How does Buy to Let END!

[sancho panza]

17 hours ago, With a crooked smile said:

Of course they are, there's not knowing when you will be moved on, the fact you can't really decorate and make changes to the house yourself, restrictions over pets, forced moving costs etc to add.

The costs are mental as well as monetary. Renting generally a mugs game.

FAscianting story,thanks for sharing.It's always fascianting listening to peoples life stories and how they ended up where they are.

As AW says,hosuign markets are local,as are job markets to some extent.

I could haev bought in the 90's,2 bed terrace in Leicester was £50k in nice area,£30k slightly rougher.These are the hosues that have mulitbagged the most ime.I went travelling isntread,few years later thought about settling again but it was 2002 and thought teh market was going to go down.How wrong I was.

Saw 2008 coming but failed ot predcit the repsonse in temrs of monetary policy and failed to postion for it.

Sat down and had a chat with Mrs P two nights back.Shes been struggling with work stressing her out.Went through the figures.She was shocked to find out we could retire and live a reasonable life on our ISA monies.She said I'd never mnetioned the figures before-I had she jsut didnt lsiten .

key thing here is that if I hadnt put most of our savings into BATs/BP/Shell etc we wouldnt be anywhere near retiring.

WHilst I take your point that for msot people buying ahosue is the best option,it's only really clear cut on lower priced hosues where the rental yiled is over 9%/10%

We rent an £800k pad (20221 price admittedly) on a 2.2%.Leics.

Previous to this pad,we rented for £800pcm for 5 years,£600pcm for 4 years iirc

Renting isn't ideal but as per AWW psot neither is renting if you're in a stressful job with young kids and a mortgage rate going 2% to 6%.

On top of that I know a number of BTL LL's,no offence but your a shrwed cookie compared to them in terms of leverage/risk managment.The worst(should never have been an LL imho) I know is going into the hole at 70(inlc lsoing family home) witha  £3mn portfolio of 2006/7 vintage pads.

 

11 hours ago, AWW said:

Suggest a trip to a school gate in a nice bit of London/SE and survey the mental state of parents who've recently bought houses vs those who rent and have built capital in more liquid asset classes less negatively correlated with the cost of credit. My eldest is just out of reception, so lots of fellow parents who bought just long enough ago to have a) paid a lot of money for their house and b) just be rolling off their 5 year 1-point-something percent fix to 

Of course, it'll be different in other parts of the country where house prices aren't as high and rental yields are better. I don't think it's possible to generalise; there's no single housing market and everyone makes their own choices and has to live with them.

I think you have to get well inot the nroth before the recent IR rises wont have that much of an impact.

I know people who bought a cheap pad in Leicester in the 90's and then rolled the equity into a bigger bet on the hsouing market and now are 50 and balls deep halfway through a 25 year mrotgage on a 60% LTV £500k loan.

Itll be fine if they dont work for wilko.

for those that cashed in and paid off their loans fair paly to them.

knowing when to move money on and off the table is a key skill in life.

 

[sancho panza]

I think we're getting to the nub of what the renters reform bill is really aiming to do and that is support UK govt trying to cover the cracks of its numerous housing policy failures

Its always struck me as indirect discrimination to ban DSS on the grounds mentioned here.

https://uk.finance.yahoo.com/news/landlords-face-fines-turning-away-132215735.html

Landlords face fines for turning away benefit claimants under watchdog crackdown

Landlords face fines for refusing to house benefit claimants under a regulatory crackdown on the private rental sector.

The competition watchdog has raised the “possible unlawful discrimination” against those in receipt of benefits as an “area of concern” and said a “significant minority of landlords and letting agents may not be following consumer protection rules”.

It also sounded the alarm on other issues such as onerous requirements for tenants to guarantee rent can be paid, the misselling of “zero deposit schemes” and high fees charged to residents of retirement homes.

 

It said advertising properties as not available to housing benefit claimants could constitute unlawful discrimination.

Levelling up secretary Michael Gove had promised to ban the practice in the Renters Reform Bill, but so far such a rule has not been included.

At least two individual cases in York and Birmingham county courts have judged the practice of advertising properties as “no DSS” – which refers to the now-defunct “Department for Social Security” that used to pay people’s benefits – to be unlawful. But no national ban on the practice has ever come into force.

