Monday, Feb 12, 2007
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thisismoney.co.uk: What can I do with buy-to-let?
I bought a buy-to-let property three years ago on a fixed rate mortgage deal of 4.5%, which has now run out. I have an interest-only mortgage of £230,000 on the property and rent it out for £1,000 per month. However, rates have risen to make potential monthly payments the same as the rent and many buy-to-let deals now seem to be charging big fees.
Posted by uncle chris @ 11:37 PM (135 views) Add Comment
15 Comments
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1. Rubberneck said...
If you can't stand the heat.... sell up and start the slide Mr/Ms BTL
2. george monsoon said...
well wasn't that a good investment then. I wonder if this donkey even asked themselves the question "what if interest rates rise?"
Has the tide finally turned?
3. Bart Simson said...
Ha ha ha ha ha... Sucker.
4. Bart Simson said...
Ha ha ha ha... Sucker!
5. d'oh said...
Quote: "Whenever interest rates climb it takes several months (or even years) for rental income to reflect the extra cost of living but it will eventually adjust, as long we do not suffer a recession. In addition, the general lack of rental property in the UK will ensure that any slowdown is only short term so it is inevitable that rents will climb again."
"As long as we don't have a recession"...hahahahahahahahahahahahaha...Um, hasn't the author just pointed out that wage inflation will have ot let rip, or are we expecting the serfs to scrabble around in the dirt for potato skins after they have paid the rent? Wage inflation = higher interest rates = even more increases in mortgage costs. Obviously what happens is determined by which factor dominates, but this advice is risible.
Talking of risible, Ruth Kelly is drivelling on on Radio 4 at present. One frighteningly stupid woman.
6. sovietuk said...
Hopefully rates will rise alot more and crucify this muppet. Even better still house prices will go down so that the muppet is first 'lobster potted' in negative equity and then crucified.
7. ontheotherhand said...
At £1,000 rent on somewhere supposedly worth £320,000 the Gross rental yield before void periods, agent commissions, and upkeep costs is only 3.75%. This begs the question as to who would buy this flat off him for £320,000 as an investment with such a low yield. The answer is a Greater Fool/Optimist. 3% Net from an illiquid flat with purchase costs or 5.25% from a government bond which you could sell in the blink of an eye - which do you prefer?
8. sovietuk said...
Well, there's the answer, the asset is just not worth it. Advice - don't buy property in the current climate.
9. Sam said...
err, how about this as an option. if you are paying a mortgage on your own place. sell it and use the money to reduce your own debt.
10. Cstanhope707 said...
Well Done Uncle Chris! I did not think it was possible and I never thought I would see it but you may have actually managed to find an article about someone more stupid than that annoying women in the BBC Debt Diary......
11. Cstanhope707 said...
Sorry Uncle Chris my mistake I may be wrong someone just mentioned Ruth Kelly I forgot about her.
12. Bob Bingle said...
lol
13. Everyday_idiot said...
So your gravy train is slowing down, and the free money isn't pouring in any more? Whatever can you do? Sell the BTL and buy a brain.
14. dohousescrashinthewoods said...
Even better, "the general lack of rental property in the UK" - where exactly des that come from? With BTL booming but buildings empty and to let in most cities, I don't see that. He also mentions recession in the same sentence - do you think this journo is trying to put across a message between the lines in spite of editorial control?
We shouldn't be too harsh on BTL though, this chap and others like him will, through auctions, be redistributing property into the grateful hands of sensible FTBs who are quietly biding their time.
15. Disgustedofyork said...
Schadenfreude is a wonderful thing!