The Alex Goldstein Property Show (Part 8)
Join property authority Alex Goldstein in this fast paced property podcast when we discuss the issues to avoid when letting
out your property and as a tenant with property lawyer Mark Fagan from Winston Solicitors in Leeds.
We also discuss ornamental trees and how to add value to your home with expert Alexander Hunt.
What to be aware of when converting your attic and how emotions affect our decisions when buying and selling property, plus lots more!
The Alex Goldstein Property Show (Part 8)
Full transcript below:
Alex: Welcome to the Alex Goldstein Property Show. We are fast paced, informative, insightful and push the boundaries when it comes to giving you the very best insider knowledge, know-how and expertise in the property market. We’re the only property show on Stray FM and our aim is to ensure you make the best decisions when it comes to your property. We’re available for podcast download on the first of every month, so sign up to Alex Goldstein social media accounts to get an earlier reminder or this and to get expert property advice whenever you need it. In this month’s show we’ll be speaking with a top Harrogate Lawyer on the pros and cons and tricks of the trade when it comes to renting out your home, a tree expert who supplies across Yorkshire and gives us insight into adding value to your home. Plus, of course the Alex Goldstein top tips. An incredible amount to fit in so let’s get straight on with it.
This month we’re talking about property and the emotions involved. It’s long been known that this is one of the most stressful things you can do in life and personally I think this is much because we’ve got to navigate through a series of time sensitive situations and this is often exacerbated by emotions running high and let’s face it sometimes to breaking point. Now property, if we think it through is probably the only deal we ever do in life where money, feelings and as a result stress all run equally high at the same time. So, let’s look at the property process itself. You come to sell your home, it’s a very big decision just to reach that decision, not only if you worked hard to secure the property first time around when you purchased it, that you’ve invested in improvement and had numerous highs and lows within it, the walls can talk as they say. As a homeowner you’ve invested emotionally in the property so when it comes to placing your home on the market you listen to the TV, the newspapers and the media and you get hoodwinked into thinking that making everything plain and white is the right way to go. Well that’s wrong because remember property is emotional, so play to these strengths, keep the photographs of the children on display, the log fire burning or perhaps some cookbooks out by the agar. People are buying into a lifestyle choice so present your home to a similar theme. You then invite a couple of estate agents to pitch for your business and whilst thoughts on guide price always rightly or wrongly seemed to be the defining factor in choosing the right agent, so does the way you feel about the agent personally. Do they love and infuse about the property as much as you would like and if they don’t I bet you’ll show them the door. If they do you’ve made more of an emotional connection with them. Now the very last step is as a seller. Once you’ve secured a buyer for your own property the tables now turn and you’re the one immediately under pressure trying to find that elusive right property and trying to bring all the different elements together at exactly the same time. You’ve also got to keep your own buyer happy and you’ve got to check everything is progressing smoothly, again it gets emotional. So yeah, buying and selling property is stressful. Our emotions play a huge part in how much we allow the anxiety pressure gauge to rise by. By taking a pragmatic approach and planning everything well in advance this will go a long way to ensuring that your next property deal is less stressful. Hopefully you may just surprise yourself and actually enjoy it.
It’s great indeed to have Alexander Hunt on the phone. You’ve got a couple of businesses actually, just talk everyone through, because they’re quite niche and very unusual actually.
Alexander: They’re two horticultural businesses here both in a village near Sevenoaks called St Mary’s Platt. Firstly, there is Potash Farm, where the cobnut and walnut are grown. I grow and pick about 40 acres of nuts here and we make a whole lot of specialist products and chocolates, biscuits, oils, a balm with the nuts. Then I’ve got the tree business which is the country’s leading nursery in the supply of fruiting walnut, timber walnut, almond, Kentish cobnut and sweet chestnut trees. And they go all over the country Alex as you well know.
Alex: Indeed, I mean you supply across the UK and Yorkshire. I mean whereabouts in particular, obviously we’re in Harrogate at the moment, so where in Yorkshire do you supply?
Alexander: We’ve got some very good garden customers, we split them up slightly into three categories here but the garden customers very much in the Harrogate area and the villages around Follifoot is a one that comes to mind. York, Richmond, Northallerton and these are people that are really sort of developing their gardens in a slightly specialist way and might be ordering one or up to half a dozen trees from us. And then we’ve got the larger sort of farmer and estate customer and one or two very well-known estates in Yorkshire that we serve near sort of Helmsley, Harewood, Barnard Castle, Ripon etc.
