Gwynedd Empty Homes Initiative
Gwynedd
Empty Homes Initiative
Bring empty properties
back into use
Make your property
work for you
There is a need
to recycle homes
Gwynedd Empty Homes Initiative
MISSION STATEMENT
“Gwynedd Council will endeavour to bring
empty homes back into use. Our aims are to
contribute to the well-being of the
neighbourhood, increase the supply of housing,
reduce homelessness or the potential for
homelessness, and at the same time, reduce the
pressure on the Council’s Housing Waiting List”
1
Gwynedd Empty Homes Initiative
2
INTRODUCTION
In a society where
thousands of households
are empty and hundreds of
thousands of prospective
tenants are waiting for
rented accommodation,
empty properties, quite
simply are wasted resources. Gwynedd council believes one way of
easing the growing problem is to use and adapt what is already
available to us. Focusing on empty properties unoccupied for more
than six months the aim of the initiative is to work with not against
the owners of empty homes to encourage the reuse of their property
as quality housing accommodation. This brochure contains
information on the following:
•
Selling your property
•
Letting/Renting your property
•
Refurbishment
•
Legal enforcement measures available to the Council
This informative brochure has been produced to give practical
information and advice to empty property owners to help them bring
their property back into use.
Gwynedd Empty Homes Initiative
SELLING YOUR PROPERTY
ESTATE AGENTS
You may wish to sell the property either
privately yourself or through an estate
agent. With so many estate agents around
it can be difficult to decided which one
to choose therefore make sure you shop
around to find the right company for
you. All Estate Agents are bound by the
Estate Agents Act 1979, however by
choosing a company that is a member of
a trade organisation you will have an
indication of the standards they will follow in their work. The Royal
Institution of Chartered Surveyors (RICS) The National Association
of Estate Agents (NAEA) and The Guild of Professional Estate Agents
are trade organisations.
There is no obligation to sell when getting your property valued and it
is recommended you obtain three valuations for a balanced view. It is
also possible to contact your local land registry to get an idea of the
house prices in your area.
When selling through an estate agent you will be required to sign a
legally binding contract, ensure you read it carefully and understand it
as the terms of the contract must be adhered to and failing to do this
may result in you being taken to court for breach of contract.
Remember to ask is there is a cancellation penalty and how long the
contract will run. The contract should allow enough time to market
the property and find potential buyers. Please be aware there are
different types of agency contracts that you can enter into. These
include:
3
Gwynedd Empty Homes Initiative
4
Sole agency: One estate
agent will be responsible for
selling your home for an
agreed commission.
Joint agency: Two or more
estate agents will sell your
property and will share the
commission when the sale
goes through.
Multiple agency: An arrangement where you instruct independently
two or more agents and whoever sells the property gets the
commission.
In most cases, it is compulsory that you provide buyers with a Home
Information Pack at the point of marketing the property (even if you
choose not to use an estate agent); it allows buyers to see important
information on the property. The pack will include local searches and
other legal documentation plus an Energy Performance Certificate
(EPC).
AUCTION HOUSES
If you decide to put the property on the market, please remember it
can take anything from several weeks to several months to sell if a chain
is involved. Therefore you may wish to consider selling at auction.
Selling through an Auction house can be an extremely effective way
of disposing of property. Auctions have a targeted audience of
developers, investors, portfolio landlords and cash buyers; the fact that
a property is empty may be extremely appealing to these types of
buyers.
Gwynedd Empty Homes Initiative
A catalogue will be produced to feature
the properties to be sold at the
forthcoming auction.
Selling a property at auction has several
advantages
•
For peace of mind a reserve
price, agreed by the seller and
the auctioneer, will be set to
ensures
the
minimum
acceptable price is obtained
•
Maximum exposure of the
property
•
Quick and efficient way of selling
•
No outstanding negotiations - purchasers must bid on the day
or lose the property
•
Encourages the best offer for the property
•
Certainty of an unconditional sale:
When the hammer falls at an auction there will be an unconditional
sale creating a binding contract between buyer and seller. There will be
no chain sales to worry about, no last minute change of mind and no
arguments on the price. A percentage of the total sale price of the
property will be payable on the day with the remainder usually payable
within 28 days. This is great for those needing to release capital quickly.
•
Charges are similar to estate agents
5
6
Gwynedd Empty Homes Initiative
A well respected national auction house
has agreed special lower fees on sales of
empty properties introduced by the
council. Please contact us for more
information.
