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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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Again.

S21 is a request to gain possession.

The LL needs to get a court order to actually evict.

If a LL cannot wait 12-18 to gain possession then there is no way on earth they should have got into LLing.

 

 

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28 minutes ago, spygirl said:

Buy-to-let landlords forced to sleep in cars as they cannot evict rogue tenants

Property owners become homeless as councils tell tenants to wait for bailiffs

ByMelissa Lawford29 March 2022 • 12:00pm

Buy-to-let landlords have effectively been made homeless after delays to repossession claims have forced some property investors to sleep in their cars. 

Landlords have been unable to gain control of their properties after evicting tenants, as councils have advised renters to stay in their homes until they are forcibly removed by bailiffs.

This local authority advice has compounded record wait times in the courts and means some landlords must wait for weeks to regain possession.

Natasha French, of Brittons estate agents in King’s Lynn, Norfolk, said a local landlord had been sleeping in his lorry trailer while he grapples with months-long delays repossessing his property.

The landlord, 38, invested in a buy-to-let property with money that he inherited when his father died, in the hope he could help his children with future housing deposits. 

When his marriage broke down a few months ago, he needed to regain possession of the property so he could live in it. He served his tenants with a "section 21" notice – which should trigger a so-called “no fault eviction” – that expired at the start of March.

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The tenants have asked the local council for help finding a new home. The council told them they do not currently have suitable accommodation for the family, and that the have a legal right to remain in the property until they are evicted.

“The landlord is homeless. He can’t afford to rent somewhere else,” said Ms French.

David Smith, of JMW Solicitors, said: “It happens all the time. Any situation where a tenant goes to the local authority to find a new home, the local authority will tend to say they don’t have any local authority homes available so wait until the bailiffs come.”

The advice compounds massive delays in the court system. “None of this would matter if the Government could improve the speed between court order and possession. It is not funding the court system properly,” said Mr Smith.

In the last three months of last year, the mean wait time between a landlord’s court order and possession was 68 weeks. Excluding the highs reached earlier in 2021, this was the highest on record in any three month period in the Ministry of Justice’s dataset, which goes back to 2009.

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Tenants have a legal right to remain in a property until they are evicted by bailiffs, but local authorities are supposed to find alternative accommodation for low-income tenants when they have been issued with a possession notice.

If a tenant is in arrears and they stay in the property until the eviction notice goes through the courts, they will be more likely to get a money judgement against them, said Mr Smith. 

A spokeswoman for King’s Lynn and West Norfolk Borough Council said it could not comment on individual cases, but  advised people to seek alternative accommodation after they have been served with an eviction notice.

“We offer financial assistance and support to help them do this if they need it and we will also offer temporary accommodation from the date that the eviction notice expires, which they may or may not choose to accept. We also advise them of their full range of options and that does include their legal right to remain in the property, although we further advise that court costs may be incurred if they do this,” she said.

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Last year, the Local Government and Social Care Ombudsman upheld a complaint from a landlord against Brentwood council, which advised tenants to remain at his property until their eviction date after their section 21 eviction notice had expired. 

Brentwood council agreed to pay the landlord £1,679, which included lost rent and court costs.

Buy-to-let investors must be more aware of the likelihood of costs arising from delayed repossessions, experts warned. Mr Smith said: “Landlords elect not to price in these potential losses. I get landlords saying they can’t pay their mortgage because of these issues. Well, that is not a good business plan.”

The problem is rooted in the shortage of local authority housing and is one reason why landlords are often reluctant to take tenants on benefits, he added.

what a shame (not)

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Frank Hovis
13 hours ago, spygirl said:

The problem is rooted in the shortage of local authority housing and is one reason why landlords are often reluctant to take tenants on benefits, he added.

 

I hadn't realised that that was the reason; I thought it was social profiling (which is fair enough).

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39 minutes ago, Frank Hovis said:

 

I hadn't realised that that was the reason; I thought it was social profiling (which is fair enough).

Its made up.

One, private LL have only existed in large number sicne 2002.

Before that, the only private LL social tenants used to the HMO flophouses.

Private LL would never touch families with kids as -

1) They went straight to top of LA housing list so never needed private housing.

2) Too risky - youd be liable for the rent if they were fiddling bennies. HMO/flophouses dont have that problems as they are much cheaper, so the risk is much smaller.

IIRC most IO BTL mortgage providers specified no LA/social tenants - for obvious reasons.

 

 

Edited by spygirl
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On 20/03/2022 at 20:48, spygirl said:

North Yorks.

I'm guessing if it's true or there about,  theyll be in the Scarb-Brid area.

