The perception this year has been that we are all much busier in the commercial property world – this is a relative concept, things are still tough, but the ‘Property Transaction Statistics’ from the HMRC that I came across last week do appear to support that there has been a slight increase in transaction numbers across the UK property market as a whole during the last 12 months.
This first chart indicates activity over the last 8 years in the residential and commercial property market. It shows a definite upturn this year.
The second chart shows just the commercial market – a much less obvious increase in growth – but still apparent.
As some of you who regularly read this blog may be aware, as an energy assessor I was trained by the RICS who are my professional institution. I subsequently lodged all my energy assessments under the RICS accreditation scheme – that is until they gave all their assessors one months notice of the closure of their scheme.
Well that month has now ended and I have transferred to another accreditation scheme, the transfer has been painless, but sadly that had nothing to do with the RICS who have been spectacularly absent throughout the entire episode.
At the outset I had to chase the RICS for confirmation of the scheme closure – not an auspicious start. Since then I have had one notification of a possible new scheme to join (CIBSE) from them and nothing else – no check to see if I had managed to arrange anything – nothing!
On Friday it also transpired that the scheme actually ended at 4pm – not midnight – so part way through the afternoon I found I couldn’t lodge any EPC’s – great! There was a note on the login page – but no one actually would login that way!
However, Lifespan who I use to lodge my assessments were brilliant and helped me out, also my new accreditation body – sterling – were very helpful and efficient. even CIBSE rang to check I was sorted – but not my professional body.
In an age when as Chartered Surveyors we are being asked to comply with more and more rules and regulations by the RICS it’s nice to see that they have our best interests at heart!
I am a Chartered Surveyor – and proud of it. My membership of the RICS allows me to do my job and satisfy my clients that I have the necessary knowledge and qualifications to do it properly. So why does the RICS make it so difficult for me to consider them my ‘friend’ in business?
Let me explain – a few years ago I undertook the RICS accredited Energy Assessors course to qualify as an RICS accredited energy assessor – this would allow me to prepare EPC’s for my firm and clients and then lodge them. The training was quite intensive and not cheap, but I was proud to be accredited by the RICS as they were considered to be one of the better managed schemes – so perhaps of a better quality?
So all looks rosy – until Friday when I gathered (second hand) that the RICS are going to withdraw their accreditation scheme – so I will have to register with another body. This will possibly entail doing further exams – despite being qualified already, and more importantly if I don’t act quickly, might cause a break in me being able to provide the service.
I picked the information up from an RICS forum, from other equally confused assessors. I have subsequently spoken to the RICS by telephone and they have confirmed the news, and told me the letters are in the ‘process of going out’ – have they not heard of email? I have however been told officially by the software provider I use for EPC calculations and lodgment (Lifespan) and have also received an email from an alternative accreditation scheme (Elmhurst Energy) offering a free transfer.
So why if they can all contact me so quickly and efficiently, cant the RICS (who are supposed to look after my interests for me?)
Oh, and the notice that the RICS has given its members? Five weeks (and that is for the ones that have heard officially – I still haven’t). So am I to believe that this decision was only taken a few days ago – I think not!
Now do you see my issue with the RICS?
As an energy assessor I get to inspect a large number of properties, most of which are vacant and looking to be sold or let. Consequently it is in the vendors (or Landlords) interest to ‘make the most’ of the property. Historically this has taken the form of ensuring units are cleared out, kept secure and generally ‘tarted up’ where required. If you were selling your house you would follow a similar regime to assist the sale.
There is however now another major factor that vendors and Landlords now need to consider as part of their marketing preparation, the EPC (or energy performance certificate). All commercial properties now need one if they are to be sold or let, so why don’t people take getting the best rating they can seriously?
This week I have prepared an EPC on a period office building (in Derby), nothing unusual there. But, a high proportion of the bulbs were old style tungstens (the type favoured by Daily Mail readers). As part of my report back to the client I highlighted that changing these all to CFL’s (compact fluorescents) would make a massive difference to the rating which as it stood would be an ‘F’.
This being most important due to the changes due in 2018 which would make this property unmarketable if it remained as an ‘F’. This is something that all Landlords need to consider as part of their property portfolio reviews moving forwards.
On this property the change was quite remarkable – for the cost of around 20 CFL’s (£20?) the rating moved from an ‘F’ to a ‘D’! So as far as this client is concerned the bulb change will be done, the EPC updated to a ‘D’ and the properties long term future secured.
So, in a nutshell, before you get your property assessed give some thought to the simple items you can alter like bulbs and fluorescent tubes – it may save you a lot more than just electricity in the long-term!
This is a ‘hobby horse’ of mine, as an energy assessor I am regularly the subject of my colleagues jibes about EPC’s and how they are pointless and just get in the way of doing deals. My response has always been ‘wait, they will become relevant. So get them sorted now’
The changes requiring agents to have an EPC before marketing a commercial property have made them consider them more in the past few months – and strangely has made me busier! However there is another bit of legislation due to take effect from April 2018 which will potentially have a far greater impact and is only just being taken note of by the property world;
• The Energy Act 2011 was given Royal Assent on 18 October last year
• From 18 April 2018, it will be unlawful to let any property that fails to meet a minimum energy rating
What is not clear is exactly what the minimum rating will be, it is being speculated that the minimum will be an ‘E’. This would make all ‘F’ and ‘G’ rated properties unlettable!
