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Timm

Boom In Btl

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WTF?

http://news.bbc.co.uk/1/hi/business/7264519.stm

The buy-to-let property market is still thriving, according to the Council of Mortgage Lenders (CML).

The number of buy-to-let loans rose by 23% last year, taking their number to 1,038,000 and accounting for 10.3% of all outstanding mortgages.

This lending picked up in the second half of the year at a time when general mortgage lending was starting to fall.

EDIT: Sorry redwing, didn't see you there...

Edited by Timm

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Guest barebear

Yes and the reason why this boom has been so long lived and probably why a crash will be slow and protracted.

BTL .AND tHE FACT THAT YOU DONT NEED TO PROVE INCOME.

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The number of loans (including remortgages) to buy-to-let landlords in the second half of the year was 179,100, up from 171,800 in the first half of the year and 177,200 in the second half of 2006.

Nearly half of the figure is accounted for by remortgages.

http://www.cml.org.uk/cml/media/press/1514

edit:add link to CML data

Edited by Matt Bear

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Haha, that's great! Let them keep borrowing more and more!

My rent is already less than half the cost of the mortgage. If there are more lettings due to pile into the market, there will be over supply and the rental prices will stay low. If they want to subsidise my shelter costs, then that's fine by me.

Of course, as the BTL dream starts to really hit the skids and more and more BTL properties don't have tenants, the more properties will be up for sale. As has been stated by many a bull, supply and demand dictate prices and massive over supply will hammer the prices.

The ironic thing is, the BTLers will be competing for sales on the way down, just as they did for purchases on the way up. If for one, will feel little sympathy for them.

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This just makes no sense.

It's in total contradiction to every other report about BTL mortgages being pulled, sentiment shifting, etc

What's going on?

Just a theory here, nothing to substantiate it;

The article suggests that a lot of the 27% increase happened in the 2nd half of the year. Maybe, as FTB demand dried up with the increases in IRs, the BTL brigade steamed in further. After all, if you're of the mindset that it's a good business model why wouldn't you gorge yourself if there's less competition for the properties?

I remember a friend who is a part-time morgage broker telling me in September that he could still get good BTL deals but not owner-occupier deals.

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i think there are around 800,000 btls. + probably a few thousand more off the record ones.

thats getting on for 1 million other peoples local homes, which have been bought up by these parasitic barstewards.

perhaps 20% are in trouble ?

id like to see 90%.

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Guest barebear
Haha, that's great! Let them keep borrowing more and more!

My rent is already less than half the cost of the mortgage. If there are more lettings due to pile into the market, there will be over supply and the rental prices will stay low. If they want to subsidise my shelter costs, then that's fine by me.

Of course, as the BTL dream starts to really hit the skids and more and more BTL properties don't have tenants, the more properties will be up for sale. As has been stated by many a bull, supply and demand dictate prices and massive over supply will hammer the prices.

The ironic thing is, the BTLers will be competing for sales on the way down, just as they did for purchases on the way up. If for one, will feel little sympathy for them.

Half the cost of the mortgage ?? How do you know what mortgage if any your landlord's got ?

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This is, yet again, a sickening piece of 'journalism' from the Brown Broadcasting Corp - and how much longer can these donuts carry on banging the drum about so called investment without being regulated in the same way as for stock, shares or any other, more traditional investment class? All been said on HPC before of course but this one is a particular shocking example IMO.

Took a look at Chester rentals on RM this morning - shed loads of places to rent so where this shortage of supply comes from, it certainly ain't round here...

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This is, yet again, a sickening piece of 'journalism' from the Brown Broadcasting Corp - and how much longer can these donuts carry on banging the drum about so called investment without being regulated in the same way as for stock, shares or any other, more traditional investment class? All been said on HPC before of course but this one is a particular shocking example IMO.

Took a look at Chester rentals on RM this morning - shed loads of places to rent so where this shortage of supply comes from, it certainly ain't round here...

dont pay your licence fee in protest then.

stop whining and do something.

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perhaps 20% are in trouble ?id like to see 90%.

Just think ........."new build apartment blocks " :lol: .........then the contagion spreads ...............

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WTF?

http://news.bbc.co.uk/1/hi/business/7264519.stm

EDIT: Sorry redwing, didn't see you there...

