Falling prices and BTL opportunities

carolt

All right, HammersFan, you've convinced me. I was wrong all along. So how do I go about getting that BTL mortgage then?

Easy money, here we come.....

Generali

HammersFan wrote: »

unless I missed something, we don't have a crash (yet). It looks like interest rates are on the tumble too, with slightly softer asking prices around, this is not a bad time to buy (if the deal is right).

Well that's the joy of investing in any asset - you've got no idea if it'll be the next Amazon or boo.com (remember them?) until afterwards.

My guess is that by April at the latest, the Land Registry will be showing falls in nominal house prices in London and that base rates will be at least 50bps lower than where they are now. I also suspect that real rents acheived will rise over 2008 before falling back quickly in 2009.

silvercar

A million and one overpriced inner city flats not selling will equal half a million inner city flats not renting. Supply and demand, there are too many flats to achieve decent rentals. The money will be in houses. IMHO.

Gorgeous_George

You cannot 'just hand the keys back'. The loan must be repaid and therefore the house needs to be sold. If prices are falling it will be difficult to attain a price high enough to cover the whole debt plus costs. The residual debt still needs repaying and BTLers risk their own homes. It's part of the game.In USA, I believe the debt dies when the keys are returned. This is a significant difference and is why the American housing crisis is such an issue.GG

HammersFan

carolt wrote: »

All right, HammersFan, you've convinced me. I was wrong all along. So how do I go about getting that BTL mortgage then?

Easy money, here we come.....

I detect a hint of irony. Perhaps we coudl discuss again on a new thread in 6 months time? BTL has never been easy money.

HammersFan

Gorgeous_George wrote: »

You cannot 'just hand the keys back'. The loan must be repaid and therefore the house needs to be sold. If prices are falling it will be difficult to attain a price high enough to cover the whole debt plus costs. The residual debt still needs repaying and BTLers risk their own homes. It's part of the game.In USA, I believe the debt dies when the keys are returned. This is a significant difference and is why the American housing crisis is such an issue.GG

That's kind of what I meant (trying to be brief). Only deposits of less than 30% are likely to lead to auction sale not covering residual debt. Desperate landlords can also slash rent. £100 off market rate of £500 would get a tenant like a shot. A £1200 'loss' over the year would be easy to handle for most.

Excellent signature by the way. Me too.

dolce_vita

HammersFan wrote: »

........... Perhaps we coudl discuss again on a new thread in 6 months time? BTL has never been easy money.

Yes, let's do that.

I'll still be around in 6 months.


By the way, there was a time when BTL was easy money.

When houses were cheap and rents were high in comparison.

Now that rent is cheap and house prices are high only a fool would get into it now.

In over 20 years as a landlord I have never, not once, had a situation where the rent wasn't at least 120% of the mortgages.

Over geared, chancer landlords who are subsidising their tenants to pay the mortgage should be sh1tting themselves at the moment.
But they are too stupid to realise what is happening and carry on dreaming about their "pension" increasing in "value" and holding on for "the long term" and buying more when the time is right.

That's fine. If can you can borrow more money and can last the long term.

good luck

DreamBreaker

HugoSP wrote: »

I suppose it's too much to ask you to back this up......

Maybe I'm just not up to this intillectual debate where it seems to be the HPC brigade who just come out and hurl abuse at anyone who's view doesn't coincide with theirs.

Well said!!!! They have been hurling abuse at me for pages of this of this forum and I foolishly bit back! Wish I hadn't as I only lowered myself to their level, but I only did it out of shear frustration that I was not allowed to voice my opinion without receiving a barrage of misquotes and abuse both of my posts and personally!

HugoSP

DreamBreaker wrote: »

Well said!!!! They have been hurling abuse at me for pages of this of this forum and I foolishly bit back! Wish I hadn't as I only lowered myself to their level, but I only did it out of shear frustration that I was not allowed to voice my opinion without receiving a barrage of misquotes and abuse both of my posts and personally!

What you need to remember is that there are those who come and discuss a different view well, and fair play to them.

Then there are those who come and post such quotes as:

You were obviously not "around" during the last crash and have just heard stories of people "handing their keys back".

The only people that did that were the stupid and the desperate.

....or

Because, like your HPI cheerleading posts, it is nothing more than rehashed VI sh1te and wishful thinking with no grounding in economic reality.

....or here's a brilliant one, that is sure to win any arguement though the posters fear of being involved in a discussion that will show up his complete lack of communcation abilities.......

