to be annoyed about investment properties when so many people have no home?

[horlickslover]

So many established people beginning to "invest" in property again these days. Buying up ideal family homes and first time buyer homes to rent out or use incresingly (depending on area) for airbnb lets. I have to say it really annoys me. I know a few people looking around to buy second or even third homes as an investment. We have a house that is our home I just think it is a bit greedy to go and buy up available housing like that when so many people just can outbid wealthier people looking to turn property into an income. It would be totally fine if their wasn't the housing shortage there is but as it stands I think it is pretty greedy, selfish behaviour.

If you could do that then would be in agreement that it would be amazing. Always a common ground somewhere

I'm happy renting, I just wish there were more 4-5 bed rental properties. Loads of 1-2 beds a good handful of 3 but few 4-5 unfurnished long term lets.

I know this doesn't match property portfolios a large property may not be a good buy to let investment. What annoys me are the empty houses here either owned by family unwilling to sell as it was once a family home but know no one has any interest living there so they just sit empty or the holiday homes and holidays lets that are empty a good portion of the year I would love these to be offered to families looking to rent.

We live in Scotland and I don't think we have rent controls. I do feel north of the central belt there is a lack of family rental properties.

Talkin is right re ongoing land/property tax.

The government is trying to reduce BTL without causing a pricing crash, by gradual measures.

I think redecoration at the tenant's cost with the agreement of the landlord, not to be unreasonably withheld, would be good.

So pale blue instead of pale green walls ok, fuchsia pink not allowed...

Yonic
The trouble is that they have missed the boat on offshore property ownership
Look up where you live on this map
www.private-eye.co.uk/registry
And see how much of the UK has been removed from the market for every by those avoiding / evading tax.

The UK is the only country that has such lax property ownership laws : and its causing many of the current problems.

Interesting to see that some of the buy-to-letters on here assume that the rest of us would do the same if we could afford it. That's a lot of assumptions to make about someone: firstly that we can't afford it, but also that we have the same principles but less money!

I am particularly unimpressed by an (ex) friend who moaned about how unfair it was that she had to rent privately to live where she wanted and made herself voluntarily homeless so she could get a council place. She bought the council place for £70k five years ago and has now sold it for double that, has bought a new place on a buy to let mortgage and moved in with her man and is renting it out privately. Hypocracy like that takes the biscuit.

It's also wrong to equate home ownership and hard saving, though. Property market success is largely a matter of (a) timing and (b) location.

I saved since my early teens, never had student debt, went travelling or anything. That wouldn't have made a blind bit of difference to my ability to afford a house in commuting distance of my work if i was a FTB today rather than 10 years ago, pre-Lehman.

But Yonic, when we bought the market in the SE was too high for us to afford it so we bought somewhere else commutable to another large city and rented it out and rented in the SE. When we sold it we were able to afford a deposit on something larger. Lots of stupid friends laughed at us buying a house up north and renting something small in SE whilst they, like lots of young professional graduates in London, spent lots on going out and having fun and renting large party flats where they could hold cool parties. 5yrs later they were all still renting but now the market was running away from them and we were the only ones with a deposit.

It's also wrong to equate home ownership and hard saving, though.

I really don't think so - you may not be able to buy very centrally, but even if you work in London you might, with some saving over time, buy (for example) a flat in some parts of Kent - 45min-1 hour on the train. It's not ideal but it's a foot on a ladder.

I didn't love my long commute (who does?) but it's a necessary compromise for some.

But come on folks should we have to make sacrifices, be shrewd and entrepreneurial etc etc just to get an affordable home, a basic necessity?

Sure if you want to be an a captain of industry or a professional sports person you'll need to 'work hard and smart'.

Imo a decent home should be affordable for the average Joe with a basic job??

"When we sold it we were able to afford a deposit on something larger"

Sure, but it wasn't your hard work that made the house worth more in the meantime, although you may have done some sprucing up which no doubt helped a little. It was the rise in the property market.

That's my point about timing, right there.

I benefitted too, don't get me wrong. I could've been earlier but I wasn't too late.

The average salary in the UK is £26,500; monthly take home from this is £1,759.

On £26,500 I can borrow about £93k, according to mortgage affordability and assuming I spend £400 pcm on the train to commute, don't have any tube to pay and spend £150 pcm on food, toiletries and all bills.

If I've managed to save £9k, somehow, and the market hasn't gone up in the time it's taken me to save that, then there are a couple of one bedroom places in, say, Gravesend, that I can buy.

