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Buy To Let Problems In Manchester

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Todays man evenening news

PROPERTY investors are beginning to pull out of Manchester's booming city centre apartment market.

Wild rumours

Some wild rumours abound. In one case it is alleged that investors planning to purchase an entire block of as many as 100 apartments pulled out of the deal, preferring to walk away from thousands of pounds of deposits rather than buy apartments they now don't want.

"Investors can't make the rental income stack up sufficiently to justify their purchase prices

Another consequence of lower investment buying is that there could be an over-supply of two-bed apartments - always the favourite purchase of the buy-to-let investor.

http://www.manchestereveningnews.co.uk/bus...lling_flat.html

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Knight Frank advise on many of the larger newly-built apartment schemes. John Broadbent, head of their Manchester residential property team, says there's no reason to panic. Even so, he admits the market's changing fast.
If the market is changing fast (and they are not talking about rising prices), this sounds like a very good reason to panic.

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If the market is changing fast (and they are not talking about rising prices), this sounds like a very good reason to panic.

In the world of investment if people tell you dont panic you should panic big time !

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If the market is changing fast (and they are not talking about rising prices), this sounds like a very good reason to panic.

they have been a bugger to sell for at least two years - certainly resale has been very difficult. GF's father owns a couple of good quality (seriously) flats he bought a while ago bang in town. He can rent them for about 4.5% yield, but can't get shut of them for a good price (i.e. break even). He's lucky enough, he owes nothing on them, but he's had them up for sale a couple of times and can't shift them so he's just going to hold them [he can afford service charge, council tax, etc. so it's no odds to him]

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theres a terrific self made sign displayed in a little uber flat on a non descript block build over the foundations of an old rubber company in leyland, lancashire. FLAT FOR SALE £120k blah blah. stuck in the window for the best part of the year. no takers.

they were selling off plan 2 yrs ago for 140k-160k.

oh dear.

can someone please help this 'investor' and buy it before it goes down any further..??

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so, even in this hopelessly over-hyped and dangerously over-optimistic property market, there is no demand for these flats, second hand. This much is clear everywhere I go in the UK.

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had it been a young ftb or family id have felt sorry for them, but you know this particular flat has been claimed by the leechest of all local investors hoping to shaft some poor young idiot for a lifetimes worth of free lunches. so you know being the greedy person they are, how much losing will hurt their wallets and most of all - their pride.

thats one more investor not singing the authorised 'prices only ever go up' tune, and wise investors will realise and listen to real stories like this when faced with property porn from gushy vested production companies offering success through insane sentiment and huge debt liability.

when all we wanted were homes and normality.

who wanted this stupid housing boom in the first place ?

-speculators.

why did they want to take what was previously a simple family home ?

-to fleece you of your money.

god rest this boom.

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they have been a bugger to sell for at least two years - certainly resale has been very difficult. GF's father owns a couple of good quality (seriously) flats he bought a while ago bang in town. He can rent them for about 4.5% yield, but can't get shut of them for a good price (i.e. break even). He's lucky enough, he owes nothing on them, but he's had them up for sale a couple of times and can't shift them so he's just going to hold them [he can afford service charge, council tax, etc. so it's no odds to him]

They don't sound like a very good investment though if you don't mind me saying, chickens coming home to roost.

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Todays man evenening news

PROPERTY investors are beginning to pull out of Manchester's booming city centre apartment market.

Wild rumours

Some wild rumours abound. In one case it is alleged that investors planning to purchase an entire block of as many as 100 apartments pulled out of the deal, preferring to walk away from thousands of pounds of deposits rather than buy apartments they now don't want.

"Investors can't make the rental income stack up sufficiently to justify their purchase prices

Another consequence of lower investment buying is that there could be an over-supply of two-bed apartments - always the favourite purchase of the buy-to-let investor.

http://www.manchestereveningnews.co.uk/bus...lling_flat.html

Great news indeed.....who wants to live in a ghetto apartment block anyway....fast forward 5 years time when the lift's knackered and the local junkie's propping up the stairs.....

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In the world of investment if people tell you dont panic you should panic big time !

And if they say 'trust me', 'don't panic' its time to buy some nappies.

The Manchester 'flatocalypse' is happening. Many Hpc'ers could see this happening 2 years ago. Same is happening in Chester IMO, so many empty ghost blocks of shoddy new build flats with more being built to hasten their decline.

Perhaps these blocks can be changed into hotels or something similar.