Alex: Wow, so you really are doing the prime points throughout Yorkshire, you’re mighty impressive. I suppose, depending on the amount of space because I know this is something we’ve always talked about, it doesn’t matter necessarily whether you’ve got an estate with a number of acres or indeed you’ve got a much smaller garden. I know you’ve certainly on the tree business side you’ve got sort of something that can help everyone.
Alexander: Very much so, I think for the smaller garden we sell a lot of cobnut and almond trees to those perhaps in Belgravia/Chelsea who have sort of gravel gardens and are growing nut trees in pots, to the small garden right up to the big estate or farm where they’ve got very much more space or houses with paddocks where of course sweet walnut or chestnut trees are very attractive to have as well, but they given time will be the height of the church tower of course.
Alex: What would the estates look to you for?
Alexander: I mean they are, they’re looking to possibly sort of grow them and increase their tree numbers in their very nice parklands or perhaps if they were redoing a avenue up to a house or the main house on the estate they would use our trees. But more oftenly or often than not it’s the timber selections that they’re after, and I’m one of the very few nurseries in the country that supply timber selections for the walnut timber which is used for furniture, veneers, inlays etc. And for some of these very big estates in Yorkshire a forestry and the sale of timber is very much part of their mixed income these day on modern estates.
Alex: Right ok and I mean what sort of things? Is it just purely on the forestry side that they look to you for or will they actually use the products that the tree produces or is it a mixture?
Alexander: Well I think it’s a mixture. I think a lot of people looking for advice whether the trees will grow well on a variety of soils etc. and then you know I give advice to the garden person who’s buying one tree to the farmer who perhaps wants to plant a block of fruiting walnuts, to the estate owner who wants to plant walnuts for Timber. We’re advising on all those and at the end of the day if there’s a bonus there where the family can pick some nuts and then make some nice dishes with them in the kitchen etc, particularly in the Autumn, the lead up to Christmas, so much the better that’s a really nice bonus.
Alex: Fantastic, and I know you also advise on new build development sometimes actually and in terms of softening the look of that.
Alexander: Quite a lot of new work now is often on the landscaping and design and planning with builders etc. I’ve got some very big clients, we’re doing some advisory work across the country and I’ve got no doubts that some of these schemes are greatly enhanced by the right planting of good nut or other trees. I think they’re adding value to the properties whether they be new or existing in quite a major way.
Alex: And I dare say all the different tree species that you offer, they have all different uses depending on what type of screening or otherwise that you’re looking for.
Alexander: We’ve got a very wide selection of freezing walnut trees and we do, I’ve just picked out two to talk about, one is the new one I’m introducing called the red Danube walnut which is a copper beech type leaf tree, most attractive with a sort of claret coloured nut that I think we should sell extensively with our purple filbert being one of the top nut species that we sell, that again has a reddish leaf, a reddish nut with a catkin, two are very attractive near a house or against the wall etc. Almonds of course can be trained onto any shape, or an espallia, lovely for a sort of cottage garden or perhaps a slightly enclosed or more sheltered space. And of course, you’re a little bit more frosty up there than we are in the South East, here we’ve got three particular selections of walnut that we recommend in Yorkshire going up to borders and Scotland, fernet and fern or franket which are later coming into budburst to miss some of those early or later frosts.
Alex: I know actually interestingly the BBC have been in touch with you and I know that you did a film feature with them. Just talk everyone through that.
Alexander: I was on Countryfile just three weeks ago with John Craven, they came and done a day and half’s filing here for the little slot on Country File. It was perfect timing for us in the nut world and the nut growers across the country to get the coverage as we did three weeks ago. Amazing with 10 million people viewing Country File and we’re also appearing at the beginning of December on a junior Country File programme called Down On Your Farm, which is going to be the early part of December at sort of 5:30, which is like a children’s version. We had a day filled filming here with the village primary school children and that will appear again at a very good time just for the lead up to Christmas.
Alex: Fantastic. I mean that’s the television side. What about, dare I say, you’ve been featured in Newspapers and magazines.
