Jump to content
House Price Crash Forum
Sign in to follow this  
in2perspective

We're Writing A Special Report On 'selling To Rent'

Recommended Posts

I am in the process of writing a special report for our website on "Selling to Rent In2Perspective".

As the property market hasnt yet crashed if you think it is about to, then Spring 2006 could well turn out to be the best possible time to Sell to Rent.

We are collating information from a variety of sources and would really appreciate your help. Please let me know your thoughts on:

The pros and cons of STR;

Sources of information on STR;

People you would recommend we spoke to.

It would be great to hear from people who have already Sold to Rent or are thinking of doing so? And those who havent and their reasons for not STR.

Thanks in anticipation...I think STR is about to become a hot topic again in the press and we want to make sure UK homeowners have access to the facts. The report will be free and I will let you know when it is finished.

Either post on this thread or contact me. If you want to do so confidentially I shall of course respect that.

Yours,

Nick Booker

nick@in2p.co.uk

07957 390 289

Share this post


Link to post
Share on other sites

Not enough decent 4 bed houses available in the right areas to make STR an attractive proposition if there's a family / education involved.

Share this post


Link to post
Share on other sites

Nick if you don't get much of a response now it would be worth bumping the thread back up this evening when folks get home from work. I'm sure you will get enough information on STR to write an article or two from here.

Share this post


Link to post
Share on other sites

Hi

1) Transaction Costs

2) If house prices move even a small amount then you are losing. 2% HPI on a 90% geared house will produce a 20% ROCE

3) Rents tend to rise

4) Family upheavel

5) Can't improve the house, so no chance to add value

6) Owning a house is tax efficient, PPR is cap gains tax free whereas any investment with the equity will attract tax.

Advantages

1) Can freely move

2) Prices might fall at some point, and so you might be able to buy back cheaper

Share this post


Link to post
Share on other sites
Guest consa

I am in the process of writing a special report for our website on "Selling to Rent In2Perspective".

As the property market hasnt yet crashed if you think it is about to, then Spring 2006 could well turn out to be the best possible time to Sell to Rent.

We are collating information from a variety of sources and would really appreciate your help. Please let me know your thoughts on:

The pros and cons of STR;

Sources of information on STR;

People you would recommend we spoke to.

It would be great to hear from people who have already Sold to Rent or are thinking of doing so? And those who havent and their reasons for not STR.

Thanks in anticipation...I think STR is about to become a hot topic again in the press and we want to make sure UK homeowners have access to the facts. The report will be free and I will let you know when it is finished.

Either post on this thread or contact me. If you want to do so confidentially I shall of course respect that.

Yours,

Nick Booker

nick@in2p.co.uk

07957 390 289

And I have asked you guys for info via e-mail twice , to no avail, so why should I help?

Share this post


Link to post
Share on other sites

And I have asked you guys for info via e-mail twice , to no avail, so why should I help?

I'm sorry to hear that. We always reply to messages so I cant think why you didnt receive a response. Please feel free to email me and I shall reply - I promise!

Obviously, I have my own personal opinions and have written a great deal on property but please keep your points coming. It is interesting to see the different views and the priority certain arguments are given.

Thanks.

Share this post


Link to post
Share on other sites

Hi

1) Transaction Costs

2) If house prices move even a small amount then you are losing. 2% HPI on a 90% geared house will produce a 20% ROCE

3) Rents tend to rise

4) Family upheavel

5) Can't improve the house, so no chance to add value

6) Owning a house is tax efficient, PPR is cap gains tax free whereas any investment with the equity will attract tax.

Advantages

1) Can freely move

2) Prices might fall at some point, and so you might be able to buy back cheaper

I'm sure you can think of more advantages than that if you really tried :lol:

3) Prices may fall signficantly and you maybe able to buy a property outright for cash.

4) You may be able to bank the money and let the interest pay for your rent on a differnt property.

5) You may even be able pay the rent on a property and have surplus for 'other' investments.

6) You may miss a negative equity trap if you leave the market at the right point (assuming a large correction)

7) It is the landlords responsibility to maintain the property you now live in.

