What Will Homes Look Like in The Future?
Flying cars, robot butlers, and Star Trek-style transportation systems: We’ve seen some pretty wacky projections for homes of the future over the years. Realistically, the house of the future envisaged by the sci-fi fanatic was never going to happen during our lifetime. But this doesn’t mean the homes of the future we’ll be seeing soon enough won’t be impressive in their own way.
You simply have to gauge your expectations a little more realistically!
According to the pages of a new report entitled “Futurology: The New Home in 2050,” the house of the future is all about smart technology for homes. The kinds of smart homes where intelligent hardware and software make automatic decisions on things like security, heating, shopping, and so on
The smart technology homes of the future
As the world deals with a rapidly expanding and ageing population, architects expect to see growing demand for multi-generational properties to accommodate various generations in one household. This will require greater flexibility and adaptability than ever before in order to accommodate the changing needs of the property’s occupants.
Builders and architects are also already planning a future where homes capitalise on vertical space, occupying as little horizontal ground space as possible. This will enable areas of high demand to support much larger populations with the creation of compact homes with multiple stories to accommodate those within.
Technologically, we’ll undoubtedly see a continuation of the smart home trend already making its mark. Industry watchers expect to see more homes than ever before collecting and storing their own energy with renewable methods while more effectively utilising and recycling their own water supplies.
Smarter technology in general will significantly reduce the average household’s energy consumption requirements and carbon footprint. In fact, sustainability in general is expected to represent a growing area of importance for builders and developers over the years to come. Homes able to reduce their impact on the environment will potentially qualify for attractive incentives from local and national government offices.
It may also be possible for the home of the future to play a more direct role in overseeing the health and wellbeing of its occupants. Particularly where elderly residents are concerned, smart technology could be used to look for warning signs of ill-health and report directly to the relevant medical professionals. If a person were to collapse, the house itself could immediately call for an ambulance.
Smart refrigerators and storage devices are already warning households when stocks are running low and creating virtual shopping lists. Sooner or later, households will come to rely on completely automated systems that order and organise the delivery of everything they need before ever even realising they need it.
It’s also entirely likely that working from home will become an even more prominent fixture for the average household in the future. It’s already possible to communicate and collaborate with teams from any location worldwide via a basic computer and webcam. The more sophisticated computer technology and IT security become, the broader the scope for getting the job done from home.
Last but not least, the complete automation of home comfort, convenience, and entertainment systems is already happening. From window dressings to fireplaces to music systems to lighting to heating and so on, personal preferences can be met via voice assistants, facial recognition technology, and simple automated timers. Once again, the idea is that the home of the future will know what it is you want before you even realise it yourself!
Exactly how all the above affects the future of house prices remains to be seen, but it nonetheless paints a pretty impressive picture of what’s to come.
Selling a Property Through Probate? How Much Tax Do I Have to Pay?
Concerned about how to pay inheritance tax before probate? In need of advice on how to value personal property for probate? Given the importance and sensitivity of such transactions, sourcing independent expert advice should be your first port of call.
What Is a Probate Property?
Dealing with the loss of a loved one is challenging enough without the added complications of handling complex probate and inheritance tax issues. In the simplest terms, a probate property is a property an individual takes ownership of that has been named in the final will and testament of a deceased individual.
Irrespective of whether you intend to sell the property, you may be liable for probate tax, aka inheritance tax, in the United Kingdom. The importance of an accurate probate valuation of property cannot be overstated, nor can securing expert representation help relieve some burden. From obtaining a grant of privilege to dealing with all administrative and taxation requirements, it’s important to have an experienced team behind you.
Do I have to pay inheritance tax?
In England and Wales, you will be liable for an inheritance tax payment if the total estate bequeathed to you has a combined value in excess of £325,000. This is the existing inheritance tax threshold—the limitation of the inheritance you can receive without having to pay tax.
If the total value of the estate exceeds £325,000, a full 40% is payable on the amount that goes beyond this threshold.
What Does Probate Have to Do with Inheritance Tax?
When an individual receives ownership of a property through a final will and testament, they must obtain a Grant of Representation to confirm their legal ownership of and rights to the estate. In order for this to happen, the entire estate must be valued and inheritance tax obligations calculated.
The process cannot be completed until the recipient of the estate is able to prove that they have paid the inheritance tax due in full or provide formal evidence that inheritance tax is not payable. By working with an experienced and reputable probate specialist, the entire process of evaluating the property and establishing inheritance tax liability can be accelerated and simplified significantly.
