The gap between exchange and completion

There are many steps in the process of buying and selling - the final one being completion.  Most people understand that a sale becomes legally binding upon exchange of contracts and, at this stage, the completion date is written into the contract. On exchange a purchaser will pay a deposit of between 5-10%, and the remainder of the funds are paid on completion ie the day that you finally own your new home - lock, stock and barrel.

In the past, many sales had a gap of 4-6 weeks between exchange and completion but these days we often see this reduced to 2 weeks - sometimes (and for the brave only!) we even have simultaneous exchanges and completions.  But the gap is there to leave a welcome breathing space in which to organise the practicalities and detail.  Also, some mortgage lenders generally like a 7-day period within which to draw down funds.

And here is how to fill the gap:

Pack as soon as possible after exchange.  

Prior to exchange receive quotes from removals companies but don’t commit (ie pay the deposit) until your solicitor is confident of exchange.  This is especially difficult in busy periods such as Easter or Christmas -  and remember a lot can happen between ‘nearly’ and ‘actually’ exchanging.

If you’re packing and moving yourself on a DIY basis - give yourself plenty of time.  You can be sued under contract if you’re running well behind time on the day, thereby incurring your buyer additional removal costs.

Inform relevant utilities and services eg: gas, electric, water, phone, satellite, cable suppliers, TV licence, post office, bank, DVLA, your doctor and insurance companies etc.  Take meter readings on the day you leave.

The buyer will have been provided with the supply details on the Property Information Form filled in by the vendor - so the buyer knows who to contact to continue or change supplier.

The buyer MUST insure their new home from the day of exchange as you are now committed to buying it even if it burns down.

A few days prior to completion the estate agent will make arrangements in respect of the key handover. Generally this means we will collect a spare set from our seller and then meet the purchasers at the property with the key to the door.  It is important to note that we can only release keys once the seller’s solicitor has confirmed that the completion monies have been received.

Finally, emotions can run high prior to an exchange when the estate agent and solicitors are trying their best to dovetail an ideal completion date between seller and buyer.  This can get even more protracted when a lengthy chain is involved: holidays, school terms, bereavements, sheer practical and physical logistics can all create stumbling blocks. 

But, as with all things, don’t forget the bigger picture - compromise: it’s better to bend a little than break the sale.

Caroline Edwards
Partner
Residential Sales, Long Melford
T: 01787 888622
E: caroline.edwards@carterjonas.co.uk

Our lettings team shortlisted for Best Letting Agency Group in ESTAS Awards 2016

I have pleasure in announcing that our national lettings team has reached the final stages of the ESTAS Awards 2016, having been shortlisted for the Best Letting Agency Group. 

In the ESTAS regional categories, the Carter Jonas Barnes, Bath, Cambridge, Newbury, Wandsworth Common and Winchester offices have also been shortlisted. The ESTAS are one of the largest and longest running awards in the UK property industry and winners are decided purely on ratings provided by a firm’s clients. This year, the shortlist was announced based on the biggest-ever number of customer surveys. 

To be shortlisted for these awards is a real honour for our national lettings team and is testament to the hard work that we put in to ensure our clients receive the best possible service.  We’re extremely proud to be rated so highly by our clients and thank them for this. 

Since we began our lettings service to operate alongside our residential sales offering, it has been our aim from the outset to be included among the best national lettings agents, and so we are delighted to be recognised in this way. 

The winners of all categories will be announced at the annual ESTAS Ceremony held in April at the Grosvenor House Hotel in London. 

Lisa Simon, 

Partner Head of Residential Lettings

T: 020 7518 3234 

E: lisa.simon@carterjonas.co.uk

The Autumn Market makes a welcome return

For the past 4 years we have seen a new pattern emerging in the residential sales market.

Whereas, traditionally, we used to rely on the Spring and Autumn markets being our busy selling periods, more recently January and February have become crucial to our trade. As lifestyles, demands on time and the means of contact change, the desire for immediacy gets ever stronger.  Decisions are made over Christmas family gatherings and once this desire to move becomes the focus, the house needs to be found - or sold - now! And, without a sense of urgency, desire loses its value.

Rather unnervingly, the Autumn market has been poor over the past few years.  However the mood has changed this year: August was strong and September is proving even better. The Autumn market is back!

Various events were contributing to the recent yearly cycles of strong first half, weak second half – last year it was Mark Carney’s early indication of interest rates rising.  They didn’t!  But it affected people’s thinking, nonetheless.

