The rental market

Shakethedisease

Having an I/O mortgage does not mean that the rates cannot be fixed.

..as a completely new mortgage application meeting current LTV criteria and/or a suitable lump sum to bring it up to said LTV. Which is what banks ie Santander etc are saying they're going to do for homeowners on current io mortgages when the deal is up.

Are there hardly any landlords out there currently on io deals then ? Like I said, I was under the impression that there were a fair few out there who had bought at peak when hpi was a sure thing hoping to sell and cash in later ?

IveSeenTheLight

Shakethedisease wrote: »

.Like I said, I was under the impression that there were a fair few out there who had bought at peak when hpi was a sure thing hoping to sell and cash in later ?

That's a bit of an assumption.

Look at the graph above, it seems that investors are increasing their private rental stock even after the house price peak, indeed more rapidly from 2007 - 2009 than from 2005 - 2007.

I bought in 2007, my valuation has risen since then, however I am not working on a short term gain.
BTL is predominantly invested by people who work on a long term gain.

Shakethedisease

So's this mate..

most BTL LL's have a fixed rate mortgage

And I don't give a scooby doo what 'private investors' are 'increasing'. I only wanted a few figures showing how many current landlords are on interest only deals compared to repayment deals. You stated casually that 'most' were on repayment. I'm not convinced frankly..

IveSeenTheLight

Shakethedisease wrote: »

So's this mate..



And I don't give a scooby doo what 'private investors' are 'increasing'. I only wanted a few figures showing how many current landlords are on interest only deals compared to repayment deals. You stated casually that 'most' were on repayment. I'm not convinced frankly..

Having a fixed, variable, tracker or discounted rate is a seperate factor from whether the property is capital and repayment or interest only.

Runining a BTL business generally work better if you fix your outgoings as your income is generaly fixed during th tenancy.

Granted recently, some may have moved on to SVR (as I have) given the current financial situation we are in where it is better to do so while the rates are so low.

Once that changes though, I'll certainly be re-fixing my BTL mortgage.

silvercar

Most BTL mortgages are interest only for tax reasons; only the interest element of a repayment mortgage is an allowable expense so it makes sense (from a business POV) to have an IO mortgage. Also remember that, unlike a residential mortgage where you want a property to live in in retirement, a let property can be sold.

Graham_Devon

Shakethedisease wrote: »

So's this mate..



And I don't give a scooby doo what 'private investors' are 'increasing'. I only wanted a few figures showing how many current landlords are on interest only deals compared to repayment deals. You stated casually that 'most' were on repayment. I'm not convinced frankly..

All the articles in the papers suggest majority of BTL mortgages are interest only.

Not sure what the figures are, just going on the articles I have seen about mortgages in the past.

ninky_2

i quite like the idea of some of the french model where rents are limited by an index and those on low incomes get zero interest home loans subsidised by the government.

sjaypink

IveSeenTheLight wrote: »

Was not convinced by the figures, so thought I'd do a bit of digging.
http://www.statistics.gov.uk/cci/nugget.asp?id=1105
Looks like in Q2 2009, there were: -
17.5 million owner occupiers
4.5 million social rented properties
3.8 million private rented properties



Interestingly

Thanks, just looked abck to where I saw my 'twice as many social houses for rent than private' & looks like that is based on 2001 census... things have certainly changed in last 10 years!

IveSeenTheLight

sjaypink wrote: »

Thanks, just looked abck to where I saw my 'twice as many social houses for rent than private' & looks like that is based on 2001 census... things have certainly changed in last 10 years!

Indeed, time move on.
With social housing declining and issues at the moment with Connaught (Social housing company), what would have happened if private investors did not return to the market as they did?
Remember a centuray ago, I think private rental was about 90% of the properties, now it's only about 15%

There was another graph (think it was from the bbc) which showed that while private renting increased, it was not by as much of a percentage of stock as the social housing decreased.

The population is increasing, social housing should not have been decreasing

kimsmarkin

We have our own house on the market after we saw the house we want. There were sold to first viewer at full asking price and £ 120 000 172 000 pounds was our desire to offer the property was approved. Almost two weeks later, we got a buyer and we had only two other spectators.