Further back in thus thread I've mentioned the number of ordinary people in Scarbs - taxi drivers, tradesmen  etc - who 'own' extraordinary number of houses.

All on the never never, and pretty much zilch hpi, certainly not enough for costs n voids.

These cretins should have exited as soon as s24 started.

 

 

FB post - 

 

Is something wrong with the estate at Phoenix Drive opposite B&q? So many houses for sale at the same time...

 

A lot of the properties on there are rental properties and landlords are selling.

New build estate, ashoved off a haorrendous road.

Built in 2006.

https://houseprices.io/?q=Phoenix+Drive%2c+Scarborough&p=5

Go to page 3.

Not bad....

Then try page 2.

Then page 1.

 

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Noallegiance

"Sterling White from Indiana was collecting welfare and selling Pokémon cards until he accrued a portfolio of 400 rental properties in less than four years"

 

....So he's still collecting welfare then.....

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2 hours ago, spygirl said:

FB post - 

 

Is something wrong with the estate at Phoenix Drive opposite B&q? So many houses for sale at the same time...

 

A lot of the properties on there are rental properties and landlords are selling.

New build estate, ashoved off a haorrendous road.

Built in 2006.

https://houseprices.io/?q=Phoenix+Drive%2c+Scarborough&p=5

Go to page 3.

Not bad....

Then try page 2.

Then page 1.

 

Never just rains.

https://www.bbc.co.uk/news/uk-england-york-north-yorkshire-60944972.amp

30 odd years ago, you could get a very good paying job - equivalent to 70k.

Pindar used yo do Sunday supps, Yrllow pages.

Not quite Fleet street n Spanish practise, but heavily unionised and 100s of job in a small NY town.

The bosses idiot son took over, crashed it into ground 10 years ago.

Picked up by YM shove now crashed n burned.

Plenty of - Weve 2 cars, a house n no money.

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1 hour ago, spygirl said:

Never just rains.

https://www.bbc.co.uk/news/uk-england-york-north-yorkshire-60944972.amp

30 odd years ago, you could get a very good paying job - equivalent to 70k.

Pindar used yo do Sunday supps, Yrllow pages.

Not quite Fleet street n Spanish practise, but heavily unionised and 100s of job in a small NY town.

The bosses idiot son took over, crashed it into ground 10 years ago.

Picked up by YM shove now crashed n burned.

Plenty of - Weve 2 cars, a house n no money.

Jesus.

Reaching Biblical proportions-

 

Scarborough residents stunned after 'mini-tornado' tears through Eastfield and rips roof from Plaxton

Strong winds which swept across a corner of Eastfield this morning have torn the roof from bus construction firm Plaxton.

https://www.yorkshirepost.co.uk/news/weather/scarborough-residents-stunned-after-mini-tornado-tears-through-eastfield-and-rips-roof-from-plaxton-3635258

 

QVNIMTI1MTg0ODU4.jpg?&width=640

Edited by spygirl
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On 20/03/2022 at 20:48, spygirl said:

North Yorks.

I'm guessing if it's true or there about,  theyll be in the Scarb-Brid area.

Further back in thus thread I've mentioned the number of ordinary people in Scarbs - taxi drivers, tradesmen  etc - who 'own' extraordinary number of houses.

All on the never never, and pretty much zilch hpi, certainly not enough for costs n voids.

These cretins should have exited as soon as s24 started.

 

 

Not sure if it's a media claim.

Or listening to a deranged letting agent.

https://www.gazettelive.co.uk/news/teesside-news/landlords-sell-up-more-cash-23580735

Landlords 'sell up' for 'more cash and less stress' in seaside town renting crisis

Local letting agent Mary said landlords are stepping into the holiday rental market for more money

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If they are selling up then they cant AirBnB.

Holiday let's Airbnb is not really a thing in Scabby.

This is just idiit Io btl ll trying to exit, 6 years too late.

There isnt enough mortgage buyers in town to absorb tge idiot LLs portfolios.

 

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With a crooked smile
3 hours ago, spygirl said:

If they are selling up then they cant AirBnB.

Holiday let's Airbnb is not really a thing in Scabby.

There's a fair few. Airbnb is about short term rental rather than true holiday let's. When i did it with 3 rooms in a totally non holiday destination I got a surprising number of 'contractors' everything from construction to health care to IT Monday to Friday and then a surprising amount of people attending local events I didn't even know were happening at weekends, plus wedding guests people visiting family who's family couldn't put them up ect.