This Autumn, despite a very erratic stock market which could have unnerved sales, activity is strong.  We saw an over-confidence in pricing following the General Election in the Spring, but many guide prices of the time have been trimmed back and a sense of reality has returned.  We’re also comforted by a steady Government and continuing low interest rates. Lower Stamp Duty (SDLT) for anyone looking up to £925,000 is another confidence boosting factor.

Whilst those looking to buy at the top end of the market are saddled with higher SDLT, property now appears the safer haven than stocks and shares. And as oil prices continue on their downward trend, it’s unlikely the stock market will recover to any great degree soon.

As an example, just last week we agreed a sale in excess of £1,000,000 to a London buyer. Having recently sold his second home in London, he chose to re-invest in property instead of the stock market, having only visited Suffolk for a weekend.  Weighing up the choices of low interest rates on his cash funds, a volatile stock market and cyber fraud concerns, he chose a lovely Suffolk farmhouse instead. A safe choice indeed, I say!

Caroline Edwards
Partner
Residential Sales, Long Melford
T: 01787 888622
E: caroline.edwards@carterjonas.co.uk

Suffolk: Our village love affair

Some years ago the search requirements of London buyers were highly predictable: a Georgian rectory or impressive farmhouse with a long drive and about 10 acres, all within a 10 mile radius of a mainline station for the City. Seclusion and no neighbours were significant search criteria. But fashions are changing. These days we are just as likely to find London buyers specifically requesting houses in a village or on the edge-of.

Whilst many of us would be thrilled to own the ultimate trophy country house, we are seeing more buyers wishing to be part of a community and part of the action. When you’re used to the busy lifestyle and buzz of London, as well as having everthing at your fingertips in terms of restaurants, gyms, theatres and cinemas etc, it can be an unexpected shock to the system when a rural setting can lead to a sense of isolation and setting up an account with your local taxi firm.

The pretty and vibrant villages of Suffolk make ours a very special county indeed. When these villages also provide a shop/s, pub, restaurant and primary school we are reaching a recession-proof area of the market. Certainly village houses have been the strongest sector of our market for the past couple of years and the tide is not going to change.

In the price range of about £600,000 - £1,250,000 the demand is exceptional. The wide buyer spectrum is made up of families, professionals, London buyers and – most strongly – the retirement market looking to downsize and be within walking distance of amenities. We have had a number of examples in the recent past where good houses in popular villages, such as Nayland, have brought about competitive bidding owing to this diverse demand.

Whilst this is positive news for the vendors, it can be somewhat frustrating for the buyers. We often see scenarios where cash buyers can swoop in to purchase. This creates a dilemma for those wishing to downsize from their well-loved long-term country house to such a village. These buyers are often very reluctant to sell before they find a house to move to but, the reality is, the village house is the biggest love affair in the market. Just as a faint heart never won a fair maiden, fortune (or the best village house) favours the bold.

Caroline Edwards
Partner
Residential Sales, Long Melford
T: 01787 888622
E: caroline.edwards@carterjonas.co.uk

The 7 deadly sins & 7 heavenly virtues of buying and selling

In all parts of life there are things that can raise the blood pressure; likewise there are the lovely things which smooth the ride, put the spring in one’s step and, basically, bring out the best in everyone.

The seven deadly sins are listed as lust, gluttony, greed, sloth, wrath, envy and pride. And the seven contrary virtues are chastity, temperance, charity, diligence, patience, kindness and humility.

In estate agency, we see the good and the bad highlighted on an almost daily basis and we might adapt The Old Testament sins and virtues as follows:

THE SINS

The pursuit of perfection: The ideal house has never been built and never will be. Look at properties with an open mind, heart and soul. You can make it into your perfect home with a little bit of imagination.

Refusing advice: Agents help people buy and sell houses on a daily basis; good agents know their market and have a constant finger on the pulse. Just as you would listen to your doctor’s advice, it’s a good idea to listen to your property professional. However, we do acknowledge this is likely to conflict with some armchair and dinner party experts.

Disloyalty: Disloyal buyers are on a par with disloyal sellers. Some sellers think that by changing their agent a whole new crop of buyers will miraculously appear. That rarely happens. If a house isn’t selling, it’s probably the price. So don’t be seduced by the touts. If your agent doesn’t return calls, advise on the price or put in the hard work required however – it’s a good decision to move on.

