Bland Unsight Posted March 21, 2017 Share Posted March 21, 2017 46 minutes ago, Venger said: It's only marginally better than BTL imo, giving people no real stake in the community/society imo, and paying up to financial system/mores/execs/shareholders, although I am not going to really argue it here. Build To Rent is different. They can do what they want to serve those who are not that bothered about homeownership. I'd imagine that Fat Fergus was almost certainly damn near 100% leveraged when his portfolio was growing like crazy. In fact once latent CGT is taken into account the situation might have been worse than that. With that kind of leverage you can rapidly come to control an amount of property which is obscenely disproportionate to the investment you've made - and your finances are sketchy as f**k. It's not providing a service, it's a suicide mission. Whilst not every BTL investor took that choice, every BTL investor had the opportunity to do exactly that, and that is the problem with BTL. Given that the market may show capital gains allowing punters that kind of leverage is inherently problematic. That's the key difference between the corporate investors and the BTL guys - the scale of the leverage and the willingness to give up income in order to keep doubling down the bet on capital gains. It's like comparing someone peddling crack to crack addicts to a responsible publican serving beer. There are social harms in relation to both, but one is not as bad as the other. Quote Link to comment Share on other sites More sharing options...
PSP Posted March 21, 2017 Share Posted March 21, 2017 6 minutes ago, Bland Unsight said: I'd imagine that Fat Fergus was almost certainly damn near 100% leveraged when his portfolio was growing like crazy. In fact once latent CGT is taken into account the situation might have been worse than that. With that kind of leverage you can rapidly come to control an amount of property which is obscenely disproportionate to the investment you've made - and your finances are sketchy as f**k. It's not providing a service, it's a suicide mission. Whilst not every BTL investor took that choice, every BTL investor had the opportunity to do exactly that, and that is the problem with BTL. Given that the market may show capital gains allowing punters that kind of leverage is inherently problematic. That's the key difference between the corporate investors and the BTL guys - the scale of the leverage and the willingness to give up income in order to keep doubling down the bet on capital gains. It's like comparing someone peddling crack to crack addicts to a responsible publican serving beer. There are social harms in relation to both, but one is not as bad as the other. That's absolutely correct ! I couldn't agree with you more ! The only thing I disagree with you on is I see corporate bodies picking the houses up after the car crash that is comming ! Imagine the scenario house price crash, banks take a huge hit 400k houses drop to 250k London M25 amateur landlords are toasted all within 12 months. The average joe thinks good buying opportunity here for me to get out of rental into his own o/o place ! bank manager says due to the turbulence of the market we are now looking for 30 % deposits or 20 percent deposits ! With a grade a secure job ! Realistically how many average joe have 50k-75 k liquid ? The likely hood is as above in Vengers link the big hedge funds move n at the bottom of the cycle and the average joe gets nowhere again ! Quote Link to comment Share on other sites More sharing options...
Bland Unsight Posted March 21, 2017 Share Posted March 21, 2017 Also, people need to stop feeding the troll. Quote Link to comment Share on other sites More sharing options...
PSP Posted March 21, 2017 Share Posted March 21, 2017 9 minutes ago, Bland Unsight said: Also, people need to stop feeding the troll. Can't comprehend life not going your way down south ! weak and poor behaviour ! Life is great up here ! ? Quote Link to comment Share on other sites More sharing options...
Lavalas Posted March 21, 2017 Share Posted March 21, 2017 31 minutes ago, PSP said: Can't comprehend life not going your way down south ! weak and poor behaviour ! Life is great up here ! ? This thread is not Blur v Oasis mate. It's laugh at leveraged goons. It's base humour but not that base. Quote Link to comment Share on other sites More sharing options...
PSP Posted March 22, 2017 Share Posted March 22, 2017 7 hours ago, Lavalas said: This thread is not Blur v Oasis mate. It's laugh at leveraged goons. It's base humour but not that base. Funny you should say that! That has prompted two thoughts why is the south such a fecked up place for O/o? 1.is it the retired teacher fireman ambulance man who can't find any return on his/her retirement money ( because george and his chums have crucified savers/pensioners ) so extremely misguided by the morning propaganda deluge of shite TV programmes goes down the delusional route of I am now a professional landlord and buys an investment property which he /she is ill equipped to manage ? ( which I think is total lunacy ) 2. Apply above all over the uk, it seems to work fine in areas such as Mill Hill Blackburn for example, but not down south ? 3. So it is not really BTL scum as the title suggests ( as abhorrent as the amateur landlord is ) it is more, a socially engineered supply and demand problems by land bank holders in the south ! I.e. Plenty of supply up north to meet demand so no problems here a perfectly functioning housing market with adequate supply or rental properties to meet demand and adequate supply of o/o property to meet demand social harmony! ! So restricted supply down south, a huge influx or immigrants adding pressure to an already pressured housing market, a massive problems with land banking under supply of O/o property, which in turn create a spiral of rising prices which sucks in further dodgy money from around the world ! To summarise ! The south is fecked the north is great ! Have a nice day ! Quote Link to comment Share on other sites More sharing options...
