Lucia France: Hello, and welcome to Property Question Time, the show where you get to bombard our expert panel of property experts with all of your questions. I’m Lucia France, and joining me in the studio today we have Joanna Legget founding director of Legget Immobilier. We also have Steven Galpin property consultant extraordinaire, and joining us from Australia we have Paul Mahoney.
So first question over to you Joanna, this is from some people looking to immigrate and move around the world. So hello, we are moving from Canada to France next year, are there any specific considerations when moving to France from outside the EU, or the UK that we should know about?
Joanna Legget: Well, it will be like moving to any sort of country in Europe. You would need to … If you’re moving permanently, you would need to get a Carte Du Jour, which is like a work permit, to enable you to be able to work in the country. And to be able to get that along with a Visa, you would need to prove that you can either support yourselves if you’re not going to be working, and show that you have enough income so that you’re not relying on the State to support you. Or, you can apply for a Carte Du Jour, which is what we used to do as Brits before Europe, and they have do again after Brexit, but it’s quite a simple process. And as long as you can prove that you can support yourselves, it’s not that difficult to be able to do.
If you’re looking at not living there permanently, you are allowed to stay in France up to 182 days.
Lucia France: Oh, okay. So that’s longer than in some other countries, isn’t it?
Joanna Legget: As a Visa, yeah. If you had owned a property in France, which I’m presuming they’re looking at doing,-
Lucia France: Yes.
Joanna Legget: — you would be allowed to use it up to 182 days-
Lucia France: Okay. And would-
Joanna Legget: — as a non-resident.
Lucia France: Right, as a non-resident.
Joanna Legget: Yeah.
Lucia France: But still owning a property there, right?
Joanna Legget: Yes.
Lucia France: Okay. And is there any other things that they should think about that are going to be vastly different from the laws in Canada in terms of buying a property in France and things like that?
Joanna Legget: Well, the property process in France is quite straight forward. I’m not aware of how the process works in Canada, so I can’t quite compare to that. But in France you’d find a property that you want, you would then put in an offer, if that offer is accepted, then the vendors and the buyers put together the Comprime Du Vent, that can be done within a few days providing all the paper work is there. Then the buyers would sign first, then the vendors would sign, then a registered letter goes out to both the buyers and the sellers, and then after ten days you would need pay a deposit which is usually around 10%. And then after that, it probably takes about three months in France for it to actually complete, and that’s where all the searches are done on the property to make sure there’s nothing that’s going to affect the sale as such.
So it’s a very straight forward process. And for a buyer, you’re protected. Once the vendor has signed, and that could be after three days of receiving the offer, they can’t sell it to anyone else. They’re then tied in. If they do, they’d be liable for 10% when they go to sell it to the buyer. Whereas the buyer can put in suspensive clauses – A, they have a ten day cooling off period, but they could put in suspensive clauses like for swimming pools, or for works to be done, or change of use from an outbuilding. And providing they’re all met, then the sale would go through. But if one of them isn’t met, then they can withdraw from the sale and get their 10% deposit back.
Lucia France: Right, okay.
Joanna Legget: So it’s very, very good for the buyer. If they decided after ten days or after two months, we just don’t want to buy it, they’ll lose their deposit. So then the deposit would go back to the buyer. So there has to be a good reason why they’re pulling out.
Lucia France: Yeah. So it’s sort of in the buyer’s favor quite-
Joanna Legget: Exactly.
Lucia France: — quite a lot of the time. Right, okay. Thank you very much Joanna, thank you.
Now over to you Steven, question for you. Somebody has trees on council owned land, which have never been trimmed or lopped in 40 years, they are now 60 to 70 feet high, and if they were to come down they could cause extensive damage to my garden and buildings. I’ve reported to the council, but they say no work is needed. They’re not subject to a preservation order, and I think they’re not in a conservation area. Whilst I have had overhanging branches cut back over the years, can I have the trees reduced in height by a tree surgeon at my own expense?
Steven Galpin: Right. Simple answer that, is no you can’t. Let’s take it step by step. First of all, we’ve got these trees, they’re of a height 60 to 70 feet. The viewer is saying, “Well, if they came down they could cause extensive damage to my garden.” Unfortunately, that’s the wrong approach really. Obviously the council’s tree expert, whether that’s an in house person, possibly somebody from the park’s department, or whether it’s an outside consultant have obviously been consulted here and they say, “No, the trees are safe.” If the trees are safe, there’s very little you can do about height.
