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cybernoid

Rents Set To Surge As New Buyers Struggle To Find Mortgages

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http://www.telegraph.co.uk/finance/economics/houseprices/7967272/Rents-set-to-surge-as-new-buyers-struggle-to-find-mortgages.html

The number of brokers saying rents increased in the three months to July exceeded those reporting declines by 27pc, a survey published by RICS found. In the previous quarter, 30pc more reported increases than drops.

“Continued difficulty in securing mortgage finance, worries over a double dip in housing and large deposits required by lenders are leading to higher numbers seeking to rent rather than buy,” RICS said in the statement.

A third more respondents predicted higher rents overall in the next quarter than those who forecast a decline, RICS found, while demand for house rentals outstripped that for flats.

Borrowers have been struggling to secure significant deposits of at least 25pc to secure the best mortgages rates. They are also concerned about making large financial commitments amid widespread job insecurity in the fragile economic recovery and the rising cost of living as inflation escalates.

Banks have restricted loans for buy-to-let transactions, reducing the number of rental properties entering the market, and landlords are showing little appetite for selling properties after tenants move out.

The number of mortgages approved in the UK dropped for the second month in a row in July to hit a five-month low, the British Bankers’ Association revealed on Wednesday.

Home loans slid 2.5pc from the previous month to 33,698 – or just 1,000 a day. The total is down 18.5pc from a year earlier.

I really don't understand this thinking, supply and demand has to operate within the limits of affordability, surely? Where do landlords overpricing their rentals think the money is going to come from? This is renting, which is based on actual affordability, not buying, based on insane lending.

How can rents rise without rising salaries? Do property debtors actually believe that the renters are going to pay off their ludricous loans for them?

THERE IS NO MONEY!

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It doesn't make happy reading though does it.

We're all going to be squeezed. Rents go up, so people look to the mortgage market again. But if interest rates go up, and house prices are silly anyway, where do you turn?

Add to the fact that VAT will be going up to 20%, people losing their jobs... I'm really not sure which way things are going. Can't afford to buy OR rent, prices going up, people losing jobs...

Makes for grim reading.

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It doesn't make happy reading though does it.

We're all going to be squeezed. Rents go up, so people look to the mortgage market again. But if interest rates go up, and house prices are silly anyway, where do you turn?

Add to the fact that VAT will be going up to 20%, people losing their jobs... I'm really not sure which way things are going. Can't afford to buy OR rent, prices going up, people losing jobs...

Makes for grim reading.

It's a very difficult, unsettled, in between phase. Northing is clear, but rents which cannot be afforded will not actually be paid will they? As property prices fall, the position will alter and bring rents down with it. This current upward pressue is not that strong and will not last. The BTL firesale has barely begun. When IR's rise and the whole property market has to revalue itself, you will see a big change.

Edited by plummet expert

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My rent has been reduced today, I will be requesting a further reduction in rent.

My theory is, if you request a rent reduction, your more likely to get it, than if you don't.

And you would think, seeing as my rent is covered by the state, I wouldn't care how much it is.

You need to get active people.

Request or demand, increased wages/benefits and lower rent.

The boss and landlord, even the state profit massively at your expense.

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My rent has been reduced today, I will be requesting a further reduction in rent.

My theory is, if you request a rent reduction, your more likely to get it, than if you don't.

And you would think, seeing as my rent is covered by the state, I wouldn't care how much it is.

You need to get active people.

Request or demand, increased wages/benefits and lower rent.

The boss and landlord, even the state profit massively at your expense.

I demand lower benefits.

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For a single person, rents are too high. Looking at the cheap end of the market, 1-beds, just the rent is massive ... a couple scores as they only pay half each, so they either get nicer places or can still afford the 1-bed LHA rate. Hard working singles on low pay (low because so many people get top ups that employers no longer pay living wages) are stuffed.

