How does Buy to Let END!

[Don Coglione]

25 minutes ago, HousePriceMania said:

That's an interesting point.  Unless of course the BTL landlord can no longer afford the mortgage or to live off the rent.  Then they need to sell.  

 

Not all BTLers will be in this position but the over levered will.

Cue Fergus Wilson appearing in the news again

Weren't you buying one last week?

[HousePriceMania]

20 minutes ago, Don Coglione said:

Weren't you buying one last week?

Hey Stalker, yes, offered on one at 40% below asking, offer not rejected yet but should find out today.  

Figures dont make sense at current asking price so at 40% off it's a good offer, dont expect them to accept but if they did we'd proceed with the purchase.  The house looks like a repo but the agent says no otherwise we wouldn't have bothered.

Cash purchase so not levered up nor do we need need the rent to survive.

It's good to know someone cares enough about me to follow my every word

Edited October 5, 2022 by HousePriceMania

[spygirl]

On 29/03/2019 at 08:33, spygirl said:

I was googling around unfo in this:

https://www.bbc.co.uk/news/business-47740529

These are all MX cBTL customers. They are grasping at straws trying to make a case out of robot signing - its does nto matter who the fuck signs the doucment, the mortgage is owed to the bank not the employee.

The MP - Holinrake - is a cunt ex Yawk EA, probably stacked with BTLs

https://publications.parliament.uk/pa/cm/cmregmem/170306/hollinrake_kevin.htm

Land and property portfolio: (i) value over £100,000 and/or (ii) giving rental income of over £10,000 a year

A third share in 12 residential properties in York: (i) and (ii). (Registered 05 June 2015)

Anyhow stumpled on this from guardian:

https://www.theguardian.com/money/2016/dec/10/buy-to-let-landlords-vilified-lending-crackdown-tax-hike-profit-loss

But critics warn the clampdown may force up rents – and argue that they are not all fat cats. Cooper, 55 and from Windsor, is a landlord with 15 properties across the country, from Crawley in the south to Grimsby in the north. On paper he appears to be a millionaire, with the properties worth a total of £2.4m. But Cooper works as cabin crew on an airline earning £34,000 a year, and says he began doing buy to let to supplement his otherwise meagre pension.

His total rental income is £104,000 a year, but mortgage interest and charges are £88,000, leaving him with an annual profit of £16,000. Added to his pay it brings his annual income to £50,000. Currently he pays £12,320 tax and national insurance on that, but once the tax changes are fully phased in by 2020 his bill will rise to £22,720. Figures prepared by his accountant suggest the tax on his rental income will rise from £4,600 (or 29% of his profits) to £14,900, or 93% of his profits. If interest rates rise he says he will have to pay tax in excess of his profits.

Those numbers are fuckign insane. The idiot and the banks who lent him that money need to be stripped of all assets and put in jail.

Earning 34k in Crawley means the fucker could barely afford to rent a fucking flat never mind 'own' a 2.4m property empire.

Rental income for individual should never have been allowed to be discounted from rent - this wa an oversight as noone ever though banks would be stupid enough to lend how they did.

What sort of leverage does he have? IO Mortgage @ say 4%/y of ~90k means hes carrying around 2m of io debt on a salary of 34k in the frocking South. Apply MMR lending ,hed only been able to get a resi mortgage under 150k.

 

 

My post from 3 1/2 years ago,.

But critics warn the clampdown may force up rents – and argue that they are not all fat cats. Cooper, 55 and from Windsor, is a landlord with 15 properties across the country, from Crawley in the south to Grimsby in the north. On paper he appears to be a millionaire, with the properties worth a total of £2.4m. But Cooper works as cabin crew on an airline earning £34,000 a year, and says he began doing buy to let to supplement his otherwise meagre pension.

His total rental income is £104,000 a year, but mortgage interest and charges are £88,000, leaving him with an annual profit of £16,000.

Lets  assume that 88% was at 4%. Probably  was.

Now lets double that to 8% - 176k IR - 70k rent shortfall.

10% - 200k+

To misquote Colonel Kurtz - The leverage ....

[spygirl]

“I think a perfect storm is brewing in the rental market,” says Cooper. “There isn’t enough property being built of any tenure in the UK. Landlords will either have to raise rents or sell because of the tax rises. If they sell, their tenants will have to leave. But then there will be less rental property around, so rents for other places will rise. It’s supply and demand.”

Cooper was one of a group of landlords so enraged by the changes that they took their case to court. But the Axe the Tenant Tax group, represented by Cherie Booth QC, lost the case, and hopes of a reprieve in the autumn statement from new chancellor Philip Hammond were dashed.

[HousePriceMania]

This made me PMSL

 

 

 

[spygirl]

2 hours ago, HousePriceMania said:

This made me PMSL

 

 

 

Maybe they need to get him banned for talking the market down....

