Are earnings too low / living costs getting too high??

[FoxEye]

Lol, being from Bridgend, the case rests your honour

Those two sentences were not supposed to be connected! I didn't think Swansea was that bad The mumbles had a really nice ice cream restaurant, and... erm...

 

[dowie]

Would you say that putting your money into a bank is a risk? The banks could go under!

In reality tho, the govt steps in to rescue the banks. Same with housing. Too big to fail. The sheer demand for housing being as insatiable as it is, and the demand growing faster than supply can possible match, means that inequity between supply and demand is only going to get worse.

House prices *cannot* possible fall in such a scenario. It is divorced form reality to think there is a "risk" of house prices substantially falling. 5% annual growth for the last few years and the same again is expecting by all predictions, on average.

Your bank deposits are protected to an extent, it is not the same with housing at all. Of course there is risk of house prices falling, you don't know what brexit is going to bring, you don't know what interest rates will be like 2 years from now or 5 years from now. And again there are other risks in owning a BTL property as mentioned before.

 

[Madwelsh]

You clearly voted Tory last election

You are right about the housing and the government doing everything it can to avoid a crash, mainly because the hogs with the noses in the trough will lose loads themselves.. I find it an outrage that any MP who voted to remain is still at parliament.. how can someone with a vested interest to remain, stay at the slop-bowl when the majority voted leave? They have no shame because they are crooks, someone who voted remain is now running the country (again not elected by the masses) to take us through the leave process.. tell me that isn't somewhat buggered before it starts?

I am old enough and unwise enough to see 2 crashes that I remember, and no fannying from the morons could avert it.. it happens, almost everyone gets burned, it isn't the answer though, it doesn't change circumstance, it doesn't change society, society is all about wealth, until that changes, the current situation will prevail. Argue all you like, you either learn the game, or sit in the stands.

 

[bowey]

My bills keep going up and my wage keeps going down annoyingly. The only thing i was actually surprised at the last year was my energy bills were quite low with ovo

 

[FoxEye]

Your bank deposits are protected to an extent, it is not the same with housing at all. Of course there is risk of house prices falling, you don't know what brexit is going to bring, you don't know what interest rates will be like 2 years from now or 5 years from now. And again there are other risks in owning a BTL property as mentioned before.

House prices *can't* fall, unless the banks start refusing to give mortgages to a significant number of people. Which the govt will not allow.

They can't fall because growth in demand is outstripping growth in supply, and we started with a supply deficit to begin with!

And really what does Brexit change in all this? Is it going to make people flood out of the UK, such that we suddenly have enough housing to go around? Hardly. And if the Pound devalues it just makes property more attractive to overseas investors.

You must well know that these days a certain % of property in London is reserved for overseas buyers? That there are specialist agencies in Asia which specifically exist to auction off UK housing to Asian buyers? And not just Asia, of course.

House prices aren't going down. Nobody is predicting house prices to fall. Nobody. Find me anyone who is predicting house prices to fall, please...

http://www.independent.co.uk/voices...don-property-market-pound-slump-a7525961.html

 

[dowie]

House prices *can't* fall, unless the banks start refusing to give mortgages to a significant number of people. Which the govt will not allow.

Why do you have so much faith in the ability of the govt to stop market forces? What do you believe they can do to prevent house prices from falling?

House prices aren't going down. Nobody is predicting house prices to fall. Nobody. Find me anyone who is predicting house prices to fall, please...

again you're failing to understand risk, stating that there is risk in owning buy to let properties and highlighting that one (of those several risks) is the value of your investment falling doesn't infer a prediction that house prices will fall but is simply highlighting that they could fall

 

[FoxEye]

So basically saying that P(House prices falling) >0 therefore is a "risk".

Theoretical risk, not a real one. Mathematically possible but nowhere near probable.

It's semantics. If you were advising someone whether or not to buy property for its rental value and they said, "What's the risk of house prices falling?" You'd say, "minimal". The risk of getting a bad tenant is much more real, but easily manageable. Your certainly more at risk if your portfolio is on the small side, and capital is tight. For the larger "players" with multiple properties and available capital there are almost no "risks" worthy of mention, in the current climate.

