Greed of ‘buy to let’

[LittleLottieChaos]

When did people start to think that they should profit from housing? It all feels incredibly Dickensian. Pees me off when I see housing being listed as buy to let investments rather than ‘here’s a house for a nice young family to live in’. Especially with the market so horribly skewed right now.

It is shocking that people seem to think they have a right to profiteer from those less fortunate by whacking on high rents, that more than cover their mortgages. Legit: you need one house, one house only. Or maybe I’m missing something... or these are genuinely just bad people.

Interested to hear how people justify it? Do you just think, fuck ‘em I want to be rich? Do you not think about the morality?

(I rent but am saving to buy an appropriate house to live in... not to profiteer from)

I don’t really understand your argument- it’s a business like any other. As long as the land lord looks after their tenant and doesn’t charge extortionate rent then I don’t see the problem. Not everyone can or wants to buy a house.

£50 spending money
Yeah, that's the high life all right

@WWYD2020

the rents can be fixed at a low rate to allow low level earners a chance at a better quality of life

Move to a different area.. you don’t have to stay in an expensive area.

Have you heard of London babe? We can’t all work up North.

I am actually in a comfortable position myself now. However did rent for many years in London, small flats - and I would eye up the cheapest I could get away with to save money. I was on a good salary. I feel for those who aren’t high earners / what do you propose they do?

I Think there is a need for the rental market (we rent currently and our landlord is fine) as there as some people who want to rent for whatever reason.

There is absolutely no reason why the rental market has to be dominated by private landlords though. This is a political decision - it could quite easily be legislated in such a way that only non-profit housing associations provide rental housing.

If the price of food had gone up at the same rate as the property market a loaf of bread would be about £35

And a chicken £50.

Arguably food should have gone up the same amount as property to enable the baker and butcher to buy a house. But they haven’t.

Profiteering. Yes that is exactly what it is to some landlords. A small story.
An elderly person had to move in with family. Family didn't want them in a home. No way, blah blah, despite advancing dementia. Elderly person had taken the chance to buy their council house, having lived in it since the 50s. They were very proud of owning their own home.
Landlord, who happens to own half of the estate, approached family of elderly person in the pub and says he has heard of the pending sale. Private sale happens. They sold the house to him for £50k less than market value. All above board. BUT not all was what it seemed. He had given the other £50k in cash (fuck knows how) to the family, not the elderly person.
Lo and behold. Within 5 years the elderly person is in a home. The majority of her money spent and the £50k squirrelled away by family. Landlord has another house to add to his collection by sidling up to people in pubs who are happy to break the law and let others suffer.
The estate itself was once well maintained by many people who had been there for over 50 years. In the last 15 of those the estate has become rundown and a hub for antisocial behaviour. What role does a professional and likely gamgster landlord have here?

This isn't an argument against reform of the system but if I had an adult child whose job provided a roof over their head, I'd advise them to get a btl for financial security. People I've known in this situation include my mate who grew up in a former stately home as her mum was the manager, a country vet, people in the armed forces, and my friend who was married to a vicar. Should these people be allowed a btl as they only own that one property, or is all home ownership of somewhere you don't live considered wrong?

Also, my brother was declared bankrupt. If he couldn't have rented he could only have lodged, which he did initially but is a pretty shit way to live long term. He didn't have kids at the time, luckily.

The problem isn't buy to let, someone needs to own these houses anyway. The problem is that they can ask as much rent as they want, there needs to be a law to make it still profitable but also affordable.

Question, if you ever do get on the housing ladder, do you expect to sell your house for more a couple of years later? Because that makes you just as much part of the problem.

@BadLad

I let to students, who have to live somewhere.

When I started working I didn't want to spend more than a couple of years in the city where I got my first job. So I rented a place. I don't think all letting is to people who want to buy a house but can't.

I agree. As long as the rent charged is not exorbitant, I see nothing wrong at all in buying a place to let. It's an investment and will probably mean the owner will not need much state help in retirement - or they will be able to help their adult children get on the ladder. Either way the outcome is good.

I've known a few people over the years who have owned such properties and they are not rich. They provide decent, affordable housing and have a little investment for themselves.

One of my relatives rents a small, three bedroomed detached house in a London suburb which is owned by a fairly young couple who run a restaurant. It sounds grand-ish but my 'relative's' house really is very small indeed, has the width of a plank separating from house next door, no garage but parking in rear yard. It suits them. They've been there for a few years, the rent is affordable, the landlords fix anything that goes wrong and tenant is able to save towards buying their own house.
The landlords are quite ordinary people who haven't been doing all that well during lockdown but ticking over.