Greed: Cheeky bids are as unhelpful as unrealistic expectations on price.

Untidiness: People love to buy a lifestyle – they like to see tidy lifestyles even though they might not lead one themselves!

Poor planning: Squeezing 10 viewings into one day and wholly relying on SatNav – maps may be old fashioned but they work in Suffolk!

Rudeness: Estate agents are humans too. We’re here to sell your house as best we can and to find you the loveliest house we can. We do our job because we like people and want the best for them. People can forget this.

THE VIRTUES

The virtues are simple and straightforward and, as obvious counterpoints to the sins, require no elaboration:

Trusting your agent; possessing an open and imaginative mind; realistic expectations; loyalty; patience; tidiness; appreciation.

And remember our business is minding other peoples’ – choose an agent with integrity. Buying and selling is as much to do with people as it is to do with houses.

Caroline Edwards
Partner
Residential Sales, Long Melford
T: 01787 888622
E: caroline.edwards@carterjonas.co.uk

£3 million to help landlords meet fire safety rules

Private rented sector landlords will be required to have working smoke alarms on every floor of their property and carbon monoxide alarms in rooms where a solid fuel heating system is installed with effect from October 1, 2015.

Alarms must be tested at the start of every new tenancy - the regulations do not stipulate the type of alarm to be installed; rather, landlords should make an informed decision and choose the best alarm for their circumstances and property. Landlords who fail to comply with the duties outlined in the regulations may be subject to a civil penalty.

The good news is that the Government launched a £3million fund on March 19 which means thousands more tenants living in private rented homes will have working smoke and carbon monoxide alarms distributed through England’s 46 fire and rescue authorities.

The funding will benefit private rented houses across the country, providing around 445,000 smoke and 40,000 carbon monoxide alarms which will be available free from local fire and rescue authorities to private sector landlords whose properties currently do not have fitted alarms.

The new legislation coming into force in October that requires anyone renting out their home to ensure there is a smoke alarm on every floor of the home at the start of the tenancy is very positive and Carter Jonas property managers will ensure that our landlords adhere to this rule to ensure tenant safety.


However, whilst landlords will be under a duty to install and initially test alarms, Housing Minister Brandon Lewis, when announcing the proposals which he hoped would prevent 26 deaths and 670 injuries a year, said tenants were urged to “regularly test their alarms to ensure they work when it counts”.

Lisa Simon, 

Partner Head of Residential Lettings

T: 020 7518 3234 

E: lisa.simon@carterjonas.co.uk

Was it an administrative error?

The farmer-owned dairy co-op First Milk hit yet more trouble last Friday as their milk suppliers failed to receive their monthly cheque as expected.

First Milk blame this on an administrative error but there are continued fears about the organisation’s financial stability which must be arousing fear among the 1,200 farmers who supply milk to the co-op.

Since the turn of the year First Milk has been rocked by a number of problems that started in January when they announced a delay in paying the monthly milk cheque by two weeks.

This sent shock waves through their membership. Then in February First Milk announced a change in the way farmers would be paid for their milk by introducing an “A and B pricing contract”.

Instead of paying farmers a single price for all the milk they produce, farmers from April 1 would receive a fixed price for the “A” milk; approximately 80 per cent of their produce and a second variable price for the “B” milk.

The “B” price is being set to reflect the short-term prices such as those on the spot and milk powder markets. This clearly introduces uncertainty for First Milk members who will not know what price they will be receiving for their milk at the end of the month.

Then in March First Milk announced its milk price for April would likely end up being around 20p/litre which is well below the cost of production.

This makes one wonder how long dairy farmers can continue to supply milk at this price, especially as other dairy farmers are being paid significantly more by other milk buyers.

In this context some farmers on the best contracts are still being paid more than 30p/litre, an incredible 10p per litre more than most First Milk producers are getting for doing more or less the same job.

Why don’t farmers change contracts? Well the answer is that it is not easy to change contracts and for some there will be no choice at all. Many of the beleaguered First Milk suppliers will have to hang on in hope of better prices to come or cease dairy farming altogether.

So with the milk price at around 20p per litre, First Milk producers are facing a difficult choice and their confidence in the management of the organisation will have not grown when their monthly milk cheque failed to hit their bank accounts last Friday.  

