Rents rising again....

Percy1983

JonnyBravo wrote: »

I'm pretty sure as far as you were concerned they were great debts.
You borrow some money but you get someone else to pay it off.
Nice work if you can get it. :rotfl:

To summarise, If I borrowed from Paul, and then borrowed from Peter to pay Paul, Peter then rate jacked me so I borrowed off my fiancee to pay Peter.

I then paid everything back, in short we joined forces and saved thousands in interest accross the 2 of us which lead to us being able to buy a house sooner.

I will ask this question again with a real example this time, this month I paid £1030 in to the joint account and my other half paid in £700, does she owe me £330?

JonnyBravo

Percy1983 wrote: »

I will ask this question again with a real example this time, this month I paid £1030 in to the joint account and my other half paid in £700, does she owe me £330?

Here is another "real" example.

You buy a house for £100k.
Over the course of 20 years you pay off the mortgage.
The house is now worth, for example, £200k.
You want to buy another house.
Do you now sell it for £200k as that is what the market rate is or do you think to yourself "No, the market rate is too high, I'll sell it for £150k and borrow a little more to get my next house"?

Percy1983

JonnyBravo wrote: »

Here is another "real" example.

You buy a house for £100k.
Over the course of 20 years you pay off the mortgage.
The house is now worth, for example, £200k.
You want to buy another house.
Do you now sell it for £200k as that is what the market rate is or do you think to yourself "No, the market rate is too high, I'll sell it for £150k and borrow a little more to get my next house"?

Interesting idea lets do some maths:

Current House £100K, bigger house £150k

So right now I would need £50k to move up.

So as you say 20 years prices have doubled so its

Current House £200k, bigger house £300k

So I now need to find £100k to move up, so at a loss of £50k, now you say I should take another £50k hit and make the gap £150k and I wouldn't be losing anything.

Here is another sum. My house has gone up £100k yet the house I want has gone up £150k, so if I offset my 'profit' against the sellers 'profit' I am still losing.

Now here is a sum about your situation:

If you charge £50 less a month you will make £15000 less over 25 years, but you will still have a property paid for by somebody else and a profit.

So how are the 2 situations comparable again?

IveSeenTheLight

Percy1983 wrote: »

Gre
So what is the reason to increase rent it costs have dropped?

There is a debt that needs to be serviced.
Costs dropping should currently be seen as a bonus.
We all know that the same costs will rise in the future.

Rents are set at the achievable market rate, thus if we are currently seeing increased profitability by reducing costs and increasing rental income then it helps the business to provide a better return.

Flash forward 25 years, the properties could effectively have 0 costs, yet rents could still be incresing.

Think about supermarkets who increase produce whilst squeezing the supplier costs down.

It's a business. Why should it achieve the best profit it can make?

IveSeenTheLight

Percy1983 wrote: »

My business offers a cheap service and an excellent product to which they won't be left homeless if they don't buy.

I'm interested, what business do you have?
What is your CM?

JonnyBravo

Percy1983 wrote: »

So how are the 2 situations comparable again?

Entirely and clearly comparable.
As I've demonstrated.

You're asking me to "fund the market" so I think you should be prepared to.

You seem to think you shouldn't due to the source of the money? ie mine has come from my tenant whereas yours has come from your wages.



Here's a handy comparison to make things clearer for you:
I'm using my tenants money to pay off a debt and in return giving them a roof over their heads.
You used your partners money to pay off your debts and in return you gave her.....

ermmm....

a lecture on being careful with her money? That she shouldn't throw it away on rent when she could throw it away on your debts????

:rotfl:

I'd say your being a hypocrite Percy.

IveSeenTheLight

Percy1983 wrote: »

I will sell at the market rate as I will have to buy another one at the market rate. I can't see how that relates to how much a landlord squeezes their tenants? please do explain the link?

The link is that landlors set the rents also at the market rate.
If they set above the market rate that someone is willing to pay for then the property will remain empty.

So just as you buy / sell at the market rate, rents are also agreed at the market rate.

Greed has nothing to do with it.

I have three BTL's,

1. one has a tenant for over 5 years and they are paying the same rent in all those 5 years.
2. One rent was increased last year between tenants. They have advised they want to extend so I will keep the rents the same.
3. I bought my third in Dec 2011, It's right next door to property 1 and the rent is higher for the new property. I have tenants who signed a 2 year lease and if they stay beyond that day, I'll likely not increase their rents.

If I have good tenants I keep the rent the same.
If the properties are between tenants, I take the opportunity to realign my rents to nearer the market rate.

Am I greedy? I think not.
You can easilly rent a similar property maintened to a lower value for more, however this bodes well on my void statistic which is `6 days on one property in the last 5 years.

Percy1983

JonnyBravo wrote: »

Entirely and clearly comparable.
As I've demonstrated.

You're asking me to "fund the market" so I think you should be prepared to.

You seem to think you shouldn't due to the source of the money? ie mine has come from my tenant whereas yours has come from your wages.



Here's a handy comparison to make things clearer for you:
I'm using my tenants money to pay off a debt and in return giving them a roof over their heads.
You used your partners money to pay off your debts and in return you gave her.....

ermmm....

a lecture on being careful with her money? That she shouldn't throw it away on rent when she could throw it away on your debts????

:rotfl:

I'd say your being a hypocrite Percy.

Yet again, you are asking me to make a loss to fund the market while I am asking you to make less profit to fund the market.

You really can't let my personal finances go can you, even you know the sums all add up and it was a great idea which benefited us both as a couple.

So yes, I took money from my better half and then paid it back all in based on the idea of saving us both interest payments, you take money from strangers every month and give nothing back.

How are the 2 comparable again?

Percy1983

IveSeenTheLight wrote: »

I'm interested, what business do you have?
What is your CM?

CM? sorry I don't understand.

JonnyBravo

Percy1983 wrote: »

Yet again, you are asking me to make a loss to fund the market while I am asking you to make less profit to fund the market.

You really can't let my personal finances go can you, even you know the sums all add up and it was a great idea which benefited us both as a couple.

So yes, I took money from my better half and then paid it back all in based on the idea of saving us both interest payments, you take money from strangers every month and give nothing back.

How are the 2 comparable again?

You're not making a loss.
It is you comparing apples and oranges.
You're comparing the sum you receive when you sell your house against the value of something else you want to buy, not the cost of the item you bought.
Yet you are expecting me to compare the rental I receive vs the cost of what I bought. Well I want to buy an aircraft carrier with the rent I receive and that costs £1bn.
How can I afford to make such a large loss?

Get it yet?