Owner Occupiers > BTL Landlord

ukcarper

HornetSaver wrote: »

True



False.

Affordability and supply and demand are two distinct concepts. Rentals in Hertfordshire are plentiful though gradually becoming less so (as there is a high housing stock relative to jobs located within the county, meaning that there are always rentals on offer but population shift from London is on the rise) but expensive (because the costs to wages ratio in Hertfordshire is high even by London Commuter Belt standards).

How long are these rental properties on the market before they are let.

HornetSaver

HappyMJ wrote:

The property I live in isn't really ideal for an OO.

The only possible reasons I can imagine for this statement are that you are renting a room within a shared house, you have mistaken "an OO" for "me" (don't worry, a lot of people on this forum mistake "cheap" with "less than what they earn"; this is by comparison a minor mistake), or you are living in a building which has serious structural problems and will need to be demolished within the next decade or so.

It's a free market. Isn't going to happen.

CLAPTON wrote: »

it provides no guidance on how to solve the problem.
if indeed there is a problem to solve.

From Google:

Affordability. The extent to which something is affordable, as measured by its cost relative to the amount that the purchaser is able to pay.

The question therefore is defining the purchaser. In the context of renting, I define the purchaser within a market as a person who works within that market before and after renting, and goes on to rent anywhere - within that market or further afield. Clapton uses the simpler definition of "person who rents within that market, regardless of reason and place of work".

Short version: if simpler was better, Communism would work in practise, and we thus wouldn't be having this discussion.

Long version: unnecessary commutes are no good to anyone. There are low-to-average paying jobs in Hertfordshire which pay 15-20% more than identical jobs would pay even as far south as Leicester, never mind most people's definition of the north.

Why do they pay more? Because they can't recruit the number of workers they need at the wages they could pay up north, to the standard and levels of labour turnover they would get up north, and have a geographical need to have a southern presence. Jobs like manufacturing (high tech because there is a need to draw on talent from London, low tech because London is a big consumer and also because of the number of airports in proximity), logistics, retail are the main ones that most immediately come to mind. But who are those higher wages good for?

The worker, whose disposable income after housing and travel costs is lower than their northern counterpart?

The businesses, who are paying higher wages for no direct productivity benefit?

The government, who have to spend more on infrastructure to pay for all the mileage being done by people who apparently don't need to live where they work, and are seeing productivity and exports stagnate because the business is running less efficiently than it needs to?

The BTL landlord, who is creaming it from increase revenues due shifting demand, with no increased costs relative to when demand was lower?

Clapton has asked me to put forward suggestions to solve the problem. And the thrust of my solution is that you don't touch the free market directly, but you use the public stock in a way that ensures the private rental sector fills the appropriate gaps.

1. Build enough social houses to cater for those who couldn't possibly afford the market rate (reducing demand in the private sector without directly touching the free market).

2. Means test social housing rent on an annual basis, with no upper cap. Thus those earning enough to survive in the private sector will either move on to free up housing for someone in need, or stay but help subsidize the lack of rent coming from others.

3. Scrap the right to buy outside of London, and replace it with putting a small percentage of rent taken into a savings pot, which is given as a once-only golden handshake to help people with the transition from public to private housing (whether they choose to use that to rent or to buy would depend on their circumstances, how much they had built up, etc, but in practise the amount spent should be comparable to the amount of subsidy in the right to buy scheme - smaller amounts to more people).

4. Impose meaningful levels of enforcement and punishment for financial crimes, and introduce a lifetime ban on social housing for those convicted of fraud above a certain level. Okay, not entirely or even predominantly housing related, but it's part of the big picture. Benefit fraud and tax evasion are rampant in this country, because even when you are caught the punishment generally does not reflect the full benefit of the crime. Ensuring that the right people are in the right homes is a huge part of that.

5. Once all the above is in place, scrap housing benefit altogether. No-one who truly believes in the free market could possibly object to this step, unless of course they directly benefit from it

6. Politely ask those house owners bemoaning the negative effect on their property value to emigrate (but leave them to their own devices if they choose not to).

