Wednesday, September 24, 2014

UK’s most charismatic landlord is courting foreign investors

'First Chinese, now Americans – they all want my £250m buy-to-let empire in Kent'

Controversial teachers turned landlords Fergus and Judith Wilson say the demand from buyers for their Kent-based buy-to-let empire is rocketing. And most of the potential buyers are from overseas, Mr Wilson said – while interest from UK investors such as pension funds has fallen away. The portfolio consists approximately 900 tenanted houses in and around Ashford, Kent, valued at between £275,000 and £300,000. Following reports that Chinese bidders had emerged in recent days and were "queuing" to buy, Fergus Wilson told the Telegraph that they were "far from" the only parties apparently casting an eye over his vast portfolio of homes.

Posted by quiet guy @ 01:30 AM (5802 views)
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24 thoughts on “UK’s most charismatic landlord is courting foreign investors

  • And still Fergus no-one actually buys it. Why is that exactly?

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  • And still Fergus no-one actually buys it. Why is that exactly?

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  • Hes been trying to flog off his empire for years – No takers. He was trying to flog them off for about 180k to 220k a few tears ago, thats some inflation.

    If it weren’t for his lenders slashing interest payments he would have been bankrupt years ago.

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  • He can’t offload them individually as he would crash the local market by 30% to 40%. Investors know that, so will offer accordingly.
    He has valued his portfolio himself using RightMove asking prices 🙂

    Time’s fast running out for the fat man as UKAR who are clearing Mortgage Express mortgages are pressuring him to pay back £50m of mortgage debt.
    His best option is to sell off a chunk of hit portfolio, but since he won;t get Rightmove asking prices he will devalue the rest of his portfolio. He knows this and is getting these press releases put out as he is phishing for a foreign investor.

    The reason he is looking for a foreign investor is that nobody with local knowledge would pay what he’s asking – much like London property. It’s overprices and only ignorant foreigners will pile in, much like Dubai in 2006.

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  • He may pull it off. There are a lot of foreigners that want to offload large sums of fiat currency on the belief that the system will implode at some stage in the future. There are precedents for confiscating gold, but houses have never been confiscated in the UK.

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  • British Blue, I think the money is chasing yield. You still get a far better yield on buy to let, on average, than a bank account and long term bonds, and so lots of that cash is seeking to be tied up in property instead of low yield bonds. As I’ve pointed out, it is the longer yielding bonds that are falling the most, which is driving more and more cash into 25 year mortgages.

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  • @ libertas – hasn’t money always chased yield? Thus in theory everyone would have always wanted to get into buy-to-let rather than bank accounts and bonds.

    Property gross yield will always be higher that bonds and saving accounts because there are expenses, fees and losses associated with property.

    After all, why go to the expense and bother of property when you can get 4.7% with rate setter and 5.2% with Zopa net before tax.

    The truth is investors gambling on price rises not chasing yield.

    @britishblue Gold was never confiscated until it was. I can see foreign buy-to-let confiscation/taxation much more palatable than confiscating ever was.

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  • Hi Khards, I tend to agree and we may see a nationalisation of part of the housing stock at some stage in the future. I know many people will throw up their hands in horror, but with the loose money policies over the last 6 years anything could be on the cards. There is an interesting programme on USA Watchdog on Monday of this week talking about how the dollar will rise before it crashes. This could well be the same for other reserve currencies like the pound. I am buying gold and using relatives to do the same under the 10k limit. There isn’t a single doubt in my mind that this whole thing is going to blow up, but any house price crash will be purely a part of the process rather than the main player which could be war.

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  • They won’t take housing benefit but sure like to cream off some of it indirectly via the inflated private rents that it causes!

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  • for a maths teacher he wasn’t too clever buying them all in one area

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  • Depends whether he bought them on repayment or interest only.

    Basically, he was on a win-win, betting on prices rising with the high speed train from Ashford to London, which cut journeys to 38 mins from probably well over an hour. If prices are up 40%, say, and he paid off half of the principal over a 12.5yr period, he is certainly quids in, so long as he kept up with maintenance, even if he sells at a discount, though he will suffer quite some capital gains tax, albeit being able to off-set that against maintenance and interest payments potentially.

    Either way, he’ll never have to work again.

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  • Libby, very few are commuting from Ashford on the high speed train as it’s to expensive. Go for a ride on it in commuter hours and you will see that it’s empty.

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  • “Either way, he’ll never have to work again.”

    He is old and not in good health – I doubt he has 5 years of good life left in him, far better he enjoyed his life when he had the chance than wasted it in chasing rent usury. As he gets into physical fights and legal battles I very much doubt this ‘wealth’ has made him happy he looks like a tragic character that should have helped young minds understand mathematics than extolling the virtues of rent seeking which is destroying young lives.