James Stephen MRICS FAAV
Partner
Rural Practice Chartered Surveyor, Wells
T: 01749 683381
E: james.stephen@carterjonas.co.uk

Mendip Farmers’ Point to Point

In my part of Somerset our version of the Cheltenham Festival is the Mendip Farmers’ Point to Point held at Ston Easton. Well, it’s not quite that standard but to the amateur observer like me it is just as much fun.

The first of six races starts at 12.30pm and these are followed by two pony races for younger riders aged between nine and 15.

These pony races are a relatively recent innovation at point to points which provide interest and excitement for families and are a firm favourite with the crowds, rounding off the day’s racing in an informal, yet competitive and thoroughly enjoyable manner.

However, what astounds me about all point to points - the Mendip Farmers’ event is no exception - is the huge amount of work put in to make this one-day event such a great success.

There is so much to be organised, ranging from the health and safety involving doctors, ambulances and paramedics to making sure the appropriate bar licences have been secured. And that is before the course has been built, marquees erected, hospitality sorted, stewards and car parking arranged, tickets printed, trade stands set up, etc.

The list of tasks seems endless and without the generous support of many local businesses and individuals who sponsor aspects of the event, and of course all the time given freely by the committee, it would simply not be affordable.

But the racing is what it is all about and over the years the Mendip community has had its successes both locally and nationally.

For instance during the 1970s, Max Churches produced top horses, such as Rich Rose and Panmure, both of which won hunterchases, while in 1988, Mendip girl Jenny Litson, daughter of successful point to point owner Bill Gooden, achieved her goal of becoming Champion Ladies Jockey.

In recent years, more success has been seen with horses such as Double Silk, Earthmover and Double Thriller. All three set course records at the Mendip Farmers’ Point to Point, reached the top of the hunterchasing field and progressed to the higher reaches of National Hunt racing.

So, why not come along on Sunday and join the fun? There will be good quality horse racing, bookies, the Tote, bars, trade stands and a great atmosphere for the whole family to enjoy and all at a very reasonable cost for a family day’s entertainment.  

James Stephen MRICS FAAV
Partner
Rural Practice Chartered Surveyor, Wells
T: 01749 683381
E: james.stephen@carterjonas.co.uk

What the energy efficiency proposals really mean for the PRS

With apologies to Mark Twain for the paraphrasing, reports of the demise of poorer-rated, less energy-efficient domestic rental properties have been greatly exaggerated.

Twain was referring to the premature publication of his obituary notice. He was happily able to tell the world he was still alive.

Publication by the Department for Energy and Climate Change (DECC) of the Private Rented Sector Energy Efficiency Regulations (Domestic), which sets out the views of the Government on proposals for energy efficiency in the private rented sector (PRS), led to immediate reports that properties with EPC ratings (placing them in Bands F and G) could be doomed.

On the face of it, that’s what the document says. But read it and the story is less pessimistic. Owners of such properties should not give up hope.

The basic premise of the document, a response to a wide consultation on making let properties more energy efficient, is that from April 1, 2016, domestic tenants will have the right to request consent to make energy efficiency improvements and landlords would need to respond within a month under the regulations that have been laid before Parliament.

The minimum energy efficiency standard applied to all categories of domestic private rented property will be set at E energy performance, in line with the non-domestic sector. From April 1, 2018, the regulations will apply upon the granting of a new tenancy to a new or existing tenant, extending from April 1, 2020, to all privately rented property within the scope of the regulations.

But, crucially, there is the ability for landlords to seek exemptions. The essential paragraph reads:

Where a landlord considers an exemption applies allowing them to let their property below the minimum energy efficiency standard, the landlord will need to provide such evidence to a centralised register, the “PRS Exemptions Register.” Landlords may be required to submit relevant evidence and details of their exemption to the Register. The Government may use this information to assist local authorities in targeting their enforcement activity.

There will be a number of safeguards to ensure that only appropriate, permissible and cost effective improvements are required. Landlords will be eligible for an exemption from reaching the minimum standard where they can evidence that one of the following applies:

- They have undertaken those improvements that are cost-effective but remain below an E EPC rating. Cost effective measures are those improvements that are capable of being installed within the Green Deal’s Golden Rule. This ensures that landlords will not face upfront or net costs for the improvement works.

- They are unable to install those improvements that are cost-effective without upfront cost because the funding entails Green Deal finance, and they or their tenant fail the relevant credit checks.