GreenDevil Posted March 22, 2017 Share Posted March 22, 2017 19 minutes ago, PSP said: Funny you should say that! That has prompted two thoughts why is the south such a fecked up place for O/o? 1.is it the retired teacher fireman ambulance man who can't find any return on his/her retirement money ( because george and his chums have crucified savers/pensioners ) so extremely misguided by the morning propaganda deluge of shite TV programmes goes down the delusional route of I am now a professional landlord and buys an investment property which he /she is ill equipped to manage ? ( which I think is total lunacy ) 2. Apply above all over the uk, it seems to work fine in areas such as Mill Hill Blackburn for example, but not down south ? 3. So it is not really BTL scum as the title suggests ( as abhorrent as the amateur landlord is ) it is more, a socially engineered supply and demand problems by land bank holders in the south ! I.e. Plenty of supply up north to meet demand so no problems here a perfectly functioning housing market with adequate supply or rental properties to meet demand and adequate supply of o/o property to meet demand social harmony! ! So restricted supply down south, a huge influx or immigrants adding pressure to an already pressured housing market, a massive problems with land banking under supply of O/o property, which in turn create a spiral of rising prices which sucks in further dodgy money from around the world ! To summarise ! The south is fecked the north is great ! Have a nice day ! Some interesting points! Time to move up north and buy that nice large detached house I've been looking for for the last 3 years and can't afford darn sarf? Quote Link to comment Share on other sites More sharing options...
Lavalas Posted March 22, 2017 Share Posted March 22, 2017 Sorry to just link to the Tenant Tax Facebook page but you can't copy and paste comments from there. Anyway, someone pointed out the elephant in their campaign room is that rents are going down. I love the Tenant Tax reply in the comments... https://m.facebook.com/story.php?story_fbid=1438193996223600&id=1077700412272962 Quote Link to comment Share on other sites More sharing options...
spyguy Posted March 22, 2017 Share Posted March 22, 2017 5 minutes ago, Lavalas said: Sorry to just link to the Tenant Tax Facebook page but you can't copy and paste comments from there. Anyway, someone pointed out the elephant in their campaign room is that rents are going down. I love the Tenant Tax reply in the comments... https://m.facebook.com/story.php?story_fbid=1438193996223600&id=1077700412272962 The biggest immediate threat to all LLs is the removal of benefits from EUers. I would guess that will happen pretty quickly after Brexit, probably before it. Although people shout me own on my numbers, I reckon thats going to release ~2m rental units. Quote Link to comment Share on other sites More sharing options...
PSP Posted March 22, 2017 Share Posted March 22, 2017 28 minutes ago, GreenDevil said: Some interesting points! Time to move up north and buy that nice large detached house I've been looking for for the last 3 years and can't afford darn sarf? As long as you are buying to live her and not rent it you are welcome anytime ! ? Quote Link to comment Share on other sites More sharing options...
goldbug9999 Posted March 22, 2017 Share Posted March 22, 2017 15 hours ago, Bland Unsight said: I think one of the things that I'm dancing around here is the idea that maybe if we face a market where renting is so inferior to buying that everyone wants to buy then there must be something wrong with the market. The key thing is that housing needs to be (much) cheaper whatever ones preferred method of procuring it. Quote Link to comment Share on other sites More sharing options...
so whats all the fuss? Posted March 22, 2017 Share Posted March 22, 2017 On 20/03/2017 at 10:38 PM, satch said: I love the quote ..... 'Landlords don't pay for anything in their business ..... but their customers do'. Well their customers can choose to be somebody else's customer. Good old Gary Dully the property magnet, I like to take a special interest in Gazza on account of him living so near to me. Check out the last sentence on his "cosy flats & houses.com" home page At Cosy Flats and Houses, the customer always comes first. Really Gazza do they? I have just printed off all 81 pages of his new tenant information pack pmsl. The dozy twonk has even given his home address out for the world to see. http://www.cosyflatsandhouses.com/index.php Quote Link to comment Share on other sites More sharing options...
