime Central London. As I recall, the properties were all sumptuously furnished, spacious, in perfect condition and their value was stratospheric. Yet still my client never used them and the properties lay empty year-in and year-out. When I suggested that he could possibly rent them out and obtain a return on the money he had spent buying them, I was met with an incredulous look. Hence the reason it is said that if you drive through certain parts of London in the evening, you can tell which flats are owned by absentee owners- because the lights never come on!

Previously the government had allowed second home ownership to benefit from a few perks- notably a reduced council tax bill. All that is about to change and soon the council tax will be increased to its normal rate. The government is hoping that the increased taxation will force owners to rent out their properties and put them back in the market where a shortage of homes in certain areas is chronic. The other outcome that the government is hoping for would be to drive down prices and make the homes more affordable especially to locals who are priced out of the market. The move may encourage owners to offer their homes for letting instead of keeping them purely for the odd holiday for their families. The main objective for the government is to increase revenue to fill their coffers and whilst some may applaud the move I do think that hard-working families who have saved to afford a second home should not be penalised either.

With regards to empty properties such as those owned by my client in London as I mentioned before, the current rules are that if the property is empty and unfurnished there is no council tax to be paid for up to 6 months. If the property is furnished, the discount is 10%. In the days that I managed properties on behalf of landlords, I found councils to be quite fair on this issue and were willing to take the agent’s word or to offer rebates and credits. It is worth noting that council tax will be frozen for the next two years in a bid to help hard-pressed families. However owners should note that increases in the cost of policing, or budgets for parish councils, for example, and which are separate to the basic council tax tend to go up on an annual basis so there is always an increased council tax to pay regardless. Owners should take these incremental increases into account that is if they plan to keep their properties empty. Although given that the lettings market is busier than ever, homeowners should do well to become landlords and get their properties to work for them!

PROPERTY ARTICLE: How to get a better rent on your London property. Copyright SvD.

 

How to get a better rent on your London property

As a relocation agent I am frequently in and out of rental properties all over London. Some landlords keep their rental properties in excellent condition and have got it right in terms of décor and maximum usage of space. Other landlords get very low marks indeed and seem to think that even though their property is run-down and in need to repair, they should still be able to command a high rent. Not so!

Here’s a simple example of the type of thing I come across regularly and which puts off my clients (the tenants) completely. I recently showed a three bedroomed property to a client in Battersea. It was ideal in terms of the internal layout, the quality of the furnishings and best of all, its proximity to the children’s school. There was one drawback: the front door and pergola to the front of the house were badly in need of repair. The wood had rotted away in parts causing the pergola to lean perilously to one side and the paint on the front door was peeling off. Both the pergola and door had last experienced some tender loving care many moons ago. One of the terms of my client’s offer was for cosmetic repairs to be carried out to make the pergola safe and for both to be repainted. The landlord refused outright.  Needless to say, my client chose another property instead.

There are a couple of issues worth raising based on this story. Firstly, the letting agent should have informed the landlord that the property needed to be in reasonable condition in order for a good rent to be achieved. The pergola and front door should have been fixed long ago as par for the course.

Secondly, ongoing maintenance is cheaper. Once a tenant moves out a rental property should be freshly painted and cleaned professionally in readiness for the new occupier. Not all properties need to be painted in between tenancies especially if the tenancy has been very short (common sense here) but any scruff marks should either be removed through cleaning or painted over. The benefit to the landlord is obvious: he will expect the property back in the same condition as he handed it over to the tenant.

The same applies to kitchen and bathrooms. Tired bathrooms and kitchens can be a real turn-off to prospective tenants. Ready-made kitchen units are widely available on the high street and tend to be reasonably priced. Installing a fully fitted kitchen including all appliances can be as little as £1,000. (if you buy free standing units). And installing a new toilet, sink, bathtub or shower can be less than £2,000. Here’s a useful tip to landlords: when installing kitchens or bathrooms, do ensure that the ventilation is efficient. Inadequate ventilation can cause long-term damage through condensation build up and can be promote the growth of toxic mould. So remember: Tenants will be willing to pay more and will probably stay longer in properties that are maintained and presented in good order making it a win-win situation for both landlord and tenant!

PROPERTY ARTICLE: London property and the Euro. Copyright SvD.

 

London property and the euro

I’ve just read a very interesting article about global companies offloading their euros and converting them to the USD. It seems to me that the exit of Greece from the euro is pretty imminent and we could all wake up tomorrow and have to find drachmas for our next holiday in Crete. But what are the implications for the London property market which continues to defy the odds?

