Bought Off Plan....but Cant Afford It Now!!! Please Help!!!

GDB2222

neverdespairgirl wrote: »

It does indeed, but the OP mentioned a family house, which is why he must protect himself with proper advice ASAP.

I was thinking that, if he did not have the deposit to put down on the flats, he might not have much equity in the family house. His priority perhaps ought to be to keep his brother out of this mess? But I absolutely agree that he needs professional advice.

neas

But what we are missing here... is that the BTL empire guys started life just like this fellow here.

Right? They bought 1 BTL property... then another then another...... should we also help them out because they lost all their property and now will lose their 10 bedroom 'family' house?

Seriously many people are homeless in the world... some not by choice... we can't help everyone. As a Father, a Provider for your family you must make things work.... if the risk is too great for your family then don't do it.. live a normal life... work... pay the bills.. be happy..

When greed comes into it, then things go to tears.

CluelessJock

neas wrote: »

But what we are missing here... is that the BTL empire guys started life just like this fellow here.

Right? They bought 1 BTL property... then another then another...... should we also help them out because they lost all their property and now will lose their 10 bedroom 'family' house?

Seriously many people are homeless in the world... some not by choice... we can't help everyone. As a Father, a Provider for your family you must make things work.... if the risk is too great for your family then don't do it.. live a normal life... work... pay the bills.. be happy..

When greed comes into it, then things go to tears.

Bit catching this idea that it is greed. It happens to be how the Country works, it's known as Capitalism. Without which those that are moaning would be in much worse positions.

If everyone had to follow your example of being normal and working to pay the bills you would find that there would be no one to work for (IE the Entrepreneurs would not have created many of the businesses that employ, because they would be too busy looking for a job to live a normal life) and there would be few bills to pay as many of the suppliers of the goods would not exist for the same reasons.

RabbitMad

Banderman wrote: »

Oh dear. If buying multiple flats that haven't even been built yet isn't gambling then I don't know what it.

A lottery ticket, backing a horse, roulette is gambling.

Buying a property, some shares or opening an icelandic bank account aren't gambling.

What the OP has done (if the op exists and isn't a troll) is set up a business to provide a service without any proper planning. He has agreed to purchase an asset by borrowing money that he believes he can rent out for x, therefore repaying the money he has borrowed and owning the asset outright at some point in the future. His business model has also assumed a % of HPI to make even more cash, however had he done even the most basic of research he'd have found out he was paying over the odds for the asset, the rent was never likely to be as high as X, and even if it currently was there were 100's of other business about to start up doing the same thus providing stiff competition.

When I LTB'd a couple of years back I went through all of these this, and even looked at what would happen if HPI was 0% or even fell. Th OH and I then talked it through and we agreed that the risk was worth it.

As soon as we'd done it we realised that actually being an LL was a lot of hard work and certainly not worth it if HPI wasn't > 0%. Luckily for us, the T gave notice after 8 months and we sold up (Mid 2007) pocketing a nice profit.

Personally I find myself torn between feeling sorry for these people and not caring / hoping they lose everything. The worst bit about this whole BTL selling of plan "scandle" is that the govt will regulate in some knee jerk way making life worse and more costly for the majority of us.

RabbitMad

neas wrote: »

But what we are missing here... is that the BTL empire guys started life just like this fellow here.

Right? They bought 1 BTL property... then another then another...... should we also help them out because they lost all their property and now will lose their 10 bedroom 'family' house?

When greed comes into it, then things go to tears.

But did they? Surely they did their sums and worked out that the business was viable and then went ahead.

Obviously some will have continued relying on HPI, but the more astute will have stopped the mewing once the sums no longer worked.

Where I live in 98 I could have bought a 2 bed terrace for £60 - £65K and rented out for approximately £500 pcm, by 2000 the rent was about £525 but the house price around £90K. The rent in both these examples covered typical repayment mortgages at the time, therefore those BTL landlords in at the start of the boom would have been able to mew for a few years to grow their "empire" before settling at that point and only buying additional properties once they had saved sufficent from their profits.

not all BTL'ers are greedy scum

CluelessJock

RabbitMad wrote: »

The worst bit about this whole BTL selling of plan "scandle" is that the govt will regulate in some knee jerk way making life worse and more costly for the majority of us.

Congratulations on your nice profit.

I think there is a misunderstanding on this forum about buying off plan and BTLs'. It seems most who are critical of Landlords assume all properties bought off plan are then let. It may well be that most properties that were bought off plan and have completed in the last year or so have been let due to the fall in demand, however at the peak this was certainly not the case.
The developers used deposits from purchasers as funding and to leaverage borrowings, the purchasers were able to sell on making a profit from the HPI. To most letting was never a consideration.

RabbitMad

I see where you coming from there.

I would say buying off plan with the sole intention of selling on once it was completed for a profit is still a business though. Is it any different from a trader putting in a pre order for next Harry potter book with the intention of selling each for a profit?

People doing this should have been looking at all the possible outcomes to make sure they were happy with the risk.

I,_Brian

Sad to see the OP's situation, and also the level of vindictiveness posted.

Here's hoping that it gets sorted out - at the end of the day, there's nothing to cheer about when little people get scammed.

2c.

Richard_Webster

I have to admit to not reading all of the many posts on this thread, so somebody may have said this already.

If it was bought off plan then I think the solicitor would have been negligent in not advising OP of the risks of exchanging contracts with no certain mortgage offer in place. He should have been told that market conditions could change and lenders' attitudes could change in the period up to the practical completion of the flat.

KennyVader

A building near my work in East London that has taken over two years to build, completion January - June or so next year depending on which floor that flat is on, and which had large signs outside saying "all sold out off plan" for most of the construction time all of a sudden has a show flat and a large raft of the properties scattered throughout the building up on the Foxtons website, being sold on behalf of the developer. And I think the "all sold out" claim was originally true because I looked into buying in this building for myself two years ago and there was nothing available.

Don't know whether that is the result of one single buyer of lots of flats pulling out or failing, or the developer releasing a series of buyers from their contracts. But if you look on other local property websites there are an absolute tonne of other near-completion flats in the same building up for sale. Presumably individual sellers who either can't afford the place now, can't get a mortgage on them, or who never intended to complete at all (planned to sell just before). Thing is that the prices that they're asking are insane. The plans on the Foxtons website show all the flats to be tiny, and the area is horrible. Lots of people being burnt on this development I think.