A typical example
In a working example, an individual is left a property in the final will and testament of a parent. The property has a probate valuation of £475,000, which is also the maximum value the property is likely to sell for in the current market. Assuming this is the total value of the deceased individual’s estate, this amounts to £150,000 above the current inheritance tax exemption threshold.
This would mean that 40% of the £150,000 would be payable to satisfy inheritance tax requirements, amounting to a total of £60,000.
However, there are countless variables that could affect the total tax liability in both directions. From charitable contributions to capital gains tax to the type of property and its intended use, it isn’t quite as simple as establishing basic inheritance tax obligations alone.
The importance of responsible representation
The representation you secure throughout the process could have an enormous impact on the costs incurred. Avoidance of taxation isn’t an option, but there are often avenues to explore to minimise the amount of tax you’re required to pay. all while simplifying a complex legal and legislative process during an incredibly difficult time of life.
At the earliest possible stage, therefore, secure the most capable and experienced representation available. Doing so could save you time, money, and a lot of unnecessary hassle along the way.
Why are Specialist Lenders More Open to Lending Than Traditional Banks?
The last decade has seen the ‘rebirth’ of the specialist sector. The current specialist lenders are more conservative than in the past and are governed by tighter legislation, such as increased capital requirements, making them less vulnerable in the event of a downturn. There have been various reasons for this, with more customers struggling to meet the strict lending criteria of high-street banks. Specialist lenders are able to deal with more complex applications that would normally fall outside the main stream lender’s criteria, for example, someone who doesn’t have a regular stream of income, has recently moved jobs, or is purchasing a right to buy or shared ownership property.
Furthermore, self-employment and contracting are growing. Unusual income patterns have become common, such as those of freelancers or people with varying incomes, etc. Lenders who use credit scoring will often turn these clients away. Specialist lenders build themselves around specific customer groups and are therefore able to help these clients. Also, specialist lenders will help clients who have had a small blip in their credit history, which can usually be easily explained, or due to personal circumstances such as bereavement or unemployment. These individuals are not repeat offenders and have a good history before and after such an event. Unfortunately, the mainstream lender will not see it this way.
The mainstream lender has shown no interest in winning business that falls outside their automated underwriting and is designed to help the conventional borrower. This means that the margins for the specialist sector should remain higher or keep growing.
Richard Tugwell at Together says, ‘In many ways, the specialist market acts as a complement to the mainstream lenders and ensures that the customers have a choice. I think that the challenge for the specialist market is ensuring more consumers are aware of this offering, and that’s something that the lenders and brokers need to work together on.’
Specialist lending is now more regulated, and we should see less volatility than before as the focus is on affordability. This type of lending is set up to cater to complexity, not poor quality or irresponsible lending. Brokers who keep a closed mind to this sector are losing out on a big share of the growing specialist/subprime sector.
Specialised lenders are more suited to adapting to changing criteria compared to high-street lenders. Mainstream lenders take longer to change their criteria due to the legacy systems. Mainstream lenders need to adopt a manual underwriting approach instead of credit scoring. Brokers need to ask or determine what type of lender the client needs. Brokers need to do their own research to get an understanding of this market and take advantage of these opportunities so that they can help every single customer find the best solution for them, whatever their circumstances.
Research has also suggested that people are not fully aware of the options available to them. As traditionally, the market has focused on mortgages for house purchases or cash. It is important that the buyers are made aware of all the options available to them in the market so that they can make informed choices.
10 Options for Financing Your Development Project
Contrary to popular belief, the average developer doesn’t have an endless stockpile of cash just waiting to be put to use. Instead, the vast majority of property developers require financial assistance for the projects they undertake.
So it’s good news that there are so many options available to explore: Including the following 10 examples:
Conventional mortgages
First up, standard high street mortgages have the potential to be useful — assuming relatively extensive waiting periods are acceptable. Mortgages allowing large sums to be borrowed with no initial collateral be necessary.
Second charge mortgages
The difference with a second charge mortgage being that the funds are typically used to top-up existing loans. A second charge mortgage can be secured against the value of your property, even if you aren’t living in it at the time.
Commercial mortgages
As the name suggests, commercial mortgage products are designed specifically for commercial property purchases and development works in general. Similar to conventional mortgages, though exclusive to commercial borrowers and often more flexible.
Secured loans
These can be great for development finance, assuming you have the required collateral to put up. Regardless of the value of your property or assets, it is usually easy to borrow the equivalent value in the form of a loan for your project.
Buy-to-let mortgages
Another very specific type of mortgage, available exclusively for those purchasing properties to let out. Useful where available, though becoming increasingly difficult to successfully obtain.