- The landlord is required by a contractual or legislative obligation to obtain a third party’s consent or permission to undertake relevant improvements relating to the minimum standard, and such consent was denied, or was provided with unreasonable conditions.

- The landlord requires consent, and the occupying tenant withholds that consent.

- Measures required to improve the property are evidenced by a suitably qualified independent surveyor, for example from the Royal Institution of Chartered Surveyors (RICS), as expected to cause a capital devaluation of the property of more than 5%. Only those measures that are expected to cause such devaluation would be exempt from installation.
- The regulations will also include specific protections relating to wall insulation improvements as an additional safeguard for the minority of situations where such insulation may not be appropriate. There will be no requirement to install wall insulation under the regulations where the landlord has obtained a written opinion from a suitably qualified person or from the independent installer engaged to install the measure advising that it is not an appropriate improvement due to its potential negative impact on the fabric or structure of the property (or the building of which it is part).

The long term hope is that the ratio between the cost of implementing change in comparison to the value of savings to be made in the domestic energy bill will naturally adjust to the point where they coincide in the vast majority of cases. The recent fall in oil prices, and consumers’ hope that domestic energy prices will follow more closely, might damage these prospects in the short term.
However, energy prices will inevitably rise again in tandem with technology improving to make energy efficiency more easily achievable at affordable costs.

Coupled with this is the knowledge that no Government will want to willingly remove otherwise good housing stock from the PRS. The political colour of the UK Government at Whitsun is likely to be very different from that of the Government on the May Day bank holiday. But whether the predominant shade is blue or red, and whatever fringe parties are tugging at the sides of the wheel to get their own policies into play, neither major party will steer a course that sees homes with lower energy efficiency ratings removed from the PRS in the foreseeable future.

Labour will not want to deny people perfectly good homes when voices are already loudly raised about the amount of good housing stock that stands empty. The Conservatives, with their commitment to austerity, will not want to fund the replacements for these homes from the public purse. Of course, nobody will get away with using the regulations for letting seriously sub-standard property and nor should they.

The Government is promising guidance between now and the implementation of the regulations from April 1 next year and there’s a requirement to review the operation and effect of them at no less than five yearly intervals, with the first in 2020 by which time it will have evidence about the progress and effectiveness of the regime.

Far from being a portent of doom for domestic rental properties in Bands F and G, look on the proposals as a long term fitness regime for the less able to be brought up to peak physical performance and with the proviso that those who can’t won’t be relegated to the scrap heap.

Details of the legislation can be found here.

Lisa Simon, 

Partner Head of Residential Lettings

T: 020 7518 3234 

E: lisa.simon@carterjonas.co.uk

UK landlords should take care in reporting rental incomes

With the January 31 deadline for submitting self assessment tax returns to HMRC and paying any income tax due now passed there’s a temptation to put all thought of tax affairs to the back of your mind.

Some time ago, HMRC announced it would be looking into under declarations of rental income by landlords in its Let Property Campaign, giving buy to let and other private landlords the opportunity to make a full and voluntary declaration of any tax owing on relatively favourable terms.

HMRC has widened its sweep and has the power, through issuing statutory notices, to force lettings agents to provide details of rents collected on behalf of all landlords. It estimates up to 1.5 million landlords may be under declaring every year and has sophisticated data gathering abilities to check figures.

Already, it has announced that almost £8 million has been collected from landlords who under declared so make sure your house is in order, so to speak, and voluntarily contact HMRC if you suspect there may be anomalies.

Tenant deposit loans

In the last issue of Clearer View I outlined the new tenant deposit loan scheme launched by the Government into both the public and private employment sectors.

It’s worth pointing out that if a deposit is being paid by a third party on a tenant's behalf by way of an agreement with that tenant then the s213(10) of the Housing Act 2004 definition applies to those paying deposits on behalf of tenants as "relevant persons" and they must be served the information prescribed by the Housing (Tenancy Deposits)(Prescribed Information) Regulations 2007 covering key information about the tenant deposit and where it is protected.

Failure to do so could mean it is not possible to serve a valid notice under s21 of the Housing Act 1988 on any tenant when the prescribed information has not been served on them and on any relevant person. In addition either the tenant or the relevant person (or possibly both of them) can make a claim for the usual financial penalties.

Landlords and agents must convey the necessary information to employers in good time.

