I have furnished my apartment that I am about to pass to my agent to market. Is a TV required and if I provide one will it get me more rent…?

In most cases, when an apartment is advertised fully furnished a TV is not usually expected. It is seen more of a bonus as most people have their own anyway. Depending on the property and its location a TV will sometimes help secure a tenant a little faster or may be a deal clincher as most landlords will not bother. If you are aiming at the more corporate client then their expectations are a lot higher and they will most probably ask for one as part of the deal. In these cases we can achieve slightly higher rents. It is advisable to state to your agent from the start that you are flexible and that should a prospective tenant request a TV then you are willing to provide one based on certain conditions. You could use this to negotiate a longer tenancy or slightly higher rent but be careful not to scare the tenant off. But remember, if a TV is provided and it breaks down you are obliged to fix it or provide a replacement.

Darren Shaughnessy, Director Kings Residential, Estate Agents in Manchester  and Letting Agents in Manchester writes:

I have felt for some time that discounted rate mortgages are a very bad idea. They are great for the young career couple with a clear and definite salary incease path. It helps these people onto the house ladder earlier than they might otherwise have been able to. Where a clear expectation of substantially higher income coincides with the increase in the mortgage rate they continue to be able to afford the payments albeit now probably higher than market rate but because (in this scenario) this has been a carefully considered decision, it is probably not a decision that will be regretted.

 However, for most people who’s incomes remain fairly constant increasing just modestly each year, a discounted rate mortgage can be a long-term albatross. Luckily in the UK most mortgage advisors would look at projected income levels and advise against this if it was not appropriate but in the US this has not been the case and is the root of the current sub-prime lending crisis. Mortgage brokers have targetted the poorest and most vulnerable with the promise of low payments but not really emphasised that these low payments will turn into large (unaffordable) payments in a couple of years time. To make things even worse, by allowing these products onto the mass market they have artificially fuelled the prices of houses so that when the banks do foreclose on the mortgages in huge numbers they are left with a property that is worth far less than they lent in the first place.

For some, discounted mortgages can be great, for other they are bad. But the unscupulous brokers – they are just plain evil. The lenders however have just been plain  stupid. They have not asked questions and will be carrying huge dents in the profits as a result.

Darren Shaughnessy, Director Kings Residential, Estate Agents in Manchester  and Letting Agents in Manchester writes:

 The BBC news website is running a very interesting article on the crisis in the USA.

 http://news.bbc.co.uk/1/hi/business/7070935.stm

If you take a look at this I think most people will see that something pretty extraordinary has been happening in the US. Lenders have been lending money to people who were destined to default. They simply had no hope of being able to afford these houses in the long-term once gtheir initial short-term fixed rate expired and they returned to normal rates. The extent of the problem has been so great that in some neighbourhoods 1 in 5 houses have been repossessed.

Mortgage brokers and Independant Financial Advisors in the UK have been criticised for mis-selling in the past but the market is very tightly regulated now. The US scenario just is not going to occur in the UK. However, this does not mean that it will not impact the UK. Much of the sub-prime lenders have packaged up their poor quality sub-prime debt along with some better debts and sold them on, thus reducing their exposure but increasing the exposure to the purchasers of this debt. The purchasers are all large financial institutions and are based all over the world including the UK.

We keep hearing the phrase “Credit Crunch”. This refers to the fact that many financial institutions are becoming reluctant to expose themselves to bad debt and so are becoming more careful about who they lend to. This means less credit is available and inevitably that the price of this credit will increase.

What we should not presume is that because huge numbers of repossessions are occuring in the USA that the same will happen here.

 My tenant has asked me to pay £124.99 for a BT line. Am I, as a Landlord really required to pay for the installation of a telephone line…?

This is totally at your discretion. Most short-hold tenancy agreements require the tenant to seek the landlords permission before any work is carried out on the property but I have never come across a landlord that has rejected the proposal. Some landlords offer to pay the full amount. Some offer to pay half. Unless the tenancy clearly states that you are obliged to supply a telephone line then the decision is totally up to yourself . You will probably only have to pay this charge once as it usually only applies to new properties that have yet to have a phone line activated. There is a moral argument that a landlord should pay it as the benefit remains with the property well beyond the first tenant but there is no obligation to do so. Our advice is to pay it in the interests of good relations.

Darren Shaughnessy, Director Kings Residential, Estate Agents in Manchester  and Letting Agents in Manchester writes:

Price Waterhouse Coopers, the big five Accountancy giant said today that the housing market was only marginally over-valued when compared to average earnings. In their view ”a general cooling of the market was still more likely than an outright fall in prices”. This means that fewer buyers might be looking for property but there is unlikely to be a major downward shift in prices.

I reckon PWC they have been reading my blog entry from a couple of weeks ago when I predicted the same outcome.

 http://blog.kings-residential.co.uk/2007/10/21/uk-house-market-overpriced-says-imf/

My agent mentioned a break clause. What exactly is this..?

A break clause is sometimes added to a fixed term tenancy agreement. This is usually requested by the landlord or tenant if the initial fixed term is for a year or more. A break clause will most commonly allow either the landlord or the tenant to give notice at an agreed interim stage.

For example, a 12 month tenancy may have a 6-month break clause which means that the tenant or landlord can give notice to terminate at the 6-month stage.  Notice cannot be given prior to this date nor can it be given after the break clause stage has expired. When timing the notice it is important to bear in mind how much notice is required and when this has to be served.  For example, some tenancy agreements state that one month notice must be given by the tenant to coincide with a rent due date. Notice just one day after the rent due date can equate to nearly 2 month’s notice because it is not effective until the next rent due date.  The notice for the break should be given to expire at the 6 month stage in this example.

Landlords normally must provide 2 months notice whereas tenants should provide 1 month notice.