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Radio 4 Interview Btl Mortgages Are Expanding---Merged Threads

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Just listening to Today on Radio 4 and there was a 5 minute discussion between representatives of 1st Time Buyers and some Landlords Association about the news that Yorkshire Building Society is going to offer BTL mortgages, initially in the south and south east.

Interesting facts came out

200 BTL mortgages products in 2009, 500 btl mortgage products today

High Demand for Rented property

BTL accounts for 11% of the total mortgage market

Landlords have better financial firepower than 1st Time buyers

Landlord have access to interest only mortgages and get tax breaks for maintenance and interest payments

The points that occurred to me were

the BTL brigade are likely to capture more of the bottom end housing market and let it out to 1st Time buyers so compounding housing problems for the young

It is not a level playing field as the tax breaks give the landlords an advantage

The finance companies seem to be using the landlords to reduce their risk of default on payments as 1st time buyers have lower job security

I can't see the Government doing anything as the MP's are all into it anyway

The only thing I can think of is that parents should, if they are able, buy property for their kids and then put them in as tenants and then sign over to them for a price at a later date so getting the tax breaks for maintanance and mortgage interest .

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Only problem is the original BTL landlord paid 140K each for the houses so net loss on 4.5 million pounds.

Lender Beware.

Indeed.

BTL round here - the big landlord has run out of options. He was the local market.

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Just listening to Today on Radio 4 and there was a 5 minute discussion between representatives of 1st Time Buyers and some Landlords Association about the news that Yorkshire Building Society is going to offer BTL mortgages, initially in the south and south east.

Interesting facts came out

200 BTL mortgages products in 2009, 500 btl mortgage products today

High Demand for Rented property

BTL accounts for 11% of the total mortgage market

Landlords have better financial firepower than 1st Time buyers

Landlord have access to interest only mortgages and get tax breaks for maintenance and interest payments

I suspect that a large number of the new BTL mortgages are going to the never-ending stream of numpties who "can't sell" at the moment so convert their mortgage on their existing property to a BTL one, rent it out "until the market picks up" and then buy a new home on a residential mortgage, thus getting themselves into more debt, doubling their exposure to price falls and entering a business that they know nothing about on the assumption that things will "return to normal".

(Sorry, I may have been spending too much time on MSE recently...)

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The "priced out" rep pointed out that while the value of outstanding BTL mortgages is 11% of the total, the current market share of BTL mortgages issues is ~30%.

Other points brought up on r4:

BTL being IO mortgages

Tax advantage of BTL mortgage interest.

On your last point I know an accountant [senior partner in medium to big firm, ~60 yo but with HPC views!] who did that while his kids were at Uni on the grounds it was cheaper for him and his kids than renting from a 3rd party. "it would have been criminally stupid not to...."

Just listening to Today on Radio 4 and there was a 5 minute discussion between representatives of 1st Time Buyers and some Landlords Association about the news that Yorkshire Building Society is going to offer BTL mortgages, initially in the south and south east.

Interesting facts came out

200 BTL mortgages products in 2009, 500 btl mortgage products today

High Demand for Rented property

BTL accounts for 11% of the total mortgage market

Landlords have better financial firepower than 1st Time buyers

Landlord have access to interest only mortgages and get tax breaks for maintenance and interest payments

The points that occurred to me were

the BTL brigade are likely to capture more of the bottom end housing market and let it out to 1st Time buyers so compounding housing problems for the young

It is not a level playing field as the tax breaks give the landlords an advantage

The finance companies seem to be using the landlords to reduce their risk of default on payments as 1st time buyers have lower job security

I can't see the Government doing anything as the MP's are all into it anyway

The only thing I can think of is that parents should, if they are able, buy property for their kids and then put them in as tenants and then sign over to them for a price at a later date so getting the tax breaks for maintanance and mortgage interest .

Edited by koala_bear

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Just listening to Today on Radio 4 and there was a 5 minute discussion between representatives of 1st Time Buyers and some Landlords Association about the news that Yorkshire Building Society is going to offer BTL mortgages, initially in the south and south east.

Interesting facts came out

200 BTL mortgages products in 2009, 500 btl mortgage products today

High Demand for Rented property

BTL accounts for 11% of the total mortgage market

Landlords have better financial firepower than 1st Time buyers

Landlord have access to interest only mortgages and get tax breaks for maintenance and interest payments

The points that occurred to me were

the BTL brigade are likely to capture more of the bottom end housing market and let it out to 1st Time buyers so compounding housing problems for the young

It is not a level playing field as the tax breaks give the landlords an advantage

The finance companies seem to be using the landlords to reduce their risk of default on payments as 1st time buyers have lower job security

I can't see the Government doing anything as the MP's are all into it anyway

The only thing I can think of is that parents should, if they are able, buy property for their kids and then put them in as tenants and then sign over to them for a price at a later date so getting the tax breaks for maintanance and mortgage interest .

wow, another mortgage "product".

tossers.

