Ban new home sales to foreign nationals...

Uther · 14 Dec 2017 at 12:12

Scam said:
Not attacking you personally, but that is a typical UK attitude to housing. Did you buy a home to live in, or did you buy it to make money? Too many people think about the latter first, that's part of the problem. House prices have been increasing since the 80s, so pretty much everyone buying expects to make a fortune out of their home. In reality, only the baby boomers (bought cheap, massive rises since) will get to make life changing amounts of money.

Absolutely. A house should be a home, not an investment opportunity.

Dis86 · 14 Dec 2017 at 12:20

Vonhelmet said:
Buying property on behalf of someone else and then reimbursing them over the course of 20 years whereupon they relinquish their claim over the underlying asset? How is that like any other investment portfolio?

Because they never own the asset. He does. It's in his name from day 1. Thought I'd said that tbh?

Vonhelmet · 14 Dec 2017 at 12:22

Dis86 said:
Because they never own the asset. He does. It's in his name from day 1. Thought I'd said that tbh?

Then what claim do they have over the rental income if the asset isn't theirs? I'd love to see the contract for something like this.

Having been through interminable money laundering training, this is exactly the sort of thing that would be triggering alarms...

Semple · 14 Dec 2017 at 12:23

VincentHanna said:
From the Labour manifesto:

The problem is there's nothing stopping the next party getting in and overturning that policy, resulting in absolutely no long term security.

Dis86 · 14 Dec 2017 at 12:24

Vonhelmet said:
Then what claim do they have over the rental income if the asset isn't theirs? I'd love to see the contract for something like this.

Surely that's the same with any investment? They don't have a claim to the rental income. Thats what he gets - hopefully and from that he pays them. If he doesnt get it he still has to pay them. They have a claim to an agreed periodic return on their initial investment of whatever %.

VincentHanna · 14 Dec 2017 at 12:25

Semple said:
The problem is there's nothing stopping the next party getting in and overturning that policy, resulting in absolutely no long term security.

Well voters can stop it, and it would be a pretty strange thing to reverse for any other party.

Vonhelmet · 14 Dec 2017 at 12:27

Dis86 said:
Surely that's the same with any investment? They don't have a claim to the rental income. Thats what he gets - hopefully and from that he pays them. If he doesnt get it he still has to pay them. They have a claim to an agreed periodic return on their initial investment of whatever %.

So they give him money, dictate that he buys property with it, dictate that he give them a fixed return, and that's it? Do they ever get their capital back?

What checks is he doing on these people to determine who they are and what their source of income is? Only those are totally basis money laundering/know your client checks that would be done in more conventional investment markets.

Dis86 · 14 Dec 2017 at 12:29

Vonhelmet said:
So they give him money, dictate that he buys property with it, dictate that he give them a fixed return, and that's it? Do they ever get their capital back?

What checks is he doing on these people to determine who they are and what their source of income is? Only those are totally basis money laundering/know your client checks that would be done in more conventional investment markets.

Yes they get their capital back through the returns. Let's say they invest 10k for a year. He will be paying them back 900 a month for example.

Vonhelmet · 14 Dec 2017 at 12:30

Dis86 said:
Yes they get their capital back through the returns. Let's say they invest 10k for a year. He will be paying them back 900 a month for example.

But they're not getting their capital back. They're getting the proceeds of the investment of their capital. No other investment in the world works by you investing capital and then just getting the proceeds from that investment and then walking away without recovering your initial stake.

TheGentry · 14 Dec 2017 at 12:50

wesley said:
The poor get poorer

true that

dowie · 14 Dec 2017 at 12:57

they don't generally, though sometimes when the rich get richer the poor's wealth doesn't increase as quickly... but over the past few decades living standards have increased across the board

Terminal_Boy · 14 Dec 2017 at 13:00

Skillmister said:
One of my clients has just bought an off plan flat in Liverpool. Over three quarters of the purchases were by overseas (predominantly Chinese) buyers.

None of whom have actually visited the place nor ever plan to live there.

dl8860 · 14 Dec 2017 at 13:07

Scam said:
Not attacking you personally, but that is a typical UK attitude to housing. Did you buy a home to live in, or did you buy it to make money? Too many people think about the latter first, that's part of the problem. House prices have been increasing since the 80s, so pretty much everyone buying expects to make a fortune out of their home. In reality, only the baby boomers (bought cheap, massive rises since) will get to make life changing amounts of money.

I do completely agree. I 100% bought knowing that we are past any point of decent growth potential, as the reason for buying was to live somewhere and put monthly payments towards equity of my own, not my landlord's.

