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paul ireland

The Buy To Let Is Toppling Over

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:o Investing in Property & Housing

"You can't go wrong with bricks and mortar", they say. And with the phenomenal increase in house prices over the past 10 years, investing in property has looked like a dead cert. But is it now? After this incredible boom, is there going to be a gentle 'easing' of house prices, or are we in for an almighty property crash?

Here at MoneyWeek we have a very sceptical view of the housing boom. It seems clear to us that property prices are due for a serious 'correction', as the polite parlance goes. For our most recent in-depth analysis, where we investigate just how far things have got out of kilter, have a look at What's really going on in the property market? And for a shorter piece, try A desperately poor year for housing.

If that doesn't put you off, then you might be interested in investing in property via a REIT, or real estate investment trust:The UK's changing property market.

And even if you're wary of the UK market, you might like to look at opportunities in overseas property markets. Have a look at: Japan: a way into the coming property boom, and The backdoor route to Germany's undervalued property market.

Then there are all our other property articles listed below. And for all our very latest property market advice and analysis, sign up for our Free Trial.

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Not if you read todays Guardian...

BTL

<snip>

Buy-to-let landlords are swaggering again. Demand from prospective tenants is at a four-year high, rents are up and house prices are beginning to ease upwards.

The doomsayers who predicted landlords were in for a tough ride have been run out of town. Their predictions of a house price crash never materialised and a much-talked about glut of two-bedroom flats, far from flooding the market and driving down rents, actually failed to match demand in most areas.

A recovery in the housing market in recent months has also served to turn frustrated first-time buyers back to the rental sector.

</snip>

Those VI's are working overtime again!

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Some very deluded bears expect BTL to fall off a cliff and remove itself from the UK property scene.

Its here to stay and will grow over the years.

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The doomsayers who predicted landlords were in for a tough ride have been run out of town. Their predictions of a house price crash never materialised and a much-talked about glut of two-bedroom flats, far from flooding the market and driving down rents, actually failed to match demand in most areas.

That quote is so funny, you can just picture an angry, hooliganistic mob of BTL Landlords complete with burning sticks chasing the housing market "infidels" out of Town

:lol:

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Seems that ultra-low interest rates are keeping the BTL market up...

See:

West Bromwich BS Direct

0870 027 1346 1.79% Mar 2008 6.54% 6.0% APR 95% Overhang

...yes that is a rate of 1.79% for 2 years, you are tied in for a further 2 years at 6.54%

Now this seems a remarkable deal and what is keeping the market ticking over...

Now I have been thinking...

I have STRed (due to job and relocation within the country).

I'm seriously thinking if it would work out better if I bought a flat on similar BTL deal, minimum capital down and rent it out myself!!

After 2 years rent it out for another 2 years and then sell it. That would save a lot of £'s given that current rent is £600 mth thereby allowing me to save more for my proper home deposit. After 2 years hopefully houses are a bit cheaper and I can buy one of those??

The main drawback would be if property crashed hard then could I take a hit on the BTL property??

BTL flat would be around £100k.

Comments please...

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Some very deluded bears expect BTL to fall off a cliff and remove itself from the UK property scene.

Its here to stay and will grow over the years.

BTL has been here for ever and will always be here. However the deluded monkeys who are and have been jumping on the bandwagon for the last 2 years are the ones who will get hurt.

My local paper has more to lets than there are people to rent them. That can only mean one thing. Someones going to get hurt.

The landlord who has been in BTL for years bought his house cheap and can afford to reduce the rents. The monkeys who are buying now, not only cannot afford the voids, but have overstretched themselves to buy.

Examples of this are supermarket clerks who have two houses. SUPERMARKET CLERKS. renting houses out to bank managers. Oh my lord.... I know of this such example. The world of BTL is upside down. Eventually somethings going to turn it back up and all those on top will be crushed.

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Hmmmm, yeilds have definatley dropped though. Those who got into btl a few years back are laughing, the margins are much tighter now. My old Landlords yeild was 4.1% on the #270,000 he paid for the flat, factor in inflation, management costs, mortgage interest, dilapidations etc, and he was essentially breaking even/losing. There are other profitable avenues to invest that sort of money. I personally think that the growth in the private rental market is a good thing, it gives more housing options to people. The market should have been left to develop organically instead of the rent controls introduced years back, followed by the more recent financial liberalisation of the market.

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  • 301 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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