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Steamerpoint

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  1. Hmm... A perfect storm could be brewing. Buy to let landlords have all but dried up in the Midlands (Suspect elsewhere too), anti-immigration rhetoric plus stronger immigration controls post Brexit coupled with the beginning of the demise of the baby boomers should see demand for property reducing. This should slow down house price growth. An increased availability of housing stock has began with many private landlords selling off their portfolios as higher taxes start to bite. With Immigration under stricter control, employers will find it harder to recruit staff and wage increases should naturally rise. So with property prices stagnating and wages increasing, we could one day see borrowing levels return close to the previous 4x salary. I wouldn't expect it for another 10 years though!
  2. Steamerpoint.. Peterboroughs original friendly EA!

  3. It's fair to say that things could be just as bad or worse elsewhere and that is why the currency is strengthening agaist other currencies. Currency investors may feel more confident keeping their money in Sterling at the moment especially while other economies are reluctant to put there cards on the table and make public just how bad things really are. Only this week, there was a call to the European banks to admit their losses & exposure, which they still haven't done. At least here, most of the damage has been done and we know just how bad things are and it's really bad, but it's reasuring to investors that they can see the risks and manage them accordingly. I believe that the Eurozone is the next big casualty on the horizon. The cracks are showing everywhere! To be fair, USA is in danger again too! What a mess!
  4. Um...... not really and this is why. The property I bought in early 1992 had been on the market for £71,000 around the peak in 1988/ early 1999. I paid £55k for it, but even now the property is worth £150k, which is more than double what I could have paid for it in 1988/89 so in terms of resale today, I would have been quids in. Again as I never intend to sell it, it matters not. Sure if I had sold it in 92 then sure I would have lost money and anyone that bought in 2007 would be dumb to sell now, but the point is this. It's a long term investment and over the long term you can't lose out especially if you never sell. It depends what you want. Invest for a few years, avoid property and stick to other investment options or invest for a pension or longer term nest egg, buy a BTL property. Oh and the following cutting may interest a few people looking to go down the pension route.
  5. It's not guru like wisdom, it's looking at the basics. Should I use someone elses money (The Banks) to invest in something that people want and who will repay the loan? Even if the answer was partly repay the loan, it means that the house that I have bought is subsidised! It's partly paid off by the tenants. Even if it cost me half the price of the house, it's still half price!!! Ironically, this plan works better when there are plenty of people out there refusing to buy and sticking to rental property. More future tenants. Even better if there are few competing buyers around as you have better choice, greater chance of finding a bargain or negotiating one. Then to top all that, you've got tax relief on the interest element of the loan, so the tax I was paying for this wonderful long term investment is also reduced and the final icing on the cake is when I agreed to have a single parent woman entitled to council benefits, live in one of my homes, where she stayed for 9-years. No missed payments, index-linked so increased every year and in effect, the governement (Every tax payer) was buying a house for me. Sweet. When I bought the 3-bed detached house with a garage for £55,000 I thought this was a huge amount of money and initially I was paying £322 per month on my repayment mortgage and I was only being paid £300 a month from the tenants, but I realised that it was a long term plan and within only a year or two, I was able to increase the rent and cover the cost completely. Modern BTL landlords only seem to care about current yield and capital growth!!! Who cares about any of this if someone is subsidising your investment purchase!! Even if you do bring these things into the equation, where will house prices be in 25-years time do you think? Well I'm guessing they will be up. Yield, okay you don't want to fork out too much of your own money if you don't have to so buying something that can wipe it's own face is a good plan, but come on, in this market, that's achieveable! Market Harborough 2.89% fixed for 2-years £165k loan = £397 per month. Tell me you can't find a decent house with a £165k loan that you can't rent out for more than £397 per month. I mean I've got a 1-bed house worth only £90k that's bringing in £450 a month so it's do'able now. It makes sense to wait for prices to bottom out before you buy though, but it is very hard to buy at the very bottom of the market because when it turns, vendors often want more money before the sale completes. This is due to the fact a sale often takes between 8 & 12 weeks from start to finish. I think you just have to gauge it about right, find the right property and negotiate hard to get the best deal you can. If prices have fallen further during the purchase, ask for a further reduction just before exchanging contracts, you might get lucky and knock a bit more off! Then relax and don't worry about house prices ever again. Buy yourself a chuff chart and each year cross another year off and look forward to your retirement. Oh and BTW, if you find that rental prices rise sharply over the years, ask the bank if you can increase your monthly mortgage repayments and shorten the life of the loan. We did that and knocked off 5-years making it only 20-years to D-day.
