to think all buy to let people are just in it to get someone else to work to pay off their mortgage?

[madhurjazz]

I wish people would say it as it is. Buy to let in my mind is just about getting someone else that can't afford a deposit / without a stable job to do all the hard work to pay off the mortgage of someone else. It does feel like a massive step backwards in equality.

Very few actually want to rent, the vast majority are stuck doing so as speculation keeps pushing ownership out of reach.

[Pisssssedofff]

Pensions are, I meant typed too fast

[Pisssssedofff]

Pensions is the problem, you won't get an argument from me there. People are living longer than the pyramid scheme required for it to work.

[Puzzledandpissedoff]

You're in danger of bringing common sense into it, Lweji

It also raises the issue of folk taking responsibility for themselves wherever possible, instead of relying on others to provide ... a concept which doesn't always go down well

[Lweji]

Pisssssedofff

In case you haven't noticed, care of the elderly is expensive, pensions are laughable. That is why people do their best to prepare for retirement. Because some of us know what our parents and grandparents are facing.

[mammmamia]

Wow. That's a lovely attitude to life PissssssedOfff.
What about looking at the bigger picture? The social, sexual, gender, equality rights the older generation didn't have or had to fight for?
Casual racism, sexism, homophobia. House or no house I know in which era I'd rather be living my peak years.

[Pisssssedofff]

I like to think the younger generation will claw it back, one thing they the boomers cannot buy is their health. I hope the young people charge £200 an hour for the basic human right of having their Arse wiped, just because they can, supply and demand and all that 😉

[user1471439240]

It is over for Borrow To Let. Buy To Let possibly also, as the former collapses capital appreciation on the latter.
Yes, there has been an echo boom in the last months before the penny dropped.
That is understandable, following a 20 year bull market of unimaginable price gains. But over its is. Really will return to housing.
Speculative greed, in many cases disguised with faux altruistic intent has impoverished the upcoming generation of young people.

[ByGaslight]

IMPO no-one who has a mortgage on a property is a ‘homeowner’, they are a prospective homeowner in debt to the lending bank, but the lending bank owns the property by default unless and until the mortgage is fully paid. They can call in the debt, they may change the terms of the debt and where the debt isn’t satisfied, they lender gets to sell the property to recover it.

Buy to let can mean two things: people who acquire property on a large or small scale and rent it out, but they actually own it. This is a long-term feature of British life, people will always need rentals.

What is new (approx. since the 1990s) is the buy to let mortgage, whereby banks lend to preferred customers who have a better credit rating i.e. a better record of acquiring and managing debt, the older you are and the more borrowing you do, the more change you have to build up a ‘good’ credit record.

Banks came to lend BTL mortgages to ‘good’ debtors which helped to push the price of houses up, doubling them in some areas, during the noughties, as houses became a new type of asset, and via the BTL mortgage, it was banks who by default owned the properties.

The 1988 Housing Act removed many of the obstacles to being a landlord, it got rid of long-term tenant security and at the same time rent controls were mainly abandoned.

BTL borrowers, often ‘ordinary’ people, who could not afford to buy a property outright to start a renting business, could get a BTL mortgage with a minimal deposit and many, many were taken out on an interest-only payment, the idea being to get tenants to fulfil the mortgage payments so the landlord ends up with a paid-off asset. They got to have a ‘business’ with few of the risks of other types of business because the law didn’t get round to treating small-scale landlords as businesses, relying on laws formulated for people e.g. taking in lodgers and giving tax breaks on the income from renting.

Sometimes people took out a BTL mortgage because they ‘couldn't sell’ their house so had to rent it instead. With a few exceptions they meant they couldn’t sell their house for the price they wanted for it, or to cover a debt.

So people without the means to buy properties, but with the credit record to borrow the BTL mortgage from the banks secured housing (still owned by the banks until the mortgages are paid off) in their name and were able to rent it, at a higher price than rentals in previous decades (because rents rose in the new market, the bottom line rental in many cases being the amount the landlord needed to pay the mortgage to the bank), to the people who weren’t able to borrow as much to pay inflated house prices but who pay inflated rent instead. Those people being overwhelmingly younger people, people with less secure work or variable incomes, or whose family life broke down, or people who missed out on the profits from the housing boom.

