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roblpm

Incredible Bull In The Guardian

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I like the bit where it mentions 1-2% yields!!

http://money.guardian.co.uk/property/buyin...1722916,00.html

It reads like an 'advertorial' paid for by Paragon Mortgages et al...

Just a thought: we're seeing a lot of the lending criteria being relaxed to encourage more investors.

Million dollar question: if there are so many people piling into BTL, why relax the criteria?

Smacks of desperation to me.

<_<

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"
John Bradburne of local agents Bradburne & Co says that while yields might seem low initially, they creep up. "I tell people they can expect 1% to 2% in the first few years but by year 10 it will be more like 7% or 9%. There is demand here from buyers and tenants for everything from ex-council homes to Victorian villas
."

Who, in their right mind, would risk any money in an investment with yields well below the rate of inflation? Add the "risk" that the housing market will fall further and you have perhaps the worst possible invesment on the planet next to a KFC franchise in Tehran. Perhaps these BTL Bullsh***ers think they have the sheeple so spellbound that anything is an investment if it is bricks and mortar?

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If more people are buying btl and thus increasing the supply of rental property, then where is the demand coming from to justify the upward pressure on rents?

This article is propaganda.

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As Chomsky says, read the last few paragraphs to get the real news:

The big mortgage companies have also relaxed restrictions on landlords. Whereas Nationwide (through its UCB Home Loans subsidiary) used to limit landlords to two buy-to-let mortgages, now it will give them up to 10 each. The lender is joining an extraordinary rush by other banks to grab a share of the new lending boom. A few weeks ago, HBoS raised the lending ceiling on buy-to-let landlords from £2m to £5m. Paragon already has a £10m limit.

The banks used to want rental income to equal at least 130% of the loan repayments. That's now dropped to 125% and in some cases has gone as low as 100%.

New lending boom? ********. Lenders have targets. As soon as one lot (the FTBs) dry up, they target other sectors. Read this as the last dying gasp of the market. I like the bullish spin on the article; a total misrepresentation of what's happening.

Edited by Mr Blek

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These guys clearly have no idea of how to price an asset. The only recommendation I would make on an asset yielding 1%-2% is to short the s**t out of it...

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This is almost an exact copy of a similar piece that appeared in the Times a couple of days ago, somebody on here did the sums put forward by Paragon and they were in total contradiction, house prices had risen in excess of rental demand so the yield was even less... it seems the article wanted to put forth the concept of rental and capital increases and got caught in a double-bind.

Some of these journos are lazy mofo's, I amazed they have the audacity to put their name on the piece. I wonder how much it costs to buy a shill like Phillip Inman?

Million dollar question: if there are so many people piling into BTL, why relax the criteria?

Smacks of desperation to me.

And why are the "off the shelves" Land Registry volumes the lowest in 6 months?

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Some of these journos are lazy mofo's, I amazed they have the audacity to put their name on the piece. I wonder how much it costs to buy a shill like Phillip Inman?

They can get away with sloppy journalism simply because the readers tend to be sheep.

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anybody who reads someone else view as facto is a sheep.

these news reports are just other opinions of such news.

every paper has some kind of slant on it.

i dont read them. dont buy them and the bbc news i read between the lines of.

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Given that most people own their own home (subject to a mortgage) they will tend to shy away from any newspaper that suggests that their number one asset (liability??) is going down in value. We tend to ignore what we don't want to hear. No wonder Journo's just repeat the VI garbage that is churned out every month as there is no reward for investigative journalism. The press already regard HPC.co.uk as a forum for nutters so what else can you expect.

Our best friend in the journalism world is the DT because they have an agenda: get David "Scotty" Cameron elected.

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anybody who reads someone else view as facto is a sheep.

these news reports are just other opinions of such news.

every paper has some kind of slant on it.

i dont read them. dont buy them and the bbc news i read between the lines of.

I love the Beeb, they sometimes spin so hard it boomerangs straight back at them out of sheer pomposity.

Take today's reporting of our virtuous politicians for example; "He took money from a mafia crook" becomes "He is thought to have links with a Sicilian businessman".