The competition watchdog said landlords who “automatically rule out a class of people” as tenants of a property because they are in receipt of benefits could risk “direct discrimination”.

It added: “We are also concerned that some discrimination, for example against families, while it may not directly engage with a protected characteristic, may indirectly discriminate against women.”

More women than men typically make use of state benefits, and more women than men report disabilities year-on-year.

While the CMA does not yet have the power to wage fines against landlords, under the Digital Markets, Competition and Consumers Bill – yet to be enacted – it will soon have the power to do so.

While the CMA said the majority of landlords have decent relationships with their tenants, Sarah Cardell, its chief executive, said possible unlawful discrimination by landlords warranted “further investigation”, saying the regulator was “ready to take enforcement action if needed”.

“In most parts of the country, however, the gap between LHAs [benefits] and competitive rents is growing. In fact, it’s larger than ever at the moment.”

Around 1.8 million private renters in England receive help through universal credit or legacy housing benefit to afford their home, according to Shelter.

Last year, the charity said current Local Housing Allowance benefits would cover fewer than one in five private rents in England.

 

 

[Wight Flight]

3 hours ago, sancho panza said:

I think we're getting to the nub of what the renters reform bill is really aiming to do and that is support UK govt trying to cover the cracks of its numerous housing policy failures

Its always struck me as indirect discrimination to ban DSS on the grounds mentioned here.

https://uk.finance.yahoo.com/news/landlords-face-fines-turning-away-132215735.html

Landlords face fines for turning away benefit claimants under watchdog crackdown

Landlords face fines for refusing to house benefit claimants under a regulatory crackdown on the private rental sector.

The competition watchdog has raised the “possible unlawful discrimination” against those in receipt of benefits as an “area of concern” and said a “significant minority of landlords and letting agents may not be following consumer protection rules”.

It also sounded the alarm on other issues such as onerous requirements for tenants to guarantee rent can be paid, the misselling of “zero deposit schemes” and high fees charged to residents of retirement homes.

 

It said advertising properties as not available to housing benefit claimants could constitute unlawful discrimination.

Levelling up secretary Michael Gove had promised to ban the practice in the Renters Reform Bill, but so far such a rule has not been included.

At least two individual cases in York and Birmingham county courts have judged the practice of advertising properties as “no DSS” – which refers to the now-defunct “Department for Social Security” that used to pay people’s benefits – to be unlawful. But no national ban on the practice has ever come into force.

The competition watchdog said landlords who “automatically rule out a class of people” as tenants of a property because they are in receipt of benefits could risk “direct discrimination”.

It added: “We are also concerned that some discrimination, for example against families, while it may not directly engage with a protected characteristic, may indirectly discriminate against women.”

More women than men typically make use of state benefits, and more women than men report disabilities year-on-year.

While the CMA does not yet have the power to wage fines against landlords, under the Digital Markets, Competition and Consumers Bill – yet to be enacted – it will soon have the power to do so.

While the CMA said the majority of landlords have decent relationships with their tenants, Sarah Cardell, its chief executive, said possible unlawful discrimination by landlords warranted “further investigation”, saying the regulator was “ready to take enforcement action if needed”.

“In most parts of the country, however, the gap between LHAs [benefits] and competitive rents is growing. In fact, it’s larger than ever at the moment.”

Around 1.8 million private renters in England receive help through universal credit or legacy housing benefit to afford their home, according to Shelter.

Last year, the charity said current Local Housing Allowance benefits would cover fewer than one in five private rents in England.

 

 

Pointless.

Just wastes everyone's time.

[Boglet]

6 hours ago, sancho panza said:

I think we're getting to the nub of what the renters reform bill is really aiming to do and that is support UK govt trying to cover the cracks of its numerous housing policy failures

Its always struck me as indirect discrimination to ban DSS on the grounds mentioned here.

https://uk.finance.yahoo.com/news/landlords-face-fines-turning-away-132215735.html

Landlords face fines for turning away benefit claimants under watchdog crackdown

Landlords face fines for refusing to house benefit claimants under a regulatory crackdown on the private rental sector.