Its a gamble no one would deny that, its dependant on timing and market direction. It could be the worst move you've ever made or the best move. It is a very individual thing, everyones circumstance are differnt financial, marital, parental and emotional.

And I have asked you guys for info via e-mail twice , to no avail, so why should I help?

ahh didn't realise that consa mate :angry:

Share this post


Link to post
Share on other sites
Guest consa

I'm sorry to hear that. We always reply to messages so I cant think why you didnt receive a response. Please feel free to email me and I shall reply - I promise!

Obviously, I have my own personal opinions and have written a great deal on property but please keep your points coming. It is interesting to see the different views and the priority certain arguments are given.

Thanks.

Can't be bothered to e-mail, so I will ask you here, will it be possible to use some of your excellent graphs on my website as they are copyrighted, I will in return place a link on my site, and help you collate your info here.

Edited by consa

Share this post


Link to post
Share on other sites

Can't be bothered to e-mail, so I will ask you here, will it be possible to use some of your excellent graphs on my website as they are copyrighted, I will in return place a link on my site.

Of course you can! I'm really sorry you didnt get a reply - I dont understand why you wouldnt have. :angry:

Please accept my apologies and help yourself to our graphs. Linking to us would obviously be much appreciated. What is your website? Should we link to you in some way?

Share this post


Link to post
Share on other sites
Guest consa

Of course you can! I'm really sorry you didnt get a reply - I dont understand why you wouldnt have. :angry:

Please accept my apologies and help yourself to our graphs. Linking to us would obviously be much appreciated. What is your website? Should we link to you in some way?

I usually refrain from advertising here out of respect to the owners and forum rules, but in the circumstances http://forum.*********************.com, and thanks for the OK.

Apologies to the mods et al ;)

Edited by consa

Share this post


Link to post
Share on other sites

Of course you can! I'm really sorry you didnt get a reply - I dont understand why you wouldnt have. :angry:

Please accept my apologies and help yourself to our graphs. Linking to us would obviously be much appreciated. What is your website? Should we link to you in some way?

Correct me if i'm wrong consa.

His website is http://www.*********************.com Its a *** site covering how housing markets have changed accross many countries. Its like this site but covering other countries aswell. All very good.

NEVER before have real house prices risen so fast, for so long, in so many countries. Property markets have been frothing from America, Britain and Australia to France, Spain and China. Rising property prices helped to prop up the world economy after the stockmarket bubble burst in 2000. What if the housing boom now turns to bust?

EDITED:

Bah ya beat me to it, i must type to slow.

Edited by theChuz

Share this post


Link to post
Share on other sites
Guest consa

Correct me if i'm wrong consa.

His website is http://www.*********************.com Its a *** site covering how housing markets have changed accross many country. Its like this site but covering other countries aswell. All very good.

That is correct Chuz, thnx. there is two addresses, I like to think of it as a backup to here and at the same time collating info from around the globe for the bigger picture etc...

Share this post


Link to post
Share on other sites

That is correct Chuz, thnx. there is two addresses, I like to think of it as a backup to here and at the same time collating info from around the globe for the bigger picture etc...

Either way its a bloody good site ;)

EDITED:

and i make no apologies for advertising it :lol:

Edited by theChuz

Share this post


Link to post
Share on other sites

I am in the process of writing a special report for our website on "Selling to Rent In2Perspective".

As the property market hasnt yet crashed if you think it is about to, then Spring 2006 could well turn out to be the best possible time to Sell to Rent.

We are collating information from a variety of sources and would really appreciate your help. Please let me know your thoughts on:

The pros and cons of STR;

Sources of information on STR;

People you would recommend we spoke to.

It would be great to hear from people who have already Sold to Rent or are thinking of doing so? And those who havent and their reasons for not STR.

Thanks in anticipation...I think STR is about to become a hot topic again in the press and we want to make sure UK homeowners have access to the facts. The report will be free and I will let you know when it is finished.

Either post on this thread or contact me. If you want to do so confidentially I shall of course respect that.

Yours,

Nick Booker

nick@in2p.co.uk

07957 390 289

STR'd in 2004 and glad we did so, as we were renting our flat out whilst living abroad. The difficulties of checking if your tenants are actually looking after the place when you are not able to check up can only be imagined.