That's slick :lol:

Edited by BuyingBear

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"
John Bradburne of local agents Bradburne & Co says that while yields might seem low initially, they creep up. "I tell people they can expect 1% to 2% in the first few years but by year 10 it will be more like 7% or 9%. There is demand here from buyers and tenants for everything from ex-council homes to Victorian villas
."

Who, in their right mind, would risk any money in an investment with yields well below the rate of inflation? Add the "risk" that the housing market will fall further and you have perhaps the worst possible invesment on the planet next to a KFC franchise in Tehran. Perhaps these BTL Bullsh***ers think they have the sheeple so spellbound that anything is an investment if it is bricks and mortar?

Can't quite see how this works. Rents would have to increase 18% a year year on year for this to make sense against the original investment.

The fact that they have relaxed their lending requirements suggest that the punters with the sort of investment security that they previously required has dried up. To get new borrowers they have to take a greater risk - they are probably also charging higher interest rates on the loans.

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Guest horace

I like the bit

"......house prices are beginning to ease upwards."

What a howler!!!

horace :):):)

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Isn't it strange how these former lefty papers are now gung ho on the capitalism of HPI? Gordon has done a good job of brainwashing even the Times which is a rabidly pro-HPI paper these days. Ironic that David "Scotty" Cameron is having to take the slightly left of center ground to rescue the nation (as the Libdems go off into lah lah land as usual!).

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If more people are buying btl and thus increasing the supply of rental property, then where is the demand coming from to justify the upward pressure on rents?

This article is propaganda.

According to the guff in the local free paper its immigration.

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At the bottom of the article: -

Advertiser links

15% Deposit Buy-to-Let Mortgages

UK homeowner with a 15% deposit? Fill in just one fast easy...

apply-for-a-loan.com

UK Buy-To-Let Mortgages

Need some help? Introduction to mortgage brokers. Apply...

thefinancewebsite.co.uk

15% Deposit Buy-to-Let Mortgage Enquiry

Complete a quick, no-obligation form and a specialist good...

1st-online-finance.co.uk

Wonder who's pulling this Puppet's strings?......

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Isn't it strange how these former lefty papers are now gung ho on the capitalism of HPI? Gordon has done a good job of brainwashing even the Times which is a rabidly pro-HPI paper these days. Ironic that David "Scotty" Cameron is having to take the slightly left of center ground to rescue the nation (as the Libdems go off into lah lah land as usual!).

For the last 9 years under the guise of a Labour Government we have had a more right-wing agenda than even John Major would have dared!!

Maggie T must be proud of her golden boy Blair. The real story is that we have had a right wing stooge as PM in a so called left wing party!!

Let's get the tories back in. It will be nice to get back to the centre ground :):)

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Here it is, need to go on a writing course myself though!!

Re your BTL article:

http://money.guardian.co.uk/property/buyin...1722916,00.html

As a long term Guardian reader I am dissapointed in the lack of analysis in this article. You seem to base your argument exclusively on information from bodies who have a vested interest in property prices going up and BTL mania:

RICS

Paragon mortgages

London and country mortgages

2 Estate Agents

Where is the balance in this article? And a few days later from the Times.........

http://www.timesonline.co.uk/article/0,,2097-2069621,00.html

and I quote:

Still, on the plus side, most investors aren’t falling for this drivel. They know that buy-to-let is a losing proposition so for the past two years they’ve been looking elsewhere.

Since when has the Guardian become a spokesperson/salesperson for big business who want to ramp house prices and BTL. There are many contrary indicators to your story:

OECD says UK house prices overvalued

Year on year price falls in part of UK (from Land registry data not spin)

Interest rate futures predict rate rise:

http://www.futuresource.com/quotes/quotes.jsp?s=LSS

Rising interest rates in US and Eurozone

etc etc

This is a very unbalanced piece of journalism.

Regards

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Letter written...no expectation of publication: the Grauniad is nothing more than an apologist-rag for champagne-socialist scumbags who proudly proclaim that they use fair-trade coffee in their enemas. No, really.

I can't stand this brand of self-righteous f**ker. God help us, bring the Tories back in.

Dear Sir,

I have just read your piece of blatant propaganda on the state of the BTL market [bTL bounces back..gently, Sat 4th March]. Can you please answer a very serious question that I have: namely, do you just receive these 'articles' as press releases from vested interests in the property market, and then publish them verbatim?