The competition watchdog has raised the “possible unlawful discrimination” against those in receipt of benefits as an “area of concern” and said a “significant minority of landlords and letting agents may not be following consumer protection rules”.

It also sounded the alarm on other issues such as onerous requirements for tenants to guarantee rent can be paid, the misselling of “zero deposit schemes” and high fees charged to residents of retirement homes.

 

It said advertising properties as not available to housing benefit claimants could constitute unlawful discrimination.

Levelling up secretary Michael Gove had promised to ban the practice in the Renters Reform Bill, but so far such a rule has not been included.

At least two individual cases in York and Birmingham county courts have judged the practice of advertising properties as “no DSS” – which refers to the now-defunct “Department for Social Security” that used to pay people’s benefits – to be unlawful. But no national ban on the practice has ever come into force.

The competition watchdog said landlords who “automatically rule out a class of people” as tenants of a property because they are in receipt of benefits could risk “direct discrimination”.

It added: “We are also concerned that some discrimination, for example against families, while it may not directly engage with a protected characteristic, may indirectly discriminate against women.”

More women than men typically make use of state benefits, and more women than men report disabilities year-on-year.

While the CMA does not yet have the power to wage fines against landlords, under the Digital Markets, Competition and Consumers Bill – yet to be enacted – it will soon have the power to do so.

While the CMA said the majority of landlords have decent relationships with their tenants, Sarah Cardell, its chief executive, said possible unlawful discrimination by landlords warranted “further investigation”, saying the regulator was “ready to take enforcement action if needed”.

“In most parts of the country, however, the gap between LHAs [benefits] and competitive rents is growing. In fact, it’s larger than ever at the moment.”

Around 1.8 million private renters in England receive help through universal credit or legacy housing benefit to afford their home, according to Shelter.

Last year, the charity said current Local Housing Allowance benefits would cover fewer than one in five private rents in England.

 

 

 

An alternative perspective in this video of some knock on effects/ulterior motives for some of these changes.

 

 

[JohnnyB]

15 hours ago, Wight Flight said:

Pointless.

Just wastes everyone's time.

Rather a stark contrast between these toothless "regulations" and the story on the last page about writing a 4 page personal declaration before even being considered as worthy to rent.

[Wight Flight]

27 minutes ago, JohnnyB said:

Rather a stark contrast between these toothless "regulations" and the story on the last page about writing a 4 page personal declaration before even being considered as worthy to rent.

If I was a LL I would have one very simple test.

I want to meet you in your current house.

 

[spygirl]

On 22/08/2023 at 01:42, sancho panza said:

one for @spygirl CRE heading up poop creek sans le paddle

suspect our banks are balls deep

https://uk.finance.yahoo.com/news/british-landlords-face-3bn-hit-105432244.html

Landlords face losing billions in rent owed by WeWork, as the work space provider grapples with the rise of home working.

British landlords are exposed to more than £3bn in rental commitments from WeWork, London’s biggest private tenant.

A Telegraph analysis of WeWork’s UK subsidiaries shows the pay-as-you-go office provider has signed leases worth £3.1bn at more than 50 locations in Britain.

 

But the firm, once valued at $47bn (£37bn), has warned that there are “substantial doubts” over its ability to keep operating and its shares have lost 97pc of their value over the past 12 months.

can

 

WeWork is v similar to IO BTL.

WeWork take on lease then try and fill the space.

Io btl take an io position and try and rent the house.

In both cases, the banks are kidding themselves tgat using an intermediary somehow how gets rid of the risk.

It doesn't. Risk is increased. Problrms hidden til its too late.

And having an extra entity in the loop  makes resolution harder, more expensive.

[spygirl]

On 22/08/2023 at 20:43, XswampyX said:

How does BTL end?

Quickly! 

 

I've posted the pointlessness of moving to IO andor extending the mortgage term.

Just does work when Apr moves from sub 3% to 6%+.

It's just an annoying beardy regurgitating what I've posted on here n Tos.

 

[spygirl]

On 16/08/2023 at 10:02, sancho panza said:

video posted by @XswampyX

 

the stills are lifted off by me.SHows how returns have deteriorated.The BTLers her refers to were making money on a 2% IO BTL 50% LTV mortgage.At the end he discusses how screwed they'd be if they were 75% LTV.

