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BOE to get new regulatory powers over BTL
Comments
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The majority would not have been bought to let out so we would still have a shortgage of rental property although property prices might be slightly cheaper.
Not necessarily. I may be wrong, but from the experience of a colleague who used to rent in the 80's and early 90's, she always rented from property management companies.0 -
Graham_Devon wrote: »Not necessarily. I may be wrong, but from the experience of a colleague who used to rent in the 80's and early 90's, she always rented from property management companies.
Wouldn't bother me if BTL was eliminated but we need something to replace it.0 -
Thrugelmir wrote: »Somebody would have bought the property.
Most likely private landlords still. The decline in home ownership is a relatively recent phenomenon, and most of the growth in the private rental sector has been because of the lack of social rented housing coupled with the removal of rent controls. The demand for rental property hasn't changed that much. BTL exists because governments of both persuasions have decided they are no longer in the business of providing housing.
There's a nice overview of the last century here.
http://www.ons.gov.uk/ons/rel/census/2011-census-analysis/a-century-of-home-ownership-and-renting-in-england-and-wales/short-story-on-housing.html"Real knowledge is to know the extent of one's ignorance" - Confucius0 -
Private renting dropped by about 30% from 11% of properties to about 8% the 80s. Over the same period social housing decreased from 30% to 20%.
Wouldn't bother me if BTL was eliminated but we need something to replace it.
I'm not sure anyone is planning to eliminate BTL. Simply reduce some of the risks which it seems currently exist and by doing so, reduce the pace of buying by BTL landlords.0 -
Graham_Devon wrote: »I'm not sure anyone is planning to eliminate BTL. Simply reduce some of the risks which it seems currently exist and by doing so, reduce the pace of buying by BTL landlords.
As you know we need more affordable housing and the government are only paying lip service to that.0 -
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Graham_Devon wrote: »On the day that they announce further measures to regulate the BTL sector that seems a rather absurd thing to say really.0
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Private renting dropped by about 30% from 11% of properties to about 8% the 80s. Over the same period social housing decreased from 30% to 20%.
Wouldn't bother me if BTL was eliminated but we need something to replace it.
There were two enablers for BTL - the introduction of the AST in 1988 and the property crash of 1988 - 1995. The latter frightened a lot of people out of owning and consequently made them prepared to pay top, top dollar to rent. By 1996 it was possible for someone who'd bought in say the 70s or early 80s to take equity out of their house (which even post crash was still worth way more than they'd paid), put it down as a deposit, buy a house with a newfangled BTL mortgage and get paid more rent than the mortgage was costing. Instant positive cash flow.
These two factors enabled BTL and it always puzzles me why BTL-hating HPCers want a crash when any such crash will ensure a second BTL expansion.
Before the AST it was very hard to find rented accommodation. Think Man About The House, think Rising Damp - that's what it was like. In London there was also the Capital Radio Flatshare line. You phoned in and left a message describing the room you were prepared to offer to a lodger and every afternoon the DJ would read out a list of the latest ones between records. Letting whole properties out was governed by the Landlord and Tenant Act - known to property lawyers as just the Tenant Act because it was all about them.
We're headed back that way.0 -
Graham_Devon wrote: »Surprised to see this hasn't been posted up already. Maybe it's best not mentioned!?
Some seem to be suggesting we could be seeing BTL borrowers having to show that the rental income will be 150% of the mortgage. We could also see the minimum deposit raised to 40%.
Fantastic if it works.
http://www.bbc.co.uk/news/business-35120511
If my calculation are correct you would need a 4.5% yeald on a 75% mortgaged property at 4% to get 150% of mortgage repayment.0 -
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