CAPITAL GAINS TAX (CGT)
CGT is a tax on capital ‘gains’. If when
you sell or give away an asset it has
increased in value, you may be taxable on
the ‘gain’ (profit). For more information
on Capital Gains Tax please visit the HM
Revenues & Customs website at www.hmrc.gov.uk. If you know which
Tax Office deals with your tax affairs, then you should contact that
office. The telephone number can be found on recent correspondence
- tax forms or letters by the tax office.
LETTING/RENTING THE PROPERTY
Letting a property could provide the owner with significant additional
income, it could also provide a much needed home. If all or part of
the property is empty, it is an asset that is being wasted. Many people
consider letting their property, but are not sure of the steps they should
take to do so.
Prior to letting your properties there are certain issues to consider, it is
important to know your rights and obligations to ensure that you let
the property effectively and avoid any problems. Previously the law
caused apprehension as to the rights of the landlord however following
changes within the law letting a property is much less complex!! The
removal of rent controls it is now possible to charge market rents and
in addition landlords now have many more rights with regard to
evicting tenants, as long as they follow certain procedure. Unless the
Gwynedd Empty Homes Initiative
7
rental income is over
£25,000 the tenancy will
automatically become an
Assured
Short
hold
Tenancy (AST) and will
usually last for 6 to 12
months.
In Wales, there is a
national
landlord
accreditation scheme which provides existing and prospective landlords
with access to training and information. Landlords must attend a
landlord development session and sign a code of conduct to become
accredited. If you require further information visit the Landlord
Accreditation website (see www.welshlandlords.org.uk) or the National
Landlords Association (see www.landlords.org.uk).
Before letting a property you may be required to contact and/or obtain
consent from:
•
Your mortgage lender
•
The Local Authority Council’s Housing Standards or
Enforcement Team. These teams ensure that privately rented
accommodation complies with the requirements of the Housing
Acts and related legislation and will give advice as to whether any
works are required to ensure compliance.
•
The Local Authority Council Tax Department
•
Your property insurance company
•
Your Tax Office or accountant
This is merely basic information for your consideration and does not
cover everything that you need to know.
Gwynedd Empty Homes Initiative
8
GWYNEDD
COUNCIL’S
PRIVATE SECTOR
LEASING SCHEME
Gwynedd Council is
seeking owners of empty
residential properties and
who are interested in
leasing them to the
council. The property should be located where there is good access to
public transport facilities and / or be within walking distance of local
services, such as schools, shops and health care facilities. The PSL
scheme is whereby Gwynedd Council leases the property for a fixed
term (initially 12 months) and then uses it as temporary
accommodation for homeless households. If you are interested in
joining the scheme, please contact us.
MANAGEMENT AGENTS
For those who are interested in renting but do not wish to become
involved in the detail of being a landlord, many estate agents offer a
letting or management service. There will usually be a one off payment
for advertising the property and where they act as a management agent
they will charge between 10-15% of the weekly rental income.
Fees will vary between agencies so ensure you shop around and you
must be clear what services you want them to provide and whether
they are able to do so, be sure to read the contract thoroughly. Please
be aware that you the owner will be responsible for insuring the
building and major repairs and maintenance.
It is recommended that you use the services of a registered agent. The
Gwynedd Empty Homes Initiative
National Approved Letting
Scheme
(NALS),
Association of Residential
Letting Agents (ARLA),
the National Association
of Estate Agents (NAEA)
and the Royal Institution
of Chartered Surveyors
(RICS)
all
trade
organisations and operate
schemes to ensure that letting agents provide professional standards of
service to both the landlord and the tenant.
A management agent may provide some of the following services:
•
Advertise the property
•
Arrange viewings
•
Collect references
•
Collection of rent
•
Dealing with repairs
•
Periodic inspections
•
Schedule of condition
•
Serving notices for the tenant to leave when necessary
•
Ensuring that the tenancy conditions are complied with
•
Arrangements of Safety Checks
If you need assistance in finding a tenant, we are able to assist you by
nominating those on the council house waiting list, please be aware
this would then be a private tenancy between you and the tenant. Please
contact us for more information.
9
Gwynedd Empty Homes Initiative
10
COUNCIL TAX
Please note Gwynedd
Council will no longer be
offering a 50% Council
tax discount on term
empty properties, which
means after 6 months of a
property being empty it
will no longer be except.
