If you were buying a property as an investment, would you buy in Stratford, London. Or elsewhere in London?

[WellTidy]

We have about 170K to invest, and, with a buy to let mortgage, can borrow about 350K or so more. Stratford sprung to mind as it already has good transport links (with Crossrail to come), Westfield and the Olympic Park on the doorstep.

We are looking to buy a flat that will rent out easily, with potential for capital growth. We don't really have time for maintenance, and don't live that locally, so we would be looking to buy new and are happy to pay the service charge.

Would you buy, say, this flat for 500K, two bed two bath, views towards Westfield and the Olympic Park?

We are also toying with buying something at around the 350K mark instead in the Royal Artillery complex near Woolwich, again as an investment, but we would have to rent it out. Any views on the investment potential for that? Crossrail is due to go there, and the cable car is already there.

Or, finally, we are considering buying two flats near where we live in the south east, at about 250-300K each. I don't think they would appreciate hugely as there is no investment coming into the area, but they would definitely rent out easily and we would be on the doorstep for maintenance and repairs.

But then Lewisham is due to have huge capital investment, and maybe that would be a good area to buy a new flat in too ...

"Cactus" "Annie": "The funny thing is that people like you are so deeply selfish and self-centred that you cannot imagine that someone might be opposed to something on principle and not because it might be profitable (or unprofitable) for them personally."

Thank you for this comment. I find it extraordinary too, this. (And it's a very widespread attitude). People also vote in this way, sadly: directly on the basis of what's financially beneficial to them personally, and ignoring any possible principles (which they don't have at all? or don't consider? etc)

I will however attempt a short response to one point "Sunnyshores" made. Yes, Sunnyshores, it is indeed conceivable that if buy to lets were actively discouraged & taxed appropriately, if rents were capped, if perhaps (god forbid for home owners!) interest rates went up a bit, if houses were built, if taxes were fairer (a whole other discussion) then perhaps yes houses to live in would become affordable again. At the moment I do feel London has become something like a playground for the super-rich, a sort of tax haven of a kind. Just look at our corporate tax which is super low, at the same rate of Luxembourg etc.

OP, if you haven't already had enough; forget it on here. Too many are swallowing the 'it's all the fault of the landlords' line from the politicians and there are a lot of people who plain can't accept that others have more money than they do. You've got more money than I have, good luck to you - why would I be jealous, I'm not in primary school!

try the landlordzone forum; they also come down hard on bad or clueless landlords but provide sensible support, help and advice for good ones or those that want to be good ones. You'll also see a lot of what can happen if you get rogue tenants; a concept that many on mumsnet cannot understand.

OP - or property tribes has grown up people on it too. If you do decide to BTL then you should join the NLA (National Landlord Association) for training and legal advice because despite what people think you dont just buy a house and sit back counting your millions.

I inherited a small flat and was a landlord for a while, a good caring one I hope. I am now selling it and would much rather invest the money in an account and get the interest- less hassle and actually I do feel very bad about depriving someone of a home. BUT as others have said; its the system that's at fault- interest rates are so low I couldn't survive on them so BTL is the only way I can make enough to survive on. I do work, but live in an area with few jobs mostly low paid and seasonal, I am single having flad an abusive relationship and have bills to pay related to that with only a temporary job. So I so plan to BTL to survive. By doing so, I can pay my own way not use up my savings then rely on benefits. I will be a good landlord and will feel guilty if that helps? By the way for the OP I would not buy leasehold it can be a real nightmare, free hold is a much safer bet.

providing housing at a charge and a profit is immoral? Only on mumsnet would this insane statement be made. I repeat - do you work for free?

what do you live in - a mud hut you built yourself? Never paid a mortgage? Never paid any rent? Do you expect all the other essentials of life to be free?

communist countries are available. For the hard of logical thinking.

at specialsubject. Dear oh dear.

Indeed

I find it quite strange that making a (calm / rational) point that the huge increase in buy to lets may have some negative consequences is equated to 'wanting everything for free' / 'working for free' / 'being a child' / 'belonging to a playground' / 'not being a grownup' / 'yearning for communist countries' etc.

In my view buy to lets are not immoral (what does that even mean?!). They become a problem though when they are very widespread, not taxed appropriately & when there's not enough affordable housing for ordinary people. That's the issue really.

I look forward to a reasoned statement why renting property for profit is immoral, whereas selling mortgages at a profit is not.

I don't see mortgage-seller hate. (nor would I want to).

do explain. Tempting as it is to hide this vicious thread, I am listening.

I second the suggestion of Brockley , New Cross /Telegraph Hill area.

Its letting not renting The tenant rents

I think you could actually make a reasoned argument that selling mortgages during a time of massive house price inflation is immoral. If let's say I bought a car for £2k and then later persuaded some young person to pay me £20k for the exact same car, most people would consider me an immoral conman. But if I do it with a house, then it's considered a normal thing to do and the kid is praised for making a wise investment.

Or, as shelter is something we can't really live without, maybe a better comparator would be food. Let's say I buy some canned food in a time of plenty when food is cheap. Then I wait until bad weather hits and food becomes very scarce, and people are starting to starve, and then I say, 'Hey, I'll sell you my canned food, but only for 20x what I paid for it. But don't be immature and accuse me of being immoral, because of capitalism and shit. If you want to judge me, go live in a communist country."

