Property market 'heading for a fall in 2008'

Guy_Montag

Generali wrote: »

They are still investors just not very sensible ones.

speculators, I think.

Presumably, if BTLers come to dominate the market for social housing, or just price out almost all OOs, there will be more calls for greater security of tenure. Not sure whether that would have an impact on house prices. I'm not sure that you can give genuine security of tenure without some form of rent control otherwise LL can say, "I'm not evicting you, just putting the rent up to £10 squillion a month".

Well the same standard as we currently have, rent cannot go up faster than the noticed period (or indeed twice the notice period). Are there not still fair rent tribunals?

I doubt the govt. will do anything about this, but the EU might decide to introduce a minimum standard.

thesaint

Guy_Montag wrote: »

I disagree that BTLers are investors. There are some that are, but the sums no longer add up. I can give countless examples of houses and flats for sale round me where the yield is below 4%, at a time when IRs are at 5.25%. That means that anyone buying will lose money from the start.

You are right however, that BTLers have taken up the slack left when councils sold off their stock. The difference being that with a council tenancy that lasted indefinitely and could be passed on to your next of kin. Unlike today where if you are a tenant you have at best 6 months (at the start) of assured tenancy, after that you're onto two months notice. If this was changed to guarantee security of tenure, even up to 6 months that would improve matters.

BTL landlords are investors, the 4% yield now may turn to 10% in the future.
They may lose money at the start, but property is usually a long term investment. The same could be said about stocks and shares.

No landlord wants to get rid of tenants after 6 months. It is not worth the hassle and expense. I would happily give secure tenure in exchange for rent paid on time.

If the powers that be said, "If you give secure tenure for 5 years in exchange for rent paid on time, we will remove a bad tenant in 1 month", I would snap their hand off.

Generali

Guy_Montag wrote: »

speculators, I think.

I had a discussion with a mate about what defined a speculator a while back. I think we came to the conclusion it was someone that invested for capital gain solely, not for any income (e.g. purchasers of commodities for 'investment' purposes). I guess under that definition, BTL is close as for most that post on here it seems that the aim is to get a capital gain not an income. Strictly speaking you do get an income though. I suppose that doesn't count if it's swallowed up by mortgage costs.

Guy_Montag wrote: »

Well the same standard as we currently have, rent cannot go up faster than the noticed period (or indeed twice the notice period). Are there not still fair rent tribunals?

http://www.rpts.gov.uk/our_services/rd.htm

RabbitMad

BTman wrote: »

I make 66K to 175K a 265% rise in 11 years

what a surprise, another BTL numpty who can't add up!!!

I may have only scraped a B at A level maths but I can do percentages! The house may now be worth 2.65 time what it cost 11 years ago but this is not the same thing as a 265% rise.

Maths lesson: -

increase £10 by 10% and you get £11
increase £10 by 100% and you get £20
increase £10 by 200% and you get £30

so, increase 66K by 100% and you get 132K
increase 66K by 200% and you get 198K
increase 66K by 265% and you get 240K

Anyway I'm a LTB numpty who can't add up!:rotfl:

ds1980

Speculating isn't that something you guys have been doing for the past 3 years about the housing market which still shows no signs of stopping.

Speculate all you like. Youve been wrong for god knows how long but i suppose its going to be quite easy saying i told you so whenever this supposed house price crash comes???

Why not be more helpful and start informing people what you think they should do.

Should people buy or sell? Stay where they are or should people go into rented?

Should people put more monies into savings if interest rates are supposedly going to rise??

Should people make investments in stocks and shares.

Think it is time you started to change the record isn't it?

Guy_Montag

ds1980 wrote: »

Speculating isn't that something you guys have been doing for the past 3 years about the housing market which still shows no signs of stopping.

Speculate all you like. Youve been wrong for god knows how long but i suppose its going to be quite easy saying i told you so whenever this supposed house price crash comes???

Why not be more helpful and start informing people what you think they should do.

Should people buy or sell? Stay where they are or should people go into rented?

Should people put more monies into savings if interest rates are supposedly going to rise??

Should people make investments in stocks and shares.

Think it is time you started to change the record isn't it?

I tell people (on here) all the time what I think they should do. In real life(tm) I don't because I might be wrong & I don't want anyone feeling that I gave them bad advice & that could interfere with my relationships. Anyone here that makes a decision based solely on what I say (I can be more convincing in reality) is an idiot.

Everyone should investigate their local market and make the best decision they can. That includes listening to people on here & elsewhere.

Generali

ds1980 wrote: »

Speculating isn't that something you guys have been doing for the past 3 years about the housing market which still shows no signs of stopping.

Speculate all you like. Youve been wrong for god knows how long but i suppose its going to be quite easy saying i told you so whenever this supposed house price crash comes???

Why not be more helpful and start informing people what you think they should do.

Should people buy or sell? Stay where they are or should people go into rented?

Should people put more monies into savings if interest rates are supposedly going to rise??

Should people make investments in stocks and shares.

Think it is time you started to change the record isn't it?

Generali's investment advice:

Personally, I favour cash, index linked bonds and reletively defensive stocks like utilities, pharmas and brewers - good income streams, unlikely to be exciting. If you want to buy shares, read A Random Walk Down Wall Street and the Newsletter on the Berkshire Hathaway wesite.

Investment is about risk IMVHO. A highly leveraged investment of any kind is going to be very risky. So is an illiquid one. A highly leveraged illiquid investment like some 'BTL empires' are very risky. If you have 85% leverage and face costs of, say, 2% to sell, a 10% fall in prices just about wipes you out. I have no problem with BTL as such if it's done with very big deposits and you're getting good yields. I think it's crazy to put all your eggs in such a very risky basket however - diversification is the only free lunch.

This is a slightly odd rant though - if you don't like the conversation, don't come into the room.

Flash_2

Melissa177 wrote: »

This is not true at all.

BTLers are investors. They aren't going to pay over the odds for a property to rent it out, otherwise the returns won't look be good.

I have to disagree. I was in a 'bidding war' with a BTL investor & in the end it went for way over the asking price. I really wanted the property & had been looking up to my maximum price, but I couldn't compete with the BTL person.

As I drive around I see property for sale, not all in my price range, the place gets sold & almost immediately a 'To Let' sign appears.

ds1980

Generali wrote: »

Generali's investment advice:

Personally, I favour cash, index linked bonds and reletively defensive stocks like utilities, pharmas and brewers - good income streams, unlikely to be exciting. If you want to buy shares, read A Random Walk Down Wall Street and the Newsletter on the Berkshire Hathaway wesite.

Investment is about risk IMVHO. A highly leveraged investment of any kind is going to be very risky. So is an illiquid one. A highly leveraged illiquid investment like some 'BTL empires' are very risky. If you have 85% leverage and face costs of, say, 2% to sell, a 10% fall in prices just about wipes you out. I have no problem with BTL as such if it's done with very big deposits and you're getting good yields. I think it's crazy to put all your eggs in such a very risky basket however - diversification is the only free lunch.

This is a slightly odd rant though - if you don't like the conversation, don't come into the room.

Didnt say i didnt like it its just boring reading the same thing over and over and over and over....oh there's a repitition here now also!

Generali

ds1980 wrote: »

Didnt say i didnt like it its just boring reading the same thing over and over and over and over....

Personally, I quite like it. It's like hearing an old record again. Especially some of my posts!