Articles
Ask the Residential Property Expert City & Angel Magazine, December 2010
Colman Coyle Partners, Hema Anand and Andrew Flint are the property experts for the City and Angel Magazine. Their monthly column answers reader questions on all residential property issues including buying, selling, developing or buying the leasehold of their homes.
I am buying a flat which has an extra bedroom in the loft. I have been told by the seller that he doesn't have Building Regulation approval of this work. Should I be concerned?
In this case, yes. Building Regulations are there to ensure that structural work is carried out in accordance with the prevailing regulations. As far as loft conversions are concerned, it is absolutely vital to ensure that the works incorporate adequate fireproofing and means of escape in case of fire measures. The council's general period within which it can take enforcement action is just one year and if the work in question was something more minor then you might want to take a view provided your surveyor was happy with the structural integrity of the property. However, when it comes to loft conversions, the crucial thing I think is the health and safety aspect. If a loft is being used as a bedroom, then I think issues of enforcement are almost irrelevant because the overriding factor would be the safety of the people sleeping there. I would suggest that you ask the seller to contact the council's Building Control Department and ask them to inspect the property and hopefully they will issue a Regularisation Certificate which will prove that the work has been done to the necessary standard. This will then give you the comfort that you and your solicitor will need before proceeding with the purchase.
I am splitting up with my boyfriend and we own a property jointly which has a mortgage on it. The property is going to be transferred into my sole name and a friend of mine has said that I might have to pay stamp duty on this transaction. Is this correct?
Potentially, yes. This is because the Inland Revenue treats the acquisition of debt as ‘consideration' upon which stamp duty is potentially payable. If the flat is to be transferred into your sole name subject to the existing mortgage, stamp duty will be payable if half of the current mortgage debt exceeds £125,000. Also, if you are paying your ex-boyfriend a share in the property, the Revenue will factor this into the equation too. Therefore, if you owed, for example, £200,000 on the mortgage and you were giving you ex-boyfriend £50,000, stamp duty would be payable because half of the mortgage debt is £100,000 which combined with the £50,000 gives a total of £150,000. Stamp duty begins to bite at £125,000 so on this example, it would be payable at the rate of 1%. If however you are not giving your ex-boyfriend any money for his share in the property, and your mortgage is £200,000, then stamp duty would not be payable because, half the outstanding amount falls beneath the current threshold.
Please contact Hema Anand, Enfranchisement Partner or Andrew Flint, Residential Property Partner for further information or see our enfranchisement and residential property sections.
Source: City & Angel Magazine Ask the Expert, December 2010
Authors: Hema Anand and Andrew Flint
Date published: December 2010