Slightly surprising but a number of desperate FTB were taking out BTL mortgages as opposed to normal mortgages on the basis that the underwritting is less demanding. Further if the break is on the BTL bandwagon then this will start to appear in the figures in the first half of 2008

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Slightly surprising but a number of desperate FTB were taking out BTL mortgages as opposed to normal mortgages on the basis that the underwritting is less demanding. Further if the break is on the BTL bandwagon then this will start to appear in the figures in the first half of 2008

Also, how many of these investment mortgages are because BTLers can no longer get access to a cheaper resi mortgage by telling a little white lie?

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i think there are around 800,000 btls. + probably a few thousand more off the record ones.

thats getting on for 1 million other peoples local homes, which have been bought up by these parasitic barstewards.

perhaps 20% are in trouble ?

id like to see 90%.

I'd agree that they're mostly parasites. Trouble is, all the aspirational FTBs are renting those homes. So what happens to those FTBs if a large number of BTLs go to the wall? Yet another eviction notice, aarggh!

I wonder if the banks will let tenants stay put while they recoup their costs?

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Half the cost of the mortgage ?? How do you know what mortgage if any your landlord's got ?

To clarify, less than half the mortgage I would have to pay for if I'd bought the house when I moved in. The figures (it's a new build, so it makes it simple):

Rent: £440 pm

Avg. FTB Mortgage: £1000+?

House price: £195k*

*This dropped to £175k for the rest of the development of 30+ houses on the estate recently. NI prices are dropping off sharply already...

My landlord said he was in it for the long term investment and recently admitted the prices are a bit high at the mo, but are running about "2 years ahead of what they should be" and alluded to the market levelling off for a bit. I hope it works out for him and his mortgage isn't as high as mine would be. He is a nice guy and a good landlord, but the reality is, it would cost me over double each month to live within the same place and I have no stamp duty/fees to worry about. I'd rather buy a house than rent at some point, but not while it's so much cheaper to not bother.

With the prices over here in NI tanking pretty spectacularly (a recent university study shows 20% off in 3 months!), even affecting my estate, I'm pretty happy I didn't buy.

Edited by Traktion

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This just makes no sense.

It's in total contradiction to every other report about BTL mortgages being pulled, sentiment shifting, etc

What's going on?

I don't really see anything untoward or contrarian in the article to be honest.

It states:

The number of buy-to-let loans rose by 23% last year

..and talks about how 2007 saw more BTLers than ever before enter the market.

We knew this. Think back to October/November... we knew this was the case and it's only relatively recently that Banks and BSs have reduced the BTL offerings available.

This is a fantastic state of affairs for bears! Lots of new entrants, many of whom most likely didn't their sums very well, buying just before the peak in prices. Great! As prices begin their long fall these "investors" will be squeezed. Some will panic and sell, helping the market down. Some will hold on until they're repossessed. It's quite difficult (and arguably wrong) to be "glad" that this will happen to people... But if you look at the end game, it's what the country needs.

Incidentally, such huge numbers investing in 2007 will only help make the 2008 numbers look even worse. By July this year the stats on prices, volumes, BTL, repossessions, etc. will be shocking.

Edited by Bobsta

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Okay, on reflection I can buy this.

Total number of BTL mortgages (including remortgages) increases from year ending 31/12/06 to year ending 31/12/07.

Meaning:

1. Number of BTL purchases increases

OR

2. Number of remortgages increases (anyone seen a breakdown of the figures? This would naturally happen in a market which has grown steadily for several years)

OR

3. Higher proportion of BTL properties are bought with BTL mortgage (as opposed to residential mortgage)

The media reports assume that number 1 is the only relevant factor. I doubt that it is.

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Okay, on reflection I can buy this.

Total number of BTL mortgages (including remortgages) increases from year ending 31/12/06 to year ending 31/12/07.

Meaning:

1. Number of BTL purchases increases

Yes from about 800,000 to just over 1 million.

OR

2. Number of remortgages increases (anyone seen a breakdown of the figures? This would naturally happen in a market which has grown steadily for several years)

Nearly half of BTL lending for the past 6 months was remortgaging

http://www.cml.org.uk/cml/media/press/1514

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There still seems to be a widespread sentiment that while we might be seeing a 'correction' in property prices, the upward trend will resume. A lot of people still see a collapse in house prices as imposible, despite the fact it's happened before within the last 20 years and is occurring right now in the USA.

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There still seems to be a widespread sentiment that while we might be seeing a 'correction' in property prices, the upward trend will resume. A lot of people still see a collapse in house prices as imposible, despite the fact it's happened before within the last 20 years and is occurring right now in the USA.

Once the YOY stats go negative opinions will change. People are very fickle.

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  • 293 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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