 

[HousePriceMania]

26 minutes ago, spygirl said:

Maybe they need to get him banned for talking the market down....

 

My 40% below asking offer was rejected.

Thank god for that.

[spygirl]

Telewag scary the horses...

(via the power of  wget ...)

Mortgage crisis spreads as buy-to-let loans disappear

Number of fixed-rate deals on the market is down by 70pc

By Melissa Lawford 6 October 2022 • 11:42am

Buy-to-let landlords are struggling to take out fixed-rate mortgages, with just a handful of deals remaining on the market after recent withdrawals.

Two-year fixed-rate mortgages have disappeared from the market in the last few weeks. At close of business on Wednesday just two of these mortgages for buy-to-let landlords purchasing in through a company were available, according to Mortgages for Business, a buy-to-let broker. 

A further 67 two-year fixed-rate deals remain available for landlords purchasing as individuals. Experts said the number of fixed-rate deals on the market was down by 70pc.

Lenders have made mass withdrawals of mortgage deals in recent weeks, triggered by fears of much higher than expected interest rate rises, making fixed-rate mortgages very difficult to price. Affordability tests have also become stricter, with some lenders asking landlords to prove they can afford rates of 8.49pc, experts said. 

Short-term fixes are the most difficult for lenders to price, as forecasters expect interest rates to rise steeply in the coming months, before peaking in the middle of 2023.

Jeni Brown, of Mortgages for Business, said while the number of buy-to-let deals had halved since the mini-Budget on September 23, the number of fixed-rate buy-to-let deals had fallen by around 70pc.

“There’s no question that it’s harder to get a fixed-rate buy-to-let mortgage deal at the moment. Lenders are taking shelter from the economic tsunami that followed in the wake of the mini-Budget,” Ms Brown said.

Landlords purchasing in a limited company – a tax efficient structure that lets investors offset their mortgage interest payments against their tax bills, unlike those purchasing in their own names – now have 165 options, according to Mortgages for Business.

Of these, 110 were fixed-rates. The vast majority – 95 – were five-year fixes.

Landlords purchasing as individuals had 329 deals in total, of which 254 were fixed.

On June 1, there were 3,484 buy-to-let mortgage deals on the market, according to Moneyfacts, a data provider. By September 29, this number had plunged 75pc to just 862. This week the number has recovered to 1,057, but this still represents a 70pc drop compared to the summer.

As lenders slowly relaunch deals, prices are rising. Over the same period, the average rate has nearly doubled from 3.32pc to 6.4pc, according to Property Master, another buy-to-let broker.

The cheapest buy-to-let deal available is now at 3.29pc, according to Property Master. This was more than three times the lowest last year, which charged 0.99pc.

Not only are deals becoming more expensive, but lenders’ affordability tests are becoming tougher. Angus Stewart, of Property Master, said: “The major route that lenders are using to restrict and manage their borrowings are changes to the stress rate.” Some lenders now test that landlords can afford to make payments at 8.49pc, he said.

[spygirl]

Welll .. banks dont lending to LtdCos. Could have told the fuckwits before they started down the 'Get around with forming a LtdCo scma'

IO BTL is far riskier than the LL and bank assume. Once IRs go up then voids go up then the book goes bad.

IO BTL is insane leverage that requires low low IRs to break even.

IO BTL requires an unholy trinity of ZIRP, high in-work benefits and millions of migrants.

Remove one - and poof!

Note the affordability check heading rapidly to 10%

 

 

 

[Ash4781b]

There was always that risk that the BTL mortgage market shut down especially compared to gilt prices / yields. Even savings accounts rates, annuity rates are rising. I suppose now it’s whether it’s temporary or it’s over. Tbh there wasn’t that much in the mini budget but I guess it’s the ideology that market didn’t like?
 

I’m Seeing a few local BTL trying to offload rentals. Obviously a huge reductions in buyers so I guess we’ll see a lot of holding on to see what it’s worth. But if the BTL has got rid of tenants needs to really sell out so there’s a pressure to sell. And then there’s the capital gains tax but I suspect that’s all a bit of a wink wink I was living there (I did have one landlord who rented out on a residential mortgage)

[Ash4781b]

https://www.bbc.co.uk/news/business-63160377
 

“During the financial crisis in 2008, Philip Wilson says he became a somewhat reluctant landlord.

The property market had slowed considerably so he decided to rent out, rather than sell, two properties - a flat and a house in North and West Yorkshire. 

Now, the upheaval in the mortgage market means he is being forced to push up the rent for his tenants, and is considering whether he will eventually have to sell up.

