riverside Posted August 4, 2011 Posted August 4, 2011 Just listening to Today on Radio 4 and there was a 5 minute discussion between representatives of 1st Time Buyers and some Landlords Association about the news that Yorkshire Building Society is going to offer BTL mortgages, initially in the south and south east. Interesting facts came out 200 BTL mortgages products in 2009, 500 btl mortgage products today High Demand for Rented property BTL accounts for 11% of the total mortgage market Landlords have better financial firepower than 1st Time buyers Landlord have access to interest only mortgages and get tax breaks for maintenance and interest payments The points that occurred to me were the BTL brigade are likely to capture more of the bottom end housing market and let it out to 1st Time buyers so compounding housing problems for the young It is not a level playing field as the tax breaks give the landlords an advantage The finance companies seem to be using the landlords to reduce their risk of default on payments as 1st time buyers have lower job security I can't see the Government doing anything as the MP's are all into it anyway The only thing I can think of is that parents should, if they are able, buy property for their kids and then put them in as tenants and then sign over to them for a price at a later date so getting the tax breaks for maintanance and mortgage interest . Quote
SarahBell Posted August 4, 2011 Posted August 4, 2011 Only problem is the original BTL landlord paid 140K each for the houses so net loss on 4.5 million pounds. Lender Beware. Indeed. BTL round here - the big landlord has run out of options. He was the local market. Quote
sarahleyburn Posted August 4, 2011 Posted August 4, 2011 Just listening to Today on Radio 4 and there was a 5 minute discussion between representatives of 1st Time Buyers and some Landlords Association about the news that Yorkshire Building Society is going to offer BTL mortgages, initially in the south and south east. Interesting facts came out 200 BTL mortgages products in 2009, 500 btl mortgage products today High Demand for Rented property BTL accounts for 11% of the total mortgage market Landlords have better financial firepower than 1st Time buyers Landlord have access to interest only mortgages and get tax breaks for maintenance and interest payments I suspect that a large number of the new BTL mortgages are going to the never-ending stream of numpties who "can't sell" at the moment so convert their mortgage on their existing property to a BTL one, rent it out "until the market picks up" and then buy a new home on a residential mortgage, thus getting themselves into more debt, doubling their exposure to price falls and entering a business that they know nothing about on the assumption that things will "return to normal". (Sorry, I may have been spending too much time on MSE recently...) Quote
koala_bear Posted August 4, 2011 Posted August 4, 2011 (edited) The "priced out" rep pointed out that while the value of outstanding BTL mortgages is 11% of the total, the current market share of BTL mortgages issues is ~30%. Other points brought up on r4: BTL being IO mortgages Tax advantage of BTL mortgage interest. On your last point I know an accountant [senior partner in medium to big firm, ~60 yo but with HPC views!] who did that while his kids were at Uni on the grounds it was cheaper for him and his kids than renting from a 3rd party. "it would have been criminally stupid not to...." Just listening to Today on Radio 4 and there was a 5 minute discussion between representatives of 1st Time Buyers and some Landlords Association about the news that Yorkshire Building Society is going to offer BTL mortgages, initially in the south and south east. Interesting facts came out 200 BTL mortgages products in 2009, 500 btl mortgage products today High Demand for Rented property BTL accounts for 11% of the total mortgage market Landlords have better financial firepower than 1st Time buyers Landlord have access to interest only mortgages and get tax breaks for maintenance and interest payments The points that occurred to me were the BTL brigade are likely to capture more of the bottom end housing market and let it out to 1st Time buyers so compounding housing problems for the young It is not a level playing field as the tax breaks give the landlords an advantage The finance companies seem to be using the landlords to reduce their risk of default on payments as 1st time buyers have lower job security I can't see the Government doing anything as the MP's are all into it anyway The only thing I can think of is that parents should, if they are able, buy property for their kids and then put them in as tenants and then sign over to them for a price at a later date so getting the tax breaks for maintanance and mortgage interest . Edited August 4, 2011 by koala_bear Quote
