When will London burst ?

wotsthat

mwpt wrote: »

No offence but my understanding differs from yours. Rents aren't determined by landlords or what they are "willing to accept". We'll just agree to disagree

Of course they're set by the market - I'm simply explaining why lower rental yields aren't necessarily a simple function of excess supply.

Meanwhile you've purchased after explaining the plentiful supply of cheap rentals in London and warning about how recent price rises are credit fuelled. Go figure.

lisyloo

Meanwhile you've purchased after explaining the plentiful supply of cheap rentals in London and warning about how recent price rises are credit fuelled. Go figure.

There cansometimes be good reasons for doing things that don't fit with your financial predictions.
Not everything revolves always around money for everyone.

If everyone was driven by pure finance and logic then no-one would ever have a child :-)

I am certainly considering doing something (property wise) that isn't the best thing financially and I have reasons for that (I think the market will rise but I like living centrally and the flexibility that renting provides).

wotsthat

lisyloo wrote: »

There cansometimes be good reasons for doing things that don't fit with your financial predictions.
Not everything revolves always around money for everyone.

If everyone was driven by pure finance and logic then no-one would ever have a child :-)

I am certainly considering doing something (property wise) that isn't the best thing financially and I have reasons for that.

I'd happily pay a certain premium to buy rather than rent if required so I understand the argument.

However, I'm being told rentals are cheap and plentiful in London. Is this your experience?

I doubt it so it would be no surprise to me if you told me you were diverting your rent to buying instead (like mwpt) even if it meant you were paying an apparent premium over renting in the short term.

lisyloo

Is this your experience?

Definitely not cheap (although of course depends on your definition of "london" - zone 1 or M25?)
Supply depends entirely on your price point. We've not had issues with supply.

I doubt it so it would be no surprise to me if you told me you were diverting your rent to buying instead

Buying is probably financially prudent, but I don't like the compromises we'd have to make in terms of where we'd have to live and travel day in day out for years on end. Living day to day is important too.
We'll probably lose money overall renting, but we can live where we like, pack a suitcase when we like and don't have to buy any furniture, maintain anything or pay any service charges, repairs, insurance etc.
I appreciate the flexibility works both way but landlord wants to keep up longer at the moment. Things can go wrong whether you rent or buy, so there are risks both ways.

Landofwood

Is there a US forum with a thread "When will New York burst?".

Is there a French forum with a thread "When will Paris burst?".

Or is this purely a British pastime?

lisyloo

It's very much a British pre-occupation.
In europe they rent and have a different system.
In the US there is no lack of supply of land - that hasn't stopped them having issues, but lack of land isn't one of them.

mwpt

wotsthat wrote: »

However, I'm being told rentals are cheap and plentiful in London. Is this your experience?

I said that my observation is that London rents have risen broadly in line with general inflation (gentrifying micro markets excluded).

From that, you get to "rentals are cheap and plentiful"?

So, to be direct then, do you disagree with this observation? If lack of supply was the major cause of > 10% pa house price rises, I'd also expect to see > 10% pa rent increases.

wotsthat

mwpt wrote: »

So, to be direct then, do you disagree with this observation? If lack of supply was the major cause of > 10% pa house price rises, I'd also expect to see > 10% pa rent increases.

In the three months to April, average rental values for new tenancies in the UK were 10% higher than the same period last year

http://homelet.co.uk/homelet-rental-index

lisyloo

7.5% on London, so technically not > 10%, however quite shocking nonetheless.
I guess some of us renters will need to move further out just like buyers have to or make greater efforts to look for a job in other parts of the country.

If our rent went up 7.5% per year, then we'd probably pay it for a few years, but there would come a point where we'd consider our options and possibly start loking for jobs elsewhere.

Landofwood

lisyloo wrote: »

Definitely not cheap (although of course depends on your definition of "london" - zone 1 or M25?)
Supply depends entirely on your price point. We've not had issues with supply.

Buying is probably financially prudent, but I don't like the compromises we'd have to make in terms of where we'd have to live and travel day in day out for years on end. Living day to day is important too.
We'll probably lose money overall renting, but we can live where we like, pack a suitcase when we like and don't have to buy any furniture, maintain anything or pay any service charges, repairs, insurance etc.
I appreciate the flexibility works both way but landlord wants to keep up longer at the moment. Things can go wrong whether you rent or buy, so there are risks both ways.

Why do you always remove the name of the person you are quoting?