The Moral of a BTL.....?

CLAPTON

JencParker wrote: »

It has risen quite a lot in the last few years (doesn't everything!).

The lounge was used as another bedroom. Having rented a number of properties between them during their uni years, and same with friends - it seems pretty standard to turn reception rooms into bedrooms. The lucky ones may get a communal area in a larger kitchen, otherwise there is no communal area.

maybe that was so in the nottingham area
but my kids always had a separate lounge although the kitchen area tended to vary a lot in size.

but as I say, the market should sort out the price/ facilities issues.

JencParker

CLAPTON wrote: »

maybe that was so in the nottingham area
but my kids always had a separate lounge although the kitchen area tended to vary a lot in size.

but as I say, the market should sort out the price/ facilities issues.

Only one of mine was at Nottingham - although it's good that yours were able to find better accomodation.

Unfortunately, I can't share your belief that the market will sort it out. The market has made it what it is, and all the time those that hold the position to change things are those who are driven by money and profit, things will not change.
It's a bit like the generation of students that were encouraged to go to university to get a degree to improve themselves and find they are working behind a till at John Lewis with a student debt of £20,000.

black_taxi_2

it makes my BLOOD BOIL,when landlords say they choose to rent

IveSeenTheLight

JencParker wrote: »

My children did a lot of search and they were all pretty much a similar standard. Cheaper accommodation was available but in even worse condition. People's obsession with 'choice' fails to acknowledge that choice is limited to what is available!.

I understand, hence there should be a case for more BTL to expand the choice and drive down the rents.

for many on here, BTL is castigated.

JencParker wrote: »

Your flat looks very nice, however, you make no mention of where it is it's value, what you charge and what profit you make.

I see no need to provide it's details. It's irrelevant to your children's needs.
It's a 2 bed flat with large lounge, dining kitchen, bathroom with shower and three large storage cupboard.

I rent out to two students only and I get a nice 13.2% return on my investment with no voids

JencParker wrote: »

To make £32k per year for a small victorian terrace by packing in as many students as you can, who are already on very limited incomes is very profitable for the LL and their business - but at a high cost to others.

It would seem to me that you could immediately improve this property by renting for £90 per week per room and leave the lounge as is.
You'd still have a £28,000 income with a £11,000 mortgage interest.

That is assuming your £32,000 income is based on a 52 week rental and there are no voids included out of term.

I'm no expert in the Nottingham rental market, but if your children was paying £385 per month (£89 *52 / 12) then you could have a better option of something like the following

http://www.rightmove.co.uk/property-to-rent/property-38230946.html?showcase=true

2 sharing would be £400 per month with the quality and space you would prefer.

JencParker

IveSeenTheLight wrote: »

I understand, hence there should be a case for more BTL to expand the choice and drive down the rents.

for many on here, BTL is castigated.



I see no need to provide it's details. It's irrelevant to your children's needs.
It's a 2 bed flat with large lounge, dining kitchen, bathroom with shower and three large storage cupboard.

I rent out to two students only and I get a nice 13.2% return on my investment with no voids



It would seem to me that you could immediately improve this property by renting for £90 per week per room and leave the lounge as is.
You'd still have a £28,000 income with a £11,000 mortgage interest.

That is assuming your £32,000 income is based on a 52 week rental and there are no voids included out of term.

I'm no expert in the Nottingham rental market, but if your children was paying £385 per month (£89 *52 / 12) then you could have a better option of something like the following

http://www.rightmove.co.uk/property-to-rent/property-38230946.html?showcase=true

2 sharing would be £400 per month with the quality and space you would prefer.

As I've always brought up my children to be independent in both thought and deed, my preferences are irrelevant

How is paying more accommodation a better option when already on a very tight budget - a loan, which they will spend a good number of years paying off?


There are obviously students with well off parents who add to their children's student budgets and I'm sure many landlords benefit from that, but many are not in that position.

CLAPTON

JencParker wrote: »

Only one of mine was at Nottingham - although it's good that yours were able to find better accomodation.

