House prices fell 1.20% in June

mystic_trev

I'm pretty certain that the mortgage tax relief that BTL's get will be closed in the next Budget. This will have a huge effect on the whole Housing market as Landlords rely on being able to offset this expense.

zar

Sapphire wrote:

I've been reading these (often very useful - thank you) threads for a while now.

It strikes me that a lot of people these days have much higher expectations than their parents did. The parents often started off renting with no particular drive to buy - and certainly not flats with en suite bathrooms to every room and other supposedly 'luxury' amenities. They would usually only think about buying a place when they were starting a family, and then only if they could afford it. There wasn't any kind of stigma attached to renting a place, even if they had families. There wasn't this desperation to buy. When they did get a place, they would take time to set themselves up, and not rush around trying to get the latest products and wrecking the place they bought by ghastly 'modernisation'. (It seems to me, incidentally, that a lot of period properties are being destroyed in the process, just as they were in the 1960s - little seems to be being said about this in the media, of course.)

Whilst a lot of people are desperate to buy as you say, I think many (including me) are more concerned with tenure (I think that's what its called - seen it referred to as this before anyway) than with "investing in property". In the past a lot of people rented off the council, or going further back maybe the lord of the manor or at least a professional landlord. You were renting, but you could live in the house maybe 20 years, you decorated when you wanted, you weren't faced with restrictions on decor or putting pictures up or pets or having to move because your BTL landlord decides to sell just when your kids are in the middle of school with no other properties available to rent in the area. There is a place for ASTs, especially if you are young and want the flexibility to move around the country for work (as I have) but if we can't all own our own home at least give us the chance to have a normal family life in one we don't own. I think some more legislation/tax disincentives would be needed to make this happen.

BobProperty

ftbworried wrote:

Although you've quoted me at the top of that post and then addressed your comments with 'you', I take it that you aren't actually attributing that comment to me since nowhere have I written that. I HAVE a house in an area I can afford to live in- my mortgage is very affordable on our joint income, if it wasn't I wouldn't live here. I have never whinged about 'not being able to afford a house'.

On the renting thing, the house that I bought was actually tenanted when we bought it, at the princely rent of £700 a month (unfurnished). Now, why on earth would I shell out that kind of money to pay someone elses mortgage when the mortgage to BUY the place is not that much more? The BTL who have taken out big mortgages to buy their investments need big rents to cover their big monthly mortgage payments hence not only are house prices being driven up, so are rent prices.

It's not an affordable time to buy OR take on a let at the moment for young people! I know a couple who'd taken out a let a few years ago and their contract stated that their rent would only increase in line with inflation- they have an unbelievably low rent since it has been kept at a level in line with house prices/mortgage payments from a number of years ago. If you are taking out a let now, it is often quite a different story (not to even mention the increase in rent prices because of the increase in demand for rented since house buying is beyond so many's pockets).

Can I just apologise to you, ftbworried, the "you" was meant as a general one, and I agree you personally didn't say that. Unfortunately I come across a lot of people that do have this attitude. You, ftbworried, have done well to find a place at a reasonable price that is affordable to you and in an area you are happy with. There are lots of areas, especially it would appear in the south east where it is cheaper to rent than buy. (Someone who occasionally comes on here but I know from another forum, I think, pays £800 pcm rent for a house that is worth £300k. A repayment mortgage for the whole amount would cost over twice the rent. The return for the landlord is 3.2% gross)
Rents haven't gone up anything like property prices. I spotted a house in a street where I used to own a house, that had sold at auction recently. It sold for over 10 times what I sold mine for. But I doubt if the rent now is even 2.5 times what I was getting. There will be lots of locations where there are a surplus of property for rent where all the recent BTLers have bought into new developments on the promise of £x00 pcm rent only to find that on completion there's 20 identical flats up for rent and no-one wants them or is prepared to pay anything like what they thought they'd get in rent.
I sorry if I sounded a bit harsh but it's always hard to buy your first property. How many FTB's of the last 5 years would have qualified for a mortgage if they'd had to save a deposit for at least 2 years with a Bank or Building Society, or if 100% mortgages were only available on new developments being purchased by graduate couples in permanant jobs in the established professions?

zar

We rent in the countryside because firstly and most importantly we like living in the countryside (my other half has never lived in a city) but also because you get more house for your money when you are renting, as most renters like to rent close to where they work or with good transport links. At £600 a month we are renting a house that I think would sell for £275k (that's probably conservative). I am in the SE but I think this is true over the whole country - in yorkshire we payed £400 rather than £600 by renting in the villages rather than in York. In the towns rents and mortgage payments are much more similar for similar property. This which works well for us as renters but also means if we ever want to buy we'd have to move into a large town or city and give up our rural lifestyle. Whether we will or not is something me and my DH discuss without coming to any conclusions!