Lisa Simon, 

Partner Head of Residential Lettings

T: 020 7518 3234 

E: lisa.simon@carterjonas.co.uk

Farmers to be allocated entitlements

Farmers should be aware of one unexpected consequence of the introduction of the new Basic Payment Scheme (BPS) which seems inherently unfair and is as a consequence of a “one off” rule that will be implemented this year only.

Under the new scheme farmers will be allocated “entitlements” which they need to use to claim against their land. One entitlement will need to be matched against one hectare of qualifying land in order to make an effective claim. The new BPS entitlements will be derived from the old Single Payment Scheme (SPS) entitlements that a farmer already holds.

Under the old scheme, farmers were able to hold more entitlements than land; they could not claim on the spare entitlements but provided they used them every other year they could hold on to them. However in the first year of the BPS any “spare” entitlements will be confiscated without compensation which for most farmers will not have a significant impact.

For those farmers who take on extra land in 2016 this may be a problem if they are not able to acquire the matching number of entitlements from the outgoing farmer because the supply of spare entitlements will be restricted to those farmers who can no longer claim on all some of their own land next year. This may be because they have built a solar park on their land or sold land for development for example.

But, there is one group of farmers where the new rule will have an unexpected consequence and that is farmers whose land may be affected by an infrastructure project in 2015. Such projects are often temporary in nature and may involve a water company installing a new sewer or water pipe for example. Here land will be temporarily taken out of production along the route of the pipe and where contractor’s compounds or pipe stores are required.

In such instances farmers will generally not be allowed to claim on the affected land because it will not comply with the myriad of “cross compliance” rules which are a feature of the both the old SPS and BPS. However, if this land cannot be claimed on in 2015, the farmer will permanently lose the matching entitlements even though the loss of land has only been temporary and has been at the behest of a third party out of the farmer’s control.

I have enquired whether these circumstances could be considered as “force majeure” thereby exempting a farmer from losing entitlements but I am informed this is not permitted. Therefore farmers affected by schemes that will result in a temporary loss of land this year will incur a permanent loss of the equivalent number of entitlements. This will not happen in future years because the ongoing rules allow entitlements to be used every other year.

Therefore if any farmers are likely to be affected by such a scheme please do to contact me and for free advice on this subject.  

James Stephen MRICS FAAV
Partner
Rural Practice Chartered Surveyor, Wells
T: 01749 683381
E: james.stephen@carterjonas.co.uk

Taking Stock

Last week saw three different professional firms come together at the Bath and West to address the problems currently facing the dairy industry as milk prices have plummeted in recent months.

The seminar entitled “Taking Stock” was hosted by land agents, Carter Jonas, the Shepton Vets and the Farm Consultancy Group (FCG). The aim of the event was to assess the strategies farmers can employ to survive the current difficult trading period and in general, despite the current problems the message was reasonably up beat.

The overriding message that came across from all three firms was the importance of a farmer understanding his business inside out and managing all aspects to keep costs of production under control.

In the last year or so, while milk prices were reasonably high it seems some farms may have taken their eye of the ball in this respect and Hollie Savage of Carter Jonas and James Shenton and Phil Cooper of the FCG all emphasised the need for farmers to analyse their business carefully, benchmarking their costs of production against competitors so as to identify where improvements can be made.

Similarly Paddy Gordon of Shepton Vets explained the importance of a farmer understanding all aspects of the herd’s health and importance of using your vet to provide regular consultancy advice rather than just calling the vet when an animal falls ill. In so doing Paddy illustrated how the cost of regular advice will be far outweighed by an increase in profits as mastitis can be brought under control and pregnancy rates increased.

Tom Ireland from Carter Jonas addressed other opportunities in relation of renewable energy issues in particular where he explained that there are still significant opportunities for farmers, although obtaining planning consent and locating an appropriate grid connection remain significant obstacles. However he also emphasised that as subsidies begin to fall, the profitability of a renewable energy installation will become increasingly reliant on understanding the farms energy needs and matching that to the electricity generated. This is because it will be increasing important to use your own electricity rather than exporting it to the grid because this will produce a much higher return.

So in conclusion, although it was acknowledged that some dairy farmers may leave the industry, the speakers were confident that the majority will survive. However, in order to receive a sensible return for the massive financial and time commitment required to run a successful dairy farm, hard work alone will not be enough; farmers will need a thorough understanding of their business and act to control costs in particular.  