The maths is awful.Nationwides BTL mrotgage book at 91% IO looks enoguh to tkae them under  even without the other dog poo sandwich laons they written in Londinium and SE

video

at 1.49 a long lsit of warning signs that UK govt was raising costs of BTL.

at 5.47

at 6.26

at 7.04

at 9.55 Yer man works out that when they switch to a 'new normal' IR,they'll be losing money.He seems shocked by this.

at 10.25,he outlines that they're 50% LTV, and that at 75% LTV theyd be lsoing moeny big time

At 12 minutes he points out that the LL can't sell to anotehr investor because they'll be in exactly the same position of losing moeny every month.

 

Thread from Apr 2017

https://www.housepricecrash.co.uk/forum/index.php?/topic/229792-countdown-to-leveraged-btl-going-bust-thread/#comment-1103223898

The destruction of io btl was baked in with s24, which was published in 2014ish.

Almost 10y for io btl to learn excel.

Only surprise was how low rates went, drawing more fuckwits in, and how quickly they've normalised.

 

 

[spygirl]

10 minutes ago, spygirl said:

Thread from Apr 2017

https://www.housepricecrash.co.uk/forum/index.php?/topic/229792-countdown-to-leveraged-btl-going-bust-thread/#comment-1103223898

The destruction of io btl was baked in with s24, which was published in 2014ish.

Almost 10y for io btl to learn excel.

Only surprise was how low rates went, drawing more fuckwits in, and how quickly they've normalised.

 

 

Not me.

100% correct.

• •  490

Posted April 16, 2017

  On 15/04/2017 at 22:10, RushRoad said:

The first sentence was said in jest and I did not mean to mean the rumors of my personal demise, I meant it in terms as landlords as a whole.

It's alright.  I knew it was a joke. ?

You are quite right.  Most landlords will have the cashflow to ride out S24.  But there is a subset who won't.  The evidence is in the bleating, letter writing, and tenant-tax campaigning.  The subset is certainly small, I would guess less than  10% of landlords.  But this subset control a disproportionate amount of the PRS, I would guess about 30%.  Will this subset going bust move the market?

It's clear from your posts that you don't believe it will.  You use data from the 1970s to support your position.  Fair enough, it's your money.  But your position is just another "HPI forever" position we see on this forum all the time.  Base rates at zero for your lifetime and rents tracking GDP are just an extension of your position.  And let's face it, your position is the common wisdom of the times, there is nothing particularly radical about it.  They're not building any more land, are they!  HPI is a natural phenomenon, and you've set out to ride the wave smartly and efficiently.  Along with 2 million of your colleagues.

But what you seem unwilling to consider is the contrarian position.  It's possible that HPI, in the last 3 decades in general, and since 2000 in particular, is simply an outcome of landlords gaming lending, tax and benefits rules.  Rules that were set up for other purposes, but just happened to enrich landlords.  In this contrarian world, landlords aren't riding the HPI wave.  Landords are the wave.  And the small subset of highly leveraged landlords, controlling a vast amount of properties, is the tsunami.

It's clear that changes to rules that were never set up to enrich landlords are never going to be modified to save landlords.  In fact the opposite is likely.  The penny is dropping that HPI and landlordism is disastrous for both society and the economy.  Landlords can expect more tax, tighter lending, and statutory changes in favour of tenants.  The exact opposite of your position on rates and rents.

Either way, the tsunami is going to recede, and take with it otherwise solvent landlords and homeowners.  The small subset of landlords can and will, by themselves, cause all the damage.  You are betting the farm that S24 won't take you down.  But you are looking through the wrong end of the telescope.  If I was sitting on a portfolio with significant capital gains, I would count my blessings, sell everything now, and do something more useful with my life.

[spygirl]

The small number of extremely leveraged Io btl have enough property exposure to basically knock out their local property market.

And un places with FHLs, the fuckwits buying holiday lets have driven the market for 10y.

People exiting both sectors are flooding their markets.

 

[One percent]

On 25/08/2023 at 14:36, sancho panza said:

I think we're getting to the nub of what the renters reform bill is really aiming to do and that is support UK govt trying to cover the cracks of its numerous housing policy failures

Its always struck me as indirect discrimination to ban DSS on the grounds mentioned here.

https://uk.finance.yahoo.com/news/landlords-face-fines-turning-away-132215735.html

Landlords face fines for turning away benefit claimants under watchdog crackdown

Landlords face fines for refusing to house benefit claimants under a regulatory crackdown on the private rental sector.