Bit at odds with the BBC 1 one O clock news very bullish reporting of the nationwide's figures of ever rising house prices. They said that mortgages used to be 2.8 x income, they are now 3.2 x income. Where did they get that figure ?! of course they did not say.

They did say that average house prices were £167K+ so with a 17k deposit, 150k/3.2=£46,875 per annum average wage -WTF ? am i missing something, eg. are they calling an average wage a combined couples wage.

http://news.bbc.co.uk/1/hi/business/5233720.stm

UK house prices 'pick up' in July

http://news.bbc.co.uk/

Bbc news in video link at top of page, it was towards end of prog, most likely repeated at 6pm +10 pm

Edited by Saving For a Space Ship

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They don't sound like a very good investment though if you don't mind me saying, chickens coming home to roost.

Short term no, but he can afford to hold them and needs neither the capital nor the rent from them, so why not hold them till they do go up (it's a risk that they have a long term nosedive in value I know, but a judgement call nonetheless]

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Just out of interest, what would people expect to pay for one of these "luxury" apartments? i know at current prices they are ridiculous but what would you consider a decent price in this current market for a 1 bedroom flat in Manchester City centre? there seem to be quite a few hovering around the £100k mark. Ive been thinking maybe if they come down to £85k they might be worthwhile? what do you think?

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The Manchester 'flatocalypse' is happening. Many Hpc'ers could see this happening 2 years ago. Same is happening in Chester IMO, so many empty ghost blocks of shoddy new build flats with more being built to hasten their decline.

Perhaps these blocks can be changed into hotels or something similar.

6 months empty and the council will use them for its housing list.

;-)

Which will be fab if tenants can pay council prices.

:)

On BBC this morning there was homes under the hammer - all investors I think - but one bought and did it up quick and could have sold making 15-20k for 3-4 weeks work but chose to rent out despite being told its DSS land.

Fools. Money. Soon Parted.

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so, even in this hopelessly over-hyped and dangerously over-optimistic property market, there is no demand for these flats, second hand. This much is clear everywhere I go in the UK.

You obviously never venture into London and the South East.

Here there is plenty of demand for 'these flats.'

To be fair there wasn't ... during 2004 and most of 2005 - but the rate cut last Autumn re-ignited the market and everything is selling easily now.

I was talking to an agent who has started up a new agency near me - he worked for another local agency before. He can't believe what has happened since he opened for business at the beginning of the New Year. He has sold bucket loads.

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Just out of interest, what would people expect to pay for one of these "luxury" apartments? i know at current prices they are ridiculous but what would you consider a decent price in this current market for a 1 bedroom flat in Manchester City centre? there seem to be quite a few hovering around the £100k mark. Ive been thinking maybe if they come down to £85k they might be worthwhile? what do you think?

when the monthly mortgage costs fall below that of the rental, the occupiers might consider it, but I doubt they would ever make for good investments.

By the time a 25 year mortgage was up, they'd probably be scheduled for demolition (ready for the next bubble?) and the occupiers would be unlikely to buy anyway - what with them being wholly unsuitable for families.

You might get students, commitmentphobic young professionals, or social tenants... but I doubt that there'd be much beyond that. Even if we do return to city centre living as cheap oil runs dry, low rise would be more likely than high rise

You obviously never venture into London and the South East.

Here there is plenty of demand for 'these flats.'

To be fair there wasn't ... during 2004 and most of 2005 - but the rate cut last Autumn re-ignited the market and everything is selling easily now.

I was talking to an agent who has started up a new agency near me - he worked for another local agency before. He can't believe what has happened since he opened for business at the beginning of the New Year. He has sold bucket loads.

au contraire, I live and work in London. Many of the ones where I work (Docklands) stand desolate and half-empty. Even more absurdly, the new ones that are going up everywhere are often in the most putrid locations (balcony overlooking the A12 or a horse-glue factory etc)

I'm looking for a new place to rent at the moment - and the competition for tenants in these buildings is very intense. :)

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Great news indeed.....who wants to live in a ghetto apartment block anyway....fast forward 5 years time when the lift's knackered and the local junkie's propping up the stairs.....

