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IGNORED

How does Buy to Let END!


macca

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

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Wight Flight
1 hour ago, Herby said:

Some interesting noise in the landlord world relating to increases in insurance to cover non-payment..

https://www.propertyreporter.co.uk/landlords/rising-demand-for-landlord-insurance-highlights-concerns-in-the-btl-market.html

New data from Quotezone.co.uk highlights an increase of 37% in demand for landlord insurance in the first quarter of 2022, compared with the same period last year. Landlords are rushing to ensure they have additional income protection as they are hit by the highest buy-to-let interest rates in seven years, on top of an increase in buy-to-let tax bills, as they can no longer claim the tax back on mortgage repayments.

Yes. A lot of them are saying they are going to sell up because the government interference makes it unprofitable.

In reality they overpaid for properties, leading to very low yields which is the Real reason it became unprofitable 

That 4% yield isn't going to look too clever with rates at 6%.

 

 

Edited by Wight Flight
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Wight Flight
2 minutes ago, sarahbell said:

It will also be easier for tenants to share their homes with much-loved pets, with all tenants having the right to request a pet in their house. Landlords must consider these requests, and cannot unreasonably refuse.

This is excellent news for me. Landlords hate tenants having pets. What we all know will happen is on the initial application the form will ask if you have pets. Anyone who says yes will get binned.

People will wake up to this and tick the no pets box, then ask for permission as soon as they move in - which cannot be reasonably refused.

I will ensure that I note on my form that I am allergic to all animals, letting the LL know that I won't ever be seeking a pet. Every little helps.

 

 

 

 

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2 hours ago, Wight Flight said:

The current two months just leads to problems. Most properties here are advertised more then 2 months in advance and snapped up immediately. Therefore it you receive 2 months notice, almost everything you could move to has already gone. 

You either become homeless or refuse to move out.

You'd be entirely within your legal rights as a tenant to remain past the end of the S21 notice as long as you keep paying rent, expiry of the notice just means the landlord can start court proceedings to evict. But most private tenants (and no doubt most landlords and letting agents) will not be aware that this is how the law works, plus most tenants will have never done anything wrong in the eyes of officialdom in their lives and will find the idea of being taken to court highly intimidating, plus they won't want the possibility of a bad reference to make it harder to find housing in future.

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2 hours ago, sarahbell said:

https://www.rightmove.co.uk/news/articles/property-news/renters-reform-section-21-to-be-banned-england/

Under the bill, Section 21 evictions – also known as no-fault evictions – will become illegal in England, and landlords will need to provide a reason for reclaiming the property. Section 21 evictions are already illegal in Scotland, while Wales and Northern Ireland are looking to extend no-fault-eviction notice periods.

It will be illegal for landlords to impose blanket bans on tenants who are in receipt of benefits, or families with children. It will also be easier for tenants to share their homes with much-loved pets, with all tenants having the right to request a pet in their house. Landlords must consider these requests, and cannot unreasonably refuse.

Michael Gove's proposed changes to tenancy law all seem pretty weak to me, I doubt any of it will significantly improve the private renting experience for tenants. The ban on S21 evictions can be easily worked around - just claim you are evicting to sell when you issue notice, then once the tenant is out advertise it to rent again. Who is going to bother enforcing? The police won't care and councils won't allocate the budget.

Or get the tenants to evict themselves by issuing a massive rent increase.

Edited by Darude
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Wight Flight
23 minutes ago, Darude said:

You'd be entirely within your legal rights as a tenant to remain past the end of the S21 notice as long as you keep paying rent, expiry of the notice just means the landlord can start court proceedings to evict. But most private tenants (and no doubt most landlords and letting agents) will not be aware that this is how the law works, plus most tenants will have never done anything wrong in the eyes of officialdom in their lives and will find the idea of being taken to court highly intimidating, plus they won't want the possibility of a bad reference to make it harder to find housing in future.

 Think the word you are looking for is impossible.

Just because you can do it doesn't mean you should.

I have experience of a bad landlord reference. It isn't a good place to be.

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43 minutes ago, Wight Flight said:

 Think the word you are looking for is impossible.

