Archive for May 2012

The Big SHOUT

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The Big SHOUT is a chance for 300 young people in Westminster, Kensignton and Chelsea and Hammersmith and Fulham to have their say on youth services and find out about opportunities for young people in their area. The youth councils from the three boroughs are very passionate about the event and have done much of the work themselves. They have identified the key themes of the event, which they feel are important to young people: communication between the police and young people, sexual and emotional health, and opportunities for young people. The latter encompasses employment, training, volunteering and extra-curricular activities. The youth councils, supported by professionals in the field, will give workshops designed to gather young people’s feedback on these issues, how they want services to be run and what key messages services should focus on. Please see the poster below for further details.

 
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Delivering Quality Housing in the Rented Sector

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More than 1.4 million properties in the UK are funded by a Buy-to-Let (BTL) mortgage. Yet as the property markets struggles to find any pace of recovery, thousands of investors are trapped with illiquid assets. Could a simple tax change help investors ease their property woes and provide renters with better quality property?

Article first published on Conservative Home 

The housing market boom of the late 90’s and early 00’s lead investors to plough savings, speculative cash and borrowings into the property market. Over a decade buy-to-let became a household name, with daytime television and evening prime time filled with wall-to-wall programming on how to make a fortune from your personal property empire. Brits wanted to be a property owning democracy, but were no long satisfied with just one set of keys. A total of £159.4 billion is now owed on BTL mortgages (12.8% of all mortgage lending).

This new national pastime also created hundreds of thousands of first-time landlords, with just one or two properties and zero experience.

As the recession hit, many of these first-timers had their fingers burnt with tenants failing to pay rents and property price falls plunging them into negative equity. Others had substantial paper profits but no means of exiting what had for them become a headache, rather than the easy win sold to them by the wall to wall TV programmes that glossed over some of the more tedious practical aspects of owning rental properties. But no one is running for the exit, largely because they are put off by the prospect of triggering Capital Gains Tax (CGT) where the property is pregnant with gain and trying to replace their income streams from the net amount available to reinvest given the lack of return from other investment classes. A new exit route is needed.

An institution, probably a Real Estate Investment Trust (REIT) (the “New Fund”) which takes ownerships of the properties in exchange for an equivalent share holding in the fund would allow landlords to “cash in” their property investment and downsize their risk, while remaining connected to the upside of property investment.

A REIT is a company that manages a portfolio of real estate to earn profits for shareholders. REITs can be very tax efficient, as the property company pays no corporation or capital gains on the profits made from property investment.

Opening the New Fund as a vehicle for landlords to trade in small property holdings would create a large well managed group to provide a better service for both residents and an exit route for landlords – professional management, greater choice, and legislative compliance.

POLICY NEED:

Regulatory change is required to allow the rolling over of capital into the New Fund, without creating immediate CGT liability.

CGT liability remains on the whole investment gain and is rebased calculated from the property purchase price relevant to the share holding.

POLICY GAIN:

Place a requirement on the New Fund to provide a set percentage of affordable housing.

A higher percent requirement could be encouraged with a higher tax relief to deliver more affordable housing. This increases the availability of affordable accommodation and any reduced revenue to the individual investor is negated by the efficiency gains of running a larger fund.


Without loss to the Treasury, benefits are delivered across the market.

For the property owner disposing into the New Fund, the benefits are:

Exit from the headache of direct property holding, whilst maintaining the overall value from which to create their income from dividends from the New Fund.
Spreading risk, through geographical and property diversity and providing a guaranteed income
Retain connection to market upside on a ‘basket’ of properties
Elimination of personal liability of BTL mortgage


For the tenant, the benefits are:
Guaranteed quality threshold, ensuring all properties in the New Fund meet strict quality criteria.
Professional landlord service – efficient servicing, contracts and fixed point of contact.
Legislatively compliant property, e.g. gas certification, electricity installations
Improvements in property through energy efficiency and cheaper running costs - access programmes such asGreen Deal which will be very difficult in normal tenanted property.

For the New Fund, the benefits are:
Aggregation and scale from a property portfolio diversified by location and type.
Ability to transfer BTL debts into corporate borrowing, reducing rates and costs.
Guaranteed and proven source of income from a wide range of properties.
Solid asset base against which to borrow and reinvest.

For the Treasury/Government, the benefits are:
Improves the standard of rental property on the market with a quality threshold
Likely to be little/no revenue loss to the Treasury as the pregnant Capital Gains Tax would be transferred to the shareholding in the New Fund, as calculated back to the original property purchase price.
Efficient collection of taxes falling due, including CGT and income taxes
Encourages new entrants into the property market to provide for an expanded rental sector to meet demand

The promise of a fiscal wrapper for let residential property within SIPPs – made, and then rescinded on by the last Labour Government - drove behavioural change which would have provided additional properties for rent.

By accepting this simple change to allow the roll over of pregnant CGT, I believe significant numbers of poorly managed or currently void rental properties could be brought back into use and occupation. Government can provide an attractive vehicle for further investment, much of which include the provision of affordable homes for rental with the added bonus of helping get the market moving again.

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London Underground is undertaking works to upgrade the existing tube station at Bond Street.

Please see below for the latest works update for the construction of the new entrance on Marylebone Lane.

