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Rental market chaos as tenants struggle to pay and 80,000 landlords fear bankruptcy


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Rental market chaos as tenants struggle to pay and 80,000 landlords fear bankruptcy

Concerns that properties may not be in a habitable state after lockdown

The coronavirus crisis has plunged the rental market into turmoil as tenants struggle to pay bills and landlords fear financial ruin.

Property owners are struggling with unexpected costs and are concerned that when the outbreak is over they may be left with rental homes that cannot legally be let.

According to one estimate, as many as 80,000 landlords may be forced to quit the sector.

One in five private tenants face losing their job, and Shelter, the housing charity, has warned that gaps in the social security system could mean renters are in financial trouble long after the pandemic ends.

The Centre for Economics and Business Research, a consultancy, said that the issues facing the rental sector would be “the catalyst of the impending housing crash”....

https://www.telegraph.co.uk/investing/buy-to-let/rental-market-chaos-tenants-struggle-pay-80000-landlords-fear/

Edited by spacedin
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Oh well - they can just flog the homes at a knock down price to a first time buyer nurse or doctor or care worker who really deserve our sympathy.

Financial ruin - or just an end of the rentier get rich quick off the back of others' monthly wage packet brigade who add no real value to society.

Edited by MARTINX9
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11 minutes ago, MARTINX9 said:

Oh well - they can just flog the homes at a knock down price to a first time buyer nurse or doctor or care worker who really deserve our sympathy.

Financial ruin - or just an end of the rentier get rich quick off the back of others' monthly wage packet brigade who add no real value to society.

They should make a TV programme about that, maybe call it 'homes under the hammer'. 

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29 minutes ago, spacedin said:

They should make a TV programme about that, maybe call it 'homes under the hammer'. 

Or alternatively 'property snakes forced off the ladder'?

Escape to the country will get recommissioned anyway. Half the country will want to escape the big cities when this is ok - the Highlands and rural Ireland may well see a price boom as prices collapse in London, Edinburgh and Dublin!

Edited by MARTINX9
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2 hours ago, spacedin said:

Rental market chaos as tenants struggle to pay and 80,000 landlords fear bankruptcy

Concerns that properties may not be in a habitable state after lockdown

The coronavirus crisis has plunged the rental market into turmoil as tenants struggle to pay bills and landlords fear financial ruin.

Property owners are struggling with unexpected costs and are concerned that when the outbreak is over they may be left with rental homes that cannot legally be let.

According to one estimate, as many as 80,000 landlords may be forced to quit the sector.

Absolutely nothing constructive in this post, I just wanted to say:

 

Nelson2.gif

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There is another article linked in this article which I was about to post, but saw this thread. It is just dripping with Bear honey:

April 5th article on landlord losses

There is a key point in here about AirBNB. 45% of UK Airbnb listings have been withdrawn, with many now advertised as long term lets. This is adding petrol to the fire. Airbnb bookings won’t recover for the rest of the year as even those with money will probably not plan holidays ahead until they are sure no new outbreak is on the horizon. So you have the double whammy of tenants throwing the keys back at the landlord, and new properties being listed. Landlords will not get bailed out...political suicide for the Tories, which means there will be lots who have to sell up, and they will join those who are forced to sell their houses for other reasons. 

“Landlords will suffer the effects of lockdown long after coronavirus restrictions are lifted as tenants fail to pay, viewings grind to a halt, vacancies rise and new rental properties crowd the market.

Tenants are more likely than homeowners to have insecure employment contracts and little in savings to fall back on. Many have already struggled to pay rent as salaries have fallen and jobs have been furloughed.

Some will be forced to leave cities when rental contracts expire and return home, perhaps to parents’ houses or overseas, leaving landlords with empty properties.

Buy-to-let investors must prepare for monthly rents to fall. Supply has started to outstrip demand as new properties have joined the rental market. In London, a large number of homes that were previously listed on short-term rental websites such as Airbnb have swamped the market as tourists have cancelled bookings. These properties are now being advertised to long-term tenants at lower prices.”

 

Edited by HovelinHove
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Is it just me or has the DT become massively bearish in every aspect of the UK property market, even caught an article the other day suggesting prices crashing might actually be a good thing for the greater good, pigs flying and all that, they really have changed their tune

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31 minutes ago, highcontrast said:

Absolutely nothing constructive in this post, I just wanted to say:

 

Nelson2.gif

Don't we all ?