In the meantime the tenant has inherited a flat somewhere in the country and currently letting that to a friend. Nobody's objecting or thinks anybody is growing rich/exploiting anyone else. People are housed which is what matters. I too have inherited a flat which I will sell eventually but at the moment, am letting to a couple with a child (they haven't paid me any rent since January but that's another story).

Some people are thinking of 'landlords' as being like Peter Rachman of 20th century history, but they are nothing like, they're just ordinary, like ourselves.

Could say that about anything. Why should anyone profit with any business? The way if the world I’m afraid.

@Chocolatehabit

I don’t really understand your argument- it’s a business like any other. As long as the land lord looks after their tenant and doesn’t charge extortionate rent then I don’t see the problem. Not everyone can or wants to buy a house.

I'd ratherhave a fixed mortgage more than have seen my rent double within a decade. AND I don't want to have to still pay rent on retirement. Pensioners don't earn much.

Actually, I take back what I said about people being able to invest in housing associations. I would want them to be non-profit, so that doesn't work.

But I 100% believe that housing should be provided socially and not for the profit of private landlords, many of whom provide shit quality housing for extortionate rents simply because they can. Maggie changed things in the 80s, there's no reason at all that it couldn't change again.

YABVU.

Well as someone who has rented several but-to-let’s over the years, I’ve been very grateful for good landlords and slightly below market rental prices, clean, safe, comfortable homes that I loved to live in. Knowing that if the boiler broke it wasn’t me who had to pay to fix it.

There will always be people who need to rent, who can’t afford to buy. Why shouldn’t they have nice places to live? Or should we expect the council to have to home them all in poky high rise flats down the “bad” end of town?

Even if deposit for buying were a fraction of what they are now there’d still be a rental market.

@DinosaurDiana

Perhaps because they’ve not saved the deposit required ?

And why do you think the deposits required are so large?

@WWYD2020

the rents can be fixed at a low rate to allow low level earners a chance at a better quality of life

Move to a different area.. you don’t have to stay in an expensive area.

You know that basically means no low earners in the entire south east or within commuting distance of any large town?

I live in an area which is laughed at on here.
I still can’t afford to buy. What happens when your prices out the shit area?

I can’t afford to buy anywhere within at least a two hour commute.

Your stuffed if you’ve elderly parents you care for, or who support you with childcare. Or your self employed with employees.

@TableFlowerss

Could say that about anything. Why should anyone profit with any business? The way if the world I’m afraid.

Would you say that about the NHS being turned into a for profit service, run by private individuals? Or bin collections? Or the police?

Just wondering.

@EvilPea

If the price of food had gone up at the same rate as the property market a loaf of bread would be about £35

And a chicken £50.

Arguably food should have gone up the same amount as property to enable the baker and butcher to buy a house. But they haven’t.

Actually you could argue the cost of food has been reduced and squeezed so that people can afford to pay larger mortgages.

The consequence is terrible quality food, worsening animal standards, lots of packaging to make it cheaper to produce, etc.

My parents are having several hundred new builds put up behind their home. They have done about 50 and one has already been let out. First of many I assume.

or they will be able to help their adult children get on the ladder. Either way the outcome is good.

For those adult children as individuals, yes, good outcome. For society as a whole, probably not a good outcome when that’s the only way people can afford to buy.

No doubt you also object to mortgages as that is profiting from a basic need as well. Or supermarkets, clothing sales, paid health workers...

Except you don't because your jealousy is for people who have more money than you. Knee jerk landlord hate never includes logic. Boring stuff, been done before. Go donate to shelter if you are that bothered. They are the housing charity that provides no shelter but simply campaign to fuck things up for renters. They want to fuck things up for landlords but keep getting it wrong.

My house (referred to at the top of this set of quotes) was £45 k when I bought it in 2003 and £50k when I sold it 5 years ago. An extra £500 for a ten percent deposit.

I think homes are available, they are just in the wrong places. I was lucky to be employed just down the road, but most people commuted 45 minutes to the nearest city.

@everybodysang

amazing how every single BTL property owner on here is a great landlord not making any profit.

