Got a tenancy coming to an end in Jan, had already planned to sell the flat but now I've got to try to rush it through before April or might not be so much interest. Was going to put the money towards a small house but if I can't find a suitable one before stamp rise, am seriously considering just putting the money into shares.
I own a property bought in 2006 on an interest only mortgage. It is valued at what I bought it for, so has 0% equity. Location, Location, Location. In my street you can buy a terrace for under £50k. Less in surrounding areas. Buying properties is not the problem. Selling is another thing altogether, with some taking 2 years to sell even at these prices. More people would rather rent in my area than buy, regardless of affordability.
I think this punishes lower middle or even lower earners who may get some inheritance, decide to wisely invest in a property to ensure a more comfortable lives. That 3% will not, however, deter over seas investors and the already rich. This further creates a gap making it harder for "normal" people to make a comfortable life. A very Tory way of doing things!
'Landlords reacted angrily', troubling the hearts of no-one anywhere, ever.
I'm a 'landlord' (not by choice) on the bones of me arse coz of tenant after tenant knocking me for months and months rent at a time and I can't do jacks to stop em. I'm sure you're over the moon to hear that
Can't you get one of those guaranteed rent agent deals or sell the property ?
It generally goes, tenant moves in and pays 3-6 months rent, no problems, then they just stop paying and continue to live in the property for 3 - 4 month (The time it takes to get em evicted) Then I spend anywhere between £200-£800 getting it marketable again in the for 4-6 weeks it sits empty while I try and get someone else in it. I had an insurance with my lettings agent that covered upto 3 months rent and the court costs to get em evicted, but I've now sacked them coz they were on the fiddle an all (Keeping rent money till midway through the following month it should've been paid). So I rent it myself now
Can't sell because the lease is now below 65 years and I can't justify (or afford £14-18k) to renew it, in order to sell the property. So my plan is to try and get some money back on it until I die, which hopefully will be before the 63 or so years are up on the lease. And not only that, the road the property is in is full of pissed up freeloading Slovak gypsies, so no one is interested in it.
Feel for you mate, it makes me sick to read stuff like this.
Why is it brilliant? I purchased my first flat in Bexley at 19, lived in it for 8 years, during which time I saved enough of a deposit for my next home. As I had managed to save the deposit, which I worked hard for, I decided to keep my flat in Bexley and rent it out.
Originally I never intended to do this, as my plan was to sell the flat and pay the deposit from that.
I pay the right amount of tax of my rental property, and will pay capital gains when selling. If someone has worked hard and can afford to buy more flats/houses to rent out, as long as tax is paid, not sure I see why they should pay extra stamp duty.
It is brilliant because people such as your good self and many people I know, have all done exactly the same.
We have a massive shortage of homes and one of the reasons, is that many people have 2 or more homes.
Hopefully, if people are no longer incentivised to have more than one property and are in fact penalised, then perhaps more properties will become available for younger folk who have either very little prospect or no prospect of ever owning one property, let alone 2, 3 or more.
I don't blame you at all cafcbrown, for taking advantage. But when we have an enormous housing shortage, I believe the incentives should be in favour of people looking for a HOME as opposed to people looking to make money from property.
No offence intended to the numerous buy to letters on here as I'm sure there are plenty, which is exactly my point.
NB, If some landlords decide to sell some proprties and some landlords decide to buy less properties, then the supply on the market will increase and prices will fall. This is what I'd anticipate.
The reason there is a massive shortage of home homes is because there are too many people. You can't keep building more homes, more roads, using every green space available, destroying peoples quality of life and wildlife habitats in the process. Sooner or later you have to deal with the real problem and that is population growth. People who work hard, save hard, make sacrifices and then take risks in investing their savings, have to put their money to work somewhere, be it property or shares, or investing in business and creating jobs. Hard work and wealth creation seems to have become something to be frowned upon by too many in society these days who would rather take it easy and be looked after by the state, I'm talking generally CE and not having a dig at you.
The reason there is a massive shortage of home homes is because there are too many people. You can't keep building more homes, more roads, using every green space available, destroying peoples quality of life and wildlife habitats in the process. Sooner or later you have to deal with the real problem and that is population growth. People who work hard, save hard, make sacrifices and then take risks in investing their savings, have to put their money to work somewhere, be it property or shares, or investing in business and creating jobs. Hard work and wealth creation seems to have become something to be frowned upon by too many in society these days who would rather take it easy and be looked after by the state, I'm talking generally CE and not having a dig at you.
You can understand why it is better for the country that you invest in shares or, particularly, business rather than buy to let though can't you?
The reason there is a massive shortage of home homes is because there are too many people. You can't keep building more homes, more roads, using every green space available, destroying peoples quality of life and wildlife habitats in the process. Sooner or later you have to deal with the real problem and that is population growth. People who work hard, save hard, make sacrifices and then take risks in investing their savings, have to put their money to work somewhere, be it property or shares, or investing in business and creating jobs. Hard work and wealth creation seems to have become something to be frowned upon by too many in society these days who would rather take it easy and be looked after by the state, I'm talking generally CE and not having a dig at you.
