May 7, 2014 2:18 pm

House Rules: property law, HS2 and renewable heating

How to get the government to buy a property in a safeguarded area, and incentives for installing renewable heating
Illustration by James Ferguson depicting property law©James Ferguson

1. HS2 – route to riches?

I’m worried that the prospect of the HS2 rail line being built near where I live will make it hard for me to sell my house. Can I get the government to buy it from me? Quite possibly, depending on whether you are in the safeguarded area or just outside it.

What is safeguarding? And how do I know if I am in the safeguarded area? Safeguarding is the way the planning system protects land that has been earmarked for major infrastructure, to stop other proposals for the same land. The safeguarded area usually extends 60 metres either side of the proposed railway line, but do check the detailed safeguarded area maps. These can change, so a house could move into or out of the safeguarded area.

If I’m in the safeguarded area, what can I expect? As long as you are an owner-occupier, you can get the government to buy your house for its unblighted market value, under the Express Purchase scheme. You can also get reasonable moving costs and, subject to some conditions, a home loss payment of 10 per cent of value, up to a maximum of £47,000.

Does the whole property have to be in the safeguarded area? As long as any part of the house or more than 25 per cent of the whole property (including the garden and land) is within the area, you should qualify.

And what if I’m just outside? If you are within 120 metres of the centre of the proposed line, you could sell your home for unblighted market value under the newly announced Voluntary Purchase Scheme. The government is also consulting on an alternative cash payment (a tax free lump of 10 per cent of market value, up to £100,000) for those who don’t want to sell. These schemes won’t come into force until later this year.

What if I have to move and end up letting out my house? The Express and Voluntary Purchase schemes apply only to owner-occupiers. If you become a “reluctant landlord”, the “Need to Sell” scheme may help. You would have to satisfy various conditions, including showing that you bought before the current route was announced on March 11 2010, have a compelling reason to sell and have marketed your home without success for at least three months. This scheme is also open to owners of homes more than 120 metres from the proposed line.

It sounds like people on the rural part of the route could get the downside without the economic benefit. Has that been recognised? The government has just published proposals for a Home Owner Payment scheme for owner-occupiers between 120 metres and 300 metres from the proposed line in rural areas. The detail will be decided after a consultation but the initial proposal is for a lump sum from around £7,500 to £22,500, depending on how close the property is to the route.

2. The heat is on for renewables

I’ve read that the government will now pay you for installing a renewable heating system in your home. How does that work? The government has just launched the domestic Renewable Heat Incentive (RHI) scheme, a financial incentive to promote the use of renewable heat in homes. The scheme is open to owners, tenants, private and registered social landlords and even self-builders. Only housebuilders installing renewable heating systems in new-build homes are excluded.

What type of system can I install? Four types of renewable heating system are eligible: biomass boilers and biomass pellet stoves; air source heat pumps; ground source heat pumps; and solar thermal panels. You must choose a product from an approved list.

Are there any other conditions? Yes. There are a number of eligibility criteria. In particular, the system must heat only a single domestic property and the heat produced must be used only for space heating and/or hot water. It must not be used for cooking food, generating electricity or heating swimming pools.

How much money will I get? You will receive quarterly payments for seven years. Tariffs (per kilowatt hour of renewable heat) currently range from 7.3p for air source heat pumps to 19.2p for solar thermal panels. Once in the scheme, you will stay on the same tariff, with an increase in line with inflation on April 1 each year. Don’t delay in joining the scheme, though, because the government has a budget for domestic RHI and if uptake of the scheme is higher than expected, it may reduce the tariff rates paid to new applicants through a mechanism known as “degression”.

I live in an old, draughty Victorian property that needs lots of heating. Will I make a fortune? Probably not. Before you can apply, you need to get a Green Deal Assessment for your property. If the report recommends loft and cavity wall insulation, then you must install them. Other Green Deal recommendations are optional. You should also bear in mind that if you currently use mains gas for your heating, it is likely to be cheaper to continue with that than to install a renewable heating system (even taking into account the tariff payments). You are most likely to benefit from the scheme if your property is not connected to the gas grid.

Do I need to install a meter too? In most cases: no. Tariff payments will be based on estimated heat use or generation. You will need a meter if: you have a fossil fuel back-up heating system or more than one renewable space heating system; you have a biomass heating system that isn‘t designed to heat your whole property; or you occupy your property for fewer than 183 days annually.

Where can I get further information? Look at the Ofgem website.

Angus Evers is a partner in the Planning and Environment team at King & Wood Mallesons SJ Berwin

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