I have actually had no end of people say to me "you still have to feel sorry for them", no you f****** well don't. How many non homeowners have had their noses rubber in it over the years, even had the knife stuck in  and twisted. There was once an argument not to legalise the ban on  kids going down coal mines and chimneys as it would damage the industry and destroy peoples income

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6 minutes ago, crumblingcon said:

Is it just me or has the DT become massively bearish in every aspect of the UK property market, even caught an article the other day suggesting prices crashing might actually be a good thing for the greater good, pigs flying and all that, they really have changed their tune

The Mail have been as well. Interesting that they are both Tory papers, yet happy to fuel the impending crash. Maybe they view it as better to lance the boil now and blame a crash on COVID than prop it up and be unpopular with millennials etc.

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18 minutes ago, HovelinHove said:

The Mail have been as well. Interesting that they are both Tory papers, yet happy to fuel the impending crash. Maybe they view it as better to lance the boil now and blame a crash on COVID than prop it up and be unpopular with millennials etc.

It always cracked me talking to that thick type of BTL "lets copy everyone else" landlord, because they are not all thick, who told you their plan where they get the properties paid off by tenants over  25 years and then ride off into the sunset with all the money that a handful of properties brings you. It just never dawns on them that 25 years is a long way to and governments can turn on you in a nano second if the electorate wish it

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2 hours ago, MARTINX9 said:

Or alternatively 'property snakes forced off the ladder'?

Escape to the country will get recommissioned anyway. Half the country will want to escape the big cities when this is ok - the Highlands and rural Ireland may well see a price boom as prices collapse in London, Edinburgh and Dublin!

I love the new programme title.?

Regarding the rural VS metropolitan property markets, who could not resist, for example, forking out £425K for a nice, one bed flat off the Old Kent Road, with splendid views of the neighbouring warehouse sheds, to spend the next Corona wave lockdown in. 

https://www.rightmove.co.uk/property-for-sale/property-86593799.html

 

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I wonder if the  right wing press now realises high property prices are ruining the economy. Let's face it, if £Trns are tied into property and mortgage repayments, then the upcoming generations will have nothing to spend. 

My first house house had a £850 pcm mortgage back in 2000 and the mortgage value was about £120k based on a purchase price of £135k.   The house has since sold in 2017 for £374k, with zoopla saying it now worth £425k. It was a pretty, but small 2 up 2 down in a Surrey village - who would buy that for £400k? I assume that is a £2k pcm mortgage for a FTB, about what I pay now for a house that is at least 6 times the square footage. 

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4 hours ago, MARTINX9 said:

Oh well - they can just flog the homes at a knock down price to a first time buyer nurse or doctor or care worker who really deserve our sympathy.

Financial ruin - or just an end of the rentier get rich quick off the back of others' monthly wage packet brigade who add no real value to society.

That's right it only the nurses who need housing and those poor care workers, last time I looked nurses pay and conditions looked far better than average incomes in many parts of the country.

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6 hours ago, MARTINX9 said:

Or alternatively 'property snakes forced off the ladder'?

Escape to the country will get recommissioned anyway. Half the country will want to escape the big cities when this is ok - the Highlands and rural Ireland may well see a price boom as prices collapse in London, Edinburgh and Dublin!

Not sure if you’ve noticed this, but there aren’t many jobs in the “country”. Londoners may try to sell up there “million” pound homes to buy something “cheap” in the country, but they won’t be alone, and they won’t get their million. London will lead the way down as it leads the way up. vast number of amateur landlords going bust and having to sell, plus lots of jobs up in smoke, and people just wanting to leave...oh and Brexit. Prices will crater quickly in London, maybe 20% by end of this year. Then the rest will follow. If they don’t get their million, they can’t spend it in the country. Prices everywhere are going south big time.

Edited by HovelinHove
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5 hours ago, crumblingcon said:

Is it just me or has the DT become massively bearish in every aspect of the UK property market, even caught an article the other day suggesting prices crashing might actually be a good thing for the greater good, pigs flying and all that, they really have changed their tune

Its click bait - as we know the majority of Brits are property obsessed so bad news articles will drive a lot of traffic.

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6 hours ago, Take Me Back To London! said:

I love the new programme title.?

Regarding the rural VS metropolitan property markets, who could not resist, for example, forking out £425K for a nice, one bed flat off the Old Kent Road, with splendid views of the neighbouring warehouse sheds, to spend the next Corona wave lockdown in. 

https://www.rightmove.co.uk/property-for-sale/property-86593799.html

 

I have inherited half a 3 bed house in rural south west Ireland with my sister. It’s half a mile from the nearest house and apart from the postman hardly anyone drives by all day. But only 30 mins drive from an airport with two daily flights to London. Perfect lockdown location - even has a small garden to grow food.

