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Mapatasy

Is this a joke?

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Sadly, I do wonder if they're right.  

When I was younger the progression was something like

  • Crappy student house (mine had a rat infestation, damp, etc, but was dirt cheap) which taught you to cope with crap accommodation.
  • When you got a job you moved to an awful crappy (but not so bad as student house) rented place, perhaps in bad side of town, which taught you to put up with terrible neighbours.
  • When you'd been working a few years, you'd buy a tiny house, which was worse than the rented place, but you could work at it over the coming years to make it nicer, and although it would likely be in a bad part of town you could try to aim for  better than the previous place.
  • Later on you'd upgrade to a larger house, which was nicer again.

Now, this might be a bit off, but hopefully you see what I mean.

Nowadays we seem to be building expectations in the younger folk.  The new student accommodation being built is so often ensuite, quite well presented, etc.  I know it is more expensive and there is less choice, but the more recent student builds seems to be good quality.  So, how will the students cope with moving into crappy rented accommodation after college - perhaps they won't, perhaps they'll prefer to be in more expensive nicer accommodation.  And again, how will they put up with buying a crappy tiny house downtown, which would be so much worse than what they've got?  Perhaps they won't, they'll stick with their rented place. 

So maybe the build-to-rent model proposed is very much going to meet the requirements of the new generations of younger people.

BTW, I think that the 25-35 year olds possibly have the worst situation -- all the exposure to crap, but nothing they can do to actually make things much better.

[I might be far off -- not so much exposure to students, I'm afraid -- feel free to educate me.]

Edited by dgul

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Change the last word in the scam (BtL now BtR) and build them even tinier than ever.

Innovative - innovative for scams and crooks that is.

It has the smell of Hammond - along with a whiff of Carney - property speculator at the head of the treasury and vested interests in the BoE.

Sack them both - government needs cleansing of the wicked policies.

Edited by billybong

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I do not see the problem with 'build to rent' of itself. There are many (on these boards) who do not wish to have to tie up capital in owning real estate, or do not want overexposure to the risks and rewards of this asset class. I have had a temporary (12m) assignment to work in a city far away from where the family home was. It was far better to rent from a professional landlord - in a built to rent high rise - than from an accidental or amateur landlord. Living arrangements based on this model are common in most cities outside the UK - certainly in USA, Germany, Italy, France, Greece, Australia, Japan.

Having said that , I would certainly be wary of anything likely to hit the market in the UK. If the accommodation is as bad as the rabbit hutches that have been built all over in the past 20 years, then it is not wanted by anyone, at any price, Sadly, it is the least bad choice for some - whether such accommodation is rented or owner occupied.

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22 hours ago, hotairmail said:

Build to rent is far more preferable to Buy-to-let.

The former comes from increasing supply, the latter cornering it.

 Cornering the market sums it up.

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On 20/10/2016 at 3:36 PM, Mapatasy said:

Honestly, you sound far more disconnected from reality than these developers.

It is completely normal for people to want to rent housing for extended periods of their life.  If you're moving for a job and only plan on living in an area for a couple of years, it makes no sense to pay 2 years worth of rent in stamp duty on top of a mortgage for that time period.  And if you are going to be a tenant, it is far, far better to have a professional property manager rather than a fly-by-night amateur.

 

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We have a load of this in Toronto, mostly owned by pension funds and insurance companies looking for long term income. It works really well and cuts the shysters out of the loop, I don't see any problem with this at all.

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Just watch how many tax advantages etc the idea gets in due course along with the BtLers - compared to the average person who just wants to buy to live in.

Edited by billybong

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I don't have a problem with this as long as it's not the only game in town.

The problem with Britishfolk is that they won't have any savings by the time they want to start a family and will never be able to move away from this. 

 

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On 10/21/2016 at 10:22 PM, hotairmail said:

Build to rent is far more preferable to Buy-to-let.

The former comes from increasing supply, the latter cornering it.

Nope. In both cases they are hoarding residential land and that is what matters.  

Supply is unchanged but demand is increased. 

Edited by BuyToLeech

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12 hours ago, StainlessSteelCat said:

Build to rent is a good idea - but the reality is (for Britain at least) that these will end up being poorly managed, grotty and expensive. 

+1

It is also likely to be promoted and financially incentivised by government above self build or any measures to reduce prices. May the exploitative property market continue.

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So they've decided to build record low numbers of new homes and let big companies corner the market (despite the regular mentions of 1 million new homes by 2020 apparently they're still building record low numbers) - a situation created by allowing record high house prices so that increasing numbers of young people and increasingly the middle aged can only afford to rent.

