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Empty Homes Advisory & Support Pack. Index 1.Introduction 2.Meet the Team 3.Meet the Team 4.Renting you Empty Property 5.Types of Tenancy 6.What kind.

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Presentation on theme: "Empty Homes Advisory & Support Pack. Index 1.Introduction 2.Meet the Team 3.Meet the Team 4.Renting you Empty Property 5.Types of Tenancy 6.What kind."— Presentation transcript:

1 Empty Homes Advisory & Support Pack

2 Index 1.Introduction 2.Meet the Team 3.Meet the Team 4.Renting you Empty Property 5.Types of Tenancy 6.What kind of Tenancy 7.Rents/Deposits 8.Housing Benefit Advice 9.Tenancy Agreements 10.Letting/Managing Agents 11.Selling your Empty Property 12.Thinking of Renting or Buying an Empty property 13.Obtaining Planning Permission 14.The Councils Enforcement Powers 15.What Enforcement Options are Available to the Council 16.Empty Property VAT Exemptions 17.How can the Local Authority Help 18.Houses into Homes interest Free Loans 19.Houses into Homes Frequently Asked Questions 20.Houses into Homes Frequently Asked Questions 21.Houses into Homes Frequently Asked Questions 22.Houses into Homes Frequently Asked Questions 23.Houses into Homes Frequently Asked Questions 24.Reduced VAT Rates for Owners/Developers Renovating an Empty Property 25.John Frances 26.Property Bay Wales 27.Property Bay Wales 28.Property Bay Wales 29.The Greed Deal 30.The Green Deal

3 Introduction Hello, I’m Glen Bowtell, Neath Port Talbot’s Empty Homes Project Officer. I work in a small team within the Environmental Health Service who monitor and regulate the condition of private sector housing within the Borough. My role includes encouraging and assisting in the return of long term empty properties back into use through various projects and involving partners, owners, agents etc, by the provision of support and advice. Empty properties have the potential to provide homes for those in greatest need, resulting in a steady income for the house owner if they choose to let. A significant return could also be realised if an owner chooses to sell. Empty properties can in some instances be vulnerable to anti-social activity, crime, vandalism, arson etc and can also have detrimental effects on neighbouring properties due to a resultant decrease in their marketable value. As the owner of an empty property there are a range of options and assistance available to you and in taking action now you could save yourself an increased financial burden and potential enforcement action in the future. We can offer support in sourcing industry professionals and in some cases can facilitate works of repair and improvement which are required, if for example, you live away from the area and find difficulty in engaging contractors, agents etc. We have built up positive working partnerships with many agencies and bodies in the Borough who share our vision. In this booklet you will find advice on: – Renting your property – Interest Free Loans (Houses to homes) Welsh Government – Selling your property – Renovating your property – Private Sector Leasing – Social Letting We hope to work with you in the near future with the common aim of turning empty Houses into Homes! Yours sincerely Glen Bowtell Empty Homes Project Officer 1

4 Meet the team Mark Thomas Team Leader Housing Enforcement Tel Rebecca Newton Environmental Health Officer Tel

5 Meet the team Natalie Blatchford Senior Enforcement Officer Tel Glen Bowtell Environmental Health Empty Homes Officer Tel

6 Renting your Empty property? Renting your empty property can be an ideal way of providing an additional income; generally to improves the standard of the property and also discourages vandalism and crime. Letting a property to another person creates a legal relationship between the landlord and the tenant. However informal you intend the arrangement to be, it is bound by specific Housing Legislation. This legislation defines both your rights and responsibilities, and those of your tenant. What do I need to provide? Anyone who decides to let their property should make sure it is clean, dry and safe. It should have an electricity supply and the plumbing and central heating checked for safety. Faulty gas appliances can be fatal and therefore the landlord has a legal obligation to maintain these and get them checked for safety on an annual basis. The kitchen should be of a reasonable standard with safe facilities for storing and preparing food. If there is a problem with poor facilities when you let, these are likely to get worse. If the property you are letting is divided into a number of separate accommodation units (such as flats, bed-sits or bed and breakfast accommodation) the property is probably a “House in Multiple Occupation” (a HMO). The Council has further requirements of the Owner or Manager of an HMO. These are legally enforceable and cover standards of fire safety and general management and upkeep of the HMO’s common parts and services. If you are contemplating letting out the property as an HMO you should see a member of the HMO team in NPTCBC Environmental Health Service. It is always best to check first to avoid problems at a later date. You have no legal requirement to provide furniture and the tenancy is not any different if the property is furnished or unfurnished. Whether or not you decide to provide furniture could be influenced by the type of letting you intend to create. People wanting to rent a whole house may have their own furniture, alternatively students and others renting bed-sits may have little of their own and therefore furnishing these properties may be appropriate. Be cautious about buying upholstered furniture and beds as all new furniture must comply with fire safety requirements. After 1st April 1996 all furniture in the property must meet these safety requirements, even second hand. Before letting your property you may be required to consult your Mortgage Lender or your Freeholder. 4