  6. Er... Letting Agent actually, but close. As those who know me will tell you, I bought 4-BTL properties as part of my future pension plan. Once they are paid off in full by the tenants, I will retire keeping the houses and living off the income. Because of that, I am not concerned with the future value (Within reason as it could effect future rental income if it was too low) as I have no intention of ever selling them. All I had to do was raise the deposit monies and ensure that the rental income covererd the repayment mortgages and allow a little extra to pay for repairs! Great plan, 4-virtually free houses! If something is virtually free, who really cares what the initial purchase price is! In this instance, it is the final mortgage payment date that is important and ensuring that the figures stack up. I can probably consider myself to be one of the very first BTL investors around buying my first property in 1992. The only bank/BS willing to offer BTL mortgages was the Saffron Walden. At only 43 years of age now and am wondering what I am going to do in my retirement when the mortgages end in 2012! I'll be only 46. Oh and I only ever put £34k (For deposits) of my own money in over the whole 17-years and the properties are now worth in excess of £500k (And falling slightly). Furthermore, these BTL properties also paid off our family home 10-years ago. The BTL properties had risen sooo much that we rolled the mortgage off our family home onto the BTL's for tax efficiency reasons leaving us mortgage free. If you plan to use BTL to form part of your pension plan and never think about selling, who cares what house prices might do next year or the year after. You should be thinking 20-years + from now when they are paid off and you can quit the rat race.
  7. Perhaps in real terms it has increased. It depends on a number of things. I haven't put the rent up on one of my properties because the condition of the property is becoming progressively worse. I know that the Kitchen & bathroom are starting to look worn out, the carpets are coming towards the end of their life, yet the tenants are still happy and I keep putting these jobs off. If they ask for a new Kitchen & Bathroom, I will do it, but the rent will go up accordingly. If they won't pay the increased rent, I'll serve them with a section 20 and get someone else in on the higher rent. A friend of mine also has a rental property. He has been shagging the tenant for 3-years now and while his wife doesn't find out, he has kept the rent exactly the same. Call it payment in kind if you will!
  8. And your paying off his mortgage for him! One day it's paid off, by you, with no more mortgage payments, then watch his yield increase!
  9. You stike me as a very sad individual that is probably paying out loads of money every month for a cr@p house, that you don't actually own yourself and probably hate everyone that has it easy because they have or are playing the system? Am I right by any chance? Yep thought so. A bitter & twisted person that is better suited to living in a communist state because in a competitive world, you are simply unable to compete. What's that saying? Oh yes "The cream will always float to the top and the sh1t will always hit the floor". Go and see a shrink mate. Sort your head out, learn the system and play it for yourself. If not, give up whining about the rules of the game and accept the inevitable, you are going to die very miserable.
  10. Our company uses sealed bids after an open house has taken place! The open house (Normally on a Saturday afternoon for 2-hours) forces the buyers to view the property together at a time that suits the agent/ vendor. Buyers have been used to getting their own way over the last 18-months and this changes things around a little. Also, by forcing the buyers through the door at the same time, buyers are aware that there may be other interested parties and likely offers coming in later. Sealed bids are normally required by midday on the following Monday. Again, this forces buyers into a tight spot especially if they are used to playing it cool with the old waiting game. (Waiting for the agent/ vendor to say, "Okay, you can have it for a low price") If a buyer stays away and does not submit a bid by the required time, they could be overlooked as not interested and any other offers that come in, will be discussed with the vendor. BTW, the agent is legally not allowed to tell another buyer about your offer. They can't even indicate if one offer is higher or lower than another at the offer stage. Sometimes the two highest offers are given one final chance to increase their offer in what is known as "Best & Finals". This gives each party, one last chance to increase and then the vendor normally decides which offer, if any they are happy to accept. The vendor is under no obligation to accept anything and it is not uncommon for a property to go back on the market afterwards for conventional marketing. Lately, our firm has has a reasonable level of success with these, especially if the guide price was reduced to start with, thus attracting even more buyers. It is the agents nearest tool to holding an auction on a property, without actually putting it into an auction. Open House days with sealed bids are aimed soley at attracting the best price for the vendor. If the property is run of the mill and hasn't been priced down to start with, walk away. But if it is special, unique, individual and a great price, go along and put in a bid that you are happy with. Make sure the bid is high enough so that if you lost it, you wouldn't care, but not too high that if you got it, you would later regret it. Our firm also asks for a non-refundable deposit and the buyer is asked to put a sizable chunk of money down, plus sign a contract, before the property is removed from the market. This ties them into exchanging contracts inside 12-weeks at the agreed price and the buyer will lose their deposit if they do not meet this. Some exeptions are in the contract like: Down valuation on survey, adverse survey (Structural only), adverse searches, adverse proof of title etc. If anything like this comes up, the buyer can either renegotiate the deal or walk away claiming their deposit back! This is moving things closer to the Scottish system, but a buyer would only lose their deposit, nothing more serious. I hope this helps.
