Jump to content
House Price Crash Forum

Recommended Posts

More on the CGT changes the coalition are working on introducing. I know this has already been discussed extensively but thought the survey indicating that large numbers of Financial Advisors are planning on advising clients to get out of BTL and/or avoid BTL as an investment. See:

http://www.yourmortgage.co.uk/news/3626786

And from the article:

"A survey carried out by financial technology company 1st Exchange indicates that 60% of financial advisers are already planning to move their customers away from assets attracting CGT, including buy-to-let property. "

The article goes on to include quotes that whine about how unfair it all is .........hmmmm, never heard any BTL'ers acknowledging the unfairness of a generation of young adults being priced out of buying a 'home'.

Edited by Alfie Moon

Share this post


Link to post
Share on other sites

More on the CGT changes the coalition are working on introducing. I know this has already been discussed extensively but thought the survey indicating that very large numbers of BTL'ers are thinking of selling up was interesting. See:

http://www.yourmortgage.co.uk/news/3626786

And from the article:

"A survey carried out by financial technology company 1st Exchange indicates that 60% of financial advisers are already planning to move their customers away from assets attracting CGT, including buy-to-let property. "

The article goes on to include quotes that whine about how unfair it all is .........hmmmm, never heard any BTL'ers acknowledging the unfairness of a generation of young adults being priced out of buying a 'home'.

but im sure i heard all the bulls arguing for the last couple of years that property cant crash because everyone will just be piling into it, taking advantage of the low prices (along the lines of "if property falls, i for one will be buying loads and everyone else will act the same way stopping a crash"), when it was highlighted conditions and rules will change to make that argument ludicrous it was laughed at and yet here we have FAs telling clients not to buy property..

This doesnt compute

Share this post


Link to post
Share on other sites

but im sure i heard all the bulls arguing for the last couple of years that property cant crash because everyone will just be piling into it, taking advantage of the low prices (along the lines of "if property falls, i for one will be buying loads and everyone else will act the same way stopping a crash"), when it was highlighted conditions and rules will change to make that argument ludicrous it was laughed at and yet here we have FAs telling clients not to buy property..

This doesnt compute

This has always been a stupid argument. If it were true no Market would ever crash! There will always be buyers 'piling' in at every point of a crashing Market but those buyers will be massively outnumbered by sellers.

Share this post


Link to post
Share on other sites

This has always been a stupid argument. If it were true no Market would ever crash! There will always be buyers 'piling' in at every point of a crashing Market but those buyers will be massively outnumbered by sellers.

I think the point with housing is that it wont crash down to zero because of this effect, not that it wont crash from an inflated value back to a "normal" value.

tim

Share this post


Link to post
Share on other sites

If FAs start spreading the word and are in the opinion that BTLs are a high risk and not a safe and profitable investment, lenders up the anti on the rates and taxes become onerous....bye bye BTL. ;)

Share this post


Link to post
Share on other sites

Good find ...

Mark Dampier, head of research at the independent financial adviser Hargreaves Lansdown, said:

“Very few people will want to take the hit at 40%. If the decision is made to introduce it at that level at the start of the next tax year, people will be driven to take their gains on shares and property.

“It is a tax on envy. Everyone thinks that anyone with any money has a right to be robbed. It is a bad policy.

“It is grossly unfair and it is a complete mess. People are trying to make a long-term investment decision, not a tax decision.”

Experts have warned that a mass sell-off of buy-to-let property could worsen the current shortage of available private rented accommodation, and lead to further increases in average rents as demand strongly outstrips supply.

Children, remember this, it's envy!

Share this post


Link to post
Share on other sites

Good find ...

Children, remember this, it's envy!

Yeah! And this 'envy' manifests itself through crap work, crap wages, extortionate rent, high debt and poor community spirit.

If only the older/richer generation had more time to engineer a fairer society. :rolleyes:

Share this post


Link to post
Share on other sites

Yeah! And this 'envy' manifests itself through crap work, crap wages, extortionate rent, high debt and poor community spirit.

If only the older/richer generation had more time to engineer a fairer society. :rolleyes:

It annoys me how they all seem to think they have been to hard done too. They have riggen the crest of an idiot boom in prices, surely they all remeber the crash of the 80's so falling prices and increasing taxes should not be a surprise.

