To not feel sorry for buy to let landlords

[feellikeahugefailure]

now the tax rules have changed and their borrow to let becomes a huge liability. Isn't that just part of speculating / investing? Sometimes you win, sometimes you loose. Signing up to many decades of debt its hardly unlikely that there are policy changes in that time.

Landlords in 5 star hotel moaning

Here comes another 'class war' thread :)

It's not about class, just about have's and have nots. There is no denying that the rise of BTL is increasing social inequality.

YANBU and I am one (although the tax changes don't bother me particularly). I hate it when people treat buy-to-let as a get rich quick game.

YANBU, I don't feel sorry for them either.

On a serious note, mortgaging yourself up to the bollox is always a MASSIVE risk. Cant say I'm losing any sleep over this particular investment strategy becoming less viable, as it's having a negative effect on the housing market.

That said, one could argue that all this does is make landlording the privilege of only those who are liquid enough to buy outright rather than those who could 'trade' on credit, for want of a better term. Pushing BTL from being viable for the top 10% to the top .1%. Lessens the problem, but lessens the access too.

Just thinking out loud.

feellikeahugefailure

Hence the 'class war' words being in inverted commas - it was tongue in cheek, I assure you.

I feel sorry for the accidental landlords, those who move for work, move abroad, move for family problems etc. Not their fault if the market hasn't returned what they paid as yet, so they rent it out till they can afford to sell.

SquinkiesRule

Shouldn't they be okay, as they shouldnt be on a BTL mortgage? I dont believe normal, first propery mortgages are affected?

If no-one had any btl properties, where would most of the people they rent to live?

Yanbu.
Btl is a business and it's as risky as any other business. Btl has been treated as risk free money trees for far too long and it has contributed to the fuck up that is our housing market

In houses we could afford to buy.

Costa...presumably there would be a glut of houses on the market, prices would drop and people would buy them. We pay more a month in rent that we would do on a mortgage

whoops! sorry LupoLoopy

Costacoffeeplease - 94% of renters in the study quoted in the video want to buy.

We also have 20k saved for a deposit. Buying a house is still a pipe dream for us as prices are too high and we can't borrow that much. DP earns well well over the average wage.

Doesn't it only affect people who are higher rate tax payers?

feellikeahugefailure

No apology necessary. Tone of voice failure on my part.

Th theory is that they'd all be able to buy Costa because the cost of housing would decrease. This may be true in the SE (which obviously is the important thing) but looks like a pile of bollocks if you live in a depressed northern town. Maybe the councils will step in and build loads more council houses for all the students, unemployed adults, those on zero hour contracts, migrant workers etc who can't get/don't want mortgages?

But do they all have the required deposit and able to get a mortgage?

I don't have a btl, I'm just interested in the dynamic

I dont have a problem with btl landlords. I currently live in a house thats a buy to let. Im very grateful that people buy houses to let out otherwise would the hell would i live????

The council is under enormous pressure to house people and there is not enough housing to go round.

Without private landlords a fair proportion of the population would be on the streets as most people cant raise the funds for a house deposit.

If private rent wasn't so inflated then more people would be able to save each month.

Where not would*

PatMullins

Depending on the rent, it's not necessarily 'that' inflated if your landlord is doing their job properly. It's totally plausible to have at least 2 months a year where you make no money or a loss due to repair necessary at the property. One leaking boiler can write off a quarter.

You also have lots of things you have to do on an annual basis for Health & Safety purposes (Legionnaires tests etc) that have a cost. These costs add up.

It's my understanding that you don't make every month in reality. Not if you're actually looking after your tenants properly.

BTL for many is a way of saving for old age. Most pension funds are not risk free. Many like the fact that property has gone up over recent decades in value, also that it can be lived in as opposed to say investment is shares.

If people don't save for old age they will become a burden on the state.

Where I live landlords only seem to rent to professional people with a fairly high income. They also credit check people.

These are people who probably would be able to buy if prices weren't so inflated and the rents were lower so they could save more.

As a PP, I'm only thinking out loud so not saying I'm correct but I do think BTL creates a lot of problems.

Although I'm not arguing whether a reduction in the number of BTL is a good thing/bad thing. I think it'll likely have mixed results. It'll be a good thing for London and could be awful elsewhere (as others have stated). That said, the current state of affairs is pretty awful, so tweaking things has got to be worth a shot.

Just saying that sometimes the rents look high and the knee-jerk instinctive reaction is to think 'bastards' rather than thinking what costs services and risks are being baked into the rental price