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)

Successive governments have also all repeatedly ignored that many first time buyers have large deposits but lower incomes. The various help to buy push up the prices schemes have only made things worse. Simple inflated the bubble.

Someone mentioned Blackstone? Ugh. Does George Osborne still have his grubby hands involved in this company? It doesn't bode well for the people of Scandinavia if this company is allowed anywhere near their housing stock.

Let's say you outlawed BTL to lower the demand for housing. That would reduce the supply of rental housing, and rents would go up, so then renters would be harmed.

No, what would happen is first time buyers would be better able to afford a home to buy - without having to compete against investors (who push the prices up).

I never said that it wouldn't make it easier for FTB's. If you're going to legally restrict demand prices will be lower for those who can still buy. But rental housing goes off the market on a regular basis. People who were renting while they worked abroad returning home, for example. If you forbid adding to the rental stock it will eventually reduce, raising rents.

By the way, supply, as it's relevant to prices, isn't every residential structure in a particular area, it's the ones that are actually on offer for sale or rent.

@jacketdrama

I find it bizarre on these kind of threads when people turn up and defend their owning of multiple properties by saying its their pension, their nest egg etc. Surely you understand that one day when you sell that property, your tenants over the years will have effectively paid for it, and paid for your security whilst not being able to afford any for themselves? Even if rent doesn't yield a constant profit, a btl mortgage by its very nature requires a tenant to service it

I hope you've checked exactly what your pension fund invests in and that there are no property companies or anything else that exploits ordinary people or contributes to a system where property isn't affordable. I'd guess that my small scale enterprise - one property and trying to be fair to my tenants, is probably less exploitative than a lot of investments made by the average pension fund.

I don't have a private pension believe it or not.

It's not greedy IMO without such people many of us wouldn't have a home to live in.
It isn't landlords fault insufficient or unaffordable housing isn't avaliable.

My only concern it is used as a cuckoo fund from international buyer's who don't pay tax and will boost their finances thousands of miles away in Ireland.
Canadian investor retirement scheme's are buying up blocks of apartments making it even more unaffordable.
I'm a renter.

It's an investment and property has been a good investment, well, always but especially in the last 20 years.

I was renting in the 90s before Blair's Buy to Let make the Blair family millions scheme got started. If was very easy to rent then. As a student, and for friends who were on benefits. This was in London, where demand for housing was already high.

As buy to let took hold, things became increasingly difficult for first time buyers and for low income and vulnerable people. House prices started creeping out of reach, trapping many in long term renting, and the low waged and vulnerable started to find themselves locked out of housing altogether (because instead of renting to them, landlords let to the first time buyers they'd priced out).

Increasing it became essential to have family money to secure a stable home.

I've rented twice in recent years, I'm grateful to the two (good) landlords for renting me a home when I needed it. Not everyone can buy, or perhaps it's a timescale thing, we need rentals

I do think landlords are bad people, I deal with them everyday and just this last week have struggled to get one to repair a pensioner's home - all they talk about is costs and their greed.

Never ever had one have a kind word to say about their tenants - I feel BTL are evil.

Read about the rental economy and people making money by having rather than doing?

They are not wealth creators or entrepreneurs.
The ones I deal with are lazy and greedy - usually married or inherited their wealth.

The only people I know now who buy homes for themselves are helped by their parents, we do not have a meritocracy.

@minniemomo

I've rented twice in recent years, I'm grateful to the two (good) landlords for renting me a home when I needed it. Not everyone can buy, or perhaps it's a timescale thing, we need rentals

We need social housing rentals.

Private renting on benefits is a council issue. I know it is similar in the UK.
An example of a neighbour she is 12 years on a council house paying rent from the government, had the council bought a privately owned property 12 years ago they'd have paid the mortgage and received rent for it.
Instead they've spent around €160,000 on rent.

We need social housing rentals.