James Stephen MRICS FAAV
Partner
Rural Practice Chartered Surveyor, Wells
T: 01749 683381
E: james.stephen@carterjonas.co.uk

Catch me if you can

Last Friday I considered myself beyond privileged to meet the racing legend Frankel, my hero horse. It was a magical day made possible by the wonderful Jim Power who, not only was the Stud Groom for Banstead Manor Stud for many years but also, significantly, brought Frankel into the world. Frankel, the progeny of Galileo and Kind, was foaled at the stud on 11 Feburary 2008. In chocolate terms, my day with Jim Power and Frankel and, later, at the Newmarket Foal Sales was like winning the golden ticket for the Willy Wonka Factory. I was in horsey heaven.

I asked Jim when Frankel started to stand out amongst the crowd and he described him as "a lovely natured foal who owned the paddock”. He has described him as a “straightforward yet sensitive horse, with a slight air of arrogance about him - really top class racehorses often have that character.”

On Friday, Jim was quick to spot the high earners of the day as the fluffy foals were led around the paddock including top selling foal, son of Sea The Stars, purchased by Shadwell for 450,000 guineas.

Frankel raced 14 races and won all of them. Owned by Prince Khallid Abdullah, he is the first horse to be Champion at two, three and four-years old as well being crowned the Cartier Horse of the Year for two successive years in 2011 and 2012.

Frankel’s unquestionable supremacy translated into the exceptional prices achieved when his first two foals were sold: the first in June 2014 for £1.15m, whilst the second broke Irish records a week ago when it sold for 1.8m Euros (about £1.45million).

Yes, so much is down to the dam as well as the stallion, and Ireland’s success was much owing to the talent of the filly’s mother, Finsceal Beo (‘Living Legend’ in English) who won The 1,000 Guineas in 2007.

But what does this have to do with the residential sales market? Friday - my amazing day – was, surprisingly, a slow day for Frankel’s foals. The TV cameras were poised, the hype had been mounting, but out of his four foals due to be sold, the first was withdrawn following an over-excited jig in his stable and the following three did not meet their reserve prices, albeit one was subsequently sold to a privately increased bid.

I asked Jim Power what would happen to these adorable un-sold off-spring? How could they have not sold, despite their parentage and the amazing selling skills of three, non-stop-incentivising-supremely-knowledgeable auctioneers?

The talent was there, the genes were excellent, what more could one want? I truly felt for the owners and the auctioneers. It was no different to how I feel when I have launched an exceptional house to the market but I don’t find the buyer immediately, despite knowing the quality of what I am selling and promoting it with absolute gusto.

Jim’s answer was that the owners would probably wait until the Yearling Sales to re-present Frankel’s offspring to the market in order to achieve their deserved sum.

This is the property market too.

There are absolutely beautiful houses which have been brought to the market this autumn but have failed to sell. This isn’t down to their quality, however. Ask any estate agent (who really knows their salt) and the resolute answer to the question of “when is the best time to buy?” is: “NOW!”

We’re not saying this because we’re keen to get Christmas sales up, it’s because for a fourth year in a row we have not experienced the autumn market we were expecting.

We are in a new cycle. January and February are now key selling months.

January takes off at a gallop following the Christmas family ‘get-togethers’. Country Life, Rightmove & Zoopla report an annual peak of website hits in the latter part of Christmas Day. Decisions are made around the roast turkey and crackers and the newly-focused buyers want immediacy. They do not want to wait until the daffodils come out before a house is launched to the market.

This is why NOW is the right time to buy. Like Frankel’s unsold foals, look at what is out there now - don’t let the great and the brilliant pass you by - your ideal house may have already been withdrawn from the market only to be launched to the market in a few months time for a higher price. Call your agent now to discuss what is currently ‘hidden’ from the market. Vendors are more likely to consider genuine and unambitious offers this side of Christmas before the starting gates open in January. Unlike the retail market, you are likely to find your better purchase deal in the run up to Christmas - if you are waiting for the January sales you need not apply.

Finally, in estate agency, we often hear the expression “if it’s not meant to be, it’s not meant to be” – this expression frustrates me more than any other. If you want something don’t let it lie in the hand of fate - go for it. If you want a house - don’t hang about. Don’t be reserved in showing your agent your keenness to buy. It is your enthusiasm that gives us confidence in you and your genuineness which we, in turn, convey to our vendors. Enthusiasm also puts you at the top of our contact list for our ‘discreet’ properties which we are lining up for early 2015.