Alexander: We, I have a PR Consultant called Lisa, she’s extremely well known in the niche food business and she gets about six or eight national mentions a year, which is all part and parcel of the modern mix today and you know we’re heavily featured in one or two of the very popular food bloggers, with all their readers today. So not only have we got a bit of TV and radio coverage, we’ve got the basic magazines that pick-up articles and photographs of us, the social media side and of course all our range of direct customers, trade customers and website customers as well.
Alex: Fantastic. If anyone wanted to sort of delve into further detail, what are the best ways to contact you?
Alexander: I think the best way is simply on the farm office line which is a simple 01732 882734, if anybody Google’s Potash Farm near Sevenoaks we come up there and the tree business, if you Google in walnuttrees.co.uk that gives you the two websites, the main phone number or you look at my professional profile on LinkedIn, Alexander Hunt, you’ll find all those ways of communication.
Alex: Fantastic, Alexander great to speak to you and thanks so much for giving us an insight into your world.
The property hospital is all about me answering your property woes and worries when it comes to your experiences in the property sector. Now this week I’m answering a question from Lisa who’s got this to say.
Lisa: Alex, I’ve been into the estate agents to sign up to their mailings to get the brochures, but I’ve received so many that I feel irrelevant, why is this?
Alex: Lisa, interesting question there. Now, the simple answer is that as buyers we say and think we definitely want a specific type of property we’ve described to the estate agents, however as human beings we will also consider the grey areas when it comes to property. So, therefore estate agents are likely to send you properties that are going to push your boundaries as one might just tempt you. Don’t be put off by this and use it actually to your advantage and turn it around. Use the information they send to build up your own personal database to help you form a strong picture of what you definitely do want and what you do not want. As I mentioned earlier in the programme, property is about emotions and no estate agents will be able to know how you personally feel about property, unless they run it past you. I hope this helps.
Voiceover: The Property Hot Seat
Mark: Mark Fagan.
Mark: Winston Solicitors.
Voiceover: Years’ experience?
Mark: Seven years.
Alex: It’s great to have in the studio today Mark Fagan from Winston Solicitors. Mark, I hear obviously you’re very much a Leeds based company, but I hear you’re very much planned to foot at the moment.
Mark: Exciting times within the company, we are moving to Harrogate, it will be in the town centre, but I can’t say for definite as of yet.
Alex: Secret, all to look forward to but I know you’re an expert and lawyer on litigation. I thought we’d just sort of talk through the rental and the landlord and the tenant side of things, which I know you do a lot of and as you see it from a landlord perspective, what are the pitfalls that you really need to be aware of when you’re letting out your own property, your home at the end of the day?
Mark: Initially and surprisingly is the number of landlords that don’t actually enter into a written tenancy, even if you are renting to a friend or a family member its important that you do get the tenancy set out in writing. With regards to the tenancy itself the most common is a assured short hold tenancy of a residential property. Again, a problem which becomes common is whereby people are renting to employees or a company an assured short hold tenancy for a residential property must be in an individuals name as a tenant. You can’t name a company, if it’s a company it becomes known as a company let so a common law tenancy and then there are a whole world of problems that arise from that.
Alex: And I guess you also have issues if you’re renting to a friend of yours as well. You should get something in writing as a bare minimum but I’m assuming an AST, assured shorthold tenancy is the way to go.
Mark: Yeah definitely because it protects the landlord and also protects the tenant, so each party knows what their obligations are, what their liabilities are, so if there’s ever a dispute or an issue you can rely on the tenancy and what’s set out in that.
Alex: And what can you do? I mean often albeit it’s a lot of scaremongering out there but if for example you get unfortunately a rogue tenant, they do exist, they don’t pay for example, or they don’t treat the property particularly well, what can you actually do as a landlord to counteract that possibly in the first instance and B if it does happen what can you actually do about it?
Mark: With regards to rogue tenants, obviously it’s difficult to see who is a rogue tenant. You can carry out your reference checks etc, which you can do through your agent. With regards to if you’ve got a rogue tenant in the property, if they’re falling behind in rent, they’re not paying their rent, they’re in arrears, you can evict them within the fixed term of the tenancy, under what is known as the section 8 procedure. Now, that can only be used where the tenant is normally over two months in arrears. You serve the notice, it has to be in a prescribed format, you give the tenant two weeks to pay and rectify the issues, if they don’t pay then you can issue court proceedings to get them evicted.
