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How does Buy to Let END!


macca

What happens when generation rent retire with tiny pensions and massive rent bills!  

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1 hour ago, spygirl said:

A combination of small number  of high value transaction and fibbing.

 

id say you are anti MSM and establishment, its not a nice look, just give in and go with it, your life will be so much easier as a drone/salivating moron.

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On 21/01/2021 at 17:32, spygirl said:

'My mortgage has risen 40pc': landlords hit as banks reevaluate city homes

Falling rents and shift from city centre living means London property valuers are spooked

https://www.telegraph.co.uk/property/uk/mortgage-has-risen-40pc-landlords-hit-banks-reevaluate-city/amp/

Can't believe his mortgage bills jumped by £500...yowzer.

image.png.da74ddc7c6f6f923abc049b775b517a0.png

image.png.c883fcbeb24480fa59f41f279166a301.png

 

was reading on the maint thread that 700,000 foreign nationals have left London/UK during covid.

image.png.d0b759f8a2fe371acc956871cd7b54bb.png

 

 

Edited by sancho panza
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1 hour ago, sancho panza said:

Can't believe his mortgage bills jumped by £500...yowzer.

image.png.da74ddc7c6f6f923abc049b775b517a0.png

image.png.c883fcbeb24480fa59f41f279166a301.png

 

was reading on the maint thread that 700,000 foreign nationals have left London/UK during covid.

image.png.d0b759f8a2fe371acc956871cd7b54bb.png

 

 

North - South split as far IO BTL goes.

North people have been buying on yield. If they get a tenant in then the return can be chunky.

However, good private tenants in the North  are few n far between.

Mostly theyve been buying up and letting to bennies, which comes with a whole host of problems that Mr n Mrs Middleclass cannot come to understand - 'They shat in the shower and sold the boiler?'

S24 totally fucks over leverage BTL with  a good yield - 30%+ of the rental income goes in tax - or it will be when they get the HMRC letter.

 

In London/Se people have been buying on the skimpiest of yields - sub 4%.

Sure, they might have a deep supply of tenants - mainly foreign.

Not only do they face ever more issues with 24 - same issue with HMRC taking 30%+ of rental income.

They also run a huge risk with voids.

First recession was going to finish off London/SE BTL.

Combine this with covid which has vanished tenants.

What London’s falling population means for the housing market An estimated 700,000 foreign-born residents have left the city since the Covid-19 outbreak — how will this affect rental and sale prices?

https://www.ft.com/content/517ff59b-16a4-4412-9798-d06268771797

 

Having 50% of the local population in rentals is going to make housing cycles very brutal on the down cycle.

Having 50% of local pop who are foreign and working in Pret .....

Most are on 1 months. When tenants get laid off they are unlikely to stay for even that.

MY argument on TOS has always been that IO lending does not belong in the regular banking system. It needs leaving to them to regulated sector - fin comps who sell bond to finance their lending, mainly at 3%month compounding.

UK Building societies , as was, and retail banks dont understand commercial lending which is what IO BTL is.

The BoE should have moved much faster to get all the IO BTL off the regulated banks books.

I dont follow London prices.

As far as I can tell theyve been falling for a good 5 years. Not huge, just working their way down.

The  market of v expensive houses selling in prime London is giving Mr n Mrs Chapati  in Acton a false sense of confidence.

 

 

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43 minutes ago, spygirl said:

dont get it? is this how that BTL ended do you mean?

anyway, cheek of the gazette calling it a dingy flat, when its prime much sort after designer flat for the professional about town.

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  • 4 weeks later...

London landlords feel the burden of buy-to-lets

The pandemic has delivered a blow to this once-thriving market

https://www.ft.com/content/cd12e80d-927b-4024-bf9c-49ee0fd7c042



When he finally sold his London rental property in December, Philip Cooper couldn’t wait to get rid of it. For nearly three years he was a buy-to-let landlord while running his own marketing consultancy. In that time, a combination of increased mortgage costs, tax changes and swingeing estate agents’ charges turned the experience from an appealing economic prospect to a stressful money pit. “Eventually it was costing us money every month. The mortgage costs had gone up, the tenants were more demanding. I sold a bit below market price; I just wanted to have shot of the stress. You would be mad to get into buy-to-let in London today,” he says.

...

Some landlords have decided to slash their prices. Cooper’s wife owns a two-bedroom rental flat in Clapton, east London, where she once lived. When her tenant left in February 2020, she dropped the rent from £2,150 to £1,600 a month and still took two months to find a replacement. “It was incredibly stressful,” says Cooper.



