How come you tied up 200k being a LL if it doesn't pay very well? All the LL in the thread making it out that the stress / cost is barely worth it. What attracted you to being a LL in the first place?
Soldato
- Joined
- 23 May 2006
- Posts
- 7,207
i am not complaining about being a landlord, clearly there is some money to be made i am just correcting objective BS.
but that said i wouldnt have gone out of my way to buy the flat as an investement. it is the flat my wife lived in before we met and she moved in with me. One of the reasons i havent sold (its all on me, the wife wants nowt to do with it) is the huge tax implications if we do... esp as it will be a great starter home for our lad potentially, depending on what he decides to do..
that is 10years away mind you and we will make sure that any tenant gets plenty of notice.
Last edited:
I know you're not looking to sell, but just checking you know if/when you do that you only pay CGT on the appreciation for the portion of time its been a rental.
Ie: if you lived in it for 10 years then rented for 5, you'd only pay CGT on 1/3 of the gain
Soldato
- Joined
- 23 May 2006
- Posts
- 7,207
i didnt know that actually!. thanks. i thought you paid CGT on any property that isnt your 1st home... and whilst the flat is my wifes and was her home i thought once we were married it became a 2nd property for us as a couple.
good to know
Last edited:
Minor correction but worth pointing out as it's tax, that should read "for the portion of time it's been an additional home/property", it's not the fact that it's a rental that attracts the CGT liability but rather the fact it's not a primary residence (which would be exempt).
So, for example, if there was a period of time where he/his wife both lived at his house or some jointly purchased home as their primary residence but she still had that other home - say she just kept some of her stuff stored there for a year/gradually moved it out, that would still be a period in which any gains are potentially liable for CGT.
Last edited:
Soldato
Regarding this last point i have a perfect example of this. Theres an elderly couple (early/mid 70's) who live next door to my father, its a private rented property because they couldnt find a suitable bungalow with the LHA. They have been there for 8 years, the old chap is disabled and they have a good setup where they are. 4 weeks ago the landlord out the blue knocked on the door, told them hes selling and gave them their notice.
They are now frantically trying to find a bungalow to move to, when there arent any available to rent in the town. They cant find a property through the LHA as there arent any suitable ones and if there are, they have to bid on it and there are 80+ bids for each property. A few years ago they had the bathroom remodelled by the council into a wet room to suit their needs but it came with a clause that if they moved within 5 years they would cop the full cost of the remodel, and they will now be on the hook for that.
Yes he was a good landlord (must post on ocuk
) and he was charging more than the BTL mortgage apparently so profiting from it but due to whatever reason hes now selling leaving them out on the street basically. I would say this elderly couple are considerably more stressed than the landlord. Also apparently it was revalued and a 5yr fix was taken out on it 18-20 months ago so its not being sold due to increasing mortgage costs.
Last edited:
Selling is very difficult at the moment in my area. Most property around here has been up for sale for 6+ months and are still not selling even after price drops. Its not like you can have tenants in either while selling so the landlord often ends up finding its too expensive to sell as they cannot afford 6+ months without a tenant while they attempt to sell. All to sell as a depreciated value. It can turn into a large loss compared to staying as a landlord. So they get stuck being a landlord even though they want out. What a lot of people miss is even if the house is worth £10,000 more then when they first brought it then depreciated down to £8000 more then when they first brought it that isn't £8000 profit if its been sitting empty 6+ months while you try to sell and are building up all the ongoing associated costs for how ever long it takes to sale. If was a different story years back when you could put up a home and it sold in days or weeks with minimal effort. Now its months or longer the situation has massively changed.
Rent is not more then a full mortgage anymore not when you look at all the additional costs. As for £200 “profit” a month is not as much as it sounds. So that’s £2400 a year. Now subtract tax and that’s not tax on £200 profit you pay tax on the entire rental income now. The tax bill alone can be equal to or around £2400 “profit”
Now subtract all the running costs like insurance, surveys, electronic checks, boiler checks and everything the landlord has to pay for. Now you need £5000 in a pot for refurbishments, £5000 to meet all the new changing requirements from the government, another £2000 to cover emergencies like needing a new boiler. That £2400 needs to stretch to cover £5000+ of bills, fees and work and you still need a pot of refurbishments and emergency. Suddenly that £2400 profit doesn’t actually amount to anything. Its not fun, free money for the landlord.
