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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, dgul said:

It won't (can't) happen.

For a start, you don't just end up with a country with loads of empty houses and loads of people living on the streets -- prices normalise to match.

Secondly, when the Millennials get in charge (about 2030) they'll tax OO heavily, while redesigning pensions to suit assetless pensioners.  This is how it works -- each generation sets up the system to solve what they regard as the problem (usually driven by 'what would suit them best').

It'll be a pain for me, I'm sure -- I'll end up being stung by the drive by the BBs to inflate asset prices, and the drive by the Millenials to punish house owners.  

Itll happen looong before millennials get to retirement age.

Thees a big swing to massively increasing taxation of non OOO housing.

The S24 changes are first part of it.

 

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Yep I never understand these prediction articles - they assume everything will stay the same forever. More of the deluded and non historical thinking we've been discussing on the credit deflation thread.

I'm a millennial myself and not a property owner, I could probably qualify for HTB but not way I will touch it. None of my friends are property owners either, except for those with rich parents / inheritance. Most of us earn 40-50k+ and are by all other measures pretty successful (granted this is in the SE/London). We are the exact people that you'd have thought would be buying - good jobs, long term girlfriends, kids even. But none of us can afford it. So who can? The boomer generation will die off eventually, who will buy their houses?

It's just a waiting game. I've talked to my partner a lot about this and we're on the same page. She's more worried than me, but we're saving and waiting. I don't believe all of the doom mongering over the prospects of millennials.

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4 hours ago, Hardhat said:

Yep I never understand these prediction articles - they assume everything will stay the same forever. More of the deluded and non historical thinking we've been discussing on the credit deflation thread.

I'm a millennial myself and not a property owner, I could probably qualify for HTB but not way I will touch it. None of my friends are property owners either, except for those with rich parents / inheritance. Most of us earn 40-50k+ and are by all other measures pretty successful (granted this is in the SE/London). We are the exact people that you'd have thought would be buying - good jobs, long term girlfriends, kids even. But none of us can afford it. So who can? The boomer generation will die off eventually, who will buy their houses?

It's just a waiting game. I've talked to my partner a lot about this and we're on the same page. She's more worried than me, but we're saving and waiting. I don't believe all of the doom mongering over the prospects of millennials.

Old people die at a more rapid rate than the yougn people.

Until that changes then you are OK.

In 10 years time, 50% of UK pop aged 65 and above will be dead. The demographics are that stark.

For various reassons the uK property market avoided the baby bust that followed the baby boomers have babies.

It did this mainly by baby boomers buying more than 1 houses. Im not sure what the stats are but quite a lot of 55+ 'own' 2+ houses. And I use 'own' very loosely.

So, rather than struggle to seel their OO to someone 20-30 years younger,  these people have to sell the OO, the 3 BTLs and the holiday house.

Its fucking mental. Like winning on casino then putting it on in a fruit machine.

Tehre are lots of towns wehre the difference between the over 55 and the under 45 is  nuts. Theres noone to selll the house to.

 

 

 

 

 

 

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2 hours ago, Durabo said:

What makes you think they'll sell when they die? They've probably already passed the houses onto the kids to avoid inheritance tax

An IO mortage?

Nope.

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On 17/07/2019 at 19:49, Durabo said:

What makes you think they'll sell when they die? They've probably already passed the houses onto the kids to avoid inheritance tax

Only if they've paid off the mortgage I guess?

If they own a mortgaged flat to rent out will their kids want to continue paying the mortgage on decreasing yields?

If the tax changes happening now lead to a loss making business model in ten years will their kids want the hassle of tenants?

What if (when) interest rates go up?

Agreed some will hold on to their property, but it won't be anything like it is now. 

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Wight Flight
2 hours ago, Hardhat said:

Only if they've paid off the mortgage I guess?

If they own a mortgaged flat to rent out will their kids want to continue paying the mortgage on decreasing yields?

If the tax changes happening now lead to a loss making business model in ten years will their kids want the hassle of tenants?

What if (when) interest rates go up?

Agreed some will hold on to their property, but it won't be anything like it is now. 

I assume if you die with a btl mortgage the bank will want the property sold and the debt repaid.

Not something I know about but probably an issue for banks in the near future.

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9 hours ago, Wight Flight said:

I assume if you die with a btl mortgage the bank will want the property sold and the debt repaid.

Not something I know about but probably an issue for banks in the near future.

Its an issue now, IO BTL and IO OO.

Effectively its turned the idiot banks into a rental agency, on tenderhooks every month, waiting for th rent money to roll in.

Regulated banks should *never* have touched IO lending of any sorts. Its a specialist financial product.

 

 

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How does Buy to Let END!

@macca, @Ashby 

 

A: Not with a bang but a whimper.

The Basil III, Section 24, Section 21, Fee's ban is an attempt to slowly prick BTL, giving time for the smart ones to get out early  and the 10+ house landlord to change their structure.