Given that the vast majority of buyers of London are from overseas, it would be logical to assume that London property continues to be regarded as a safe haven. London defies the odds year-in –year-out with prices creeping up steadily in spite of the financial crisis of 2008 and the ongoing recession. There is talk of European buyers flooding the market and capital flight- whereby bank deposits are emptied in countries in crisis and the money is spirited overseas- is rampant –ask any estate agent in Central London and the Square Mile.

To make matters simple, picture this- should Greece ditch the euro and go back to the drachma, the value of the drachma could be less than half of the euro. So effectively anyone with savings would see their savings dramatically reduced. A word about capital flight though- it weakens the economy even further because liquidity in the system is stymied.

I’ve also heard that luxury properties in the South of France for example, are remaining unsold- the rich foreign elite aren’t even spending on their dream homes, a sure sign that even they are biding their time to see what happens. I recently spoke to an Arab client about their investment plans. He asked me to look anywhere but Europe!

My own personal view is that London will continue to buck the worldwide trend but as the great spiritual masters remind us, nothing lasts forever. The repercussions of the eurozone crisis will be felt far and wide and stem from an economic quagmire that will not be resolved by any amount of rescue lending or enforced austerity. Eventually London will feel the effects of a failed currency and mass unemployment from across the Channel. The financial markets will become even more volatile and the net result is tighter controls on lending and less investment- both with a negative impact on growth.

There is also the question of the strength of sterling against the euro and USD. Eventually too sterling will be readjusted as the biggest trading partner the UK has is with Europe. Sterling is currently being propped up by quantitative easing and low interest rates that the Central Bank is hoping will make British exports more attractive (and which in turn will kick start growth). In a worst-case scenario, sterling will get weaker and the ripple effect will result in stagnant growth in the property sector. So in the medium to long term the prospects for continued growth in London property values will largely depend on what is happening in Europe.

London agents remain very optimistic about the prospects of continued appreciation of Central London property. Interest from overseas buyers has not waned and remains strong right up to the top end of the property market. And as long as that is the case, London will remain a startling phenomenon of hope over experience.

PROPERTY ARTICLE: The Safest Borough in London. Copyright SvD.

 

Which is the safest borough in London?

A client who has very young kids recently asked me which London borough is the safest place to raise a family. I have to admit that I did not know the answer straight away. Like most people, I consider London to be a relatively danger-free city and as long as one follows basic common sense, it is a very safe place to live and work. However my client’s question got me feeling somewhat curious and so I went off in search of a response.

According to the Metropolitan Police, crime overall in the capital has stabilised. The annual figures confirm that for the last three years, the total number of crimes committed in the capital averaged 82,000. per year. The figure for 2011 was marginally down on the previous year and the trend thus far for 2012 looks set to remain the same. Although the trend is encouraging, these figures are still too high and a drastic reduction would be welcomed by London residents, visitors and tourists alike.

The most prolific crime in the capital is violence against a person which accounts for around 20% of all crime committed in the capital every year. The most dangerous borough for this type of crime is Ealing with Westminster, Croydon, Newham, Brent, Lambeth, Southwark, Lewisham, Hackney and Tower Hamlets all following in near numbers. The safest borough for encountering violence against a person is Kingston Upon Thames followed very closely by Richmond Upon Thames, Bexley and Kensington & Chelsea.

The second most prevalent crime in the capital is theft from a motor vehicle. The most likely place to have your car broken into is Wandsworth followed by Newham, Waltham Forest and Kensington & Chelsea. The safest place to park your car without fear of a break-in appears to be Kingston Upon Thames followed closely by Richmond Upon Thames and Sutton.

The third most prevalent crime is residential burglary. Densely populated and prosperous boroughs like Kensington & Chelsea (where the highest incidence was recorded), Islington, Camden, Westminster, Greenwich, Wandsworth and Hammersmith & Fulham are popular targets for thieves.

The lowest incidence of residential burglary is in Sutton, followed by Kingston Upon Thames and Richmond Upon Thames.

I should have noted that the highest type of crime across the capital is antisocial behaviour but I have deliberately omitted those figures from this article simply because the crime itself encompasses everything from begging in the street to harassment to racial slurs to substance abuse et al. The Crime and Disorder Act of 1998 was amended to the Anti-Social Behaviour Act of 2003 and the revised act includes a very long list indeed of offences considered antisocial. Most of my clients and professionals moving to London tend to rate burglary and violence as the barometers for defining a safe society. No doubt antisocial behaviour is a rising and worrying trend in London and one wonders how it will ever be eradicated completely, as we all know people are usually their own worst enemies.

PROPERTY ARTICLE: The Shard of Glass. Copyright SvD.

