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)

There are a lot of accidental landlords, I was one, I couldn’t sell a flat and wanted to move out away from the area to be with my DH. The only choice was to let it out . I did this for a few years and didn’t make any profit until I sold it.

It was in excellent condition, I did everything legally I had to do, if anything needed fixing or replacing I did it. One tenant didn’t pay the last months rent and then spilt red paint over the carpeted areas and on the curtains and broke items of furniture so I was very out of pocket getting it tidied up for the next tenant and after that, I was always worried that a similar thing would happen again.

I would never be a landlord again.

This is an incredibly basic view point. The rental market will never go away because its useful to a lot of people. There does need to be a change in how much someone charges to rent a flat/house/room - speaking from experience in London, the prices are hideous for you get.

People need to rent - if there are fewer houses to rent then rental costs will go up- too many houses and rent drops

It's just a way of living - some need or want to rent a house or room(s) for whatever reason

I only recently found out (here) that when you buy a house to rent, the mortgage company insists you rent it out for at least 145% of the monthly mortgage payment amount, so it's not just greed. It did go crazy a few years ago with people buying up loads of property to rent out. My own landlord has dozens with a yearly turnover of over £1 million

That said, people need to live somewhere, and wherever theres a market there will be people willing to fill that gap.

There are shitty landlords, but there are also shitty tenants who dont pay and especially with the pandemic, this has far more serious consequences for the landlord.

There comes a point OP when you just have to accept that this is just the way it is, and it wont turn around in my lifetime, or maybe ever. There are too many people on a tiny island with limited space.

I don’t think profiting from housing is new (see comments re: Dickens) and there will always be a need for rentals - affordability aside, some people/at some stages in life only want to stay somewhere temporarily/prefer the flexibility of renting.

That being said, the housing situation in this country is bonkers and the rental market in particular is really shitty. I don’t blame people for wanting to do BTL - it’s not unreasonable to want to make money and not all landlords are evil - but very much blame the system and lack of regulation that has enabled things to become so skewed.

I have a property I rent out, it’s not big enough for a young family to live in. It’s the sort of place that young singles or couples live in, and there are plenty of situations where people want to be able to rent rather than buy.

I don’t feel the need to justify it because I’m not benefiting from anyone else, and I barely profit. I provide a service that is mutually beneficial. It’s better than relying on benefits to take care of my old age and to top up my low income job now, and if I did have to justify it, that’s how I’d do it. I’m relying on my own family and the inheritance I received to be able to live, not relying on taxpayers so that I can afford my choice to have children.

And why no holiday letting? Why is it disposable? Is it therefore morally abhorrent to rent a holiday cottage or house? Often in areas where they rely on tourism it is part of the local economy.

I’ve worked very hard and saved to buy a small home, to live in.

If I lost my job, I would get very little help to pay my mortgage. But if I was renting, I’d get housing benefit and pay someone else’s mortgage for them.

We would never have managed our career progression in the first few years without moving every year, a huge number of people need the mobility that renting provides and benefit hugely from it.

Where the problem lies is people who don’t need or want the advantages of renting but who are priced out. That is a question of supply and demand, but nobody wants thousands of houses built near their home, or their home value reduced.

That said, people need to live somewhere, and wherever theres a market there will be people willing to fill that gap.

The thing is that before 1989 it as a much cooler market because tenants has security of tenure and BTL mortgages didn’t exist. There were still rentals, though, just without the frenzy and churn.

To add, not disputing that some people want to rent and that rental property needs to exist, my issue is the rents.

If I bought a second property I would consider the piece of property itself and the equity I'll make from it as my investment for the future. So long as rent income covers the mortgage, insurance, maintenance & a bit aside for periods when it might be empty, then all good. The problem is (around here at least) landlords making generous monthly profits too, by charging far far above what the property is costing them.

I was very lucky to have help through inheritance to buy my little flat. I'm one of a handful of owner occupiers in my building, and I couldn't afford to rent in this building. My mortgage and service charge come to a bit less than £800 a month; whereas I could probably rent the flat out for £1200 + bills.

@Tryingtogetbacktomysize10s I’m gonna be honest, we’re not going to be best mates.