7 Types of Tenancy? All new residential tenancies let by non-resident private landlords are governed by the Housing Act There are two types: ‘Assured short hold Tenancies’ and ‘Assured Tenancies’, both of which are explained in more detail below. Although most tenancies end by agreement between the landlord and the tenant a landlord cannot evict an Assured or Assured Shorthold Tenant without first obtaining a possession order from the County Court. Whether Assured or Assured Shorthold, a tenancy is an agreement between the landlord and the tenant whereby in return for rent the tenant can live in the property as their own home. Therefore you must give at least 24 hours notice if you intend visiting the property. Shorthold Tenancy Features If you let on a Shorthold Tenancy basis, you can regain possession of your property six months after the beginning of the tenancy, provided that you give two months notice that you require possession and any fixed term has come to an end. If you think that you may need to regain possession of the property at some time, you should consider a Shorthold Tenancy. If you have a mortgage, your lender may require the tenancy to be a Shorthold Tenancy. With a limited number of exceptions, all new tenancies are automatically Shorthold, unless the landlord makes a written statement that the tenancy is to be assured. Assured Tenancy features The agreement must contain a formal notice that the landlord intends the tenancy to be assured. An Assured Tenancy will give long term rights to the tenant. If you are sure you want to let your property indefinitely, you should consider an Assured Tenancy. However it is seldom advisable for a landlord to grant an Assured Tenancy. 5

8 What kind of Tenancy? All new residential tenancies let by non-resident private landlords are governed by the Housing Act There are two types: ‘Assured short hold Tenancies’ and ‘Assured Tenancies’, both of which are explained in more detail below. Although most tenancies end by agreement between the landlord and the tenant a landlord cannot evict an Assured or Assured Shorthold Tenant without first obtaining a possession order from the County Court. Whether Assured or Assured Shorthold, a tenancy is an agreement between the landlord and the tenant whereby in return for rent the tenant can live in the property as their own home. Therefore you must give at least 24 hours notice if you intend visiting the property. Shorthold Tenancy Features If you let on a Shorthold Tenancy basis, you can regain possession of your property six months after the beginning of the tenancy, provided that you give two months notice that you require possession and any fixed term has come to an end. If you think that you may need to regain possession of the property at some time, you should consider a Shorthold Tenancy. If you have a mortgage, your lender may require the tenancy to be a Shorthold Tenancy. With a limited number of exceptions, all new tenancies are automatically Shorthold, unless the landlord makes a written statement that the tenancy is to be assured. Assured Tenancy features The agreement must contain a formal notice that the landlord intends the tenancy to be assured. An Assured Tenancy will give long term rights to the tenant. If you are sure you want to let your property indefinitely, you should consider an Assured Tenancy. However it is seldom advisable for a landlord to grant an Assured Tenancy. 6

9 Rents / Deposits For tenancies created since the Housing Act 1988 there are few restrictions on the rent a landlord can charge, however you should consider the quality of the accommodation, its size and location. Take advice from local Letting Agents and check adverts in the press for rents of similar properties in your area. If you set rent that is too high on the first term of an Assured Shorthold, the tenant can refer the rent level to the Rent Assessment Committee for a reasonable market rent to be set. Rent books and rent receipts Landlords are legally required to provide a rent book if the rent is collected on a weekly basis. The rent book is provided by the landlord, but retained by the tenant. This by law must contain certain information. You can obtain standard rent books for both Assured and Shorthold Tenancies from either law stationers or larger general stationers. Deposits: Landlords can ask the tenant to pay a deposit before moving into the property to act as security in case they leave the property owing rent or to pay for any damage or unpaid household bills at the end of the tenancy. You should state clearly in the tenancy agreement the circumstances under which part or all of the deposit may be withheld at the end of the tenancy. It is also useful to write out an inventory of furniture, kitchen equipment and other items which should be checked and agreed between you and the tenant at the outset of the tenancy. From April 2007 all tenancy deposits paid in respect of shorthold tenancies must be protected by an approved Tenancy Deposit Scheme. There are three authorised tenancy deposit schemes currently available; more information on these can be found by visiting 7