Screenshot_20220403-193139_Chrome.jpg

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I never thought it would be this hard to be a landlord

The Secret Landlord: tax breaks on buy-to-let were once too good to be true, but now the tables have turned

THE SECRET LANDLORD4 April 2022 • 6:00am

When I first invested in buy-to-let, there was a tax incentive that allowed you to sell your properties, live abroad for a minimum of five years and pay no capital gains tax. There was a list of allowable countries; I recall Malta being one and Bermuda could have been another.

If you didn’t fancy going abroad, there was another incentive called “taper relief” that rewarded you for owning a property for a long time by reducing the amount of tax you paid according to the length of ownership.

Those were the days (before the 2008 financial crash) when people believed that property prices doubled every seven years. Stamp duty was zero for properties valued at less than £150,000, and you could claim wear and tear allowance (up to 10pc of your annual rental income for furnished properties). 

You could also claim full mortgage interest relief. When I bought my first property, I thought I had bought a magic bean.

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Alas, what I didn’t know then was that tax laws change – and that they always will.

When ministers first proposed that a landlord would not be able to claim mortgage interest on a rental property, I thought they must be mad. I remember meeting my MP and expressing my disbelief. How could what I considered a legitimate business expense no longer be deducted from my profits? He shook his head solemnly and told me he thought the whole idea was crazy.

Now it is part of a landlord’s everyday life. I never incorporated as a company, I had many meetings with my tax advisers and looked into various schemes (some more suspect than others), but in the end I decided that the costs were not worth it. 

On the face of it, incorporation sounded an ideal solution, but when you dug into the details – the mortgage deals already held that would need to be changed, the legal implications, the potential tax bills (capital gains and stamp duty, dividend and corporation tax), plus the cost of running a company – it seemed far from ideal.

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And I felt that if so many landlords were incorporating, these businesses would soon become another target for the Chancellor. Now, from April 1 next year, corporation tax will rise in stages from 19pc to 25pc for companies whose profits are more than £50,000 and less than £250,000. 

It is a significant increase and, when combined with the rise in personal tax on dividends and the higher interest rates that companies have to pay, it may call into question company property ownership, not least because when you sell a company-owned property you can’t use your personal capital gains tax-free allowance (currently £12,300).

You do get to choose when you take the money out, so there is some flexibility, but there will always be tax to pay.

I don’t have a crystal ball, but I wouldn’t be surprised if capital gains tax was raised beyond the present top rate of 28pc. By not increasing the personal allowance or the higher-rate income tax threshold until at least 2026, the Government is effectively raising income tax by stealth.

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But tax can be a matter of personal choice: it is obligatory to pay, but how you choose to spend or invest your money dictates the amount of tax you pay. If you don’t have a car, you don’t have to pay road or fuel tax; if you don’t smoke or drink, there is again less tax to pay. Property, in the grand scheme of things, is not a tax-efficient investment. Isas, workplace pensions and Sipps all offer considerable tax advantages.

Of course, where property wins is in the leverage: the ability to invest with borrowed money. But with leverage come both risks and rewards, and as an investor you have to decide if the risk is worth the reward – after tax.

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23 hours ago, With a crooked smile said:

There's a fair few. Airbnb is about short term rental rather than true holiday let's. When i did it with 3 rooms in a totally non holiday destination I got a surprising number of 'contractors' everything from construction to health care to IT Monday to Friday and then a surprising amount of people attending local events I didn't even know were happening at weekends, plus wedding guests people visiting family who's family couldn't put them up ect.

Screenshot_20220403-193139_Chrome.jpg

175 Airbnb, for a town the size of Scabby (61k) is tiny.

Quick Airbnb there are 300+ in Whitby, a town (10k - and falling)

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1 hour ago, spygirl said:

...

When I first invested in buy-to-let, there was a tax incentive that allowed you to sell your properties, live abroad for a minimum of five years and pay no capital gains tax. There was a list of allowable countries; I recall Malta being one and Bermuda could have been another.

...

That wasn't an incentive scheme FFS, it was a loophole that was subsequently closed!

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With a crooked smile
1 hour ago, Axeman123 said:

That wasn't an incentive scheme FFS, it was a loophole that was subsequently closed!

Still loads you can do. Lots of people move abroad rental income goes against the personal allowance of a couple so gives you quite a few grand tax free and allows you to keep paying ni stamps to get your pension at proper retirement age.

The other fairly normal thing to do it pay a bit more stamp duty up front and buy via British Virgin Islands company

 That option is very popular. Zero capital gains when sold or inherited. 