Just because you can do it doesn't mean you should.

I have experience of a bad landlord reference. It isn't a good place to be.

How did that work? Were you still a tenant looking for a new place? Seems risky bad mouthing a tenant when they are still living in your house. If the landlord did that to me I'd smash the place up. Nothing to lose because he's already given a bad a reference.

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Wight Flight
3 minutes ago, Joxer said:

How did that work? Were you still a tenant looking for a new place? Seems risky bad mouthing a tenant when they are still living in your house. If the landlord did that to me I'd smash the place up. Nothing to lose because he's already given a bad a reference.

It's a long story. He didn't protect my deposit so I didn't pay the last month's rent. (I told him why)

Ended up in court. He lost a lot of money.

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Seems to be a hell of a lot of First time buyer places being swooped up as FHL/Airbnb now if you’re in a location that’s remotely tourist friendly or has people visiting for work.

Friend has been outbid by others to the tune of 20k on a couple houses all with their intention to use as FHL/Airbnb (they know these buyers as well).

Hope it’s not a case of out of the BTL frying pan into the FHL fire.

Edited by mh9000
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Wight Flight
4 hours ago, mh9000 said:

Seems to be a hell of a lot of First time buyer places being swooped up as FHL/Airbnb now if you’re in a location that’s remotely tourist friendly or has people visiting for work.

Friend has been outbid by others to the tune of 20k on a couple houses all with their intention to use as FHL/Airbnb (they know these buyers as well).

Hope it’s not a case of out of the BTL frying pan into the FHL fire.

They are doing their sums based on last year's prices and occupancy rates.

Fools.

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On 20/06/2022 at 11:34, mh9000 said:

Seems to be a hell of a lot of First time buyer places being swooped up as FHL/Airbnb now if you’re in a location that’s remotely tourist friendly or has people visiting for work.

Friend has been outbid by others to the tune of 20k on a couple houses all with their intention to use as FHL/Airbnb (they know these buyers as well).

Hope it’s not a case of out of the BTL frying pan into the FHL fire.

I think it could be for a while but renting out a house on airnbnb is a massive pain in the arse as I know quite a few instances of people who did it for a while with a house in Belfast suburbia and then came to the conclusion it was more trouble than it was worth.

It has definately been affecting Belfast city centre apartments however adding a few tens of thousands on the price as they're being sold as businesses rather than residences.

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With a crooked smile
29 minutes ago, JoeDavola said:

I think it could be for a while but renting out a house on airnbnb is a massive pain in the arse as I know quite a few instances of people who did it for a while with a house in Belfast suburbia and then came to the conclusion it was more trouble than it was worth.

It has definately been affecting Belfast city centre apartments however adding a few tens of thousands on the price as they're being sold as businesses rather than residences.

I got in very early with airbnb. In fact we started with crashpadder a British site airbnb took over to give them more hosts and scale.

I took a flat that was generating 10k ish a year and started getting 25ish k  . In the end tho the market got flooded. People weren't doing their sums and although I could make more than residential it wasn't worth the hassle for about 3-4k extra after costs. Went back to residential. Never looked back. Once tenants settled in I find we never hear from them again for ages.

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From ToS -

thewigs back

https://www.housepricecrash.co.uk/forum/index.php?/topic/244038-the-failing-economics-of-btl/&do=findComment&comment=1103891691

Wrong, but mainly because BTL doesn't borrow at the base rate.

A new landlord is probably looking to borrow at a fix 2 to 3% above base, so proportionately a 0.25% raise in the deal is nothing like as bad as you say.

The amount that can be borrowed by a landlord will, as ever, still be based firstly upon the deposit being a minimum 20 to 25% and then secondly whether the anticipated rent is a sufficient multiple of the interest.  As the deal interest rate goes up, either the proposed rent has to (and rents very clearly are),  or potentially lenders wanting to lend could get around this by offering 5 year fixes at nice low rates but with bigger fees that can be added to the loan balance and then basing the affordability tests on the lower rate offered.