10 Housing Benefits Advice If your tenant has a low wage or is claiming benefits they can get help from the Council with all or part of the rent under the Housing Benefit Scheme. It is useful for you to check with the tenant to see if they are entitled to claim. You will need to clarify the following: – Will Housing Benefit meet the rent charged? – How long will it be before the first payment is made? – Can Housing Benefit be paid directly to you as the landlord? The Local Housing Allowance (LHA) is a flat rate allowance based on the size of the household and the area in which a person lives. The LHA sets the maximum amount of benefit a person could get and then their income and savings are taken into account in order to decide how much Housing Benefit they are entitled to. As far as landlords are concerned, the biggest change that comes with this new scheme is that normally, payment of the benefit must be made to the tenant. There are some exceptions to this rule to protect the vulnerable and to protect landlords from people who do not pay their rent. However, in the majority of cases Housing Benefit for LHA is paid directly to the tenant, not the landlord. If a tenant finds a property they like with a rent that exceeds their LHA they will need to make up the difference themselves. Fresh claims for Housing Benefit: It can take a few weeks before payment of Housing Benefit is made. In order to speed up the application the landlord can help by ensuring the following: – The tenant has completed a Housing Benefit form and given it to the Council. – The tenant has either, a rent book, tenancy agreement or clear letter setting out the terms of the agreement as proof of tenancy. – The tenant will also need to ensure they provide the Housing Benefit Office with proof of income (e.g. 5 weekly wage slips, a letter from an employer or proof of income support). For more information on this subject contact the NPTCBC Benefits Section please see 8

11 Tenancy Agreements: When you let accommodation to someone you are entering into a legal contract or agreement, even if it is not in writing. You have, in effect, contracted to provide someone with a home in exchange for money. You and your tenant may agree rent, heating, or electrical charges or just general “house rules”. No such agreement takes away your legal rights or responsibilities in the landlord/tenant relationship. Please note even if a tenant does not pay the rent you can only regain possession through the Courts. Written agreements are therefore useful as they spell out the obligations of the parties before the contract begins. Agreements should include: - – Names and address of the landlord and the tenant; – What is to be let; – The rent and how it should be paid; – Who is responsible for paying bills; – Arrangements for collection/payment of rent; – Procedures for emergencies; – General agreement for repairs – A clear means for the tenant to contact the landlord where necessary; – Any rules, for example about guests, pets, cleaning, decorating, laundry or the tenants other obligations. If you want to draw up your own agreement, get advice. If you know that you will want the property back with vacant possession in the short or medium term drawing up your own agreement is not a good idea. Assured Shorthold or Assured Tenancies, where you want to serve prior notice, are more technical than merely filling in forms and are only valid if absolutely correct. You can obtain standard tenancy agreements for both Assured and Shorthold Tenancies from either law stationers, larger general stationers or from 9

12 Letting/Managing Agents Using a Letting Agent might be a particularly good idea if the property you intend to let is far from where you live, or you are frequently away for long periods of time. What can Letting Agents do? – Find tenants; – Take up references; – Arrange Tenancy Deposits; – Prepare inventories and contracts; – Collect rents; – Deal with emergency repairs; – Monitor and chase rent arrears; – Inspect the property from time to time; – Deal with departing tenants. A landlord should be clear what service they require from a Letting Agent and make sure the Agent can and will provide these services. Choose your Agent with care. Some letting companies are members of the Association of Residential Letting Agents and some may employ staff who are qualified members of the Royal Institute of Chartered Surveyors. Reputable Agents should be able to put you in touch with existing customers. If you are going to entrust your property to an Agent, you are entitled to as much assurance as you need to help assess their level of competence. Neath Port Talbot CBC offers an accredited managing agent scheme where local letting agents agree to meet current service standards. A list of partner Agents can be found on the NPTCBC web site. If you are going to manage the property yourself you will need to consider: – Arrangements for collection/payment of rent; – Procedure for emergencies; – General agreement for repairs; – A clear means for the tenant to contact you when necessary. 10