Residential bridging loans
Residential bridging loans are typically offered in accordance with the collateral/security the borrower can provide. A fantastic and comparatively affordable option when development finance is needed quickly and can be paid back within a matter of months.
Commercial bridging loans
Pretty much the exact same concept as a residential bridging loan – large sums of money are made available for commercial purposes in a matter of days, in the form of a secured loan to repay back in full within a matter of months.
Bridge-to-let
A bridge-to-let loan is typically calculated and granted on the proviso that the borrower is able to achieve 100% rental coverage from the property itself. The exit strategy being usually to refinance using a conventional buy-to-let mortgage.
Private investment
Depending on the project in question, the developer may be able to secure the financial assistance required from private investors. Just as long as the merit and value of the project can be sufficiently verified, there are always plenty of businesses and individuals alike on the lookout for valuable property investment opportunities.
Crowdfunding
Last but not least, while it isn’t considered a ‘conventional’ approach to accessing financial assistance, crowdfunding nonetheless has huge potential. It’s simply a case of giving anyone wishing to do so the opportunity to invest in your project at a comparatively low level, in exchange for some kind of stake in its successful completion/fruition. It isn’t always easy to drum up this kind of support, but can be remarkably flexible and versatile if and when you can.
For more information on any aspect of development finance, get in touch with UK Property Finance today!
10 Things To Do To Protect Yourself Against Fraud
Everybody thinks that fraud is the kind of thing that happens to other people rather than themselves. That is, until it takes them well and truly by surprise.
On the plus side, there’s plenty we can all do to significantly reduce the likelihood of being targeted by fraudsters. Or at least, prevent significant damage from being done if you are targeted.
Here are 10 simple yet effective things to start doing right now to protect yourself:
- Identify scams
First up, it’s worth reading up on and remaining up-to-date with the latest scams. From e-mail phishing to telephone scams to various types of data theft, it’s worth checking online resources to learn exactly how to identify a scam when you see it. - Keep personal information secret.
Under no circumstances should your personal information ever be given to anyone other than yourself. Be suspicious of any ‘company’ that gets in touch with you and asks for your personal information. - Change your passwords and PINs.
Along with ensuring your passwords and PINs are as strong as possible, it’s also important to ensure that they are changed on a regular basis. Never use anything that could be easily guessed or gradually worked out. - Check out your credit report.
Check your credit report from time to time for any signs of suspicious activity. Should you come across anything suspicious, report it to the relevant authority or service provider immediately. - Shred sensitive documents.
Never make the mistake of throwing away our documents that contain any potentially sensitive personal information. Shred or burn such documents to prevent your personal data from falling into the wrong hands. - Watch for unusual activity.
It’s also important to keep an eye on things like bank statements, credit card bills, and all your online accounts in general for signs of unusual activity. Always take anything, even slightly out of the ordinary, seriously. - Share your knowledge.
Try to ensure that your friends and family members take an equally proactive approach to fraud prevention. Criminals typically have absolutely no shame when it comes to targeting those who are most vulnerable, i.e., those who do least to protect themselves. - Be suspicious of everything.
From phone calls to emails to promotional information, be suspicious of anything and everything that comes your way. Unless you are 100% convinced of the legitimacy of the communication and its source, treat it as suspicious and stay away. - Avoid public Wi-Fi.
Always remember that it only takes a matter of seconds for your device and your personal information to be hacked when using public Wi-Fi connections. which means that if you are going to use a public Wi-Fi connection, avoid accessing any of your accounts or entering any sensitive information or credentials whatsoever. - Report it
Last but not least, each and every time you come across anything that is even remotely suspicious, it needs to be reported. Even if it turns out to be nothing, it is better to be safe than sorry. The problem is that each time suspicious activity is not brought to the attention of the authorities, somebody somewhere is getting away with scamming members of the public like you.
Home Extension Finance: Explore Your Home’s Hidden Potential
For most homeowners, there’s really no easier or more affordable way of extending a property than with a professional loft conversion. Most homes have a potentially huge amount of space that could be put too much better use, without the need for major remodelling or extension works. That said, a high-quality loft conversion doesn’t come cheap, hence the importance of carefully considering all available methods of financing the development project.
The question being – which represents the best choice for you?
Get it right and a quality loft conversion can more than pay for itself. By increasing the overall value of your property by as much as 25%, a loft conversion can be one of the most outstanding long-term investments any homeowner can make. When it comes to financing these kinds of alterations, the preferred options for UK homeowners are as follows:
Re-mortgage
One readily available option for larger loans is re-mortgaging. Taken either as an extension on your current mortgage or a new mortgage if yours is already paid up, such loans can technically be offered with no upper limit. On the downside, any kind of mortgage deal can be time-consuming and difficult to organise, while at the same time being secured on your property which is used as security for the loan.