This is a liability you will
pay yourself if the property is unoccupied however if there was a tenant
in the property they would be responsible for paying the council tax
and any utility bills!! It is imperative that owners keep in touch with
the Council Tax department and inform them when a tenant is
occupying the property.
RENOVATION
If your property is in a poor state of repair there are several ways in
which you can obtain financial help to fund the renovation needed. It
may be possible for you to raise finance privately through equity release
or re-mortgaging the property.
A limited grant is available from the Council to help meet the costs of
renovation and conversion of empty properties. We are able to provide
a grant to cover 75% of renovation/conversion costs up to a maximum
of £20,000 for a house, £10,000 for a flat and £15,000 per flat
conversion. If successful in obtaining an Empty Properties Grant
certain conditions must be adhered to. The primary condition is that
the property is then let to a local tenant at a fair rent for a 5 year period.
(please see conditions at the back of the brochure).
Gwynedd Empty Homes Initiative
Please be aware that the
number of applications
exceeds the amount of
grant money available it
has
therefore
been
decided that properties
that are little more than a
shell will be treated
differently to those that
require far less work to
bring them back in to
use. A scoring matrix is used to decide which properties will benefit
from the grant. This will allow the Council to assist more owners in
bringing their vacant property back in to use.
With regard to council tax, an unoccupied and unfurnished property
which needs or is undergoing major repairs or structural alteration can
be except from paying council tax. This exemption is limited to a
maximum of 12 months. An exemption will last for 6 months after the
work is finished, but only to a maximum of 12 months exemption as
a whole. For more information on this please contact the Council’s Tax
department.
Planning permission and Building Control
If you are changing the use of your property you will need planning
permission. Restrictions may apply if the property is in a conservation
area or if it is a listed building. It is imperative that you do not
undertake work before planning permission is obtained!! Planning
permission should not be confused with Building Regulations. The
legislation concerning Building Regulations covers both the technical
standards that need to be met and the procedures that need to be
followed. It applies to all types of buildings, from new developments
to an extension or alterations to your home. It is always recommended
11
Gwynedd Empty Homes Initiative
12
that you discuss your
proposals with Building
Control before starting
any building work.
Choosing a builder
When choosing a builder
ask people you trust
(family,
friends,
neighbours and so on) if they can recommend anyone. If you cannot
find a personal contact, then use the Federation of Master Builders.
These builders follow a code of practice. You can also reduce the risk
of hiring a cowboy by using the government Trustmark scheme.
Anyone with the logo is part of the scheme (see www.trustmark.org.uk.
It is important to choose the right builder; a big problem that faces
private consumers is ‘price versus quality’. Please be cautions as the
money you think you will save by taking a cheap quote, you might
have to end up spending, often along with a lot more to get another
builder to correct the mistakes made by shoddy workmanship using
sub-standard material. You need a builder that will do a quality job at
a sensible price. Remember to get estimates from two or three different
builders and be clear about what you want done. Use a contract;
independent bodies like the JCT (see www.jctltd.co.uk) have produced
a standard contract for use between you and the builder. It sets out
clearly what’s expected of both parties, it should detail what work
should be carried out, when it is to start and finish and how much it
will cost. A reputable builder will have no qualms about using such a
document.
A good builder will:
•
Probably belong to a trade body – therefore will conform to a
code of conduct
Gwynedd Empty Homes Initiative
13
•
Have current public
liability insurance
•
Will write you an
estimate in writing
•
Will have the work
agreed in writing
•
Not ask for unusual
payment methods –
avoid dealing in cash
and agree staged or
final payment before work starts!
Do not be rushed in making a decision, it’s important to choose the
right builder!
VAT
The Government has recognized that renovations can be extremely
costly and have therefore introduced a number of tax changes which
could reduce costs and encourage bringing empty properties back into
use.
VAT can be zero rated on the sale of homes which have been empty
for 10 years or more.
It can be also reduced to 5% for refurbishment works on empty homes
where no one has lived for 2 years immediately before the work starts.
Refurbishment works include:
-
Repair
-
Maintenance e.g. redecoration
Gwynedd Empty Homes Initiative
14
-
Improvement e.g.
building
an
extension
or
installing double
glazing
-
Provision of water,
electricity
and
drainage.
The following services
must be standard VAT rated:
-
Installing non building materials e.g. carpets
-
Scaffolding
-
Landscaping
-
Professional Services e.g. architect, surveyor
-
Building control and planning consent
For both the zero and reduced rates of VAT evidence must be provided.