13 Selling your Empty Property? Using an Estate Agent: Estate Agents normally charge a minimum fee or a percentage of the total sale price. This method may secure you a slightly higher price for the property but also can sometimes mean that your property is on the market for a long period of time. Selling through Auction: Estate Agents and Auctioneers in the NPT area currently charge around 2% to sell properties via auction, often having a minimum basic fee for those expected to sell at the lower end of the market. Some also charge an additional entry fee which covers the costs of producing literature, advertising and organising the auction itself. Auction is a very good way of releasing any capital you have in the property quickly. Most properties tend to sell the day of the auction and a 10% non refundable deposit is taken that day. Completion generally takes place within a month. If your property is in a particularly poor condition then this is a very good way of selling it as houses that need full renovation tend to attract a lot of interest at auction! Direct sale to Builders If you are unable to return the property to use and therefore want to sell it the Council is often approached by private investors interested in purchasing empty properties. Please contact Glen Bowtell (Empty Property Officer) on if you would like the Council to provide you with contact details for investors who have expressed an interest in purchasing property in the NPT area. Using an Agent that specifically markets empty properties: Some web based agencies specifically deal with marketing properties and plots to developers – examples of these are;- – Empro.co.uk – Propertyspy.com – Plotfinder.net 11

14 How can I trace the owner of an empty property? Neighbours or local shopkeepers may know who owns the property. This method costs nothing and can often yield valuable information. You can carry out a search through the District Land Registry for a small fee. If there has been a planning application made for the property then details of this will be lodged with the Planning Department. This information is held on the NPTCBC website How do I get a mortgage for an empty property? It can sometimes be difficult to get a mortgage for an empty property as many people need to borrow more money for the combined costs of purchase and renovation than the property is actually worth in its ruinous state. From a lender’s point of view this is high risk, because if you default on payments the property isn’t worth enough for them to recover the loan if they repossess the property. However there are some companies that do offer mortgage products particularly suited to renovating empty properties. There are some listed below: The Ecology Building Society - Buildstore - The Co-operative Bank Norwich and Peterborough Building Society. 12 Thinking of buying and renovating an empty property?

15 Obtaining Planning Permission Planning permission is required if you intend changing the use of the property i.e. from a shop to a flat/house, from a house to a number of bed-sits/flats etc. Planning Permission is also required if you intend extending the property as part of your re-development or wish to alter the property in any major way. It is always best to check with the Planning Department prior to starting work as they can offer you advice and have literature available that offers further information. Commissioning an architect or draftsman to act as your Agent will also help to ensure that you’re planning application progresses more smoothly as they will be aware of regulations and restrictions on building. Finding a reputable builder: When commissioning a builder to carry out any renovation work it’s worth while considering the following points: Paying extra for a detailed survey report as this will show you exactly what work is required to bring the property up to standard. Aim to get at least 3 quotes in writing. If possible get recommendations from friends or colleagues. This is always preferable as if they have had a good experience with a builder then the chances are you will! Ask for addresses of properties where the builder has carried out work; this way you can ‘drive-by’ these properties to view their workmanship. Make sure that you make it clear to the builder exactly what work is required, and at what stage they can expect to get interim payments and for how much. Drafting a schedule of works helps to detail exactly what work is required and to what standard. Some websites are able to recommend a reputable builder – try the Federation of Master Builders which has a link entitled “find a builder”. By inputting your postcode it lists local builders to that area that are licensed with their organisation. They can also be contacted on Tel:

