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Debate House Prices


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Financial Transaction Tax - Does it make property more attractive to investors?

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Comments

  • purch
    purch Posts: 9,865 Forumite
    Renoman but this is the point I am trying to make, is how do you pay down the IO mortgage if the the rent you get barely covers the mortgage and the other overheads.

    Personally I can not see how this fits the definition of Buy to Let.

    It is Borrowing to Let.

    It gives those of us who were smart and forward thinking enough to see that property prices were at historically low prices, and then invested their Cash in order to obtain a high return, a bad name.
    'In nature, there are neither rewards nor punishments - there are Consequences.'
  • Generali
    Generali Posts: 36,411 Forumite
    10,000 Posts Combo Breaker
    I see what you are saying Generali but inflation will also affect such costs as repairs, insurances etc.

    It will but not the principal sum owed which is probably the largest cost in your example.

    When I can be @r$ed I'll get the spreadsheet out and do some sums.
  • purch wrote: »
    Personally I can not see how this fits the definition of Buy to Let.

    It is Borrowing to Let.

    It gives those of us who were smart and forward thinking enough to see that property prices were at historically low prices, and then invested their Cash in order to obtain a high return, a bad name.

    Yes this is exactly what I think it is these days.
  • RenovationMan
    RenovationMan Posts: 4,227 Forumite
    Renoman but this is the point I am trying to make, is how do you pay down the IO mortgage if the the rent you get barely covers the mortgage and the other overheads.

    The problem you've got is that your calculations are fixed for 25 years. You have the BTL guy making £180 per month for 25 years. No wonder you can't see where the money comes from to pay down the mortgage.
  • shortchanged_2
    shortchanged_2 Posts: 5,546 Forumite
    edited 15 March 2012 at 2:22PM
    The problem you've got is that your calculations are fixed for 25 years. You have the BTL guy making £180 per month for 25 years. No wonder you can't see where the money comes from to pay down the mortgage.

    Yes I suppose you're right.

    It could be more or it could be less.
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