People with these mortgages, especially taken out recently, may well be in trouble in the next few years, because they aren’t funded like good businesses and the breaks which made them viable are now being removed, George Osborne started the process of removing the breaks and public sentiment will probably support more of it.

[mammmamia]

being, I'm sorry to hear your story and that you're suffering with an illness. But just make sure you're on top of things so nothing gives you a nasty surprise. Could be as simple as reading a Sunday paper supplements which after a few weeks all start to repeat themselves anyway.

[Pisssssedofff]

We've all got a story, I can't count the number of times I've been told to just let go of the kids family home, not that it means anything to them or me now but the equity is literally all we will ever have now and to piss it away would be criminal. My ex would literally have nothing to show for a life time of work, whilst I don't like the man that seems unreasonable, his children should get something.
I've got 30 years of life insurance that I fully intend to claim on because I genuinely cannot see any other way of securing my children's future now. I won't be a burden to them, I doubt I'll be able to support them so ensuring they get that pay out along with the house is the only use I am to them. Often am quite staggered it's come to this

[BeingALandlord]

Yes, I am. But in the spirit of mumsnet (parents supporting parents) let me tell you my story.

I purchased a flat when someone divorced me because he couldn't contain his roving eye. It was my sanctuary for many years and in that place I rebuilt.

It wasn't fancy but I loved it, and it was my sanctuary, my castle. When I met DH years later I found it hard to walk away from my beloved flat, but I was pregnant and so it made good sense to move in with him in his larger house.

Then I got seriously ill with a disease that is unpleasant, degenerative and incurable. It's the sort of disease that people run off abroad to be euthanised for, and I lost everything; my health, my job, my fierce independence. Apart from anything else, I have always been the sort of person who loves to feel free and not held down by any restriction, so it was a hard adjustment to make.

I was pleased at first that the flat was in negative equity because it meant I wasn't forced to let that go too. It has been for many years the only place in the world that meant anything to me, and although my dh's house was ok it never felt like mine and didn't have as much character. It was decorated his way and with his furnishings, and I was too ill to be creative enough to change it. So with everything else falling apart around me, this treasure was not altogether lost. I rented it to a lovely couple and enjoyed their enjoyment of the place.

I researched the basics and knew I have to give 24 hours notice before going in for repairs etc, and even then can only do so with permission. I knew I had to protect the tenants deposit legally, I got myself insured, I printed out templates for all the documentation I needed. Then I handed the keys over and left the tenants in peace. Whenever there was a problem I was on it immediately as though I still live there, because I care about the property and I want the tenants to enjoy it there as much as I did.

But over the years the law changes. Sometimes I find out in the news, like in the case of legionella testing and carbon monoxide alarms (which incidentally I always provided before it was the law to do so), sometimes I find out as I go along, like in the case of losing money through tax returns.
I feel some responses to me asking about the tax change, which by the way doesn't actually start until next year and won't complete until 2021, has been a little bit harsh actually. Perhaps I should give up and sell? But where will I get that extra £30-40 thousand for the negative equity now that I can't earn? Or perhaps now is the time to pay someone to do it for me if I am doing that much of a bad job. I suppose because my disease is degenerative that day will come, but I had hoped to be able to at least do the majority of it for a while longer.

[5OBalesofHay]

I have some nice 2 beds and will consider housinģ benefits. Why us that not oj

[ladydepp]

My BTL flat is rented by a couple who want to make a bit of money in London and then move out to the countryside and buy a house. I'm not quite sure how I'm mistreating them by renting my (very nice!) flat to them until they move or my children want to live in it ???

[Pisssssedofff]

Most of them are clueless

[mammmamia]

beingalandlord are you sure you're a landlord?

[pullingmyhairout1]

BeingALandlord as of 2017/2018 tax year you will no longer be able to do so according to HMRC guidelines us stressed out mortgage advisors have been told.