16 The Council’s Enforcement Powers The Council has a number of enforcement powers to improve housing standards. Some of these relate to empty properties as well as to tenanted or owner-occupied properties. What is an Enforcement Notice? Generally, where a problem is identified a notice will be served on the owner of the property or the person responsible. Sometimes the Council has a statutory duty to serve a notice; in other cases the Council may use discretion. This notice will: – identify the problem; – stipulate works to be carried out; – Give a time limit for that work to be done. The amount of time that is given is governed by legislation and varies with each situation. When dealing with dangerous structures or properties which are open to access, immediate action may be taken. Except for these emergency situations; there is time for the person who has been served with the notice to appeal against it. If there is no appeal and the notice is not complied then the Council in some instances can arrange for the work to be done. The owner will then be recharged; with additional administration costs and may face legal proceedings. When may a notice be served? The types of situations where notices may be served include: – properties which are empty and open to access, possibly due to a break-in; – where rubbish such as household refuse, food waste, old bedding, clothes or furniture has been left causing smells or attracting flies or vermin; – properties or parts of properties which are dangerous e.g. slipped slates, badly leaning chimneys or walls; – properties which are in disrepair and are causing a nuisance or damage to neighbouring properties e.g. missing roof slates or faulty rainwater goods which allow water to penetrate into the adjacent property; – broken or insufficient drainage causing blockages, smells or rodent problems; – properties which are badly dilapidated or in a seriously ruinous condition; – properties which are in such a poor state of repair that they are unfit for habitation; – Overgrown gardens acting as harbourage for pests. – Properties adversely affecting the amenity of the area. 14

17 What Enforcement Options are Available to the Council? There are a range of options for dealing with properties which contain serious hazards. These include: – Improvement Notice; – Demolition Order; – Enforced Sale If an improvement notice is served, the notice will give details of the work required within a specified period of time, if the owner fails to carry out the works within the time specified then the council has the option to carry out the works in default and / or prosecute for breach of notice. NPTCBC has a policy of charging for improvement notices Enforced Sale? The Land and Property Act 1925 gives local authorities the power to sell properties in order to recover debts. Where work has been carried out on the property in default and the owner has subsequently failed to repay this debt enforced sale can be an option. Securing an Empty Property Empty properties can become a target for criminals, particularly in respect of theft of copper piping or cabling which can result in water damage or other disrepair problems. It is the responsibility of the owners to maintain and secure an empty property so that it is not causing nuisance to others. If the worst happens and the property is broken into, there are more permanent solutions such as boarding up the property or steel shuttering the property to prevent unauthorised access. There are various security companies who are able to assist with security solutions for long term empty properties, including interlinked alarms. We recommend that you… – Insure your property with the appropriate level of cover. – If the property is to be empty for an unknown period of time, consider turning off the water at the stop cock and draining radiators. Check first if you have a shared water supply! – Fit timer switches to lights so they come on in the evening as they would if someone was living there. – Fit a security light to dimly lit areas. – Fit good quality locks to the windows and doors. 15

18 Empty Property VAT exemptions If you are thinking of renovating an empty property to let out you may be eligible for relief on VAT. Exemptions apply in the following cases: A reduction in VAT to 5% on the cost of renovating single house dwellings that have been empty for 2 years or more: In order to claim this discount you must employ a builder that is VAT registered. This relief is known as Value Added Tax (Notice 708) - section 8. For this the builder will have to pay the full rate of VAT on materials, but would charge the house owner 5%. It is then up to the builder to re-claim the remaining 15%. It is not the case that the builder will charge 20% then say that it is up to the property owner to claim the 15% back. The builder should be familiar with the legislation and will know if the incentive applies to a project before commencing the work. Further information on this reduced rate can be found in Section 8 of Public Notice 708 – VAT: Buildings and Construction, available from the National Advice Service on or downloadable from the HMRC websiteHMRC website Zero rating the sale of renovated buildings that have not been used for residential purposes for at least 10 years. This exemption can be only be claimed once the property has been sold (i.e. this relief is not available where a property is for let). It is important to note that the developer will have to be VAT registered or register for VAT and that the property has to be sold to reclaim the VAT. If the house owner wishes to retain the property for private residential use and not sell it, they can make a claim for the VAT under the DIY Builders Refund Scheme, available from Customs and Excise. How the Schemes affects the House Owner: The main difference between the two incentives is that when the property has been empty for two years, the owner has nothing to do, simply pay a reduced VAT rate. If the property has been empty for 10 years, the house owner has to outlay the full VAT rate then claim it back. This may not fit in with the house owners’ finances. So it may be the case that the house owner prefers to pay VAT at 5% and not 0%. The two year period still applies even if the ten year period has passed. How the Schemes affect the Builder Under the 5% scheme the builder will have the additional responsibility of reclaiming the remaining VAT which they may or may not be happy with. The builder may decide that it is not worth doing the job. That is why it is important to agree this with the builder at the first point of contact. There is no benefit to the builder with the 5% scheme. The 0% scheme is aimed at the larger builder or developer, as they own the property that is the subject of the work. Therefore, they benefit fully from the incentive. 16