"I really feel for my tenants," the 64-year-old says. "One of them is really struggling, she pays her rent in parts when she has the cash. But now I'm going to have to tell her that her rent is going up. She has been [paying] £395 a month, and it's now looking like it will go up to £450. That is quite an increase.

"But I've swallowed several interest rate rises this year without increasing rents. Now I have to pass them on. 

"Hand on heart, once this crisis is over, I'll be selling both properties. I feel sorry for my tenants but I can't be a charity."”

Lol wtf 

 

[XswampyX]

23 minutes ago, Ash4781b said:

Lol wtf 

How did he 'accidently' buy two houses?

How did he 'accidently' rent them out?

 

[King Penda]

Talking to the Pakistani guy doing next door but one up he is getting it converted into an official 3 bed and claims he will get 750 a month for it im

like wtf he also says he has tenants waiting im like yes next door . But do they know you want 750 for it .either way I know how much it cost him he was moaning about it’s previous owner not paying it’s council tax and wishing he could find him I’m like that’s Wayne you realy don’t want to find him .seems a nice guy and has a team of Pakistani builders doing jobs for him but he is doing a fair bit himself . He took the chimney stack off and is moaning that next doors owner only bunged 600 towards the job it’s a shared stack . He reckons it’s going to cost 30k on top of the house price I reckon he will let me mooch about the house shortly.

[Guest]

9 hours ago, King Penda said:

Talking to the Pakistani guy doing next door but one up he is getting it converted into an official 3 bed and claims he will get 750 a month for it im

like wtf he also says he has tenants waiting im like yes next door . But do they know you want 750 for it .either way I know how much it cost him he was moaning about it’s previous owner not paying it’s council tax and wishing he could find him I’m like that’s Wayne you realy don’t want to find him .seems a nice guy and has a team of Pakistani builders doing jobs for him but he is doing a fair bit himself . He took the chimney stack off and is moaning that next doors owner only bunged 600 towards the job it’s a shared stack . He reckons it’s going to cost 30k on top of the house price I reckon he will let me mooch about the house shortly.

Seems like a lot of work for not much money. Say £200k all in to buy the house and do the work, then assuming he can get his desired rent he gets to charge £9k a year for it (ignoring maintenance, letting agent fees, voids), that's a 4.5% return. He could get a 4.5% return by opening a savings account.

[JohnnyB]

10 hours ago, Ash4781b said:

https://www.bbc.co.uk/news/business-63160377
 

“During the financial crisis in 2008, Philip Wilson says he became a somewhat reluctant landlord.

The property market had slowed considerably so he decided to rent out, rather than sell, two properties - a flat and a house in North and West Yorkshire. 

Now, the upheaval in the mortgage market means he is being forced to push up the rent for his tenants, and is considering whether he will eventually have to sell up.

"I really feel for my tenants," the 64-year-old says. "One of them is really struggling, she pays her rent in parts when she has the cash. But now I'm going to have to tell her that her rent is going up. She has been [paying] £395 a month, and it's now looking like it will go up to £450. That is quite an increase.

"But I've swallowed several interest rate rises this year without increasing rents. Now I have to pass them on. 

"Hand on heart, once this crisis is over, I'll be selling both properties. I feel sorry for my tenants but I can't be a charity."”

Lol wtf 

 

I hope Philip has a heart attack and some junior doctor who is 'forced' to rent from a greedy landlord is 'forced' to pull the plug because it's lunch time in 5 mins and he doesn't want to get stuck in the big queue at Costa which is building up.

[King Penda]

1 hour ago, Darude said:

Seems like a lot of work for not much money. Say £200k all in to buy the house and do the work, then assuming he can get his desired rent he gets to charge £9k a year for it (ignoring maintenance, letting agent fees, voids), that's a 4.5% return. He could get a 4.5% return by opening a savings account.

The house was 70 needs a lot of work

[spygirl]

11 hours ago, Ash4781b said:

https://www.bbc.co.uk/news/business-63160377
 

“During the financial crisis in 2008, Philip Wilson says he became a somewhat reluctant landlord.

The property market had slowed considerably so he decided to rent out, rather than sell, two properties - a flat and a house in North and West Yorkshire. 

Now, the upheaval in the mortgage market means he is being forced to push up the rent for his tenants, and is considering whether he will eventually have to sell up.

"I really feel for my tenants," the 64-year-old says. "One of them is really struggling, she pays her rent in parts when she has the cash. But now I'm going to have to tell her that her rent is going up. She has been [paying] £395 a month, and it's now looking like it will go up to £450. That is quite an increase.

"But I've swallowed several interest rate rises this year without increasing rents. Now I have to pass them on. 

"Hand on heart, once this crisis is over, I'll be selling both properties. I feel sorry for my tenants but I can't be a charity."”