You can understand why it is better for the country that you invest in shares or, particularly, business rather than buy to let though can't you?
Yes I can, but the problem is that share investing is now dominated by hedge Funds and high frequency algorithmic automated trading. It has become very risky for everyday "investors" rather than traders. A diversified portfolio encompassing many asset classes is now essential and property has become a virtual one way ticket to prosperity thanks to the simple law of supply and demand (over population). People would be far less likely to invest in property if that dynamic was removed and if property prices actually started to move up and down, rather than endlessly moving higher.
for every person who saves up a deposit to get a buy to let house, there was same opportunity for a first time buyer to save same deposit and purchase that very same house.
What next, ban people from buying homes with more bedrooms than people, cause surely a threes bed semi should be for family with kids not someone on their own or a childless couple.
Whilst we are at it ban second cars just so that people can afford to buy a cheaper first car.
We're never going to dent the housing crisis when he have a benefits system that subsidises housing for the poor whilst also having EU commitments that allow unlimited numbers of poor Europeans to come here and claim a home. We could build millions of new houses and still be in the same position as we are now, something has to give.
Anyone who sees a house as an investment opportunity rather than a place to live and then maybe sell for a bit of a profit ~25 years down the line is part of the problem imo.
No investment should be totally 100% safe like the housing market is atm.
for every person who saves up a deposit to get a buy to let house, there was same opportunity for a first time buyer to save same deposit and purchase that very same house.
What next, ban people from buying homes with more bedrooms than people, cause surely a threes bed semi should be for family with kids not someone on their own or a childless couple.
Whilst we are at it ban second cars just so that people can afford to buy a cheaper first car.
next thing you know major corporations will have to pay corporation tax. I know, the lunatics well and truly are running the asylum.
All the time there is a real shortage of houses like there is now it is important that those houses that are available to buy at reasonable cost are bought by first time buyers who want a family home. Investment buying is only adding to the shortage and pushing up the prices.
The rents that are being charged are in general far more a month than the cost of a mortgage on a similar property. The problem is being fuelled by buy to let.
I do feel sorry for those small time investors that are being hit by this but sometimes a serious problem has to be tackled by making difficult decisions as George Osborne is so keen on telling us.
An investment whether it be property or shares is always a risk.
for every person who saves up a deposit to get a buy to let house, there was same opportunity for a first time buyer to save same deposit and purchase that very same house.
What next, ban people from buying homes with more bedrooms than people, cause surely a threes bed semi should be for family with kids not someone on their own or a childless couple.
Whilst we are at it ban second cars just so that people can afford to buy a cheaper first car.
I understand what you are saying, but do not entirely agree.
Many people buying 2nd, 3rd and 4th properties, do not achieve this by saving up a deposit. They achieve this by releasing equity from an existing property, which first time buyers cannot do.
Also, btl's have had tax advantages, that were not available for "buy to have a roof over our heads."
So, no I don't agree that it was a level playing field, because it was not.
As I said before, I have nothing against people that btl. Good for them. Well played them.
But I'm glad that in the future, people wanting to btl, will no longer have an unfair advantage over first time buyers.
for every person who saves up a deposit to get a buy to let house, there was same opportunity for a first time buyer to save same deposit and purchase that very same house.
What next, ban people from buying homes with more bedrooms than people, cause surely a threes bed semi should be for family with kids not someone on their own or a childless couple.
Whilst we are at it ban second cars just so that people can afford to buy a cheaper first car.
next thing you know major corporations will have to pay corporation tax. I know, the lunatics well and truly are running the asylum.
The reason there is a massive shortage of home homes is because there are too many people. You can't keep building more homes, more roads, using every green space available, destroying peoples quality of life and wildlife habitats in the process. Sooner or later you have to deal with the real problem and that is population growth. People who work hard, save hard, make sacrifices and then take risks in investing their savings, have to put their money to work somewhere, be it property or shares, or investing in business and creating jobs. Hard work and wealth creation seems to have become something to be frowned upon by too many in society these days who would rather take it easy and be looked after by the state, I'm talking generally CE and not having a dig at you.
You can understand why it is better for the country that you invest in shares or, particularly, business rather than buy to let though can't you?
Yes I can, but the problem is that share investing is now dominated by hedge Funds and high frequency algorithmic automated trading. It has become very risky for everyday "investors" rather than traders. A diversified portfolio encompassing many asset classes is now essential and property has become a virtual one way ticket to prosperity thanks to the simple law of supply and demand (over population). People would be far less likely to invest in property if that dynamic was removed and if property prices actually started to move up and down, rather than endlessly moving higher.
But many property funds consist of commercial properties rather than residential. A fair number of property funds have barely got back to their values pre-crash and that's before you factor in inflation and loss of income. So property is, sometimes,far from the one way bet you say in investment terms.
I think I predicted this correctly. Buy to lets falling & first time buyers rising.
"Buy-to-let lending for house purchase plunged by nearly 80% year-on-year in March, figures from banks and building societies show.
