House prices rose 7.3% this year, average now almost £250k

[FoxEye]

No that's pretty much what i meant, and if you had the power to make laws, you would make the situation even worse than it is, and 15 years later, there would be a foxeye 2.0 on another forum, saying the exact thing you are saying right now.

I don't think I could make it worse, if I tried.

Things are going to get worse, by the looks of things, regardless. The only action the govt will take is to endlessly prop up the housing market. House prices will continue to grow way in excess of earnings growth.

More and more people will be unable to save a deposit, or get a mortgage.

It's going to be fun times ahead.

 

[Psycho Sonny]

You’ve got a crapper there!

Interest only mortgage on a £300k house is what, £300/month?

so you would need to be renting it out at about £500/month for a 300k house... no if that is the case, you have a lemon.

Please point me where I can get a BTL mortgage interest rate of 1%

I can't even get that rate for my home and I'm in the best bracket for LTV.

 

[Psycho Sonny]

Are you salty because you aren't earning enough, or that you haven't saved anything? Feels like you just keep making excuses for yourself.

He lives with his parents.

He's an old man.

He's had 20 years to save up money and flats are available within driving distance from £50k to £125k. Some yeah go up to £300k for beachfront but I don't think that's essential but he does.

 

[stuman]

Please point me where I can get a BTL mortgage interest rate of 1%

I can't even get that rate for my home and I'm in the best bracket for LTV.

either way you cut it though:

make money, pay off the mortgage gain asset.

or

don’t make money.....for what? You are then literally paying the bank to shank somebody?

ok so if you got a 2% that’s 600 plus tax, so 800/m generally you would be asking £1000 a month in rent for that. So 20p/m equity. I’ve also seen mortgages offered for remortgage at 1.6 recently.

but again, if you’re not making money, then why?

 

[Deleted User 298457]

He lives with his parents.

He's an old man.

He's had 20 years to save up money and flats are available within driving distance from £50k to £125k. Some yeah go up to £300k for beachfront but I don't think that's essential but he does.

Ahh I see. So I was right in saying he is old but I assumed because he lived at home he wasn't that old.

Makes sense. The world is the problem, not his own failings.

 

[Semple]

I think you guys need to realise the government HAVE made significant changes to discourage it.

I don’t think that is settling in though? You seem to still think it’s a gold mine. Anyway let’s see what happens to prices. after this stamp duty ends (likely to extend) and any landlords like me who find it too much faff dump property. ( and pay the government their share via CGT)

I think the issue is that the damage has already been done, and it'll likely still take a good 5-10 years before a number of landlords decide what they're making back from it isn't worth the hassle.

It only takes one bad tenant to stop paying, and cause serious amounts of damage for the landlord to be well out of pocket. Especially if these "no benefit applicants" start getting clamped down on.

 

[Psycho Sonny]

either way you cut it though:

make money, pay off the mortgage gain asset.

or

don’t make money.....for what? You are then literally paying the bank to shank somebody?

ok so if you got a 2% that’s 600 plus tax, so 800/m generally you would be asking £1000 a month in rent for that. So 20p/m equity. I’ve also seen mortgages offered for remortgage at 1.6 recently.

but again, if you’re not making money, then why?

You have seen normal mortgages yes?

I'm going to let you in on an industry secret.

Buy to let rates are higher.

Who would have thunk it?

Please stop picking numbers out of thin air. It's making your argument look terrible.

 

[FoxEye]

Won't somebody think of the poor landlords, it's so hard to make a profit.

Yet oddly for something that's not at all profitable, houses keep being bought up for their rental value.

And sites like RightMove et al continue to highlight the rental value of each property they list..

Which is really weird for something that's completely not profitable Must be doing it for a hobby, right?

 

[stuman]

You have seen normal mortgages yes?

I'm going to let you in on an industry secret.

Buy to let rates are higher.

Who would have thunk it?

Please stop picking numbers out of thin air. It's making your argument look terrible.

so are you making money or not? The numbers either way point to the same thing

you are making money from it, gaining financial reward for making it difficult for average joe to get a house.

or,

you are not making money and not only making it hard for average joe, but also doing yourself an injustice.

 

[FoxEye]

so are you making money or not? The numbers either way point to the same thing

you are making money from it, gaining financial reward for making it difficult for average joe to get a house.

or,

you are not making money and not only making it hard for average joe, but also doing yourself an injustice.

I suspect it's "not profitable" because they consider the mortgage a "cost" in their rationalisation.

So having somebody pay off the mortgage & also a bit more for maintenance/wear & tear (because unlike home owners, BTL don't feel they should pay to maintain their properties - the tenant should), isn't quite good enough, because then they're "only" benefitting from the appreciation of the value of the property itself.

Which is "only" vastly outpacing most stocks, shares, etc, in its growth.

 

[Nitefly]

The housing market is utterly, utterly bonkers. Pretty much impossible for any person on an average salary to stand a chance whilst renting. Unless you want to scrimp to get something absolute ****balls.

Not sure how I feel about buy to let. On one hand, I morally oppose it (in the sense that I would just be investing money rather than ‘doing up’ or adding value - adversely affecting the market), on the other, it’s a sensible investment.

Feels like it needs more regulation to me.

 

[platinum87]

I have huge problems in understanding social things, but from this thread, the stock market thread, and other similar topics, everyone seems to have an equally bad understanding of economics.

Feels like it needs more regulation to me.

