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Realistbear

Multiple Home Owners Are Redesignated By The Telegraph As:

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http://uk.finance.yahoo.com/news/budget-2010-cgt-changes-will-hit-vast-majority-of-property-investors-tele-982c0d9d7972.html?x=0

It (new 28% CGT rate)
will catch all those hard working families who opted for a second home
often as an alternative to risking their pension planning in equities. The new system will mean lumpy gains from sales of large assets will push those on lower incomes into the higher 28 per cent CGT bracket."

We live in a very sick society.

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http://uk.finance.ya...9d7972.html?x=0

It (new 28% CGT rate)
will catch all those hard working families who opted for a second home
often as an alternative to risking their pension planning in equities. The new system will mean lumpy gains from sales of large assets will push those on lower incomes into the higher 28 per cent CGT bracket."

We live in a very sick society.

The point that is coming out of the woodwork more and more is that these people bought property to protect themselves from inflation.

And who can blame them, in a way they did the right thing.

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The point that is coming out of the woodwork more and more is that these people bought property to protect themselves from inflation.

And who can blame them, in a way they did the right thing.

2 words:

Business Risk

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Realistbear - any chance that in future you can post links to the original article (which appeared in the Telegraph website) rather than linking to Yahoo (which is just a news aggregator).

That way HPCers can add their pearls of wisdom to the comments section at the end of the article :)

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At the moment I have about 3 years of "gold plated final salary public sector pension" from a few years ago and nothing else.

I'm now self employed so have no employers scheme I can join.

So my choice is either (1) do nothing (2) invest in a sipp and eventually buy a fixed income product (3) BTL

Of the choices BTL seems to make the most sense, it produces a yield no worse than the cash rate, it rises with inflation and I have the option of cashing it in for a lump sum if ever required.

I agree that economically it is a terrible waste and I should be investing in productive companies instead. However the FTSE is still below where it was 10 years ago and so many companies suddenly go bust wiping out investors and it would be for my pension so I wouldn't take too big a risk....

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The point that is coming out of the woodwork more and more is that these people bought property to protect themselves from inflation.

Or to put it another way, they did it to make money

And who can blame them, in a way they did the right thing.

This depends on whether you consider that the victims of the behavior have any rights

Edited by Stars

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http://uk.finance.ya...9d7972.html?x=0

It (new 28% CGT rate)
will catch all those hard working families who opted for a second home
often as an alternative to risking their pension planning in equities. The new system will mean lumpy gains from sales of large assets will push those on lower incomes into the higher 28 per cent CGT bracket."

We live in a very sick society.

Disgusting!

You earn over £37,401 a year you pay higher rate tax at 40% ...if you ask me these 2nd home owners selling up are still benefiting from a tax relief of 12%.

Why should people with standard pensions be taxed as workers, and have to sit there and watch people with 2nd homes (and no real pension) hardly pay anything!?

Hard working families? Many hard working families cannot even afford one property, let alone two! A lot of the people who do have 2nd homes have just been lucky, not lifting a finger and watching their first homes at least double in value over the past 10 years!

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it produces a yield no worse than the cash rate, it rises with inflation and I have the option of cashing it in for a lump sum if ever required.

as generalisations these are all wrong - you haven't thought this thru'?

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Disgusting!

You earn over £37,401 a year you pay higher rate tax at 40% ...if you ask me these 2nd home owners selling up are still benefiting from a tax relief of 12%.

Why should people with standard pensions be taxed as workers, and have to sit there and watch people with 2nd homes (and no real pension) hardly pay anything!?

Hard working families? Many hard working families cannot even afford one property, let alone two! A lot of the people who do have 2nd homes have just been lucky, not lifting a finger and watching their first homes at least double in value over the past 10 years!

+1

Hard working??

[Ring ring]

Reckless Lender: "Good afternoon, Royal Bank of Scotland."

Reckless Borrower: "Hello. Can I have a load of BTL mortgages please."

Reckless Lender: "Certainly, sir. I'll send the paper work out in the post."

Reckless Borrower: "Thank you".

[Click]

I suppose us young 'uns, us what with our internet and phones and ipods, just aren't working hard enough. Funny, because my parents paid off their mortgage on a single, low paid salary. My partner and I can't even get a mortgage despite BOTH working full time and earning above the national average.

We don't know we're born... apparently.

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Disgusting!

You earn over £37,401 a year you pay higher rate tax at 40% ...if you ask me these 2nd home owners selling up are still benefiting from a tax relief of 12%.

Why should people with standard pensions be taxed as workers, and have to sit there and watch people with 2nd homes (and no real pension) hardly pay anything!?

