50% off is so last week

Trollfever

Sorry if already posted, but comments on the BM auction are here:

http://www.thisislondon.co.uk/news/article-23499416-details/Hammered:+What+it+is+like+to+see+your+buy-to-let+nest-egg+being+sold+off+for+less+than+half+you+paid+for+it/article.do

Generali

The FT had a short commentary on their site yesterday too.

m00m00

and to finally bring this thread to a close

the property has now sold

for 48k

a 77k capital loss in under 3 years.

so approx 500 a week loss.

that's not taking into account interest payments etc either.

epz_2

will there not come a point when the prices these places fetch will be low enough to make farming dole check tenants profitable. it would mean they become the new council estates with the risk transfered to the private sector but thats not really a bad thing.

only issues are the potential probs with crud build quality and the high council tax bands a lot of these places have being a disincentive to any regular tenants

John_Pierpoint

epz wrote: »

will there not come a point when the prices these places fetch will be low enough to make farming dole check tenants profitable. it would mean they become the new council estates with the risk transfered to the private sector but thats not really a bad thing.

only issues are the potential probs with crud build quality and the high council tax bands a lot of these places have being a disincentive to any regular tenants

There is another problem with Radford (and England's worst police force):
Even with a steel front door and bars on the windows, you would not feel safe.
So even if you paid me, I would not agree to live in Radford, especially on a "dole farming" estate.

space_rider

But if you are fine with living in Radford then 48,000 is a decent price. Just think how small the mortgage would be! I can`t understand for the life of me why someone bought it for £125,000 in the first place. Guess probably someone who was lured by someone at one of those property seminars.

melancholly

there are some other 'local' issues in Nott that will have contributed as well to make it worse - a fair number of students used to live in Radford (amongst other areas) but in the last 3/4 years a whole load more halls of residence have been built (for Nottingham and for Trent). this has to have had a big impact on the number of people prepared to rent, especially in the not so nice areas.

epz_2

John_Pierpoint wrote: »

There is another problem with Radford (and England's worst police force):
Even with a steel front door and bars on the windows, you would not feel safe.
So even if you paid me, I would not agree to live in Radford, especially on a "dole farming" estate.

yeah i wasnt suggesting anyone actually able to buy the place would want to live there, just that the economics of a 48k investment could make it practical for a BTL relying on housing benefit tenants.

48k@6.5% is £327.92 repayment and £260 IO, obviously there are going to be other expenses and likely a load of hassle but it could make financial sense.

i still cant really see anyone grabbing places like this for such purposes for a couple of years. they could well become unsellable at damn near any price, even pre bust you could still find high rise flats up for 22k in glasgow occasionally.

LisbonLaura

space_rider wrote: »

But if you are fine with living in Radford then 48,000 is a decent price.

I disagree. It is still too high a price if you take into account the coming financial storm & the inevitable social decline of the UK................but it's a load better than £120,000..............Don't those prices look like fantasy now; -- & the correction is only in its early days

Generali

The thing is, if you can buy a place for £60/week and rent it for £120/week then who cares what happens to the value of the place? You look at it as buying an income stream and never selling.