So, whilst I’m throwing fate out of the equation with my previous paragraph, I have noted something interesting: Frankel was born on 11 February 2008; his first foal was born on 11 January 2014 and our racing hero was trained by the legendary trainer, Henry Cecil, who was born on 11 January 1943.

Noticed anything? Apparently number 11 is considered to represent the Master Teacher which is believed to be an inspirational guiding light - someone who is highly charged, very powerful and leads the world.

Caroline Edwards
Partner
Residential Sales, Long Melford
T: 01787 888622
E: caroline.edwards@carterjonas.co.uk

Our ping-pong recovery

It was exactly three years ago when I was advised that ‘being on the brink is the new normal’ for what, at the time, was the foreseeable future. In 2011, many weren’t willing to assign a specific number of years to ‘the foreseeable future’ but I think we can say that, three years on, we are back from the brink, economically.

Yet as many economic and financial commentators judge, the country is still in a strange state of being where one set of indicators suggesting positive news is offset by another giving a gloomier gloss to our recovery. Yes, the economy is growing but there will be a shortfall on the deficit above £100 billion by the end of this year.

One Eurozone economist recently characterised the UK’s growth as ‘the wrong type of growth’. Much like the seasonal ‘leaves on the line’, it’s probably the best explanation for the feed of ping-pong, back and forth, contradictory economic data this autumn and the balancing act those politicians charged with running the country are having to perform day-in and day-out as our recovery plays out.

Perhaps the bruising economic experience the UK has endured since 2008 has changed our perceptions of what amounts to recovery. Pre-crisis, debt-levels being 40 per cent of national output were considered high but now it’s 80 per cent which is the trigger point at which the credit rating agencies talk about withdrawing our triple AAA status.

The shortfall on the deficit by this year’s end would have been considered big in times past at 6-7 per cent of national output but it is not as big as it was at its 9-10 per cent peak in 2008/2009.

In October, published figures recorded that unemployment had fallen below the 2 million mark for the first time in six years. But in this current tax year of 2014/15, income tax receipts are up by just 0.1 per cent yet outlay on social benefit payments has gone down.

Wage inflation runs at just 1 per cent at this point in our recovery but the Bank of England is anticipating 3 per cent wage inflation by the end of next year and therefore tax receipts will be up.

It may feel like a heavy trudge through the recovery now but many analysts are convinced there is good news in the pipeline and, thankfully, the wisest market operators will always invest for the long term.

Before that, we have the General Election in May and all bets are off that the Chancellor of the Exchequer’s Autumn Statement – scheduled for early December – will be anything else but a necessary political and economic balancing act of ‘Austerity Lite’. There is likely to be further squeezing of public expenditure but the pinch will not be as nippingly sore as it was in the early years of this administration.

In this ping-pong recovery of ours – in which we are growing faster than Germany - whether it’s politics which is the foil to economics or vice versa, balancing is not an act: it is the reality.

Much as we did in 2011, we are going to have to accept this new reality of our recovery for the foreseeable future.

Will Mooney MRICS
Partner
Commercial, Cambridge

Lack of gas safety certification will have major consequences

British Gas has revealed that 14 per cent of landlords among their customers who took part in a survey knew nothing about gas safety regulations.


It would be nice to think they had just sampled the wrong customers but that’s not likely to be the case.

With recent prosecutions seeing several landlords fined heavily for not having gas safety certificates for their properties and the startling results of that survey, perhaps it’s timely to remind all our landlords that gas safety inspections are a vital part of being a responsible landlord.

Sometimes it’s easier to remember essential electrical safety checks just because the signs of the power source are so obvious with sockets and plugs in virtually every room.

Gas, though, especially when powering hidden equipment such as boilers, is less apparent and much easier to ignore. Sadly, when things do go awry it’s also more difficult to detect. True, straightforward leaks are apparent by the smell of the escaping gas but when a gas appliance malfunctions in its combustion or exhaust processes the resulting leak of CO, a highly toxic and invisible gas with no odour, can have disastrous consequences. Victims of CO poisoning can, at worst, drift totally unaware into a deep sleep from which they never awaken.

Every landlord should ensure that all gas supplies and appliances are checked and certificated every year without fail. Where we are instructed to manage your property, we will arrange this on your behalf.

Lisa Simon, 

Partner Head of Residential Lettings

T: 020 7518 3234 

E: lisa.simon@carterjonas.co.uk