Depends how you look at it. Earnings are (for the vast majority of people - pop stars & footballers etc excepted) spead over the years. The 2nd home owners are getting hit for the full gain in one tax year.

Donkeys years ago (when my tax knowledge ran out) there used to be something called "topslicing relief on premiums" so if you sold a lease the tax was worked out on what it would be if the gain were spread out over the relevant number of years (nightmare to work out; pretty sure it got ditched eventually).

From this point of view the 28% is a reasonable average between the basic rate the vendor (who may well be retired) would normally pay, and the 40% s/he would be hit with if it were all just added on to income in one year, as happened up till a couple of years ago.

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At the moment I have about 3 years of "gold plated final salary public sector pension" from a few years ago and nothing else.

I'm now self employed so have no employers scheme I can join.

So my choice is either (1) do nothing (2) invest in a sipp and eventually buy a fixed income product (3) BTL

Of the choices BTL seems to make the most sense, it produces a yield no worse than the cash rate, it rises with inflation and I have the option of cashing it in for a lump sum if ever required.

I agree that economically it is a terrible waste and I should be investing in productive companies instead. However the FTSE is still below where it was 10 years ago and so many companies suddenly go bust wiping out investors and it would be for my pension so I wouldn't take too big a risk....

Which kind of brings us back to the point that some of the more "abstract" thinkers on this board are always banging on about: the fundamental problem is a "credit bubble", too much savings sloshing around the system, and the only way to get any return on these savings is to plough them into something where you have supply-side restrictions: e.g. land* or energy**

The more I read the posts here, the more the problems seem to all become interlinked :(

* because that's basically what investment in houses is about.

** witness the good dividends of BP.

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Which kind of brings us back to the point that some of the more "abstract" thinkers on this board are always banging on about: the fundamental problem is a "credit bubble", too much savings sloshing around the system, and the only way to get any return on these savings is to plough them into something where you have supply-side restrictions: e.g. land* or energy**

It depends what you mean by fundamental - If you solve the credit problem then you will not solve the supply issue, however if you solve the supply issue then the credit doesn't matter anymore

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At the moment I have about 3 years of "gold plated final salary public sector pension" from a few years ago and nothing else.

I'm now self employed so have no employers scheme I can join.

I guess You chose to be self-employed. Hope the choice was an informed one.

So my choice is either (1) do nothing (2) invest in a sipp and eventually buy a fixed income product (3) BTL

A couple of pros & contras which immediately spring to mind

(2) Your SIPP contributions are topped up by govt up to your tax amount paid in that particular year. If You want property exposure, buy REITs with your SIPP money.

(3) You can buy BTL only with after-tax money but You can gear. However, you have to pay tax on BTL profits after mortgage interest/maintenance/agent fees/etc.

Of the choices BTL seems to make the most sense, it produces a yield no worse than the cash rate, it rises with inflation and I have the option of cashing it in for a lump sum if ever required.

Gross yeild - possibly. Net yeild - I doubt that. And cashing in means paying CGT.

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http://uk.finance.yahoo.com/news/budget-2010-cgt-changes-will-hit-vast-majority-of-property-investors-tele-982c0d9d7972.html?x=0

It (new 28% CGT rate)
will catch all those hard working families who opted for a second home
often as an alternative to risking their pension planning in equities. The new system will mean lumpy gains from sales of large assets will push those on lower incomes into the higher 28 per cent CGT bracket."

We live in a very sick society.

Where would you suggest is a good place now to save for old age? The stockmarket, bank. Its ok to knock ordinary people who did this, but most wrere only trying to help themselves in old age.

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Where would you suggest is a good place now to save for old age? The stockmarket, bank. Its ok to knock ordinary people who did this, but most wrere only trying to help themselves in old age.

The circular rationale again

There are no proper returns on production precisely because people are using to housing to screw over production

Please take a moment to visualise this

Edited by Stars

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Where would you suggest is a good place now to save for old age? The stockmarket, bank. Its ok to knock ordinary people who did this, but most wrere only trying to help themselves in old age.

Cash. If you believe deflation is next for a few years. If it is inflation then the only place is property I am afraid.

Stocks: can't see how all the troubles have evaporated without some real pain in Stocks.

Old age does not mean you have to stop working--pension age is being moved up and we may end up chasing the carrot without ever getting a taste. Its only in the last century that people thought they had a right to retire and do owt. HPI and the new property poverty that rules our economy means you have to work longer for less and have your spouse do likewise. After all, how else are we going to afford those very expensive houses?

We are a nation addicted to HPI--our quality of life has sunk to the floor because of it and yet most do not see it. House poverty pervades everything we do. It sucks the productive sector dry and no greater example of this exists than California who invented economy destroying HPI.

