BTL Returns

ClaireD85

Dunstable is quite a way from the nearest train station so may be less opportunity for capital growth or rent increases.

cells

ClaireD85 wrote: »

Dunstable is quite a way from the nearest train station so may be less opportunity for capital growth or rent increases.

Being close to a train station can command a small rent premium but it won't impact the capital growth or rental growth of the property. That is to say in a particular town or city properties will go up and down in tandom you won't find that the properties within walking distance of the train station double while the rest of the town stays put

Glover1862

It's priced at offers over £125k which she has had and refused, wants £130K, two booking over the weekend, I might ring on Monday and offer £125K maybe a little more if not sold. Not great buy but very easy and low maintenance, ground rent and service charge of £1534.00 is high, but no way I get anything freehold for that money.


Only option I have is look at areas a little further, Corby, Northampton, Peterborough, Luton/Dunstable seem to have increased loads, last year I got a 3 bed freehold house for £156K, now nothing less than £220K for similar houses.

chucknorris

michaels wrote: »

But if you str'd you would never have to buy back in so you could just look objectively at whether you could earn more on the capital currently tied up in your ppr than it would cost you to rent an alternative.....

But the reason that I want to own my own home isn't limited to finances, I want the additional freedom and security of tenure too. I would still own my own home even if I believed renting was cheaper (which it wouldn't be anyway).

cells

michaels wrote: »

Interesting comments that if yield went low enough some BTL owners would cash out....so thei begs the question, if yields go low enough would it make sense to sell to rent?

Obviously str is a very risky strategy as unless you never plan to own property again (which might be via helping children onto the property ladder rather than directly) then you are effectively 'short' housing. Plus of course PPR has huge tax advantages (arguably extremely unfiar but such is life).

However if it got to the point where the capital in your house could earn you 5k per month invested eleswhere and you could rent an equivalent house for 3k per month then str would start to make sense wouldn't it? (plus there is the saving on maintainance etc).

It wont get that extreme

Also yields are linked. If the yields on property fall its likely that the yields on alternatives like bonds and shares also falls making playing assets against each other unlikely to work.

Personally If I could get 3.5% yields I would be very tempted to sell to diversify just because of Norris theory (the one that says dont bet the house if your chips are already more than you can reasonably spend)

cells

Generali wrote: »

Time will tell.

If the bond market 'got it' then the BoE wouldn't have required £375,000,000,000-worth of QE to push interest rates down to 0%.

maybe mama bank saw an opportunity to make some big £££ from a silly over panicking market?

it gave the market cash now earning nowt in return for bonds paying 5%. That mr King was a genius

Generali wrote: »

Time will tell.
This time it's exactly the same as previously.

this is one thing I think we both look at completely differently

To me, modern history is very short that its difficult to impossible to make such a statement

There is the internet age (about post 2000) and the electricity age (about 1940/1950 onwards) and both were so recent.