Capital Gains tax: buy-to-let investors must tear up retirement plans

chucknorris

Thrugelmir wrote: »

You are truly so funny. :rotfl:



Amazing what effect hindsight has on ones ego.

I hardly call managing a BTL property hard work either. [/QUOTE

Surely the objective in life is to get comfortable WITHOUT hard work? Damn have I got it wrong and should be down a coal mine right now. But honestly it can be hard work at times.

marklv

carolt wrote: »

http://www.telegraph.co.uk/finance/personalfinance/capital-gains-tax/7773029/Capital-Gains-tax-buy-to-let-investors-must-tear-up-retirement-plans.html

Oh diddums, however will they cope.

Forced to own only 1 house each!

And they might have to pay for their pensions themselves, instead of getting me to pay for them.

My heart bleeds for them.

Capital gains tax should have gone up to match income tax rates. Usual Tories, looking after their own! :mad:

Thrugelmir

[QUOTE=chucknorris;34136197
Surely the objective in life is to get comfortable WITHOUT hard work? [/QUOTE]

Some of us do it for fun now!

chucknorris

Thrugelmir wrote: »

Some of us do it for fun now!

ahh but then it isn't really hard work if it's fun now is it?

Gorgeous_George

Managing the BTL isn't difficult but can be time-consuming.

Buying a property in serious need of repair and getting it to a good standard IS most definintely hard work. Sitting on your bottom and doing nothing to improve your lot is dead easy.

GG

chucknorris

Gorgeous_George wrote: »

Managing the BTL isn't difficult but can be time-consuming.

Buying a property in serious need of repair and getting it to a good standard IS most definintely hard work. Sitting on your bottom and doing nothing to improve your lot is dead easy.

GG

Couldn't agree more, last refurb I did my back was in agony for weeks, it was a 3 bed victorian house and we decorated it top to bottom internally and some external painting, laminate floors throught, laid a patio and very large area of turf, various fixtures and fittings fixed as well as organised a new gas boiler, couple of replacement rads and a new kitchen

IveSeenTheLight

Thrugelmir wrote: »

OK a very simplistic view based on averages. Lets say that you borrow a £100k over 25 years at a fixed 5%.

To repay £100k in 300 months requires an average capital repayment of £333 per month.

Here is the start of the flaw in your analysis.
Everybody knows (or I assume they do) that paying off a mortgage is not as simple as taking the capital amount, dividing by the amortization period to get an "average monthly capital repayment amount"

Look at any mortgage and you will see that in the initial years the capital repayment is smaller and in the latter years the repayment part is greater,

I'm sure you also realise that the income stream generated from property over that 300 month period, will not remain the same as in month 1.

You seem intelligent enough but are trying to play the figures such that it seems that it is not a worthwhile investment.

We've been over this before and I am a little reluctant to go over again, but I will go over later the figures again to show the value in investment.

For now, I'm off to take my son to the park. See you later.

JonnyBravo

IveSeenTheLight wrote: »

You seem intelligent enough but are trying to play the figures such that it seems that it is not a worthwhile investment.

We've been over this before and I am a little reluctant to go over again, but I will go over later the figures again to show the value in investment.

Exactly.
Some people are determined to only consider figures where BTL won't or shouldn't work. Fine. I think we all agree there are plenty of examples of this. Probably the majority of the property in the country. So what?
Equally there are figures where it does work. And no doubt these are harder to find now. Do they still exist though? Of course.

I don't think I'll bother trying to convince someone who insists that BTL is no longer viable.
I'll just carry on letting someone else payoff my mortgage and then have a nice bit of extra income for not much work from a business model that doesn't work. Not bad. :cool:

Thrugelmir

IveSeenTheLight wrote: »

You seem intelligent enough but are trying to play the figures such that it seems that it is not a worthwhile investment.

No not at all. My reference to the majority, is not those like Chucky, who have a £100k of capital to invest. But the people sucked in, as ever rising house prices is all they've ever known. Now that Nationwide are upping CTL by 1.5% are saying they are unable to increase their tenants rent to cover the mortgage, for example.

I applaud those who took the opportunity to acquire BTL while the window was open. But the game has moved on. Nothing lasts forever.

nollag2006

Thrugelmir wrote: »

I applaud those who took the opportunity to acquire BTL while the window was open. But the game has moved on. Nothing lasts forever.

There still is plenty of time. I get a smidgen just under 6% gross yield on my current BTLs but that's because I bought them in Spring of last year. A nice little earner.

:beer:

But I am strongly considering going back into the market again, over the quiet Summer months. Even after the high prices of the past year, you can still get a 5% return around Ealing, where I have my BTLs:
http://www.londonpropertywatch.co.uk/average_rental_yield.html


I've not had a bit of hassle from tenants over the years. If you treat folk with respect, they (hopefully) will reciprocate.

The trick is not to view it as a short term speculative investment. Cash flow is likely to be weak in years 1 and 2, and you need to be able to ride out the ups and downs of any movements in the housing market.

I bought mine as a college fund for my two daughters - so hopefully the market should be double or treble current levels in 18 years, while the tenants have paid most of the mortgage off !!

:T