Home Truths

Wyn Derbyshire originally trained as a research chemist, gaining a PhD from the University of Cambridge before qualifying as a lawyer. He has for many years been interested in financial history. He is writing a series of biographies of tycoons for Spiramus Press. Bryan Pickup is a partner at the law firm SJ Berwin and the former Head of the Property Department.

INTRODUCTION 1
CHAPTER 1 THE PROPERTY SYSTEM IN ENGLAND AND WALES 5
The big picture 5
The legal framework 5
Some history 6
The Crown Estate 9
Freehold and leasehold 10
Why leasehold rather than freehold? 11
Typical lease terms 14
Leasehold issues 16
Other forms of ownership 24
Land Registration 26
Freehold title issues 31
CHAPTER 2 BEING A TENANT 35
The big picture 35
The legal background 36
Assured Shorthold Tenancies 37
Finding a tenancy 37
The terms 41
Legal responsibilities 42
How to reduce risk 49
Signing on the dotted line 50
The form of tenancy agreement 50
The landlord’s obligations 51
Standard clauses 52
Future contact 52
Tenancy extensions 52
What if there are problems? 52
What to do at the end of the tenancy? 53
CHAPTER 3 BUYING A PROPERTY 55
Buy or rent? 55
Research 58
House price reports 58
The Bank of Mum and Dad 60
What do I want? 62
Finding ‘The One’ 64
Making an offer 74
Buying from new 77
Buying at auction 78
Valuations and surveys 80
The chain 85
Choosing and using a legal adviser 87
The legals 95
Up to exchange of contracts 95
After exchange of contracts 99
Completion day 101
After completion 102
Post transaction review 103
Joint tenants and tenants in common 103
Special schemes for first time buyers 106
‘Home Buy’ 108
Right to buy 112
‘Squatters’ rights’ 114
CHAPTER 4 SELLING A PROPERTY 119
The right approach 119
Choosing your timing 119
Stage 1 - Marketing 119
Choosing an agent and setting a price 120
Agency terms 123
Selling at auction 125
Presenting the property 125
Viewings 127
Choosing and instructing a solicitor 130
Instructing your solicitor 131
Stage 2 — Deciding 133
Offers and how to assess them 133
Decision time! 134
Exchanges of property 136
Exclusivity or lock out agreement? 136
Stage 3 – Getting to exchange 137
Managing the process 137
The legals 139
The chain 141
Stage 4 – Getting to completion 142
Stage 5 - The Great Moving Day 143
CHAPTER 5 MORTGAGES, TAXES AND PENSIONS 145
Mortgages – origins and growth 145
The basic mortgage 146
Mortgages and interest rates 147
Payback time 150
Tax 160
Stamp duty 160
Income tax 163
Capital gains 165
Income from commercial property 168
Property and pensions 168
CHAPTER 6 LOOKING AHEAD 173
Introduction 173
Death, debt, defects, dementia, disputes, divorce 173
Death 173
Debt 179
Defects 191
Dementia 198
Disputes 211
Divorce 224
CHAPTER 7 BUY-TO-LET 229
The big picture 229
Why ‘buy-to-let’? 230
Ups and downs 231
2010 onwards 232
The golden rules 233
Where? 234
What property? 234
Buy at the right price for renting 237
Budgeting 239
Finding a tenant 241
Finding an agent 241
What kind of letting? 242
Tenancy agreements 242
The terms of the letting 243
Letting a property — legal requirements 246
Assured tenancies 247
Holiday lettings 247
Letting to students 249
What is an HMO? 251
Managing your ‘buy-to-let’ 252
Managing the tenancy 252
Managing the property 256
CHAPTER 8 INVESTING IN COMMERCIAL PROPERTY 259
The big picture 259
Ups and downs 260
Investment options 260
Health warnings 261
Market risk 262
Property risk 262
Rental risk 263
Product risk 263
Tax risk 264
Characteristics of the UK commercial property market 265
Leases 265
Methods of commercial property investment 266
Direct investment 266
Shares 266
Collective investments 267
REITs - why do they matter? 272
Thumbnail sketches 276

CHAPTER 9 PROPERTY DEVELOPMENT 279
The big picture 279
Guidelines 280
What does ‘buy well’ mean? 280
Adding maximum value 281
Controlling costs 282
Selling well — marketing, presentation and setting 283
Regulatory controls on development 283
Permitted development 285
Class A — extensions and improvements 286
Class B — roof extensions 287
Class C — roof alterations 287
Class D — porches 287
Class E — outbuildings, enclosures, swimming pools and oil and gas containers 288
Class F — hard surfaces 288
Class G — chimneys, flues and soil and vent pipes 288
Class H — microwave antenna 289
Solar panels 289
Making a planning application 289
Penalties for breaching planning controls 291
Requirement for Building Regulations consent 292
What the building control service is for 292
What the building control service is not 293
The Building Regulations 293
Amendments to the BR 2000 294
Applying for Building Regulation approval 295
Local authority building control service 295
Full plans application procedure 295
Building notice procedure 296
Approved inspectors 297
Regularisation certificates 297
Enforcement 298
Enforcement notices 298
Injunctions 298
Prosecution (section 35 and 35A, Building Act 1984) 300
Time limits 300
The future of Building Regulations 301
Green issues and property development 302
The big picture 302
Incentives for Energy Production 305
CHAPTER 10 BUYING ABROAD 307
Deciding what you want 310
Finding what you want 313
Buying it 314
Budget 315
Plan 315
Process 315
Buying from a developer v buying second hand 319
The role of the notary 321
The pain in Spain 323
Raising the money 327
Tax 328
France - sale and leaseback 330
Timeshare and fractional ownership 331
Co-ownership and running costs 333
Spain 335
France 338
Portugal 341
Italy 343
Switzerland 345
(Southern) Cyprus 347
Florida 349
Dubai 351
South Africa 353
AFTERWORD 355

APPENDIX 1: Property in Scotland and Northern Ireland 357
Property in Scotland 357
Buying and selling 357
Renting 358
Property in Northern Ireland 359
APPENDIX 2: Useful websites 361
Finding a tenancy 361
Property search websites 361
First time buyer websites 361
Nationwide firms of agents 361
National and London newspapers websites 362
Auction sale sites 362
‘Nosy neighbour’ websites 362
Affordable Housing 362
UK Holiday letting 363
Letting property abroad 363
Overseas property search 363
UK solicitors specialising in overseas purchases 363
Guidance on green issues 364
Index