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On 17/07/2019 at 15:02, Hardhat said:

Yep I never understand these prediction articles - they assume everything will stay the same forever. More of the deluded and non historical thinking we've been discussing on the credit deflation thread.

I'm a millennial myself and not a property owner, I could probably qualify for HTB but not way I will touch it. None of my friends are property owners either, except for those with rich parents / inheritance. Most of us earn 40-50k+ and are by all other measures pretty successful (granted this is in the SE/London). We are the exact people that you'd have thought would be buying - good jobs, long term girlfriends, kids even. But none of us can afford it. So who can? The boomer generation will die off eventually, who will buy their houses?

It's just a waiting game. I've talked to my partner a lot about this and we're on the same page. She's more worried than me, but we're saving and waiting. I don't believe all of the doom mongering over the prospects of millennials.

+1 Same boat as you mate. We've been done hard over but the idiotic self serving policies of those before us, but there is light at the end of the tunnel. I just hope they don't try to top-up the population with migrants from the 3rd world (or1st/2nd)

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On 17/07/2019 at 09:06, One percent said:

How to completely impoverish a nation in one generation. Way to go. 

They won’t starve nobody does

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On 17/07/2019 at 15:02, Hardhat said:

Yep I never understand these prediction articles - they assume everything will stay the same forever. More of the deluded and non historical thinking we've been discussing on the credit deflation thread.

I'm a millennial myself and not a property owner, I could probably qualify for HTB but not way I will touch it. None of my friends are property owners either, except for those with rich parents / inheritance. Most of us earn 40-50k+ and are by all other measures pretty successful (granted this is in the SE/London). We are the exact people that you'd have thought would be buying - good jobs, long term girlfriends, kids even. But none of us can afford it. So who can? The boomer generation will die off eventually, who will buy their houses?

It's just a waiting game. I've talked to my partner a lot about this and we're on the same page. She's more worried than me, but we're saving and waiting. I don't believe all of the doom mongering over the prospects of millennials.

It’s only the south that has this problem imo

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One percent
1 hour ago, No One said:

+1 Same boat as you mate. We've been done hard over but the idiotic self serving policies of those before us, but there is light at the end of the tunnel. I just hope they don't try to top-up the population with migrants from the 3rd world (or1st/2nd)

The lot of everyone has worsened for the last 30 years. I’m only enough to have seen boomers retired off in their early 50s with a massive payout and pension.  My grand parents and parents could buy a house on one wage and still be able to raise a family on that one wage. 

Me, it took two to buy the property and both had to work.  My pension goalposts have been moved massively. 

You, you are even more fucked but as said it has been going on for 30 years. Boiling frog syndrome. We need to join to fight this. But then all mechanisms to do so have been quietly removed. 

6 minutes ago, stokiescum said:

They won’t starve nobody does

Maybe not but they will have no control over their lives whatsoever. A dystopian nightmare. 

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15 minutes ago, One percent said:

The lot of everyone has worsened for the last 30 years. I’m only enough to have seen boomers retired off in their early 50s with a massive payout and pension.  My grand parents and parents could buy a house on one wage and still be able to raise a family on that one wage. 

Me, it took two to buy the property and both had to work.  My pension goalposts have been moved massively. 

You, you are even more fucked but as said it has been going on for 30 years. Boiling frog syndrome. We need to join to fight this. But then all mechanisms to do so have been quietly removed. 

Maybe not but they will have no control over their lives whatsoever. A dystopian nightmare. 

One of the biggest problems is greed and the south east go hand in hand they want the big wage the kudos of livening in it and a viberent London they just don’t realize they can’t afoard it or they do and suck it up there’s no divine right to own a house where you would like to live I can’t afoard to own where I was raised ok mainly because of my life’s choices however the concept of relocating and takeing a pay cut but haveing a better standard of livening won’t cross many minds down south 

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2 hours ago, No One said:

@macca, @Ashby 

 

A: Not with a bang but a whimper.

The Basil III, Section 24, Section 21, Fee's ban is an attempt to slowly prick BTL, giving time for the smart ones to get out early  and the 10+ house landlord to change their structure.

Non amortising lending barely exists outside of uk.

Basel3 is about increasing risk weightings for real estate and cracking down on fuck wittery.

Io btl is outlawed as basel3 bans io. Or, rather, makes it painfully expensive to lend.

Btl is being deflated by the banks wanting more n more equity each time btler remortgages.

Boiling a frog.

 

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27 minutes ago, stokiescum said:

One of the biggest problems is greed and the south east go hand in hand they want the big wage the kudos of livening in it and a viberent London they just don’t realize they can’t afoard it or they do and suck it up there’s no divine right to own a house where you would like to live I can’t afoard to own where I was raised ok mainly because of my life’s choices however the concept of relocating and takeing a pay cut but haveing a better standard of livening won’t cross many minds down south 

Although lonfon was always more expensive, its never been so expensive.

In 70s n 80s large parts were still slums.

In the mid 90s london non prime property fell below 3 x earnings. Its 15-20 now.

