buy to let

le_loup

ASutton wrote: »

House prices will not go down, to think they will is just ridiculous. This tax will only make people who can't afford to buy, largely due to their own financial irresponsibility, homeless.

Wow!
Are there no workhouses for these !!!!less ne'er-do-wells?

Brighty

booksurr wrote: »

?????

those properties, along with all the other such properties released by the floods of inadequately funded BTL'ers you are predicting will exit the market, can either be bought by a) homeowners who thus remove demand from the rental market or b) LL who thus increase their capacity and therefore introduce supply into the rental market

Disagree with you on both of those scenarios.
In a) homeowners who thus remove demand from the rental market. In that case, the property is also removed from the rental supply, so no net gain/loss. Also. some of the buyers will be in shared houses or living with parents, so no rental properties will be freed up by them buying, therefore a net loss in rental properties, an increase in demand.
In b) LL who thus increase their capacity and therefore introduce supply into the rental market.
It was a rental before, so no new supply is introduced, so no net gain/loss
So, there wqill be an overall net loss in rental properties and an increase in demand, pushing rents up.
As someone who is apparantly rich, ha ha (we only owe 7.5% of our 3 rental properties current value), i wondering if we should gear up a bit and mop up a few of these cheap rentals that are about to hit the market, then rake in the cash as rents rise.

Brighty

Daniel54

Brighty wrote: »

So, there will be an overall net loss in rental properties and an increase in demand, pushing rents up.
Brighty

The increase in the tax free rent a room allowance to £7.5k will very likely introduce more residential accommodation into the supply chain and might more than offset any reduction in the supply of lower end rental properties ( which is where the home leavers and sharers are likely to be)

It also makes renting a room an attractive alternative to letting out a rental property.

ASutton

booksurr wrote: »

?????

however rather than such simple economics, you "predict" the whole world will fall at the feet of the "rich" who will buy property they certainly don't want to live in (otherwise it would not be part of your rental portfolio) and do what with such mediocre property? Could they possibly do b)?????

increased supply = lower prices, but of course that does not suit your conspiracy theory.

Thanks for educating me on your 'simple economics'


With you're simple economics you fail to account for the huge shortfall in the housing market. 240,000 - 260,000 houses need to be built every year for the current demand. Between 2011-2014 the shortfall was nearly 520,000 therefore increasing demand.


Increased demand = Higher prices and first time buyers are no better off, as mentioned.