The "ghetto" apartment tag is a good analogy. Around Bromley/Beckenham they've been building apartment boxes on every piece of land going. This is the progression;

1. Land acquired by developers and apartment built

2. Apartments bought off plan and in open market by BTL 'investors'

3. To Let spring up like there's no tomorrow

Sad as it it is, I sometimes look in the car parks of these new apartment blocks - empty mostly. I Look at the intercom systems - few occupied. I look at the electoral register - few registered. Ghost developments showing no profits for inestors

This whole thing is nothing more than a Ponzi scheme relying on a 'greater fool' syndrome. And it'll eclipse what happened in the early 90s, that's for sure :lol::lol::lol::lol:

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The "ghetto" apartment tag is a good analogy. Around Bromley/Beckenham they've been building apartment boxes on every piece of land going. This is the progression;

1. Land acquired by developers and apartment built

2. Apartments bought off plan and in open market by BTL 'investors'

3. To Let spring up like there's no tomorrow

Sad as it it is, I sometimes look in the car parks of these new apartment blocks - empty mostly. I Look at the intercom systems - few occupied. I look at the electoral register - few registered. Ghost developments showing no profits for inestors

This whole thing is nothing more than a Ponzi scheme relying on a 'greater fool' syndrome. And it'll eclipse what happened in the early 90s, that's for sure :lol::lol::lol::lol:

Hi mate, long time no see/speak on here, you're close/to involved in banking/the City, I'm still staggered at how bullish banks are (whether that be through the structured and securitised funding arms, or direct) in relation to BTL, can you explain 'cos I'm mystified? Particularly when I look at the late entries to the market such as mortgages plc today... :huh:

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Hi mate, long time no see/speak on here, you're close/to involved in banking/the City, I'm still staggered at how bullish banks are (whether that be through the structured and securitised funding arms, or direct) in relation to BTL, can you explain 'cos I'm mystified? Particularly when I look at the late entries to the market such as mortgages plc today... :huh:

You may be getting mixed up with someone else as I'm a turf accountant - indeed I know little about high finance/the City.

For what it's worth, I reckon that the lenders, be they blue chip or sub-prime, will carry on lending silly amounts for a while yet, even with falling prices. Being a contrarian, I believe when they really put the brakes on BTL borrowing etc &c, that'll be near the bottom of the market.

Anyway, all this is ignoring the fact that America has a one way ticket into recession starting Q1 next year and they won't be able to reflate the economy by printing paper, sorry $ :lol:

Edited by shermanator

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This is no secret.Everyone with half a brain has been aware of this in manchester for the last few years...thats why the city councils planning dept are deperatley trying to limit the amount of 1 and 2 beds in the cityies boundaries. I think manchester city centre will suffer big time, I imagine leeds and liverpool will too.

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This is no secret.Everyone with half a brain has been aware of this in manchester for the last few years...thats why the city councils planning dept are deperatley trying to limit the amount of 1 and 2 beds in the cityies boundaries. I think manchester city centre will suffer big time, I imagine leeds and liverpool will too.

Are they? There's an immense number still being built - so its a shame they've taken so long to cotton on if thats the case. I imagine they'll love dumping lots of dolites in the city centre where they can be housed on HB in nice flats.

So close to the job centres and temp agencies, where they'll have to get a job or have no cash.

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You obviously never venture into London and the South East.

Here there is plenty of demand for 'these flats.'

To be fair there wasn't ... during 2004 and most of 2005 - but the rate cut last Autumn re-ignited the market and everything is selling easily now.

I was talking to an agent who has started up a new agency near me - he worked for another local agency before. He can't believe what has happened since he opened for business at the beginning of the New Year. He has sold bucket loads.

yeah.. and i was talking to a used car salesman last week - he can't believe how fast his cars are selling. he said that if I don't buy one soon, I won't ever be able to afford my own car!

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You obviously never venture into London and the South East.

Here there is plenty of demand for 'these flats.'

To be fair there wasn't ... during 2004 and most of 2005 - but the rate cut last Autumn re-ignited the market and everything is selling easily now.

I was talking to an agent who has started up a new agency near me - he worked for another local agency before. He can't believe what has happened since he opened for business at the beginning of the New Year. He has sold bucket loads.

Bucket Loads????? look at the transaction volumes for M1, very disappointing no pickup

http://www.home.co.uk/guides/house_prices_...on=m1&all=1

counts_m1_200004_200605.gif

post-552-1154515367_thumb.jpg

Edited by moosetea

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The problem with large cities like Manchester is that there are way too many new builds up for sale at the same time.

I'm sure that there will be landlords that bought in Manchester making decent yeilds but the secret is to buy something exclusive that stays exclusive.

Thousands of similar looking/priced are not exclusive.

Sorry if this does not flow on from previous posts but i'm too busy working to read them all. I mean too busy reading other threads :D

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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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