UK Rents "highest in Europe"-- due to mortgage rationing

carolt

Much easier to buy a BTL - you can buy in any area, not tied to things like it being somewhere you personally might want to live in.

Then you can decorate it cheaply and nastily, in a manner that you'd never do if you had to live in it yourself.

Easy money. But - astonishing as I'm sure you find it - there are people who actually put morals before cash.

I daresay having principles and living by them is entirely alien to you, unless you count Hamish's sole principle of 'I'm alright Jack', of course.

It's part of the sane package that means I work as a teacher, for example - of course I could get more money doing something else, but money isn't my driving force.

Can you imagine that, Jonny?

People who actually aren't motivated by money alone in every waking moment.

What an excitingly novel concept.

JonnyBravo

carolt wrote: »

Much easier to buy a BTL - you can buy in any area, not tied to things like it being somewhere you personally might want to live in.

Then you can decorate it cheaply and nastily, in a manner that you'd never do if you had to live in it yourself.

Yep true. Hadn't considered geographical considerations. Unfortunately I spent much more decorating my rental property than would be wise, but seeing as I lived in it for 6 years its a "mistake" only with hindsight.

carolt wrote: »

Easy money. But - astonishing as I'm sure you find it - there are people who actually put morals before cash.

I daresay having principles and living by them is entirely alien to you, unless you count Hamish's sole principle of 'I'm alright Jack', of course.

I guess we'll continue to disagree on this. I think most of the popluation would agree with me that renting out a house isn't really immoral.

carolt wrote: »

It's part of the sane package that means I work as a teacher, for example - of course I could get more money doing something else, but money isn't my driving force.

Can you imagine that, Jonny?

People who actually aren't motivated by money alone in every waking moment.

What an excitingly novel concept.

Hmm.... not sure what you're driving at here. I'd imagine I could get paid more too. Don't really know cos I haven't looked, cos I'm happy where I am.
You're the one complaining at how expensive houses are and how you don't want to spend too much. Perhaps you are more worried about money and not having enough rather than me?

carolt

Of course I am. But not enough to sell my soul, so to speak, no.

JonnyBravo

Is that what I've done by renting out a house for 5 years? Sell my soul?

Really2

carolt wrote: »

Of course I am. But not enough to sell my soul, so to speak, no.

Out of interest carol, you have been on here longer than me and seen price fall and rise again.

What deposit do you have and how much do you need/want houses to fall by before you buy?

I know you only want to work part time etc. But I believe between you and your partner you earn over £50K so I was just wondering to what point are you holding yourself back from purchasing. (for example do you need/want them to fall buy another 20%+ etc?)

Edit, this is not a jib at you I am really interested to know as we have seen many "bears" buy on here now.

silvercar

carolt wrote: »

I could have easily bought into BTL at any point in the last decade and a half, but wouldn't as I despise parasites like you.

It is actually very difficult to get a BTL mortgage without being a owner occupier. Even in the easy mortgage times a few years ago, BTL mortgages for tenants were difficult to find.

JonnyBravo

silvercar wrote: »

It is actually very difficult to get a BTL mortgage without being a owner occupier. Even in the easy mortgage times a few years ago, BTL mortgages for tenants were difficult to find.

Didn't realise that. What's the rationale there? Surely the numbers work or don't?
I s'pose it's worries about losing your home and having to rent somewhere more expensive and then not being able to afford the BTL?
Surely that wouldn't matter if the BTL was self sufficient anyhow?

silvercar

JonnyBravo wrote: »

Didn't realise that. What's the rationale there? Surely the numbers work or don't?
I s'pose it's worries about losing your home and having to rent somewhere more expensive and then not being able to afford the BTL?
Surely that wouldn't matter if the BTL was self sufficient anyhow?

Its all about security for the lender and confidence that the potential landlord knows what they are doing, after all this is a business.

More risks with a tenanted property, more things to go wrong; landlord not being notified of a building problem, delays in getting a problem tenant out, times when the property is empty. If it all falls apart and there is a delay in the property being sold (either because it has been trashed or a delay in an eviction) the arrears on a mortgage can still mount up. However sound the plan, an unexpected void can cause cash flow problems and then lack of attention to maintenance. Safer for the lender to know there is another property they can look to for equity via a charging order.

If you own your own home there is a confidence that you know about maintaining a home, for a tenant they don't have (and may never have had) the responsibility of looking after the fabric of the building.

Search around the mortgage board on this forum, there are a few posts of people not being able to get BTL mortgages just because they don't own their own place, even if they have a large deposit.

chucky

JonnyBravo wrote: »

Didn't realise that. What's the rationale there? Surely the numbers work or don't?
I s'pose it's worries about losing your home and having to rent somewhere more expensive and then not being able to afford the BTL?
Surely that wouldn't matter if the BTL was self sufficient anyhow?

i guess it's all part of the credit score process.

a home owner with all things being equal would by default have a better credit score than a tenant who was renting.

the_flying_pig

Just returning to the real world for a moment:

(1) Rents not increased by very much at all in the last couple of years.

(2) 'Mortgage rationing' [i.e. something more than the most cursory imaginable check of the creditworthiness of borrowers] did not exist in any sense until a couple of years ago. Lenders were falling over each other to dish out 120% LTV to any idiot who could scrawl 'I am a citi banka, me, I earn lots of munny, pleeze lend me 5*joint fabricayted salari' onto an application form.

So it's plainly impossible that (2) caused (1), stupid even to suggest it.

If our rents really are higher than in Europe then I'd put it down to simple 'supply and demand' and/or our 'anything goes' housing benefit policy.