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Stock Markets Bombing!

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Comments

  • kennyboy66_2
    kennyboy66_2 Posts: 2,598 Forumite
    abaxas wrote: »
    There are two different financial transactions here in different markets.

    1) BTLer gets mortgage at 6%.
    2) BTLer sells service to tenant.

    The best way to look at this is that if the landlord wanted a 7% yield he wouldnt be able to obtain tenants. The rent is set by the market not the landlord ie the tenant's affordability.


    I should have made myself clearer.
    What explains someone buying a BTL property today borrowing at 6%, knowing that the yield will be 4%, surely they know what market rents are in the area ?
    US housing: it's not a bubble

     Moneyweek, December 2005
  • Generali
    Generali Posts: 36,411 Forumite
    10,000 Posts Combo Breaker
    kennyboy66 wrote: »
    If you meant the price of goods cannot be higher than the financing of them, what explains BTL'ers borrowing money at 6% to get a 4% yield ?

    A bubble mentality, 'it's ok, I'll make money on the capital gain'.
  • kennyboy66_2
    kennyboy66_2 Posts: 2,598 Forumite
    Guy_Montag wrote: »
    All this talk of immigration, particularly from Eastern Europe, to me has a lot of parallels with great that treatise on social conditions in the 1980s: Auf Wiedersehen Pet. In which a group of labourers went to Germany to work, since the economy in their home country couldn't provide them with jobs. They lived in overcrowded accommodation, and, most of them had no intention of staying once the economy in their home country improved.

    a) Not anywhere near the same scale
    b) Not many graduates went to Germany
    c) Not many workers took their children and enrolled them in schools.

    Perhaps a better parrallel would be Turkish emigration to Germany as guest workers.
    US housing: it's not a bubble

     Moneyweek, December 2005
  • abaxas
    abaxas Posts: 4,141 Forumite
    kennyboy66 wrote: »
    I should have made myself clearer.
    What explains someone buying a BTL property today borrowing at 6%, knowing that the yield will be 4%, surely they know what market rents are in the area ?

    I'm not going to be drawn into a argument over that!:A As well all know the answer is inflation.
  • dannyboycey
    dannyboycey Posts: 1,060 Forumite
    tonydee wrote: »
    Yes just a blip. Some good bottom fishing at around 6050. Gains for the rest of the week imo.


    5926 and falling. America's housing crash is contagious. Don't say you weren't warned.
  • kennyboy66_2
    kennyboy66_2 Posts: 2,598 Forumite
    Generali wrote: »
    A bubble mentality, 'it's ok, I'll make money on the capital gain'.

    the greater fool theory;)
    US housing: it's not a bubble

     Moneyweek, December 2005
  • CheeseOnToast
    CheeseOnToast Posts: 357 Forumite
    dannyboycey wrote: »
    5926 and falling. America's housing crash is contagious. Don't say you weren't warned.

    I've been watching it drop all morning as well, it's already dropped a point since you posted this !

    Luckily I am poor and don't have any investments to worry about lol :)
  • CheeseOnToast
    CheeseOnToast Posts: 357 Forumite
    Sorry make that 15 points lol
  • sm9ai
    sm9ai Posts: 485 Forumite
    Just keeps on going.
    5883.90 - down 225.40 (3.69%) :eek:
  • Guy_Montag
    Guy_Montag Posts: 2,291 Forumite
    1,000 Posts Combo Breaker
    sm9ai wrote: »
    Just keeps on going.
    5883.90 - down 225.40 (3.69%) :eek:

    What's a crash? 10%?
    "Mrs. Pench, you've won the car contest, would you like a triumph spitfire or 3000 in cash?" He smiled.
    Mrs. Pench took the money. "What will you do with it all? Not that it's any of my business," he giggled.
    "I think I'll become an alcoholic," said Betty.
This discussion has been closed.
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