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goldilocksporridge

What Is So Bad About Buy To Let/other Sources Of Income

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I write because i rent out a few properties and work second jobs from time to time. I know this might provoke some nasty posts. What wrong with small investors having a few buy to let properties. Ok these huge investors who have hundreds of properties, thats just pure greed, and there should something to stop this - what wrong with people trying make a some income outside their work - I mean lets face it there few ways to make money legally outside the 9 to 5 grind. its the same with people who have second job, or freelance type of work. its looked down on to have other sources of income outside some thankless "career", its like your cheating the system, people get jealous they can't bear the fact that you don't subscribe to their rules that you must choose some career, and plod away for 30 years and scrape through to retirement.

You could argue that buy to let creates no value - how many people who spend most of their working lives in careers that create no value and contribute nothing, - but this is seen as ok, there lots of business that create no value.

Edited by goldilocksporridge

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I write because i rent out a few properties and work second jobs from time to time. I know this might provoke some nasty posts. What wrong with small investors having a few buy to let properties. Ok these huge investors who have hundreds of properties, thats just pure greed, and there should something to stop this - what wrong with people trying make a some income outside their work - I mean lets face it there few ways to make money legally outside the 9 to 5 grind. its the same with people who have second job, or freelance type of work. its looked down on to have other sources of income outside some thankless "career", its like your cheating the system, people get jealous they can't bear the fact that you don't subscribe to their rules that you must choose some career, and plod away for 30 years and scrape through to retirement.

You could argue that buy to let creates no value - how many people who spend most of their working lives in careers that create no value and contribute nothing, - but this is seen as ok, there lots of business that create no value.

I guess the question is:

Did you create the wealth to buy or build your properties or did you borrow it from future generations ?

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What do you mean by value?

Isn't the whole problem of BTL not that it doesn't create value, but that it does not create wealth - it simply concentrates it in fewer and fewer hands. Additionally, there was the problem until recently of the BTL brigade being able to outbid FTBs due to access to low LTV loans and tax breaks.

IMHO, what you are doing is actually worse than someone with a larger portfolio. You are supplying a basic human need, but are unable to turn your full attention to it due to your other commitments. I think people such as the Wilsons are horrifying, but I have no real problems with someone with 10 odd properties who is running them as a full time job with minimal leverage. They should be able to monitor their properties and assist their tenants promptly.

You are also confusing two things - your rent seeking behaviour (ie your property dabbling) with your second income (which may or may not be rent seeking). If you want to increase your income fair enough IMHO and I don't care if you do not pay full attention to your work (that is your boss's problem, not mine). I agree with you that people with several income streams should not be looked down on as a principle, but if people are unhappy with the precise source of your secondary income then fair enough.

I don't care that much either way any more to be honest. I am mainly interested in working out how to better my situation without screwing other people over.

Edited by FaFa!

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Buy to let increases demand for houses, which helped push the prices into lunatic territory, thus ultimately making things more expensive for everyone else. The fallout of that is fewer being able to afford to buy their own place, and having to rent anyway, which is a vicious circle. It has artificially driven up rental demand beyond what is really needed (there is always some need for it), and increased the gap between the haves and have nots, particularly if, as has often been the case, it's effectively taking money from someone else's future.

There isn't any difference between owners of lots and few BTLs, the former are just a larger part of the problem.

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Nope all borrowed. But did you create the job in your in now? or did someone else create it for you.

What's that got to do with anything? A confusing response. Are you saying anyone who is not self-employed is essentially rent seeking? I don't follow your reasoning at all.

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What do you mean by value?

Isn't the whole problem of BTL not that it doesn't create value, but that it does not create wealth - it simply concentrates it in fewer and fewer hands. Additionally, there was the problem until recently of the BTL brigade being able to outbid FTBs due to access to low LTV loans and tax breaks.

IMHO, what you are doing is actually worse than someone with a larger portfolio. You are supplying a basic human need, but are unable to turn your full attention to it due to your other commitments. I think people such as the Wilsons are horrifying, but I have no real problems with someone with 10 odd properties who is running them as a full time job with minimal leverage. They should be able to monitor their properties and assist their tenants promptly.

You are also confusing two things - your rent seeking behaviour (ie your property dabbling) with your second income (which may or may not be rent seeking). If you want to increase your income fair enough IMHO and I don't care if you do not pay full attention to your work (that is your boss's problem, not mine). I agree with you that people with several income streams should not be looked down on as a principle, but if people are unhappy with the precise source of your secondary income then fair enough.

I don't care that much either way any more to be honest. I am mainly interested in working out how to better my situation without screwing other people over.