Yet some delusional posters on here think that makes the landlord evil and immoral taking £200 profit a month over the mortgage and the landlord should instead lower the rent to cost making the landlord lose even more money.
It seems like most of the anti-landlord people in here are massively underestimating how much tax landlords pay and underestimating how many bills and services the landlord has to cover and pay for. All they see is that’s £2400 free money for the landlord to splash out on toys. Which is a load of nonsense in most cases.
(some of the figures above are variable based on differing situations)
As I said before the tenant can choose to negotiate protection into the contract so they cannot be kicked out in 1 months’ notice without warning, massively reducing the risk, stress and problem of losing there home.
The Tenant doesn’t have to worry about moving out and still having to pay the monthly mortgage despite the place being empty. The tenant doesn’t have to worry about unexpected bills, fixing things, services, consent change to government policy or things like the boiler suddenly breaking and needing £1000’s to replace. You’re missing that the landlord’s entire life can be flipped upside down all because the Tenant decided to move out without notice and not leaving the property fit to rent out for the next person. For every time a tenant life could be flipped upside-down through no fault of your own there is a matching situation where the landlords life can be flipped upside down through no fault of your own due to the tenants actions. Just losing 1 months’ rent can eats up 6 months “profit” but the outgoing costs of being a landlord do not go down and stop just because the tenant moved out and 1 months rent is missed. There is a lot more stress for landlords that tenants do not have to face. Just look at how many tenants say they like renting as it removes all the stress and the landlord has to deal with everything.
Soldato
- Joined
- 23 May 2006
- Posts
- 7,207
@Zenduri (sorry forgot to quote!) that sucks..................... but you cant have it both ways.... the guy is selling which is what many here are championing. a private landlord is for what ever reason getting out of the game. if many in this thread have their way there would be a lot more of this going on.
they cant find a poperty with the LHA - further proof that private landlords are vital....
its seems to me people want private LLs to sell up, but at the same time not give notice to ask the tenants to leave......... how is that possible because to me that sounds like it would be a hell of a magic trick?
if they are lucky maybe another potential landlord will buy the property and they wont end up having to leave... (a good long term tenant sounds like something a property investment buyer would see as a massive plus point).
they cant find a poperty with the LHA - further proof that private landlords are vital....
its seems to me people want private LLs to sell up, but at the same time not give notice to ask the tenants to leave......... how is that possible because to me that sounds like it would be a hell of a magic trick?
if they are lucky maybe another potential landlord will buy the property and they wont end up having to leave... (a good long term tenant sounds like something a property investment buyer would see as a massive plus point).
Last edited:
Soldato
My argument from day 1 has been we need more suitable council owned rentals for those who cant buy or need to rent and that individuals and corporations shouldn't be holding multiple housing stock. Sadly both are broken and neither will change. Landlords selling up only puts housing stock back in for buyers but doesnt solve this rental situation i listed above. You need new council ran rental stock as well as landlords returning properties to the market, i dont think anyone has said any different so your comment comes across poorly as "you want X but you cant have it so your stuck with us, like it or lump it"
Sometimes i think people miss the point that we need rentals but we DONT need private and corporate landlords. There is a big difference and it sometimes comes across that landlords are justifying their existencebecause the market has forced people to support their existence
Last edited:
Soldato
- Joined
- 23 May 2006
- Posts
- 7,207
i totally agree we need more council owned rentals... so on that we agree.
Solve that issue and the private LL issue solves itself regardless of where you stand on them..... I cant control what the council do (other than vote accordingly) ..... Your argument on here may be we need more council owned rentals - and i agree - but many anti LL people on here are more concerned with getting private LLs out of the market ... you (not the literal you, i dont expect you to fix it) need to fix the council owned properties issue BEFORE forcing out the private LLs or you will get exactly the same issue you mentioned.... an elderly couple caught in the middle and it sucks.
looking back i realise my "you cant have it both ways" sounded directed at you, but it wasnt my intention it was the figurative you not the literal one so i appoligise if you felt i was misrepresenting the actual "you".
Solve that issue and the private LL issue solves itself regardless of where you stand on them..... I cant control what the council do (other than vote accordingly) ..... Your argument on here may be we need more council owned rentals - and i agree - but many anti LL people on here are more concerned with getting private LLs out of the market ... you (not the literal you, i dont expect you to fix it) need to fix the council owned properties issue BEFORE forcing out the private LLs or you will get exactly the same issue you mentioned.... an elderly couple caught in the middle and it sucks.
looking back i realise my "you cant have it both ways" sounded directed at you, but it wasnt my intention it was the figurative you not the literal one so i appoligise if you felt i was misrepresenting the actual "you".
