A property snap shot
What’s new in the legal property world? The answer is quite a bit, but first, news about the market.
Things seem to be moving. I am only going on my own experience but there is an increased volume of transactions so far this year. Prices seem to have remained static though. 2013 does seem to be the year for new laws; the following is a snap shot of what is to come.
Control of Housing and Work (Jersey) Law, 2012
This law is due to come into force on 29th April. The housing law has been a feature of Island life since 1949. Older members of the community will remember when the housing department did not simply control who bought property but also what price was paid for it. The system is about to change. The new law will merge controls over occupation of property with controls over who will have the right to work in the Island. A few points of the law in relation to housing are as follows:
People who have been here for 30 years or more will become permanently qualified. Once permanently qualified a person could leave the Island for any period and not risk losing their qualifications. Other persons who have “entitled” status but are less than thirty years’ residence may leave the island for up to 5 years from the issue of their registration card without losing their rights.
All persons who are or who expect to be ordinarily resident in the island for more than three months must register regardless of what accommodation they occupy.
There is a specific provision for children being registered. The parent that (or person who has parental responsibility) shares a house with a child must register that child as soon as he or she applies for their own registration card or no later than 3 months after the child starts a period of continuous ordinary residence for three months or more.
The Housing Minister may obtain information from other States departments e.g. social security.
Those who have control of a property must notify of all occupiers of it who have been continuously ordinarily resident for three months or more.
Accommodation will be either designated as “qualified” or “registered”. Any new units of accommodation which are completed after the law comes into force will be automatically designated as “qualified”.
The Housing Minister is under a duty to maintain a register of accommodation on the island which may be inspected by the public.
Residential Tenancies (Jersey) Law, 2011
This piece of legislation has been on the statute book since 2011. It is finally due to come into force on 1st May. A summary of significant provisions is as follows:
It only applies to residential tenancies. Commercial premises are excluded as are licence agreements (for lodgers) and people who fall under the Nursing and Residential Homes (Jersey) Law, 1994.
It only applies to agreements which are commenced after 1st May or existing tenancies which are varied after this date e.g. there is a rent review.
A receipt must be given for any deposit paid and the landlord must give the tenant a copy of the signed written agreement as soon as practicable after signature.
If there is no fixed term of the lease then the tenancy may only be brought to an end after at not less than three months’ notice.
There are provisions for a rent deposit scheme (where deposits are to be held by a neutral party) but the rules for the scheme have yet to be introduced.
The Court will have clear considerations to take into account when deciding on whether a tenant should be evicted.
Security Interests (Jersey) Law, 2012
What is a “security interest” you may ask. It is the method by which somebody takes security for an obligation (usually a debt) over assets which are not land. The prime example is taking security over shares in a company – share transfer flats. Loans to buy share transfer flats are often secured on the shares which correspond to the occupation of the flat. The shares are pledged to the lender so that if there is a default on the loan, the shares are taken and sold by the lender to discharge the debt. Any balance after settlement of the debt is returned to the borrower.
This new law will not change the system of security but it will make it more flexible and sophisticated. It will also introduce a register of security taken which will be available for public inspection. A fee will be payable for making an entry onto the register which is likely to be linked to the duration of the debt. Mortgages to buy homes tend to be taken over long periods (up to 30 years) and therefore loans to buy share transfer flats are likely to face the highest registration fee. I am told that the fees will not be significant.
It may sound like hard work, and can certainly be time consuming, but it pays to thoroughly research the market for properties. There is no better feeling than believing you have got the very best property available on the market because you have thoroughly done your homework.