I am one of your "DEBTjunkie scumbags" (Nice term but that's fine. Before I became a full time landlord/ developer I worked for a firm run by a billionarie and I was unsure how to correctly address him as people seemed to call him by is initials and all sorts of nicknames. He said to me "you can call me what you like as long as you do your work".  So call me what you like.)

I only owe around a million so I am not losing any sleep whatsoever at the moment.  I have already raised a few rents around 10% this year to cover my increasing costs, but where things are really improving is where tenants move on and I am finding I can then rise my rents around 40 to 50%. I didn't make that the market rent, but it was so obvious that this was always going to happen. The reason my rents can jump so much is that before this year I never bothered raising them.  I have to now. S24, epc changes,raising rates, EICRs, licencing etc, and a list of about 100 other things all has to be paid for and that, along with all the antilandlord rhetoric making other landlords leave the market is what has pushed rents beyond where I imagined. The catch, that i feel tenants need to be aware of, is that thanks to all the changes allegedly for the benefit of tenants, these much higher rents barely make the landlord the same profit as 5 years ago.  Think about that.  Who has actually won here?  The tenant paying loads more, or the landlord struggling to make the same money as 5 years ago?  Neither?  Somebody has though people.

I read quite a few sensible posts on this forum, including one the other day that so many people are gullible and don't realise that our leaders like to cause division (the old divide and conquer).  I find it ironic that another key division is missed. I would contend that so often the landlord tenant relationship is pitched as completely adversarial.  When I think of my various tenants in real life, nothing could be further from the truth.  

All my tenants actually want to be tenants. I have wealthy families from Hong Kong finding their feet before they buy somewhere around my houses in London.  A family from Poland thinking of returning there in the near future.  HMOs with students and young grads staying there for work whilst still regarding other parts of the country as true home.  A family from Portugal that live here but have no intention on buying here as they already own a much nicer place in Portugal.  A family on benefits who are fighting my s21 whih I served because they have basically trashed the place and also are in arrears despite receiving all but £25 a month in LHA.  OK maybe the last ones don't want to be tenants but they should be the State's problem, not a PRS problem, as they don't even try to work.

It makes me laugh on this site how so many posters seem to think it would be fantastic if everything went wrong for me and all other landlords. Think carefully though.  These tenants are the people that would be hurt.  I could stop being a landlord relatively quickly if I chose.  

 

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For Jess Dene*, 51, and her partner, the burden is already painful. The couple are self-employed and have built a portfolio of seven properties in the South West as their retirement fund.

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“We didn’t have any money until we were in our 40s and by then it was too late to start a pension,” she said. “Our only option was property.”

But the Government’s buy-to-let crackdown and soaring house prices have already pushed back their plans. “Our aim was to have a pre-tax monthly rental profit of £5,000. We were at £3,500, but that has dropped to £3,200 following the interest rate rises. For two people, that is no longer sustainable.”

Ignoring the misuse of the word 'profit', they were skimming a ~500/m arb between rent and the IO BTL mortgage.

Theyve now had IR cost go up ~50/m per property and are struggling????

Now throw in a few long running voids, something I am actually seeing here n there.

Poof!

Then another 4% on IO BTL costs.

 

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Ben Cameron*, 60, has now decided to sell his 30 buy-to-lets, a portfolio he had built to fund retirement. “It is the final nail in the coffin. The Government is derailing my pension plan. I have no idea what I will do to look after my family or where I will go for security now,” he said.

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For Mr Cameron, the end of Section 21 and the move to rolling tenancies is key. One of the properties he had planned to keep was a house he lets to students. Without Section 21, he cannot guarantee that the property will be available for incoming tenants for the next university term. If tenants could leave after two months’ notice, as under the new plans, he would also be unable to find new tenants in the middle of an academic year. “Then how would I look after myself? I could go bust,” he said.

 

 

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A raft of previous measures, such as new requirements for electrical checks, have already squeezed profit margins, said Ms Dene. “It used to cost £75 to renew a tenancy agreement. We just renewed one and it cost £900. The red tape costs so much money.” She is worried that a requirement for all properties to meet new minimum standards will bring additional costs in the form of paying for checks and certification.