The problem with the hat though is loss of choice and control. You get no choice on the size of property and minimal choice on the location. I want a spare room, a home office and to be close to my kids school. I can't have any of those things with social housing. If it's close to my kids school it is mainly luck.

We tried in a sense to ban buy to let with the rent acts decades ago. When I was moving to London in 1983 we were just coming out of that time. I think assured shortholds did not then exist so no landlord wanted to let as people had rights to stay for life and some rents were £10 a year fixed for life. You can still search by postcode to see which property es are regulated tenancies under the legacy of that system and they are often half an open market rent. I was in one room in 1983 paying £50 a week ( £745 a month allowing for inflation) , just a hob in corner of room, dirty shower was used by everyone and at end of corridor up a flight of stairs.

The ASTs came out and suddenly decent properties to rent became available. Rent controls did not and do not work.

@Xenia I believe in capitalism

No shit.

However, you stated in your earlier post that your sons are actually doing this as a charitable enterprise and losing money in order to selflessly provide homes, at their own expense, for tenants.

Which is it?

I did not say it was done for charitable reasons. I said they might well make a loss - in fact I am the charity really as currently I am paying the costs which are so far about £10k on each house with rents at £12k a year and my sons keep the rent. I did say however that where the landlord makes no profit then it is in effect a gift from landlord to tenant and thus could be seen as charitable.

Obviously the reason I have helped each child to buy is just like a parent feeding their child good food or breastfeeding it - because you want to help your child - a moral good, just as you pick a good school for them. These are things we admire as a society in the UK. When my sons leave home and have a job they will live in their house or sell it and buy one in a different area which they prefer. If they make a capital loss as I did on two buy to lose flats in the 1990s - massive losses in a property crash - that is just how the cookie crumbles. If prices have risen then that will help them move to a bigger place

I know people get very upset about this topic but it is a complex issue. Many mumsnetters are home owners and landlords and plenty believe the right to let out a property is fine as do I. Others are against it.

Those against it might like to think of ways to ensure the Labour party get elected however as it has not been since 2005 they have won an election as their policies are so out of touch with ordinary people and they are so left wing. that is probably the only way to get radical change in this area (thank goodness)

@jacketdrama I hope you've checked exactly what your pension fund invests in and that there are no property companies or anything else that exploits ordinary people or contributes to a system where property isn't affordable. I'd guess that my small scale enterprise - one property and trying to be fair to my tenants, is probably less exploitative than a lot of investments made by the average pension fund.

I am self-employed. I don't have a pension at all. I have a small number of investments and yes, I absolutely do check exactly what I'm investing in, and only invest in ethical funds.

Why do you find that so difficult to imagine? Some people do prioritise ethics over money. Not BTL landlords, obviously.

*That was probably me. Let's say you outlawed BTL to lower the demand for housing. That would reduce the supply of rental housing, and rents would go up, so then renters would be harmed.

If you had more housing stock both rental and purchase prices would fall as equilibrium was established at lower levels.*

You don't have to ban it to enable people to be able to buy. Regulate it more, make it more unattractive.
Its not as simple as just carving up more of our countryside and building more, screwing the environment over in the process. Which would ultimately leave houses empty.
Start with social housing get that built or bought, get people back into social housing get them out the private rental trap, that would begin to ease the rental demand. Tax payers money should not be going to private landlords unless theres extreme circumstances of something being unavailable.

Essentially what needs to happen is a big massive price crash, but clearly that would be catastrophic for every owner out there and would halt the market. They should never have propped it back up in 2008.

Average wages should equal the average house price in lending terms.

One landlord selling his property portfolio in a fit of civic conscience is not enough, another will come along and snap them up.

I did hear of a man who owned two properties in a village, when he died he left them to the parish under the provision that it was to go to local people, you could only live there for 4 years (If i remember rightly) and the rent was capped. This gave locals the opportunity to save and ultimately stay local. This seemed an incredibly generous and well thought out idea.

