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Fairyland

DT: 'Buy-to-let is my pension - but do the numbers stack up?'

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Telegraph: 'Buy-to-let is my pension - but do the numbers stack up?'

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The Government has been aggressively stripping away the potential benefits attached to investing in buy-to-let. George Osborne, the former Chancellor, increased the stamp duty surcharge on additional properties by three percentage points and from next year the ability to offset mortgage costs against rental income will start to fall away. In extreme cases, this could mean some investors will pay tax on losses.

 

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Pensions clearly beats a portfolio of just one property, but investors willing to take more risk – both in taking out mortgage and managing multiple properties – are well rewarded.

 

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Aside from the calculations, most would conclude that pension investing is far simpler than buying, maintaining and servicing a mortgage on a property.

“People think of pensions as risky but fail to see the risks in property.

 

Edited by Fairyland

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I believe this is just the beginning.  Could it be possible that further tax, welfare - rent and mortgage changes will put BTL LLs with 2-3 properties in losses?

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What's the big deal, other businesses pay tax on losses (employee's income tax, vat)? Why special?

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I suppose the argument for not being allowed to offset mortgage payments from rental income, is that unlike a business where you might have a loan to pay off (a loan that you took out in order to help facilitate your business, be that service, skills or production), whereas as a BTL you don't actually own "the business" and the loan (mortgage) is to actually buy "the business".

Apart from the obvious arguments of course which is that BTL et al is f*cking up the economy and affordable housing makes for a stronger economy and more of a meritocracy were an honest hard days work pays off.

https://www.tullettprebon.com/Documents/strategyinsights/TPSI_ArmaggaddonUSA_A4_spw_008.pdf (Page 28-30 capital sink investment: betting the house)

"From a strictly pragmatic perspective,governments should cultivate low rather than high property values. Lowprices would enable young people to find homes, would preclude the creation of damaging bubbles, would drive middle class Americans into greater investment diversity and, most important of all, would liberate capital for more productive investment....Fourth, and worst of all from an economic perspective, houses are capital sinks, which absorb investment without generating a return. In other words, tying up capital in property reduces national productivity. Borrowing to do this is folly, and borrowing from abroad for this purpose is the economics of the mad-house."

...and particularly relevant to this thread (albeit about the US, the same still applies:

"The high proportion of Americans’ wealth which is invested in property poses a major social and economic risk going forward, because of the ongoing retirement of the baby boom generation.The first boomers have now reached the age of 66, whilst even the youngest will reach retirement over the coming twenty years. Millions of these people expect to rely for their security in old age on monetising their assets, but no-one has explained quite how this is supposed to happen when the following generation is not only fewer in number but individually poorer.This argues for a further secular downtrend in property prices,undercutting millions of Americans’ assumed ability to enjoy a good quality of life in retirement."

Edited by Arpeggio

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21 hours ago, Arpeggio said:

I suppose the argument for not being allowed to offset mortgage payments from rental income, is that unlike a business where you might have a loan to pay off (a loan that you took out in order to help facilitate your business, be that service, skills or production), whereas as a BTL you don't actually own "the business" and the loan (mortgage) is to actually buy "the business".

Apart from the obvious arguments of course which is that BTL et al is f*cking up the economy and affordable housing makes for a stronger economy and more of a meritocracy were an honest hard days work pays off.

https://www.tullettprebon.com/Documents/strategyinsights/TPSI_ArmaggaddonUSA_A4_spw_008.pdf (Page 28-30 capital sink investment: betting the house)

"From a strictly pragmatic perspective,governments should cultivate low rather than high property values. Lowprices would enable young people to find homes, would preclude the creation of damaging bubbles, would drive middle class Americans into greater investment diversity and, most important of all, would liberate capital for more productive investment....Fourth, and worst of all from an economic perspective, houses are capital sinks, which absorb investment without generating a return. In other words, tying up capital in property reduces national productivity. Borrowing to do this is folly, and borrowing from abroad for this purpose is the economics of the mad-house."

...and particularly relevant to this thread (albeit about the US, the same still applies:

"The high proportion of Americans’ wealth which is invested in property poses a major social and economic risk going forward, because of the ongoing retirement of the baby boom generation.The first boomers have now reached the age of 66, whilst even the youngest will reach retirement over the coming twenty years. Millions of these people expect to rely for their security in old age on monetising their assets, but no-one has explained quite how this is supposed to happen when the following generation is not only fewer in number but individually poorer.This argues for a further secular downtrend in property prices,undercutting millions of Americans’ assumed ability to enjoy a good quality of life in retirement."

Does a BTL LL pay CGT and how much, 40%?

 

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BTL was shown in 2008 to be an idiotic investment.

 

8 years on now and prices at some sepculative frenzy level and people are still going for it.

Silly old pensioners using their pension fund money as deposits because IRs on savings at fec all.

The desperation is driving people to do insane things,

 

heads you hand your wealth over to the bankers

tails you hand your wealth over to the bankers

 

The greatest robbery in history, right before peoples eyes, better than that, they clamour to pay more, to be robbed more and eventually....they top of the pyuramid will abscond with their ill gotten gains leaving the people beloe them in a heap of ***t

 

 

Edited by TheCountOfNowhere

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40 minutes ago, Fairyland said:

Does a BTL LL pay CGT and how much, 40%?

 

No, the all move into the property for 2 years before selling...if you have 30 properties, that'll only take you 60 years.

 

Good luck BTL scum bags

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