A demonstration of ludicrous house prices...

santashelper_2

surely the price is irrelevant the purpose who owns it may have put down a large deposit so they can afford the rental at this price.

lieutenant_dan

I think rentals are already exorbitant, and maybe at a ceiling too, I don't think there'd be a market at much higher than the current levels as people generally simply couldn't afford it.

What happens then, I don't know. People need somewhere to live, but if they don't earn enough to even rent a bog standard place, where do they go from there?

And these high rentals are in some cases around a third of the mortgage repayments? This situation would be really funny if it didn't affect so many in different ways.

m00m00

it's likely that the people who own it, paid a fraction of the current price and the rental therefore is a decent yield.

no one in their right mind would buy this property as a BTL investment, so the rental return to the value of the property doesn't matter

tr3mor

m00m00 wrote: »

it's likely that the people who own it, paid a fraction of the current price and the rental therefore is a decent yield.

no one in their right mind would buy this property as a BTL investment, so the rental return to the value of the property doesn't matter

It does matter though.

Anyone who would like to live in this house has a choice of paying £900 a month or £2000 a month.

Which would you choose?

free4440273

When I read the thread title, I had visions of us with placards outside Trafalgar Square: "No more ludicrous house price increases":rotfl:

More seriously: that IS ludicrously over-priced.

A_Nice_Englishman

santashelper wrote: »

surely the price is irrelevant the purpose who owns it may have put down a large deposit so they can afford the rental at this price.

m00m00 wrote: »

it's likely that the people who own it, paid a fraction of the current price and the rental therefore is a decent yield.

no one in their right mind would buy this property as a BTL investment, so the rental return to the value of the property doesn't matter

But if they sold it for £340K and put the money in the bank at, say, 6% they would get £1700 a month - nearly twice the rental income.

macaque_2

tr3mor wrote: »

Whist poking around Rightmove I came across a house in my village that is both for sale and to let.

Sale Price: £339,950

Rental PCM: £895

A perfect example of how overpriced houses are.

Nice find. I think the background to this is that most of the BTLs in the market today have mastered addition and subtraction but percentages blow their minds.

macaque_2

m00m00 wrote: »

it's likely that the people who own it, paid a fraction of the current price and the rental therefore is a decent yield.

no one in their right mind would buy this property as a BTL investment, so the rental return to the value of the property doesn't matter

A yield of less than 3% (after costs) is not decent. It doesn't matter how much they paid for it. If they sold it and put the money into an alternative investment, they could earn better than 5%.

Zebedee69

tr3mor wrote: »

Go tell that to Running Horse with his "when I were a lad" lark.

I just did on the other thread.... Got carried away though:o

kunekune

We are paying £675 a month for a 4 bedroom very-swish new build that was listed for sale at £220,000. The builders on the site (still working on other houses) said they were gobsmacked when they saw it advertised. We reckon we have a bargain.