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Red-Squirrel wrote: »I suppose it depends on whether you just look at the costs on the day of purchase/move in.
If I still had the flat, say I was paying £230 now, and I'd have over 70k in equity.
The person next door would be paying £750 to live in the exact same space in the exact same location, without the equity or the security. Even if you take into account the service charge and ground rent I'd still be paying, my monthly cost to live there (before bills) is in fact less than half.
If the landlord who owned next door bought it at the same time and price I did, especially if they bought with cash, they'd be laughing all the way to the bank!
Are they though, that is the question, how do you know they don`t stay for a month or two then jump into a 500 p.m flat?0 -
Mmm. From a quick quiz through, I'm not sure where you're getting those figures. Perhaps you could clarify?
Thank-you for taking the time to read through the report and the annexes, makes for a much better discussion. :beer:
I'm afraid that I left the spreadsheet with my workings out on my office PC. From the top of my head I discounted social sector units (which wouldn't be available to either OO or Landlords) and worked out ratios of ownership on the remainder. If I still have the workings out I'll share them tomorrow.0 -
https://www.property118.com/buy-sell-hold-get-altogether/99898/
One solution is to start "Caning the rents" apparently. I might even start a thread on this at some point
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I do think there are people for whom renting is a better option, but I don't think private landlords should be the ones to benefit
This very much sums up the attitude about LL on this forum. It assumes that all LLs have bought a second property for the sole purpose of earning additional income. It also assumes that all LLs are greedy and will want to make as much profit as possible at the detriment of the customer. It assumes that LLs make a nice profit each month, which they spend laughing at its poor tenant who has no choice but to accept all the conditions.
It forgets that a large number of tenants have become so through changes in situations rather than them looking to become so. It forgets that many LL will not make £1 profit once all costs/tax/mortgage is taken into account, and for some, it will even cost them each month. It forgets that for a number of LL, the only benefit of being a LL is the investment in equity that will serve as a pension for their future, ie. save the tax payers later in life.
So is it so bad that a LL could 'benefit' when it suits the tenant, a tenant who might very well one day become a LL themselves one day?0 -
There is no other reason to undertake ANY business activity.It assumes that all LLs have bought a second property for the sole purpose of earning additional income.
It's a very poor business which isn't run with the intent of making a profit, no matter what the business does.It assumes that LLs make a nice profit each month
Then those landlords should be looking at how to improve their business, or get out of it.It forgets that many LL will not make £1 profit once all costs/tax/mortgage is taken into account, and for some, it will even cost them each month.
Then those people are fools, because they are making a very unpredictable investment decision, wrapped in a very poor tax situation compared to proper pension investments. They are either buying in to that investment at the wrong time in the cycle, or failing to take their profit at an ideal time.It forgets that for a number of LL, the only benefit of being a LL is the investment in equity that will serve as a pension for their future, ie. save the tax payers later in life.
Long-term capital gain is a side benefit from a residential lettings business. It should never be the long-term aim, especially when short-term income is lacking - or even negative.
But you'll notice I snipped swathes of your text. That was deliberate - because you are making one huge leap of logic. Profit and sensible business management are NOT incompatible with providing a good environment for your tenants. Quite the opposite... Happy tenants are good, long-term tenants. A good property to live in is one that gives low maintenance costs and few voids.0 -
They sound very unusual figures. Can you give any examples?
£430 mortgage for a 90% LTV would be around £105k purchase price.
Or are you meaning interest only mortgage payments? If so, that may allow you around £230k purchase price, but those loans are very hard to obtain these days without having some kind of other repayment vehicle in place. What were you thinking of, and how much monthly allowance are you making?
And what about when interest rates rise, as they will inevitably do?
Well that is the figure I am looking at for a monthly payment. I have saved since I was a teenager for a 30k deposit and I can only JUST afford the cheapest properties in my area. 1 bed properties here start at 150k - 160k. Not an interest only mortgage.0 -
Like I said - best rate for a 90% mortgage is 2.49%. If you're looking at a lower LtV, you may get a better rate. If you're looking at just an intro discount, then you may get a better rate, but that WILL end before you've blinked, so is very unwise to budget on... That was based on 25yrs - a longer term may give you a slightly lower payment, but a much higher total cost.Well that is the figure I am looking at for a monthly payment. I have saved since I was a teenager for a 30k deposit and I can only JUST afford the cheapest properties in my area. 1 bed properties here start at 150k - 160k. Not an interest only mortgage.
What rates/products/term are you looking at?
At £150k with a £120k mortgage, you'd be looking at 80% LTV - assuming you have other money for fees etc. That gets you 1.75% from Coventry BS, from the mortgage best buy page here.
Good luck!0 -
fairy_lights wrote: »OP hasn't come back to add anything further to the discussion so I suspect his intention was to try and stir up an argument.
sorry for not being glued to this thread you muppet0 -
I think there needs to be regulation, yes. I'm not saying there shouldn't be rental properties of all kinds, of course there should be, but I also think there needs to be more fairness in the housing market, which there currently isn't.
Yes, you are right. I mean BTL, rather than cash buyer. I apologise, it has been a long day!
Perhaps where you live, maybe. Where I live rental payments are nearly a double a mortgage payment and that's before you add bills. For example, on a 1 bed property where I am my monthly mortgage would be approx £430, an identical house is (looking on Rightmove right now) the very cheapest I can find is £720pcm without bills and it's not in the best condition. A house share alone will set you back £500.
I just think the system needs to be fairer. I'm not sure exactly how it may be done, but the bottom of the market is absolutely strangled. Maybe X % of starter homes can be rentals (to make sure that people who want to rent have their needs met), then another x% of houses for sale have FTB as priority (as long as FTB is offering at or above asking price). Again, I don't know exactly the way to make it work, but I think you'll struggle to find anyone currently in the situation who will tell you the system is fair or isn't entirely skewed towards BTL.
ok...
1: some people don't want to live in your little rabbit hutch starter homes. So I think you've already made a presumption that FTB will only buy those / people will choose to rent those.
2: Life isn't fair, whoever told you otherwise was lying to you.
3. I don't want a fair system. I want a competitive one, where people who actually work hard and succeed are rewarded. I disagree wholeheartedly with rewarding failure.0 -
Yes, yes it is, but that's a big subject for another day. Suffice to say that 80% of 1 bed flats and 50% of 2 bed flats are owned by landlords who for a variety of reasons can outbid FtB's (at least until recently).
But I think this thread - AST Eviction due to pregnancy - is a perfect example of why landlords get (and deserve) so much grief. Complete ignorance of the law on the part of the landlord leading to an illegal attempt at eviction, and no doubt accompanied by an attitude that they're doing the world a favour by providing housing.
In over a decade of renting I've met plenty of those types of landlords - amateurs who think that tenants should be grateful for what little they do - and the decent ones have been few and far between.
80% of 1beds and 50% of 2 beds are owned by landlords?
...and 100% of that information is fabricated......0
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