It's a very flawed system. We need much more stringent regulation of the rental market, more powers against shit landlords (and if you're really not a shit landlord, well, you've got nothing to fear, do you?) and if that drives out landlords who can't cope with it - sounds like a win to me.

Oh no, I definitely do make a profit. However, my tenants rents (so far) has always been paid by their employers, ie big multi national companies, so I'm not fleecing some poor single parent with 4 kids whilst making them live in a damp 2 bed flat (not that my flat is damp). I agree though, the there are some terrible landlords who do act that way, but I really don't think it's the norm. It would be great to get rid of them, as they give all landlords a bad name.

@LittleLottieChaos

Interesting to read the comments. I of course understand a need for rental homes for some, or for those who enjoy renting. That’s fine.

If the rents can be fixed at a low rate to allow low level earners a chance at a better quality of life. Surely any one with half a brain cell can see how this would positively impact society on every level.

So landlords will sell (as many people mentioned, the numbers are already tight and the risk/hassle of being a landlord is not appealing). Property prices may drop if the market is flooded with ex-rentals. Hooray - we can all buy!

But what about those who don't want to/can't buy right now? Where do they live? What about people who need to move around for work - do they have to go through the hassle of buying and selling every few years? What about the empty houses that are no longer worth renting out? Do they sit empty while would-be renters struggle to find a landlord willing to bother letting a house out with or little or no reward?

We are about to become accidental landlords.
I would really not like the hassle but i cannot afford to lose this much money.

We do this one every few months, it seems. The obvious answers are:

Some people, at various stages in life want to rent
Some people throughout their lives don't want to buy
Some people throughout their lives won't be able to buy
So rentals will always be needed.

Landlords are either your pension providers or individuals.
Individuals with 1 property to rent, maybe a blended household, married and don't want to sell for whatever reason
Individuals who make their living from being landlords, to students, to anyone.

BTL was intended to make it easier for individuals to get funding to provide rented accommodation.
BTL was too easy to abuse (wonder why?)

Individual landlords are now shedding their houses as the governments has decided to tax and legislate them out of the market.

In 2016 a survey found that:

• over 60% of landlords in the survey owned only a single rented property.
• only 7% owned five or more, but these larger landlords accounted for nearly 40% of the rented dwellings.
• Almost half of all properties in the sample were purchased using a buy-to-let (BTL) mortgage. Landlords with one or more BTL mortgage tended to have larger and more valuable portfolios than non-BTL landlords – with almost a quarter of BTL landlords having portfolios with a value of at least half a million pounds.
• BTL landlords are somewhat younger than other landlords. About one third of all landlords in the survey are retired, with retirees concentrated among non-BTL landlords
• About a third of landlords said their rental income was between £5,000 and £10,000 per annum. The mean rental income was much higher at £17,300 – and higher still for BTL landlords at over £20,000.

In 2020 another survey found

• 37% of landlords in the survey stated they now had plans to sell their property
• 69% of those asked also suggested that the costs of managing their property had grown “considerably” due to these changes, meaning the Government has succeeded in disincentivising buy-to-let.
• 72% of property investors we surveyed believe current tax and regulation measures make life unduly difficult for landlords

The property press has stories of landlords and letting agents selling up every day. Where are those properties going? Pension pots? Large portfolio holders?

This year will be the first time that landlords can't deduct mortgage expenses from rental income. Capital gains tax has been raised on BTLs. That one off tax hit we are being promised will also hit landlords. The stamp duty holiday will end shortly.

Add all of that to the covid restrictions that has led to many landlords being stuck for over a year with a non paying or otherwise unwanted tenant; the continuing additional regulations that covid has not modified, many landlords are rethinking.

Those renting might be in for a shock! So will home owners. If even a fraction of that housing stock gets dumped onto the market over the next 18 months we're in for one hell of a recession... on top of the damage done by covid.

I'm not a landlord, I just work in the sector. Every day I see tenants worried that their landlord will sell up and landlords trying to make their finances balance. Letting agents are changing how they work, cutting their costs, trimming fees and still having to do all the additional work that was dropped on them by all the various compliance changes - landlords also have to do all of this too.

The BTL gravy train ended a couple of years ago... it is now rumbling to something of a halt. And, having lived, as a flat owning adult, through one housing crash, the thought of that terrifies me!

Got to love an all land Lords are scum thread. 1stly it's not a tax dodge and landlords pay more in taxes than they would if money invested elsewhere.2ndly if there wasn't the demand for people to rent landlords wouldn't exist.