Winning the race

Tuesday 18th July 2017 19:30 EDT
 
 

We managed to exchange on a deal we were in a race on. I expected we would do so for a couple of reasons, one was we could take a commercial decision on some of the unknown variables and the other we had a very good lawyer on our team who was all over this deal.

A deal moves as fast as the slowest component, in this case it was the sellers lawyer, who was acting in a very sloppy manner even for a normal conveyancing, let alone a contract race. After a stiff word with the partner, the lawyer assigned to the case was switched, and we then started getting a reasonable level of service. In order to close the deal quickly we transferred the exchange amount to the sellers lawyers account, which was held to order, meaning they cannot do anything with it without the permission of our lawyer.

The deal was a large lateral flat which consisted of 2,200 sq. ft. Originally arranged as three units, it was being sold as one physical flat but as three leases.

The price was £1.6m, which equates to £730 per sq. ft. To give this number some perspective, normal flats in this block have sold for £1,250 per sq. ft. We have sourced many over the years and know the block well. A new build in Wembley, not even in the best area, would be priced at £650 a sq. ft. In short, this was a very good deal.

The aim will be to reconvert it back into three two bed, two bath flats; and hold as a long term rental. This flows with the market, as we are looking at an uncertain two if not three years.

The block, in honesty, is not desirable according to me. However, the Arabs love it; and prices have always been rising here. It’s in very close vicinity to Marble Arch, and part of the block is on Edgware Road. This flat was located in the nicer part of the block, with access through a large communal garden and off the side road.

I asked the agent if he could approach the losing party, and ask them if they still want the deal at £200k above the deal price. I got a response back saying that was a cheeky thing to even ask, but that they would ask the party they were going to flip the deal to, to see if they would increase the price they would pay! There was enough money on this deal for it to be sold again, and the final buyer still would end up with a great deal on his hands.

A property in W2, which our client has recently exchanged on for less than £700k, has been placed in tomorrow’s auction, for a guide price of £775k. We have added some value by pointing out a mansard could be added to the property, at which point you would have an increase in the square footage from 700 to 1130; changing the flat from a two bedroom to a four bedroom.

We are hoping for a higher resale price, but the market is a shaky one, and you need to ride the market sentiment.  We will see what tomorrow brings! 

Agony Agent is here to help!

Q: What is a Revenge Eviction?

A: "Revenge Eviction", as it's known in the media, is when a landlord ends a tenancy via a Section 21 Notice after a tenant has complained to the landlord about a matter relating to the property. This part of the Deregulation Act, that came into force in October 2015, is not widely known or understood by all.

A Section 21 Notice (S21 Notice) was imaginatively named after Section 21 of the Housing Act 1988, which allows a landlord to regain possession of their property, but only at the end of an Assured Shorthold Tenancy or Fixed Term Tenancy agreement. Landlords are able to issue a Section 21 Notice without giving any reason for ending the tenancy agreement, and this is where some of the controversy has stemmed from. The new law centres around the fact that landlords will now be unable to issue a Section 21 Notice if their tenant has previously complained (in writing) about the condition of the rental property and the landlord has failed to deal with the complaint properly and within a reasonable time period. The term ‘Revenge Eviction’ or ‘Retaliatory Eviction’ has been created by the media, reporting of certain cases of landlords serving a S21 Notice after tenants had complained about the condition of the property.

Tenants must be able to raise issues with their landlord or agent without the fear of losing their home and the few landlords who have undertaken such practice deserve to be punished, however, as with most cases the minority spoil it for the majority.

Some agents and landlords in opposition to the changes say that tenants could exploit the new law by making claims in order to delay the eviction process, resulting in lengthy delays in regaining possession or high court costs.

What are the changes in the law and how do they affect you?

l When a tenant complains, in writing, to their landlord about the condition of their property, the landlord has 14 days to respond.

l If the landlord responds and then carries out the work, there’s no impact to serve a S21 Notice in the future.

l If the repairs are not carried out or the landlord fails to respond to the tenant’s written complaint within 14 days, the tenant then has the right to complain to their council.

l The council then should decide whether it wants to issue the landlord with a relevant notice.

l If the council does not issue a relevant notice, this does not affect the landlord’s right to issue a Section 21 Notice.

l If the council does decide to issue a relevant notice, as well as having to carry out the repairs/improvements to the property, the landlord will not be able to serve a Section 21 Notice for 6 months from that date.

The details set out above are a snapshot, and are in no way exhaustive. If you’re worried about the changes it is worth getting in contact with me to get more information. As long as you have not fallen into the trap of not keeping your property maintained well, then giving notice should not be an issue.


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