The king and queen of buy-to-let, will they take Ashford in Kent with them as they fall?

[Upwind]

from today's Guardian:
"Judith and Fergus Wilson used cheap buy-to-let finance to snap up hundreds of homes, mostly around Ashford in Kent."

• They own more than 900 houses
• They will have single handedly pushed up the prices families paid for homes around Ashford
• They have started to sell now into a falling market and at realistic valuations, they can't be far from negative equity.
• As they specialise in small family homes, their selling off of stock mean that their tenants lose their homes
• If the Wilsons lose their big gamble, their tenants will suddenly be made homeless en-masse due to reposession, and through no fault of their own
• This big sell off will push down prices in the area
• From the article above they seem oblivious to the immorality of their own actions

who the hell lent them enough dosh to BUY 900 houses????!!!!

No wonder the banks are up shit creek...they are all equally culpable, and poor tenants!
Let's hope they can afford to buy the houses once they are forced to drop the prices...

As usual this country shits on the people who need housing by allowing the likes of these people to just throw in the towel and sod the tenant.

Brilliant policy of Maggies (sorry - blowing my anti Maggie stance now - sell off all the social housing - allow private landlords to take up the helm and fast forward 20 years - lo and behold a country which cannot provide adequate and affordable housing for the majority of people. Crap.

These two will sail off into the sunset without a backward glance - shame that their tenants will not be in the same position.

The article says that they are not planning on selling all at once, but slowly over the next few years, not starting until christmas time.

The argument that landlords would withdraw their properties from the market is not spurious. If you look at the history of the law of landlord and tenant you will see that this is precisely why the law was changed to give more rights to landlords.

Blimey have they got mortgages on them all - that is major leveraging isn't it!

I don't really understand the level of venom here as they have said that they don't intend selling straight away and I don't get the impression that they are going to put anyone out of a home, they are certainly not desperate to sell. If they have mortgages of 65% LTV or less they are making plenty of money on the rentals and don't have to sell anything, except anything hard to let or expensive to maintain. The fact that they've said they'll probably sell to first time buyers and not bulk investors is also fairly postive - they've announced their 65% average mortgages so potential buyers have more information available to them on their vendor's financial position than they normally would.

I am not local to Ashford but the press are responsible for a lot of the hype in the area, especially with the Eurostar, not just one property investor. Not defending them as I have no reason to.

I remember seeing a documentary about those two. They bought houses then bought more by remortgaging against the equity in the ones they already had. So they never actually paid any houses off, just took out more debt.
I thought they were quite revolting smug gits and was appalled at the way they literally bullied one seller into taking a lower price than he wanted, just because they wanted his house as they had all the others on his cul de sac.
If prices are dropping and I read correctly that their average debt to house is 65% then they must be shitting their smug little pants.
I bet all those remortgages are interest only as well.
Hopefully now some of their tenants will be able to get a bargain by making these two a low offer when they are desperate to sell.
I do remember on the documentary they kept saying that property ALWAYS doubles in price every 10 years and couldn't understand that comment as they are old enough to remember the last price crash.

they own the house next door to me. They are utter, utter scumbags.

Well, I agree about house prices doubling every 10 years. I remember the last price crash at the end of the 80s/beginning of the 90s. Studio flats then were going for about £45 - 50K. Prices crashed and they dropped to about £40K. You'd be hard pressed to find one these days for much less than £80-90K (at least in this area). Even if prices drop now to £70K, in a few years, I bet those flats will be going for over £100K.

I've heard they get an average of five parcels of shit per week.

Bet that figure will be the only increasing one in their lives soon...

"Well, I agree about house prices doubling every 10 years."

Unless pay doubles every ten years, this is wholly unsustainable. A house is only worth what someone will pay for it.

5 shit parcels a week? I will hold that cheery thought in my head tonight (while listening to the rats scurrying around in the uninhabitable dump of a building next door which they've allowed to lie empty for two years...)

Well, look at the evidence. My parents bought their first house in the 1960s for £3000. It is now worth £250-300K. I think that works out at more then doubling every 10 years.

Salaries do not have to increase in line. People have been willing to use more and more of their disposable income to pay for housing costs. When I got my first mortgage, the maximum that lenders would allow was 3 times your salary and most people thought that was pushing it. These days (well, until recently) they were lending up to 7 times the borrower's salary. If people are prepared to borrow that much, then house prices will increase. It probably is unsustainable in the long, long term, but historically it's been the case.

When the housing market last crashed about 18 years ago, many people said it was because house prices had reached the maximum that the market could sustain. Look at prices now. I had a house during that crash. Prior to the crash, it was worth £75-80K. After the crash, it was worth £50K. Today, it is worth £250K. And that's just in 18 years.

Freckle, there is a limit as to what people are able to spend on housing. Nearly everyone I know who is under thirty spends most of their take home pay on private rents or mortgages. You cannot keep increasing the amount that they have to pay => exponential growth in house prices relative to incomes is just not sustainable. At some point an equilibrium must be reached. If prices and rents were to rise much further we would be approaching a kind of slavery!

