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House Price Crash Forum


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Everything posted by dgul

  1. They've 21 years to chase up unpaid SDLT (and 8% interest) - just ask the bank for the money. If they don't pay up just take possession of the property. [there is clearly an ambiguity on SDLT and 'islamic mortgages' - I understand that the property belongs to the bank, but surely with the current rules there would need to be a SDLT transaction on the handing over of the property at term?] I find it odd that normal people who buy a normal house will be chased up over a few (10s of) £K, but when it comes to multimillion £ transactions they become forgetful.
  2. I thought that about 2004. IMO this is no longer true - there are too many people with too much money who would just soak up property if prices went down. We could probably do with a crisis which reduces everyone's unearned wealth, while supporting ongoing labour / value creation. A currency crisis would do it. Even then, worldwide cash would flow in... And they will do anything to support property - even if there was a currency crisis they'd not increase interest rates (much, anyway).
  3. The FTSE isn't a stable representative sample of publicly listed companies - it contains whatever are the biggest 100 publicly listed companies. it is biased towards inclusion of companies / industries which are growing, and exclusion of companies / industries which are shrinking. At one level this is kind of balanced (companies grow after inclusion, shrink just before exclusion), but the imbalance is enough to account for the deviations you observe.
  4. You can't just hate all pensions, disagree with all people with pensions as troughers. These people did a job with a set of benefits. A big part of this was salary, but there were others - pension being an important one. When you get a job you weigh up all of these benefits - The Tata employees were willing to take the job based on this package of benefits - a commercial arrangement. If they offered RPI then that was a positive compared with other jobs which only offered CPI. Going against this is a breach of contract. I appreciate that the fund is in trouble, but this isn't a good thing in any way.
  5. This could be readily resolved by having progressive property taxes - at the moment the maximum holding tax (council tax) of an investment flat in London is about £2000 a year. Compare this to New York, where property tax is about 0.8% of value, or San Francisco at over 1%. Property tax at about 1% wouldn't make too much difference to most people, but the £500k a year it would cost to keep the penthouse in that high-rise block might at least bring the cost of hiding cash in the form of London apartments into line with other favoured areas to hide cash.
  6. The funny thing is the vast majority of landlords started by equity withdrawal from their residential property (via HPI), and then expanded the empire using equity withdrawal from their other rental properties. What's more, I dare say that saving 20% of £80k to buy your first property is considerably easier than saving 20% of £250k - even if the monthly (interest) payments are similar due to the low interest rates of today. The saving 20% these days isn't far off the oldies saving enough to buy outright (and in those days they'd have had a decent interest rate on their savings, as well).
  7. I agree. The policy seems to be to discourage BTL (while getting a bit more in tax from the ones that stay), but encourage OO. IMO we've not seen anything yet - the big OO supporting policies are yet to come...
  8. Not quite the same but I remember 30 years ago in Greece a popular way to build was to build the first floor of your home and move in, leaving the rebar pointing to the sky. Then, when the children come along and you've saved up a bit, build the next floor. Complete at your leisure. However, IIRC this was more to do with taxation than simply spreading the build costs.
  9. Looks okay. The colour change is just what happens to that type of wood after a few years. Their main problem seems to be with the heating - there seems to be some sort of biomass heating which takes some maintenance. For a luxury holiday let you should just get something reliable and price the costs into the rental fees.
  10. Maybe, but they could also not offer the loan, or offer it at different rates. Remember, when taking out a personal mortgage your credit history is checked, and they might not offer the mortgage (or increase rates) if your history isn't good enough - the LtdCo isn't you, it is a separate entity, and they might not offer it the loan even if you as an individual might be okay. Also, the director guarantee might be more than for a normal BTL mortgage (equivalent £ at risk).
  11. Maybe - but people are stupid when it comes to memory. Vast numbers of people have now forgotten 'Russia = enemy in cold war', and are now 'Russia = pretty girls', with a little sprinkle of 'Russia = wealthy oligarchs' every time Litvinenko is mentioned.
  12. I think this is likely to happen soon. eg, small company, borrows £1m to invest at 0% (in allowable project types), gets £50k pa over the loan lifetime as cashback from gov (as tax rebate, but with possibility of payment if the co. isn't paying that much tax).
  13. I'd add that I don't think many current BTLs have the level of financial discipline to run BTL - if they have a tight month (or a particular need) I bet a good proportion would just take the cash out of the LtdCo account without any accompanying paperwork. HMRC is going to have more work to do re. audits come 2020.
  14. Sorry to edit out most of your post (quite long). I'd say: Just because LtdCo mortgages exist doesn't mean that they're offered. I'd say the banks are very much aware of the different risks associated with LtdCo and change their offering accordingly. I doubt they'd offer me one at all. LtdCos are separate legal entities - it is very difficult to manipulate the law around these in any way without changing the law for all. Frankly I'd be happy for all BTLs to be treated as LtdCo - they might win back their old tax deductibility arrangements, but the fact that they'd have to submit full tax returns would make a huge difference. Taxation would be about the same as it is now, plus the new dividend tax rate, so there wouldn't be any immediate gains re. tax efficiency. And they'd all be treated as professional business people (which they seem to want all along) - with all of the resultant losses of consumer protection and increased bank costs.
  15. You never done lambing? Too much like hard work for most people, especially with the weather round there.
  16. I think they might demand animal husbandry skills, ecology skills and tourist management skills - that should reduce the number of applicants who are actually considered. It is only 140 acres (albeit with additional grazing rights) - that isn't going to give a fantastic income... And a 10 year tenancy - so as soon as you've sorted the place out and started to really make a living you'll get removed because they'll have decided to do something 'innovative' with the place.
  17. I don't think we'll see more hits to BTL any time soon, beyond those which are being baked in. At least nothing before 2021 I'd say the likelihood is more that if there was any significant hit to prices they'd introduce supportive measures for OO.
  18. I think in the vast majority of cases if they put the property up for sale at the price they bought it for they'd sell in an instant. There is always a price at which something will sell - they're just not willing (or motivated) to try to find it.
  19. We could have had that on page 1 of the thread and saved ourselves a lot of typing.
  20. The British masses are so focussed on property that they can't see reality any more. It sounds tongue-in-cheek but the initial thoughts with so many people really will be 'great - sit on the asset for x years and I'll be able to retire on the proceedings'. Funny article - 500 miles east! 5,000 miles more like.
  21. I'm not sure it is priced in. It would be minor compared with the impact of Brexit on the £ (in the short term)
  22. I think they're right. The whole BTL thing is so deeply entrenched now - logic doesn't come into it. I think in about 20 years time there'll be loads of investors looking back and saying 'well I suppose I get an income from it, but it didn't do as well as I expected, and it was hard for a few years', not even realising then that they'd have been better off just putting money in the bank (let alone investments). That's not to say that I don't think prices will fall - it will just be 20 years of year on year gradual decline with a new set of bottom pickers thinking they're getting a bargain each year.
  23. Well, to throw it around the other way, what % pop in the pound (and thus drop in Au in £) would we expect if the country votes Bremain?
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