Lol wtf 

 

Putting aside the fuckwittery on accidental LL, if his tenant is struggling to pay the rent then what makes him think his next tenant will pay it?

And who will buy the house?

 

 

 

[spygirl]

Not LLing but from the same article -

Alice Heywood, a digital curator from Edinburgh, has been looking at what the increases mean for her when her current deal expires in June.

"I've been overpaying my mortgage by £100 as I'm really keen on reducing the overall term. I was doing well with my current deal. I knew interest rates would go up, of course they would, but I thought it would be an incremental hike, not an overnight jump," the 47-year-old says.

She is facing repayments on a new deal that are £200 a month higher than she had expected.

"It's so gut-wrenching because I'd been doing all the right things - really trying to reduce my mortgage debt, getting a permanent and stable job. I just feel like the rug has been pulled from underneath my feet."

 

A 47yo getting a permanent and stable job ...

[sarahbell]

3 hours ago, Darude said:

Seems like a lot of work for not much money. Say £200k all in to buy the house and do the work, then assuming he can get his desired rent he gets to charge £9k a year for it (ignoring maintenance, letting agent fees, voids), that's a 4.5% return. He could get a 4.5% return by opening a savings account.

HMO
changes everything.

3 bedroom house. As family home = tops 900 a month even on a good day that's optimistic
3 x500 a month per room = 1500 but you can squeeze and extra room in so 2000.
Add another and you get more.

There are some 11 bedroom HMO  in Oldham.

 

Edited October 8, 2022 by sarahbell

[With a crooked smile]

On 05/10/2022 at 09:05, Don Coglione said:

Weren't you buying one last week?

Get real it's all fantasy stuff. He messed up big style when he sold to rent years ok. Look at his posting style it reads like someone who's had a mental breakdown. 

[Wight Flight]

I've come up with a new simple financial rule for the BTL brigade.

they were renting at 4% yield, and borrowing at 2%.

They still get 4% yield, but will be borrowing at 6%.

Therefore whatever their monthly profit used to be will now be their monthly loss.

Do you think I should post this hand ready reckoner on property118?

[CVG]

What is this new "part buy-part rent" nonsense I'm seeing in IW?

https://www.rightmove.co.uk/properties/127001342#/?channel=RES_BUY

Property description

PROPERTY DESCRIPTION ** PART BUY PART RENT ** 

£87,500 is for a 50% share purchase, the full property price is £175,000. 
The minimum CASH DEPOSIT you will need is £35,000 

Turn any freehold property into part buy -part rent with Hose Rhodes Dickson Estates Agents and 'Your Home'. You simply need 20% cash deposit on the full purchase price, there's no need for a mortgage and you can buy more or move at any time. Subject to status and certain criteria (please see below for more details), you can buy from 20% -75% and pay rent on the part you do not buy whilst being able to staircase over time to own 100% of the property. Your Home is a part buy -part rent scheme available on freehold properties for sale with Hose Rhodes Dickson Estate Agents. 

*Your Home eligibility criteria: 
-Good credit history 
-Income to support the unpurchased share 
-Be a British or EU citizen or have indefinite rights to remain in the UK 
-Must be your principle and only home at completion 

[spygirl]

34 minutes ago, Wight Flight said:

I've come up with a new simple financial rule for the BTL brigade.

they were renting at 4% yield, and borrowing at 2%.

They still get 4% yield, but will be borrowing at 6%.

Therefore whatever their monthly profit used to be will now be their monthly loss.

Do you think I should post this hand ready reckoner on property118?

10% not 8%

[spygirl]

12 minutes ago, CVG said:

What is this new "part buy-part rent" nonsense I'm seeing in IW?

https://www.rightmove.co.uk/properties/127001342#/?channel=RES_BUY

Property description

PROPERTY DESCRIPTION ** PART BUY PART RENT ** 

£87,500 is for a 50% share purchase, the full property price is £175,000. 
The minimum CASH DEPOSIT you will need is £35,000 

Turn any freehold property into part buy -part rent with Hose Rhodes Dickson Estates Agents and 'Your Home'. You simply need 20% cash deposit on the full purchase price, there's no need for a mortgage and you can buy more or move at any time. Subject to status and certain criteria (please see below for more details), you can buy from 20% -75% and pay rent on the part you do not buy whilst being able to staircase over time to own 100% of the property. Your Home is a part buy -part rent scheme available on freehold properties for sale with Hose Rhodes Dickson Estate Agents. 

*Your Home eligibility criteria: 
-Good credit history 
-Income to support the unpurchased share 
-Be a British or EU citizen or have indefinite rights to remain in the UK 
-Must be your principle and only home at completion 

Scam

https://yourhome.org.uk/

[spygirl]

Under review

https://www.gov.uk/government/news/heylo-housing-registered-provider-limited-grading-under-review