Andreas Panayiotou (Buy to let king) sells up & predicts big falls

Doc_N

For anyone still with any lingering doubts about the house price crash that's about to hit the market, just listen to the comments from Andreas Panayiotou on Radio 4's File on Four, repeated on Sunay 30 September at 5pm or available here:

http://www.bbc.co.uk/radio/aod/radio4_aod.shtml?radio4/fileon4

This is a man who's amassed a fortune of several hundred million pounds over the last few years from residential property - but he's now selling up. He says on the programme that he sold £400m property last year, with another £350m to be sold inside the next 18 months. As he says, the rents aren't covering the costs in many cases, and he's getting out before prices fall even further.

http://www.ft.com/cms/s/0/74c5e730-575a-11dc-9a3a-0000779fd2ac.html

This is very clearly a man who knows the market, and if he's selling there will be thousands more who take his lead and get out.

Not a good time for the Buy to Let people - but a fantastic time ahead for youngsters at last able to get into the market and pick up some forced sales at dramatically lower prices.

Gorgeous_George

With all these properties being removed from the market, there'll be even more demand for good quality rental properties.

For every sale, there needs to be a buyer. I wonder where he'll find them all.

GG

Terry_Tibs

Sounds like a RAMP from a man who wants to buy in cheap property.

Doc_N

Gorgeous_George wrote: »

(1) With all these properties being removed from the market, there'll be even more demand for good quality rental properties.

(2) For every sale, there needs to be a buyer. I wonder where he'll find them all.

GG

(1) Not the case, I'm afraid. They aren't going to be removed from the market at all - they're being bought by people who actually want to live in them, and as a result they no longer need to rent.

(2) That's the whole point. There may well not be enough buyers, and since the whole thing depends on supply and demand, prices will fall until there are enough buyers.

franklee

Gorgeous_George wrote: »

With all these properties being removed from the market, there'll be even more demand for good quality rental properties.

That rather assumes the properties are currently occupied. If so those tenants will be given notice and some may stay while the property is up for sale. During the sale period the properties may fall empty but either they will sell to OO's, sell to a new landlord or not sell and be re-let. So I would not expect large numbers of them to be empty for long at the same time.

So overall more churn rather than an absolute property shortage as properties come on and off the market. The numbers of people wanting to occupy would stay broadly the same IMO except some of them will be swapping from tenants to OO's.

Libra1975

Something sounds odd here, according to at least 80% of the posts here about BTL (which I agree isn't scientific evidence) old timer BTL'ers will be fine as they got in the market when prices were low and have done their homework, it's the new chancers that are going to get stung plus in the article:
"Mr Panayiotou said that over the long term investors would still make money. But thousands would be squeezed by the widening gap between yields and borrowing costs."

So it is only those who panic or don't do their homework over what they are about to buy and let out who should be in problems.

It then goes on to say
"He will not be immune if there is a downturn in the UK residential market. He is building 600 flats at Limeharbour in Docklands and 250 at the adjacent Millharbour."

hearts

LOL...........A very clever man indeed! He talks a market DOWN presumably just before he is about to sell.............aye right! ;-)

lapat

if hes putting £750m of proerty on the market in two years he could in eefct intsigate a price rise/crash in the area he is seeling the propertys off

franklee

hearts wrote: »

LOL...........A very clever man indeed! He talks a market DOWN presumably just before he is about to sell.............aye right! ;-)

1. He's already sold over half and could hardly keep £400m worth of sales, sold LAST YEAR, that secret.

2. He probably can't keep it a secret if it's being done through a company with shareholders or whoever that need to be told what's going on.

3. He isn't saying anything that isn't already widely obvious but may gain in reputation by being one of the few saying it openly in time.

A clever man indeed to get in early and at least partially out at the top. I expect he has already made loads anyway. I would not laugh an him or his fortune!

lapat wrote: »

if hes putting £750m of proerty on the market in two years he could in eefct intsigate a price rise/crash in the area he is seeling the propertys off

Yes, bound to cause problems, but that was always going to be an issue with any landlord holding significant amounts of property. Thing is, unlike owner occupiers, investors do not have emotional ties to their properties and so won't hesitate in selling should they think it financially sensible. They will want to get out first and fast before others beat them to it. That's why I think there will be a BTL herd stampede to sell. We've already seen what fear can do to herds with the run on the bank! This BTL phenomena has made the property market very unstable IMO.

CYBERCIDERSAVER

Everyone has an opinion on if and when the market will fall.

Smarter men then him have incorrectly predicted a downturn....

With that much property he can make a killing by selling high and then rebuying cheap.

He's taking a gamble. Although by advertising the fact he may help encourage a fall, after he's sold the bulk of his property!

Quite a clever man methinks.

Doozergirl

Doc_N wrote: »

As he says, the rents aren't covering the costs in many cases, and he's getting out before prices fall even further.

This is very clearly a man who knows the market..

What a genius he must be to buy property where the rent doesn't even match the mortgage repayment. Some people are just chancers through and through.