Bloo Loo Posted August 4, 2011 Posted August 4, 2011 Just listening to Today on Radio 4 and there was a 5 minute discussion between representatives of 1st Time Buyers and some Landlords Association about the news that Yorkshire Building Society is going to offer BTL mortgages, initially in the south and south east. Interesting facts came out 200 BTL mortgages products in 2009, 500 btl mortgage products today High Demand for Rented property BTL accounts for 11% of the total mortgage market Landlords have better financial firepower than 1st Time buyers Landlord have access to interest only mortgages and get tax breaks for maintenance and interest payments The points that occurred to me were the BTL brigade are likely to capture more of the bottom end housing market and let it out to 1st Time buyers so compounding housing problems for the young It is not a level playing field as the tax breaks give the landlords an advantage The finance companies seem to be using the landlords to reduce their risk of default on payments as 1st time buyers have lower job security I can't see the Government doing anything as the MP's are all into it anyway The only thing I can think of is that parents should, if they are able, buy property for their kids and then put them in as tenants and then sign over to them for a price at a later date so getting the tax breaks for maintanance and mortgage interest . wow, another mortgage "product". tossers. Quote
Jimmy_James Posted August 4, 2011 Posted August 4, 2011 Discussion between PricedOut and the landlord lobby on BBC radio this morning. You can now listen again - On the Today Programme i player - 2:43 in: http://news.bbc.co.uk/today/hi/today/newsid_9555000/9555662.stm And on Radio5Live Breakfast Show - 2.53.50 secs in: http://www.bbc.co.uk/programmes/b0070htg Good to see getting some airtime Quote
CasualBear Posted August 4, 2011 Posted August 4, 2011 Discussion between PricedOut and the landlord lobby on BBC radio this morning. You can now listen again - On the Today Programme i player - 2:43 in: http://news.bbc.co.uk/today/hi/today/newsid_9555000/9555662.stm And on Radio5Live Breakfast Show - 2.53.50 secs in: http://www.bbc.co.uk/programmes/b0070htg Good to see getting some airtime PricedOut guy should have mentioned tenants rights, or lack thereof. Quote
Pytyr Posted August 4, 2011 Posted August 4, 2011 Discussion between PricedOut and the landlord lobby on BBC radio this morning. You can now listen again - On the Today Programme i player - 2:43 in: http://news.bbc.co.uk/today/hi/today/newsid_9555000/9555662.stm And on Radio5Live Breakfast Show - 2.53.50 secs in: http://www.bbc.co.uk/programmes/b0070htg Good to see getting some airtime good to see the beeb reconising they are opposing sides. Quote
koala_bear Posted August 4, 2011 Posted August 4, 2011 Already has it own thread (still on mainboard) http://www.housepricecrash.co.uk/forum/index.php?showtopic=167451 Quote
Killer Bunny Posted August 4, 2011 Posted August 4, 2011 Discussion between PricedOut and the landlord lobby on BBC radio this morning. You can now listen again - On the Today Programme i player - 2:43 in: http://news.bbc.co.uk/today/hi/today/newsid_9555000/9555662.stm Well done Priced Out for making the case for BTL. Quote
RufflesTheGuineaPig Posted August 4, 2011 Posted August 4, 2011 The finance companies seem to be using the landlords to reduce their risk of default on payments as 1st time buyers have lower job security. Lending to "new" BTLers *DOES* lower the risk profile, as often they will be in their 50s, with a mortgage free house to use as collateral. Quote
Killer Bunny Posted August 4, 2011 Posted August 4, 2011 Listened to Radio 4. Well done Priced Out for making the case for BTL... Quote
exiges Posted August 4, 2011 Posted August 4, 2011 Listened to Radio 4. Well done Priced Out for making the case for BTL... Who would you rather gets burned when the drops come.. BTLers or FTBers ? Quote
Bloo Loo Posted August 4, 2011 Posted August 4, 2011 Lending to "new" BTLers *DOES* lower the risk profile, as often they will be in their 50s, with a mortgage free house to use as collateral. what? Quote