So it's not my understanding that's at fault here. It's a refusal by some to accept that the risks are minimal and barely worth mentioning at present.

 

[dowie]

It isn't semantics at all and there is plenty of uncertainty re: the housing market over the next 5 years or so.

I'll ask the questions again:

Why do you have so much faith in the ability of the govt to stop market forces? What do you believe they can do to prevent house prices from falling?

 

[Madwelsh]

So basically saying that P(House prices falling) >0 therefore is a "risk".

Theoretical risk, not a real one. Mathematically possible but nowhere near probable.

It's semantics. If you were advising someone whether or not to buy property for its rental value and they said, "What's the risk of house prices falling?" You'd say, "minimal". The risk of getting a bad tenant is much more real, but easily manageable. Your certainly more at risk if your portfolio is on the small side, and capital is tight. For the larger "players" with multiple properties and available capital there are almost no "risks" worthy of mention, in the current climate.

So it's not my understanding that's at fault here. It's a refusal by some to accept that the risks are minimal and barely worth mentioning at present.

You also are failing to take in the demographic that people on here maybe own 2 properties, one to live in the other let, the risks are all to real to them.. I think you are sticking everyone in the same boat, would you group Sauber with Ferrari? Yes they both race in F1, but it's chalk and cheese, one has unlimited cash, the other barely struggles by.. yes it's the same mantra, but for example a problem tennant or a major problem with the heating/ roof etc can mean a big loss for the landlord..

 

[Freefaller]

Even if you decide that owning a home is not important... you will likely pay *more* in rent than a mortgage would cost!

Now certain people here applaud BTL landlord's as "risk takers", "entrepreneurs", "smart investors", etc. But there is nothing entrepreneurial about using buying up all the housing stock, knowing full well that everybody *must* have a house to live in. Where exactly is the "risk"? They can pick and choose their tenants, evict them with as little as two weeks notice if they object to yearly rent increases... And we know now that the government will not allow the housing bubble to burst, no matter what. BTL landlords can put up rent to astronomical levels, knowing that demand is insatiable and that the government will help their tenants pay these exorbitant rents! Housing benefit now costs the UK govt almost £30 billion a year.

The entrepreneurial spirit is seeing a gap in the market, innovating to produce a new product, or doing something differently. Being a BTL landlords is not clever. Not innovative. They are exploiting their good fortune in having sufficient capital to invest in housing, often having started many years ago when housing was affordable. Now as the increase in renters and decrease in owners shows, those who don't already own property are frozen out of getting on the ladder. Meanwhile BTL can still use their existing properties to get mortgage terms the banks won't give to anyone else. The measures the govt has taken to reduce gaming the tax system don't address this. People with a few properties under their belt are now many times more likely to buy new housing than somebody who wants to live in that house.

But this is a "service" right? We should be grateful for BTL - and as mentioned, foreign property investors - who snap up all the new builds, because what we locals most want in all the world is to pay more in rent to them than they pay in mortgage repayments. It's a fantastic service and I'm super glad BTL landlords are here to provide it.

Anecdotal, sure, but around here and in neighbouring towns we've seen a lot of new-build estates go up. Walking around them it's funny (not) to see how many are now rented out, just another property in somebody's growing portfolio.

We really should stop applauding people who do this. It is not the kind of innovation that will drive this country forwards. It's simple opportunism. That's all. Opportunistic profiteering. To applaud these people for "investing well", "being smart", etc, and to call the neigh-sayers "jealous" really is insulting to our intelligence. I have no doubt things will get much worse. In a few years time we'll look back on today as a time when more people owned their own home than rented. Because in future, if current trends continue, not only will many of us be wage slaves to the landlords, we have have engineered through apathy a new Victorian era, with record homelessness, and perhaps even complete societal collapse.

Frankly that's not an exaggeration. When discontent grows and grows and inequality ever increasing, it's only a matter of time. By that time the BTL landlords need to have earned enough money to pay for their own private security forces.

I get your frustration and disdain.

However, if I won the lottery (if I played - I don't!) I would certainly buy a few properties to rent. After paying off my own mortgage and having a handful of properties (that I would run professionally, not be a charlatan) that's all I would need. You wouldn't have to go to work (though I think I'd still want to do something).

