UK Affordability still very good

Crashy_Time

economic wrote: »

agree. think it will mroe or less keep in line with inflation. whilst our generation wont have the benefits of property wealth, hopefully we can take advantage of technological advancements.

Why didn`t you buy tech shares instead of putting your money back into the bubble on a bubble?

Crashy_Time

chucknorris wrote: »

It was exceptional growth, although hidden in the figures was that it needed a bit of work. I didn't know my wife back in the 90's, but she tells me that she spent about £40k doing it up. So the real growth is from about £150k, rather than £112k (I just spotted that house on Rightmove and it states that it was bought for £112k (not £110k).

I am probably going to sell my properties a bit slower than I first thought, especially on the higher yielding 3 bed flats, on the best one, I would have to make 7.2% on the NET equity (after CGT) just to financially treadwater, which obviously isn't going to happen. So even with minimal or no growth (even a slight dip) it is better to hang onto property a little longer. I may sell the lower yielding 2 bed flat next tax year, I am unsure, the thing is that my current tenants seem keen to stay and I never hear anything from them. If they happened to give me notice right now though, I would sell it immediately.

EDIT: I'm starting to wonder if I should keep that 3 bed flat and simply pay for the management of it, I've got a few years to muse over that.

Well we can both agree on the selling will be slower than you thought bit.......:rotfl:

chucknorris

Crashy_Time wrote: »

Well we can both agree on the selling will be slower than you thought bit.......:rotfl:

I invested to make money, and actually it surprised me that the equity from the other 3 bed flat has to make 7.5%, so between them I would have to average 7.35% (that is just income not capital gain). It was always was about the income, and I would make approx half that in dividend income. I still would have to sell by the time I am 70 though, to give myself a chance of spending the equity, and also allow for recovery from a possible crash, so it is only about a 6 year delay.

chucknorris

Crashy_Time wrote: »

As I said, we know it isn`t going to be there as it hasn`t completed yet, I was commenting on the general lack of million pound house sales in Hackney this year (that I could find) You house is obviously a bit special?

Not really special, if you look on Rightmove you will find plenty 4 bed period houses in Hackney over £1m. Although it was bought by a developer who we think is going to convert it into 2 or 3 flats, we thought about doing that ourselves, but we just weren't motivated enough to endure the hassle.

chucknorris

Windofchange wrote: »

What line of work were you and your wife in Chuck?

I'm a chartered quantity surveyor by profession, but now work as a university lecturer, my wife retired last December, she was an actuary by profession.

Crashy_Time

chucknorris wrote: »

Not really special, if you look on Rightmove you will find plenty 4 bed period houses in Hackney over £1m. Although it was bought by a developer who we think is going to convert it into 2 or 3 flats, we thought about doing that ourselves, but we just weren't motivated enough to endure the hassle.

I`m talking about actual sales, not sellers fantasy prices.

WengerIn

chucknorris wrote: »

I invested to make money, and actually it surprised me that the equity from the other 3 bed flat has to make 7.5%, so between them I would have to average 7.35% (that is just income not capital gain). It was always was about the income, and I would make approx half that in dividend income. I still would have to sell by the time I am 70 though, to give myself a chance of spending the equity, and also allow for recovery from a possible crash, so it is only about a 6 year delay.

Out of interest have you kept a log of costs? It would be really very interesting to compare total net returns from your landlording with FTSE100/S&P500/UBS Bond Index total returns. No need to post all the figures, just a pair of figures of gross rental returns after interest, fees, taxes and costs and gross capital returns. (Happy to do this off board).

As a non-UK taxpayer I'm starting to think that UK BTL might be a good investment for me. I am tax resident in a place which has some very kind tax laws for BTL and my pension savings are getting to a level where I'm starting to think that a bit more diversification might be in order.

economic

Crashy_Time wrote: »

Why didn`t you buy tech shares instead of putting your money back into the bubble on a bubble?

i did. i just didnt want to put everything i have in shares. i also needed a home to buy. it has benefits you just dont seem to see.

you do realise i dont put all the money i have in property?

GreatApe

Crashy_Time wrote: »

Why didn`t you buy tech shares instead of putting your money back into the bubble on a bubble?

Hindsight investment is easier than foresight investment.

If 5 years ago people knew amazon or google or Facebook would be up 3-5x then that would have been the price 5 years ago.

Going forward I think self drive technology is going to be the next huge wealth creator. The problem right now is that we don't actually know who will be the one to get there first with a compelling effective software solution. Tesla Google Samsung Uber or one of the dozen existing car companies or one of the dozen large car company suppliers or even Intel+mobile-eye. In five-ten years time there will be people like you saying why didn't you invest in company x where x was the one to succeed but right now there are possibly 20 companies that could be x.

economic

GreatApe wrote: »

Hindsight investment is easier than foresight investment.

If 5 years ago people knew amazon or google or Facebook would be up 3-5x then that would have been the price 5 years ago.

Going forward I think self drive technology is going to be the next huge wealth creator. The problem right now is that we don't actually know who will be the one to get there first with a compelling effective software solution. Tesla Google Samsung Uber or one of the dozen existing car companies or one of the dozen large car company suppliers or even Intel+mobile-eye. In five-ten years time there will be people like you saying why didn't you invest in company x where x was the one to succeed but right now there are possibly 20 companies that could be x.

i think the easier (NOT easy) question to answer is which will do better: stocks or property?

over the long run stocks have done better beating property returns. stocks seem to have broken out and entered a bull market in 2013. this means its only been 4 years into the current bull market. everything points to the market going much higher. with property it is very questionable what will happen.