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Newsletter

       

January 2007 Issue

Getting Serious About Your Business Premises

The RICS has published a CD to help businesses looking to move, improve, sublet or run their premises more efficiently.  The disc includes detailed information and is an expert guide to making the most of your business premises.  Copies available from the RICS at www.rics.org.uk or visit www.propertyinbusiness.co.uk

Rating Lists 2005

Commercial Rateable Values to be used from 1st April 2005 are published on the Web at the VOA Website: www.voa.gov.uk .  You will have received your rateable value. The new Rating List has been published with effect from 1 April 2005. Council Tax bands for houses are now also listed on the website.  Contact your rating adviser if you think your rateable value is wrong.

Chairman

Brandon Simms has for some time been a valuer member of the Rent Assessment Panel.  He has now been appointed by The Lord Chancellor as a chairman.  He will be appointed to Rent Assessment Committees and Leasehold Valuation Tribunals.

Commonhold and Leasehold Reform

The Commonhold and Leasehold Reform Act 2002 has had all of its Regulations published by Statutory Instrument and all parts are now in force. In Commonhold the Act is designed to give people the opportunity to own the freehold of their homes, and have an interest in an organisation that would own and manage the common parts of the development they live in.  Most new Commonholds are likely to be new developments as all occupiers in a block have to agree to change the tenure.  Just one dissenter can stop it.

In leasehold flats and houses the Act is designed to give people reforms that make it easier to buy their freeholds, and - for those who do not want to buy - better options for managing their own homes with greater protection against abuse.  Leasehold Valuation Tribunals (LVTs) are receiving an increased number of applications particularly disputing service charges.

The residence test and other restrictions have been abolished.  Marriage value is disregarded where leases have more than 80 years to run.  If marriage value applies it will always be split 50/50.  The requirements to form Right To Manage (RTM) and Right to Enfranchise (RTE) companies are detailed in the regulations.

Caps On Again!

The Rent Acts (Maximum Fair Rent) Order 1999 introduced from 1st February 1999 a "cap" on Fair Rents based, usually, on inflation plus 5% .  If the rent has not been registered since 1999 the inflation addition is 7.5% in all other cases 5%.  Landlords who carry out expensive repairs or improvements can apply to avoid the capping but the tests are strict.

Objections to the new registrations are being heard by Rent Assessment Committees.  Even if the rent is capped an appeal will trigger a recalculation of the inflation figure based on the date of the hearing which is usually the effective date of the new rent.  In most cases this will result in a small increase in the capped rent but sometimes there is no change especially with the rate of inflation being so low.  From the tenant's point of view the 2 year cycle, when the landlord can apply to the Rent Service for another increase, is also delayed.

All Change In The Courts

The Civil Procedure Rules introduced in April 2000 following the Woolf reforms have changed the way that surveyors and the Courts interact.

A draft protocol for dilapidations has been published.  This encourages both the Landlord and the tenant to have detailed discussions before starting proceedings.  The Landlord has to justify any claim with costings and the Tenant has to provide a valuation if he wants to use the diminution of Landlords reversion argument.  The use of electronic means for producing schedules etc is being encouraged.

Special arrangements are being introduced to deal with applications under the Landlord & Tenant Act 1954 and other similar legislation e.g. Leasehold Property (Repairs) Act 1938.  When making an application for a new lease under the 1954 Landlord and Tenant Act your Chartered Surveyor will have to be ready to prepare the expert's report in a much shorter timescale.  Unfortunately the costs are still front loaded.  Instruct your expert early.   The S.25 Notice now has to include details of the terms for the new lease.   These terms have to beproper and considered.

Trained Independent Expert

Brandon Simms has been an Independent Expert for many years.  All third parties have had to be re-trained to make sure that they are up to date.  Brandon Simms has now completed his re-training by attending a course, completing an assignment and passing an interview.  He continues to be on the RICS President's panel of suitable appointees and regularly receives appointments as an Independent Expert or Arbitrator to resolve disputes, usually on rent reviews.

        1 January 2007

 

N.B. This newsletter can only give a summary of the issues discussed.  No responsibility is accepted by Brandon Simms Chartered Surveyors for any action taken based on information given here.  Professional advice should be obtained in all cases.