Rather than being annoyed at missing out on future price rises, I'm more annoyed to be getting on the ladder at the end of a steep point, and therefore having significantly higher mortgage payments than someone who bought a similar property 4 or 5 years earlier. In fact prices rises or falls are a bit of a moot point for me, if anything stagnation would be perfect as so long as I don't hit negative equity, lower prices are better in terms of upsizing for my next move, as proportionally what I'm buying will have increased by less, and my salary will (should) be proportionally higher.

I was only playing devils advocate really.

The_Abyss · 14 Dec 2017 at 13:20

Dis86 said:
Wouldn't be too sure. A colleague of mine acts as a 'face' for international buyers. Essentially he buys the property to let using their money in his name. They are offered a guaranteed %age in return for x number of years.

If he can't rent it out he still had to pay them which is the risk to him but the returns are unreal. He is basically getting multiple properties paid for that in 20 years are his. So far I think he's up to about 2 dozen. Mostly flats or terraced houses with council tenants and a couple of students.

The layering step of money laundering. Tell your colleague to lube up, and you might as well too if you're aware and don't report it!

bayo000 · 14 Dec 2017 at 13:38

adolf hamster said:
Surely if the problem is buildings sitting empty as an investment then the law shouldnt be banning who can buy property, but what people must do with property they own.

For example for new builds it could be stipulated that they must be made available for sale or rent if they're not in use for a sufficient amount of time.

Ie if you buy it and dont live in it yourself you've got to let someone else have the chance. Would eliminate the problem of forgeign and domestic investors just sitting on empty properties but still allow foreign nationals to buy new houses to live in if they so require.

What length of time would you propose? I've got property abroad, I spend there on average 2 weeks per year. At the moment my parents use it but they're quite old now so eventually it will be only me using it couple of times a year as I'm not planning on selling it.

Vonhelmet · 14 Dec 2017 at 13:39

adolf hamster said:
Surely if the problem is buildings sitting empty as an investment then the law shouldnt be banning who can buy property, but what people must do with property they own.

For example for new builds it could be stipulated that they must be made available for sale or rent if they're not in use for a sufficient amount of time.

Ie if you buy it and dont live in it yourself you've got to let someone else have the chance. Would eliminate the problem of forgeign and domestic investors just sitting on empty properties but still allow foreign nationals to buy new houses to live in if they so require.

Isn't this what squatter's rights are for

Dis86 · 14 Dec 2017 at 13:51

The_Abyss said:
The layering step of money laundering. Tell your colleague to lube up, and you might as well too if you're aware and don't report it!

I'm not sure in money laundering that you tend to have a full record of the transactions through business bank accounts with clear contracts and agreed investment returns.
Also just checked, he only pays them at the end of the term, not in instalments.

Vonhelmet · 14 Dec 2017 at 14:33

Dis86 said:
I'm not sure in money laundering that you tend to have a full record of the transactions through business bank accounts with clear contracts and agreed investment returns.
Also just checked, he only pays them at the end of the term, not in instalments.

The entire point of money laundering is to bury dirty money in legitimate businesses and legitimate accounts. You're trying to hide something in plain sight.

I'm still bewildered that people are happy to invest money with him for a substandard return. If they just bought the property themselves they could enjoy the fruits of renting it out, then sell up and take their capital away with them when they were done. Presumably they're benefiting from it in some other way.

Dis86 · 14 Dec 2017 at 14:36

Vonhelmet said:
The entire point of money laundering is to bury dirty money in legitimate businesses and legitimate accounts. You're trying to hide something in plain sight.

I'm still bewildered that people are happy to invest money with him for a substandard return. If they just bought the property themselves they could enjoy the fruits of renting it out, then sell up and take their capital away with them when they were done. Presumably they're benefiting from it in some other way.

They're getting pretty good returns but also they don't have to muck about with buying the property. He sorts all of that. They just hand over money and then 1, 2, 5 or 10 years later he hands them back more than they gave him. It's low risk. The %age return is agreed up front.

Orcish-Horde · 14 Dec 2017 at 14:40

Vonhelmet said:
Then what claim do they have over the rental income if the asset isn't theirs? I'd love to see the contract for something like this.

Having been through interminable money laundering training, this is exactly the sort of thing that would be triggering alarms...

They don't but he will play ball as they will be passing more money to launder, once that money stops then they have no claim. They money they send is worthless to them, the money he sends back has worth that can legally be used. The housing market is a money laundering scam, people think the UK is making money with over sea buyers but we loss the lot when they cash out.