Share this post


Link to post
Share on other sites

I could help your report. I've heard of loads of STR's who met on an internet forum to exchange ideas. Now they're sorry they did.

The operative word being "now" I presume? The economic cycle doesn't happen in a day. Today's profits can easily turn into tomorrow's losses and those who mourn will one day rejoice.

All speculative bubbles burst and a STR is simply a market timer. I am a STM and can jump back in and have not done so. Instead I went primarily to cash with enough in the markets to cover rent and living expenses.

My experience has been a happy one as I watch house prices drop all around me as my nest egg builds. I rent a house that was worth 350k when my lease began and which is probably work 300k 6 months later. Its almost like having a double income without actually working: investments go up and house prices drop.

STR is the best way to go if you get out at or near the top. The danger is putting it off and thinking you can follow the market down. As you lower your prices to keep up with the crash you still may not be able to sell. You will have to undersell the market to keep ahead of the drops and that is where you lose big time.

Ask any investor whether now is a good time to STR in the UK and they will say yes. I would not do it if the house was home in the real sense of the word unless, of course, rising IR will take the home in any event. The position millions find themselves in with enormous mortgages and increasing IR already on the way whether the B o E like it or not.

Remeber: the economic cycle cannot be beaten. Values always rise and fall--always.

Share this post


Link to post
Share on other sites
Guest consa

PRO's to renting

===========

1) cheaper than an IO motgage on the same property

2) Free's up capital to invest in something more profitable

3) Flexibility

4) No maintenance costs

5) No Buildings Insurance required

6) No risk of losing Equity

7) Interest on Equity covers a lot of the rent

8) Interest rates rising will be a good thing

9) The wife can keep it on divorce without complication

10) If unemployment strikes rent will be paid immediately (DSS)

Con's to renting

==========

1) Can be given notice at leisure

2) Unable to repaint etc... (although some LL's do allow it)

3)

Pro's to owning

===========

1)Can re-furbish etc

2)

CON'S to owning

============

1) Risk of depreciation

2) Costs more

3) Interest is dead money

4) No flexibility

5) Repair costs/maintenance or having to do them

6) Illiquidity

7) Inability to move at will

8)

6)

There is probably some that I have missed

Share this post


Link to post
Share on other sites

Hello Nick

My personnal experience is as follows

Sold my house in North Kent in 2004 for 165k. I took 80k from sale and have put it fairly equally into the the best bank account i could find , premium bonds and the stock market . I have been fairly lucky and that 80k is now worth nearly 100k

My best friend bought a fairly similar house at roughly the same time and sold it this week making approx 7% over the 2 years . My personal belief is that he made most of that gain in the first year . I really think houses are falling in value and the local paper is filled with reduced signs every week.

I am now 40 years old and have had a mortgage since I was 19 . It is very strange my friends and family (and girlfriend) think I am mad but I have never felt happier . I have ZERO debt . None of my peers can say that. I feel very comfortable with this knowledge . I have given up explaining that I think houses are drcreasing in value as it normally is a very emotive issue

My arguement is my money is gaining in value ."IF" I just put all the money on deposit I could pay almost half my rent with the interest i achieve.

On the positive side I have no house insurance to pay , if the boiler breaks like it did last week or the electric goes wrong I make a call and it gets sorted straight away . I pay nothing . I also have no house maintanance

I made 100% on my house that i owned in 3 years , I think that if this can happen -houses can easely fall by 25% which would mean a saving of approx 40k on my old house value . Or a reduction of approx 50% of the mortgage I used to have . I am more confident know than ever

On the downside I will have moved rented accomadation twice which my girlfriend hates .

Otherwise roll on HPC

By the way to all the other negative posters who answered your post it is in your interest to promote the HPC . Come on guys get your finger out and help out

Share this post


Link to post
Share on other sites

I sold to rent in mid 2004. This was due to divorce and sell up of the matromonial home. I felt that renting for a few years rather than jumping back into the property market made sense given that prices had probably hit their peak. I believe I made the right decision. I have been renting a very nice flat at a rate that is substantially below the amount I would be paying in mortgage interest. This is saving me £500 per month. I have invested my capital partly in an overseas (euro) account a UK treasury fixed account (4.25%) and the rest in stocks and shares. The interest rate on the euro account is only 2.5% but the pound has dropped to it's lowest point against the euro for 8 months. The investment in stocks and shares has gone up over 25%. Meanwhile I reckon that house prices in my areas of interest are back to 2003 levels and down 15-20% against their peak in 2004. Net gain: I haven't worked it out but it likely to be 30% compared to the property market.

