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Rinoa

Britannia Bs Buying Up Repos

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Anecdotal from Manks over on TMF

Had an interesting conversation this morning with an estate agent whose repossession stock is being snapped up by two organisations that are seemingly not particularly price conscious. It seems that the deals are being tied up via head office and the branches only advised after the event.

I traced the name of one companies and it turns out to be a company called Illius. Which, it turns out, is a subsidiary of Britannia Building Society.

So I gave them a call.

The chap I spoke to was very helpful and he explained to me that they were exclusively buying repossessed property. I asked whether this was mainly ex local authority stock (because that is what most repos seem to be at present), and he said they were.

They are buying them up, putting contractors in to refurbish them and letting them. They are also speaking to local authorities about long-term leases for for use as social housing.

What I take from this is that Britannia's economists may believe that we are somewhere near the bottom of the market. Perhaps, also, they think it is a way of accessing public money via housing benefit claims - the places that they are buying will tend to attract HB customers.

I also deduce that they view this as a long-term opportunity, because the cost of acquisition and refurbishment plus administration means that profit won't be immediate.

I have to say that I was very surprised - shocked even - when I heard the above, especially given the type of property they are buying. But it's from the horse's mouth.

If this becomes a large-scale operation, and / or it is being replicated by other organisations (and I have my suspicions that it is) this could have quite an impact upon the market.

Interesting times.

Manks

Interesting times indeed.

Make of it what you will.

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I wonder which lender they're (a subsidiary of the Britannia, not the Britannia itself) buying them off?

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Anecdotal from Manks over on TMF

Interesting times indeed.

Make of it what you will.

In other news - icecream saleman eats all his own icecream and reports a roaring trade :lol:

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Had an interesting conversation this morning with an estate agent whose repossession stock is being snapped up

"Snapped up"

Estate Agent

Tells you all you need to know.

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Anecdotal from Manks over on TMF

I also deduce that they view this as a long-term opportunity, because the cost of acquisition and refurbishment plus administration means that profit won't be immediate.

More fools to the slaughter.

In Jan 2007 95 percent of people thought that housing was a one way bet. They were all wrong.

Now there are numpties thinking they're getting a bargain. They're wrong.

And even if the market bottoms soon like you keep on banging on about, it certainly isn't going to be V shaped.

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SO what they paying? Are they preventing their own customers LTV sinking by propping up the markets ...

Britannia ? aint they owned by the co-op now? the ethical bank...

maybe they're just the thic bank now

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"Snapped up"

Estate Agent

Tells you all you need to know.

Yeah, probably some vehicle Britannia have set up to try to disguise the losses they are making on their bad loans. They repo someone, and lo and behold ‘Illius’ comes along and buys the repo for 1% less than the mortgage amount, thus stopping Britannia having to write off the delta between the mortgage and the eventual auction sale amount......

Perfect timing, because there is a shortage of rental properties right now........

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SO what they paying? Are they preventing their own customers LTV sinking by propping up the markets ...

Britannia ? aint they owned by the co-op now? the ethical bank...

maybe they're just the thic bank now

Agreed.

More importantly, if prices fall, the value of the assets backing their loans falls and affcts their balance sheets.

This cna't go on forever though... eventually as prices drop it will backfire.

There is a huge mass of water building up behind the floodgates... all these litte deals and underhand coverups.

The more they let it build up, the bigger the catastrophe will be when the gates break.

Maybe they everyone is hoping that if the threat gets big enough they will get bailed out....somehow....

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Yeah, probably some vehicle Britannia have set up to try to disguise the losses they are making on their bad loans. They repo someone, and lo and behold ‘Illius’ comes along and buys the repo for 1% less than the mortgage amount, thus stopping Britannia having to write off the delta between the mortgage and the eventual auction sale amount......

Perfect timing, because there is a shortage of rental properties right now........

Don't say delta you ****.

It's brand new to management shit speak bingo.

Just the deltas ya.

****** off you pretentious ****

here endeth the rant

Edited by GrillsBears

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Erm, a company as a subsidiary of a mutual, and buying property? Doesn't that ring alarm bells?

If there's any truth in the story, the "britannia" in question is more likely to be this.

[edit] Hmmm, HPC search is broken, and that link doesn't work. Here's another: http://www.housepricecrash.co.uk/search.ph...ISO-8859-1#1001

Edited by niq

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without knowing the prices paid, and the housing type, it would be a pretty bad idea to assume that it is anything other than a good deal for them.

if their yield on the rent is good enough, there is no reason for them not to be doing it.

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didnt a Mr R Maxwell Pioneer the using of company funds ( well pensioners funds) to support prices.....

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I remember in the 1960s, there used to huge organizations called Housing Authorities, which owned large swathes of urban Britain and rented the housing on them to social tenants. These houses were referred to as council houses, and the Authorities that owned them were massive tax-payer funded social welfare providers. These Authorities were largely dismantled under the 1979 Conservative government. They are now back, and we are calling them "banks".

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If the Britannia Building Society is buying repos then it seems to be an incredibly risky strategy. Unless the Britannia has sufficient funding to cover any losses through default and the bottom of the housing is in then the Britannia is doing nothing more than doubling-up on a losing gamble.

If it's an attempt to support house prices then the Britannia will find out that the truism 'You can't buck the market' is just that - true.

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Don't say delta you ****.

It's brand new to management shit speak bingo.

Just the deltas ya.

****** off you pretentious ****

here endeth the rant

I have been working for a large American company for 9 years. The expression 'delta', used in the context of describing the difference between two amounts, has been in use as long as I have worked there.

It seems that it is an expression that you have heard for the first time recently.

Which makes you come across as rather slow and backwards.

****** off you retarded ********* :lol:

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It's been used in maths & physics for generations. To be fair, it is usually considered a bit vvanky to drop it into normal conversation when you could just say "difference" ;)

edit: maybe physicists are just more reticent

Edited by Mal Volio

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It's been used in maths & physics for generations. To be fair, it is usually considered a bit vvanky to drop it into normal conversation when you could just say "difference" ;)

Just to add that in "physics speak" its a logical term because a difference is described by the greek letter "delta"

(like this: http://sub.allaboutcircuits.com/images/13027.png)

Edited by Emlyn

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It's been used in maths & physics for generations. To be fair, it is usually considered a bit vvanky to drop it into normal conversation when you could just say "difference" ;)

edit: maybe physicists are just more reticent

scientists say "difference" when they speak science

the delta sign is only used as a written notation

first time I've heard of it being used in management speak - complete nobsters

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Ok,now I'm confused. I thought the whole point of building societies was to allow other people to buy houses- not buy houses themselves. Talk about cutting out the middle man :blink:

It's hard to escape the conclusion that all this clever engineering of the market place is going to make the whole thing worse.

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