But of course, many people work hard, save as hard as they can, and earn well below the average salary, especially if they are less than ten years into their working lives, probably the time that most people want to own before they start a family.

Yes, there might be two salaries etc but do you see how the credit squeeze has changed the balance?

We had a leaflet sent to us by an estate agent who is actively marketing Dorset as a haven for second home owners from London which is killing our villages in the area. Our village shop now only opens from March until November to provide for the holiday makers and second home owners.

Nice link, talkinpeace.
Again agree completely.
Also agree with Yonic that lucky market timing has more to do with property success than shrewdness in most cases.

And if I wanted to buy in the north then rent in the south, i would need a larger % deposit now for BTL.

Yonic, it's a personal decision, but faced with the circs and figures you described (and during the credit squeeze - 3 years ago), my approach was to up my income a bit through extra hours/weekend work and buy a place of my own. I felt that, with the market rising (and rising and rising), it was important to get a foot on the ladder.

I also went out of my way to buy something unloved (it had been on the market about ten months when I came along - in London). It had been tenanted before and I had to bribe various friends with beer and pizza to help me paint .

Obviously "unloved property" also ='d good discount!

A friend of mine had minlmal funds to buy a place ten years ago. He used the internet to calculate the cheapest area of the UK with the greatest potential for uplift. He spent £20,000 on a very ordinary house in an ex-mining village. He and his wife spent every weekend working on the house, decorating it and so on, whilst holding down a full-time job. They lived here for three years, not doing anything except eating, sleeping, and working. After three years it was worth more. As he had calculated. Combination of market rise and sweat equity.

The point is, he didn't really want to be living there, and he didn't want to be giving up weekends for this, but he did, because there was no other way for his to buy a home. You can still get cheap houses up there so other people could do the same. But most of us get attached to areas and that holds us back financially.

Two bed semi for £44,950

I'll be honest. I'm a landlord, and whilst I am a decent landlord I do struggle a bit with the ethics of it. I feel that the answer to this is higher tax, including capital gains tax on second properties. You cannot expect people not to make sensible choices with their investments; so there has to be a disincentive put into the tax system. If I knew I couldn't make much of a capital gain from eventually selling investment properties, then I wouldn't have bothered to BTL in the first place. The profit from renting is fairly poor, it's the long term capital growth that is attractive to me as an investor. But tax on rental profit could equally be manipulated by the government if necessary. It's not rocket science.

Did you earn the national average wage in your day job? Or better?

I'm not denying that timing plays a part. But all those people who thought we were silly to buy in the north and 5yrs later we at least had made some equity whereas they were all still renting. So they couldn't afford to buy in the south do didn't buy. Whereas we looked at how else we could get on the ladder. They assumed they'd get on at some point and we worried we'd never get on so spent ages researching where else we could buy. We also drove up and down most weekends and spent all our spare money on it.
I also think in terms of luck; dh and I met whilst at university. I grew up in poverty, daughter of a miner. Dh had it harder as he was properly poor, hungry poor. We sort of bonded over a conversation about our almost pathological craving never to be in that position again not for our children to face that. So in our case, it was luck that we were both bright enough, him exceptionally so, to escape that cycle.

We're not in the UK but we have some investment properties, I don't have a moral issue with it, we treat our tenants very well. Our money will go to our DS (not for a while yet, he's still a toddler ) so I will do everything I can to make the most of it for him, isn't that what everyone does, try to do the best you can?
Everyone's moral code is different, it would be boring if we were all the same.

Yonic, I earned £25,500 p/a (so just shy of the figure you quoted), which I supplemented by overtime in my paralegal job, and towards the end also tutoring / proofing work for students on the weekends (extra £100 per week).

Rent was £400p/m - London, 'orrible flatshare.
Tube - £120p/m
Food + treats/trips - £300 p/m

It wasn't easy/sociable at times, but it was bearable to reach a goal.

That's great, Londonista; as you did that for 4 years, I would guess that, particularly with the additional work, you were over the average salary at the time.

Because of the skewing effect of the highest salaries, more than half of the UK were earning less than you at the time. No matter what overtime they did, they couldn't have done what you did.

Again, this isn't personal to you. It needs to always be acknowledged that for a vast chunk of the population, home ownership hasn't been affordable whatever they do for many years, made worse in the credit squeeze and now worse again by the introduction of 'affordability' assessments, not the simple salary multiples of old.