Sunday, Jul 15, 2007
Rising Interest rates offers opportunities in UK property for some...
The Landlord Association: Rising UK interest rates are benefiting buy to let investors
Rising interest rates are crippling first time buyers. This in turn forces them to rent which plays nicely into the hands of buy to let investors as they have property to let. But they are too feeling the squeeze as they try to cover rising interest repayments. In turn rental yields are increasing. Where is the UK housing market heading? Surely it cannot sustain this tic-tac-toe for much longer...
Posted by landlordexpert.co.uk @ 09:13 AM (216 views) Add Comment
5 Comments
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1. confused76 said...
Bullshit. You cannot segment housing suppy into rented and owned since they are almost perfect substitutes. There is demand pressure and this is why rentals are increasing. Nothing to do with interest rates, that make the financing of house purchase equally tougher for owner occupiers and BTLers
2. Man Who Is Not Only 31!!!! said...
Confused 76 -
I don't think you know what you are talking about in the slightest!
The demand for rented property has gone up with interest rates. This benefits landlords and investors. How you can see a different picture is quite beyond me and probably everyone else that reads your toff!
3. the landlord assocation said...
I have no idea what you are talking about to be honest confused76 - I think your forum name says it all really.
I am a Director at The Landlord Association - we are neither anit-hoise price crash or against it - we look at 'market reality' as this is what will dictate our investments.
When interest rates rise it offers landlords a chance to capitlise that more people will have to rent. This is the demand caused by interest rate rise.
I appreciate your opinion (something which you seem to value very highly in these forums) but you are wrong, fact!
4. bidin'matime said...
Landlord Association - if people can't afford to buy, then they can't afford to pay the landlord's mortgage, can they? So by definition, if the landlord sets out to target those who can't afford to buy (as you suggest), then he will be losing money, will he not? Hardly a sound business model. And any landlord who has managed to put his rents up by over 25% in the last year (equivalent to the rise in interest rates) would deserve a medal from your august association – you shouldn’t have to cast too many…
I’m delighted that my landlord is subsidising my occupation of his property – I make more in interest after tax (much more..) on my equity, than I pay in rent, for a house worth more than the one I sold!
Oh, "capital appreciation", I hear you say - well, with the last 10 year's excessive price growth to unwind, it doesn't take a genius to work out that there will be none of that for at least a decade – and we are in for a downswing in the meantime, so hold onto your hat…
Just face it - BTL will go out of fashion soon and the dinner party talk will be of who managed to get out and just how much they had to drop their prices to do so...
5. jason said...
I'm not sure if that's a genuine post by the Landlord Assocation, but their logic is just funny.
I'd say something clever, but bidin'matime covered all that needs saying.