Sharp Increase In Mortgages To Landlords ?

[Perfectionist]

http://business.timesonline.co.uk/article/...1765257,00.html

[backtoparents]

http://business.timesonline.co.uk/article/...1765257,00.html

<{POST_SNAPBACK}>

Bunch of paid for PRs with evening classes in advanced Excel, no doubt. Plug in the number, hit the trend button, and out comes the report.

Still, as long as the BTLs keep piling in hoping for capital gains, it should keep the rents down. Magic!

/G

[sign_of_the_times]

Bunch of paid for PRs with evening classes in advanced Excel, no doubt. Plug in the number, hit the trend button, and out comes the report.

Still, as long as the BTLs keep piling in hoping for capital gains, it should keep the rents down. Magic!

/G

<{POST_SNAPBACK}>

yep, more rental properties = competition for tenants = lower rents

[Sledgehead]

Don't be silly guys, ~1m separate landlords = cartel

They'll use the internet to control prices.

Isn't it obvious? Just look at the Roman Empire

(don't tell me: housing from London can't compete with housing in Manchester... it's still supply and demand tho...)

Incidentally, if we're gonna talk Roman Empire (brainclamp), let's talk about military overextension and what i shappening in NO... how did LLs fair after the fall of the Roman Empire? )

Edited September 5, 2005 by Sledgehead

[Time to raise the rents.]

yep, more rental properties = competition for tenants = lower rents 

<{POST_SNAPBACK}>

More like, rising demand from tenants = higher rents = more incentive for landlords.

[OnlyMe]

More like a sharp increase in hope form the lenders that the policy of lending even more money to the BTL sector (which came about because they had priced out normal OO buyers and couldn't write enough loans to them) will keep their income and fee stream going.

It won't, they shouldn't have gone down this short-sighted path to boost your share price and bonuses in the first place.

[Hairlocks]

More like, rising demand from tenants = higher rents = more incentive for landlords.

<{POST_SNAPBACK}>

As I see it:

Can't sell house = try to rent out house.

Most the houses I have looked around to rent have been on the market to sell for months. Now they are going to try the renting option as well.

[Time to raise the rents.]

As I see it:

Can't sell house = try to rent out house.

Most the houses I have looked around to rent have been on the market to sell for months. Now they are going to try the renting option as well.

<{POST_SNAPBACK}>

Yes there's merit in that. A friend of mine has been trying to sell for over 6 months. IMO their place was overpriced. They even asked me if I wanted to buy it as it's in my area and is the type of house I let out. But I didn't have the heart to tell them they had lost value by converting 1 of the bedrooms to a massive bathroom & changing what was a 4 bed house to a 3 bed house. Their asking price was over £650k BTW.

Last week they emailed me, they decided to rent the place out instead. They were amazed to have a tenants deposit in their hands 2 days after first advertising.

Moral of the story:

1/ There is very good tenant demand at the moment.

2/ The tenants will be both supporting the local market and adding to demand for purchases because my friends now have the confidence to buy in their new location.

So remember, a seller renting their house out is also a potential buyer in another area.

[Sledgehead]

Or, like I said elsewhere, lend (indemnified) to landlords cos the political (and subsequent regulatory knee-jerk reaction) will be less than if you bankrupt poor, cute, lickle, hardworking, diddums, FTBs.

[delboypass]

Surprised to rent it out???

So what happens in 3 years when it comes time to sell it??

Oh thats right capital gains tax.

And i doubt everyone is clever enough to pull the wool over the inland revenues eyes.

[sign_of_the_times]

More like, rising demand from tenants = higher rents = more incentive for landlords.

<{POST_SNAPBACK}>

no, this would be the case with less rental properties available, not more supply

must try harder ttrtr

[Loanshark]

What it shows is that the banks have given up with the traditional mortgage market because no new buyers can afford to buy so they are going after the BTL investors to try and get them to expand there portfolios.

[Sledgehead]

So remember, a seller renting their house out is also a potential buyer in another area.

<{POST_SNAPBACK}>

So how does this differ from "an investor whose wild punt on tech stocks worked out became a buyer of a whole load more tech stocks?"

[sign_of_the_times]

What it shows is that the banks have given up with the traditional mortgage market because no new buyers can afford to buy so they are going after the BTL investors to try and get them to expand there portfolios.

<{POST_SNAPBACK}>

its hardly going to prop up the market. sure I read somewhere BTL's make up only 10% of the total ??

[London-loser]

Yes there's merit in that. A friend of mine has been trying to sell for over 6 months. IMO their place was overpriced. They even asked me if I wanted to buy it as it's in my area and is the type of house I let out. But I didn't have the heart to tell them they had lost value by converting 1 of the bedrooms to a massive bathroom & changing what was a 4 bed house to a 3 bed house. Their asking price was over £650k BTW. 

Last week they emailed me, they decided to rent the place out instead. They were amazed to have a tenants deposit in their hands 2 days after first advertising.

Moral of the story:

1/ There is very good tenant demand at the moment.

2/ The tenants will be both supporting the local market and adding to demand for purchases because my friends now have the confidence to buy in their new location.

So remember, a seller renting their house out is also a potential buyer in another area.

<{POST_SNAPBACK}>

£650k

See, I knew you were a bear really... their property is way overvalued, eh?

And I wonder how they came up with that price?

So, to get a (modest) 6% yield on that they'd need £39k a year in rent on a three bed place.

Any idea what rent they are getting?

My guess it is SIGNIFICANTLY less than £3,250 pcm.

[TheMadJock]

Certainly some truth in this one in my area, whether we like it or not.

One of my ex-colleuges from a 'previous life' went off to be a Financial Advisor for the local Your Move estate agent. Went to see him the other day when shopping round for mortgages and he showed me the figures. Of those completed in the past 2 months (27, I think it was) around half were to BTL-ers, and not newbie ameteurs either.