 
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Bond Street Western Ticket Hall Construction Update

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The construction of 38 diaphragm walls for the western ticket hall for new Crossrail Bond Street station since November 2011.Almost all the diaphragm walls have been completed and the last wall panel is expected to have been constructed by 21 May 2012. Please see the information sheet for more details.
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500th Tree Planted in West End

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A ceremony to mark the achievement of the 500th tree to be planted as part of the W1W Tree Initiative and the creation of the Fitzrovia Forest was marked by a ceremonial tree planting by John Simpson, veteran news reporter from the BBC and the newly appointed Lord Mayor Councillor Angela Harvey.

John expressed his pride at undertaking a tree planting which will be there to remind generations to come of the contribution that trees can make to greening and softening the urban environment.

In her first official engagement as Lord Mayor Councillor Angela Harvey, a former Chairman of the Go Green Task Force at Westminster City Council, remarked on the achievement of getting to 500 trees planted in the West End prior to the Olympics.

The work of the W1W Tree Initiative continues as does the opportunity to continue the grid of planting both in east, west and the central part of Marylebone as well as extending it through Fitzrovia to the Camden boarder.

Monies have been raised from various developments, including that of the former Middlesex Hospital, to fund this work as the planting seasons permit.

As the planting matures, as it has along Harley Street, we see the major contribution that trees can make to enhancing both the physical and the aesthetic environment, even in such tight urban spaces.


Hanover Square & Harewood Place Junction Utility Works

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Works will be being undertaken in the junction of Hanover Square and Harewood Place to replace the existing water mains in preparation for the start of tunnelling works. Please see below for more information:

 
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Park House - May Newsletter

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Please see the latest newsletter below for up to date information and images.

 
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Street Concern

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Street Concern gives members of the community, businesses, members of the public, council officials and other welfare agencies a central point of contact to report any concerns they have about people sleeping and/or living on the streets in their neighbourhood. Please see the leaflet below for further information.

 
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Block W4 Project Update: May 2012

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Please see the latest Newsletter below to see the latest news and progress.

 
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Community Event

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A Sensible Approach to Housing

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There has been much debate over the last few days on proposals by London Councils to meet their housing needs following news that LB of Newham is seeking to rent 500 properties in Stoke on Trent to house London families.

Labour has accused Westminster Council of “looking to move homeless Housing Benefit claimants 130 miles away to Derby and Nottingham” but , as ever, miss the point.

In Westminster, we have a clear policy which is driven by fairness. In line with the Government’s overall benefit cap, the amount of Housing Benefit people in the city are entitled will be limited. This is right and fair.

It cannot be right that people in work are forced to look for suitable property that is within their budget, but those who are out-of-work are given free reign of Central London with the taxpayer picking up the bill, whatever the cost as we have some of the highest rents in the country.

An absolute cap has also been introduced on weekly rent to protect taxpayers from the situation we have seen in the past where some families have been housed in properties with weekly rents in excess of £2,000 – these rents are way beyond the aspiration of many working families who do not have state support.

Under the changes weekly rent cannot exceed £250 for a one bedroom property, £290 for a two bedroom property, £340 for a three bedroom property, £400 for a four bedroom property.

We have already seen evidence that this is resulting in landlords lowering rents to meet the cap, reversing the grotesque abuse of taxpayer funds which has been exploited by some landlords and tenants who fixed high rents in order to profit from taxpayer funding.

Let me be absolutely clear, as a responsible Local Authority we are seeking solutions for housing families, many of whom have no previous or long term connection with Westminster ,who cannot find affordable accommodation in Westminster and are working with other London Councils to provide housing elsewhere in the Capital, within the HB caps, for those who need it. As one option, within a range, we had also considered allowing people who wish to do so move away from London to find a suitable property which is part of sensible contingency planning given the level of rents throughout the capital but we will not be proceeding with this at present.

Let me also be clear that if you are in City West Homes (Westminster) home you are not affected
If you are in a Housing Association home you are not affected
If you are a disabled person or there is a disabled person in the household, you are not affected.
If you are a war widow or a widower, you are not affected.

Further information on: http://www.westminster.gov.uk/services/housing/housingoptions/hphoptions/housing-benefit-changes-april-2011/


Better Off With Boris

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This Thursday voters will have the chance to decide who runs this City for the next 4 years. The most important question to answer in making that choice is who has the best plan for the jobs and growth.

We need a mayor who will fight for London. We need a Mayor who can secure the best deal for London from Central Government. We need a Mayor who will champion London as a global business capital. Most of all, we need a Mayor who will take London forward, not back.

Londoners are better off with Boris Johnson. Take one example, under Ken Livingstone and Labour council tax rose by an average of 13% a year. In total, Ken put it up 152% which cost the average London household £964. Under Boris Johnson, council tax has been frozen for 3 years and cut this year.

Boris’s 9 point plan is right for the future of this great city. Only he can deliver for the West End. He is the only candidate who will cut waste at City Hall, reduce council tax, create 200,000 new jobs, protect green space, invest in transport, cut tube delays and ensure a true Olympic legacy.

Boris’ record in office over the last four years shows that he can be trusted to deliver:

1,000 more police on the streets
24 hour Freedom Pass delivered
Got rid of the Western Extension Zone of the Congestion Charge
Banned alcohol on public transport
Put 697 uniformed officers on the buses and Tube.
Got rid of the bendy bus and introduced a new Routemaster-style bus for London, built in Britain.
Saved billions in unnecessary expense at TFL, disposed of 23 buildings and 25% of the directors.
Froze the Mayoral share of council tax for three years and cut it this year.

The choice is clear this Thursday.

Vote for the right choice for London, Boris Johnson.


Utilities Works in Gilbert Street and Weighhouse Street

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Please see the Information Sheet below for the latest utilities works taking place.

 
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