New taxes on BTLs - hill of beans?

tim123456789

cashbackproblems wrote: »

, prices are predicted to keep falling as is happening now and brexit could accelerate this. Anyone buying over the next 12 months is silly and those selling should do so before the poop hits th fan

I hope you are right


but (as someone who wants, but doesn't need, to trade up)


I fear you are wrong


tim

Crashy_Time

tim123456789 wrote: »

but it's not a huge profit


When I did it, I (foolishly) self managed and after costs got about 3K per year in taxable income but spent an awful lot of time looking after it.


I calculated I could earn just as much, with less aggro, working the same extra hours as overtime in my day job.


And then I made a 40K capital gain when I sold up.


The profit's all in the capital gain that you make, not the year on year income.


And, like I previously said, despite people cautioning otherwise (OK perhaps I did go back a few years too many) there appears to be no end to this upward trend in market prices.


I don't like the way that, seemingly deliberate, restrictions in availability are causing this never ending increase in prices, but intervention to cause reductions is political toxic

Why are we discussing government intervention to force BTL`ers to sell up on this thread then?

tim123456789

PeterPanic wrote: »

So on a £250K property with a £1k a month rental

That's a pretty poor return


my 160K property will rent for 800pm

tim123456789

jdw2000 wrote: »

£1000 pm in rental income, and £350pm in mortgage costs is a better margin than I was running my own BTL on for many years.

but that was before you had to pay 10 grand Stamp Duty to buy the place

jdw2000

AnotherJoe wrote: »

Its more than £350 because there also the extra £75k residential mortgage shes got. Thats maybe another £150 month. Tax would be another £1,000/year or £80/month. So its now up to £600/month.

The £400 left over from the £1,000 can start paying off the £10k SDLT.

The primary reason for this BTL, like most landlords, is the sale at the end. The annual rent is not intended to be a business by itself. It's a means to an end until such a time as the property is sold.

tim123456789

Crashy_Time wrote: »

[/B]


Why are we discussing government intervention to force BTL`ers to sell up on this thread then?

I don't think that is the intention


(and if it is, it's going to have little effect, on its own, on decreasing overall prices - slightly smaller increases perhaps)


tim

getmore4less

jdw2000 wrote: »

The primary reason for this BTL, like most landlords, is the sale at the end. The annual rent is not intended to be a business by itself. It's a means to an end until such a time as the property is sold.

back in the day when landlord ran it as business and borrowing was not as cheap they would not touch a property without at least a 10% gross yield.

if the net yields dropped due to costs they would look for opportunities to churn the duff ones in their portfolio into better yielders also realizing a few gains along the way to avoid a massive exit CGT bill. the portfolioes gave a divers income stream riding the peaks and troughs was a doddle they would earn their keep and bring in a steady income with the odd bit of capital along the way.

The one property strategy with low yields high gearing is one bill/void away from cash flow crisis.

Crashy_Time

tim123456789 wrote: »

I don't think that is the intention


(and if it is, it's going to have little effect, on its own, on decreasing overall prices - slightly smaller increases perhaps)


tim

What do you think is the intention?

AnotherJoe

Crashy_Time wrote: »

[/B]


Why are we discussing government intervention to force BTL`ers to sell up on this thread then?

Because discouraging LLs is not the same as reducing house prices, however much you'd like it to be.

tim123456789

Crashy_Time wrote: »

What do you think is the intention?

to stop even more piling in