Well I see it as a shady continuation of the housing abuses of the Victorian era? Hence Dickensian... outmoded and not compatible with our contemporary perception of how ‘far we’ve come’ as a society? We haven’t really have we. But you don’t care, so you do you.

Completely agree OP.

@TheDoctorDances

I’ve worked very hard and saved to buy a small home, to live in.

If I lost my job, I would get very little help to pay my mortgage. But if I was renting, I’d get housing benefit and pay someone else’s mortgage for them.

I’d never though of it quite like that before.

I mean I know how much housing benefit goes to small landlords, because it’s been remarked on before, but I hadn’t really thought about how owner occupiers don’t get the same security on their mortgages of things go south.

@Porcupineintherough

Out of interest, whyis it so much worse to make money out of housing than out of food, or energy, or water or medical supplies? Should they all ne provided on a not for profit basis also?

Yes. Considering the billions wasted by the government since BJ was PM, I don't see why not if the money's clearly there albeit wasted/squandered/pocketed atm. There shouldn't be profit making when it comes to basic human rights like housing, food water etc.

My landlord owns over 100 properties and he doesn't even live in this country for most of the year. I think its terrible. Something should be done but it won't. Either stop BTL mortgages or make them very difficult to obtain.

[quote Lanique]@DinosaurDiana and why do you think the majority of renters can't get a mortgage?[/quote]
I'd guess they can't save for a deposit because their rent is too high.

And/or they can't afford to buy because prices have inflated, partly due to buy to let landlords.

YANBU, but there are a lot of people here with money and they won't see this point of view

I couldn't say when it started - possibly the dawn of time? I grew up in the 60s and we moved from council accommodation to private rented when I was 3. Presumably our landlord in 1965 had bought the property to let out. It was seen as a step up socially to live in private not council. My FIL who recently died in his 90s came to this country in the 1950s and spent his life working hard to buy and renovate old properties that he rented out. Those properties became his pension and even now the proceeds from the sale of the last one are paying my MILs care home fees.

@RickiTarr you're right. I was born around that time and my parents lived in london and never had to or wanted to rent. They saved and bought a fixer upper, extended it and sold it for profit. My mother still hates that I spend so much in rent, calls it dead money but what can you do.

The government pushed this, 'invest in bricks and mortar' and combined with ridiculous free flowing credit and being able to use capital in existing property to get new ones has made the whole thing out of control.

Who owns the house you rent? Housing Associations don't have housing stock to meet the demand for the rental market, private landlords are essential.

Where do you think the housing stock comes from?

You have a very short sighted view in this.

The average buy to let landlord has one or two as investment/pension. There are a few professional landlords granted, and yes it can feel morally wrong.

@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)

People have always invested in land and property and housing. Feudal lords onwards. The difference is that from the late 1980s the Tories deliberately chose to take away renters rights and given individuals the right to get a "BTL" mortgage to borrow to invest in residential property.

The population continues to vote for the Tories - to vote for a nasty form of capitalism that encourages the richest and greediest to exploit ordinary people, which is why we have things the way they are.

I justify it quite simply. I am growing up in a nasty form of capitalism. I don't get on with bosses and don't like working for other people. I don't trust pensions particularly. In this disgustingly unfair system that I consistently vote against I have to do what is best for myself and my family within the law.

I am not affecting the supply of housing either - it's just that there's one more house being rented out and one less in the hands of owner occupiers... though of course if I sold it it might well get sold to a BTLer (or to an owner occupier who lives there for 2 years and sells to a BTLer). It is people who keep property empty who are morally bankrupt, and rich old people in big old houses whilst their kids bring up families in flats are pretty immoral too.

A big part of it is when I worked out that most people spend about a third of their income on housing costs, so if one owns three properties outright you can likely have a pretty good standard of living for the sort of person who lives in that type of property.

@DinosaurDiana

Perhaps because they’ve not saved the deposit required ?

And why haven't they saved a deposit? Because they are paying a ridiculous amount to fill another persons pockets...

But you yourself rent, you yourself needed someone to buy a property and rent it to you, as do many others, so why are you all pissed off. Would you prefer to be homeless?

I completely agree OP. But then I’m a socialist so I would! I think everyone should have the right to buy their own home and houses should be more affordable. The buy to let market pushes prices up and increases inequality. I think it should be taxed more, personally.