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)

It’s hard when your paying more in rent than the equivalent mortgage.
But banks won’t lend the amount required to buy a home.

I have the deposit

It’s a complicated issue, I think it started with the sell off of council homes in the 80’s, the non replacement of those council homes. Then the self cert mortgages pushed house prices sky high, banks also freely lent to property developers. The crash in 2008 should have corrected it. But it didn’t due to the props. So now you have average houses way out of average wages.

It’s detrimental to the feeling of community, “belonging” and to our children to have so much upheaval. Unable to make something a home, paint, put pictures up, grow flowers and vegetables, have pets. Children’s school allocation. All controlled by someone else when you rent

@DinosaurDiana

Perhaps because they’ve got a bad credit history ?

4.55 million people with bad credit?

I don't own a BTL, but letting property is just a business like any other. People need to make money to live, being a LL is just one way of doing that.

I've had some great LLs in the past, and I'm glad they saw it like a business, otherwise I wouldn't have had such fantastic service!

People can make money how they please, as long as they are within the bounds of the law.

And no I am not a landlord. And yes I have been a renter.

Anyone who feels there are issues with any type of entrepreneur making an income, just comes across bitter.

Water your own grass instead of being jealous of others.

The problems isn’t private landlords - they provide a service for those who want or need to rent. That’s fine.

The issue is that rents are too high - way too high. We should bring back Rent Officers and have some kind of maximum rent system, dependent on local area.

Housing Benefit should also be available to home-owners who qualify to help with their mortgage just as they’d get help with their rent if they rented.

There’s not enough social housing and Thatcher was ridiculous to sell off council houses. There should also be stricter rules about council housing and who qualifies.

The real issue is the price of property. When we bought our first home, almost everyone had the possibility of buying a house if they were working, even if their work was fairly low-paid. The price of that first house we bought has now more than tripled, whereas wages haven’t kept up with that.

So Buy To Let should be allowed but rents capped.

But us renters have to get houses somewhere, if no one rented we would have been homeless for a long time as we didnt have a deposit, now we do but are taking our time to find the right house and right time to move.

Also they have to charge more than just the morgage rate, landlords have to have insurance, annual checks and pay maintences (my house has need 2 new roofs (its over 4 levels so theres 4 roofs), replastering, some electrical rewireing and the radiators replacing in the last 10 years - it the land lord paying the lumpsum for those not me).

I do get irrateted at the older generation that dont understand housing isnt free though. If I hear one more 'just get a council house' comment Ill scream, there are no council houses left here because the generation telling us 'just get a council house' bought them all up decades ago as 'starter houses' but now they have moved on they are all expensive rented houses (a 1 bed flat right next to the railway where I grew up is now over £600 a month private tennency but that was a cheap but lovely council estate when I was little). They cant seem to grasp that if they bought them all there aren't magically new ones appearing.

@Angrypregnantlady

I don't believe people should be able to own things just because they want to. There are millions of businesses earning money by supplying people with things they can't afford. Like smart phones on monthly contracts, credit cards, cars on credit, cars on lease, holiday villa rentals, flying. Can you afford a plane? No. But you get to use one because someone who can afford one buys it and let's you use it. Rental housing is just one of those things. You can't afford a house, but you get to live in one because someone who can afford it, buys it and lets you use it.

If you didn't get to own more/better things by working harder, then no one would work harder. So no one would do the big difficult jobs that need doing, no one would earn enough money to pay all the tax it takes to run this country including the massive benefits bill.

And this would be fine if there was a possibility of buying a house through working hard. As it stands a person could work 40 plus hours a week on the average wage and still not having any hope of buying a house unless they inherit.

@Crankley

I think you're being unrealistic. Take away all the buy to lets and what are you left with? People who can't afford to buy homeless, living on the street.

There's nothing to stop a person buying a house destined to be bought for btl except no deposit, bad credit history, only need short term accommodation etc.

Nonsense! Take away the vast majority (not all) BTL's and the Govt would need to replace with social housing.. you know, like govts did when millions of service men and women came back from WW2 with little or no money.

What stops FTB's buying houses that attract BTL buyers is the FTB needs a mortgage, many BTL landlords are cash buyers and can move instantly.

So, my DD and her partner have put in genuine offers on numerous properties (some above the asking price) around the 150k mark in Plymouth, each and every time, they lose out to cash buyers and the property goes on the rental market.

So you don’t want there to be a private rental market? Just to be clear, you don’t think there should be rental properties available for anyone other than the (limited) amount available through local authority housing?

@Sweetpeasaremadeforbees

Did the tenants pay for the minimum 25% deposit?

You'll get that and more back in rent. And unless we have a massive financial crash that 25% is pretty safe.

And I guess the tenants would struggle to come up with 25% because of the massive rent they are paying every month to their landlord.

What absolute crap. I made £1250 on one property in profit last year, after tax. My deposit was 36k. No significant repairs - ie no new boiler etc. New fence at £700 and the usual gas, electric checks.

Not going to pay for my Ferrari AND recoup my deposit is it? I’m reliant on capital growth, which is not guaranteed and not unique to landlords.

dinohat no, they really don’t. Every bank has their own lending criteria, and some will not give you a mortgage with the best interest unless you have an excellent credit score. I’ve had experience of that which is why I had to rent for a few years. Eventually got a mortgage through a broker.