Every town has residential property owned by foreign registered companies.  This link is old but take a look at your own town. Almost certainly you'll see something foreign owned.

https://www.private-eye.co.uk/registry

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4 minutes ago, With a crooked smile said:

Still loads you can do.

Yeah, and I am all for it. I wouldn't pay more tax than necesary, where permitted by law.

I suspect properties held by offshore entities will be a target from now on. That Kazakstan women losing her London house a year or so back was a signpost IMO, and now the Russia sanctions.

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  • 3 weeks later...

It looks like Buy to Let is ending for one landlord. All up for sale through the same Estate Agent at around £170k-190k mark. Four ex-council houses up for sale in inner city Norwich but they come with sitting tenants:

Soleme Rd, NR3, tenant paying £520 a month

Morse Rd, NR1, £600 a month

Lionwood Rd, NR1, £700 month (only 2 bedrooms yet this yields the greatest rent)

Shorncliffe Avenue, NR3, £650 a month

Will the vendor be able to find a greater fool?

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12 minutes ago, UmBongo said:

It looks like Buy to Let is ending for one landlord. All up for sale through the same Estate Agent at around £170k-190k mark. Four ex-council houses up for sale in inner city Norwich but they come with sitting tenants:

Soleme Rd, NR3, tenant paying £520 a month

Morse Rd, NR1, £600 a month

Lionwood Rd, NR1, £700 month (only 2 bedrooms yet this yields the greatest rent)

Shorncliffe Avenue, NR3, £650 a month

Will the vendor be able to find a greater fool?

First one as an example asking £170k, rent £520/month = 3.6% gross yield.

I'll have some of whatever he is smoking. Based on that rent the house would be a poor yielding investment at half the price! The FTSE100 yields 3.48% for comparison, without voids/maintenance/non-payers. (I know, leverage changes the yeild but who would want that interest rate risk right now?)

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Sadly there are always mugs. If you think property prices in the long run will always go up then people may reason to add the average gain onto the rental yield to imagine the total yield. It's stupid, but with programs for simpletons such as Homes under the Hammer there will always be people who never see housing as speculation.

I also still think properties may be attractive to certain overseas investors. The price looks pretty terrible for the area but someone coming from a place like Hong Kong might reason it is good value as they don't know the place but also that a very low or even negative yield might be preferable to some kind of government grab.

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19 minutes ago, Axeman123 said:

First one as an example asking £170k, rent £520/month = 3.6% gross yield.

I'll have some of whatever he is smoking. Based on that rent the house would be a poor yielding investment at half the price! 

I agree, it looks like poor value. Correct me if I'm wrong but there's nothing to stop the incumbent landlord from either raising the rent or even serving a S21 on the tenant. Also, the incumbent landlord will want a discount on the asking price. 

I imagine that the current tenant has been there over a decade and just had small rent rises, if any at all. 

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Just had another look at the advert for Soleme Rd. Seems like the Estate Agent has quoted the rental amount twice: £520 pcm AND £720 pcm. 9_9

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5 minutes ago, UmBongo said:

I agree, it looks like poor value. Correct me if I'm wrong but there's nothing to stop the incumbent landlord from either raising the rent or even serving a S21 on the tenant. Also, the incumbent landlord will want a discount on the asking price. 

I imagine that the current tenant has been there over a decade and just had small rent rises, if any at all. 

If a LL can put the rent up, they will already have done so. If the tennant would meekly move out when asked, the LL would likely have already had them do so. The only time I expect a LL will let a long-term tennant stay at below market rent is if the property is in a terrible state, and no other tennant would accept it. I always assume tennanted properties for sale are LLs using the sale as a substitute for eviction of a non-payer, perhaps having payed the tennant off to play nice long enough for the sale to go through.

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Wight Flight
10 minutes ago, UmBongo said:

there's nothing to stop the incumbent landlord from either raising the rent

There is - maybe that would take him above the current market rent for the area. 3.5% gross is about right from what I have seen (though more than I pay)

Though LHA for a 3 bed in Norwich is £700 per month so he does look underpriced if he doesn't mind benefit bunnies.

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Wight Flight
4 minutes ago, Axeman123 said:

If a LL can put the rent up, they will already have done so. If the tennant would meekly move out when asked, the LL would likely have already had them do so. The only time I expect a LL will let a long-term tennant stay at below market rent is if the property is in a terrible state, and no other tennant would accept it. I always assume tennanted properties for sale are LLs using the sale as a substitute for eviction of a non-payer, perhaps having payed the tennant off to play nice long enough for the sale to go through.

The red flag is the lack of internal pictures. It suggests an uncooperative tenant that has been there for quite some time.

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