Thinking of selling up but what about Brexit?

caronoel

Crashy_Time wrote: »

There is a bigger link between rent and wages, and of course housing benefit, it is always amusing when posters say things like "Housing benefit cuts will mean landlords chucking out benefits claimants and getting in professionals who pay more" Human nature dictates that the higher paying professionals would have been first choice if the landlord really could attract that sort of tenant? Of course when rates rise tenants with debts have less disposable income and can therefore pay less rent. It is not a given that a landlord, or "accidental landlord" can raise rents, or even find a tenant, and rising interest rates will affect the whole market as someone said, but the effect will be to lower not raise house prices and rents.

Again, to repost my earlier warning...

Ignore the rantings of Crashy.

He sold up and moved into a rented room in the mid 90s, waiting for the crash that never came.

Now he's single, still renting a little bedsit and in his mid 50s. What a catch for the ladies!

He has almost stopped posting on the Debate house prices board, as they rip his wisdom on house prices to pieces over there.

buggy_boy

Crashy_Time wrote: »

There is a bigger link between rent and wages, and of course housing benefit, it is always amusing when posters say things like "Housing benefit cuts will mean landlords chucking out benefits claimants and getting in professionals who pay more" Human nature dictates that the higher paying professionals would have been first choice if the landlord really could attract that sort of tenant? Of course when rates rise tenants with debts have less disposable income and can therefore pay less rent. It is not a given that a landlord, or "accidental landlord" can raise rents, or even find a tenant, and rising interest rates will affect the whole market as someone said, but the effect will be to lower not raise house prices and rents.

There is a link however when you look over the past 10yrs rents have increased somewhere in the region of 40% on average... I don't know about you but my pay has not increased by that amount.. Also housing benefit has not increase by this amount...

Rising interest rates just like falling interest rates will have a minimal impact, the vast majority of landlords bought years ago so the value of their mortgage has not changed (presuming interest only), so if rates rise to where they were pre 2008 than it goes back to where it was, a lot of landlords don't even have any debt... As stated above rents have increased, its only the small minority that will have bought in the past 5yrs and those that are extremely highly leveraged that will have an issue, how big an effect that is really is difficult to say... Also what the government will do in the future, if they want to stimulate the PRS they now have the means by reducing section 24 effect or reducing the additional SDLT, will this happen, who knows...

I get what you are saying and it makes sense however it does not fit with the statistics or facts and makes a lot of presumptions that are not true. Just like your theory on house price crash which is why you have been wrong for the last 4 yrs+

caronoel

buggy_boy wrote: »

There is a link however when you look over the past 10yrs rents have increased somewhere in the region of 40% on average... I don't know about you but my pay has not increased by that amount.. Also housing benefit has not increase by this amount...

Crashy claims his landlord hasn't put his rent up in ten years.

Pure fantacist

Crashy_Time

buggy_boy wrote: »

There is a link however when you look over the past 10yrs rents have increased somewhere in the region of 40% on average... I don't know about you but my pay has not increased by that amount.. Also housing benefit has not increase by this amount...

Rising interest rates just like falling interest rates will have a minimal impact, the vast majority of landlords bought years ago so the value of their mortgage has not changed (presuming interest only), so if rates rise to where they were pre 2008 than it goes back to where it was, a lot of landlords don't even have any debt... As stated above rents have increased, its only the small minority that will have bought in the past 5yrs and those that are extremely highly leveraged that will have an issue, how big an effect that is really is difficult to say... Also what the government will do in the future, if they want to stimulate the PRS they now have the means by reducing section 24 effect or reducing the additional SDLT, will this happen, who knows...

I get what you are saying and it makes sense however it does not fit with the statistics or facts and makes a lot of presumptions that are not true. Just like your theory on house price crash which is why you have been wrong for the last 4 yrs+

The last ten years have been emergency interest rates, when rates rise tenants (and landlords and everyone else) will pay more for their borrowings, so unless you disagree that people in the UK on average have not insignificant borrowings, then this is going to have an effect on achievable rents in future.

cloo

I don't think Brexit will cause a 'crash' and it's never a good idea to wait for one.

Brexit isn't really a definitive 'moment' when everything will go to hell (it'll go to hell gradually), and things seem to be stagnating rather than heading for a sharp fall, except in the massively oversaturated 'luxury' market in central London.

buggy_boy

Crashy_Time wrote: »

The last ten years have been emergency interest rates, when rates rise tenants (and landlords and everyone else) will pay more for their borrowings, so unless you disagree that people in the UK on average have not insignificant borrowings, then this is going to have an effect on achievable rents in future.

And landlords have gained from a temporary reduction in their mortgage rates, it will eventually go back to normal... I don't see that happening any time soon though, just take a look at headlines a few years after the interest rate was dropped to 0.5% and you will see nobody expected them to last 10yrs... There is still nothing to say that they are going to significantly increase in a short space of time.

When it eventually happens there will be a small number of people that have over stretched themselves that will be in trouble, but that number will be relatively small, in fact section 24 will weed out a lot of those over time anyway... BTL has changed to cash is king, people are still investing but having a lot higher deposit or no borrowing...

Crashy_Time

buggy_boy wrote: »

And landlords have gained from a temporary reduction in their mortgage rates, it will eventually go back to normal... I don't see that happening any time soon though, just take a look at headlines a few years after the interest rate was dropped to 0.5% and you will see nobody expected them to last 10yrs... There is still nothing to say that they are going to significantly increase in a short space of time.

When it eventually happens there will be a small number of people that have over stretched themselves that will be in trouble, but that number will be relatively small, in fact section 24 will weed out a lot of those over time anyway... BTL has changed to cash is king, people are still investing but having a lot higher deposit or no borrowing...

It is happening without interest rate rises, and Trump V China is going to see credit risk/volatility return to the market


As I have said many times, if they had allowed a correction to happen a few years ago the social/political/economic mess would have been a lot less worse.


http://www.propertyindustryeye.com/property-registrations-plummet-by-a-quarter-in-february/

armchaireconomist

Does leaving the European Union mean people no longer need homes?

Crashy_Time

armchaireconomist wrote: »

Does leaving the European Union mean people no longer need homes?

Maybe less homes are needed, see my link above.

jeanzbeanz

Argh, returned to this forum after a year and horrified to see that Crashy Time is still spewing rubbish all over every vaguely relevant thread he can find...! WHAT SORT OF A UNFULFILLING LIFE DOES THIS PERSON LEAD SO THAT THEY FEEL THE NEED TO BE A PROPHET OF DOOM 24/7???

OP, anyone who says they can predict the future is lying to you I personally don't think Brexit will make much (if any) difference to house prices. (and I've put my money where my mouth is, having bought a £710k house and about to borrow £200k to renovate it)
I suggest you do what's best personally for you right now, but in all honesty a house is a pretty safe investment. If you need to generate capital, what about borrowing against your property? Interest rates are so low at the moment!