The competition watchdog has raised the “possible unlawful discrimination” against those in receipt of benefits as an “area of concern” and said a “significant minority of landlords and letting agents may not be following consumer protection rules”.

It also sounded the alarm on other issues such as onerous requirements for tenants to guarantee rent can be paid, the misselling of “zero deposit schemes” and high fees charged to residents of retirement homes.

 

It said advertising properties as not available to housing benefit claimants could constitute unlawful discrimination.

Levelling up secretary Michael Gove had promised to ban the practice in the Renters Reform Bill, but so far such a rule has not been included.

At least two individual cases in York and Birmingham county courts have judged the practice of advertising properties as “no DSS” – which refers to the now-defunct “Department for Social Security” that used to pay people’s benefits – to be unlawful. But no national ban on the practice has ever come into force.

The competition watchdog said landlords who “automatically rule out a class of people” as tenants of a property because they are in receipt of benefits could risk “direct discrimination”.

It added: “We are also concerned that some discrimination, for example against families, while it may not directly engage with a protected characteristic, may indirectly discriminate against women.”

More women than men typically make use of state benefits, and more women than men report disabilities year-on-year.

While the CMA does not yet have the power to wage fines against landlords, under the Digital Markets, Competition and Consumers Bill – yet to be enacted – it will soon have the power to do so.

While the CMA said the majority of landlords have decent relationships with their tenants, Sarah Cardell, its chief executive, said possible unlawful discrimination by landlords warranted “further investigation”, saying the regulator was “ready to take enforcement action if needed”.

“In most parts of the country, however, the gap between LHAs [benefits] and competitive rents is growing. In fact, it’s larger than ever at the moment.”

Around 1.8 million private renters in England receive help through universal credit or legacy housing benefit to afford their home, according to Shelter.

Last year, the charity said current Local Housing Allowance benefits would cover fewer than one in five private rents in England.

 

 

Don’t see how that will fly, discrimination is based on “protected characteristics “. I didn’t realise that they had slipped in, “bennie scum” alongside “sexual orientation” and “ethnicity “.  

[One percent]

8 minutes ago, spygirl said:

The small number of extremely leveraged Io btl have enough property exposure to basically knock out their local property market.

And un places with FHLs, the fuckwits buying holiday lets have driven the market for 10y.

People exiting both sectors are flooding their markets.

 

I’ve not seen a fhl rush for the exit yet. A trickle which will probably become a flood. 

[spygirl]

On 17/08/2023 at 07:21, One percent said:

https://www.bbc.co.uk/news/uk-england-wiltshire-66524739
 

Families on low incomes can no longer cover their rent with the housing benefit they are paid, according to a charity.

Housing advisors at Wiltshire Citizens Advice found "barely any" homes to rent that were covered by the benefit.

Claire Waltham-Smith, from Citizens Advice, said people were cutting out essentials to pay their rent, with some facing eviction.

The Government said it will spend £30bn on housing support this year.

Describing the situation, Ms Waltham-Smith said: "People go without energy or food, they are falling into rent arrears, they face eviction."

People living on low incomes often qualify for Universal Credit, which includes a housing element. This is based on the cost of housing where they live, called the Local Housing Allowance (LHA).

Since April 2020, the LHA has been frozen.

 

On 17/08/2023 at 08:00, Wight Flight said:

Paid...

2. to give over (money) in exchange for something.

3. to transfer money to (a person or organization) as compensation for work done or services rendered.

 

I think given would be the right word.

Tom Waters, who carried out the research, called it a "really big fall".

He pointed out that four in 10 private renters are receiving housing benefit.

"It does not make sense to have a system where the support you can get is frozen, and when rents go up, the cash support does not change," he said.

"There is no justification for that."

 

Before ~2000ish the number of families on benefits, renting houses in the PRS was almost 0.

PRS benefit rentals were HMOs for single people/dossiers n teenagers and the odd little old lady.

