FAQ for Serco/Mears Property Sales
- The Advantages of Social Housing with Asylum seekers
There are many advantages when providing housing for Asylum seekers with Serco and Mears. Both of them were awarded the contract for 10 years from the Home office( Serco, Mears win £2.9 billion refugee housing contracts in Britain
). Whilst providing housing to Serco, Mears there are no voids, no management as well as maintenance is covered unless structural. ( See below for more details). There is an immense shortage of these properties whilst extremely high demand.
- How Long Has the Program been going on?
The UK Govt program for housing Asylum seekers has been active since the early 1990s (LINK)
- What is the Demand for Asylum Seekers
All one has to do is open the newspapers and read about the waves of Asylum seekers that came in 2020 via the Channel. Over 9,000 people came in. There is both legal and illegal asylum seeking. Regardless they need to be housed. More so, due to the COVID-19 Pandemic, the asylum seeker process has been far longer than the historical 5 years. Thus more people and less accommodations.
- Can I purchase a property with a mortgage?
The majority of lenders avoid providing mortgages on asylum seeker properties due to their long-term contract nature of 5 to 10 years. Therefore, we sell for cash. Refinance potentially via Together finance or Assetz depending on one’s personal situation and their preferences, however, we cannot guarantee or promise that a refinance through these entities will be provided to you since their services are independent from us.
- Who manages the properties that I am looking to acquire?
Mears PLC manages the properties in the northeast of England while Serco PLC manages the properties in the northwest of England.
- What are the management fees per month?
There are no management fees! Serco PLC and Mears PLC do not charge landlords property management fees. On-going property management is part of the contract with Serco and Mears.
- Do I have to pay maintenance fees?
Serco covers maintenance up to £5,000 per annum, not including structural issues. Serco and Mears will not contract a property with structural issues since they inspect all the properties before providing a contract. Mears does not have a limit of maintenance fees and covers all non-structural issues. Mears has a wider definition of structural issues (Majority of which we never experienced or billed): External drainage – unless drains blocked by SU, Fencing and gates, Footpaths, Roofing – including damage caused internally by roof leaks, Rendering, Boundary walls, Pointing to external walls and chimney, Rewire and electrical upgrades to make compliant, Boiler replacement, Full heating replacement, Windows, Full kitchen, Full bathroom, Damp works – excludes damp caused by condensation, Structural issues with floors, Front / back door, Gutters and downpipes, Asbestos survey, Asbestos removal, Any certification.
- Do these properties need to be refurbed?
No, these properties that are up for sale are all newly refurbed, inspected & adhering to building regs, council regulations and Serco/Mears standards.
- How long does the sale process take?
We sell with a 28 day completion time frame that includes an auction pack with electrical certificates, gas safety certificates, searches, and property condition reports from Mears or Serco.
- Can I do a survey on the property before purchase and completion?
As the tenants are asylum seekers and are considered vulnerable people that are protected by law, we sell the properties with the condition reports supplied by Serco or Mears in lieu of survey as the property must be returned in the original condition that the properties have been provided at the beginning of the contract.
- Do I have voids as the investor?
No, Serco and Mears do not have voids.
- What are the ongoing costs after I purchase a property from you?
As the landlord, you have a responsibility to be in charge of yearly insurance, yearly gas safety certificate for £60 per year, and if any potential structural issues arise. Serco or Mears will not contract or pass a property with any deemed structural issues. Properties must pass building regs as well as potentially council inspections. During the winter storms we have had roof tile slates shifted & we were liable as well as dampness emanating from the windows on a property.
- What happens on the sale date?
Upon sale, we confirm to Serco/Mears that the property has been sold. You need insurance in place before purchasing (please arrange this before completion ). You provide Serco/Mears your contact details and UK banking details. You MUST have a UK bank account open before conveyancing.
- What are the contract term durations?
Serco provides contracts with 7+3 years and Mears provides a 5-year contract.
- Can contracts be renewed at the end of the term?
We have had contracts renewed in the past with Serco from 2014 to 2019 for an additional 5 years. Then in 2020 we received the new contract of 7 years plus 3 years. There is a great need for these types of asylum seeker properties in the UK. However, we cannot guarantee nor confirm that contracts can be renewed at the end of the contract term.
- Do I need special insurance on this property?
We use Vasik as they insure Asylum seeker properties and can suggest the insurance agency we use. Insurance must be in place before conveyance of the property. Serco and Mears will not provide a contract without insurance on the property.
- Can I purchase a property in my personal name or does it have to be a company purchase?
Both a personal and company purchase are acceptable for us. This is a personal decision decided by you and/or your financial advisor. However, either purchasing entity must have a registered and active UK bank account.
- What stops the property from getting trashed?
Each property has a housing officer from Serco or Mears who is responsible for the property & tenants. The property must be returned in the original state as per the lease.
- Do you offer a sourcing service in addition to the sale service?
No, we do not provide a sourcing service since this service is very risky to a buyer. Sourcers might manage the refurb on the properties however it is not likely that they take on the full responsibility that these properties will be contracted. Unless the property that is being purchased is contracted and cash flowing, then it is highly risky for an investor to proceed onwards with a purchase from a sourcer without a contract in place already on the property.