I hardly see how having a few properties rented out , and doing the odd repair in your part time, getting leases signed is going to stop you from doing your job properly??? Ok more than 5 then that could start taking a lot of time. Lots of people spend all their spare time on the internet and watching tv, and indeed surfing the internet at work.

i just don't like the mindset of people not liking other people having multiple streams of incomes - they want you to focus all your efforts on a job, where in a lot cases your leverage to get a payrise or increase your income is very small, e.g you work in a support function.

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What do you mean by value?

Isn't the whole problem of BTL not that it doesn't create value, but that it does not create wealth - it simply concentrates it in fewer and fewer hands. Additionally, there was the problem until recently of the BTL brigade being able to outbid FTBs due to access to low LTV loans and tax breaks.

IMHO, what you are doing is actually worse than someone with a larger portfolio. You are supplying a basic human need, but are unable to turn your full attention to it due to your other commitments. I think people such as the Wilsons are horrifying, but I have no real problems with someone with 10 odd properties who is running them as a full time job with minimal leverage. They should be able to monitor their properties and assist their tenants promptly.

You are also confusing two things - your rent seeking behaviour (ie your property dabbling) with your second income (which may or may not be rent seeking). If you want to increase your income fair enough IMHO and I don't care if you do not pay full attention to your work (that is your boss's problem, not mine). I agree with you that people with several income streams should not be looked down on as a principle, but if people are unhappy with the precise source of your secondary income then fair enough.

I don't care that much either way any more to be honest. I am mainly interested in working out how to better my situation without screwing other people over.

I hardly see how having a few properties rented out , and doing the odd repair in your part time, getting leases signed is going to stop you from doing your job properly??? Ok more than 5 then that could start taking a lot of time. Lots of people spend all their spare time on the internet and watching tv, and indeed surfing the internet at work.

i just don't like the mindset of people not liking other people having multiple streams of incomes - they want you to focus all your efforts on a job, where in a lot cases your leverage to get a payrise or increase your income is very small, e.g you work in a support function.

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I hardly see how having a few properties rented out , and doing the odd repair in your part time, getting leases signed is going to stop you from doing your job properly???

Why so defensive? And which job are you referring to when you say it won't stop you doing your job properly? I don't care about your main job, I care about your tenants who may not always have your full attention

and indeed surfing the internet at work.

:P

i just don't like the mindset of people not liking other people having multiple streams of incomes - they want you to focus all your efforts on a job, where in a lot cases your leverage to get a payrise or increase your income is very small, e.g you work in a support function.

I agree with that. It depends who you mean by "they" - if you mean your boss, then certainly I'd hide it from him/her.

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I write because i rent out a few properties and work second jobs from time to time. I know this might provoke some nasty posts. What wrong with small investors having a few buy to let properties.

Imagine a closed system. 10 "houses". At the top a succesful retired widow, going down the value range a corresponding range of folk. Some properties closer to transport, some bigger, more pleasant.

Someone at the upper end dies, someone wanting in at the lower end graduates/gets a decent job. Everyone shuffles up.

What happens if at the next step, one of the chain keeps their old house and rents it out? Presumably to one of the others in this effectively closed system? What happens at the next iteration, then the next?

Very rapidly the system becomes entirely bogged down, no one leaves the top, no one can come in at the bottom. 2 or 3 people own all the 10 properties.

Who do they now sell to or buy from?

Which country do the renters eventually decide to buy into?

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Why so defensive? And which job are you referring to when you say it won't stop you doing your job properly? I don't care about your main job, I care about your tenants who may not always have your full attention

:P

I agree with that. It depends who you mean by "they" - if you mean your boss, then certainly I'd hide it from him/her.

Tenants can still be accomodated in your part time fine- in fact I think they get a better and more personal service than leasing agencies - who are always looking to make a few quid.

and Also you can keep their rent prices lower, without the need for expensive leasing agencies add ons, cleaning charges etc, soliciters charges etc. You look at the properties rented out by leasing agencies, and i'd bet there on average higher because they need to cover the costs of covering the mortgage plus their charges. Therefore stop knocking private landlords.

Also you can accomodate a few properties, or more very easily with a full time job. In fact i'd say a private landlord is more motivated in their job because they can buy more properties.

I just can't stand the mindset that if you dare to try to make few quid outside a corporate career your deemed as some sort of money grabbing scumbag or not good enough to compete in your choosen profession, you know its a free country we can all choose to make out income in way we so long as its legal.

Edited by goldilocksporridge

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You just seem to be arguing in circles with no real focus. You reckon you can manage properties and keep and main job and do odd work on the side. I beg to differ, but I'll agree to disagree. You still haven't addressed the rent seeking aspect of what you are doing and its wider consequences.

