Why do people resent buy-to-letters so much?

michaels

chucknorris wrote: »

I found this bit interesting:

Teacher Helen Kinsey, 50, recently had to leave her home in south London, after living there for 21 years, when her landlord demanded a 30% rent rise. "I think people feel this animosity towards landlords because there are so many stories like mine," she says. Greedy landlords and greedy developers and greedy agents are seeing an opportunity to keep pushing the rent up. So normal people like me are being pushed out.

...

What she seems to be oblivious to, is that she benefited from a rent 30% below the market value (probably for many years), yet her reaction is to call her landlord greedy, for wanting to charge the market rent, I think she is extremely ungrateful for the years she enjoyed renting below the market value.

That is exactly what I thought - how ungrateful to moan that you had been undercharged for something for many years and might now have to pay the true cost.

kabayiri

The BTL market does need the occasional recession now and then to filter out the less committed.

If we accept that recessions help companies become leaner and stronger, then why shouldn't this also apply to the BTL industry?

I reckon we have a new generation growing up who don't see the terms 'asset', 'investment' and 'risk' in the same sentence. Wasn't it this sort of hubris which led to the GFC?

kabayiri

michaels wrote: »

That is exactly what I thought - how ungrateful to moan that you had been undercharged for something for many years and might now have to pay the true cost.

It seems clear that our teacher friend Helen is struggling to cope with change at that level.

It would have been better for her if her rent went up by 5% on 6 successive occasions.

I'd be pretty unhappy if my council tax went up by 30% next year, or my car insurance. I'd be accusing the council of some mismanagement.

michaels

kabayiri wrote: »

It seems clear that our teacher friend Helen is struggling to cope with change at that level.

It would have been better for her if her rent went up by 5% on 6 successive occasions.

I'd be pretty unhappy if my council tax went up by 30% next year, or my car insurance. I'd be accusing the council of some mismanagement.

But if the council had miss-billed you for the last 10 years so that whilst your neighbours charge went up every year yours had stayed the same saving you thousands of pounds and then they had noticed and told you that from next year you would have to pay the correct amount but wouldn't be asking you for the previous shortfall I can't see that you would complain...

kabayiri

michaels wrote: »

But if the council had miss-billed you for the last 10 years so that whilst your neighbours charge went up every year yours had stayed the same saving you thousands of pounds and then they had noticed and told you that from next year you would have to pay the correct amount but wouldn't be asking you for the previous shortfall I can't see that you would complain...

The situation you describe did happen to someone I know who was in the wrong band, and they were given time to adjust to the increase. I guess this acknowledged it was the council who had messed up.

But there is no suggestion of mis-billing in this case is there? I must be missing something.

BananaRepublic

p00hsticks wrote: »

This ignores the fact that not everyone *WANTS* to own their own house, even if they could afford it. There is a section of society who, for various reasons, do not wish to commit themselves to such a major purchase and responsibility - perhaps because they move location frequently.

I've met lots of people who rent because they cannot afford to buy, some with families. I have rented through choice, I suspect most don't.

BananaRepublic

There are millions of decent people who cannot afford to buy a house. BTL pushes up prices, so it's hardly surprisingly landlords are despised. The system is unjust. People renting will on retirement probably need state benefits to survive, so the landlords profit costs us tax relief and benefit payments.

You don't need to invest in houses for a pension. Pension funds can do well, and you get tax back. ISA funds do well, and the final sum is tax free.

I wonder if mortgage interest tax relief will disappear altogether? I didn't get it on my home.

chucknorris

BananaRepublic wrote: »

You don't need to invest in houses for a pension. Pension funds can do well, and you get tax back. ISA funds do well, and the final sum is tax free.

No, you don't need to, but it is good to have a diversified portfolio, at the moment my INITIAL retirement portfolio target is:

37.5% property
37.5% equities
25% fixed pension (state and DB)

I might get interested in bonds after interest rates increase in which case I might aim for:

37.5% property
22.5% equities
25% fixed pension (state and DB)
15% bonds

antrobus

Generali wrote: »

Why do people resent buy-to-letters so much?

I have a theory.

Many people moan about 'greedy' landlords, in the same way as they moan about 'greedy' energy companies, insurers, or the local supermarket for putting up the price of butter. On the other hand, Apple, they're simply wonderful, and the same people fall over themselves to buy the latest i-whatever repackaging of £100's worth of Chinese electronics into a £600 consumer must have.

I think it's because 'people' have this odd idea that somehow it's wrong to make a profit out of something that is viewed as essential.

westernpromise

Donnie_Darko wrote: »

BTL drives up prices and removes properties that other people could buy.
There is NOT a housing shortage in the UK, but there's not enough for more than one each.

What is the right number of homes for the UK and how should they be allocated?