Alex: But what are the costs involved, I mean if your drafting it yourself, you talk about lawyer costs and all of that, you’re going to court, I mean surely this is going to be quite a ordeal all round.
Mark: Well me personally I tend to do things on a fixed fee, so it will depend on the basis of the, you’re going for possession, so if it is purely rent arrears you’re looking at a couple of hundred quid plus VAT to deal with that. Court fee, unfortunately that can’t be avoided that’s £355. If you’re going on a section 8 procedure, providing the tenancy allows it, you can reclaim these costs from the tenant themselves, so they get added to the amount of the arrears which you’re claiming which is good. The downside is if the tenant has nothing and you can’t recover from them, then it’s possible you won’t recover any money at all.
Alex: But at least I suppose the flip side is you’ve got them out and can start afresh. I mean I suppose what you’re saying is there are no guarantees, you can sort of do the background check you can sort of gauge the type of individual the tenant is but at the end of the day, it is a gamble with your own home if you are going to let it out and the tenant lets the side down well, there are ways to get round it and get them moved on so to speak, but otherwise your taking a bit of a step in to the unknown, is that a fair comment?
Mark: Yeah definitely yeah. Obviously, you can’t tell just by looking at a tenant what they’re like. Also, a tenant they may have a great financial history in the past, things can happen, they can lose their job for example, if that’s the case and these are things that unfortunately a landlord cannot foresee.
Alex: True, I mean there tends to be a lot of confusion I think out there whereby someone’s looking to sell their property, they’ve got a tenant currently there, what rights as a homeowner, as effectively a landlord do you have to conduct viewings at the property to try and sell at as that’s your end game plan and indeed how can you go about exchanging contracts with a tenant specifically in the property?
Mark: Normally if the tenancy is well drafted it will have a clause in there that will allow the landlord to re-enter the property upon giving if normally 24 hours’ notice to the tenants and that will allow the landlord to go in obviously carry out viewings etc. but should also be a clause in there which will allow the landlord to put say a for sale sign or to let sign in the garden. When the landlord does enter the property, I advise that they always take a witness with them just in case there’s ever a issue over possibly missing items or whatever, at least the landlord is covered in that way. When it comes to actually selling the property, if you’re purchasing a property which has got a tenant in there and you don’t want that tenant to remain, you need to make sure that the seller has served the relevant notice on the tenant, otherwise the person purchasing the property is then stuck with the tenant and then has all the costs of dealing with it themselves.
Alex: Ok, now just I suppose to turn the tables for a moment, looking from a tenant perspective, you hear a lot about these new witty deposit schemes from the government and the new legislation surrounding them. Just talk everyone through what they are, how they work and whether they are actually worth while at the end of the day.
Mark: So, the tenancy deposit scheme was designed to safeguard a tenancy deposit. Now, just a quick point, what is classed as a deposit, obviously someone paid say £500 because that’s listed as the deposit then that’s fine. There has been a question over is rent which is paid in advance, is that classed as a deposit? If the rent paid in advance is used throughout the tenancy to pay rent then it isn’t classed as a deposit, however if it’s simply held as security, for example the rent isn’t paid then it will be classed as a deposit and a landlord has to apply with the rules of the tenancy deposit scheme. Now the rules themselves are pretty complex, they’re pretty severe for a landlord if they don’t comply with them. Now, a landlord has 30 days from the date that they receive the deposit, not the date of the start of the tenancy, the date they received the deposit in which to provide the tenant what’s known as prescribed information. Ok now, the prescribed information, it sets out things like where the deposit is held, how much is being held and how any disputes will be dealt with, how any deductions can be agreed etc. Now if a landlord doesn’t provide that information within 30 days, first of all a landlord cannot evict the tenant on what’s known as a section 21 ground which is the easiest route to get your property back, and also a landlord can be sued for the return of the deposit and three times the deposit amount. It does happen, I’ve dealt with cases where we’ve been successful suing a landlord because they haven’t complied with the rules. The rules have been in place since 2007 so this isn’t new but it’s still surprising how many landlords get it wrong and it can prove very very costly.
Alex: Absolutely yeah. And what do you do if you’re a tenant in a property and the landlord is not going to sort an issue? You often hear the boiler hasn’t been fixed for several weeks, there’s black mould here and here. What can you do from a tenant’s perspective, how can you actually get the landlord to pick up the phone and sort it out?