Never expected from someone with a geography degree tbh

 

[stuman]

I have huge problems in understanding social things, but from this thread, the stock market thread, and other similar topics, everyone seems to have an equally bad understanding of economics.



Never expected from someone with a geography degree tbh

oh wise one, please endow us with your wealth of understanding and let us know the the perfect solution...

 

[Psycho Sonny]

so are you making money or not? The numbers either way point to the same thing

you are making money from it, gaining financial reward for making it difficult for average joe to get a house.

or,

you are not making money and not only making it hard for average joe, but also doing yourself an injustice.

Making money and making profit are 2 completely different things.

I suspect that you are referring to profit rather than money here?

All rental income is taxable minus a few expenses. Of which mortgage isn't one of them. That means if someone pays you £900 that doesn't mean you have £900 to spend far from it.

So let's say you have £900 coming in. The mortgage is £600. You have expenses of £300. Agents take 12-15% as an example so half of that £300 is going to them and the other half is going on fees, repairs, certificates, insurance, etc.

Your actually making a loss as in your having to pay towards the mortgage yourself once you account for tax.

Which is why Simon has an interest only mortgage so he doesn't have the additional burden of paying the loan back just the interest in the hope equity increases.

Again foxeye has no clue how taxation works. He wants more tax to be paid when it's already ridiculously high.

Pointless debate as he literally doesn't have a clue how much tax is being paid.

As for property vastly outgrowing shares and stocks that's hilarious. House prices have decreased in some areas some which have lost a quarter of their value.

If house prices only ever went up and faster than stocks and shares nobody would buy stocks and shares.

Complete fantasy world.

 

[Nitefly]

I have huge problems in understanding social things, but from this thread, the stock market thread, and other similar topics, everyone seems to have an equally bad understanding of economics.

I’m not 100% sure what you meant by this but from my perspective it’s more a sense of unfairness and inequality than solely economics.

The ‘hoarding’ of housing as an investment is just a bit of a grey area for me personally.

 

[Nitefly]

Making money and making profit are 2 completely different things.

I suspect that you are referring to profit rather than money here?

All rental income is taxable minus a few expenses. Of which mortgage isn't one of them. That means if someone pays you £900 that doesn't mean you have £900 to spend far from it.

So let's say you have £900 coming in. The mortgage is £600. You have expenses of £300. Agents take 12-15% as an example so half of that £300 is going to them and the other half is going on fees, repairs, certificates, insurance, etc.

Your actually making a loss as in your having to pay towards the mortgage yourself once you account for tax.

Which is why Simon has an interest only mortgage so he doesn't have the additional burden of paying the loan back just the interest in the hope equity increases.

Again foxeye has no clue how taxation works. He wants more tax to be paid when it's already ridiculously high.

Pointless debate as he literally doesn't have a clue how much tax is being paid.

As for property vastly outgrowing shares and stocks that's hilarious. House prices have decreased in some areas some which have lost a quarter of their value.

If house prices only ever went up and faster than stocks and shares nobody would buy stocks and shares.

Complete fantasy world.

My house went up £100k in value 5 years (a 40% increase). I have made £100k (on paper at least) by doing nothing. That is absolute madness - literally impossible for me if I was buying now. This is the sort of thing that people resent the market conditions for. I can’t blame them!!

Loopy times.

 

[platinum87]

I’m not 100% sure what you meant by this but from my perspective it’s more a sense of unfairness and inequality than solely economics.

The ‘hoarding’ of housing as an investment is just a bit of a grey area for me personally.

What you perceive as unfair, to then set a policy to correct it, is an unfair policy in itself, which causes the unfairness you tried to avoid.

This is not specific to BTL, but all policies cause similar effects, many of them translate into higher house prices, while others translate into low wages.

And you end up here.

Also, i quoted you in an edit, do you get the alert for that?

My house went up £100k in value 5 years (a 40% increase). I have made £100k (on paper at least) by doing nothing. That is absolute madness - literally impossible for me if I was buying now. This is the sort of thing that people resent the market conditions for. I can’t blame them!!

Loopy times.

Re-mortgage and lock in fixed term deal for 10 years

 

[Nitefly]

What you perceive as unfair, to then set a policy to correct it, is an unfair policy in itself, which causes the unfairness you tried to avoid.

This is not specific to BTL, but all policies cause similar effects, many of them translate into higher house prices, while others translate into low wages.

And you end up here.

Also, i quoted you in an edit, do you get the alert for that?

Re-mortgage and lock in fixed term deal for 10 years

I didn’t get the alert - I don’t have a geography degree either

Yes, regulation generally reduces individual liberty which in that sense causes its own problems, I agree, but the aim would be to address the ongoing imbalance in liberty faced by people of different wealth classes.

I don’t have a solution to it at all other than suggesting that it makes sense to me in principle that some regulation might help address the situation for the benefit of the less wealthy.

 

[Psycho Sonny]

My house went up £100k in value 5 years (a 40% increase). I have made £100k (on paper at least) by doing nothing. That is absolute madness - literally impossible for me if I was buying now. This is the sort of thing that people resent the market conditions for. I can’t blame them!!

Loopy times.

And my mates who bought a new build from Cala in 2007 lost £100k on theirs and it's never recovered. Well they paid £450k and had it valued at £320k a few years back and probably worth around £350k now. It does however now need a complete makeover including new kitchen, etc.

It's not always gains

 

[Psycho Sonny]

Re-mortgage and lock in fixed term deal for 10 years

Worst advice in this whole thread