He openly admits that most 'normal' people are about priced out now but these BTL-ers keep on buying the stuff up and are having no trouble letting 2/3/4 bed houses. The only glut we have is in 1/2 bed flats. And all that considering an interest-only mortgage is still 150pm or so less than renting a similar 150K 3-bed house......

[sign_of_the_times]

However Rics also reported a fall in surveyors' expectations for rental rises - other than in London and the south west - partly because of an increase in supply.

backs up what I was saying

[Time to raise the rents.]

Surprised to rent it out???

So what happens in 3 years when it comes time to sell it??

Oh thats right capital gains tax.

And i doubt everyone is clever enough to pull the wool over the inland revenues eyes.

<{POST_SNAPBACK}>

No actually, a person selling their home which was let out would not pay CGT if they sold 3 years after the 1st let.

£650k

See, I knew you were a bear really... their property is way overvalued, eh?

And I wonder how they came up with that price?

So, to get a (modest) 6% yield on that they'd need £39k a year in rent on a three bed place.

Any idea what rent they are getting?

My guess it is SIGNIFICANTLY less than £3,250 pcm.

<{POST_SNAPBACK}>

Only a guess, no more than £2,000 being a 3 bed house. A real waste IMO.

backs up what I was saying

<{POST_SNAPBACK}>

Backs up what I was saying, rents are rising in London & the south east.

[London-loser]

Only a guess, no more than £2,000 being a 3 bed house. A real waste IMO.

You see TTRTR, we're both on the same side really...

Your friends had a £650k asking price, with £2k pcm rent that's a gross yield of less than 3.7%!

Re-calculate the "price" as a 6% yield (I still think this is low) and that gives you a £400k "value"... just 40% below the asking price.

Now, all I need to get is my landlord to recognise the asking prices for similar properties are 40% above their value and I'll be moving from renter to owner occupier.

Unfortunately, I think we're still some way from your friend or my landlord taking such a cold view of the property market.

[brainclamp]

LANDLORD vs ORDINARY BUYER:

- Tax breaks/Government policy vs Removal of tax breaks

- Subsidies via taxes vs Tax rises

- Credit/Lending expanding vs Credit/Lending declining.

- Lower interest rates, lower risk vs Higher interest rates, higher risk

- Massive effortless equity vs 5 years saving for a deposit

- 'Buying cheaply via tax reliefed, subsidised rental income' vs 'renting is cheaper than buying'

Thats how it stacks up.

So all your calculations based on the pre-tax savings rate as yield cannot make sense, once you factor in the above Landlords are miles ahead.

Watch carefully, ee will hear more and mroe how renting is so much cheaoper than buying, yet taxes will rise to match for most workers as we move into a rentier society.

[London-loser]

all your calculations based on the pre-tax savings rate as yield cannot make sense

Yup, you're right Brainclamp, that doesn't make ANY sense whatsoever.

Have you got your head around the distinct lack of massive rent rises you were predicting yet (you remember, when you couldn't rationalise how your immigration-related rants logically meant house prices soared ahead but rents did not).

Your rentier society...

zzzzZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZ

[apom]

Yes there's merit in that. A friend of mine has been trying to sell for over 6 months. IMO their place was overpriced. They even asked me if I wanted to buy it as it's in my area and is the type of house I let out. But I didn't have the heart to tell them they had lost value by converting 1 of the bedrooms to a massive bathroom & changing what was a 4 bed house to a 3 bed house. Their asking price was over £650k BTW. 

Last week they emailed me, they decided to rent the place out instead. They were amazed to have a tenants deposit in their hands 2 days after first advertising.

Moral of the story:

1/ There is very good tenant demand at the moment.

2/ The tenants will be both supporting the local market and adding to demand for purchases because my friends now have the confidence to buy in their new location.

So remember, a seller renting their house out is also a potential buyer in another area.

<{POST_SNAPBACK}>

No one denies BTL works.

But your clients calim that their house is worth £650,000

there for they couldn't sell it.

Too expensive, its market value is less.

and no one could buy it and rent it out unless you could rent it for thousands..

had they bought at the peak..?

over valued.

[apom]

Boo Hooo..

I just bought a house for £350,000 it had trebbled in five years..

and now I need to rent it for £1500 a month.. just to break even..

anyone?

[Guest Guy_Montag]

I find these claims about rising rents interesting - are people not negotiating on rent? or are the figures coming from what estate agents are asking for rather than getting?

Anyway, last year my landlady came round asking for £50 a month more rent (to cover interest rate rises - cheeky mare, house cost 60k when she bought it).

I said we'd move out if she did that & never heard from her again.

She's an amature BTLer, moved down south & rented her old house out.

See the house, round the corner from me, on the market for 180K (currently let at £6.2k per annum) is still on the market after over 6 months. Strange.

[dogbox]

More like, rising demand from tenants = higher rents = more incentive for landlords.

TTRTR

Having sold my B2Ls Ive been seeking other investment opportunities. Keep comming back to land in the (EDITED = DECIDED NOT TO SAY WHERE YET). Now having done some in depth research Ive realised the 'real' investors are buying in such areas and making trully impressive gains (Ive watched many plots double since feb 05, yes double in 6 months).

Some of these guys bought 3 years ago for £3000 now selling on for £70000.

If I can (and it wont be easy) I will try and cut out the agents (there are lots of them) and buy a large lot from locals, then subdivide and sell on lots for a healthy profit (thats without inflation aswell), to un - suspecting lazy brits who will by anything with a sea view.

Thomsons and thier like are buying huge swathes of land for development.

I cant understand people wanting to invest further in the tired UK market.

Edited September 5, 2005 by dogbox