Thats cos the letting agent was dumping the fees on the tenant.

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2 hours ago, spygirl said:

For Jess Dene*, 51, and her partner, the burden is already painful. The couple are self-employed and have built a portfolio of seven properties in the South West as their retirement fund.

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“We didn’t have any money until we were in our 40s and by then it was too late to start a pension,” she said. “Our only option was property.”

But the Government’s buy-to-let crackdown and soaring house prices have already pushed back their plans. “Our aim was to have a pre-tax monthly rental profit of £5,000. We were at £3,500, but that has dropped to £3,200 following the interest rate rises. For two people, that is no longer sustainable.”

Ignoring the misuse of the word 'profit', they were skimming a ~500/m arb between rent and the IO BTL mortgage.

Theyve now had IR cost go up ~50/m per property and are struggling????

Now throw in a few long running voids, something I am actually seeing here n there.

Poof!

Then another 4% on IO BTL costs.

 

You can bet as well they are paying zero for anything but the most basic upkeep. Getting in handymen to bodge fix any issue. Have they factored into the cost a full new boiler replacement, kitchen/bathroom?

They can get away with it for a while but it creeps up, then the "good" tenants notice this and start avoiding so they end up with the ones who take a year to kick out and sink them financially 

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4 hours ago, spygirl said:

Ben Cameron*, 60, has now decided to sell his 30 buy-to-lets, a portfolio he had built to fund retirement. “It is the final nail in the coffin. The Government is derailing my pension plan. I have no idea what I will do to look after my family or where I will go for security now,” he said.

Bloke with 30 houses pleds poverty.

Fuck right off.

You were 'looking after your family' by stealing a roof over 30 other families heads.

If you don't have any other investments/pensions by 60 then you're a moron.

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8 hours ago, spygirl said:

All my tenants actually want to be tenants. I have wealthy families from Hong Kong finding their feet before they buy somewhere around my houses in London.  A family from Poland thinking of returning there in the near future.  HMOs with students and young grads staying there for work whilst still regarding other parts of the country as true home.  A family from Portugal that live here but have no intention on buying here as they already own a much nicer place in Portugal.  A family on benefits who are fighting my s21 whih I served because they have basically trashed the place and also are in arrears despite receiving all but £25 a month in LHA.  OK maybe the last ones don't want to be tenants but they should be the State's problem, not a PRS problem, as they don't even try to work.

It's amazing how every landlord says all of their tenants love renting from them and yet when private tenants are polled directly 80%+ of them say they want to buy. I guess it's possible that tenants are telling their landlords what a perfect arrangement it is for them, what else are you going to say to somebody with the power to kick you out of your home?

Landlord brain disease is real:

No photo description available.

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8 hours ago, spygirl said:

For Jess Dene*, 51, and her partner, the burden is already painful. The couple are self-employed and have built a portfolio of seven properties in the South West as their retirement fund.

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“We didn’t have any money until we were in our 40s and by then it was too late to start a pension,” she said. “Our only option was property.”

I had no idea people over 40 weren't allowed to make pension contributions, when did this come in?

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UnconventionalWisdom
36 minutes ago, Darude said:

It's amazing how every landlord says all of their tenants love renting from them and yet when private tenants are polled directly 80%+ of them say they want to buy. I guess it's possible that tenants are telling their landlords what a perfect arrangement it is for them, what else are you going to say to somebody with the power to kick you out of your home?

Landlord brain disease is real:

No photo description available.

People want to think they are doing good to the world but it's easier to kid yourself than actually doing good

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reformed nice guy
45 minutes ago, JoeDavola said:

Is Phil on coke here?

 

He is totally smashed       on multiple interest only BTL mortgages

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leonardratso

yeah hes kinda twitchy after 15 minutes, like he needs another line or whisky or something.

The comments are mainly landlords complaining about bein 'dun over' by the bastards, but theres a hardcore of interjecting 'you parasitical scum are finished' interlopers piping up every now and then.

I get the feeling the landlords commenting seem to know it, and they seem to know they are scum as well, despite protesting too much that they arent, might be just me and i might biased but it certainly had that intangible vibe about it.

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