 

THE SHARD OF GLASS

I practically live in London Bridge Station – just joking but I am there very often on my way to meet clients in the City. I have watched the Shard take shape and now that it is ready (and open on the 05^th July) I am as intrigued as most people will be to see just who will be moving in to London’s tallest building.

The Shard of Glass, as it will be known, is Western Europe’s tallest building standing at 1,030 ft (310 metres). Once completed, there will be 72 floors of which floors 53-65 will comprise 62,129 sq ft (5,772 m²) of luxury residential apartments. The apartments have not officially gone on sale but there are rumours of price tags of around £30- £50m per apartment.

Apart from residences, the Shard will contain office space (floors 2-28), restaurants (floors 31-33), a five star hotel (floors 34-52) and above the residences, an observatory stretching from floors 68-72 (the top floor).

Given that the finance which funded the building is a form of sharia compliant investment, it is unlikely that the tenants permitted will have any connections with alcohol or gambling. No figures have been revealed yet with regards to the rent for the office and commercial areas but it will be on par with if not more than the City and Canary Wharf which average around £40-£50 per sq ft.

The Shard is likely to become a major tourist attraction as it is estimated that the public viewing gallery in the Observatory will draw two million visitors per year.

The buzz is that the apartments will easily sell as the London property market remains extremely buoyant and defies the downward property price trend in the rest of the country. It is clear that all if not most buyers of the Shard apartments will be foreign as London property continues to be seen as a safe haven. A surge of buyers from France (now that Sarkozy has lost the election) is expected to descend on the capital in the near future.

The apartments will be at a height equivalent to the ‘cloud ceiling’ in the capital which is around 700ft. So in other words residents will be able to look out and see the clouds below them as they would if they were in an airplane. London’s notoriously cloudy and wet weather will limit exceptional views of residents hoping to see the sea some 44 miles away, to perhaps a few days of the year only.

A second building, albeit, much shorter will be built nearby. This building will be known as London Bridge Place and together with the Shard, they will form the London Bridge Quarter. The Southwark area where the Shard has been built is in need of regeneration. As a regular commuter in and out of London Bridge Station I am hoping that the station itself and the immediate vicinity will be greatly improved and refurbished when the Shard opens for business; currently the station is a disgrace for such a prosperous area. Apart from the very popular Borough market, the area is in need of a shot in the arm to compete with more coveted areas such as Knightsbridge and Kensington. If all of the Shard apartments sell at the asking price, it will provide a strong impetus to developers that the area will indeed become prime residential investment in the London property sector.

PROPERTY ARTICLE: The School Dilemma. Copyright SvD.

 

The School Dilemma

One the tasks I frequently have as a relocation agent is to help clients find schools for their kids. I, myself, took the whole school search aspect of my job as pretty straightforward- how wrong was I!  Never in my wildest dreams did I have any idea of how difficult it can be to match a rental property with a state school for children to attend. Many clients come to me tearing their hair out at what they consider the injustice of it all. And here’s why….

When a client comes over to live in London, they typically have an idea of where they would like to live. Usually they have friends or friends of friends who recommend a certain area over another. The client will ask me to first explore their accommodation options in that particular area. I then have to remind them that if they plan to send their kids to state funded schools – i.e free to attend and not paying schools- there are certain requirements that are cast in stone.

Firstly, the parents need an address. In other words, they need to prove that they do indeed qualify for their children to attend a state school as they need to live within the catchment area for that school. Proof consists of utility bills. The parents usually cannot do this as they are moving into the area and will have no tenure to show. The school will therefore reject them outright.

Secondly, the waiting list for performing and high-end state schools is several miles long. So even if the parents  manage to scrape together the required proof of address, they will probably end up at the bottom of the waiting list- behind those with a longer tenure in the area.

Thirdly, siblings are given preference. If a sibling is already attending the school, their sibling will move up the waiting list. So the parents who have just moved into the area slide further down the waiting list.

Fourthly, it is pretty pointless moving into an area in the hope that the child(ren) will automatically qualify to attend the preferred school. The nightmare chicken-and-egg scenario is a costly mistake to make- there are zero guarantees that once the family moves into the home in their preferred location that the children will qualify to  attend a nearby state school.

Fifthly, parents should be aware that places only become available towards or at the end of each term when families move out of the area and kids change schools.  But by that time, the family hoping for a place will have had to abandon their quest altogether as again, there are no guarantees and waiting lists typically get longer, not drastically shorter.

The best time to stand any chance of securing a place is to keep in constant contact with the registrar at the schools- an exhausting and time-consuming task.

Failing that, I typically advise families to give up on their preferred location and I find them an alternative area where with any luck, they will be just as happy and their children will settle into a great school.