Unsecured personal loan
If the required sum comes in under £25,000, it could be easy and affordable to go with a standard personal loan. Unsecured loans are typically easy to access and carry fair interest rates, with no collateral being required. That said, qualification for personal loans of a relatively high nature can be tricky these days, as major banks and lenders continue tightening their criteria.
Bridging loans
An increasingly popular choice, bridging loans are great for those looking to borrow a moderate sum of money for a short period of time. For example, you could borrow £20,000 with a bridging loan, add £40,000 to the value of your home, sell-up as part of a planned relocation and pay back the loan within weeks or a few months. Simple, uncomplicated and fast access to the funds you need. Bridging loans are great where fast and full repayment is preferable.
Equity release
It’s also worth remembering just how much money there is tied up in the rest of the property as a whole. Equity release can typically be tailored to suit the needs of homeowners across the board, providing the perfect solution when funds are needed quickly. With equity release, there are very few qualification criteria to speak of and minimal complexities. With equity release, it’s all about the collateral.
Secured personal loan
Last but not least, a secured personal loan delivers exactly as it promises. The benefit of a secured loan being that it’s far easier to qualify for this type of financing, as credit history and current financial position etc. are not taken into account. Just as long as you have the required collateral, you can usually get a great deal.
For more information on any of our financial products or services, get in touch with the UK Property Finance customer service team today.
Turned Down For Property Development Finance?
Contrary to popular belief, being turned down for property development finance is far from uncommon. It’s just that when it happens to you personally, you feel as though you’re the only one in the world facing such troubles.
Regardless of what it is you need the capital for, there are generally four main reasons why applicants are refused assistance by any given service provider, which are as follows:
- Your credit score If your credit score simply isn’t up to par, chances are very little else will matter in the eyes of the lender.
- Your current business position You may have a fantastic credit history, but if the lender doesn’t believe that your business is currently in a suitable position to warrant the loan, you will probably be refused.
- Your Request. Alternatively, it could simply be that you have requested too much money, unacceptable repayment terms, or anything else the lender deems unsuitable.
- Your Choice of Lender or Product Lastly, it could simply be that you have made a poor choice in terms of the lender you have chosen to work with or the actual development finance package you have applied for.
So that’s the basis of the problem outlined, but what about the solution?
The good news is that no matter how many times you have been turned down, there are always alternative avenues to explore. There are certain issues that may stand in your way and make life difficult, but there is never such a thing as reaching a point where there’s nowhere left to turn.
So if you do find yourself in a situation where you have been refused financial assistance, consider the following, and you may be able to gain access to the required funding elsewhere:
- If your credit score is the problem, it isn’t a problem that is just going to go away on its own. Find out exactly what it is that is blighting your credit record and begin making the necessary changes to put it right.
- If you have only applied for generic development finance products via everyday lenders, you might want to think about the various intelligent financial solutions available. These are exactly the kinds of instances in which bridging loans, for example, have the potential to represent highly accessible, affordable, and cost-effective solutions.
- There are always alternative options to explore outside the usual borrowing spectrum. Examples include crowdfunding, peer-to-peer lending, and seeking the involvement of private investors.
- It’s also worth carefully reconsidering exactly how much you need, what you need it for, and when or how you can guarantee the sum’s full repayment. If it’s possible to get by with considerably less and pay it back quicker, you may find more lenders willing to help.
- Never overlook the possibility of obtaining a secured business loan, which, assuming you have the required collateral to put up as security, can be much easier to obtain than an unsecured loan.
- Last but not least, it’s advisable to immediately get in touch with an experienced and reputable independent broker in order to obtain professional guidance and assistance on all aspects of property development finance. Rather than repeatedly trying and failing on your own, why not get the professionals to lend a helping hand?
A great night out to see a great year out!
This year, the UK Property Finance team has nearly doubled in size. It was great for the whole team to get together to enjoy some festive spirit and laughter at this year’s Christmas party. Everyone from the team joined us, including our business development managers, processing team, internal sales, and marketing gurus. Thankfully, we know more about property finance than we do in music quizzes, as we failed miserably. Luckily, we are all still a very close team and look forward to another year in the finance sector, where we will no doubt expand further.
UK Property Finance would like to take this opportunity to wish everybody a Merry Christmas and a Happy New Year. We look forward to building new business relationships in the new year and also expanding our existing business relationships with lenders.