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Buy To Let - Brilliant Scheme Or Path To Ruin?

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Yahoo! look at for and against...

http://uk.finance.yahoo.com/news/buy-to-let-brilliant-money-making-scheme-or-a-path-to-ruin-114029766.html

Every region in England and Wales saw annual rent increases in April, with the average rent now 3.9% higher than a year ago, according to the most recent data from LSL Property Services.

It calculates that the average landlord in England and Wales can expect to make a total annual return of 5.7% or £9,496 on a property over the next 12 months.

Who are LSL? Have I missed something?

What people frequently forget when they look at buy-to-let property is the scale of the risks.

Buy-to-let isn’t about buying somewhere you want to live, it’s about making the most cash from your money. And it’s an expensive way to do it.

Rightmove (LSE: RMV.L - news) says government efforts to bolster lending had created an "arbitrage of immediate return".

Britain's biggest property listings website today said investors were piling into buy-to-let for "blindingly good returns" after the government's efforts to bolster lending had created an "arbitrage of immediate return".

http://uk.finance.yahoo.com/news/buyers-rush-blinding-returns-buy-130537962.html (March 2013)

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You pay your money and you take your chances

Believe this guy and it's the

Road to riches

Learn how here with "no money down".

We are in an economic time where vendors cannot move on because of the dramatic slow down in capital growth. This has brought Options etc into a time of their own
Getting an Option on a property allows you to take control of a property with very little outlay or risk, you get the Right to buy but not the Obligation. This really is a win, win situation for both sides.
There are so many different ways to make money from property without having to buy them.

or you could take the view that it is the

Road to ruin

According to figures from the Council of Mortgage Lenders (CML), one in five repossessions in the first quarter of 2013 were buy to let properties.

This is up from the final three months of last year, when buy to let properties made up 12.8 per cent of the repossessed properties.

Edited by LiveinHope

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wages down...housing benefit cuts...the real economy getting worse....more cuts to come...rents up :rolleyes: ....rent arrears up too no doubt.

I only know one BLTer and he's owed 5K now in lost rent this year.

The low interest rates have saved him for now but suddenly the nice little earner is turning into a nice little nightmare.

The trouble with get rich schemes is, only the people at the top of the pyramid get rich.

800px-Pyramid_scheme.svg.png

I estimate we are on level 9-10, so we need 50-350 million home owners to joing the pyramid to keep it going.....I say this isn't going to happen. :lol:

Edited by TheCountOfNowhere

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BTL was a brilliant scheme when prices go up, if they stagnate the late comers are going to have problems. If prices have a large correction and interest rates go up then we'll see real problems in the sector. So far everyone's a "winner".

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BTL was a brilliant scheme when prices go up, if they stagnate the late comers are going to have problems. If prices have a large correction and interest rates go up then we'll see real problems in the sector. So far everyone's a "winner".

Level 8 winners...all they need is level 9 to join....then all they need is level 10 so they make a nice profit....we better get more immigrants in quick.

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Sadly true - if you can borrow at 3% and get a 5.7% yield - over the short term, you are "cash positive"

And for the statistics, BTL lending is "business lending."

:rolleyes: a few of the flats near me have had 2-5 months of no tenants in the last year or so before having people move back in..

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Of course it is a Brilliant Scheme. It makes you rich without you having to do any work! Isn't that the definition of a Brilliant Scheme?

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Of course it is a Brilliant Scheme. It makes you rich without you having to do any work! Isn't that the definition of a Brilliant Scheme?

That's the definition of a get rich quick scheme for sure.

Get Rich quick

"A get-rich-quick scheme is a plan to acquire high rates of return for a small investment. The term "get rich quick" has been used to describe shady investments since at least the early 1900s.[1][2]

Most schemes promise that participants can obtain this high rate of return with little risk, and with little skill, effort, or time. Get rich quick schemes often assert that wealth can be obtained by working at home. Legal and quasi-legal get-rich-quick schemes are frequently advertised on infomercials and in magazines and newspapers"

Got to love wikipedia.

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Apparently rents are up.

Apparently they go up 5% each and every year....or thats the impression I get....I cant remember a report EVER showing that rents are falling.

@ 5% they must have more than doubled by now since 2000.

:D

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BTL was a brilliant scheme when prices go up, if they stagnate the late comers are going to have problems. If prices have a large correction and interest rates go up then we'll see real problems in the sector. So far everyone's a "winner".

You win some, then the money runs out, then you lose some.......it's not when you buy but more importantly when you sell. ;)

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Path to Ruin.

It is the Game of Monopoly writ large.

There will be people apparently winning before the game ends.

Premier League season 2011-2012...Manchester United were champions until the final minute of the season...then they weren't.

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  • 241 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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