By the way congratulations on a great web site.

Share this post


Link to post
Share on other sites

The pros and cons of STR;

Sources of information on STR;

People you would recommend we spoke to.

Yours,

Nick Booker

nick@in2p.co.uk

07957 390 289

The pros and cons of STR; It's a gamble, some will win some will lose.

I did it the old fashion way by breaking a complicated chain.

But I do see and understand why people are doing this for financial gain.

Sources of information on STR; Got me?

People you would recommend we spoke to. Don't talk to; TTRTR, KoN, Brainclamp,

Without a paddle, nodumbsunreader, Monkey, Tony Blair, Gordon Brown.

Talk to Eric Pebble.

Share this post


Link to post
Share on other sites

I am in the process of writing a special report for our website on "Selling to Rent In2Perspective".

As the property market hasnt yet crashed if you think it is about to, then Spring 2006 could well turn out to be the best possible time to Sell to Rent.

We are collating information from a variety of sources and would really appreciate your help. Please let me know your thoughts on:

The pros and cons of STR;

Sources of information on STR;

People you would recommend we spoke to.

It would be great to hear from people who have already Sold to Rent or are thinking of doing so? And those who havent and their reasons for not STR.

Thanks in anticipation...I think STR is about to become a hot topic again in the press and we want to make sure UK homeowners have access to the facts. The report will be free and I will let you know when it is finished.

Either post on this thread or contact me. If you want to do so confidentially I shall of course respect that.

Yours,

Nick Booker

nick@in2p.co.uk

07957 390 289

Parents just put their house on the market, Padstow, Cornwall. Hoping to sell for around £450K (no mortgage) and put this in a bank account and rent.

They should be clearing approx £1500 interest per month (£18K pa) and rent for comfortable place will be no more than £600 - £700. The remainder is more than my dad earns so by selling and renting my dad doesn't need to work! Hopefully prices will go down and they hope to get back into property when they do and basically buy a bigger property or have money left over for other investments

Share this post


Link to post
Share on other sites

STR'd January 04. Needed to move to a larger property for various reasons but as could not find anything suitable and a buyer had offered us full asking price we went in rented. Being in rented also puts us in a good position as chain free for when we do see something we like. Since being in rented seen a few propertys but when sat down and did the calculations we were financially better off in rented!. Yes, its not quite the same as cannot furnish how we want to but it is a bonus have the flexibility of moving when we want to and also not having a large mortgage!.

I am not in a panic to buy, prices round here are silly and most people are taking on huge mortgages to buy! Its just not worth it.!

Lou

Share this post


Link to post
Share on other sites

I am a waiting FTB rather than a STR but I think the principals involved are the same.

Quite simply I can comfortably afford to rent my house, but even with a deposit of 10% of the current value saved, I am a long way short of being able to buy it.

If I2P wants I will PM more details to prove this.

The way I view it is that I can not say for certain whether prices will crash or not (although I am strongly of the opinion that they will). I am reasonably certain there will be no more big gains so:

1. If prices crash I win a very large amount (20% drop = perhaps £30,000 although I expect larger falls)

2. If prices don't crash I loose a small amount (maybe 3% £5,000)

So by staying out of the market I am balancing taking a small risk to avoid a much bigger one.

I may be wrong but if I am it won't ruin my life. The alternative would.

Share this post


Link to post
Share on other sites

STRd in 2004 and have never regretted it.

It's been a happy experience which has freed up money enabling me to invest in things which make better returns than property; I do not suffer from the monovision about houses like the bulls on here. I now rent a super house for half the opportunity cost of owning it and I also have complete freedom if I wish to move without the hassle associated with ownership. As a cash buyer I can also step back into the market anytime I wish.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 337 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%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.