"Ordinary people" and "hard working families" are the serfs of the modern era. The cause: property poverty. We work harder BECAUSE of HPI. We are ordinary because of HPI. I tell ye, HPI is the worst disease known to man.

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The circular rationale again

There are no proper returns on production precisely because people are using to housing to screw over production

Please take a moment to visualise this

100% correct.

HPI has become the substitute for effort.

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I wouldn't criticise people for buying a BTL to fund their pensions, it looked the rational thing to do over the last couple of decades. However, I do wish they'd stop winging about paying tax on their windfalls, should they choose to sell the place. I have a feeling that half of them aren't declaring the rental income fully, either.

Maybe HMRC have been told to look for more money from the BTL brigade, who are now starting to panic over their undeclared liabilities, and thinking of selling up. Let's hope so.

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I wouldn't criticise people for buying a BTL to fund their pensions, it looked the rational thing to do over the last couple of decades. However, I do wish they'd stop winging about paying tax on their windfalls, should they choose to sell the place. I have a feeling that half of them aren't declaring the rental income fully, either.

Maybe HMRC have been told to look for more money from the BTL brigade, who are now starting to panic over their undeclared liabilities, and thinking of selling up. Let's hope so.

Agree. Brown's Ponzi HPI driven economy forced it on a lot of folk as he robbed their pensions and debased just about everything else. Brown created the one trick pony and it wasn't "services" it was HPI.

This is why the Koalishon dare not touch it lest it fall and destroy us. We are now in the position that HPI is TOO BIG TO FAIL.

It created too much: LIAR LOANS, innovative financial products (ETFs, CDOs etc,) it enslaved too many (MPs) it pays too many too much (Banksters), it is the god of the financial world and it determines our every move.

In the end it WILL destroy us. Unless we get it first and so far, the will to do so is not there.

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I wouldn't criticise people for buying a BTL to fund their pensions, it looked the rational thing to do over the last couple of decades. However, I do wish they'd stop winging about paying tax on their windfalls, should they choose to sell the place. I have a feeling that half of them aren't declaring the rental income fully, either.

Maybe HMRC have been told to look for more money from the BTL brigade, who are now starting to panic over their undeclared liabilities, and thinking of selling up. Let's hope so.

It might well have been a good thing to do from a purely selfish point of view, but then so can mugging someone for their cash.

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I think a CGT on 2nd homes is 100% the right thing to do. I appreciate the frustration of people trying to make their money work better for them. But the practice of using homes as a replacement for pensions and savings has been at the expense of people in their 20s (and 30s) being able to afford to get onto the property ladder.

It has been far too easy an option to make very easy money for too long, which is why so many people have been buying the second homes, which has in turn driven prices up and put is into the situation we are in now. It is not the fault of 2nd home buyers, as anyone with the financial means will naturally invest in whatever gives them the highest returns. Therefore, the only means of controlling the situation is to tax 2nd homes to make the prospect less appealing. It is not a bad thing if house prices come down and people who are starting out in life can again be in a position to buy for themselves.

There are enough things you can invest your money in, without pricing your children out of the housing market. We should aim to let homes be homes again and not financial commodities to be speculated on to make some easy money.

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I think a CGT on 2nd homes is 100% the right thing to do. I appreciate the frustration of people trying to make their money work better for them. But the practice of using homes as a replacement for pensions and savings has been at the expense of people in their 20s (and 30s) being able to afford to get onto the property ladder.

It has been far too easy an option to make very easy money for too long, which is why so many people have been buying the second homes, which has in turn driven prices up and put is into the situation we are in now. It is not the fault of 2nd home buyers, as anyone with the financial means will naturally invest in whatever gives them the highest returns. Therefore, the only means of controlling the situation is to tax 2nd homes to make the prospect less appealing. It is not a bad thing if house prices come down and people who are starting out in life can again be in a position to buy for themselves.

There are enough things you can invest your money in, without pricing your children out of the housing market. We should aim to let homes be homes again and not financial commodities to be speculated on to make some easy money.

a fine maiden speech. [i'm not saying I agree with it, mind, (for the benefit of scepticus below since I wouldn't wish to be allocated to the wrong 'camp')]

Edited by cheeznbreed

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I'm enjoying seeing the previously united break ranks. Seems we now have two camps.

Both camps hate brown but it turns out only one of them hates VI property ramping second home ownersTM.

Some complex psychological sh*t, self delusion and cognitive dissonance going on here. Still, got to pin that tail on a donkey, even though you ave no actual idea who it was that kicked you in the first place.

Dumb and dumber.

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  • 261 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%



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