[TFPsa]

re: Tesco (apologies if points already made, I unforgivably haven't read the whole thread).

as a starter for ten of the things that Tesco does to get food on my table that I myself wouldn't be able to do if I tried to go alone:

(1) use its size/buyer power to strike favourable deals with [alternative viewpoint - 'shaft'] farmers & so on in this country & overseas in a way that i couldn't possibly do myself;
(2) similarly use its size to arrange freight transport of stuff by sea, air, rail, & road in ways that i couldn't possibly do myself;
(3) employs armies of in-house butchers, bakers, quality controllers, etc etc to do jobs that i couldn't possibly [etc];
(4) is loads better at storing [including drying, freezing, etc] stuff than i ever could be;
(5) etc.

etc.

etc.

i could probably string this list out to a couple of dozen points without really trying very hard.

a similar list compiled for BTL would be far shorter, probably exceptionally tenous in most cases, & glaringly incomplete if it omitted the obvious fact that in many cases it's crowding out/competing with would-be owner occupier buyers.

[thecatneuterer]

BeingALandlord Seriously? You're a LL but you don't even know the major headline changes to tax rules? What else don't you know I wonder.

It is being phased in from 2017. You will still need to include mortgage interest on your tax return, as the 20% deduction is still made, but you won't be able to claim 40% if you're a higher rate tax payer.

www.gov.uk/government/news/changes-to-tax-relief-for-residential-landlords

This will particularly affect LLs with lots of properties that are heavily mortgaged. They will end up paying tax on profit they haven't made.

Are you also aware that the 10% wear and tear allowance has been abolished?

[BeingALandlord]

Pullingmyhairout what's this about not being able to offset mortgage interest now? When I did my last tax return they asked for the amout of interest paid that year, so why would they ask if they don't offset anymore?

[pullingmyhairout1]

It is already reducing investment buyers in the area that I live in. the stamp duty and the imminent threat of not being able to offset the interest part of a btl mortgage against tax has made LL's think again here. The average house price is much lower here than the rest of the UK too.

[Dogcatred]

I don't think people get very far when they try to apply morality to this. At one extreme the state would provide all you need ( North Korea etc or we would be a few hunter gatherers on a very big planet owning nothing) and at the other we have pure capitalism.

This year 2016 the Government interfered massively in the buy to let market and we shall see how that all plays out.

[Pisssssedofff]

Individuals are doing their best, everyone is just doing their best, the systems fucked. Being part of a fucked up system makes you morally accountable, can't just point to everyone else and say they are doing it too so that makes it ok. Trouble is there's no point in being the sacrificial lamb is there, what does that achieve, it's all bollocks

[NNChangeAgain]

As for saying it's not the fault of individuals, well no of course it isn't

You originally said that it was - that individuals were "morally wrong".
I'm pleased you've reconsidered !

[Pisssssedofff]

As for saying it's not the fault of individuals, well no of course it isn't, but it's not right either and just because everyone's doing it doesn't make it right.
I'd love to see a poll of all those renters want to privately rent - and there will be some - v's those who've no choice in the matter.

[Pisssssedofff]

The people I rent to were actually put in the position they are in by having to go bankrupt due to a tenant not paying their rent when they let out their property to move abroad and they lost everything - I hope that's not too identifying - the whole thing is a shower of shit as concepts go.
At some point you have to get back to the fact that houses are homes not investments. My tenants wish they'd never let their house out, if I was able to buy a house for three times my salary and a 5% as was the case in 2001, I wouldn't be needing to rent mine out and that would be a permanent home to somebody else. It's all rather stressful, expensive and biased and I genuinely can't see who's winning tbh.
LL's with a 10% yeild seem thin on the ground, they are all praying for capital gain and yet if they get it they are shafting the very kids they want to be looking after so all their efforts of investment will just be putting their children in the position they would have been in the first place had btl not artificially inflated it in the first place. All that stress and hassle and the only winners are the banks and government. I can't believe people fall for this shit but