Numbers 2 and 3 would ease the problems of those moving into social housing being very difficult to move on and the stock being very difficult to replenish. Numbers 1 and 4 would directly affect demand in the private rented sector, without actually touching the market itself. Number 5 is the logical extension of a parallel housing system that is functioning normally (those who can afford rent in the free market, those who can prove that they don't pay what they can in the public sector). Number 6 is because I won't be posting again for at least a day but want to pre-emptively give my love to the usual suspects.

CLAPTON

mwpt wrote: »

Why must you complicate or try to spin the story? It is a simple fact that the top bidder on a property wins the property. If that bidder is a BTL bidder, he has outbid anyone else.

When I bought my property, I outbid any other potential buyers. For some reason, BTL landlords are very averse to simply admitting that they outbid OOs. It's weird.

its a simple fact that the top bidder wins whether they are OO or LL or a local criminal or a HA or a parent buying for a offspring or a person buying for their parent etc. In all cases they have stopped a great number of people owning that property.

so what? is that wrong, evil, undermines society, threat to financial stability or what?

just how things work

cells

mwpt wrote: »

Why must you complicate or try to spin the story? It is a simple fact that the top bidder on a property wins the property. If that bidder is a BTL bidder, he has outbid anyone else.

When I bought my property, I outbid any other potential buyers. For some reason, BTL landlords are very averse to simply admitting that they outbid OOs. It's weird.

landlords are only proxy bidders for tenants

a landlord does not out bid a would be owner, the tenants outbid a would be owner and usually that makes perfect sense as 4 tenants working full time outbid a a couple 1working full time and the other part time.

cells

CLAPTON wrote: »

its a simple fact that the top bidder wins whether they are OO or LL or a local criminal or a HA or a parent buying for a offspring or a person buying for their parent etc. In all cases they have stopped a great number of people owning that property.

so what? is that wrong, evil, undermines society, threat to financial stability or what?

just how things work

the highest bidder generally has the highest need/want and its a way to allocate a limited resource. The other way of a lotto or quota stamps has not worked so well for most other goods

And once more, a landlord is only a proxy bidder for tenants

mwpt

CLAPTON wrote: »

its a simple fact that the top bidder wins whether they are OO or LL or a local criminal or a HA or a parent buying for a offspring or a person buying for their parent etc. In all cases they have stopped a great number of people owning that property.

so what? is that wrong, evil, undermines society, threat to financial stability or what?

just how things work

So you're posting this little foot stamp, but actually you're just agreeing with what I said. I'm not sure what your point is.

cells

mwpt wrote: »

Every time a BTL buys a property they outbid an OO

Dont you think it would be a lot more sane to look at who the BTL bought from?

More than 95% of my purchases were from other landlords, so by in large landlords tend to buy off other landlords.

This makes sense as the properties people buy and rent tend to be different. I am not going to be buying a 5 bed detached where the owner has spent £200k in renovations it would make no sense as a rental. Likewise if I were looking for a home to own for the next 20 years I would not be looking at studios or 1 bed properties.

CLAPTON

mwpt wrote: »

So you're posting this little foot stamp, but actually you're just agreeing with what I said. I'm not sure what your point is.

I think we agree : there is no point in observing that the winning bidder out bids the others.

CLAPTON

HornetSaver wrote: »

The only possible reasons I can imagine for this statement are that you are renting a room within a shared house, you have mistaken "an OO" for "me" (don't worry, a lot of people on this forum mistake "cheap" with "less than what they earn"; this is by comparison a minor mistake), or you are living in a building which has serious structural problems and will need to be demolished within the next decade or so.




From Google:

Affordability. The extent to which something is affordable, as measured by its cost relative to the amount that the purchaser is able to pay.

