Thursday, Sep 20, 2007
Buy to let in serious trouble...
Home.co.uk: Buy to let in serious trouble
Article designed to frighten those in financial difficulty into selling their property to "National Homebuyers". What I don't understand is how they reckon they will be able to turn sentiment round in a year or two once prices are generally seen to be falling. If they hold on to the houses they buy now 'at a discount' - their stock will soon be in negative equity itself.
Posted by cornishman @ 08:12 AM (455 views) Add Comment
5 Comments
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1. cornishman said...
Sorry, I know it's bad form to comment on your own posting, but I couldn't help chuckling at the fact that the spokesman for National Homebuyers is called David...
2. Robert Mugabe said...
Well I can give them some very sound financial advice learnt from running my country. Inflate your way out of trouble. M
Mr. King and Mr. Brown and I were only discussing this the other day and we thought it would be a good idea to reduce interest rates.
3. su said...
Why is it bad form to comment on your own posting? If you have an interest in the topic you've posted, then it makes sense to comment on it, especially if it contains something you'd particularly like to bring to our attention. Others may disagree (?) but I think its OK, positive even!
4. tyrellcorporation said...
Cornishman is being polite - it's not bad form at all, I do it all the time as it get's the ball rolling with the article and gives the poster the chance to add views which can't be added in the article description. Go for it, this is Aussie-Rules blogging! :)
5. dugmug said...
It is probably unlikely that the base rate will rise in the short-term, given the current problems that are occurring, although not raising it/dropping it will mean higher inflation, partly cuased by a weaker £, so rates will have to go up eventually anyway (it's just delaying the inevitable). In the short-term, therefore, this press release could be considered a bit of scaremongering. Good! About time there was some scaremongering in favour of HPC rather than HPI I say! :-)
And even having said that, mortgage rates are likely to continue rising even if The Bank doesn't put up the base rate, with the way things are right now in the credit markets, so if they'd have used that argument they would have been on more solid ground - I suppose that argument would have been a bit to sophisticated for the target audience though!
And all the properties they are hoovering up at 20% below market value will help redice average prices as shown in the Land Registry index, helping to force sentiment even lower - brilliant!
So, I dislike these companies from a moral perspective but from an HPC perspective they're fab; ain;t life complicated! :-)
[NB: we all have to remember that as with house prices, the economy can go down as well as up, and it will probably go down along with house prices, so whilst I'm happy things are turing because I've been awaiting the crash so long, there is part of me keeping my fingers crossed that I still have a job at the end of this - please do not mistake my glee for naive stupidity]