19 How can the Local Authority help? Key Questions: We can confirm in an official letter the duration that the property has been left empty, this can be shown to the builder if necessary and can be used as evidence to give to Customs & Excise. These letters will just confirm how long the house has been left empty and confirm which incentive applies, not that work has started or been completed. What other information will Customs accept as indicators that the building was empty? Electoral Roll, Council Tax data Information from utilities companies What do Customs mean by "empty"? No part of it the property has been lived in during the last 2 years (reduced rate) or 10 years (zero rate) Use for storage can be ignored Illegal occupation (squatters) can also be ignored Where can I get more information? Telephone the Customs and Excise National Advice Service on View the Customs and Excise website - Public Notice 708, Buildings and Constructionwww.hmrc.gov.uk Reduced rate for the installation of energy saving materials: A reduced VAT rate of 5% applies to the installation of certain specified energy saving materials in residential accommodation. This includes the installation of: – Central heating and hot water system controls; – Draught proofing; – Insulation; – Solar panels; – Wind / water turbines; – Ground source heat pumps; – Air source heat pumps; – Micro combined heat and power units; – Wood fuelled boilers; Please note that this information is correct at the time of publication. It is important that you check with HM Revenue and Customs for the up-to-date information. 17

20 Houses into Homes - Interest Free Loans A Welsh Government Scheme introduced in February 2012 offers loans available on an interest free basis – Empty Property for 6 Months + – Max £25,000 per unit (Max £150,000 per individual) – For rent - 3 year payback – For Sale – 2 year payback – LTV can’t exceed 80% of current Market Value – Secured as charge against property 18

21 Houses into Homes Frequently Asked Questions – What are Empty Property Loans? Empty Property Loans are loans being made available through the Houses into Homes Initiative to enable the renovation and improvement of single properties or the conversion of empty properties into a number of units, so that they are suitable for use as residential accommodation. – Who can apply for a loan? Individuals and companies can apply for a loan, if they already own an empty property or are considering buying an empty property in Wales. – For how long must a property have been empty before I can apply for a loan? Loans can only be made available for properties that have been empty for at least six months or more. – Does the property have to be an existing dwelling to be eligible for a loan? No. We will consider applications for loans to convert empty commercial properties into residential accommodation. However, it is very likely that you will need planning permission for the conversion and so you are strongly urged to contact the local planning department to discuss your proposals. We will only consider a loan application if the relevant planning permission has been granted WHAT FEES ARE APPLICABLE TO THE LOAN ? Loan amount Fee£0 - £50,000£295.00£50,001 - £100,000£395.00£100,001-£150,000£ From 1st April 2012 the following fees will apply: An Administration fee will be required as a contribution towards the costs of processing your application. 19

22 Houses into Homes Frequently Asked Questions Land Registry Fee The Council Legal Services are required to register a first or second charge on the property being offered as security. For loans up to £149, the fee is £50.00 per title For loans over £149, the fee is £70.00 per title In addition to the above, a Company applying for a Loan will also be required to Pay a fee of £45.00 to cover costs associated with registering the charge at Companies House. All Cheques must be made payable to Neath Port Talbot County Borough Council and submitted with application for the appropriate amount. Valuation Fee All applications must be supported by a valuation report, unless the Empty Property Officer has indicated otherwise. The valuation report must be undertaken by a member of the Royal Institute of Chartered Surveyors (RICS) on the property offered as security for the loan and should confirm current market value of the property. If the valuation relates to the property being renovated or developed then it should also confirm the potential value (on completion) and rental income (if loan to let). The cost of the valuation is payable by the applicant and no application for a loan will be processed without this document, unless the Empty Property Officer has indicated otherwise. Please note that Neath Port Talbot County Borough Council must be named as an interested party and the surveyor must note that the Council is relying on the valuation report for the purpose of the loan application. 20