 

Edited by billybong

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14 hours ago, TheBlueCat said:

We have a load of this in Toronto, mostly owned by pension funds and insurance companies looking for long term income. It works really well and cuts the shysters out of the loop, I don't see any problem with this at all.

I guess it's no coincidence that Canada has record high house prices as well (I'm not saying that to date the high prices are a consequence of the company owners).  

Edited by billybong

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3 hours ago, BuyToLeech said:

Nope. In both cases they are hoarding residential land and that is what matters.  

Supply is unchanged but demand is increased. 

This is about the stupidest comment I have ever read on HPC.  Clearly, if one involves building new units and the other involves simply buying existing units, one expands supply and one doesn't.  If you can't even do basic maths or understand basic English language, then, please, stop trolling on here.

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1 hour ago, Parkwell said:

+1

It is also likely to be promoted and financially incentivised by government above self build or any measures to reduce prices. May the exploitative property market continue.

One question is will it result in more new units being built - typically will planning permission be more relaxed as the big companies (Build to Rent companies - pension funds and insurance companies?) might have more "leverage".  Currently new home building is at record lows and has been increasingly so for about 7 or 8 years now.  One assumes they will be building new homes and not just refurbishing existing units under the tax pretext of build to rent.

Another question is who are they for - locals or others.  So where will they be built - it would make sense where any extra jobs are but the way income is structured these days it could just as easily be in benefit and tax credit areas.  

Edited by billybong

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14 hours ago, TheBlueCat said:

We have a load of this in Toronto, mostly owned by pension funds and insurance companies looking for long term income. It works really well and cuts the shysters out of the loop, I don't see any problem with this at all.

Just what I was thinking. We even have then up here in Barrie...great idea. Basically funds that build these are residential REITS. Investors can choose the level of exposure, keep it in a pension fund and never burst into tears when a place gets trashed.tenants get a consistent level of quality, service and amenities and if they don't, they can trash the organisation on social media etc and put other renters off. This model is much better than BTL. Also the properties tend to be purpose built high rises in city centers and don't compete with FTBers.

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Will these new developments specifically for Build to Rent mean that fewer building resources will be available to build new homes that people would want to buy just to live in (not to BtL).  Homes for living in will be competing for building resources with Build to Rent.  

Especially when some government sources claim that the British building industry is very low on resources - people and materials - so much so that they can't meet the new homes target they keep claiming to set.

This is all mainly a consequence of crazy house prices and the current levels of population growth.

Edited by billybong

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15 hours ago, TheBlueCat said:

We have a load of this in Toronto, mostly owned by pension funds and insurance companies looking for long term income. It works really well and cuts the shysters out of the loop, I don't see any problem with this at all.

 

14 hours ago, StainlessSteelCat said:

Build to rent is a good idea - but the reality is (for Britain at least) that these will end up being poorly managed, grotty and expensive. 

In theory BTR could be a good idea, the practice is likely to be greedy companies chasing profit rather than trying to provide a service (i.e. decent & sensibly priced rented accommodation) - which is liable to turn in into a disaster. 

9 hours ago, stuckmojo said:

I don't have a problem with this as long as it's not the only game in town.

The problem with Britishfolk is that they won't have any savings by the time they want to start a family and will never be able to move away from this. 

 

And the odds are greedy companies chasing profit will keep rents up to prevent tenants moving on........

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3 hours ago, richc said:

This is about the stupidest comment I have ever read on HPC.  Clearly, if one involves building new units and the other involves simply buying existing units, one expands supply and one doesn't.  If you can't even do basic maths or understand basic English language, then, please, stop trolling on here.

Oh dear, no.

Neither building to let nor buying to let increases the supply of residential land, and it is the price of residential land that is the problem.  

Both increase the demand for residential land and therefore increase the price of houses.

Granting planning permission does increase the supply of residential land. That's a good thing, but it is a power of the state, and has nothing whatsoever to do with landlords. 

Once permission is granted build to rent Landlords only increase the demand for land with planning.  That land could be bought by someone who wished to build a house to live in.  

According to your naive theory, if I sell land to a build to let developer then that has a different market impact compared to building a house and selling the completed house to a buy to let landlord.  

Clearly nonsense.

Despite the popular obsession with housing, most people's common sense understanding of the housing market is completely at odds with reality.  That is no accident.  You have been trolled, but not by me.

 

Edited by BuyToLeech

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4 hours ago, billybong said:

I guess it's no coincidence that Canada has record high house prices as well (I'm not saying that to date the high prices are a consequence of the company owners).  

I don't think that's really connected - we have far more in the way of privately owned stuff. I'd say that high house prices here are much more to do with low interest rates and the lack of land to build on near where the jobs are. Having said that, central Vancouver and Toronto aside, houses here are still way cheaper than the UK.

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