Would this ever happen?

Mr.Generous

Ok firstly as a developer to be able to view un-mortgageble properties you have to provide proof of funds. Personally I blank out the acc number and sort code, but some may not. So yes its possible EA holds bank details.
I know of 1 very wealthy investor who uses a property management agent and basically buys anything he recommends without looking at it, but that is an exception.
Most investors won't pay asking price. Myself and business partner are no exceptions. Why would we when we can put in half a dozen low offers until someone accepts? We offer cash purchase, no survey, complete to sellers timetable. Sooner or later someone accepts. The new stamp duty means we are paying more than a first time buyer, and as said above if you want it as a home its worth a couple of ££ extra to you than it is to us. We don't get into a bidding war. Oh and when we get a property its a run down mess, we do it up and sell it. About 50% go to first time buyers, the remainder split between investors and existing home owners moving. We prefer FTB or investor because of no chain.

Cakeguts

dannyjebb wrote: »

Thinking about it the estate agent holding bank details would be weird, this is what my friend says though.

I'm not sure owning properties should be allowed to be a business if you're affecting other people's chance of buying somewhere to live!

I don't understand people saying that BTL investors won't pay top price..... They are making a handsom amount from renting out if you say 600pcm on a 100k property thats a decent return considering after 10 years you will have nearly earnt back the initial cost and then be able to sell the house at most likely a higher price

Just as a matter of interest where would you suggest all the people who are renting these properties go to live? People assume that someone rents because they can't afford to buy a house but there are lots of reasons as to why people rent. If you think about this carefully what you are also saying is that people who want to rent a house shouldn't be allowed to rent the kind of house that you want to buy because this is what will happen if investors are not allowed to buy these houses.

In any case I really can't believe that ALL the houses that come onto the market in your area are bought by investors offering cash.

You can't expect to buy a house with a mortgage for the same amount as someone offering cash. If you really want a particular house you need to offer more than a cash buyer.

AdrianC

Would this cap apply to all businesses? Even housing associations?

Apodemus

You also need to consider what return is reasonable on any business. In your scenario of £600 pcm on a £100,000 property, that is a gross annual return of 7.2%. That doesn't strike me as a huge return on a business investment (many business decisions would require a much higher return on capital). I've seen US sites suggest a rule of thumb for investing in rental properties that you should not invest unless you can be sure of a rental figure of 1% of the capital value per month. On this measure UK house values are too high (or rental costs too low) to make BTL an attractive proposition.

silvercar

For the many estate agents that also offer rentals, selling to a landlord means that there is a likely gain of another property on their rental books.

iantojones40

dc197 wrote: »

In Soviet Russia, government tell me how many properties I buy, da?

If you want to talk about state intervention in what is supposed to be a free market economy then the soviets have got nothing on our own dear government.

AdrianC

FrodoRodgers wrote: »

I am not sure, but you could try it.

...and don't be afraid if we all laugh and point out the reality.

Brock_and_Roll

dannyjebb wrote: »

After speaking with a friend last night who is an estate agent I wondered if anyone thinks there should be a law limiting the number of properties a person/business can own?

He was telling me he has a few people who have bank details on file and any property that comes up for sale that is suitable for renting then they will pay cash for! So how is a FTB supposed to compete with this? If you're a seller and a cash buyer offers the price you're selling for then it's a no Brainer!

If the govt are serious about helping people get on the ladder then surely they need to look at investors just buying up all the affordable housing?

Interested what others think

A simple look at who the wealthiest landowners are will give you a clue as to why such a limit will never happen short of a full communist revolution:


The Duke of Westminster, The Crown Estate, Cadogan Estate etc

Nobbie1967

The only real answer is to build more houses in the southeast of England to bring supply into line with demand. I think everyone agrees with this until a new estate is proposed near them...

getmore4less

The reason there is a business for people buying property to rent out is there is a demand for rental property.

if you try to restrict the number of rental properties then the rents go up.

what then, cap rents?