Ban BTL landlords from buying new builds

Cornucopia

Unfortunately, if it is housing density you are after, there is no substitute for flats.

I think London is probably now broken in terms of providing large amounts of affordable accomodation. What needs to happen is improvements in transport to less developed areas that are 15-30 miles/minutes away, and a sensible/sustainable approach in those areas to the development of new housing with a good mix of affordable/mainstream and rent/buy.

The relative prosperity of BTL at the moment is a feature of our dysfunctional housing market, not its cause. In fact, it reflects a market position where (for a variety of reasons) renters are over-paying on rent rather than buying. Part of this will be deposits, and part of it will be uncertainty.

Government tinkering rarely helps.

Disclaimer: I am a BTL landlord.

CLAPTON

[QUOTE=Cornucopia;62286565

I think London is probably now broken in terms of providing large amounts of affordable accomodation. What needs to happen is improvements in transport to less developed areas that are 15-30 miles/minutes away, and a sensible/sustainable approach in those areas to the development of new housing with a good mix of affordable/mainstream and rent/buy.




Disclaimer: I am a BTL landlord.[/QUOTE]


bizarre
15-30 minutes away?

Cornucopia

CLAPTON wrote: »

bizarre
15-30 minutes away?

On improved transport links.

That's only 60mph - surely the UK's public transport industry is capable of that!

30-45 minutes, if you want to make excessive allowance for acceleration and declaration.

JencParker

15 - 30 minutes away? Are you joking. Even living in a London suburb travel into the city is likely to be 1 - 1.5 hours door to door!

The abolition of rent control and the introduction of BTL has made some richer at the expense of those poorer. Property has always been an investment, but when you have to take out a mortgage the tenant is paying both the bank, through the BTL's mortgage and the profit the BTL LL wants to make on top. Unfortunately, this love of making as much money as you can and putting profit before anything leads to the greedy rising to the top and those left paying for it. Can't see any change until people's attitude towards money changes.

Cornucopia

I live near Ebbsfleet - the only new station on the Channel Tunnel High Speed link. That takes 17 minutes to cover 20 miles to London St Pancras, including a stop at Stratford. That's the kind of performance you need in order to make a difference. Unfortunately, there's very little development within walking distance of that station, which makes me wonder about joined-up thinking by the planners - and yes, there appears to be plenty of land.

One of the reasons why London is over-heated is because people don't want to spend 1.5-2 hours a day on a commute of maybe only 15 miles.

The problem with rent control is that it may make some BTLs uneconomic. In which case they would disappear - with the property being sold off - some of those properties might be affordable to buy, but I wouldn't bet on it. The idea of private landlords subsidising the rental market is completely unrealistic.

JencParker

Cornucopia wrote: »

I live near Ebbsfleet - the only new station on the Channel Tunnel High Speed link. That takes 17 minutes to cover 20 miles to London St Pancras, including a stop at Stratford. That's the kind of performance you need in order to make a difference. Unfortunately, there's very little development within walking distance of that station, which makes me wonder about joined-up thinking by the planners - and yes, there appears to be plenty of land.

One of the reasons why London is over-heated is because people don't want to spend 1.5-2 hours a day on a commute of maybe only 15 miles.

The problem with rent control is that it may make some BTLs uneconomic. In which case they would disappear - with the property being sold off - some of those properties might be affordable to buy, but I wouldn't bet on it. The idea of private landlords subsidising the rental market is completely unrealistic.

Of course, rent control had to be done away with to make way for BTL. BTL isn't the only problem, selling of council houses and not replacing them with affordable housing has also contributed. But the reason it would make BTL disappear is because BTL has to borrow in order to buy, thus requiring rent that covers both a mortgage AND makes a profit for the LL. I wonder how many BTL LL would still be LL if they had to pay for the property in full, without a mortgage. Very few I suspect, but those who do would still get for a good return while charge a fair rather than the high prices they charge (I'm old enough to remember the pre rent control abolition days ). With less and less affordable (LA or housing association) property available, those who have to rent are getting squeezed even more. And it's not just about cost. The lack of security of tenure makes it hugely stressful for renters. Would you like to live with the uncertainty of where you are going to live year in and year out?

That said, I can't see things changing. Too many vested interests and the society we live in now sees money as a commodity. It won't affect me - my mortgage is almost paid off, but I do despair about the society we have left our children. The rents they paid while going through university were ridiculous for a student, but it made the LL happy. In spite of good education and good jobs they will not be able to save the amounts needed while paying the rents at the level they are now having to.

CLAPTON

rent controls increase demand for properties
and decrease supply

to reduce prices we need to build more houses

JencParker

CLAPTON wrote: »

rent controls increase demand for properties
and decrease supply

to reduce prices we need to build more houses

Rent controls prevents land lords to charge high rents regardless of market forces. Without a mortgage to pay, LL could still make a profit regardless of market forces.

Yes, we need to build more houses, but I doubt that would make much of an impact as BTL landlords still have to pay their mortgage as well as make a profit.

Building more houses will also do nothing to help the tenant regarding long term security of tenure.

Are you a BTL LL by any chance

CLAPTON

JencParker wrote: »

Rent controls prevents land lords to charge high rents regardless of market forces. Without a mortgage to pay, LL could still make a profit regardless of market forces.

Yes, we need to build more houses, but I doubt that would make much of an impact as BTL landlords still have to pay their mortgage as well as make a profit.

Building more houses will also do nothing to help the tenant regarding long term security of tenure.

Are you a BTL LL by any chance

Maybe you are an extremely rich person that doesn't need to take any account of the price of things you buy.

The vast majority of us do take account of the price when we buy things
so a lower price will increase demand

Equally it is true that increase in price will attract more supply so if the rental income decreases there will be fewer landlords willing to rent property out.


The question of long term security of tenure is worthy of considered thought as is the question of more council housing but rent controls are a bad idea as they increase demand that can't be satisfied and decrease supply.

JencParker

CLAPTON wrote: »

Maybe you are an extremely rich person that doesn't need to take any account of the price of things you buy.

The vast majority of us do take account of the price when we buy things
so a lower price will increase demand

Equally it is true that increase in price will attract more supply so if the rental income decreases there will be fewer landlords willing to rent property out.


The question of long term security of tenure is worthy of considered thought as is the question of more council housing but rent controls are a bad idea as they increase demand that can't be satisfied and decrease supply.

I am very far from being rich and have had to struggle and work hard all my life. However, if you ONLY apply the laws of supply and demand to basic human needs in a capitalist society you will always find those who are only out to make money at the expense of those less well off. That is why you need some sort of regulation.