CunningPlan Posted March 22, 2017 Share Posted March 22, 2017 1 hour ago, so whats all the fuss? said: Good old Gary Dully the property magnet, I like to take a special interest in Gazza on account of him living so near to me. Check out the last sentence on his "cosy flats & houses.com" home page At Cosy Flats and Houses, the customer always comes first. Really Gazza do they? I have just printed off all 81 pages of his new tenant information pack pmsl. The dozy twonk has even given his home address out for the world to see. http://www.cosyflatsandhouses.com/index.php I assume you are also aware of this one - http://probatepropertywanted.co.uk/ It's like he has done his website with letraset but is running low on lower case letters so uses capitals whenever possible. He is also completely out of apostrophes. It is also amusing that his business USP is primarily 'HMRC want some money off you that you haven't got - so we will pay you as little as possible for your house to further add to your misery' Who Said Irony Is Dead? Quote Link to comment Share on other sites More sharing options...
Dyson Fury Posted March 22, 2017 Share Posted March 22, 2017 1 hour ago, CunningPlan said: I assume you are also aware of this one - http://probatepropertywanted.co.uk/ It's like he has done his website with letraset but is running low on lower case letters so uses capitals whenever possible. He is also completely out of apostrophes. It is also amusing that his business USP is primarily 'HMRC want some money off you that you haven't got - so we will pay you as little as possible for your house to further add to your misery' Who Said Irony Is Dead? strewth. www.webuymingers.com seems to be offline now (I am sure you can excavate it via webarchive). But www.sellittonight.com is there in bright red glory. And www.scruffypropertywanted.com/ is still online too (put sunglasses on before viewing). Quote Link to comment Share on other sites More sharing options...
Bland Unsight Posted March 22, 2017 Share Posted March 22, 2017 55 minutes ago, Dyson Fury said: strewth. www.webuymingers.com seems to be offline now (I am sure you can excavate it via webarchive). But www.sellittonight.com is there in bright red glory. And www.scruffypropertywanted.com/ is still online too (put sunglasses on before viewing). Has anyone had time to check on the availability of the WeBuyHousesThatAreActuallyOnFire.com domain name? Quote Link to comment Share on other sites More sharing options...
Patient London FTB Posted March 22, 2017 Share Posted March 22, 2017 More musings on selling up from the Evening Standard's Accidental Landlord this week. Looks like she has reached the bargaining phase. To recap, she lets four properties in south London and has been aware of Section 24 for a long time but has been putting off a decision on what to do about it. A few weeks ago she went through her options and figured out that raising the rents was going to be pretty difficult. This week she has got to the position of I could sell, but oh my the capital gains tax is so big and I don't know where to invest the money. We're told that one of her tenants has "out of the blue asked if I will sell him my flat" and this is well-timed as she had been thinking of getting rid of it due to Section 24 and her and her husband need to spend at least £20k on it to keep it in good condition over the next two years. Ah, but selling a flat that has doubled in value and reinvesting the profit in something else is apparently not a no-brainer (well I guess not if you can't invest in anything else with IO leverage). She writes they will "lose" a large chunk of their profit in CGT and legal fees (did they not realise that when they invested in property in the first place?), then goes on to outline the drawbacks with alternative investments. Pension returns aren't as exciting as profit on property, while ways of avoiding CGT such as the Enterprise Investment Scheme or the Seed Enterprise Investment Scheme are risky. So she gets on to the idea of selling the flat and buying another BTL property in a city with higher yields but says the CGT, legal fees and stamp duty surcharge put her off, so she is going to hold on to the flat. We aren't told anything about the rental income but the implication is she can withstand the Section 24 wedge. I think the column is pretty illustrative of where the average landlord - not the Property 118 super-leveraged crew - is at the moment, but also shows the effect of the government deciding to keep property CGT at 28%. The govt does want to squeeze out BTL gradually, but it doesn't want to provoke a crash with a rush for the exits, and the 28% CGT is a good way of disincentivising existing landlords from selling. Quote Link to comment Share on other sites More sharing options...