The only opportunity you may have, is the argument about right to light. But usually, there are two conditions for that. One is, that you’ll have to show that you’ve had 20 years uninterrupted light before you can run that argument, and I doubt if that’s the case. Possibly if you were there before the trees were, and again, it doesn’t sound likely that they were.
Lucia France: Right, yeah.
Steven Galpin: So, I think a right to light argument would be quite hard to run, and the finer point about that is, usually you’d have to demonstrate there are two or three trees in a line to create a serious light problem.
Right, we’ve had the trees cut back, and the branches which were interfering onto the viewers land, cut back, that’s normal, that’s quite right. You do have the right to cut overhanging branches off. You must return them to whoever owns them, so you chuck them back over the fence. That’s fairly straight forward.
I think the approach here would be, to go and see the council, not necessarily to say, “Can I have the work done even if it’s at my expense,” but offer to subsidize the council doing the work. I think there’s a subtle difference there. You’ll find that councils are fairly inflexible, because they’re a public body having to respond to rules and regulations that are pretty well set down in stone. So to take arbitrary decisions about cutting trees down because you think they might in the future be dangerous, it’s not really a runner.
But, if you were to say, “Look, I am concerned, they have got excessively high, I am prepared to underwrite the council’s cost in doing this,” I think you may found the council quite sort of cooperative. But it’s not a question of right, it’s a question of negotiation and asking for assistance really.
Lucia France: And where you’re talking about the right to light sort of argument, could you explain a little bit more about that, because they have to have been blocking their light for 20 years.
Steven Galpin: Well, essentially, whether it be a building that goes up near to your property, or fences, or whatever else, you have a right to light that lights up your property.
Lucia France: So its unobstructed light?
Steven Galpin: Unobstructed light. So therefore, if something comes along that obstruct that, you do have an argument. But you have to demonstrate that you’ve had 20 years uninterrupted use of that light.
Lucia France: Right.
Steven Galpin: So that’s quite a hard test to follow.
Lucia France: Yeah, it must be very difficult.
Steven Galpin: Especially where we’re dealing with new buildings these days, not many people have got that 20 years. And then in the case of trees, they’ll tend to look at whether there is a line of trees blocking that side. I mean, the Leyland high trees that grow very, very quickly, there are specific regulations about how they may or may not be planted, because they tend to be used to create bushes and hedges that divide borders, and they are restricted in height. But, simple trees, no.
Lucia France: And obviously here, the worry is that they could cause damage to the garden and property, if there was high winds or something like that, so is there anything they can go down that route on?
Steven Galpin: I don’t think so. I think the council’s experts will have looked at that, they’ll have done a sort of damage limitation exercise on those trees. They’ll have looked at the potential problems, they’ll have statistics about the level of wind and storms in that area. They’ll have done fairly serious calculations, and if they say it’s safe, well, I think you’re entitled to rely on that.
Lucia France: Okay, great. Thank you very much, Steven.
And then to Paul in Australia. A question for Paul is, my elderly parents really need to downsize their house to release some capital to assist with their pensions, and also to live in a more manageable property. This process will be traumatic for a number of reasons. They’re not going to handle the sale by process very well, so it would be great if there was a better way to reduce the pressure on the move. The house is worth around 285 K, and there is no mortgage. They would like to downsize to a smaller property, and it looks like something suitable could be found for around 230 K-ish. After costs that would leave a sizeable chunk of money to live on. Could a buy to let mortgage be used on their existing home to release capital to go and buy a new home? The existing house would be sold as soon as possible after they were in the new home, and I realize there would be cost incurred for closing that off. So Paul what’s your answer to that?
Paul Mahoney: Okay. There’s a couple of different options and things you could look at here. I understand the buying and selling process in the UK is a real headache. The government’s working on improving that at the moment, but that will be a slow process and who knows what the outcome of that will be. So we’ve got a property of 285,000, looking to downsize to a property of 230-odd-thousand, so you’ve got 50 … about £50,000 there depending on your parents living costs. I wouldn’t say that’s a very sizeable chunk of money, especially after costs.
So a few things you can look at, with the existing property, you could look at an equity release type product, or what’s often referred to as a reverse mortgage. Meaning that, you’re able to release equity from the property that your parents own, and they could use that to live off, or to rent elsewhere, or potentially even buy elsewhere. But, you’d need to look at what the purchase of the buy … the purchase of the property elsewhere is going to be, because for example, whether it be an equity release or whether it be as you suggest, a buy-to-let mortgage on the property they currently own, they would then need to, I assume, take a mortgage on the property they’re buying as well, which would be a residential mortgage and would be a lot more difficult to obtain then the buy-to-let mortgage.