The Wilsons intend to sell up over 'several years', if you assume they want rid of 100 properties in Ashford each year, that in itself will dramatically increase supply in the area. 'Fergus is cautious about precise figures, but reckons his properties are worth "around £250m" and that the typical loan-to-value is around 65%.' If the 'value' of these homes drops due to the recession, combined with a sudden increase in local supply, the Wilsons might find that their portfolio is not worth what they think it is.

I agree that they will probably sail off into the sunset leaving a trail of misery behind them - it is the tenants and thwarted FTBs who take the pain. And the banks which were stupid enough to lend to these ignorant chancers.

Upwind, I don't disagree with you. I'm just pointing out what has happened historically. Some people seem to be so intent on getting on to the property ladder that they will commit ever increasing percentages of their income on housing. And a lot of that has been to do with irresponsible lending on the part of the financial institutions. If 100% mortgages 7x your salary were not available, house prices would have to slow or even start to drop.

Also house prices have been artificially inflated by the massive buy-to-let industry, including the Wilsons. Hopefully that market has reached saturation point or even the point where houses will have to be placed back on the market.

Prices doubling every ten years is very misleading though. Depends which ten years you pick! Ten years is no way 'long term'. Thirty years maybe. And of course you have to take into account inflation.

They do seem a little slow on the uptake: 'the party is over'. Er, yes... more than a year ago... didn't you notice all the lights were off and everyone else had gone home?

Freckle - it is one of my pet rants, unfortunately the media don't seem very interested in the predicament of tenants. They prefer to obsess about hard-working-home-owners.

southutsire - that is why I am fairly certain the Wilsons are screwed. They were still buying houses this year. Why suddenly change your mind and start selling up if you saw this coming? They claim that prices had not dropped much around Ashford, but that is because there was a pair of greedy people playing monopoly with the homes in the area and snapping them all up! When the same pair start selling the opposite will happen.

I remember seeing a programme featuring some of the tenants of this pair. Apparently they were making up any excuse not to hand back deposits when the tenants moved out and sometimes adding a "valeting" charge expecting the tenants to pay for cleaning up after them.

Only some of the tenants (this was more than one case, not linked other than having them as landlords) had proof that the houses were fine when they had moved out. They were being chased by debt collectors to pay these extra charges.

If that is how they want to make their money then on their consciences be it. And I think more people would feel happier renting rather than buying if there were secured tenancies.

TwoIfBySea - that is shocking. It makes me that the guardian article below is so sycophantic. They could have mentioned that programme at the very least.

I just did a search on google news to see if the Wilsons had been written up by anyone else recently. It seems they are getting out of the horse racing/gambling business too. From the sun: Fergus Wilson is quoted as saying "You wrote the first story about me in 1998 when I had £4,000 on at 250-1 that I would own a Grand National winner.

?I stood to win £1m but I don?t think it will ever happen. We will NOT be buying any more young horses. I always said I?d give it 10 years."

Wilson will go down in turf history as the owner who always aimed for the stars ... and seldom even saw his horses finish.

This year Wilson?s no-hopers have been the usual disaster"

Thye are about to get their come uppance

I always found it astonishing that this kind of thing could go on under a labour government- unlimited numbers of houses owned by individuals/one couple, vast swathes of countryside being concreted over for hideous new housing estates all so that one family can buy the lot (at discounted prices) rather than ownership being spread out amongst many stuggling young families.

Why didn't labour stipulate a limit on buy to lets, say a maximum of 100 properties or introduce punitive tax disincentives? It seems amazing that they have effectively allowed the equivalent of a modern day Duke of Westminster to emerge.

I do feel for Ashford. They have lost their green spaces forever, and also the international train service that underpinned this greed and nonsense.

And I do think that Margaret Thatcher takes a lot of blame for selling off our council houses. Better to have a decent supply of state owned social housing stock than pass ownership into the hands of a few immensely rich individuals devoid of social conscience.

(I speak allegedly of course and not referring to any particular individuals...)

Sorry, I take back what I said - I hadn't realised they were such bastard landlords.

Council housing ensured a secure tenancy in a decent house - thanks to Maggie (who not only sold them all off but also banned councils from using the profits from Council house sales to build any more houses) we (tax-payers) now fork out housing benefit to accomodate tenants in properties owned by the likes of the Wilsons. I cannot think of a policy more designed to exarcerbate the difference between the rich and the poor. Instead of our taxes being used to invest for the future with a decent stock of social housing it is lining the pockets of buy-to-let investers who have no obligation to their tenants. It's easy to criticise the Labour government because the chickens are coming home to roost on their watch, but this is the inevitable conclusion of a Tory policy applauded at the time by the many tenants who were able to pick up their homes for a song.

Lilian - It's easy to criticise the Labour government because they've had over ten years to do something about this and they have not. They made the buy-to-let explosion possible by deregulation of the banks and by allowing the credit bubble.

I've been told that Labour ministers are largely supportive of buy to let landlords like the Wilsons because a large number of them have been involved in it themselves. I guess it might be possible to confirm how true that is. The founders of the Labour party must be turning in their graves.

Point taken Upwind. I suppose what I meant was let's not pretend it would have been any different if Dave had been in charge. That's what is really depressing - there doesn't seem to be anyone qualified to get us out of this mess. I entirely agree with your final sentence.