Mark: Yeah, you get a lot of what I call Google lawyers who will advise tenants to withhold rent and things like that. My initial advice is never withhold rent, as soon as you withhold rent as a tenant you’re automatically in breach of the tenancy agreement.
Alex: As you said you run the risk of getting kicked out of the property.
Mark: Exactly yeah. As with regards to repair, the landlord not carrying out repairs, this is quite common. This is one of the only ways you can withhold rent. If you write to your landlord and tell him that there’s a load of issues with regards to disrepair etc. and the landlord does nothing, you can serve him or provide to him estimates of the work that needs doing and the work that needs carrying out. If he still doesn’t do anything, then you have the work carried out, send the invoice to him or her, if the landlord then doesn’t pay you are then within your rights to withhold rent to the amount of the invoice. That’s the only time you could offset rent against any repairs etc. But, whilst I’ve made that sound pretty simple there is quite a rigmarole to go through to get to that point.
Alex: And would one of the deposit schemes that you mentioned, would they be able to help the tenant in that instance or not?
Mark: No because it’s not a deposit dispute, they’re only in play when you’re actually disputing how much of the deposit should be returned really. The landlords under an implied duty to keep the property in repair so if it falls into disrepair then they’re in breach on the tenancy themselves.
Alex: Fantastic. Some great top tips there actually and just dispelling I think some common myths at the end of the day. And also, what do you need to be aware of if I’m a tenant and I’m about to sign my AST, what things do I need to be mindful of?
Mark: Well first of all if you’re unsure of the terms that you’re signing up to then take advice. You don’t want to sign up to something where three months down you realise, I didn’t realise that, or I’m stuck in this etc. Other point, make sure you can afford the rent. Don’t go into a property and think well if I can’t afford it after three months I can leave. If it’s a 12-month tenancy you’re bound by the tenancy therefore your bound to pay the amount of the rent up to the end of the tenancy.
Alex: Yeah contractual law.
Mark: Yeah exactly. Make sure you’re happy with the property itself, have a good inspection of the property. You do get disputes where tenants will come along and say well there’s damp here etc. or I didn’t realise this, I didn’t realise that, all that does is cause a dispute between yourself and the landlord which again can go unresolved for some time and prove costly. So really, make sure you can afford what your going into, make sure you know what your entering into and most importantly make sure your happy with the property.
Alex: Yeah, go in with your eyes open.
Mark: Very much so yeah.
Alex: Fantastic, Mark really some fantastic tips and tricks and inside knowledge there. Obviously its very exciting about your move to Harrogate. Now if anyone on the landlord or tenant side wanted to touch base with you what are the best ways at the moment to reach you prior to the grand opening and new move?
Mark: Yeah well, they can get me on the telephone 0113 3205000 or if they want to drop me an email it’s firstname.lastname@example.org
Alex: Mark, thank you so much again and look forward to catching up soon.
Mark: My pleasure, thank you very much.
Alex: On my travels seeing new and existing clients the one thing I often come across is the lack of building regulation approval especially when it comes to converted attics, whereby homeowners who have accidentally forgotten to inform building control at the council. Now, this is all absolutely fine until you want to sell. The buyer’s solicitor is going to find out and then it opens up a can of worms. They will be unable to insure your property correctly because they can’t be certain about the structure, or indeed what has gone on behind the scenes. This will also damage your buyer’s confidence in you and the property which more often than not will lead to a fall through in the transaction. Now if you are one of the people who have forgotten about this, my advice is to first of all speak with your solicitor. The advice is often probably going to be applying for retrospective approval, this will take a bit of time to do and maybe some minor costs involved but it’s going to be well worth it. The number of times in my career where I’ve seen deals fall through right at the last hurdle because of this, never ceases to amaze me. The best advice I can give is not to do it at all.
That’s the Alex Goldstein Property show. We really have crammed in some top tips and features yet again this month. If you really want some top expert advice come to my educational talk at the property investors network in Leeds in mid-November. This is going to be to about 150 people and is the largest meeting of it’s type outside of London. Full details are on my website alexgoldstein.co.uk The next episode is out on 1 December so make sure you tune in for that. Until next time.