So, some buy-to-let lenders will lend to people that are quite elderly. Some buy-to-let products will lend up to the age of 100, which surprises a lot of people. But the reason they’ll do that, is because the lender is assuming that there’s rent coming in from the property they’re lending on, and that is the serviceability for that buy-to-let product. That’s very different for a residential mortgage, where the serviceability is the actual income of the person’s living there. Now I assume from what you’ve said, your parents are elderly, and perhaps retired, perhaps they don’t have any income, or they might have a small pension, but I would be surprised if that was enough to get them a residential mortgage to then go and buy elsewhere.
They could look at something like a bridging product, which is a short term finance product, however, they are … they tend to be quite expensive. You’d be looking at the sort of range of sort of half a percent to two percent a month of the loan amount, so depending on how long it’s going to take your parents to sell their home, that could be quite a costly loan.
It seems from the situation, just on the surface, and I don’t have all the information, but it seems the idea of selling a property for 285, buying one for 230-odd, and having enough to left over to live on, is probably not something that’s really going to work, and perhaps your parents may need to reassess their options as to whether they stay in the current property, or whether the downsize property be a cheaper property to leave more of a buffer. And obviously, the more of a buffer, the more options you have, because you can look at those more costly options and they not necessarily hurt your bottom line quite as much.
As anything, generally with this show, seek professional advice. The answer I’ve just given you is based upon very limited information, so what you should do, is speak with a professional, provide them with all of the information, they can give you an idea of what the outcomes might be, what your options are, and then you can make the decision that works best for you.
Lucia France: That’s great. Thank you very much, Paul, we’ll come back to you in the second half. That’s all we’ve got time for this half. A little break, and then we’ll be back very shortly.
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Lucia France: Welcome back to Property Question Time, I’m Lucia France and I’m joined in the studio by Joanna and Steven, and from Australia by Paul.
Now I head back into our very first question to Joanna, for you. The UK is too busy and noisy for us, we want to retire somewhere peaceful in France, where should we go? And as a French property expert, this must be such a wide open question for you?
Joanna Legget: I think it is the never ending question yes, definitely. There’s lots of things to consider, for example, if they’re retiring and they want somewhere peaceful, I would also suggest you don’t stay too far away from a major city for amenities like hospitals, and things like that as well.
Lucia France: Of course.
Joanna Legget: But France is huge, and it’s the biggest country in Western Europe, so it changes depending on where you are. The things to consider would be A, the budget, because the budget changes depending on what area you’re in, and also the climates, because the climate can vary. If you want the nice heat and the mild winters, then the south of France would be a good area for you. But, the south of France … the south-west of France has also got high temperatures that reach the same as they do in the Cote D’Azure for example-
Lucia France: Right, okay.
Joanna Legget: — but a lot cheaper in prices. They have the Gulf Stream, but the winter’s can be slightly cooler there. If they’re not looking for so much heat, and they just want a nice rural location, they may want to move across to the Santruf … the center of France. Areas like Burgundy for example, which is slightly cooler than the south and the south-west. Then you’ve got the Alps, the Mountain Ranges, if they’re into walking or cycling, mountaineering, or-
Lucia France: Skiing.
Joanna Legget: — something like that, exactly, skiing, then you’ve got those areas. And they’re also very good for investment those areas, because they can rent out. If I would think from what the question is, that they are looking for countryside, so as I said earlier, I’d always sort of find your town, find your transport links that you need to get backwards and forwards from the UK to see family and friends, and then pick a nice rural area depending on your budget from there.
Lucia France: And, yeah, they do mention somewhere peaceful, so I think you’re right in terms of countryside. Is there an area where you would say is kind of up and coming for that kind of thing, or-
Joanna Legget: Well, have a lot of retirees coming to France. It’s such … It’s because of the lifestyle. The lifestyle in France is fantastic. In the countryside and rural locations, they will get that peaceful lifestyle, they’ll be part of a small community. They will need to learn a little bit of French, because most of the French don’t speak English unless you’re in major cities, and peaceful locations aren’t in major cities.
Lucia France: Yes.
Joanna Legget: But yeah, there’s lots of areas. It really is down to the budget and the climate I would say, depen … on where they should be. Brittany is a lovely area, Normandy, Parte D’Calle if they want to be quite close to the UK, all have lovely rural communities where they would find the peaceful location they’re looking for.
And the other great thing, is that it’s very little crime in the rural areas of France in the countryside, so insurances and things like that for cars and house insurance are quite cheap, which is always good for retirees.