Last edited:
Really? You should have mentioned it before.
And round and round we go.
True yes, thanks for the correction. I was typing quickly and just thinking about about it in context of Mike's situation
Soldato
- Joined
- 24 Sep 2007
- Posts
- 4,857
What changes is the ease with which banks can create price inflation in the housing market, and inflation in general. At the moment we have a Central Banking system where more currency can easily be introduced into the system by the bankers. It is after all, their currency. This finds its way mainly into house prices as they are the primary form of loan to the consumer. If the bankers can introduce more currency supply, house prices can be inflated, making it harder or impossible for many working people to pay them. I mean, look at the loan multiples currently required to buy a house. My view is that taking away supply of the currency from the bankers would allow the economy to function better for normal people, as the bankers no longer have an unfair advantage. Essentially it creates an anchor to the real economy, where people earn money by making goods or provide services to one another. If bankers cannot create money from thin air, then house prices don't get inflated, and the money people earn in the real economy is enough to finance a house!
The lending function of banks can continue, but it should be with more discipline, where banks are allowed to go bust if they get it wrong. That is how proper capitalist economics should work. We have already had the massive bailout of the 2008 crisis, and this was done by currency issuance (money printing) by the banks. Essentially this was a centrally managed bailout and the equivalent of Communism, and nothing like a proper capitalist economy. Massive currency issuance is continuing to this day, and must continue now otherwise the currency collapses, which we are already seeing somewhat in price inflation, which is continuing apace and likely to get worse.
Of course this is all a somewhat utopian hope, because those in power will run the system for their own ends, hence we have normal working people priced out of the property market today.
Last edited:
Soldato
Much the same as we go around with the virtuous landlords association that seems to be on OCUK and the need for them to continually justify themselves
Soldato
- Joined
- 23 May 2006
- Posts
- 7,207
no justifying here.. my conscience is clearMuch the same as we go around with the virtuous landlords association that seems to be on OCUK and the need for them to continually justify themselves
Soldato
Wasnt aimed at youno justifying here.. my conscience is clear
You have no idea how well I sleep at night.Much the same as we go around with the virtuous landlords association that seems to be on OCUK and the need for them to continually justify themselves
In fact, as you have no idea (in general), I sleep like a log.
Soldato
- Joined
- 24 Sep 2007
- Posts
- 4,857
It depends what you mean by worse off. Maybe in terms of short term cash flow a landlord could be worse off, but in general in terms of overall wealth and assets they will still be much better off.
I would also say the main risk of landlords losing money is negative equity when the property market crashes. Property market crashes are also a symptom of artificial price inflation via too much credit extension in mortgage loans (which in recent times has been saved by currency issuance via money printing). The market gets pumped too much by a greedy banking sector, which in turn can lead to a property crash which is very damaging for the small time landlords.
I don't have a problem with the role of landlord, many of whom do a valuable job in terms of their property transformation / upkeep skills, more with the runaway banking sector. I think the banks are to blame, but they have captured government, and the problem is poorly understood by most British people because they don't take enough interest in finance. Hence we have the boom and bust cycles of today. Personally I advocate for paper currency issuance to be taken out of the hands of the private banking sector, and feel this would solve many of the problems with the UK economy and the housing market, and allow a much more prosperous capitalist economy. The best solution I have seen for this is Bitcoin. However, those in power will not want to give up the immense power that comes with the ability to issue currency.
Much the same as we go around with the virtuous landlords association that seems to be on OCUK and the need for them to continually justify themselves
If you are constantly being corrected maybe consider why. LLs don't set housing policy or implement it.
Soldato
Why not a
Much in the same way as I don't believe I could call all renters responsibility dodging, free house living, home trashing scum.
It's just not reality.
I don't think it's small time landlords painting themselves to be 'virtuous' it's more defending against the barrage of money grabbing, golden goose teet sucking, evil misery merchant accusations.Much the same as we go around with the virtuous landlords association that seems to be on OCUK and the need for them to continually justify themselves
Much in the same way as I don't believe I could call all renters responsibility dodging, free house living, home trashing scum.
It's just not reality.