Owning a buy to let I would imagine is often a huge hassle, not least when the tenants do a runner, don't pay the rent, destroy the place or leave a complete and utter mess. It's not something I'd go into lightly.

House prices are also so high that once the mortgage, plus insurance and any work that needs doing is done I doubt there is often a huge amount of profit left over - although obviously it is a way of investing savings and making a bit of money when that money will make nothing in the bank and stocks and shares are so unpredictable.

You just sound bitter to me though OP.

Where are the people who can't get a mortgage supposed to live?

Not everyone wants to own.....some people want to rent.

Stop hating on people because of your own circumstances.

I agree
How is it any different than private school ,how is that allowed ,it is not the childs fault the parents don’t have money for the best school
Education and housing are basic rights ,people should have equal opportunities and no one profit from either

@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?

Interesting argument - and actually perhaps they should be.

@RickiTarr I don't need to look it up thanks. I know the difference.

How patronising to assume that someone who doesn't agree with your argument doesn't 'understand'.

The point I made to you has nothing to do with profits or profiteering.

@beingsunny

I'm a landlady, and I'm a good one.

I live in one of the most expensive suburbs in my country, I don't want to move as my sons father owns his home just round the corner here.

I've been in my rented apartment 8 years.

If I were to buy this place the repayments would be more than double what I pay in rent.

It doesn't make sense for me to buy here and stretch myself.

So I bought an investment property in a cheaper city. I have a single dad and his teen daughter and their dog living there, after mortgage payments, repairs etc in usually around £2000 out of pocket a year.

I'm hoping that as they improve infrastructure in that area the value will increase and I can sell and afford to buy a home for my son and I in the suburb we want to live.

What's wrong with that?

I don’t think there is anything wrong with this. I have friends with inherited property that they rent out at a fair rent, the houses are well cared for, the tenants are people who would not be able to get a mortgage and need a rented home. I lived in a rented house in London owned by a man who had moved back to his home town. He was a great landlord, the rent was reasonable, the house cared for. He was really decent bloke. I also had some horrible and greedy landlords, flats with dangerous gas, flats with terrible damp, no heating, all sorts of major issues, so I look back and still feel grateful for that one really kind landlord.

historically a proportion of people who got into buy to let did so as an alternative to the pension arrangements they had which turned out to be very volatile unpredictable and left them without any plan for retirement. Of course it escalated beyond that for many.

The benefits bill is going to be interesting when all those renters “retire”.

There has to be good rental property available. I rented in London for over 30 years. I had to live somewhere and I never bought into this UK obsession with "getting on the property ladder". I also needed to live in London for work and did not want to pay the price I would have had to pay to get the kind/size of house I needed. (I have recently bought property for the first time ever, not in the UK, at the age of 57).

@jasjas1973 why is your DD losing out to a cash buyer? If she has a mortgage offer in hand, it makes no difference to the vendor as long as the sale goes through and for a first time buyer with their mortgage offer at the ready, there ought to be no delay.

Owning a buy to let I would imagine is often a huge hassle, not least when the tenants do a runner, don't pay the rent, destroy the place or leave a complete and utter mess. It's not something I'd go into lightly.

None of those hassles justify any remuneration. Being called in the early hours cause your tenant has flicked the switch off the boiler and needs a shower before work, has a leaky sink (removed the pipes from under the sink because it was blocked - so it was a bloody big leak), trashed a house in 12m which needed a complete refurb (and holes in the ceiling replacing) as they drove off in their brand new Mercedes, calls re domestics - my ex gf is climbing through the window can you tell her that’s not ok?

I have some great stories, but mostly, I lie in a bath of cash relaxing and bidding outrageous prices for houses safe in the knowledge that a poor, poor poster here will pay well above market rent and recoup my investment in no time.

We also have the pattern of NIMBYism over planning
NIMBYs are not the issue. The real problem is that there are no laws restricting what developers are allowed to build. My town has a real need for small 1-2 bed properties for FTB. But when a large plot of land became available the developer chose to build 4 bed detached houses, which were occupied by people who moved in from outside the area because they were too expensive for local residents to afford. We formed a residents group and complained that we didn’t want big houses on that site, we wanted and needed 1-2 bed properties, and that site could provide 150 small properties instead of 50 large ones. But the council said it’s out of their control - they can only say yes or no to a developer’s plans, they can’t tell them what they have to build on privately owned property. A development has to be 10% “affordable” properties but that’s all. So the real issue here is that developers should be forced to build the property types that are proven to be at a shortage, they shouldn’t be allowed to build the type of houses that aren’t in short supply (but which generate a bigger profit).

I don't own a buy-to-let property, so that pat of this scenario is purely hypothetical, but let's imagine I did:

My DP and I are both freelance in not very high-paying industries, and therefore our incomes are precarious. Our buy-to-let gives us an added stream of income. We let at reasonable rents and are stringent about upkeep and fixing problems promptly and properly. We fully comply with all housing and rental laws.

Why is that so terrible compared to the house we own being lived in by 'a nice young family'? (and why do you feel 'nice young families' are so especially deserving?)

Our was the only way to move house, selling would have created a chain. We took money out of ours instead and rented it. There’s a big shortage of rental property where we are so it’s not a bad thing.