Say you buy 2-3 properties (depending on where you were and how much money you won) put the rest in savings, or whatever. With 2-3 properties, and buying them outright, you could ask for a lower rent as well. So say a small rent of between 800-1200 a month. IF you had no more mortgage to pay yourself, you could survive on that easily for the rest of your life, and still save a bit for some luxuries, you also have equity which you can either pass onto your kids, or sell if you need to.

I'd far rather invest in property or something I have a little knowledge on, than shoving it in the stock market which I have no clue on.

 

[413x]

Yes. Luckily I don't want kids otherwise I'd be screwed lol.

I could have my own place by now, but I don't intend to live here much longer. Never have. So It makes no sense to buy. But it also hurts to pay rent

 

[jonneymendoza]

I get your frustration and disdain.

However, if I won the lottery (if I played - I don't!) I would certainly buy a few properties to rent. After paying off my own mortgage and having a handful of properties (that I would run professionally, not be a charlatan) that's all I would need. You wouldn't have to go to work (though I think I'd still want to do something).

Say you buy 2-3 properties (depending on where you were and how much money you won) put the rest in savings, or whatever. With 2-3 properties, and buying them outright, you could ask for a lower rent as well. So say a small rent of between 800-1200 a month. IF you had no more mortgage to pay yourself, you could survive on that easily for the rest of your life, and still save a bit for some luxuries, you also have equity which you can either pass onto your kids, or sell if you need to.

I'd far rather invest in property or something I have a little knowledge on, than shoving it in the stock market which I have no clue on.

good point

 

[grudas]

I get your frustration and disdain.

However, if I won the lottery (if I played - I don't!) I would certainly buy a few properties to rent. After paying off my own mortgage and having a handful of properties (that I would run professionally, not be a charlatan) that's all I would need. You wouldn't have to go to work (though I think I'd still want to do something).

Say you buy 2-3 properties (depending on where you were and how much money you won) put the rest in savings, or whatever. With 2-3 properties, and buying them outright, you could ask for a lower rent as well. So say a small rent of between 800-1200 a month. IF you had no more mortgage to pay yourself, you could survive on that easily for the rest of your life, and still save a bit for some luxuries, you also have equity which you can either pass onto your kids, or sell if you need to.

I'd far rather invest in property or something I have a little knowledge on, than shoving it in the stock market which I have no clue on.

agreed, I believe a lot of people would do that.

I mean if I was in the place to buy multiple properties I would do it so I can't be annoyed at people who manage to buy multiple and rent them out, the chance of them not making money is very low.

my current landlord has multiple properties around south london including a couple of businesses and to be fair, good on him. I'd do the same as I believe it is one of the safer/noob friendly ways of making money.

 

[jonneymendoza]

agreed, I believe a lot of people would do that.

I mean if I was in the place to buy multiple properties I would do it so I can't be annoyed at people who manage to buy multiple and rent them out, the chance of them not making money is very low.

my current landlord has multiple properties around south london including a couple of businesses and to be fair, good on him. I'd do the same as I believe it is one of the safer/noob friendly ways of making money.

The problem is the foreign investors doing it and pricing out even us guys who could buy.

Not long until you actually need to be a millionaire to own a property here in London at least

 

[grudas]

The problem is the foreign investors doing it and pricing out even us guys who could buy.

Not long until you actually need to be a millionaire to own a property here in London at least

that is the problem I agree, I think it's crazy how you're allowed to just buy up property in london and drive up the prices and drive people out of the city.

wasn't there like a massive part of central london that is owned by some arab family or something along the lines...

 

[dr_volki]

It isn't semantics at all and there is plenty of uncertainty re: the housing market over the next 5 years or so.

I'll ask the questions again:

Why do you have so much faith in the ability of the govt to stop market forces? What do you believe they can do to prevent house prices from falling?

just being rational here, from what i can tell / see the housing market doesn't pose that many risks anymore due to supply / demand and yes i can see the risks you have mentioned before.
however if you are saying there is plenty of uncertainty in the housing market for the next x number of years. how come people aren't pulling out? (may be they are i don't know, but would happy to hear your thoughts )
so the logical answer to me would be it's still a more stable investment compared to other investments.

saying that i don't understand the hate on the BTL landlords. it's unreasonable. there needs to be a market for BTL, what the ration needs to be compared to home ownership i do not know. This being said the government does need to step in at some point i believe to achieve a healthy balance on what is being paid in rent on BTL properties.

 

[Tunney]

The problem is the foreign investors doing it and pricing out even us guys who could buy.

Not long until you actually need to be a millionaire to own a property here in London at least

There's a new build block of flats around the corner from me where a studio flat is on the market for £730,000. This is zone 2 London so desirable but not right in the heart of the city.

Who is buying flats like this? Surely even a BTL landlord would struggle to rent it out at break-even. I can only imagine its overseas investors speculating on house prices going up.

 

[Irish_Tom]

Do the people who take issue with BTL landlords have a problem with landlords in general, or just those who are using their rental income to pay off a mortgage?

Do they stop being morally corrupt the minute the mortgage is cleared?

Or should all property that is not lived in by the owner go into public control and we have no private landlords at all?

Just interested in how far the moral argument extends.

 

[Jez]

Do the people who take issue with BTL landlords have a problem with landlords in general, or just those who are using their rental income to pay off a mortgage?

Do they stop being morally corrupt the minute the mortgage is cleared?

Or should all property that is not lived in by the owner go into public control and we have no private landlords at all?

Just interested in how far the moral argument extends.

I think the complaint is the fact that regardless of funding they consume a finite resource required for living, as their own private investment vehicle. I dont see why the funding source would come into it.

(For the record i am a cash funded landlord)

 

[antijoke]

Even if you decide that owning a home is not important... you will likely pay *more* in rent than a mortgage would cost!

Now certain people here applaud BTL landlord's as "risk takers", "entrepreneurs", "smart investors", etc. But there is nothing entrepreneurial about using buying up all the housing stock, knowing full well that everybody *must* have a house to live in. Where exactly is the "risk"? They can pick and choose their tenants, evict them with as little as two weeks notice if they object to yearly rent increases... And we know now that the government will not allow the housing bubble to burst, no matter what. BTL landlords can put up rent to astronomical levels, knowing that demand is insatiable and that the government will help their tenants pay these exorbitant rents! Housing benefit now costs the UK govt almost £30 billion a year.

The entrepreneurial spirit is seeing a gap in the market, innovating to produce a new product, or doing something differently. Being a BTL landlords is not clever. Not innovative. They are exploiting their good fortune in having sufficient capital to invest in housing, often having started many years ago when housing was affordable. Now as the increase in renters and decrease in owners shows, those who don't already own property are frozen out of getting on the ladder. Meanwhile BTL can still use their existing properties to get mortgage terms the banks won't give to anyone else. The measures the govt has taken to reduce gaming the tax system don't address this. People with a few properties under their belt are now many times more likely to buy new housing than somebody who wants to live in that house.

But this is a "service" right? We should be grateful for BTL - and as mentioned, foreign property investors - who snap up all the new builds, because what we locals most want in all the world is to pay more in rent to them than they pay in mortgage repayments. It's a fantastic service and I'm super glad BTL landlords are here to provide it.

Anecdotal, sure, but around here and in neighbouring towns we've seen a lot of new-build estates go up. Walking around them it's funny (not) to see how many are now rented out, just another property in somebody's growing portfolio.

We really should stop applauding people who do this. It is not the kind of innovation that will drive this country forwards. It's simple opportunism. That's all. Opportunistic profiteering. To applaud these people for "investing well", "being smart", etc, and to call the neigh-sayers "jealous" really is insulting to our intelligence. I have no doubt things will get much worse. In a few years time we'll look back on today as a time when more people owned their own home than rented. Because in future, if current trends continue, not only will many of us be wage slaves to the landlords, we have have engineered through apathy a new Victorian era, with record homelessness, and perhaps even complete societal collapse.

Frankly that's not an exaggeration. When discontent grows and grows and inequality ever increasing, it's only a matter of time. By that time the BTL landlords need to have earned enough money to pay for their own private security forces.

Spot on. 100% agree with you here.