BobProperty

realwildone wrote:

We are all brainwashed into beleiving we are richer by this government. House prices will bring this government down. You do have a right to own your house, people do not have a right to own two. I think we will see in the next few years many new laws against people that own two houses including BTL. By the time the laws come out it will be too late to sell.

Look at the new laws already out and forthcoming

Multipal occupancy laws - 6th July 2006

Rental deposits - April 2007
This is my favorite. Landlords drool over your deposit, use it to fund their next house prurchases etc. From April you HAVE to pay the deposit to a new government body - who decide the outcome of the return.

HIPS - April 2007

Council tax laws afoot for second home owners.

and I bet theres more to come...much more. The government never lose an income opportunity and they must know there is a growing band of unhappy young people, who rely on a growing band of unhappy old people to help them buy their homes.

1. If I have a right to own a home can I have this one http://www.frankwyles.com/property_detail.asp?PropertyID=2215
2. This government will be brought down because of an economic downturn of which a house price fall will be one element.
3. I can't see too many laws against people owning more than one house being brought in, that's about as likely as MPs switching their pensions into money purchase schemes.
4. Rental deposits - yes wow, I always rushed off with a months rent to put down as the deposit on my next BTL. Where do people get these ideas from?
5. HIPs - any regular knows I think they are 99% a waste of time but what have they to do with owning more than one house? Maybe you've stumbled on a brilliant idea, no HIPs on your PPR
6. Council tax on second homes - I'm sure it will give Justin Farquar-Ponsonby-StockBroker something to complain about at dinner parties but I don't think it will make him sell his holiday cottage in Cornwall because he now pays more council tax on it.
7. Tenants are an overprotected species in many repects and under protected in others, we don't have the right balance. There are some well dangerous HMOs no doubt but equally there are perfectly acceptable ones. If the government make it cost more to keep them then the landlords will try to put the rents up to cover the costs. If it's not worth keeping them, they will be converted back to houses or into flats. That's the market, that's what happens.

BobProperty

mystic_trev wrote:

I'm pretty certain that the mortgage tax relief that BTL's get will be closed in the next Budget. This will have a huge effect on the whole Housing market as Landlords rely on being able to offset this expense.

More work for accountants to come up with a "get-around" then? I think it might be difficult both politically and practically to word it. I can immediately think of one case in which it might not be possible.

realwildone

1. If I have a right to own a home can I have this one http://www.frankwyles.com/property_d...ropertyID=2215
2. This government will be brought down because of an economic downturn of which a house price fall will be one element.
3. I can't see too many laws against people owning more than one house being brought in, that's about as likely as MPs switching their pensions into money purchase schemes.
4. Rental deposits - yes wow, I always rushed off with a months rent to put down as the deposit on my next BTL. Where do people get these ideas from?
5. HIPs - any regular knows I think they are 99% a waste of time but what have they to do with owning more than one house? Maybe you've stumbled on a brilliant idea, no HIPs on your PPR
6. Council tax on second homes - I'm sure it will give Justin Farquar-Ponsonby-StockBroker something to complain about at dinner parties but I don't think it will make him sell his holiday cottage in Cornwall because he now pays more council tax on it.
7. Tenants are an overprotected species in many repects and under protected in others, we don't have the right balance. There are some well dangerous HMOs no doubt but equally there are perfectly acceptable ones. If the government make it cost more to keep them then the landlords will try to put the rents up to cover the costs. If it's not worth keeping them, they will be converted back to houses or into flats. That's the market, that's what happens.

Typical landlords response. No doubt you wrote all your notes in a rent book

WHA

Conrad wrote:

Interesting. I did too. Are we in a minority?

I know some very experienced old timer LLs. Not one of them would buy at todays prices, indeed some like us are selling. mmmmmmmm

I worry for these new amateur B2Ls comming into the market. Certainly those I talk to dont have any idea of comparartive yields / growth.
Thier sole reason for B2L now is "its me pension", no real thought beyond that. If only investing were so simple.:D

I've quite a few long-term landlord clients who have been selling most of their BTL portfolio over the last couple of years.

One had about 40 flats and now has about a handful - he made a massive profit which he is sitting on with the intention of buying again when prices fall. He's been letting for about 20 years and got it right in the early 90s, when again he sold before the crash and re-bought many more a few years later with the same money!

Another owned over half of one particular street and has sold it all, house by house - as one sold, he put another on the market until they all went. His plan was to avoid having to sell too many at a time to depress the price.

I too worry about the amateurs who are going into BTL now. To make money you have to know when the time is right to move against the trend whether it is commodities, currency, stocks & shares or property - that is down to skill. Simply following the trend is far riskier and is simply a matter of luck as to whether you win or lose.

david29dpo

i agree. it can be easy money but common sense is a must. i blame all the tv programs making it look to easy,and greed of course !

nelly_2

Prices dropped cos of the world cup....my !!!!!!.

It's cos of Wimbledon really :rotfl: :rotfl: :rotfl: