RICS: worst set of figures since records began

WTF?_2

pickles110564 wrote: »

Not quite yet but it will be great, cant wait to be able to offer loads more of quality rental stock to those for unfortunate souls.

It's great to hear that you're so well capitalised and not up to your neck in debt on existing property, unlike many less savvy would-be BTL magnates

teabelly

It doesn't matter if house prices crash or not. If lenders ain't lending then you still can't buy diddly. If the BTL empire collapse does occur then it will lead to less choice of rental properties as landlords are forced to sell. Imagine the economic mess if thousands of repossessed houses appear, no one can buy so they hang around. Those that get repossessed could remain in limbo for years while their debt mounts up. Banks will be losing billions so expect the cost of current accounts and all financial services to rise so you will be paying them fortunes to use your money to cover the losses on what you wished for.

People with spotless credit histories and reasonable deposits are being turned down for mortgages as banks just aren't lending so don't even expect that you will be able to buy even when you do wait for this mythical right time.

You renters might think you'll be laughing but remember the BTL boom has brought about serious improvements in the quality and choice of rented property. If money gets tighter for landlords they won't be keeping your home in good repair or being nice about rent increases, they'll screw you for every penny they can and if you can't find anywhere else or buy then you'll have to lump it. If you want to return to the days where nearly every place was a damp infested hole then keep wishing for a massive crash.

Anyone with half an ounce of sense will come to the conclusion the best thing for everyone is stagnation for a number of years and reasonable lending levels so everyone can sort themselves out. Wages can catch up, banks will get back to reasonable lending so that those with decent deposits and good records can buy and those that don't will have to sort themselves out before they do buy.

If the rental market does shrink then renters with poor credit histories will be the first to suffer as only dodgy landlords will take them on. BTL has become more of a business to survive in these difficult times so expect the amateurs to fall by the wayside and the professional large property owners to be the only ones to rent from. They'll only be interested in their bottom line and if they own a large proportion of property in a particular area then they will have greater ability in setting rental levels. In future I think landlords will be a lot less inclined to subsidise rent over their costs so expect rents to rise higher to cover the loss of capital growth.

carolt

teabelly wrote: »

It doesn't matter if house prices crash or not. If lenders ain't lending then you still can't buy diddly. If the BTL empire collapse does occur then it will lead to less choice of rental properties as landlords are forced to sell. Imagine the economic mess if thousands of repossessed houses appear, no one can buy so they hang around. Those that get repossessed could remain in limbo for years while their debt mounts up. Banks will be losing billions so expect the cost of current accounts and all financial services to rise so you will be paying them fortunes to use your money to cover the losses on what you wished for.

People with spotless credit histories and reasonable deposits are being turned down for mortgages as banks just aren't lending so don't even expect that you will be able to buy even when you do wait for this mythical right time.

You renters might think you'll be laughing but remember the BTL boom has brought about serious improvements in the quality and choice of rented property. If money gets tighter for landlords they won't be keeping your home in good repair or being nice about rent increases, they'll screw you for every penny they can and if you can't find anywhere else or buy then you'll have to lump it. If you want to return to the days where nearly every place was a damp infested hole then keep wishing for a massive crash.

Anyone with half an ounce of sense will come to the conclusion the best thing for everyone is stagnation for a number of years and reasonable lending levels so everyone can sort themselves out. Wages can catch up, banks will get back to reasonable lending so that those with decent deposits and good records can buy and those that don't will have to sort themselves out before they do buy.

If the rental market does shrink then renters with poor credit histories will be the first to suffer as only dodgy landlords will take them on. BTL has become more of a business to survive in these difficult times so expect the amateurs to fall by the wayside and the professional large property owners to be the only ones to rent from. They'll only be interested in their bottom line and if they own a large proportion of property in a particular area then they will have greater ability in setting rental levels. In future I think landlords will be a lot less inclined to subsidise rent over their costs so expect rents to rise higher to cover the loss of capital growth.

:rotfl::rotfl::rotfl:

In your dreams...

teabelly

BTL is a business. Do you renters honestly think you are immune to increased costs of housing? Do you not expect that you have to pay enough rent to cover the outgoings on a property? Where else would you expect to continually pay less for a service than it costs to provide it? If rents don't cover the current mortgages + costs then rents will rise. Landlords tended to put up with this as they knew they'd have capital growth to enjoy. Now they think that is gone do you honestly think they are going to carry on making a loss indefinitely just to keep a roof over your head?

They will either cut their losses and sell ( you then have to move) or they'll raise the rent so it makes financial sense so you can either move to somewhere cheaper gambling on the fact your new landlord won't do the same so you'll have to move again or you can pay the new rent.

brit1234

teabelly wrote: »

Anyone with half an ounce of sense will come to the conclusion the best thing for everyone is stagnation for a number of years and reasonable lending levels so everyone can sort themselves out. Wages can catch up, banks will get back to reasonable lending so that those with decent deposits and good records can buy and those that don't will have to sort themselves out before they do buy.

Sorry it doesn't make sense to me as a first time buyer. If prices stagnated then it would take years for wages to catch up. It is clearly best to allow this big fall and start again from a stable base.

Why should we protect buy to let investors at the expense of first time buyers and young families?:mad:

Generali

teabelly wrote: »

BTL is a business. Do you renters honestly think you are immune to increased costs of housing? Do you not expect that you have to pay enough rent to cover the outgoings on a property? Where else would you expect to continually pay less for a service than it costs to provide it? If rents don't cover the current mortgages + costs then rents will rise. Landlords tended to put up with this as they knew they'd have capital growth to enjoy. Now they think that is gone do you honestly think they are going to carry on making a loss indefinitely just to keep a roof over your head?

They will either cut their losses and sell ( you then have to move) or they'll raise the rent so it makes financial sense so you can either move to somewhere cheaper gambling on the fact your new landlord won't do the same so you'll have to move again or you can pay the new rent.

Are you trying to suggest that LLs have the pricing power to be price setters rather than price takers?

That's certainly not the case in my area where there is plenty of supply of rented properties (Kent commuterland) - if LLs try to charge higher rents they have to look for new tenants. Annectdotally, there are many empty houses round here with 'To Let' signs outside.

EdInvestor

http://www.guardian.co.uk/money/2008/may/13/houseprices.mortgages

Shortage of stock is limiting price falls.

.. the RICS said that so far the scale of price falls remained small compared with previous downturns. The RICS said that in 10 out of 12 UK regions, falls were concentrated in the 0 to 2% range, although in the south-east and East Anglia there were more declines in the 2% to 5% bracket. In London 18% of surveyors said prices were unchanged over the quarter and 41% said they had fallen by up to 2%.
Ian Perry of the RICS said: "Although most surveyors are now seeing price declines, the extent of the fall is, at this stage, quite modest...Some RICS members blamed the media for the price falls. "There is no crash, but the media is causing one," said Richard Sayer, of Rook Matthews Sayer in Alnwick, Northumberland.

... or rather trying to.But people are not stupid. Why would you put your house on the market at the moment when you know many people can't get a mortgage and the likelihood is the chain will fall through? Better to remortgage and build that extension/loft conversion.How many times do deals have to fall through before people get fed up and turn to the thriving rental market?

We will end up with a market in deep freeze, consisting of a few decent properties which will hold their value and a load of rubbish old stock which will either sit there forever unsold or provide a "bargain" for the likes of people who post on this forum.

This type of market won't cause a crash.The big losers will be the EAs and the mortgage brokers.

WTF?_2

Generali wrote: »

Are you trying to suggest that LLs have the pricing power to be price setters rather than price takers?

That's certainly not the case in my area where there is plenty of supply of rented properties (Kent commuterland) - if LLs try to charge higher rents they have to look for new tenants. Annectdotally, there are many empty houses round here with 'To Let' signs outside.

Yep - locally I'm seeing lots of "To Let" signs spring up as owners find that they can't sell but need some sort of income to fund outstanding debt. Many are houses that were bought by speculators to 'flip' or houses that were awaiting sale following the owners trading up.

Thing is, as the economic situation deteriorates I suspect many such houses will start to be repossessed. That will remove them from the rentals market for a period of months so the situation could reverse. I also expect lots of recent BTLs to find themselves in trouble and being repossessed - leaving their tenants in a tricky position and boosting demand as rental stock falls.

It would be great if rental costs decline in the medium term though. It will mean I can save even more and have a wider choice of rental properties as I wait over the next 2-3 years for the right moment to buy into the housing market.

Pennywise

Look on the bright side. The RICS report for March might be the worst at the moment, but in another few months, it will look positively excellent. This is when we've had even worse RICS reports for April, May, June, July, etc.

However much "wishful thinking" there is around, the house price crash is only just starting. It was a bubble hyped up by the Govt, EAs, BTLers and builders - there was never anything substantial supporting it. In economic history there has never been a "soft landing" - it's just boom and bust. The higher that inflation rises, together with tax rises, and the general "feel bad" about the economy, the HPC will get worse and worse.

WTF?_2

EdInvestor wrote: »

http://www.guardian.co.uk/money/2008/may/13/houseprices.mortgages

Shortage of stock is limiting price falls.


... or rather trying to.But people are not stupid. Why would you put your house on the market at the moment when you know many people can't get a mortgage and the likelihood is the chain will fall through? Better to remortgage and build that extension/loft conversion.How many times do deals have to fall through before people get fed up and turn to the thriving rental market?

We will end up with a market in deep freeze, consisting of a few decent properties which will hold their value and a load of rubbish old stock which will either sit there forever unsold or provide a "bargain" for the likes of people who post on this forum.

This type of market won't cause a crash.The big losers will be the EAs and the mortgage brokers.

Under what circumstances, exactly, could there be a crash using your rose-tinted view of the housing market? :rotfl:

Really .. if steadily falling prices, a credit crunch and pessimistic forecasts all around (including the Government's own hitherto confidential forecasts) are all predicting year-on-year falls of around 10% or more by the end of this year alone ... then what pray tell would cause a real fall in the market?

You should get in touch with Caroline Flint and offer your services as a spin doctor - she is going to be needing all the help she can get