To think rent is so bloody unfair

[Tar19891]

My rent is 800 per month. A mortgage on the same value flat would be 450 per month. Not in London obviously. It’s not fair is it?

the whole problem started when Thatcher’s government started to sell off council housing, THAT’S what’s at the root of the current housing problem

Yup.

@JudgeRindersMinder

This won’t be a popular opinion but a lot of people don’t help themselves by renting having kids before they’re financially stable then they get caught up in the whole cost of childcare nightmare, often struggling to make ends meet, never mind having anything left over to save. If a lot of people were a lot more financially savvy and didn’t dive out of the family home into a rental at a very young age, but did it the “old fashioned way” and worked and saved while living with parents it’s do-able.

And before anyone jumps on me with their whatabouttery and “ I was thrown out at 16”, yes I’m well aware that happens in SOME families, but they are very much in the minority. People generally have more choices in life than they’ll admit on here

I hate to say it, but I agree. I was one of those booted out at 16. No choice in it really, but almost 16 years later, I can certainly see that there are opportunities I could have taken which mightve put me in a better position in the following years.

The figure I ‘made up’ was comprised of two official data points - the number of residential households privately renting, and the average rent.

Do you or do you not agree that a very educated guess on, at the very least, the range of revenue raised can be gauged from those figures?

Oh @SwanBuster

It's getting late, and my addled brain is struggling. But so far as I can see, if we accept your figures they put the turnover for the PRS at £54bn. If it's paying £7bn tax on that turnover I'd say that's a large amount. The cost of its capital must be enormous. And there are plenty of other costs. If it was earlier I would do a spreadsheet and Google a comparator. But £7bn (or possibly £2bn) tax on that turnover seems pretty good to me. And I'm still baffled therefore by the peanuts claim.

And thank you for you suggestions. HM Treasury may well read! I was interested in specific suggestions to the way landlords are taxed. I think (as explained above) that their taxation is penal, in ignoring the cost of capital, which I suspect is where you're going wrong too. (And politically motivated, I saw that as the first move towards populism - I'm sure there'll be more!).

@BoredZelda - I rented out my flat as well while I worked elsewhere (renting a property there). Overall I made something similar to you. Better for my property to be rented out in that situation than to lie empty (especially as j needed somewhere else to live so had to rent where I was working

“ I absolutely agree that there’s nothing wrong with renting, the whole problem started when Thatcher’s government started to sell off council housing, THAT’S what’s at the root of the current housing problem”

That kicked it off, but it’s only one part of the story. New labour pumped the market too. In the mid 90s housing was very affordable relative to incomes. Then came a financial crisis which was an opportunity for a reset - which Brown decided to ignore and bail out debtors on.

Then just as things were starting to stabilize, George Osborne decides to go full idiot and stole another boom with the catastrophically cynical help to buy scheme.

And then just as we have a pandemic, another opportunity for a reset - world government/central banks prints trillions. And In the Uk - Sunak adds a little cherry with the stamp duty holiday.

Remember - this government deemed it acceptable in the midst of the hardest parts of lockdown to go and view homes. You couldn’t exercise in a local park for more than an hour, but you could legally drive from lands end to John o groats to buy a second home.

This tells you all you need to know.

@swanbuster, you conveniently forget that whilst most can pay 5-10 percent deposit the minimum a btl investor can pay is £25 percent deposit and many do pay repayment mortgages or a mixture of both within portfolio. They do get capital growth but will pay capital gains tax on appreciation when they come to sell.

There is something badly wrong with the UK housing market, when a young couple can't buy a home. But they can pay to buy somebody ELSE a home.

We can end the thread with this. Bravo.

Further flawed thinking

They do get capital growth but will pay capital gains tax on appreciation when they come to sell

At a very low rate and tapered.

@SwanBuster your figures are made up. They don’t make any sense.

@LardyDee

The figure I ‘made up’ was comprised of two official data points - the number of residential households privately renting, and the average rent.

Do you or do you not agree that a very educated guess on, at the very least, the range of revenue raised can be gauged from those figures?

Oh @SwanBuster

It's getting late, and my addled brain is struggling. But so far as I can see, if we accept your figures they put the turnover for the PRS at £54bn. If it's paying £7bn tax on that turnover I'd say that's a large amount. The cost of its capital must be enormous. And there are plenty of other costs. If it was earlier I would do a spreadsheet and Google a comparator. But £7bn (or possibly £2bn) tax on that turnover seems pretty good to me. And I'm still baffled therefore by the peanuts claim.