Lucia France: And if they were … I mean they don’t actually mention it in the question here, but if they were looking for having family come out and things like that and stay with them quite often, where are you going to get the most for your money in terms of size of property?
Joanna Legget: Well, most from … Really, from Normandy all the way down the south-west to the sort of south Languedoc areas, which is in the south of France. The Languedoc you’d be looking at around 180,000 for an average house price. In the Chironceau you’d be looking at about 110, in Brittany and Normandy you’d be looking at around 120. But if you go down to the south of France, then you’re going to be looking at over 300, the same with the Rowan Alps, you’d be looking around 280 to 300.
Lucia France: Brilliant. Okay, thank you very much Joanna.
Moving on to Steven then, your next question for today. I recently left a private rental, where it was quite clear the landlord had no intention of refunding my deposit. He had no deposit protection scheme, and not earning very much, I relied on that to settle the final month’s rent. I arranged to repair some damage, and he restricted my access before my final day, and now demands retention of the deposit and more, what can I do?
Difficult situation here, right?
Steven Galpin: Well, it is, isn’t it? But, look it’s a little bit of time since I got directly involved in the rental market, but I’ll endeavor to cut through the issues here.
First of all, the first thing I’d say is that, I’m not sure what the viewer means by a private rental. I’m presuming they mean a rental in the private market, and I’m also presuming that they did this rental without the benefit of an agent being involved. However, there will have been a lease signed, and I’ve long held the view that when two people sign a lease, the best course of action is just to do what it says. You’ve signed the lease do what you’ve promised. The landlord’s signed the lease, ask him to do what he’s promised. Because in that lease I have no doubt that it will deal with the treatment, the keeping, and the protection of that deposit.
Now, many years ago when I was involved in rental, I don’t think the practice is quite so widespread now, but there used to be a clear distinction between a rental payment and a deposit payment. Usually they say, “Okay, you’ll pay one month in advance and you’ll pay a five week figure as the deposit.” And the reason for that, was that it becomes very clear what’s the deposit and what’s a rental payment.
Now, what this viewer is attempting to do, is to use that deposit as the final month’s rent. Well, I think, no. I don’t think that’s an acceptable situation. It does deny the landlord any security in terms of his dilapidations, so that’s the first point. It’s not correct to really try and do that.
It says, “I’ve arranged to repair some of the damage.” Well, first of all that damage needs to be assessed. The difference between damage and wear and tear. Wear and tear is acceptable, damage is not. Now, that again, should be undertaken by a qualified inventory clerk, who will do an inspection on the property at the last minute, prepare a schedule of dilapidations, and then that’s agreed between the tenant and the landlord, and an appropriate amount is then deducted from the final retained deposit.
Here, as I say, the tenant seems to be wanting to circumvent that by using the deposit as final rental, and as I’ve said, it’s really not acceptable.
The one fly in the ointment here, is that they’re saying that the landlord is denying them access prior to the termination of the tenancy. Well, that’s not right. They have the right to enter that property freely and without interruption until the last day, irrespective really of any dispute that they’ve got. Again, the lease will be very, very clear on that.
So, I’m afraid, this is going to just be an argument between landlord and tenant, probably of enough value to go to law about. So, as with a lot of advice that I give in these areas, it just needs good negotiating skills with the landlord, good compromise, a little bit of flexibility on both sides, and get the matter resolved.
But, word of warning to other people, this is a classic case, use a proper agent, have a proper lease, have proper arrangements, and make sure that any deposit you pay over is protected in the first place. Worrying about it a year or two years later, is not really the answer.
Lucia France: Yes. And it seems that there wasn’t a deposit protection scheme in place here, and also that kind of both parties have sort of done something that’s not quite right, as well.
Steven Galpin: Absolutely.
Lucia France: So is there any other sort of recourse, or action that the tenant could take to get a third party involved without having to go to the courts?
Steven Galpin: Well, I think the most sensible arrangement would be, as I’m sure the lease states, even if it’s a lease that’s been downloaded by the landlord from the internet, a standard sort of law society assured short hold lease, it’s going to make reference to arbitration, and it’s going to make reference to a qualified inventory clerk doing the dilapidations at the end of the tenancy, so I would remind the landlord of that. Look at that clause, see what it does say in detail, and just remind him that you’re both bound by the terms of that lease. Okay?
Lucia France: Right. Thank you very much, Steven.
Okay. And over to Paul in Australia. A question for you about renting out a flat. Hello, for a couple of years I’ve been renting out my flat on a consent to lease. Every year I have to fill out a form saying that one day I intend to move back. If I decide to no longer do this, and move to a buy-to-let mortgage, then what happens? Will I essentially be taking out an entirely new mortgage? Will I have to pay a load of fees? Are my monthly payments likely to be higher? Thanks in advance.