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If every home owner was lent whatever was required necessary to buy a second property that was over and above their needs to rent out....say they didn't require any cash deposit down all they did was borrow some of the equity from their existing home...the lenders said the interest rate is boe base rate plus 0.5% lifetime tracker.

a. that would push property prices up.

b. that would price out non-property owners even further.

c. that would widen the gap further between the haves and have nots.

People that buy property to let to have been making money from nothing and taking money from future generations.....they would not do it if it lost them money.

A house should be your home not an investment........ ;)

Edited by winkie

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Tenants can still be accomodated in your part time fine- in fact I think they get a better and more personal service than leasing agencies - who are always looking to make a few quid.

and Also you can keep their rent prices lower, without the need for expensive leasing agencies add ons, cleaning charges etc, soliciters charges etc. You look at the properties rented out by leasing agencies, and i'd bet there on average higher because they need to cover the costs of covering the mortgage plus their charges. Therefore stop knocking private landlords.

Also you can accomodate a few properties, or more very easily with a full time job. In fact i'd say a private landlord is more motivated in their job because they can buy more properties.

I just can't stand the mindset that if you dare to try to make few quid outside a corporate career your deemed as some sort of money grabbing scumbag or not good enough to compete in your choosen profession, you know its a free country we can all choose to make out income in way we so long as its legal.

Let's reverse the argument.

You are young, you work hard, you want to buy a house.

I'm older, I'm looking for easy money. It's taken you a while to scrape together your deposit... me? I've just signed a few pieces of paper which put my own home up as collateral... I've got my deposit through 10 minutes of not especially hard work.

You set off with your deposit and mortgage offer clutched in your little hand... you're excited, it's your chance to own somewhere, to have a house which you can truly call home.

But.... because you took sooo loooong to EARN your deposit you discover to your horror than me and all my mates have quietly hoovered up ALL the properties in your price bracket. We know you've got to live somewhere so it makes sense to snatch the property you wanted to buy and then force you to pay us rent instead.

You can't afford to move up to a more expensive property... you were relying on your starter home rising in value so that you've have enough equity to make the next move... just like I did. The thing is I'm a selfish Kunt.... I benefited from the housing market as it used to operate... you sold, you bought somewhere else. I don't see why you should enjoy the kind of benefits I didn't have to work hard for...... my whole BTL empire is based on the fact that people used to sell one house and then buy another... that's how I managed to buy and move up the food chain.

I believe strongly in free markets and private enterprise.... but the kicker is I'm not clever enough to run a proper business and I'm too lazy to work for my extra cash.... why should I when you're there boxed into a neat little corner? Unless you want to stay in Mum's box room or sleep on the street you're f*cked... you know it, I know it, my mates know it..... how do you think we managed to persuade the bank manager to lend us more money? It's called a captive market sonny.

No f*ck off back to work.... the rents due in two weeks and I've got mortgages which you need to be paying.

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I just can't stand the mindset that if you dare to try to make few quid outside a corporate career your deemed as some sort of money grabbing scumbag or not good enough to compete in your choosen profession, you know its a free country we can all choose to make out income in way we so long as its legal.

No one is saying that.

Btl is despised by most moral people due to its exploitative nature. It results in cutting social mobility, preventing people from living what only a generation ago was considered to be a normal life. Those on the perpetual rent treadmill who have been priced out of property ownership and have to rent cannot plan for a future, are put off from having families, are dictated to about whether they can even have a pet, and can be evicted with 2 months notice from their home. It is immoral and you should be ashamed.

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Imagine a closed system. 10 "houses". At the top a succesful retired widow, going down the value range a corresponding range of folk. Some properties closer to transport, some bigger, more pleasant.

Someone at the upper end dies, someone wanting in at the lower end graduates/gets a decent job. Everyone shuffles up.

What happens if at the next step, one of the chain keeps their old house and rents it out? Presumably to one of the others in this effectively closed system? What happens at the next iteration, then the next?

Very rapidly the system becomes entirely bogged down, no one leaves the top, no one can come in at the bottom. 2 or 3 people own all the 10 properties.

Who do they now sell to or buy from?

Which country do the renters eventually decide to buy into?

In reality housing need not be a "closed system" though as the UK is mostly fields. Only the planning laws make it seem closed.

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I write because i rent out a few properties and work second jobs from time to time. I know this might provoke some nasty posts. What wrong with small investors having a few buy to let properties. Ok these huge investors who have hundreds of properties, thats just pure greed, and there should something to stop this - what wrong with people trying make a some income outside their work - I mean lets face it there few ways to make money legally outside the 9 to 5 grind. its the same with people who have second job, or freelance type of work. its looked down on to have other sources of income outside some thankless "career", its like your cheating the system, people get jealous they can't bear the fact that you don't subscribe to their rules that you must choose some career, and plod away for 30 years and scrape through to retirement.