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This is why a lot of parents still have kids at home, cr8p wages coupled with high rents mean kids have little chance of flying the nest at the tender young age most of their parents did.

Loads of my frieinds have had their brood go to university then return home to poor employment prospects.

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We've got 2 kids, can't afford a mortgage, and rents are going up. What choice do we have? We have to pay the higher rent (took me 3 months to find a house we could afford) and will be left with nothing at the end of the month - we both work full time, so have full time nursery fees to pay for as well. It makes you wonder what the point of it all is. Life is ****

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It's a very difficult, unsettled, in between phase. Northing is clear, but rents which cannot be afforded will not actually be paid will they? As property prices fall, the position will alter and bring rents down with it. This current upward pressue is not that strong and will not last. The BTL firesale has barely begun. When IR's rise and the whole property market has to revalue itself, you will see a big change.

absolutely....can't pay, unable to pay.....if you were a landlord, would you honestly have the cheek to try to increase the rent knowing you might lose a good paying tenant knowing they have not had a pay rise and knowing that the price of food fuel and utility costs have increased....no I don't think so. ;)

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absolutely....can't pay, unable to pay.....if you were a landlord, would you honestly have the cheek to try to increase the rent knowing you might lose a good paying tenant knowing they have not had a pay rise and knowing that the price of food fuel and utility costs have increased....no I don't think so. ;)

actually yes, fck em tenants are scum, in fact id not only double the rent id invoke Prima Nocte

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I demand lower benefits.

And my collective entity will wreak havoc upon thee, smite you and your empire, and rob you of all of your possessions. If ye give not to the poor, nor provide them meaningful work, they'll become your enemy, wrt to the state, an enemy within.

I demand meaningful work for us all, and higher wages for those doing meaningful work. Less exploitation of the workers will benefit all of us (bar those whom are too greedy/exploitative), especially the workers who generate the wealth and get such a raw deal, they envy those with the least.

As it stands, benefits are far far cheaper than jail. Cutting benefits is way too expensive.

When meaningful work could be done, paying them wages instead of benefits, it is also a waste of money (for our collective wellbeing).

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If wages are not going up, where is the money going to come from to support rent increases?

For the short term it would appear that people would spend less elsewhere in the economy. This means people will cut spending on going out to restaurants, cinema, change tariff on mobile phone etc...

Long term clearly the money will run out and the rent demanded will be impossible to service.

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Housing benefit?

That magical benefit that =

rent - [(income-£50)*0.65]

or if your disabled, have kids, 25+, +55, +65, +75, a war widow it will be slightly higher;

rent - [(income-£{yor minimum required income to survive})*0.65]

and it is capped.

Check out your local LHA.

Even if your working part time on minimum wage your not going to get much.

Your rent might just be covered if your income is 0.

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And my collective entity will wreak havoc upon thee, smite you and your empire, and rob you of all of your possessions.  If ye give not to the poor, nor provide them meaningful work, they'll become your enemy, wrt to the state, an enemy within.  

I demand meaningful work for us all, and higher wages for those doing meaningful work.  Less exploitation of the workers will benefit all of us (bar those whom are too greedy/exploitative), especially the workers who generate the wealth and get such a raw deal, they envy those with the least.

As it stands, benefits are far far cheaper than jail.  Cutting benefits is way too expensive.

When meaningful work could be done, paying them wages instead of benefits, it is also a waste of money (for our collective wellbeing).

I don't begrudge anyone on benefits, pretty much for the above reasons. They will disband the RAF, army before they seriously cut benefits. The elite won't last long if the "mob" is unleashed. And anyway benefits are nothing compared to the looting by banksters, the crony capitalists and their Elizabethan "monopolies."

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I don't begrudge anyone on benefits, pretty much for the above reasons. They will disband the RAF, army before they seriously cut benefits. The elite won't last long if the "mob" is unleashed. And anyway benefits are nothing compared to the looting by banksters, the crony capitalists and their Elizabethan "monopolies."

