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					If you own a one-bedroom flat in Barnet, Watford, St Albans or surrounding areas, we are interested
in acquiring a long lease. We have unmet demand for this type of property. We are also interested
in larger flats or houses. We can offer you a secure income for the period of the lease.

As a not-for-profit charitable housing association, CTHA has to charge “affordable rents”, so we
cannot lease properties at open market rates. The amount we could pay may appear at first sight to
leave a large gap compared to the amount the owner could hope to get by letting privately.

A lease to CTHA brings significant advantages, as costs such as repairs and maintenance transfer to
us, as do risks, such as void periods and legal costs.

A lease to CTHA brings guaranteed income, and the removal of all the worries that an owner may
have in renting privately.

As an example: a one-bed flat in Watford may rent privately for, say, £750 pcm. CTHA would lease
at £450 pcm. Based on our long experience as a social landlord, we can estimate that this £300 gap
is very significantly reduced by assessing the costs and risks that would transfer from the owner to
CTHA, for example:

       Vacant periods when there is no tenant and hence no income: average 10% per annum,
        equalling £75 pcm
       Repairing and redecorating: £80 pcm
       Agency fees estimated at 10%: £75 pcm
       Rent arrears: allow 5%: £37 pcm

These costs alone would fill most of the gap, accounting for £267 of the £300 difference. (The gap
might be about £100 a month if you don’t use an agency: but then you’d have advertising and other
management costs). If you allow for the possibility of a longer term void: say a 3 month vacant
period (equal to a monthly loss of £190), or the risk of legal costs to seek possession (most solicitors
today would charge about £200 per hour), then the gap potentially disappears.

Typical leases would include break clauses, and rent reviews.

Our priority is to acquire one-bed flats. However, we would remain interested in larger properties,
for which the above calculations apply proportionately.

Owners leasing to CTHA also have the reward of knowing that their property brings a social benefit,
by providing a decent and stable home to a vulnerable person.

Interested ? please e-mail or phone Dave Press, Director CTHA: dave.press@cherrytreeha.org.uk
01923 850580

				
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posted:10/1/2012
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