You could argue that buy to let creates no value - how many people who spend most of their working lives in careers that create no value and contribute nothing, - but this is seen as ok, there lots of business that create no value.

I generally don't have a problem with people being able to buy a property or ten to rent out, provided they are exposed to the downsides and not bailed out with other people's money when the market turns. If the market had been left to its own devices and allowed to crash during the credit crunch then you wouldn't hear so many complaints now. Property portfolios would have been repossessed and put on the market at reduced prices, allowing others to buy them up and life would go on, etc. However the government prevented this from happening and we now have a divide between those with large portfolios of houses, paying 2% interest on their mortgages, while renting them out to people with less chance of competing because their rents haven't gone down and yet their savings rates have.

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BTL is the same as buying shares in a privatised utility. It's a government backed gamble with very favourable odds. Unless you buy very stupid it's hard to lose.

When you buy shares you are using your own money...when you buy land and buildings you are using someone else's money.

Property will fall when credit is tightened, interest rates rise and capital gains tax increases....

At the moment government and banks are happy to see sky's the limit....the government are in too much debt themselves to put interest rates up and they can't afford any more bail outs, it will cost them more than just money ....a capital gains property tax seems a logical way forward, but turkeys don't vote for Christmas. ;)

Edited by winkie

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Let's reverse the argument.

You are young, you work hard, you want to buy a house.

I'm older, I'm looking for easy money. It's taken you a while to scrape together your deposit... me? I've just signed a few pieces of paper which put my own home up as collateral... I've got my deposit through 10 minutes of not especially hard work.

You set off with your deposit and mortgage offer clutched in your little hand... you're excited, it's your chance to own somewhere, to have a house which you can truly call home.

But.... because you took sooo loooong to EARN your deposit you discover to your horror than me and all my mates have quietly hoovered up ALL the properties in your price bracket. We know you've got to live somewhere so it makes sense to snatch the property you wanted to buy and then force you to pay us rent instead.

You can't afford to move up to a more expensive property... you were relying on your starter home rising in value so that you've have enough equity to make the next move... just like I did. The thing is I'm a selfish Kunt.... I benefited from the housing market as it used to operate... you sold, you bought somewhere else. I don't see why you should enjoy the kind of benefits I didn't have to work hard for...... my whole BTL empire is based on the fact that people used to sell one house and then buy another... that's how I managed to buy and move up the food chain.

I believe strongly in free markets and private enterprise.... but the kicker is I'm not clever enough to run a proper business and I'm too lazy to work for my extra cash.... why should I when you're there boxed into a neat little corner? Unless you want to stay in Mum's box room or sleep on the street you're f*cked... you know it, I know it, my mates know it..... how do you think we managed to persuade the bank manager to lend us more money? It's called a captive market sonny.

No f*ck off back to work.... the rents due in two weeks and I've got mortgages which you need to be paying.

And that should be on the front page!

Funny how the next lot are going to also get debt at levels that you probably had for your first mortgage just to get the degree you got paid to do!

:D

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In reality housing need not be a "closed system" though as the UK is mostly fields. Only the planning laws make it seem closed.

Ah, but even the constant addition of parition walls to previously adequate housing to create bedsit slums can't keep up with the ravenous levels of BTL hoarding...

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Buying a share in a privatised utility is profiteering because the issue is priced so the initial investor can't lose. Accepting a de-mutualisation payment is similarly loaded in favour of the 'gamble'. BTL mortgages are an extension of exactly the same principal, the only difference is the effects are obvious and not tucked away in an overseas sweatshop or South American logging camp or wherever the bottom line is.

BTL chickens roost at home.

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There is nothing wrong with buying to rent.

The problem comes when money is so cheap people park their money in residential property.

There is no way a real investor should be able to compete with a buyer who wants to live there who is not thinking of making a profit. Think of the traditional landlord properties small flats, HMOs, student houses and projects requiring renovation. they bought these as not many people desired to purchase them but they need them at stages during their lives.

Really since 2004 can you really buy a house rent it and cover the mortgage payments? Its a mania the ponzi phase of buying something that looses money in a hope to flog it later.

We wont be blaming people who recently invested in property when IR are over 5% again we will be feeling sorry for them as in most cases they didn't know what they where doing.

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There is nothing wrong with buying to rent.

Seems pretty dumb to me. Surely if you have a decent rate you don't want someone else to profit from you having a roof overhead?

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  • 276 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% +
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      • Even
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      • up 5%



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