You could provide details from the Electoral Roll or Council Tax
records, Utility Companies, or from the Empty Homes Team..
Please note that this information is correct at the time of writing but
may change. Please contact HM Revenue and Customs or visit
www.hmrc.gov.uk for up to date information.
Gwynedd Empty Homes Initiative
15
POSSIBLE
ENFORCEMENT
PROCEDURES
As noted above there are a
wide range of services
available to help empty
property owners make the
most of their property.
However, where there are
problems bringing the properties back into use, if it is causing a
nuisance or hazard, or where the owner will not engage with the
Council constructively, the Authority as a last resort will have no option
but to look at a range of legislative options to resolve the issue.
The following are a few options available to the council:
• Enforcement action to improve the condition of the property
• Enforced sale to recover charged place on the property when the
council has had to do works in default as the owner has not
cooperated
• Compulsory Purchase Order whereby the Council has the legal
authority to purchase the property without the owners’ permission
for the benefit of the general public.
• Empty Dwelling Management Orders to take over the management
of a property
PLEASE NOTE: This guide is not exhaustive nor does it give and
authoritative interpretation of the law. If you are doubt about your
legal rights or obligations you should seek information from your local
Council Housing Advise Section, The Citizen Advise Bureau, or see a
Gwynedd Empty Homes Initiative
16
Solicitor.
Shelter Cymru supports
local authorities, their
partners, developers and
owners of empty homes to
make more effective use of
privately owned empty
homes to meet housing
need, by providing free
advice and information.
In November 2009, Shelter Cymru launched its new website which
enables you to notify your local council of empty homes in your area.
This is part of Shelter Cymru's campaign for more affordable housing.
The web site helps makes it easy for you to get empty homes in your
area back into use. You can view reports of empty homes and responses
from the Local Authority as regards to what is being done about them.
For more information please visit www.sheltercymru.org.uk or email
[email protected].
If you require any more information regarding your empty property
or to report an empty property in your area, please do not hesitate in
contacting the Empty Properties Team. We will endeavour to assist
you in any way we can.
Empty Homes Officer
Swyddfa’r Cyngor, Ffordd y Cob
Pwllheli, LL53 5AA
01758704127
Gwynedd Empty Homes Initiative
17
EMPTY DWELLING
GRANT ASSISTANCE
CONDITIONS 1. Payment
of
the
assistance is conditional
on:a) the eligible works
being executed to the
satisfaction of the
Council within 6
months of the date
hereof.
b) the production of proper invoices, demand or receipt for
payment
2. The amount of assistance may be reduced if the Council ascertain
that the aggregate of the cost of completing the works and the costs
and expenses incurred with respect to preliminary and ancillary
services and charges is or is likely to be, lower than the estimated
expense.
3. Should the property be sold after the assistance is approved, but
before the completion of the relevant work, the assistance approval
will be cancelled and the Council will demand repayment of any
monies paid to date.
4. The property should be let for a period of 5 years from the
commencement date of the first tenancy agreement. The property
should be let within 6 months of the completion date to persons
either from the Private Sector Leasing scheme or to persons from
the Council’s housing waiting list (or Gwynedd Community
Homes waiting list). Failing the above two options, the Council
may consider allowing the owner to let the property to a local family
at the local housing allowance level of rent. This should be done
in consultation and agreement with the Council.
18
Gwynedd Empty Homes Initiative
Should the property be
sold during the first year
of the condition period
then the Council will
demand full repayment.
If the property is sold
within the second year of
the condition period,
then 80% of the
assistance would be
repayable, 60% for the
third year, 40% for the fourth year and 20% for the last year.
5. The dwelling will be let or be available for letting as a residence, but
not as a holiday let, in accordance with the Private Sector Housing
Policy 2007. The landlord must provide the Council with a copy of
an acceptable Tenancy Agreement.
6. It is also a condition of the assistance that the Council may by
written notice require the owner to provide within 21 days a
statement showing how conditions 4 and 5 above are being fulfilled.
7. In the event of a breach of the assistance conditions, the Council
will demand the repayment of the assistance and reserve the right
to charge interest on the amount paid.
8. The applicant is responsible for the following:
• Asbestos survey
• Party Wall agreement
• Mortgagee consent
• Structural insurance consent
• Joint owners consent
• Compliance with Planning and Building Regulations
• Listed Building consent
• Conservation Area consent
• National Park consent
Compliance with any other relevant British Standards or regulations.