In recent years, tax breaks for landlords have been steadily reduced. Between April 2017 and April 2020, the amount of mortgage interest that landlords could deduct from rental income before paying tax fell from 100 per cent to zero, replaced with a 20 per cent tax credit on mortgage interest. For Cooper, a higher rate taxpayer, the shift wiped out nearly all the profits on his west London house. “I was paying 45 per cent [tax] on the rental income: even with the mortgage tax credit, I was barely washing my face.”

James Cash, a communications consultant, who sold his two-bedroom flat in Clapham, south-west London, in September after 15 years as a landlord, had a similar experience. “The margins got smaller, the cash flow wasn’t nearly as good, and there has been less money to put back in for renovations,” he says. “It became the bane of my life the last couple of years. It wasn’t really making any money.”

 

Only thing to add is that these will be on IO mortgages.

At some point all the IO BTLs are going to be shifted off regulated banks and into the unregulated fiances sector.

Or moved to a 15 repayment commercial mortgage.

AFAICT London prices have been falling  for ~5-6 years.

Covid has to have hammered demand/prices - see void rental comment.

 

 

 

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9 hours ago, spygirl said:

London landlords feel the burden of buy-to-lets

The pandemic has delivered a blow to this once-thriving market

https://www.ft.com/content/cd12e80d-927b-4024-bf9c-49ee0fd7c042



When he finally sold his London rental property in December, Philip Cooper couldn’t wait to get rid of it. For nearly three years he was a buy-to-let landlord while running his own marketing consultancy. In that time, a combination of increased mortgage costs, tax changes and swingeing estate agents’ charges turned the experience from an appealing economic prospect to a stressful money pit. “Eventually it was costing us money every month. The mortgage costs had gone up, the tenants were more demanding. I sold a bit below market price; I just wanted to have shot of the stress. You would be mad to get into buy-to-let in London today,” he says.

...

Some landlords have decided to slash their prices. Cooper’s wife owns a two-bedroom rental flat in Clapton, east London, where she once lived. When her tenant left in February 2020, she dropped the rent from £2,150 to £1,600 a month and still took two months to find a replacement. “It was incredibly stressful,” says Cooper.



In recent years, tax breaks for landlords have been steadily reduced. Between April 2017 and April 2020, the amount of mortgage interest that landlords could deduct from rental income before paying tax fell from 100 per cent to zero, replaced with a 20 per cent tax credit on mortgage interest. For Cooper, a higher rate taxpayer, the shift wiped out nearly all the profits on his west London house. “I was paying 45 per cent [tax] on the rental income: even with the mortgage tax credit, I was barely washing my face.”

James Cash, a communications consultant, who sold his two-bedroom flat in Clapham, south-west London, in September after 15 years as a landlord, had a similar experience. “The margins got smaller, the cash flow wasn’t nearly as good, and there has been less money to put back in for renovations,” he says. “It became the bane of my life the last couple of years. It wasn’t really making any money.”

 

Only thing to add is that these will be on IO mortgages.

At some point all the IO BTLs are going to be shifted off regulated banks and into the unregulated fiances sector.

Or moved to a 15 repayment commercial mortgage.

AFAICT London prices have been falling  for ~5-6 years.

Covid has to have hammered demand/prices - see void rental comment.

 

 

 

On the basis of the broken clock fallacy you will be right one day regarding the death of BTL. 

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3 minutes ago, Hancock said:

On the basis of the broken clock fallacy you will be right one day regarding the death of BTL. 

Explain?

Io btl was fucked as soon as s24 came out in ~2015ish.

It's a matter of waiting and watching btlers get their HMRC letter.

 

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18 hours ago, spygirl said:

Explain?

Io btl was fucked as soon as s24 came out in ~2015ish.

It's a matter of waiting and watching btlers get their HMRC letter.

 

IO BTL will not be so appealing should they bring in S24 for all taxpayers. 

Since S24 came in people have still poured money in, and prices have gone insane.

The wait has been 7 years since s24 came in, it is one long wait.

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11 minutes ago, Hancock said:

IO BTL will not be so appealing should they bring in S24 for all taxpayers. 

Since S24 came in people have still poured money in, and prices have gone insane.

The wait has been 7 years since s24 came in, it is one long wait.

Because they haven't clicked they owe tax ffs.

S24 has only just been fully rolled out in 2020.