  11. Nope, you are exaggerating to problem. In 2007, the height of the housing bubble, only 10% of sales were made by BTL investors with 38% being made by first time buyers. This data has been reported here before on house price crash! (Search and ye shall find it! ) So taking these figures into account, first time buyers are more likely to compete against each other, than they are against BTL investors. Sure, a BTL investor can normally win the sale on greater purchasing power, but it has been my experience that BTL investors tend to look for bargains and lose out to first time buyers, who will often pay more than the property is really worth, whereas the BTL investor has got to make the figures stack up otherwise they can't get the BTL mortgage. I.e. The rental income must be 115% of the mortgage and it needs to survey up on rental income as well as property value. Sure leveraging can allow the BTL investor more capital to invest in other properties giving him/her greater purchasing power, but the first time buyer only needs the property to stack up on value, not value and rental potential. Our company saw loads of BTL investors lose properties on survey because they valued up on value, but not rental potential. Again, going back to my first point, there were far more first time buyers than BTL investors competing against each other than competing with BTL investors and it was overall competition that drove prices higher and higher. It has always been the case that a BTL investor needed a minimum of 15% deposit, yet FTB's were able to obtain 125% mortgages and could even self-certify with liar loans! A BTL investor's private salary was never taken into account as the whole mortgage application is based around the property in question, so no way of lying. FTB's always had the edge. I am afraid that you have read too much in the press (Probably Times Online) and have a skewed view on things. BTW, BTL investors are still buying property. Our company just missed out on a sale last Friday with one investor buying 5-properties, while there are still bargains to be had. She tried to drop our property from £90k to £78k, but the vendor rejected her offer! If BTL is so evil as it prevents other people from getting onto the property ladder, why don't all these so called prevented people buy houses now, like she is. There are plenty of cheap properties out there and first time buyers can get mortgages at the moment, as long as they have a 5% deposit! (Like it should be) In fact, there are very few other buyers out there to compete against also, so no problem. I'll tell you why not. Because they are holding off waiting for prices to go lower, while they continue to save, so please don't blame the BTL investors for buying property, because they are not stopping anyone else from buying and after all, it's a free country and they are providing low commitment accommodation for people that need somewhere to live. Options for people that won't buy, can't buy or STR's. Communists like you should p1ss off to Russia/ China and let a free democratic society take it's natural course as long as no laws are being broken. How would you like it if all rental property was banned and all tenants were forced to buy a home of their own or live on the streets? You'd be the first to complain I'm sure. Now climb back under that little rock that you climbed out of, there's a nice boy and stop proclaiming something you know nothing about!
  12. Seriously..... Fact, two days ago I went online and ordered myself a fire resistant safe! Once it's bolted firmly to the house, I'll be putting my savings in it. The 4-major banks in the UK are on borrowed time anyway. Interest rates on savings are below inflation and should they go down, the government is so far in the red, they couldn't afford to repay the lost trillions. Everyone will be broke accept those with money put to one side ready for a rainy day. Unfortunately for me, I don't have anything like the sums you have to worry about, but I did have some money in Kaupthing Edge that I managed to get out 2-days before they went under. I'm not about to make the same mistake again.
  13. You really are a t@sser aren't you! How has a BTL taken away a family fortune? A family kingdom? The BTL investor has provided a home for someone unable to buy a home of their own. Nothing has been taken away from anyone. In case you haven't left the house lately or turned on the TV, there are millions of unsold houses on the market, so your so called family has just got to venture out and they will be bombarded by for-sale boards. They can pretty much take their pick and buy anything they want. Perhaps you are one of those deluded individuals that firmly believe that BTL investors that drove up UK house prices over the last 10-years and it had absolutely nothing to do with the banks handing out cheap credit to everyone and anyone that wanted it, including first time buyers and young families that borrowed beyond their means. If the Conservatives hadn't sold off all the council houses in the 80's to the tenants that lived in them, there would still be millions of council houses available for people to rent and BTL investors would have no tenants to provide housing for. I think idiots like you should wind your neck in, go back to school and try to understand the subject, which you clearly haven't got a clue about, before opening your gob and spouting off complete cr@p. In my humble opinion of course.
  14. Not if you didn't furnish the property and let it unfurnished or furnished it with second hand furniture. No stamp duty is payable on property below £175k and the OP did say that flats could be purchased at £100k each. An unfurnished property is given a 6-month council tax exemption between lettings, but the mortgages will still need to be paid, not to mention service charges for connection to some services, but these will be minimal especially if no one is living there using these services. A BTL investor needs to buy the right property in the right area with a good return. He/she needs to have the flexibility over competition to lower rental prices if a void period looks likely. Despite what has been said here, BTL still works, but it is not very profitable in the short term. Investors need to take the long term view and forget about short term capital growth. I view things like this. If I can buy a property on a repayment BTL mortgage as apposed to an interest only mortgage and there is a sufficient rental return to cover repairs & running costs, then in 25-years the property has been bought by the tenants and I have a free house, even if the value of that property has fallen to a tiny percentage of it's original value. Free means free, so any remaining value is better than nothing and worth doing in the first place. Anything other than this is a gamble and not worth the risk at the moment. IMHO of course.
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