Dorkins Posted August 4, 2011 Posted August 4, 2011 Lending to "new" BTLers *DOES* lower the risk profile, as often they will be in their 50s, with a mortgage free house to use as collateral. True, but if somebody 10 years from retirement wants to gamble his home in a leveraged punt on house prices, that's his problem. The words "forced seller" and "old age poverty" spring to mind. Quote
Neverland Posted August 4, 2011 Posted August 4, 2011 True, but if somebody 10 years from retirement wants to gamble his home in a leveraged punt on house prices, that's his problem. The words "forced seller" and "old age poverty" spring to mind. I think in many cases they have no option as they have little/no pension funds accumilated through lack of planning and bad decisions (also the low interest rates driving annuity rates to the floor are a factor) Often the only asset they have is a large hugely valuable unmortgaged house The other factor is due to the failure of the stockmarket over the last 15 years and various investment scandals (endowments, equitable life, lloyds market, etc.) the only successful invesment that many of these people have ever made is in residential property You can see why someone as feckless as that would MEW, buy a few flats with more leverage and hope that "my property will be my pension" Its a bit like taking all your pitiful savings into the casino and sticking everything on black.... Quote
Dorkins Posted August 4, 2011 Posted August 4, 2011 Its a bit like taking all your pitiful savings into the casino and sticking everything on black.... Given where property prices are relative to earnings, the odds are a lot worse than that! Anyway I'm sure the banks will be very grateful to all these BTLers donating their family homes to them. Quote
Neverland Posted August 4, 2011 Posted August 4, 2011 Anyway I'm sure the banks will be very grateful to all these BTLers donating their family homes to them. So... ...government bailed out banks evicting Daily Mail readers out of their homes... ...I dunno if I can see that with any political party in power... ...I could see another duplicitous government bail-out paid for by savers being putting in place to prevent that... ...but then I'm a natural pessimist Quote
silver surfer Posted August 4, 2011 Posted August 4, 2011 I talk to a depressingly large number of relatively well paid people who are replacing the company pension schemes, that they no longer receive, with BTL. Quote
Neverland Posted August 4, 2011 Posted August 4, 2011 I talk to a depressingly large number of relatively well paid people who are replacing the company pension schemes, that they no longer receive, with BTL. These would be the same sorts of people who put their money in dot com stocks, equitable life, lloyds syndicates etc. in previous decades? Quote
Pytyr Posted August 4, 2011 Posted August 4, 2011 I talk to a depressingly large number of relatively well paid people who are replacing the company pension schemes, that they no longer receive, with BTL. i was told the tail of someone trying to downsize from thier 5 bed detached but the chain was failing because the 1 bed flat at the bottom wouldn't sell. The top of the chain then bought out the bottom of the chain, with the intention of renting it out. the implication was "what a clever plan". I thought "and so the monster starts to eat it's own tail" Quote
DTMark Posted August 4, 2011 Posted August 4, 2011 Lending to "new" BTLers *DOES* lower the risk profile, as often they will be in their 50s, with a mortgage free house to use as collateral. It would presumably depend on the profile of the one buying to let. Back in the boom days, anyone could get a mortgage for it. And the presumption was that BTL was a better risk than a FTB. Except that, if I recall correctly - as defaults started to rise, it became evident that a higher percentage of BTL was defaulting relative to owner occupiers/FTB. About 1 in 3 tenants are in rent arrears at the moment; the theory was that letting to "young professionals" was foolproof. Then, as it turned out, it was that very group which began to default. Quote
Conrad Posted August 4, 2011 Posted August 4, 2011 The main reason Property price rise is because of rising income, Go out into the real world and see which way incomes are going. I thought the main reason for property price rises was loose credit... and we will see that again Quote
awaytogo Posted August 4, 2011 Posted August 4, 2011 I thought the main reason for property price rises was loose credit... and we will see that again No that is only short term rise, long term rises only due to income inflation. Quote
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