I owuld love to see them all exposed to the realities of a young couple in their 20's on average wages and hoping to start a family soon. Like the poor saps on LLL this past week for 'only' £50 a month extra on their mortgage they could buy a dream home that is actually going to require them both to work their arses off to pay the mortgage and that is before even considering on of them needing to take time of to have and care for a child. 30 years ago a single salary would have secured the same place as the young couples of the day were not competing with cash rich owners/investors who have forced prices up.

Edited by lulu

Share this post


Link to post
Share on other sites

I live in a block of flats, I have seen a growth in pensioners taking on BTL over the last 2 years due to low annuity and bank interest rates. Maybe the CGT effects the chancer's but to others they are in it just to get a stable income that has some link to wage inflation. People in their 90's know all about wage inflation, private pensions got them jack in the end certainly a 4 pack of tinned tuna a week in todays money... just. So its easy to see why the 60+ want something more than just an annuity.

Share this post


Link to post
Share on other sites

I live in a block of flats, I have seen a growth in pensioners taking on BTL over the last 2 years due to low annuity and bank interest rates. Maybe the CGT effects the chancer's but to others they are in it just to get a stable income that has some link to wage inflation. People in their 90's know all about wage inflation, private pensions got them jack in the end certainly a 4 pack of tinned tuna a week in todays money... just. So its easy to see why the 60+ want something more than just an annuity.

They will be very disappointed.

BTL will be a massive headache to someone who is wanting to wind down and retire.

Share this post


Link to post
Share on other sites

More on the CGT changes the coalition are working on introducing. I know this has already been discussed extensively but thought the survey indicating that large numbers of Financial Advisors are planning on advising clients to get out of BTL and/or avoid BTL as an investment. See:

http://www.yourmortgage.co.uk/news/3626786

And from the article:

"A survey carried out by financial technology company 1st Exchange indicates that 60% of financial advisers are already planning to move their customers away from assets attracting CGT, including buy-to-let property. "

The article goes on to include quotes that whine about how unfair it all is .........hmmmm, never heard any BTL'ers acknowledging the unfairness of a generation of young adults being priced out of buying a 'home'.

Look at the "social argument" their lobbyists are using. As if a FTB buys a flat, you wouldn't have also one less tenant in the market:

Experts have warned that a mass sell-off of buy-to-let property could worsen the current shortage of available private rented accommodation, and lead to further increases in average rents as demand strongly outstrips supply.

The spinning b@stards

Share this post


Link to post
Share on other sites

Quick question I hope someone could answer.

If your landlord is domiciled outside the UK are any profits made on the sale of property inside the UK subject to CGT?

I ask as my landlord is outside the UK, I would buy this house if it were for sale although it would currently be about 25 - 30K outside of my budget and that amount has the potential to eclipse a non index linked CGT liability as he has owned the place for a very long time. I'm thinking there might be an incentive for him to sell it to us now at a knock down price.

I acknowledge that buying now is probably a bad idea however a significant part of our deposit came from HPI so I think we could be comfortable with it disappearing with HPC as kind of karma. Could be squandering a good position that by luck we have found ourselves in but getting the timing right and a suitable place being available may well not happen (ruled by school catchment)

Share this post


Link to post
Share on other sites

"A survey carried out by financial technology company 1st Exchange indicates that 60% of financial advisers are already planning to move their customers away from assets attracting CGT, including buy-to-let property. "

Doesn't imply anything more than a rebalancing.

Share this post


Link to post
Share on other sites

CGT is noise in all this. 3 years ago you paid 40% on the sale of a BTL property, it is only in the last 3 years that we've had the aberration of 18% CGT. This is merely a convenient moment for the advisers to say "get the hell out" while not admitting that the real problem is that the market is totally overblown and about to reverse.

I would say that in the long run CGT is not an incentive to sell at all. If you have an asset with a lot of profit baked in, that is yielding X, then you sell it and give a big chunk of the money to HMRC....then whatever you do with the remainder has to yield 2X (or so) to keep the income the same.

Share this post


Link to post
Share on other sites

The most interesting thing here is the potential for "top-slicing" the rentals market.

A glut ahead of CGT. A batch of new FTBs taking advantage of that and stamp-duty holiday. Suddenly the profile of the rentals market changes, as the pool of available tenants beyond the regular transient/young population (core sharer market) is much more concentrated amongst long-term benefits claimants, and oddballs like HPC posters.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 259 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.