Perhaps OP could provide us with a list of what it's OK to invest in.
Pension funds are spread across a number of industries. E.g pharmaceutical companies.... Making vaccines... Is this OK with you?
Not all LLs are sharks. I have a sibling who is in a rental property, been paying the same rent, below market value for years because LL knows the house is looked after.
I'm an accidental landlord due to inheritance. Is it OK with you if I rent that property out and pay my taxes on the income? Is it OK with you if i fully insured it and keep up to date with all the safety stuff? The current tenant does not want to buy because of their circumstances at the moment. Is that OK with you. Or should I sell it and bank the money? What would be the right thing to do?

Get off your sanctimonious high horse OP.

People have to live somewhere, some will never be able to buy due to various reasons, and there aren't enough housing association properties to go around.

@Xenia I did not say it was done for charitable reasons. I said they might well make a loss -[...] and thus could be seen as charitable.

Do you think that is some sort of meaningful distinction? It could be seen as a failure and incompetence. It's not charitable by any stretch of the imagination.

I couldn't vote Labour in the last two elections due to them being led by a raging antisemite, even though I support their economic policies. Funny, it's like the exact reverse of your position, huh?

[quote jasjas1973]@CirclesWithinCircles

Its what was said...

We buy auction properties that don't allow a mortgage, so yes, a young couple could bid just the same, as long as they have the cash

Yes "out of touch"

The wider issues are driven by BTL landlords, competing with FTB's who simply cannot raise the funds these folk have access too.

..plus i was NOT even talking about you, i quoted another poster....... so not sure why your getting so angry?

An apology perhaps?

Your last remark was quite rude and unnecessary, maybe look at another way of making your point?[/quote]
Ha Ha, out of touch, really.
You have no idea what I nor my family do with their properties.
I can assure you, buying properties at auction is not something young people do, or want to do.
If they can manage to find the cash to buy them they aren't going to be able to afford to renovate the place.
If they do have the money to do it then they too can attend auctions just the same.

My properties don't always make money, but there's invariably a family living in them, with nowhere to go.
We don't sell properties we just buy them and keep them, pass them down to the next generation.

saying its their pension, their nest egg etc
A more accurate description might be 'this property is a pipeline via which the wages of a working person are channeled into my pension fund'

I hope you've checked exactly what your pension fund invests in and that there are no property companies or anything else that exploits ordinary people or contributes to a system where property isn't affordable. I'd guess that my small scale enterprise - one property and trying to be fair to my tenants, is probably less exploitative than a lot of investments made by the average pension fund.

This! I really don’t think people look at the bigger picture do they?! I know very little about real estate, investments, property portfolios yet even I know that money is swooshing around all over the place, billions tied up in a gazillion different pots. Including pension investments.
The BTL landlord with a few properties is small fry. They are not the big fish in this game!

@Puzzledandpissedoff

There are many varied reasons that people buy to let, some out of greed but not all

Not on MN there aren't; here, nuance on the subject is intolerable to some and BTL LLs are apparently b**tards one and all

Strange, really, that sweeping generalisations are usually howled down ... except when they're about a preferred hate figure in which case they're okay

This is literally a thread with 500~ posts on it. Think you’ll find that plenty of people have different opinions on it.

There's capitalism, and then there's unfettered unregulated capitalism
exactly, people who speak as if there are only 2 options, capitalism or North Korea....are they really dim enough to think that or do they think the rest of us are!

jasjas @CirclesWithinCircles**

Its what was said...

We buy auction properties that don't allow a mortgage, so yes, a young couple could bid just the same, as long as they have the cash

Yes "out of touch"

Those are not even my words now! First you accused me of saying something by neglecting the second part of my paragraph discussing the difficulty for young people of obtaining mortgages for properties needing renovation, and now you've completely made up a sentence.

Why are you doing this? Do you think being dishonest is ok?

And who are "we"? I've only ever bought properties alone, and never at auction. Really annoyed that you are not only misquoting me but now blatantly making up whole sentences!