And thank you for you suggestions. HM Treasury may well read! I was interested in specific suggestions to the way landlords are taxed. I think (as explained above) that their taxation is penal, in ignoring the cost of capital, which I suspect is where you're going wrong too. (And politically motivated, I saw that as the first move towards populism - I'm sure there'll be more!).

It is late - but you and I will never agree on this, so let’s leave it. That said, my brain isn’t struggling whatsoever so there little point in discussing it if you can’t produce your own estimates.

I will never agree that housing benefit should primarily be a conduit to funnel money to landlords - even if by some inexplicable maths the tax revenue exceeded it (which we can all agree, it won’t).

@Blossomtoes - taper relief for cgf is long gone

[quote Villagewaspbyke]@SwanBuster your figures are made up. They don’t make any sense.[/quote]
Bullshit they are. They are based on two official datapoints which you can easily extrapolate an educated range from.

Do better.

CGT not cgf

[quote Villagewaspbyke]@Blossomtoes - taper relief for cgf is long gone[/quote]
Good.

@LardyDee

There is something badly wrong with the UK housing market, when a young couple can't buy a home. But they can pay to buy somebody ELSE a home.

We can end the thread with this. Bravo.

Further flawed thinking

Erm - You agreed with PigletJohn’s post being a succinct summary, but if I agree with it it’s flawed thinking?!

Bizarre.

@SwanBuster you do better. They’re not any justification for anything you’re trying to say which seems to be some sort of big business conspiracy theory.

I am a landlord. I don't have a mortgage on two of the places I rent out...

I'm not wealthy

I don't have words. Please read the thread about the woman having a cry in Asda because she can't afford discounted baked goods. Owning MORE THAN TWO properties is fucking wealthy.

I'm genuinely stunned.

@Tar19891

Plus the landlord is building equity. Come on, we’re all adults as you say. Just admit to profiting off the situation

Landlords will profit in the long run. Maybe. Depending how long they let something for. Assuming the person renting pays every month and is looking after the property to a extent.

@Blossomtoes - yip no argument there but the point is that the thing you said about CGT being “highly tapered” was a lot of old rubbish.

[quote caringcarer]@swanbuster, you conveniently forget that whilst most can pay 5-10 percent deposit the minimum a btl investor can pay is £25 percent deposit and many do pay repayment mortgages or a mixture of both within portfolio. They do get capital growth but will pay capital gains tax on appreciation when they come to sell.[/quote]
And you conveniently leave out that landlords - as was stated on their thread earlier - often remortgage their existing home or buy to let to raise that 25% deposit. We can both play this game.

@SwanBuster there was idiocy from lenders in the south east way before new Labour. In the 80s banks were lending massive multiples 5,6,7 times) people’s PROJECTED salaries I. In 10 years time they reckoned a person would earn eg £50k, so they were lending on multiples of that rather than their ACTUAL salary which was maybe only £25k. This is when property prices got really stupid, way before new Labour was a twinkle in anyone’s eye, Although I don’t disagree they compounded the previous financial idiocy

[quote Villagewaspbyke]@SwanBuster you do better. They’re not any justification for anything you’re trying to say which seems to be some sort of big business conspiracy theory.[/quote]
I don’t need to. I’m right, and you’re just posting trite remarks.

Cannot say I am surprised at the lack of macro finance and economic understanding coming from the landlord crowd on here.

UK has a very poorly educated 40+ population.

Its the younger cohorts that see the scam for what it is.

[quote JudgeRindersMinder]@SwanBuster there was idiocy from lenders in the south east way before new Labour. In the 80s banks were lending massive multiples 5,6,7 times) people’s PROJECTED salaries I. In 10 years time they reckoned a person would earn eg £50k, so they were lending on multiples of that rather than their ACTUAL salary which was maybe only £25k. This is when property prices got really stupid, way before new Labour was a twinkle in anyone’s eye, Although I don’t disagree they compounded the previous financial idiocy[/quote]
That got corrected 1989-1994 - at least with respect to salary multiples.

@Time0FtheQuest

It is not about Fair/unfair Right/wrong People have a choice, they can rent or buy Both have positives & negatives

I rented for 10 years, moving once or twice a year
Saved up & bought
Yes, I made sacrifices, but I had a goal at the end

If you want to buy, make the choice to do that

Quite right. Simply choose to be rich and privileged. Make that your goal. Foolish peasants.