Current market value - about £65k!

Did think of escaping there when this started but didn’t want to worry about infecting the locals!

 

 

 

 

Edited by MARTINX9
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So people have taken on a investment and are now finding this could lead to losses and bankruptcy. Do they think they are JP Morgan or Goldman Sachs with all losses underwritten by the Fed???

 

Investment is a risk you could get a profit or a loss. That's the whole point of capitalism.

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21 minutes ago, fuzzy_bear said:

Assuming no one has read the article -  It's behind a paywall - does anyone on here actually have a subscription to the Telegraph?? 

 

 

The coronavirus crisis has plunged the rental market into turmoil as tenants struggle to pay bills and landlords fear financial ruin.

Property owners are struggling with unexpected costs and are concerned that when the outbreak is over they may be left with rental homes that cannot legally be let.

According to one estimate, as many as 80,000 landlords may be forced to quit the sector.

One in five private tenants face losing their job, and Shelter, the housing charity, has warned that gaps in the social security system could mean renters are in financial trouble long after the pandemic ends.

The Centre for Economics and Business Research, a consultancy, said that the issues facing the rental sector would be “the catalyst of the impending housing crash”.

A report by the National Residential Landlords Association (NRLA), seen exclusively by Telegraph Money, shows the scale of issues facing the sector. It warned that many landlords and tenants had fallen through the cracks of government support schemes.

Landlords with a buy-to-let mortgage can claim a payment holidayfrom their bank and use this saving to support struggling tenants. However, the NRLA said thousands of investors own rental properties outright and thus cannot provide help.

About 28pc of landlords do not have a mortgage, it said, and many of these rely on rental income for their livelihoods or to fund their retirement. In some cases, the crisis has caused this income to fall.

The NRLA said it had received reports of tenants cancelling their rent payments because they wrongly believed they no longer had to pay. It is also concerned renters who have agreed a payment break do not realise they still have to pay back the money.

Landlords with vacant or soon-to-be-empty properties cannot let these to new tenants and will incur council tax and utility bills while empty. A survey by the NRLA of 2,700 landlords found that 41pc had found it hard to cover unexpected costs. In addition, 3pc expected to lose their business because of coronavirus.

According to Hamptons International, the estate agent, there are 2.3 million landlords in Britain, suggesting 79,800 could go bust.

Those landlords who have tried to refinance their properties have limited options. Moneyfacts, the financial analyst, said that more than 1,300 buy-to-let loans have been withdrawn since the crisis began.

The NRLA’s Chris Norris said: “Some landlords may need to sell up as soon as they are able, this only exacerbates the rental supply crisis.”

Mr Norris said that the Scottish government had offered support to landlords without mortgages, but those elsewhere could not benefit.

Shelter has warned 1.7 million private renters in England could lose their jobs in the next three months, equivalent to one in five private tenants.

Many of these people will be forced to turn to the welfare system for the first time, but the housing benefit element of Universal Credit only covers the cost of renting the cheapest 30pc of properties in an area. So renters paying average prices face a shortfall. For a two-bed family property, the gap is as high as £400 a month in England, while the difference is £1,227 in London.

This issue would be alleviated by tenants moving to cheaper properties, but that is not an option during the lockdown. The Government said that it had offered “unprecedented measures to support tenants”.

However, there are new fears that many homes will no longer be in a lettable state when the outbreak ends, as gas, electricity and other safety certificates will have expired.

While engineers are considered key workers, the NRLA said many landlords had found it hard to get works carried out because contractors were reluctant to enter properties or because tenants have coronavirus symptoms.

 

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46 minutes ago, interestrateripoff said:

So people have taken on a investment and are now finding this could lead to losses and bankruptcy. Do they think they are JP Morgan or Goldman Sachs with all losses underwritten by the Fed???

 

Investment is a risk you could get a profit or a loss. That's the whole point of capitalism.

Indeed.

The special pleading is mind boggling. It's not diversified, it's not insured, and it's not regulated.

Tough sh#t chaps.

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8 hours ago, dirtysteve said:

In some cases, the crisis has caused this income to fall.

Yes, just like people with investments in shares. Why do landlords think they deserve special treatment.

It is astounding the number of ****** landlords. What is it about that role that attracts so many?

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  • 418 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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