It makes *every* sense to freeze LHA, esp when the daft lefties n media make a big fuss about nothing over 3k /m to Shazza 10kid.

 

 

[spygirl]

5 minutes ago, One percent said:

I’ve not seen a fhl rush for the exit yet. A trickle which will probably become a flood. 

Oh it's happening.

Wait til they count up this summers taking and look at paying mortgage themselves til next June.

[One percent]

5 minutes ago, spygirl said:

Oh it's happening.

Wait til they count up this summers taking and look at paying mortgage themselves til next June.

Yep, I’m think that the next few months will see a flood. 

[spygirl]

On 23/08/2023 at 00:46, AWW said:

The sums are a bit more complex than just "how much have you paid in rent?" and there are also other factors.

The house I'm renting for £2.5k a month would have cost at least a million quid at any point since I've been in a position to buy something like it. I'd have put down £200k in 2016, but didn't because it was always obvious that IRs would normalise at some point, and I didn't want that point to be just after I bought a house. The risk of going from ZIRP to normal IRs was always just too big for me to take, given the life-changing sums involved.

Anyway, the house would have gone up to about £1.25m peak, but I wouldn't have sold it, so it doesn't matter. No idea what it's worth now as the market has ceased to exist. I'd have been paying, what, £20k a year in interest on average, reducing slightly until now? And a £32k repayment element. Instead, it's been £30k a year rent and £40k into my SIPP, which is not only up hugely over the last few years thanks to the thread that most of us are here for, but also comes with associated tax relief. I can't be bothered to do the sums to get the exact numbers, but it doesn't feel like there's a lot in it.

And, right now, if I'd bought, I wouldn't be able to sleep at night, waiting for the interest portion of the mortgage to increase to somewhere north of £40k a year even on the reduced balance of ~£600k, and watching my equity halve or more.

Personally, much of the bitterness I see on here stems from success (or lack of) with women rather than tenure.

All the rent v buy always assume you have no other money or return.

Me n Mrs spy had a smaller places years. Then we rented as we checked an area out n had kids.

We only bought when kids were touching secondary.

During the renting period most of the rent was paid by yield on investments - a sum less than the supposed house worth was generating the bulk if the rent.

We shoved in ~200 month for the balance.

That 200/m would have been swallowed by Mrs spy's travel costs if we hadn't moved.

We didnt time the market, too hard kids n all.

However we were v liquid and could afford to put in low ball offers and move quickly - at our choosing.

Renting removed the whole stress n expense of moving - paid for an extra month and moved stuff over over a few weekends.

 

[spygirl]

On 25/08/2023 at 18:07, Wight Flight said:

Pointless.

Just wastes everyone's time.

It genuinely is. Just another example of the number of daft leftiy wimmininfecting the public n 3rd sector.

The whole wank of more wimmin on benefits n disabled is the biggest.

Surely the CMA should be looking into this blatant discrimination against men?

Most btlmortgages forbid renting to benefits.

When push comes to shove they don't have the money to pay the missed rent which is 100% going to happen.

 

 

[sancho panza]

2 hours ago, One percent said:

I’ve not seen a fhl rush for the exit yet. A trickle which will probably become a flood. 

As per my previously realted story of BTLer with 25 BTL's going under.Last eyar was making £5k a month,now losing same.

Of thsoe 25,11 or 12 are with Mortgage Express.They were saying if they could release the equity from the Mortgage express ones then they might have a lifelline.

But mE not daft.tehyve said if you liquidate we keep the rpofits and this alludes to a point made in the ToS thread that @spygirl psoted by spy himself

This is how it works.He who panics first gets his moeny back.

The set up is ready and ripe.See banking thread it's jsut when those inside cotton on they're done and we'll have Lehman the redux starring-(insert name of ludricously overleveraged UK BS/US bank).Noone could have seen it coming natch

 

[XswampyX]

11 hours ago, spygirl said:

The small number of extremely leveraged Io btl have enough property exposure to basically knock out their local property market.

And un places with FHLs, the fuckwits buying holiday lets have driven the market for 10y.

People exiting both sectors are flooding their markets.

 

They 'own' all the 1 bedroom flats above all the take aways, all the 2 bedroom flats squashed between the abattoir and the strip club. What about the 4 bedroom house that's been turned into a HMO housing 8 people in a terrace of other houses with 8 people in them.