Ah-so Posted March 22, 2017 Share Posted March 22, 2017 55 minutes ago, Patient London FTB said: More musings on selling up from the Evening Standard's Accidental Landlord this week. Looks like she has reached the bargaining phase. To recap, she lets four properties in south London and has been aware of Section 24 for a long time but has been putting off a decision on what to do about it. A few weeks ago she went through her options and figured out that raising the rents was going to be pretty difficult. This week she has got to the position of I could sell, but oh my the capital gains tax is so big and I don't know where to invest the money. We're told that one of her tenants has "out of the blue asked if I will sell him my flat" and this is well-timed as she had been thinking of getting rid of it due to Section 24 and her and her husband need to spend at least £20k on it to keep it in good condition over the next two years. Ah, but selling a flat that has doubled in value and reinvesting the profit in something else is apparently not a no-brainer (well I guess not if you can't invest in anything else with IO leverage). She writes they will "lose" a large chunk of their profit in CGT and legal fees (did they not realise that when they invested in property in the first place?), then goes on to outline the drawbacks with alternative investments. Pension returns aren't as exciting as profit on property, while ways of avoiding CGT such as the Enterprise Investment Scheme or the Seed Enterprise Investment Scheme are risky. So she gets on to the idea of selling the flat and buying another BTL property in a city with higher yields but says the CGT, legal fees and stamp duty surcharge put her off, so she is going to hold on to the flat. We aren't told anything about the rental income but the implication is she can withstand the Section 24 wedge. I think the column is pretty illustrative of where the average landlord - not the Property 118 super-leveraged crew - is at the moment, but also shows the effect of the government deciding to keep property CGT at 28%. The govt does want to squeeze out BTL gradually, but it doesn't want to provoke a crash with a rush for the exits, and the 28% CGT is a good way of disincentivising existing landlords from selling. What struck me about the article is that it illustrates what will become common - the sale of BTL properties to first time buyers. The supply of rental property will reduce by one because of s24 but the demand for rental property will also reduce by one. It's as though the market isn't listening to property 118. Quote Link to comment Share on other sites More sharing options...
Patient London FTB Posted March 22, 2017 Share Posted March 22, 2017 10 minutes ago, Ah-so said: It's as though the market isn't listening to property 118. Further confirmation of that in a survey published by HomeLet today: 52% of all the landlords we spoke to are looking to raise rents - that's down from 57% in 2015 Quote Link to comment Share on other sites More sharing options...
Bland Unsight Posted March 22, 2017 Share Posted March 22, 2017 10 minutes ago, Ah-so said: What struck me about the article is that it illustrates what will become common - the sale of BTL properties to first time buyers. The supply of rental property will reduce by one because of s24 but the demand for rental property will also reduce by one. It's as though the market isn't listening to property 118. Bonkers, isn't it? These PovertyLater guys are the property experts and yet events are playing out in the way that us pea-brained numbskull anarchists predicted. Quote Link to comment Share on other sites More sharing options...
disenfranchised Posted March 22, 2017 Share Posted March 22, 2017 4 hours ago, CunningPlan said: It is also amusing that his business USP is primarily 'HMRC want some money off you that you haven't got - so we will pay you as little as possible for your house to further add to your misery' Who Said Irony Is Dead? Brilliant. Cometh the hour, cometh the man. Thank you Gideon Osbrown for S24. Quote Link to comment Share on other sites More sharing options...
Ballyk Posted March 22, 2017 Share Posted March 22, 2017 1 hour ago, Patient London FTB said: More musings on selling up from the Evening Standard's Accidental Landlord this week. Looks like she has reached the bargaining phase. To recap, she lets four properties in south London and has been aware of Section 24 for a long time but has been putting off a decision on what to do about it. A few weeks ago she went through her options and figured out that raising the rents was going to be pretty difficult. This week she has got to the position of I could sell, but oh my the capital gains tax is so big and I don't know where to invest the money. We're told that one of her tenants has "out of the blue asked if I will sell him my flat" and this is well-timed as she had been thinking of getting rid of it due to Section 24 and her and her husband need to spend at least £20k on it to keep it in good condition over the next two years. Ah, but selling a flat that has doubled in value and reinvesting the profit in something else is apparently not a no-brainer (well I guess not if you can't invest in anything else with IO leverage). She writes they will "lose" a large chunk of their profit in CGT and legal fees (did they not realise that when they invested in property in the first place?), then goes on to outline the drawbacks with alternative investments. Pension returns aren't as exciting as profit on property, while ways of avoiding CGT such as the Enterprise Investment Scheme or the Seed Enterprise Investment Scheme are risky. So she gets on to the idea of selling the flat and buying another BTL property in a city with higher yields but says the CGT, legal fees and stamp duty surcharge put her off, so she is going to hold on to the flat. We aren't told anything about the rental income but the implication is she can withstand the Section 24 wedge. I think the column is pretty illustrative of where the average landlord - not the Property 118 super-leveraged crew - is at the moment, but also shows the effect of the government deciding to keep property CGT at 28%. The govt does want to squeeze out BTL gradually, but it doesn't want to provoke a crash with a rush for the exits, and the 28% CGT is a good way of disincentivising existing landlords from selling. I hope she does not have to pay too much capital gains tax. The S24 reforms will have a slow and steady 'boiling the frog' effect. Most will stick their heads in the sand until it is really bad, then all hell will break loose. That will take care of the capital gains tax 'problem', as there won't be any gains to tax. Quote Link to comment Share on other sites More sharing options...