It was a year or so in planning, 2 years to get the laws down, then first stage in 2016ish.

Io btler lie about how much they make.

90% of btl have not declared their rental income.

Once you start seeing the stories of LL selling up the OO to pay tax bill.

S24 is only the start of LL problems. Any btler who's been withdrawing equity and still claiming it relief is in expensive shit.

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43 minutes ago, Hancock said:

Hence why S24 isnt the wonder policy it was deemed to be on HPC many years ago.

 

It's a marvellous policy ffs.

It wanjers the overleveraged io idiots.

The charge / tax owed does not disappear.

 

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1 hour ago, spygirl said:

 

The charge / tax owed does not disappear.

 

HMRC will never search for the vast majority of the tax from the 90%.

Im not knocking it, but it should have been brought in instantly and applied to every tax payer.

(so i am knocking it)

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40 minutes ago, Hancock said:

HMRC will never search for the vast majority of the tax from the 90%.

Im not knocking it, but it should have been brought in instantly and applied to every tax payer.

(so i am knocking it)

They will get everyone owing more than ~5k

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37 minutes ago, spygirl said:

They will get everyone owing more than ~5k

They wont as the money is undeclared, it would cost too much to even go after 10% of them let alone all of them.

 

and i pulled 10% out of the air.

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3 minutes ago, Hancock said:

They wont as the money is undeclared, it would cost too much to even go after 10% of them let alone all of them.

 

and i pulled 10% out of the air.

All house owners are registered.

All mortgages are registered.

All transfer of money is registered.

Electoral roll is recorded.

Credit card n transactions are registered.

HMRC can access all these.

You can track assets n money flow.

If you think not declaring rental income protects you from HMRC then you are smoking crack.

If you want to hide assets from HMRC you need to be buying gold n burying it in the garden.

Buying a house, with a mortgage, then putting tenants in is 100% visible to HMRC.

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3 minutes ago, Hancock said:

They wont as the money is undeclared, it would cost too much to even go after 10% of them let alone all of them.

 

and i pulled 10% out of the air.

Do you really think it's expensive to run a report and generate a set of letters asking for a large amount of money?

Trust me it really isn't HMRC will have the letters ready to go in April..

 

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Just now, spygirl said:

All house owners are registered.

All mortgages are registered.

All transfer of money is registered.

Electoral roll is recorded.

Credit card n transactions are registered.

HMRC can access all these.

You can track assets n money flow.

If you think not declaring rental income protects you from HMRC then you are smoking crack.

If you want to hide assets from HMRC you need to be buying gold n burying it in the garden.

Buying a house, with a mortgage, then putting tenants in is 100% visible to HMRC.

Agency reporting rules means HMRC also know how much letting agencies are transferring to landlords.

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Just now, eek said:

Agency reporting rules means HMRC also know how much letting agencies are transferring to landlords.

Solicitor have to inform HMRC if they believe any tax is due on a house sale.

 

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2 minutes ago, eek said:

 

Do you really think it's expensive to run a report and generate a set of letters asking for a large amount of money?

Trust me it really isn't HMRC will have the letters ready to go in April..

 

The money is in essence cash in hand.

If HMRC could have got it, why are the leaving it for many years into the future.

I remember this was debated on on HPC many years ago, yet still HMRC are biding their time.

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4 minutes ago, spygirl said:

All house owners are registered.

All mortgages are registered.

All transfer of money is registered.

Electoral roll is recorded.

Credit card n transactions are registered.

HMRC can access all these.

You can track assets n money flow.

If you think not declaring rental income protects you from HMRC then you are smoking crack.

If you want to hide assets from HMRC you need to be buying gold n burying it in the garden.

Buying a house, with a mortgage, then putting tenants in is 100% visible to HMRC.

I have never said not declaring income protects you from HMRC, why come out with such utter bollocks.

You people claimed many years ago on HPC that HMRC could ever so easily get this money.

Yet still all these years later they have not. 

Must tell you something.

 

 

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4 minutes ago, Hancock said:

I have never said not declaring income protects you from HMRC, why come out with such utter bollocks.

You people claimed many years ago on HPC that HMRC could ever so easily get this money.

Yet still all these years later they have not. 

Must tell you something.

 

 

HMRC have got these people.

Before s24 it was possible for a io btl to have a low tax liability.

The leverage on io btl is do extreme theres normally only £50 margin between rent n mortgage payments.

Bringing in s24 kills that.

All io btl mortgages now have a tax liability.

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