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Discussion between PricedOut and the landlord lobby on BBC radio this morning.

You can now listen again -

On the Today Programme i player - 2:43 in:

http://news.bbc.co.uk/today/hi/today/newsid_9555000/9555662.stm

And on Radio5Live Breakfast Show - 2.53.50 secs in:

http://www.bbc.co.uk/programmes/b0070htg

Good to see getting some airtime

PricedOut guy should have mentioned tenants rights, or lack thereof.

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Discussion between PricedOut and the landlord lobby on BBC radio this morning.

You can now listen again -

On the Today Programme i player - 2:43 in:

http://news.bbc.co.uk/today/hi/today/newsid_9555000/9555662.stm

And on Radio5Live Breakfast Show - 2.53.50 secs in:

http://www.bbc.co.uk/programmes/b0070htg

Good to see getting some airtime

good to see the beeb reconising they are opposing sides.

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The finance companies seem to be using the landlords to reduce their risk of default on payments as 1st time buyers have lower job security.

Lending to "new" BTLers *DOES* lower the risk profile, as often they will be in their 50s, with a mortgage free house to use as collateral.

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Listened to Radio 4. Well done Priced Out for making the case for BTL...

Who would you rather gets burned when the drops come.. BTLers or FTBers ?

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Lending to "new" BTLers *DOES* lower the risk profile, as often they will be in their 50s, with a mortgage free house to use as collateral.

what?

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Lending to "new" BTLers *DOES* lower the risk profile, as often they will be in their 50s, with a mortgage free house to use as collateral.

True, but if somebody 10 years from retirement wants to gamble his home in a leveraged punt on house prices, that's his problem. The words "forced seller" and "old age poverty" spring to mind.

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True, but if somebody 10 years from retirement wants to gamble his home in a leveraged punt on house prices, that's his problem. The words "forced seller" and "old age poverty" spring to mind.

I think in many cases they have no option as they have little/no pension funds accumilated through lack of planning and bad decisions

(also the low interest rates driving annuity rates to the floor are a factor)

Often the only asset they have is a large hugely valuable unmortgaged house

The other factor is due to the failure of the stockmarket over the last 15 years and various investment scandals (endowments, equitable life, lloyds market, etc.) the only successful invesment that many of these people have ever made is in residential property

You can see why someone as feckless as that would MEW, buy a few flats with more leverage and hope that "my property will be my pension"

Its a bit like taking all your pitiful savings into the casino and sticking everything on black....

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Its a bit like taking all your pitiful savings into the casino and sticking everything on black....

Given where property prices are relative to earnings, the odds are a lot worse than that!

Anyway I'm sure the banks will be very grateful to all these BTLers donating their family homes to them.

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Anyway I'm sure the banks will be very grateful to all these BTLers donating their family homes to them.

So...

...government bailed out banks evicting Daily Mail readers out of their homes...

...I dunno if I can see that with any political party in power...

...I could see another duplicitous government bail-out paid for by savers being putting in place to prevent that...

...but then I'm a natural pessimist

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I talk to a depressingly large number of relatively well paid people who are replacing the company pension schemes, that they no longer receive, with BTL.

These would be the same sorts of people who put their money in dot com stocks, equitable life, lloyds syndicates etc. in previous decades?

:huh:<_<:o:lol::lol::lol:

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I talk to a depressingly large number of relatively well paid people who are replacing the company pension schemes, that they no longer receive, with BTL.

i was told the tail of someone trying to downsize from thier 5 bed detached but the chain was failing because the 1 bed flat at the bottom wouldn't sell. The top of the chain then bought out the bottom of the chain, with the intention of renting it out. the implication was "what a clever plan".

I thought "and so the monster starts to eat it's own tail"

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Lending to "new" BTLers *DOES* lower the risk profile, as often they will be in their 50s, with a mortgage free house to use as collateral.

It would presumably depend on the profile of the one buying to let. Back in the boom days, anyone could get a mortgage for it. And the presumption was that BTL was a better risk than a FTB.

Except that, if I recall correctly - as defaults started to rise, it became evident that a higher percentage of BTL was defaulting relative to owner occupiers/FTB.

About 1 in 3 tenants are in rent arrears at the moment; the theory was that letting to "young professionals" was foolproof. Then, as it turned out, it was that very group which began to default.

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The main reason Property price rise is because of rising income, Go out into the real world and see which way incomes are going.

I thought the main reason for property price rises was loose credit... and we will see that again

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I thought the main reason for property price rises was loose credit... and we will see that again

No that is only short term rise, long term rises only due to income inflation.

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  • 284 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
      • up 2.5%
      • up 5%



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