The problem london n se have is it was a pure play on finsec

Finsec has been decimated. Jobs have gone, salaries have fallen. Train fares have gone up. A lot.

Londons fucked. Its filled with doley migrants with their hands out.

 

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3 minutes ago, spygirl said:

Although lonfon was always more expensive, its never been so expensive.

In 70s n 80s large parts were still slums.

In the mid 90s london non prime property fell below 3 x earnings. Its 15-20 now.

The problem london n se have is it was a pure play on finsec

Finsec has been decimated. Jobs have gone, salaries have fallen. Train fares have gone up. A lot.

Londons fucked. Its filled with doley migrants with their hands out.

 

Exactly I was there from say 86 -89 then went Glasgow then back to London the writing was on the wall then after the big crash in 90-91 I left and never went back I turned a job down around 4 years ago for just under 19 quid an hour I said I’d be better off on minimum wage in stoke which at the time might have been 7 quid at a push now if a thick fucker like me can see the problem I’ve got limited sympathy for those far clever who want to live the dream in London you can lead a horse to water and alll that

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24 minutes ago, stokiescum said:

Exactly I was there from say 86 -89 then went Glasgow then back to London the writing was on the wall then after the big crash in 90-91 I left and never went back I turned a job down around 4 years ago for just under 19 quid an hour I said I’d be better off on minimum wage in stoke which at the time might have been 7 quid at a push now if a thick fucker like me can see the problem I’ve got limited sympathy for those far clever who want to live the dream in London you can lead a horse to water and alll that

Crossing threads....

PH earnings is pointless without a grasp on work costs,

The skills in demand in London have shifted.

Hiwever the people living in London dont have them. And their previous well paying jibs have grossly inflated housing costs. And filling up sicial housing with 3rd world scum does not help on multiple levels.

Heres my example that i go through all the time.

You need x skill, normally software, as thats wherd all tge griwth n margins are.

You find the ideal candidate  living 90m - 100m by train outside of London.

Howmuch do you pay him or her?

Theyve got a family - skills  required mean they are mid 30s late 40s. Kids are settled in school. Psrtner has low to mid paying job.

At current pruces you need to pay 150k to live in a shitty flat in peckham. Fuck that. Dont want kids going to mogadishu high. Schools were pupils speak 50 languages are not attractive to people other than thick social workers.

So commute it is.

What do you offer?

Lets double the salary to 120k. Who could turn that down...

Well  extra 60k is taxed at 40%, becoming  36k take home. Still chunky.

Oh no, commute is going to cost 10k. Now 26k.

Oh no travel time is 4h a day, so you are pitching a 45% increase for increasing the work day by 50%

Fuck that, not worth it. And thats what hear. People are not daft.

 

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Castlevania
On 15/07/2019 at 14:25, UnconventionalWisdom said:

This is what I point out to mates that are strong Corbyn supporters. I'm like, housing is the most important thing to me and he wants to extend htb. McDonald has spoken about how crap it is so who knows what they would do. Corbyns only saving grace with housing us that his supporters are mainly young people so hed be an idiot and out of a job if he continued with the current fiscal policies supporting HPI.

Corbyn’s an Inner London MP. He’s bound to raise LHA rates. If you rent and pay the rent out of your own pocket you’d be mad to vote for him.

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14 hours ago, spygirl said:

Crossing threads....

PH earnings is pointless without a grasp on work costs......

Spot on.  May be good for cash flow but can be a bit of a bum deal when fully costed.  People could usefully calculate the cost of generating employment income.  May change their lives.  A lower paid but local (ideally mostly from home or home based with travel) job can be a lot better, especially if the peed away tax take winds you up.  Then there's the restrictions on pension relief if on a good salary, as could happen commuting to London.  Sure, do it for other reasons but bigger ain't always better.

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12 hours ago, Castlevania said:

Corbyn’s an Inner London MP. He’s bound to raise LHA rates. If you rent and pay the rent out of your own pocket you’d be mad to vote for him.

Unless voting for him causes more chaos (after Brexit ofcourse) which causes a run on the pound and 7% IR's. But its a looooong shot

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Castlevania
41 minutes ago, No One said:

Unless voting for him causes more chaos (after Brexit ofcourse) which causes a run on the pound and 7% IR's. But its a looooong shot

Yeah. But if that happens, you run the risk of capital controls. What if I want to get my money out?

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42 minutes ago, Castlevania said:

Yeah. But if that happens, you run the risk of capital controls. What if I want to get my money out?

Do it now, then vote.

 

But again, Corbin will open the gates to mass migration, but it's not as if the Tory's even try to close it.

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VeryMeanReversion
On 18/07/2019 at 22:28, Wight Flight said:

I assume if you die with a btl mortgage the bank will want the property sold and the debt repaid.

They allow the executor to carry on paying for a long time (6-12 months) but eventually need a new person to take over the mortgage in their own name.  That can either be a beneficiary or a new buyer.

Banks just want a new set of fees and someone on the hook. They don't want the money back, just the ability to get the money back.

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