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  • Khards – I use the high speed link on business a couple of times a month and as you say its empty which is fantastic for me ‘on expenses’. Park your car in ample parking next to the station then whisked in to london in no time, always get a seat.

    But since all those renting off Fergus or have a high mortgage cannot afford it so have to suffer the old cramped slow train that takes nearly three times as long. Life is a B*tch when all your surplus income disappears into rent or mortgage repayments but such is Ricardo’s Law of Rent! So rent seeking is responsible for all those lost moments as parents are not thier to put thier children to sleep or give them a smile and hearty breakfast before they set off to school all so our banks and rent seekers like Fergus can become extremely wealthy.

    And cutting taxes will not solve that conundrum, only taxing Land values will solve it.

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  • I have heard many people who commute from Kent complain that SE trains put up all their season ticket prices significantly in the last few years to pay for the new line, which infuriates those who do not benefit from it.

    I didn’t realise that they were struggling to fill the train at rush hour. I guess that’s why. They didn’t get the demand they expected so they had to recoup their investment from their other users.

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  • lib @14 – “taxing land will mean less land developed, less supply”. So what’s the landowner going to do? Leave his plot undeveloped? Then he’s not even cutting off his nose to spite his face (leaving it undeveloped to avoid the tax) because he has to pay the same land tax as the owner of the neighbouring plot, who is developing and using his land efficiently. Your ” less supply” applies instead to the other factors of production – capital and labour – because taxing them instead of land really does reduce their supply. (Let’s assume we’re talking about taxing land instead of, rather than as well as, taxing the other factors of production – I’m not getting into the argument that governments will always try to use land taxes to increase the overall government take).

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  • Back in 2012 I considered commuting to Central London via highspeed train from Dover as we lived a couple of mins walk away form the station. After looking at the train fare £4,500 (from memory), taking the loss of quality of life, higher tax band + losing my profitable spare time DJ’ing I decided it was not worth working in London and commuting.

    I think commuting should be strongly discouraged and property built where it’s needed. Commuting is very unproductive and wasteful in both terms of time and fuel. In fact double train fares and fuel duty should do the trick ;¬

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  • khards – London for me is a working life of madness and I purposely stay away from it unless my hand is forced. Fire-fighters, Health Workers and Teachers travelling 2.5hrs to get to work and then the same on the return journey because of high house prices ! There is something seriously wrong with society when it has reached this predicament.

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  • Back to Fergie and Judith. Strange pair. They have a history of entering slow, no-hoper horses in top British races (annoying jockeys, who hate slow horses blocking them off when they want to quicken or get a good position). Fergus was fined for using a mobile while driving and claimed he was wasn’t using a mobile at all but was singing into a drinks can that he held against the side of his head, making ‘the dog ate my homework’ seem very believable. Another time they tried to get £3,000 for a new bathroom suite from a tenant who cracked a cistern lid. The tenant offered to replace it but they sued for the £3,000 anyway and the judge practically laughed them out of court. They tried to sue a gas engineer for £5,000 for making one of their properties unrentable when he put an ‘at-risk’ notice on a flue there. They lost and were very slow to pay costs. No wonder they want to retire. Being landlords must really take it out of them.

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  • Khards, the cost of commuting already discourages commuting! We don’t need more intervention to achieve that!

    Allowing offices to turn into flats under permitted development rights could shift offices out of London to the provinces where office are super cheap. That is a process currently underway due to relaxation of planning

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  • Spot on Khards – communituing is hugly wasteful and only benefits London land values at the cost of the environment and peoples lives

    I do not have the figures to hand but high London house prices are supported by a huge disparity in public spending on public infrastructure in london. Again confirming Ricardo’s law and subsidising commuting. Of course everybody should pay for what they take in this world which is only fair:

    1. We should pay the ‘externalities’ of what we use in taxation such as the problems caused by travel and the environmental costs
    2. as the unimproved value of land is created by the effort of people around it so it should be returned to those that helped create it

    The added benefit of course is that better use would be made of land in london, making it less likely people needed to commute.

    Both such taxes offsetting taxes on the things we do create by our labour and trade

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  • If you tax labour and capital rather than land values/rents the total tax, rates etc. bill for businesses operating away from large cities is not sufficiently lower than the bill for businesses operating in such cities to create decentralisation incentives; businesses will gravitate to big cities to acquire the advantages of large markets, labour supply and other ‘agglomeration’ benefits. Single-tax LVT, on the other hand, could encourage decentralisation by balancing the costs and benefits of location (total tax bill much higher for businesses in big cities) such that big cities don’t have the benefit/cost advantages over smaller towns that they currently have. After all, people go to big cities not because they want to live there but because that’s where the jobs are.

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  • Bear Neccessities says:

    He is running out of time full stop. Lard does not make for a good blood substitute.

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