I ask this because I have, with mounting dismay, noticed increasingly slanted economic reporting in the Guardian. I ascribe this to either (a) the natural financial naivetey of a left-wing newspaper or (B) a worrying indication that you have in fact at some point sacrificed your principles, and climbed into bed with certain parties that have an interest in the publication of misleading and often downright wrong articles - either in the form of the journalistic laziness that I have alluded to in the first paragraph, or something more sinister. I am unsure of what to make of an article that is so blatantly a piece of propaganda rather than news.

Anyway, giving you the benefit of the doubt and assuming you are simply suffering from affliction (a), I will take here the opportunity to just point out a few discrepancies and untruths in your article in the hope that you will not try and print something so silly in the future...here they are:

1) If investors are piling back into BTL in such numbers as RICS would claim, why are the lending criteria applied by lenders to these investors being relaxed?

2) Given the upbeat tone of the article, can the author please explain to me what is so good about an investment which has (i) high transaction costs, (ii) an increasing likelihood of capital depreciation, despite what the vested interests say and (iii) a yield of 1 to 2 %. Is this meant to be a joke? Seriously.

3) Again, if so many BTL investors are piling in, then why are the Land Register 'off the shelves' figures the lowest in 6 months?

4) You state that 'A recovery in the housing market in recent months has also served to turn frustrated first-time buyers back to the rental sector.' This is reported as if the inability of FTBs to be able to afford a modest first-rung home in over 90% of the country is something to be happy about. Do you think a two-tier 'rentier' society is something that sits easily with the vaunted socialist position of your paper? Perhaps it sits more easily with the champagne-socialism of liberals like your own Will Hutton who combine left-wing soap-box posturing with large property interests?

5) At the bottom of the article, there are several links to mortgage lenders (apply-for-a-loan etc...). A bearish article on housing investment would not sit well with these revenue sources; does this fact colour the quality of your impartial 'journalism' in any way? Surely not.

This article can be measured alongside many others that you have written which are highly questionable: I have watched the decline of the Guardian over recent years, and it saddens me. This is to the point where I am unfortunately forced to believe that journalistic integrity has now left your newspaper. However, I would warn you: the explosion of bias-free, detached, and highly intelligent economic, financial and social analysis now available on the internet shame the sponsored rubbish that has increasingly become your hallmark.

Disgusted,

Marko

Edited by marko

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"I tell people they can expect 1% to 2% in the first few years but by year 10 it will be more like 7% or 9%"

Of course, yield = value of income payments / current market value

so there are two ways yields can go up :lol:

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The thing that puzzles me is that they mention loan repayments being covered 100-130% by rental repayments, and then 1-2% yields. That must mean net yields then?

Edited by CapeFear

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Got a response!! Cant be arsed to reply though ................ any ideas? Interesting he says will feature any examples! Obviously just repeats any stuff he is sent!

Dear Robert

Thank you for your letter. I agree that buy-to-let may prove to be a

terrible mistake for some people. Balance is provided by our very own

Buy-to-Let investor, Vanessa Whitting, who bought a new build flat,

discovered damp and suffered several voids. An update on her situation is

expected in the next few weeks. Her example is not isolated but there are

probably more people still nursing losses from the stock market crash.

At the moment, over valued or not, property continues to enjoy favourable

long term support, not least from a chronic shortage of homes and

demographic changes that have increased demand. With no crash in sight,

investors can accept low yields at the outset believing that any rent rises

will increase yields in subsequent years. And if they last the course there

is a whopping terminal bonus.

If you have examples of other people who have suffered problems with

buy-to-letting, please tell us and we will feature their story.

regards

Phillip Inman

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EA says:

""I tell people they can expect 1% to 2% in the first few years but by year 10 it will be more like 7% or 9%"

The surprising thing is, some gullible fools even listen

- -

Good letter, Marko.

But they will never publish it because it puts the Guardian in too negative a light

Worth a try though. They did publish a letter from me expressing great scepticism about BTL - back in Autumn 2005.

(But seriously I would suggest just stating your reasoned argument about BTL rather than wrapping it up in a frontal attack on their editorial standards. For most journalists that sort of stuff just smacks of green ink - and they will ignore it.)

Edited by New Bear

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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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