As a practice we have been advising our clients to be aware of this for a while, but I have recently experienced its effect for the first time from one of the main lenders – a bank taking a charge over a development of six modern units that were built prior to the requirements for EPC’s on new builds. They had no legal responsibility for getting EPC’s on the units – but it was made a condition of the loan that they were provided.
What should you do / how might it affect you?
- This could have very significant implications for landlords, and for occupiers who wish to assign or sublet space.
- Marketability of some properties would become impossible unless they were upgraded to meet the minimum standards. It is estimated that approximately 20% of non-domestic properties could be in the F & G rating brackets.
- Further clarification on the transactional trigger for minimum energy standards is awaited; however the new minimum standards could apply to all lettings and re-lettings, including sub-lettings & assignments.
- Valuations of such properties could be affected if their marketability is diminished.
- Rent reviews for properties in this situation could also be affected.
- Implications for dilapidations assessments would also exist.
Food for thought, perhaps it is time to get your properties assessed so that you can be sure that they have a long term marketability?
One of the things I love about my job is that it allows me to get out and about to meet interesting people (and not stay chained to a desk all week). Once in a while I get a day where I visit a business that makes me realise why I enjoy doing what I do so much! Every so often I get to visit small businesses that punch way above their weight – last week I had such an experience.
I was in Retford in North Notts, not a particularly industrial town, in fact quite a small market town but home it transpires to a business that supplies 90% of the UK market it is in. What do they make? Wire and traditional ropes mainly for the theatre and entertainment market. And it is in this sector that they supply 90% of the UK market they occupy!
I get to meet some amazingly interesting and successful people in my jobs and it is amazing what businesses I discover in Nottinghamshire and the surrounding area that are national or even world leaders in their market place. For example did you know that we have the only UK manufacturer of cotton wool balls in Notts?
Nine times out of ten the people running these businesses are also extremely nice people as well – another good reason for having a job that keeps me out of the office as much as it does! We are often overlooked by London and the South (they don’t get the concept of the Midlands), but we have some great businesses – think Rolls Royce, Boots, Paul Smith just to name a few of the well-known ones!
So the East Midlands has a lot going for it – don’t forget it!
I realise that I am in danger of becoming a bit of a bore here – but stay with me – the only way any firm manages to develop and improve is through feedback. This is what I am providing here for Microsoft – it’s just that it is all negative at the moment!
At work we use an online system for managing our agency instructions and other areas of our CRM. I won’t name them here because it might be considered ‘unfair’, however it is fair to say that like many of the systems that we use it relies on Internet Explorer (IE) and the dreaded Active X. This means that we can’t run it on any non IE machines (so no Macs or iOS machines). Not a great start then.
It also requires Java to run – and here we come to the reason for my rant. It won’t run on the latest version of Java – that would be far too easy – no, it requires version 6 update 21. The current version is 31 (and version 7 is in beta). So we have to stop people updating, and if they do we need to ‘roll back’ to version 21. Quite why the developers haven’t managed to update their package to use the latest Java is another story!
But ‘updating’ the Java should be easy – yes?
In any world other than Microsoft’s it is – but not with Windows – let me explain!
We have a mix of 32 bit and 64 bit machines at work – so obviously when downloading Java one should download the relevant Java for that machine? Well no! Internet Explorer has a 32 bit and a 64 bit version BUT – and this is the ‘good’ bit – IE 32 will run on a 64 bit machine, and if this is the case you need the 32 bit Java NOT the 64 bit version on a 64 bit machine – so that is nice and straightforward then!
And people wonder why I complain about Windows so much!
Now I would be the first to accept that I have the potential to be a ‘little obsessive’ when it comes to certain things – in particular I believe that expensive and relatively delicate items need to be protected and cared for by the user. By this I am referring to the likes of cameras, iPhones, iPads and similar items.
I always get a case for my iPhone as an example (I am a big fan of Noreve products) – and I am pleased to say that I have not had to replace any screens or similar on any of the iPhones I have had. However many of my work colleagues have (and it falls to me to sort them out), and it is this that forms the basis for my ‘rant’ today – for that is what this is going to be!
In fact all my tech items are always as good as new years after I get them – the first thing I got for my new iPad was a case. I don’t know if I am old-fashioned, but I believe you should look after expensive ‘toys’ and to this end I am the case manufacturers friend!
Unfortunately I do tend to find that there is not the same level of care or concern at work about the kit we use (although I would add that my colleague Tim Garratt is equally careful) and consequently I hate buying ‘quality kit’ for them to use – as they will always revert to type and damage it!
Against my better judgement I recently acquired a good quality camera for my agency colleagues to use for photos on our greatly improved property details. I ensured that a case was purchased to help protect it and then crossed my fingers – all has been well for around 6 months – until today!
The rear screen has been significantly ‘cracked’ – I am assured by the users that it was an accident (I am sure it was), and it happened in the case apparently (due to foreign bodies getting in there – a cable), but that is not the point. It is the attitude that I have issue with, the damage appears to be irrelevant to the users, and if it breaks we can buy a new one!
Am I expecting too much or do we now live in a society that really doesn’t care about things because they are so easy to replace? When I was a kid you cherished things that you purchased as you had saved hard for them – surely that is the correct attitude in relation to all things?
Rant over – for now………