Paul Mahoney: Okay, good question. And so you currently on a consent to let, as you say you need to continue that. The need does need to be some sort of intent to move back at some point, and you’re renewing it every year. If you were to … Well, if you have decided that you’re not going to move back there, if you were to decide that, then yes, you’re right you’d need to move on to a buy-to-let product. Whether there’d be any fees, or whether the rates be higher associated with that change, would really depend on your current lender, and / or the product that you were to remortgage to.
For example, some lenders will make that process quite easy. They’ll allow you to switch your product over from a residential to a buy-to-let, those fees should be relatively minimal because you’re staying with that lender, but not necessarily because they are a different product.
The other option would be to, go and seek out a buy-to-let mortgage yourself, or speak with an advisor, an intermediae or your financial advisor who can arrange an alternative product for you. And again, perhaps there would be fees and increase in rates, but perhaps there wouldn’t. It really depends what your current mortgage is as well. Your current mortgage might be outdated or at a higher rate than current market, or it might be old and at a much lower rate than current market. So without knowing that information it’s hard for me to tell you whether you’re going to incur extra costs.
But of course, there will be a change. Going from a residential mortgage to a buy-to-let mortgage, they are two different products, and as I say, if you’ve decided that you’re no longer going to live there, then the right thing to do, the most correct thing to do, would be to change over to a buy-to-let product.
Without having to necessarily make that decision and incur those costs, you could go and speak with an advisor about what your options are, so that would be based upon your current financial position, the property itself, what you’re planning to do with it all, and they would come back to you with a recommendation, which would usually include all of the costs that you would incur in implementing that recommendation. Most mortgage advisors will do that free of charge, or at least give you an indication free of charge, of what your options are, so that you can make a decision on whether you actually want to make that change. So, I’d say that’s probably your best course of action.
Lucia France: Thank you very much to Paul there. Now, we’ve got a little bit of time for a golden nugget here today, and I believe Joanna has one for us, and it’s about bringing vehicles from the UK into France. So Joanna what’s your golden nugget today?
Joanna Legget: It was just a quick little tip. If you’re moving to France permanently, and you want to bring your car over, it’s pretty straight forward, but you would need to register it in France and have the number plates changed to French number plates, otherwise you can have it insured up to six months in France, but after that if it’s not on French plates, you can’t insure it in France.
However, I did find out recently that bringing a van into France is much more complicated than that, and you do need quite a lot of documents, including where it was built, et cetera, because it’s classed as a commercial vehicle.
So if you are looking at moving permanently, and you are bringing a van or a car, car’s quite straight forward, but do look into the in’s and out’s of bringing over a van.
Lucia France: Okay. And do know what the reasons are for that? Is it just because they’d rather that you bought the car, or the van rather, in France?
Joanna Legget: No, I think it’s because they class it as a commercial vehicle-
Lucia France: Right.
Joanna Legget: — so there’s lots more rules and regulations put towards it. I mean, if you’re coming … If you’ve bought a holiday home and you’re coming backwards and forwards, then your car or your van will be insured in the UK,-
Lucia France: Yes.
Joanna Legget: — so that’s not a problem at all, it’s only really for permanent residents as such.
Lucia France: Yeah, because I think it’s normally 90 days in Europe or something like that, so if it’s a holiday home it’s a different matter.
Joanna Legget: Of course, yeah.
Lucia France: But definitely if you’re looking to be a resident-
Joanna Legget: Yes, do look into the in’s and out’s of bringing commercial vehicles over.
Lucia France: Well, thank you very much, Joanna, for that fantastic golden nugget of advice there.
Thank you to Joanna Legget, Steven Galpin, also Paul Mahoney in Australia. And of course, we’ll be back again with more of your questions and answers for them from our selection of property experts. Info@propertytelevision.tv is the best way to get in touch with your questions, if you have anything you’d like to ask, and www.property-tv.co.uk is the website.
We’ll see you again next time here on Property Question Time.
Speaker 6: Property is a great investment option, but it’s one of the largest purchases that you’ll ever make. As individuals, we’re all limited by our resources, and regardless of our experience, knowledge, or time, we can achieve much more with the help of a qualified team, and extra resources being available.
Nova Financials specialize in assisting clients to achieve financial freedom through property investment. With over 100 years of experience, we shape your family’s future.
To invest in property with absolute confidence, call on 0203 8000 600, or visit nova.financial.