What are they actually worth without BLT as the driver of their 'value'?

Really. Who will want to take out a £200,000 mortgage to live above Mohammed's chicken 'n' white slag knocking shop?

Not me!    

[spygirl]

8 hours ago, XswampyX said:

They 'own' all the 1 bedroom flats above all the take aways, all the 2 bedroom flats squashed between the abattoir and the strip club. What about the 4 bedroom house that's been turned into a HMO housing 8 people in a terrace of other houses with 8 people in them.

What are they actually worth without BLT as the driver of their 'value'?

Really. Who will want to take out a £200,000 mortgage to live above Mohammed's chicken 'n' white slag knocking shop?

Not me!    

You are describing the PRS *before* IO BTL.

PRS is everywhere now.

See those new build estates?

Youll know that ~20% are reserved for social housing.

However, all the new build estates Ive been to also have 30%-50% IO BTL. typically renting to people the LHA wont touch.

In he North that 20% + 50% instantly pushes all new build estates into slum estates.

2br, 3br, 4br --- IO BTL.

City centre - IO BTL.

IO BTL mortgages are commercial lending so are not tracked like resi mortgages.

I cant couch for the numbers, just using as an example -

https://www.uswitch.com/mortgages/buy-to-let-statistics/

In 2022, more than 211,000 buy-to-let mortgages were approved by UK lenders, and occupied 13.6% of total mortgage lending for the year. 

I would have expected 0 BTL mortgages to have been approved in 2022.

But that assumes the BTLers are sane, rational people. They are not.

Post 2008 IO BTL was making up a hefty percentage of houses sold.

Post2 008 Id guess IO BTL was ~50% of house sales.

Thats a lot of sales that have to make their way thru a a very illiquid market.

[MithrilVest]

Thank you for the informative reply @With a crooked smile

Sounds like the hospitality industry is in your blood.

[With a crooked smile]

Contacted by HSBC today (I have a current account, joint account and ISA with them).

Relaxing lending on BTL. Info below:

HSBC is increasing its maximum mortgage term to 40 years for buy to let, purchase, remortgaging and additional borrowing.

Second homes will no longer be limited to 30 years and can now be considered up to 40 years but residential applications on interest only products will remain capped at a 25-year maximum term. This will include part and part interest-only mortgages as well.

[dnb24]

1 hour ago, With a crooked smile said:

Contacted by HSBC today (I have a current account, joint account and ISA with them).

Relaxing lending on BTL. Info below:

HSBC is increasing its maximum mortgage term to 40 years for buy to let, purchase, remortgaging and additional borrowing.

Second homes will no longer be limited to 30 years and can now be considered up to 40 years but residential applications on interest only products will remain capped at a 25-year maximum term. This will include part and part interest-only mortgages as well.

Some people won’t like this but it makes f*** all difference- 

Someone with a £200,000 mortgage paying 5.5 per cent interest over 25 years would face monthly repayments of £1,228, paying a total of £368,400 over the lifespan of the mortgage.

Someone with a £200,000 mortgage paying the same interest rate over a 40-year term would face monthly repayments of £1,032.

But would pay £495,089 over the lifespan of the mortgage: £126,689 more than on a 25-year term.

so for sake of £50 a week- someone’s going to extend their mortgage to 40 years to eventually pay back £126k more. Or tighten your belt and make a packed lunch instead of buying it at M&S everyday. 

Edited August 30, 2023 by dnb24

[With a crooked smile]

Just now, dnb24 said:

Some people won’t like this but this makes f*** all difference- 

someone with a £200,000 mortgage paying 5.5 per cent interest over 25 years would face monthly repayments of £1,228, paying a total of £368,400 over the lifespan of the mortgage.

someone with a £200,000 mortgage paying the same interest rate over a 40-year term would face monthly repayments of £1,032.

But would pay £495,089 over the lifespan of the mortgage: £126,689 more than on a 25-year term.

so for sake of £50 a week- someone’s going to extend their mortgage to 40 years to eventually pay back £126k more than if they made a packed lunch and didn’t  buy their lunch at M&S everyday. 

People will still do it. All people give a shit about is the monthly figure.