The question therefore is defining the purchaser. In the context of renting, I define the purchaser within a market as a person who works within that market before and after renting, and goes on to rent anywhere - within that market or further afield. Clapton uses the simpler definition of "person who rents within that market, regardless of reason and place of work".

Short version: if simpler was better, Communism would work in practise, and we thus wouldn't be having this discussion.

Long version: unnecessary commutes are no good to anyone. There are low-to-average paying jobs in Hertfordshire which pay 15-20% more than identical jobs would pay even as far south as Leicester, never mind most people's definition of the north.

Why do they pay more? Because they can't recruit the number of workers they need at the wages they could pay up north, to the standard and levels of labour turnover they would get up north, and have a geographical need to have a southern presence. Jobs like manufacturing (high tech because there is a need to draw on talent from London, low tech because London is a big consumer and also because of the number of airports in proximity), logistics, retail are the main ones that most immediately come to mind. But who are those higher wages good for?

The worker, whose disposable income after housing and travel costs is lower than their northern counterpart?

The businesses, who are paying higher wages for no direct productivity benefit?

The government, who have to spend more on infrastructure to pay for all the mileage being done by people who apparently don't need to live where they work, and are seeing productivity and exports stagnate because the business is running less efficiently than it needs to?

The BTL landlord, who is creaming it from increase revenues due shifting demand, with no increased costs relative to when demand was lower?

Clapton has asked me to put forward suggestions to solve the problem. And the thrust of my solution is that you don't touch the free market directly, but you use the public stock in a way that ensures the private rental sector fills the appropriate gaps.

1. Build enough social houses to cater for those who couldn't possibly afford the market rate (reducing demand in the private sector without directly touching the free market).

2. Means test social housing rent on an annual basis, with no upper cap. Thus those earning enough to survive in the private sector will either move on to free up housing for someone in need, or stay but help subsidize the lack of rent coming from others.

3. Scrap the right to buy outside of London, and replace it with putting a small percentage of rent taken into a savings pot, which is given as a once-only golden handshake to help people with the transition from public to private housing (whether they choose to use that to rent or to buy would depend on their circumstances, how much they had built up, etc, but in practise the amount spent should be comparable to the amount of subsidy in the right to buy scheme - smaller amounts to more people).

4. Impose meaningful levels of enforcement and punishment for financial crimes, and introduce a lifetime ban on social housing for those convicted of fraud above a certain level. Okay, not entirely or even predominantly housing related, but it's part of the big picture. Benefit fraud and tax evasion are rampant in this country, because even when you are caught the punishment generally does not reflect the full benefit of the crime. Ensuring that the right people are in the right homes is a huge part of that.

5. Once all the above is in place, scrap housing benefit altogether. No-one who truly believes in the free market could possibly object to this step, unless of course they directly benefit from it

6. Politely ask those house owners bemoaning the negative effect on their property value to emigrate (but leave them to their own devices if they choose not to).

Numbers 2 and 3 would ease the problems of those moving into social housing being very difficult to move on and the stock being very difficult to replenish. Numbers 1 and 4 would directly affect demand in the private rented sector, without actually touching the market itself. Number 5 is the logical extension of a parallel housing system that is functioning normally (those who can afford rent in the free market, those who can prove that they don't pay what they can in the public sector). Number 6 is because I won't be posting again for at least a day but want to pre-emptively give my love to the usual suspects.

of course, simply building enough houses is sufficient for probably 95% of people needs and so little need for social housing

HappyMJ

HornetSaver wrote: »

The only possible reasons I can imagine for this statement are that you are renting a room within a shared house, you have mistaken "an OO" for "me" (don't worry, a lot of people on this forum mistake "cheap" with "less than what they earn"; this is by comparison a minor mistake), or you are living in a building which has serious structural problems and will need to be demolished within the next decade or so.

It's a 10 year old leasehold flat. I'm not interested in buying it. Hardly anybody is. It's affordable...it's just not worth buying to sell on in 2 years. I wouldn't ever consider buying it at any price.