Unfortunately, I can't share your belief that the market will sort it out. The market has made it what it is, and all the time those that hold the position to change things are those who are driven by money and profit, things will not change.
It's a bit like the generation of students that were encouraged to go to university to get a degree to improve themselves and find they are working behind a till at John Lewis with a student debt of £20,000.

That seems confusing

If people driven by profit and money had been available in the Nottingham area then the rental market would have expanded and the price would have dropped so your child would have had a cheaper and/or better experience.

So if you are correct about Nottingham it is obviously lacking in what you call greed : maybe too many Guardian readers or people that lack enterprise.
The people able to changes things there are people like you and not a vague conspiracy of dark individuals.

I partly agree about the expansion of the Unis; an example of centralised well intentioned planning without any direct profit motive to moderate the absurdity. The road to hell being paved with good intentions and all that.

wotsthat

JencParker wrote: »

It's a bit like the generation of students that were encouraged to go to university to get a degree to improve themselves and find they are working behind a till at John Lewis with a student debt of £20,000.

That's twice you've said that.

http://www.bbc.co.uk/news/education-23080323

Out of a total of more than 230,000 full-time graduates from 2011-12 whose destinations were known, 72% were working, or working and studying; 15% were studying and 9% were unemployed.

Nearly two-thirds of those working in the UK were in professional roles, with the remaining third working in sectors that did not require a degree, according to Hesa.

i.e. 48% in graduate roles, 24% in non-graduate roles, 15% still studying and 9% unemployed. Don't know what the missing 4% are doing.

Of course you know someone with a degree that works at John Lewis so a whole generation of graduates must work there.

Conrad

Graham_Devon wrote: »

If he had instead taken fewer houses and put up more of a deposit on each, negative equity may not now be an issue. He may well have been able to remortgage (one of his issues was that no one would take him on) and may not have had to sell up, thereby never effecting the tenants.

You make a good point here, but can I just tackle this 'greed' label that is bandied about.
Greed is not always the point of the exercise.
Often people are motivated by the fact their mates a due a large inheritance or employers pension whereas they are not, so they have this added drive to 'catch-up'.

I think this is why B2L is particularly prevalent with certain immigrant communities where they have not been here sufficiently long to be able to benefit from a parental inheritance, thus this desire to catch up kicks in.

In my case we want a comfy retirement, nothing particularly greedy.

IveSeenTheLight

JencParker wrote: »

As I've always brought up my children to be independent in both thought and deed, my preferences are irrelevant

How is paying more accommodation a better option when already on a very tight budget - a loan, which they will spend a good number of years paying off?


There are obviously students with well off parents who add to their children's student budgets and I'm sure many landlords benefit from that, but many are not in that position.

Ok, it was just a quick link.

Even better, here's a 3 bed house for £650 pcm.
Equivalent of £50 per week each AND it also has a nice garden

http://www.rightmove.co.uk/property-to-rent/property-27752058.html?showcase=true

I think this answer a lot of your frustrations on cost and space

l_wr

Some things to be mindful of when considering entering the BTL market for the first time.
1. It is becoming a heavily saturated market.
2. Interest rates are at their lowest for 300 years and could (will) rise from here, causing costs to rise for many homeowners including BTL's.
3. House prices in the UK are one of the most expensive in the world compared to incomes. At 6.5X (£168K divided by average salary £26K) it is 3X above the 100 year average of 3.5X.
You could see a large fall in your capital value in coming years, once the governments loan support scheme peters out.
4. Student numbers are falling due to the heavy increase in fees.
5. Inflation is rising faster than peoples wages, meaning there is less disposable income amongst the working population.
6. Housing benefit is unaffordable for this government and it is unlikely to continue at it's current level. It's a well known fact that many BTL's rely on housing benefit to support their ever increasing rent - once this crutch has been removed, rents will have to fall and asset prices (house prices) will fall with the lower rents - they are intrinsically interlinked.