Now, don't get me wrong, when I sold my last flat, I sold it at a profit. But then I also did feel morally ambivalent and rather guilty - I didn't view it as a totally morally neutral act. I recognised that I was making a profit from the fact that I happened to have been born a few years earlier than the people I was selling to, and I happened to buy my home during a time when shelter was a little less scarce and over-priced. I'm making a profit from other people being less fortunate than me.

If you're engaged in BTL in London, you have to have some moral awareness that you are profiting from a dire scarcity of an essential human need. In other parts of the country, where housing is less scarce and the landlord and tenant have a more equal relationship (i.e. tenants are less desperate for somewhere, anywhere, to live), then it's less morally dubious. If you make the place you buy a really lovely place for your tenant to live in, and don't profiteer by raising the rent every six months, then it's obviously less morally dubious. But with a housing shortage like ours, where most people who want to buy a home can't afford one let alone two or three houses, and that's mainly because they were born into the wrong generation, it's never going to be a totally morally neutral act.

The bottom line is why oh why won't govs build houses (or give incentives to encourage it) - disgraceful really.

SpecialSubject, I also just now explained my thoughts on this too: "In my view buy to lets are not immoral (what does that even mean?!). They become a problem though when they are very widespread, not taxed appropriately & when there's not enough affordable housing for ordinary people. That's the issue really."

And CunningPlan (and the others) gave reasoned arguments too. You don't have to agree with them. But they are arguments, ideas, nothing to do with playgrounds & being jealous / immature. It has to do with different beliefs on how we want our society to be.

So there you go, you have a few answers to your question.

I'm not entirely angry at landlords though it's not their fault that markets value rise in areas like London it's supply vs demand plus the fact that it's a popular place to live

Unfortunately people will pay a premium to live in London it's a world capital and I certainly would not expect my 3 bed in Birmingham to be worth as much as the same in London... I guess people need to consider other areas of the UK which actually are still very affordable if London prices are out of reach as

Yes landlords do have something to answer for but the real problem is the foreign buyers who are buying property with no intention of renting out just sitting empty eating up the housing stock and pushing up demand! These people buy cash and can pay over the asking price even if it is currently not worth that amount and normal people can't get a mortgage for more than it's worth. It is people like this who need to be targeted they have no intention of living in london or being Londoners. I do love London but I'm so angry with what they have done to the city I will always call home the housing situation is disgraceful

Did you see a programme where new housing was being built in London but they were targeting foreign investors not real people... It's shameful

Cactus - I think you are simplifying things a little. Most homes I buy are either empty or in huge disrepair. I bring them up to standard and mainly sell them. When I sell them it is nearly always to families with young children who are wanting a home that is move in ready. I do rent out some. In nearly every case the family receive benefits they wouldn't receive if they owned. One family I rent to have a very disabled child and the converted pub offers was built to their needs. I also sold a modified home to another family with a disabled child.

I don't need to buy these properties but if I wasn't buying them and renovating them the homes would be falling into further disrepair and it wouldn't benefit anyone.

Also I do have a problem with the laws and regulations in the UK around housing. Not one political party has addressed the huge housing crisis that the UK faces. I do have a problem with foreign buyers coming in and buying up our country. Try buying in NYC or San fran without a business visa and see how far you get. Trying buying in China!

I'm all for globalization but let's have a level playing field. One huge problem are variable rate mortgages. It is a disgrace that you can't get a fixed rate mortgage for the term of your mortgage. The central bank could issue fixed rate Gilts just like the US and Canada. Instead the UK has to copy the worst aspects of the housing policy here in the US and allow stupid and idiotic mortgage practices to continue.

I also ask about the moral hazard of allowing someone whose housing is subsidized by the government being able to buy their home. For me home ownership is a privilege and if your can't afford your rent I don't think it is smart to allow these people to buy a home. I say this not because I don't care about those who need support but because I know just how expensive maintaining a home is.

Catford is about to have huge regeneration.

All this 'such and such is on the up' and 'so and so is about to boom' is probably bollox.

I buy and sell shares occasionally and the minute it is reported that something is a good buy or a share is tipped by an expert you've missed the boat by a mile.

True, property moves more slowly (but then it takes a mouse click to buy shares) but you only get a bargain if you grab it BEFore everyone else not once they've already got on the bandwagon. Because then you are just feeding the frenzy which will burst sooner or later.

I do give a damn about non British citizens buying a property in London just because they have the money. Many countries have sensible policies in place where you cannot buy unless you are a citizen/Permanent residence, not just whether you have the money. Why should the locals have to compete with the global super rich elite for houses, not just other citizens, with prices driven up to insane levels.

It angers and sickens me when I see advert in Asian or Middle East versions of the Financial Times and other lifestyle magazines marketing London/uk properties directly to the international super rich.

Let's face it the conservatives or labour are gutless and won't do anything about the current price of houses, they don't want to be labeled the government which it all came crumbling down with. So as long as they can restrict new homes, sell off any remaining social council houses, prices will continue to rise/stay high. Patching the system with htb and low interest rates are a way look how good we are helping people getting on the ladder, but is actually just helping the wealthy at the other end, which surprisingly is probably some of the politicians. Vote in a loon party that will crash it all;)