silver surfer Posted March 22, 2017 Share Posted March 22, 2017 1 hour ago, Patient London FTB said: To recap, she lets four properties in south London and has been aware of Section 24 for a long time but has been putting off a decision on what to do about it. Interesting article. It well illustrates why S24 will drive down house prices materially, but not necessarily in 2017 or even 2018. The landlords I talk to are aware of S24, but they're still in the mindset of "something will turn up". I know one who was crestfallen after the recent budget as he'd convinced himself Hammond would abandon S24. So, instead of grabbing the chance of getting out from under a broken business model now, they'll hang on until the tax bills actually start landing on their doormats, at which point it'll be too late for most of them because house prices will be ticking down. Slowly at first, so many will delay further in expectation of brief dip followed by a price recovery, but then the declines will accelerate as the S24 tax bills get bigger and the more leveraged landlords simply run out of time. Quote Link to comment Share on other sites More sharing options...
disenfranchised Posted March 22, 2017 Share Posted March 22, 2017 (edited) The real beauty of CGT isn't the fact that it causes unincorporated BTL sellers on their way to the exit screams of anguish (quite why the rest of us should pay a simultaneously calculated 20% or 40% tax and 12% NI on money we earn but they shouldn't pay 28% on money they didn't is quite beyond me)... The REAL beauty of CGT is they have to pay it to transfer the property into a Ltd company to avoid S24 if they are determined to stick it out. The ones who went IO in the south east 5/6 years back are going to be bent over This will definitely hit hardest in Slumdon Edited March 22, 2017 by disenfranchised Quote Link to comment Share on other sites More sharing options...
Pop321 Posted March 22, 2017 Share Posted March 22, 2017 On 20 March 2017 at 8:08 PM, PSP said: This has to smash the small BTL landlord into the ground ? Will this mean forced evictions ? Will this mean increased rent hikes for the bigger players as the supply pool becomes smaller ? Small leveraged landlord - yes. Avoids the direction of travel of 2 million LLs buying and owning 10 each buying all the UK stock. Then when rates rise (because non are repaying the debt) the house of cards collapsing. Evictions - yes. Surgeons knife. Hikes by bigger players - no. Unless of course the fancy the political wrath of rent caps. Bigger players will not have 80% leverage and tax deductions are capped (wow, not just small 118'ers) I like S24, I would have removed interest only debt altogether but this targets interest only in a more precise manner. It's all about debt and leverage.....but tricky to get off another agenda for the 118'er. Rates are 0.25%, only a numpty has been in the market over the past few years and doesn't now have the resource to repay any debt. If a 118'er can't repay the debt they have been shown the door before it's was too late for team UK. Quote Link to comment Share on other sites More sharing options...
disenfranchised Posted March 23, 2017 Share Posted March 23, 2017 29 minutes ago, Phil321 said: If a 118'er can't repay the debt they have been shown the door before it's was too late for team UK. This is what I don't think they get... The whole UK PLC thing. I checked the local rental market earlier and I was shocked to discover the 2 bed flats I exited 4 years ago paying £500 a month are being marketed at £650 now. 30% on rent for a 2 bed flat in 4 years? Utterly ridiculous. If "circumstances" put them back to £500 that's a whole lot more money available to spend. That's a whole lot less wage demand. The UK is going to enter a period where every stat on its economy will be minutely analysed VS the EU. Rents are cheaper in a lot of the EU, so wage demands are lower and disposable incomes are higher. Not a great starting point. I believe a rental and price slump is highly desirable for economic competitiveness. 35 square metre studio- central Berlin: €730 a month 27 square metre studio - central Paris: €960 a month But in London... Bethnal Green studio flat €1303 How can UK PLC compete when a Berliner needs to take home £400 less than a Londoner just to meet rent? I think a correction is highly desirable - the BTL brigade will suck a lot of it up and the banks are well placed now to absorb the rest. Quote Link to comment Share on other sites More sharing options...
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