Debate House Prices
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BTL is in desperate need of reform
Comments
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chucknorris wrote: »The comment I made about rents was obviously based on the OP which makes it quite clear that the call is for longer contracts AND inflation capped increases.
Well, if the idea is to give tenants an increased security of tenure, then some form of rent regulation needs to be included or rent will just become a device for landlords to circumvent the legislation (ie increase rent by 50% instead of serving S21). At the end of the day, we will only be talking about a few percentage points. How much, as a percentage of rent paid, is a good tenant worth to you as a LL compared to an unknown one (or a void period)?0 -
chucknorris wrote: »What sort of tax relief are you advocating Steve? I think I am probably with Wee Willy on this one though as I think they can be problematic for tenants and unwelcome (if they receive additional tax incentives) competition for longer term landlords.
Rental income completly free of tax, so a person can move (say for a job) and rent elsewhere short term, maybe with the only penalty being letting agent fees.'Just think for a moment what a prospect that is. A single market without barriers visible or invisible giving you direct and unhindered access to the purchasing power of over 300 million of the worlds wealthiest and most prosperous people' Margaret Thatcher0 -
Wee_Willy_Harris wrote: »Quite the opposite. It's about time ALL landlords were regulated (and charged for the pleasure). The problems caused by know nothing, "accidental" landlords are costing us all a fortune. The sooner they either wise-up or get out, the better!
As I mention above, letting agents could add the 'expertise'.'Just think for a moment what a prospect that is. A single market without barriers visible or invisible giving you direct and unhindered access to the purchasing power of over 300 million of the worlds wealthiest and most prosperous people' Margaret Thatcher0 -
Wee_Willy_Harris wrote: »Well, if the idea is to give tenants an increased security of tenure, then some form of rent regulation needs to be included or rent will just become a device for landlords to circumvent the legislation (ie increase rent by 50% instead of serving S21). At the end of the day, we will only be talking about a few percentage points. How much, as a percentage of rent paid, is a good tenant worth to you as a LL compared to an unknown one (or a void period)?
Yes I understand the concept and of course agree that if longer term contracts were introduced then tenants would have to be protected from above inflation increases.
What I would be concerned about is not so much if things are going well because that would be no different to where I am now. My concern would be entering into a longer term agreement on a lower rent and the landlord/tenant relationship turns sour. If that happens I would not be happy taking a hit on the rent, and therefore if this was introduced I would prefer just to stick to market rents. I'm getting out in about 8-12 years anyway (probably) so it's not a major concern to me, as I am not going to be in the market for that much longer.Chuck Norris can kill two stones with one birdThe only time Chuck Norris was wrong was when he thought he had made a mistakeChuck Norris puts the "laughter" in "manslaughter".I've started running again, after several injuries had forced me to stop0 -
It's a deeply flawed analysis. The BTL opportunity only exists because there is a shortfall between home creation and home building. That is what needs to be fixed. Anything else is just Canute style tinkering on the shoreline.
The idea that cash is being removed from the economy into the "dead end of bubbles" is ridiculous too. It's just going to someone else who then maybe recirculates via loan interest payments into savings interest payments and other outlets. Actually it's the banking restrictions which are forcing potential first time buyers to stash their money away against deposit requirements which are removing money from the economy. And there is simply no evidence at all the housing is or was in a bubble anyway. Prices are sustained on the basis of competition for a limited supply.
For the rest, it's confirming what the "bulls" here have been saying. First time buyers are being squeezed out by investors, lending restrictions are making that worse rather than better. You don't need first time buyers to sustain the housing market because the overall demand for housing is high. Actually at the moment BTL investors have the whip hand anyway because lending restrictions are removing swathes of competition. When that comes back - and the clock is ticking because deposits are being saved - prices are going to shift sharply north again.
The obvious solution for the tenure issue incidentally is leasehold. That will start occuring to people soon.0 -
Rental income completly free of tax, so a person can move (say for a job) and rent elsewhere short term, maybe with the only penalty being letting agent fees.
Wouldn't this be open to abuse and difficult to police?
EDIT: Just noticed that you said 'short term'.Chuck Norris can kill two stones with one birdThe only time Chuck Norris was wrong was when he thought he had made a mistakeChuck Norris puts the "laughter" in "manslaughter".I've started running again, after several injuries had forced me to stop0 -
From the article.....Graham_Devon wrote: »Three reforms are necessary. First, we need to bring buy-to-let under the regulation of the FSA. Given that it was behind the economy-wrecking surge in "wholesale" lending, it is bizarre it still escapes oversight.Graham_Devon wrote: »Second, the FSA should require buy-to-let loans to be written on a repayment basis. It's not only prudent, it puts them on a level playing field with first-time buyers.Graham_Devon wrote: »Third, we need better protection for tenants, such as the abolition of assured shorthold tenancies, to be replaced with longer-term contracts and rules preventing landlords raising rents by more than inflation.
Rent controls? No thanks. I charge less than market rent and don't want to be stopped upping it to market rates, (or above!) if I so choose.0 -
JonnyBravo wrote: »Rent controls? No thanks. I charge less than market rent and don't want to be stopped upping it to market rates, (or above!) if I so choose.
Yes, I'm with you on this one.Chuck Norris can kill two stones with one birdThe only time Chuck Norris was wrong was when he thought he had made a mistakeChuck Norris puts the "laughter" in "manslaughter".I've started running again, after several injuries had forced me to stop0 -
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Removing one set of landlords from the market doesn't fix anything. The problem is low supply.
If you take out amateur landlords, and you prevent FTB from borrowing, you just create an opportunity for professional investors who don't need to borrow on mortgages. The underlying yield is still there. It's like trying to allow more people to win on musical chairs by moving chairs from room to room.
At some point this realisation is going to dawn on people, but it's a hard slog uphill for those of us who have been explaining this over past months.
Actually the best short term way to squeeze BTL out is to allow owner occupiers to compete with them, which will drive yields down (and prices up).0
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