23 The fee for the valuation will be dependent on the property in question and is likely to be in the region of £200-£350 + VAT at the prevailing rate. – What is the maximum amount of loan I can apply for? The maximum loan amount you can apply for is £25,000 per property or unit, up to a total maximum of £150,000, per applicant. If you are applying for a loan to convert one building into four units the maximum loan you can apply for is £100,000. If you were applying for a loan to convert a property into ten units the maximum amount of loan would be £150,000. The actual amount of loan that will be approved will be dependant on the actual cost of the works, e.g. if the works are calculated to cost £10,000 this is the most the loan will be approved for. Please note that any loan offered, taking into account any existing mortgage cannot exceed 80% of the current property value. Therefore, if you have an existing mortgage of £65,000 on a property with a current market value of £100,000, then the maximum loan that can be approved is £15,000, Current Value £100,000 Mortgage & Loan£65,000 & £15,000 = £80,000 (Maximum 80% Loan to value) It is possible in certain cases for another property to be used as security for the loan. Where the cost of the works exceed the value of the loan, then the applicant must be able to show that they have adequate funds to complete the development Houses into Homes Frequently Asked Questions 21

24 Houses into Homes Frequently Asked Questions – What do I have to do with the property or units after completion of the works? You can either let the property/units or you can sell the property/units to a new owner. Loans are not available for people wanting to renovate the property and live in it as their principal home. – Do the works/conversion have to be carried out to any sort of standards? Yes. All work must be carried out in accordance with any planning permissions or building regulation approvals made in respect of the property. Additionally the property/units must comply with the Houses into Homes Standard on completion of the works. Further details about the standard are contained available by contacting the Empty Property Officer for clarification. – Are there any conditions attached to approving the loan? Yes:- You must carry out the conversion/repair works within an agreed time period. The property/units must be marketed for sale or for let within a reasonable period of time after completing the works (12 weeks). If the property/units are available for rent and are not occupied within this time period, then the loan may become repayable. The loan must be repaid either on or before the date as specified in your Loan Facility Agreement. A financial charge will be made on the property for the lifetime of the loan. – Are the loans secured loans? Yes. – All loans approved must be secured by a first or second financial charge being secured against the property. If there is an existing mortgage on the property we will need the lenders consent to secure our charge – I am interested in applying for a loan, what do I do next? You will need to complete an enquiry form. This will ask for: - Your name, address and contact details The address of the property for which you would like to apply for a loan A brief summary of the works to be undertaken The anticipated cost of the works How many units of accommodation the conversion/renovation works will provide on completion. Whether the property/units will be sold or made available for letting on completion of the works. How the loan will be repaid. 22

25 Houses into Homes Frequently Asked Questions Please telephone your Empty Property Officer for a brief discussion, in order to establish whether we can be of assistance. – What is the interest rate for the loan? The loans are interest free, providing there is no default on the loan. Where any sum is required to be paid, but is not repaid in accordance with the loan conditions, a breach of conditions will have occurred. In such instances Neath Port Talbot County Borough Council may demand immediate repayment of the loan and interest at the national standard rate. – When will I have to repay the loan? This will depend on what you intend to do with the property on completion of the works. If you are renovating a single property, which is to be sold, the loan must be repaid when the property is sold or up to two years from the date of the loan approval, whichever is the sooner. If you are converting a property into a number of units, which are to be sold on completion of the works, it is expected that the loan must be repaid on sale of the first unit, or two years, whichever is the sooner. However we will endeavour to arrange a mutually agreeable repayment schedule. If the property/units are to be made available for letting, the loan must be repaid within 3 years from the date of the loan approval. All loans can be repaid earlier if the applicant wishes to do so. 23

26 Reduced VAT rates for owner/developers renovating an empty property In an attempt to encourage the re-occupation of empty properties the government has introduced relief on VAT. This includes:- a reduction in VAT to 5% on the cost of renovating single house dwellings that have been empty for 2 years; zero rating the sale of renovated buildings that have not been used for residential purposes for at least 10 years. Refer to the fact sheet ‘Empty Property VAT exemptions’ for further information Energy Efficiency Grants: For advice and information on Energy Efficiency Grants available to you please contact the Energy Saving Trust on or contact They can check whether you would be eligible for any grant aid e.g. for home insulation. 24

27 Bethan Edmund – Harper B.A. (Hons) MNAEA. John Francis can help with advice on Auctions, Land & New Homes, Commercial & Residential & Lettings and of course Residential Sales. We have qualified and experienced members of staff who can help establish the best way forward whether it is for individual clients or organisations. This advice is free of charge so please don’t hesitate to contact me directly if you think I can be of any assistance. Bethan Edmund – Harper B.A. (Hons) MNAEA Director

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