Yet another poster with no idea of economic cycles who is about to learn a lesson in how things work in reality.

...tbh I'm not sure how that torpedoes the point that was made just before it.

The fact is I may be wrong and wideboy may turn out to be right - we shall see. He may turn out to the brilliant entrepreneur that he thinks he is - but it won't be his intellect or communication skills that get him there - or maybe as he has just sold his btl and repaid the mortgage, he's desparately hoping that prices do crash and we enter into a recession - just so that he's not lost a load of money that he could otherwise have made.

It has not gone without notice that his posts have become more agressive and pointless when interest rates have been cut, more money is pumped into the banking system and other efforts are being made to strenthen the economy, making a house price crash less likely.

Perhaps his relief in getting shot of his btl has turned into some sort of sick pleasure in the prospect of other people hitting hard times. It certainly can't make for pleasurable reading for those who have lost serious money before - people who I genually have no axe to grind with, and would gladly see helped in anyway possible. After all they all have one thing in common - they want to make a better life for themselves and those close to them. I personally see no pleasure in seeing families, sometimes with young children put out on the street, because someone has made a bad financial decision, or been badly advised. It seems that Wideboy does.

You've seen his quotes, draw your own conclusions, after all what other purpose to they serve?

Others here who do disagree with my views, and there are several - such as carolt, who do try to construct some counter arguement. It's not up to me to pass judgement on whether they are any good, but I can at least do the courtesy to have a constructive view.

Generalti is another gent who, whilst would love to get on the housing ladder, puts his points well, and raises several valid points that had not been raised before, even suggesting that a house price crash may not even help those who want to get on the ladder as it could lead to recession.

There are several of the House Price Crashers who make valid points, some I had not thought of before, but I can look at their argements and weigh them up - I enjoy that.

This is not a pop at the likes of Wideboy etc but it does beg the question - what is the point in writing the crap that they write? Whilst it may serve to wind people up in the short term, the long term effects are that these quotes tend to backfire on the people that write them in terms of loss of dignity. This concept is beyond some people.

DreamBreaker

HugoSP wrote: »

What you need to remember is that there are those who come and discuss a different view well, and fair play to them.

Then there are those who come and post such quotes as:



....or




....or here's a brilliant one, that is sure to win any arguement though the posters fear of being involved in a discussion that will show up his complete lack of communcation abilities.......



...tbh I'm not sure how that torpedoes the point that was made just before it.

The fact is I may be wrong and wideboy may turn out to be right - we shall see. He may turn out to the brilliant entrepreneur that he thinks he is - but it won't be his intellect or communication skills that get him there - or maybe as he has just sold his btl and repaid the mortgage, he's desparately hoping that prices do crash and we enter into a recession - just so that he's not lost a load of money that he could otherwise have made.

It has not gone without notice that his posts have become more agressive and pointless when interest rates have been cut, more money is pumped into the banking system and other efforts are being made to strenthen the economy, making a house price crash less likely.

Perhaps his relief in getting shot of his btl has turned into some sort of sick pleasure in the prospect of other people hitting hard times. It certainly can't make for pleasurable reading for those who have lost serious money before - people who I genually have no axe to grind with, and would gladly see helped in anyway possible. After all they all have one thing in common - they want to make a better life for themselves and those close to them. I personally see no pleasure in seeing families, sometimes with young children put out on the street, because someone has made a bad financial decision, or been badly advised. It seems that Wideboy does.

You've seen his quotes, draw your own conclusions, after all what other purpose to they serve?

Others here who do disagree with my views, and there are several - such as carolt, who do try to construct some counter arguement. It's not up to me to pass judgement on whether they are any good, but I can at least do the courtesy to have a constructive view.

Generalti is another gent who, whilst would love to get on the housing ladder, puts his points well, and raises several valid points that had not been raised before, even suggesting that a house price crash may not even help those who want to get on the ladder as it could lead to recession.

There are several of the House Price Crashers who make valid points, some I had not thought of before, but I can look at their argements and weigh them up - I enjoy that.

This is not a pop at the likes of Wideboy etc but it does beg the question - what is the point in writing the crap that they write? Whilst it may serve to wind people up in the short term, the long term effects are that these quotes tend to backfire on the people that write them in terms of loss of dignity. This concept is beyond some people.

Well said once again, perhaps we can all now get back to the original point of this forum and even if we disagree at least attempt to understand each others view points