House Prices
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Well they will do all they can to keep prices high, so that'll be extending the stamp duty holiday and giving more tax payers money to people to buy. It's pretty disgusting really, proping up prices rather than trying to fix the broken market. But the average person will see the return of 95% mortgages and tax payers subsiding it as good
.The only people that win are those selling financial products. The average person being saddled up with evermore debt to buy an inflated essential is terrible. But that's the world we live in.
I do wonder how much affect the latest intervention in the market will have. Of course they would never let it come to a cliff edge. But I expect most that wanted to move have by now and once furlough ends jobs will be lost (even those thought to be safe as things filter down).
More house price inflation because people feel richer when their asset goes up in value and the economy is based on selling ever higher house prices to each other like a ponzi scheme.
The market where I am up north (nice area in a big city) is still absolute nonsense tbh - we’ve now lost out on countless houses which have been sold for well over the price they’ve been valued at (talking 20k-50k). It’s completely unsustainable but also means there must be loads of people in negative equity and/or willing to pay the shortfall in cash? I mean in some situations it may be worth it but this has literally now happened to us six times in the last six months and I’m sure it’s not just happening round here.
You may find it’s the people who have lived in the South moving North, so they have more money from sales of property etc available to them....
Yeah I’ve no doubt that this is part of the issue! Personally, even if I were in a position where I was mortgage free I’d still not want to be in negative equity though but clearly there are some people who don’t mind...
But they likely won’t be in negative equity if they have a large deposit and a small mortgage....you’re only in negative equity if your mortgage is more than the house is worth....
They will be in trouble when the prices drop and they’ve overpaid. I’m in the north as well and know of so many houses that have gone 40-50k over, it’s ridiculous. I don’t understand some people’s mindsets atm.
If youre mortgage free or small mortgage in a forever home it really doesnt matter if prices drop. Youre going to live there for a long time.
Prices dropping is only going to be an issue if youre mortgaged to the hilt and your mortgage comes up for a renewal, likely your payment might go up. Or you plan to be selling or moving.
In our previous property our neighbour across the road put a double extension on, it was definitely more than the house was worth to do but they liked the area, was there forever home so why not. Once theyve paid off there mortgage its theres and it doesnt really matter.
Obviously unexpected things can crop up which means your forever home isnt no longer but if youve got a small mortgage or mortgage free a drop in prices isnt gonna affect you that badly.
Yes, I’m just talking in a generic way. Most people expect the value of their home to go up over time. Also, those I know who’ve moved don’t have massive deposits and plan on moving again in the future. That’s why I’m shocked they’ve don’t it.
Also, personally I couldn’t pay more than something is worth.
Yes same for me “up north” I live in a nice suburb of a big city, houses have always sold quickly, but now literally everything is sold in days in closed bids way over asking prices.
I cannot cope with house prices in the area I want, I put my flat back on market, 2 offers way under asking price, both declined, but the area I’m looking in currently only has 3 tit houses all needing work done that are 30-40k more expensive then they were last summer! The stress is real
It almost feels criminal what the government are doing.
They let house prices go out of control without intervention. Then intervine like there's no tomorrow to prop them up.
As much as "homeowners" (many of whom I'd call debt holders) celebrate every time house prices rise it's really detrimental to society. It's not something good that house prices bare little relationship to earnings and that people need help from tax payers and/or family to afford one. But so many MPs are into buy to let, with friends in fiance and they're the real winners out of this all.
I do agree although it's a bit like buying a new build that will instantly be worth less as it's not new anymore.
In recent months it's probably the worst time to buy during a frenzy. But with the easy money taps on we're just going to have ever more house price inflation.
@Yel you seem to be really against BTL. You do realise that BTL is the only way for an average person to invest money with a return? There was a direct correlation between banks reducing interest rates on savings accounts and the amount of BTL being purchased. What would you suggest to all these people? To not invest their money? I know plenty of old people for whom their 1-2 BTL is essentially their pension, and without it they would struggle with bills. Do they sell them to not be evil landlords and then have to go and seek help from the government in the form of benefits/housing/food banks?