It's very worrying. I can work, and when I have I've been twice as productive as the next man, 3,4+ times that of a woman/invalid.

I received for that a 10% rise in income. An income which is supposedly there to support the rest of society. But all it would do, would be generate massive profits for the likes of ASDA at my own expense, and ultimately society's.

I make a decent income when exploiting others/self employed, but it doesn't really float my boat, when it ain't productive for society as a whole.

I fear for the future.

Sensible people in control of capital need to invest in agriculture, housing, and science/engineering. And soon.

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When we were looking for another rental we met some couples who were in a similar position (most without kids admittedly) who were moving ... to Australia or New Zealand. If we were in your situation we would seriously consider it as well.

it will be the same situation for you in NZ I am afraid

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The reality is that if you take a long term view on rents, they will always rise.

How long term? Ive not seen them move in 10 years, nor have I seen wages move over the same period. I think these are related.

I think the report is complete balocks. Supply and demand blah blah - yes all very well, but you put a property on the rental market for an amount that is not affordable, it isn't going to get rented.

Edited by cybernoid

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It's a very difficult, unsettled, in between phase. Northing is clear, but rents which cannot be afforded will not actually be paid will they? As property prices fall, the position will alter and bring rents down with it. This current upward pressue is not that strong and will not last. The BTL firesale has barely begun. When IR's rise and the whole property market has to revalue itself, you will see a big change.

I don't agree with the "zero sum" view of property, where one less buyer equals one more rental property, or higher rents are capped by people's ability to pay.

Living standards are declining. Right now most people are becoming less well off every month. And if living standards keep declining then we'll progressively go back to the lifestyles of the 80's, 70's, 60's, and 50's.

What will that mean?

Lower house prices relative to incomes, but lower levels of owner occupation, with first time buyers getting older.

House and flat sharing for renters, with more people crammed into smaller spaces, sharing bathrooms and kitchens, sharing gardens and front doors.

Smaller cars and fewer cars per household. Bicycles and scooters are fashionable, soon we'll realise they're all that's affordable for many people.

Shrinking welfare payments and pensions.

"Staycations " currently mean a holiday in the UK, before long they'll mean a holiday at home with a few days out during the fortnight.

In 1900 the two largest categories of employment in Britain were "farm labourer" and "domestic servant". I don't see agricultural employment bouncing back any time soon, but I think it's a banker's bet that we'll see an increase in domestic servants. Only this time around they'll be called "care workers" and "child minders".

Declining living standards doesn't mean good, cheap houses for all of us, what it means is grimmer more cramped existences for the majority.

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Despite what journalists might think, demand is not a static lump - 'one less buyer' is not 'one more renter'. People move in together, go home to the parents, stay on a friend's sofa, even live in Hoovervilles if they get poor enough:

hooverville_bb9c1.jpg

Depression generally reduces demand for everything.

(As people keep saying about house buying, demand is desire plus money to pay for it. It's true for renting too.)

+1

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http://www.telegraph.co.uk/finance/economics/houseprices/7967272/Rents-set-to-surge-as-new-buyers-struggle-to-find-mortgages.html

I really don't understand this thinking, supply and demand has to operate within the limits of affordability, surely? Where do landlords overpricing their rentals think the money is going to come from? This is renting, which is based on actual affordability, not buying, based on insane lending.

How can rents rise without rising salaries? Do property debtors actually believe that the renters are going to pay off their ludricous loans for them?

THERE IS NO MONEY!

You're guilty of thinking logically and rationally there.

Slap on wrist!

Remember we're talking about real estate here - the realm in which logic and reason are (still) suspended and prices are set only by perceived demand and can be ramped up at will due to the availability of limitless (no longer available) credit.

We still live in 0% APR lCapital One 'got a pulse, get endless credit' la-la land, the place of magic beans and endless consumerist smiles.

Be happy with yourself that you 'don't understand this thinking'!

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  • 244 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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