BTL dreams go up in smoke

Gorgeous_George

It's a bloomin' nightmare ain't it?

My BTL cost me £15,500 and is currently worth £80K-ish. My yield was higher when it was worth £40,000 than it is now.

This April I'm having to reduce the rent - from £420 to £450 per month. That's a fall of minus £360 per year.

My BTL lifetime tracker is now at 1.89%. That means I'll have to pay even more tax next year.

It's just all a nightmare. I don't know how I'll cope. Might have to have yet another holiday in the sun to relax and unwind.

GG

mr.broderick

Gorgeous_George wrote: »

It's a bloomin' nightmare ain't it?

My BTL cost me £15,500 and is currently worth £80K-ish. My yield was higher when it was worth £40,000 than it is now.

This April I'm having to reduce the rent - from £420 to £450 per month. That's a fall of minus £360 per year.

My BTL lifetime tracker is now at 1.89%. That means I'll have to pay even more tax next year.

It's just all a nightmare. I don't know how I'll cope. Might have to have yet another holiday in the sun to relax and unwind.

GG

Fair Play GG..

the_ash_and_the_oak

IveSeenTheLight wrote: »

Thrugelmir wrote: »

Only when considering purchasing the property.


Otherwise people with BTL's bought pre 80's would have triple digit returns.
Its not viable to assess this way, hence you assess against the value

Ok that does make sense, thanks

I now see how a drop from 200k to 150k increases the yield. What I don't get is why this increased yield is of any benefit to someone having paid the 200

Spendless

Some people dabbled in BTL's when they should have left well alone. My mate buyng 2 in 2006 asked for my view. I asked the following

what would you do if.......

you struggled to find a tenant

the tenant didn't pay their rent

you went into hospital for a while and ended up on reduced wages (she has a 'for life' health problem)

you lost your job

you needed to sell the property due to any of the above and found yourself in negative equity

'They won't happen' said my mate ALL the above have.:rolleyes:

She's now having 1 house re-possessed and struggling financially.

stevetodd

the_ash_and_the_oak wrote: »

IveSeenTheLight wrote: »

Ok that does make sense, thanks

I now see how a drop from 200k to 150k increases the yield. What I don't get is why this increased yield is of any benefit to someone having paid the 200

It is not a benefit to someone who is in that situation.

the_ash_and_the_oak

ah, yes I realize now (looking back at thread) - I misread the post where this was brought up first - or misread the tenor, more to the point

stevetodd

Spendless wrote: »

Some people dabbled in BTL's when they should have left well alone. My mate buyng 2 in 2006 asked for my view. I asked the following

what would you do if.......

you struggled to find a tenant

the tenant didn't pay their rent

you went into hospital for a while and ended up on reduced wages (she has a 'for life' health problem)

you lost your job

you needed to sell the property due to any of the above and found yourself in negative equity

'They won't happen' said my mate ALL the above have.:rolleyes:

She's now having 1 house re-possessed and struggling financially.

All good questions and highlights the difference between investors who analysed correctly what they were doing and those that just blundered in not really knowing what they were doing. When I started my goal was financial independance through rental inflation, not capital growth (that was back in 1991)

Cleaver

Spendless wrote: »

Some people dabbled in BTL's when they should have left well alone. My mate buyng 2 in 2006 asked for my view. I asked the following

what would you do if.......

you struggled to find a tenant

the tenant didn't pay their rent

you went into hospital for a while and ended up on reduced wages (she has a 'for life' health problem)

you lost your job

you needed to sell the property due to any of the above and found yourself in negative equity

'They won't happen' said my mate ALL the above have.:rolleyes:

She's now having 1 house re-possessed and struggling financially.

I've heard that Paperchase do a nice, new range of 'Told You So' greeting cards if you really want to hammer the point home to them?

alm721

I really don't get this argument. We have 2 buy to let properties accquired after 04 (well one was). Since that time prices have risen a bit then fallen a lot and expect they will fall furthur just like anyone elses who bought around this time buy to let or not. However we have a small mortgage on one property and none on the other. On the one we do have we borrowed extra on our house which is tracking BOE base rate +0.27 and I'm sure it doesn't take too much working out to realise our rent is quite a lot above this so am I worried, not in the slightest. Its not an issue at all unless you have to sell. Which I and many others don't, therefore all this 'buy to letters are idiots' is getting a bit tedious. House prices are irrelevent until you realise the assesst, why do some people just not seem to get that?
I agree that prices had to come down as it was getting ridiculous but we were always aware of this. Why do people assume that buy to let investers are all idiots who've borrowed loads and are now in bad situations. Granted some will as will people who maxed out at the peak on their own houses! but I bet the proportion of landlords in this situation is quite small when compared to number of home owners in general.

Entertainer

Note that Romans is in the regions. 10% yields have not been available across the south, south west and greater London for many years.

All this talk about long term is confusing the issue. What we are talking about is timing- if an investor bought in the mid late 90's he bought a good investment. If he bought since 2003 he didn't.

Incidentally, rents around my way are definitely dropping. There are alot of properties coming onto the rental market from every kind of flat to new build houses.