Well yes because it's borrowing money to speculate and push up the prices of something essential. Lots of it is a ponzi scheme where those that were lucky enough to be born when they were affordable remortgage to stick it back into property.
Er no it isn't.
I'm leaving it there now you're talking about food banks if people weren't allowed to people farm with BTL.
BTL is no longer profitable for an 'average person' without setting up an Ltd. The amount of tenant rights (hurray!) and landlord obligations are slowly making it not lucrative as an investment. Younger generations invest in stocks & shares which bring the similar ROI without the hassle of taking care of tenants/properties. Also, properties are illiquid, not a great investment if you need money quick.
The biggest problem of an 'average person' to be a landlord is that they are mostly unaware of tenant rights/protections and landlords obligations to make properties habitable no matter what costs. When tenants stop paying, they all start crying about loss of income. Unfortunately, that's the law. Government protects people's homes over someone else's investement. That is not a problem with S&S though.
The biggest problem of an 'average person' to be a landlord is that they are mostly unaware of tenant rights/protections and landlords obligations to make properties habitable no matter what costs. When tenants stop paying, they all start crying about loss of income. Unfortunately, that's the law. Government protects people's homes over someone else's investement. That is not a problem with S&S though.
Well, what would your suggestions be for those elderly people? I know them not from just the landlord side, but also from the tenant side - quite a few of our friends rent their homes from elderly landlords.Well yes because it's borrowing money to speculate and push up the prices of something essential. Lots of it is a ponzi scheme where those that were lucky enough to be born when they were affordable remortgage to stick it back into property.
Er no it isn't.
I'm leaving it there now you're talking about food banks if people weren't allowed to people farm with BTL.
There are other situations, when the “landlord” can be in a care home and relies on the undone from renting their home to fund the care. I know a single mom, whose husband passed away. She moved to a small flat with her baby and rents their home to supplement her income. Are all of these scenarios still make the people evil landlords? And what would you do if you were in their shoes? What would they need to invest in to get a semi reliable income straight away without the need to wait for several years? Not everyone has the knowledge, understanding and time to invest in stocks and shares.
To be fair, the scenarios you are describing are not necessarily common. Most elderly people sell their homes to pay for care, for example. The vast majority of landlords are in it by choice, not because it was their only option.
Personally I have a problem with the way our entire property and renting infrastructure is set up. I find it gross that so many people think of BTL as an investment for themselves only, when in reality, your property will be someone’s home. People forget this and the way some tenants are treated is beyond belief.
Let’s be honest, the amount of awful landlords out there far exceeds the number of good ones. Around half of private landlords refuse those on benefits for example, and 44% refuse to rent to non-British passport holders. Private landlords are far less likely to return full deposits to tenants than agencies. The general makeup of private landlords in the UK is 50+ white men who don’t believe in climate change! BTL perpetuates the existing unfair social hierarchy under the guise of personal investment.
In general it’s a very selfish way to make a bit of extra cash. It’s also not the cash cow people seem to think it is. I can see how if you’re desperate and you need that extra bit of money monthly, then it probably suits you. For most people however, investing in stocks, shares, financial products and your own home (if possible to add value) is probably more suitable and more lucrative in the long run.
I work in property management, I deal with landlords on a daily basis and I can say about 80-90% of our landlords are good ones.
In regards to 'Around half of private landlords refuse those on benefits', do you know why? Because many freehold insurance policies don't allow it. This isn't a policy the landlord has any power over it, it is issued by the land owner and they are obligated to pay and follow it. We have one in a block of over 60 flats and the policy states no DSS so what is the landlord expected to do because if they do and there is issue that their fault they are liable.
Can I ask where you got your data regarding white 50+ men being the majority of private landlords? I can say from experience this is not the demographic of most of our landlords and specially most of our 'bad' landlords are of a completely different demographic.
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