Boards and lodging: a high-street horror story
Send your property problems to: Property Clinic, The Daily Telegraph, 111 Buckingham Palace Road, London SW1W 0DT
POINTS OF LAW
My flat is one of 10 in a conversion of four houses in a Georgian terrace. In the three months up to Christmas, one of the flats was sold and two were let through three different agencies, which put up their boards. Then, over the next month, four more boards appeared, put up by agencies that were not involved in any business with the flats and were obviously fly-posting to get their names seen. Thus, we ended up with seven boards on our railings.
Other residents and I asked the offending agencies to remove their boards but they did not. In the end, one of our number removed them.
Is there any way that this problem can be dealt with other than through repeated, time-consuming and increasingly acrimonious calls to the offending agencies? Might it be effective if the flats’ management company wrote to all local agencies saying that all fly-posted boards will be removed? Or should we approach the contractors responsible for putting up the signs? Surely it is illegal for boards to be attached to our railings without our permission? David Fleming writes: It has been said that the purpose of a board outside a property is not to advertise the property but the agency. In recent years there have been many incidents of the sort you mention, whereby agencies have placed boards outside properties that they are not actually instructed to sell.
There are strict planning laws regulating what boards may be erected. These are contained in the Town & Country Planning Act (Control of Advertisements) Regulations 1992. The regulations say that there may be only one board per property (it is not clear whether this is per building or per flat), limit the size and state that an advertisement has to be removed 14 days after the sale is completed or a tenancy is granted. Some local authorities, particularly in London, take a strong line on these and it may be worthwhile reporting the matter to them. Theoretically, an agency that breaches the regulations could ultimately face proceedings from the Office of Fair Trading, disqualifying it from practising.
You are quite right in saying that boards tend to be erected by contractors but you should complain direct to the agency. Certainly it would be quite reasonable to tell the agency that unless the board is removed within a short space of time, you will take it down yourself, which it seems you have already done. David Fleming is head of property litigation at William Heath & Co.
My wife and I are about to exchange contracts on a small terraced property which will be occupied by our daughter and her boyfriend. To fund the purchase, we have increased the mortgage on our main residence on an interest-only basis, and will charge rent to cover the interest. We have managed to get a good, fiveyear fixed rate so that our daughter and her partner know the rent will be stable and, in a few years, may be in a position to purchase the house from us.
I contacted the Inland Revenue and was advised that we could offset the interest on the increased amount of the mortgage against the rental income, and hence not pay any tax on it. I made it clear that the mortgage was on my main residence, and not on the new property.
However, I am now worried that I have been wrongly advised. We will have a real cash-flow problem if we cannot offset. We would have to put the new house in my wife’s name to minimise tax on the rent, but this would mean that future Capital Gains Tax (CGT) would be greater, as we could use only one allowance.
Please put my mind at rest that we are allowed to offset even though the mortgage is not on the property being rented. Maggie Fleming writes: Your tax office is absolutely correct. You can deduct the interest on the part of the loan used to buy the property, provided that your rental business is being run on commercial terms. As it is being let to your daughter, you need to be careful that the expenses cannot be disallowed on the grounds that you are simply maintaining your family.
In order for the lettings to be treated as a business, you should charge a full market rent and have a normal lease in place. However, if the property is let at less than market rent, you should still be able to deduct expenses up to the amount of the rent each year – you will not be able to carry excess expenses over to a later year, however. You are aware that you will have CGT to pay on sale. Do not forget that a future sale to your daughter will be deemed to take place at market value: i.e. you will not be able to transfer the property at a lower cost in order to save CGT. Maggie Fleming is a director of Isis Financial Planners and a member of the Chartered Institute of Taxation.
Having had a property on the market for over a year with one estate agent, we decided to move our sole agency to a second company. I wrote to the first estate agency, giving two weeks’ notice as required.
Within a week of instructing the new agent, it had prepared sale details, erected a “For Sale” board and showed round a potential buyer. However, the potential buyer then saw our house’s details at the original estate agency, talked to it and said it “gave all the information required, which they were unable to get from the second agent”. We have now accepted an offer from these buyers through the first agency. Are we also liable for the second agency’s fee? Lorna Vestey writes: This is a classic example of absolutely everyone behaving improperly. Your new agency should have been helpful and informative, whereas it appears it was not. The potential buyers should have persevered with the agency that had shown them the property, your sole agent. If buyers want a different agency’s help, they should retain it to act on their behalf and pay it a fee. The disinstructed agency should neither have still been displaying your property, nor have got involved with the new agency’s buyers and are trying it on in a major way. You should not have dealt with, or considered an offer through, an agency that had not brought the buyer to the property; what were you thinking of?
Now you are faced with a mess. I believe you are bound to pay commission to the new agency because it found the buyer for the property, as instructed.
The legal position on whether fees are also due to the dis-instructed agents may depend on the wording of correspondence between you. I do not think it deserves a fee. It did not find the buyer and knew another agency was already dealing with the matter.
If things get nasty and you are determined not to pay double fees, the National Association of Estate Agents (01926 496 800) may be able to help you to resolve matters. Lorna Vestey is a former partner of a blue-chip London estate agency.
BRICKS & MORTAR
We have an oak beam over our fireplace which has been painted black. We would like to lighten it by several shades. Is there any method of doing this other than sandblasting, which would wreak havoc with our decorations and furnishings? David Snell writes: The problem with oak beams in the home that have been “painted” is knowing which paint or stain has been used in the past. It is entirely possible, of course, that several different techniques have been used over time, including the traditional one of pitch.
Strippers Paint Removers (01787 371524) has various products that are capable of removing most paints and stains. You may be asked to send in a sample of what you are trying to remove so that it can analyse it and suggest the best remedy. It is probable that you will have to make several applications but I am confident that you will achieve total success or considerable lightening. David Snell is contributing editor to ‘Homebuilding & Renovating’ magazine and author of ‘Building Your Own Home’, available at £25 plus p & p from 0870 155 7222.