Landlords borrowed a total of £900 million for house purchases in March, marking a 79.5% decrease compared with March 2016, when £4.4 billion-worth of loans were advanced for this purpose.
The Council of Mortgage Lenders (CML), which released the figures, said spring 2016 saw a peak of activity before stamp duty changes were introduced in April last year.
The CML also said first-time buyer and home mover activity came out of a winter seasonal dip in March. First-time buyers borrowed £4.9 billion in total in March, up 29% on February and a 9% increase compared with March 2016.
Home movers borrowed £6.2 billion for house purchases, up 19% on February but down by 33% year-on-year.
A total of £6 billion was also borrowed by home owners re-mortgaging in March - up 13% on February and a 22% increase compared with the same period a year earlier.
But the CML said that, overall, home owner house purchase activity was at its weakest for two years across the first three months of 2017, with 155,900 loans advanced to first-time buyers and home movers in the first quarter of this year.
By contrast, the number of re-mortgage loans advanced to home owners was at its highest since the first quarter of 2009, with 106,700 loans handed out in the first three months of 2017.
Mr Smee said: "The relatively sluggish activity among home movers stands in contrast to the growth in first-time buyer and re-mortgage activity, but in aggregate the market is showing broadly the levels of activity we expected.
"As we head into the summer, we expect a continuation of these trends, with both first-time buyer and re-mortgage lending expected to maintain momentum in the light of the very attractive deals currently available."
A fresh mortgage price war has broken out in recent weeks, with some lenders offering some of their lowest ever rates.
Jeremy Leaf, a north London estate agent and a former residential chairman of the Royal Institution of Chartered Surveyors (Rics), said the figures show that "realistic buyers and sellers are getting on with their business".
He said: "Putting these and other figures into perspective, we are finding on the ground that those prepared to be realistic are buying whereas those who have not yet come to terms with changing market conditions are staying put."
Partly to do with the new tax changes but also partly to do with the more stringent affordability rules. Up until last year the amount you could borrow was purely based on the rental income received - in most cases the rental income had to be covered by 125% at a set rate (usually 5%, but could be lower). Thus a 100k interest only loan had to have rental income of (£100,000 x 5% = £5,000 x 125% = £6,250/12) =£520pm.
Now the "stress test" is usually 145% coverage at 5.5% - so rental income needs to be £665 pm. Lenders have obviously seen that there has been a decline is BTL's and so have recently relaxed the rules with some going back to 125% coverage or a "stress test" rate of 5% - especially if you take out a 5 year fixed rate. however, if you are a 40% taxpayer the coverage is still at 145% .
Also, they set a minimum earned income level at £25k - so retirees with low pension income looking to boost their incomes are being squeezed out.
Comments
Was going to put the money towards a small house but if I can't find a suitable one before stamp rise, am seriously considering just putting the money into shares.
People who work hard, save hard, make sacrifices and then take risks in investing their savings, have to put their money to work somewhere, be it property or shares, or investing in business and creating jobs. Hard work and wealth creation seems to have become something to be frowned upon by too many in society these days who would rather take it easy and be looked after by the state, I'm talking generally CE and not having a dig at you.
People who work hard, save hard, make sacrifices and then take risks in investing their savings, have to put their money to work somewhere, be it property or shares, or investing in business and creating jobs. Hard work and wealth creation seems to have become something to be frowned upon by too many in society these days who would rather take it easy and be looked after by the state, I'm talking generally CE and not having a dig at you.
You can understand why it is better for the country that you invest in shares or, particularly, business rather than buy to let though can't you?
This article sums up the argument quite well.
People who work hard, save hard, make sacrifices and then take risks in investing their savings, have to put their money to work somewhere, be it property or shares, or investing in business and creating jobs. Hard work and wealth creation seems to have become something to be frowned upon by too many in society these days who would rather take it easy and be looked after by the state, I'm talking generally CE and not having a dig at you.
You can understand why it is better for the country that you invest in shares or, particularly, business rather than buy to let though can't you?
This article sums up the argument quite well.
Yes I can, but the problem is that share investing is now dominated by hedge Funds and high frequency algorithmic automated trading. It has become very risky for everyday "investors" rather than traders. A diversified portfolio encompassing many asset classes is now essential and property has become a virtual one way ticket to prosperity thanks to the simple law of supply and demand (over population). People would be far less likely to invest in property if that dynamic was removed and if property prices actually started to move up and down, rather than endlessly moving higher.
What next, ban people from buying homes with more bedrooms than people, cause surely a threes bed semi should be for family with kids not someone on their own or a childless couple.
Whilst we are at it ban second cars just so that people can afford to buy a cheaper first car.
No investment should be totally 100% safe like the housing market is atm.
The rents that are being charged are in general far more a month than the cost of a mortgage on a similar property. The problem is being fuelled by buy to let.
I do feel sorry for those small time investors that are being hit by this but sometimes a serious problem has to be tackled by making difficult decisions as George Osborne is so keen on telling us.
An investment whether it be property or shares is always a risk.
Tough times.
Many people buying 2nd, 3rd and 4th properties, do not achieve this by saving up a deposit. They achieve this by releasing equity from an existing property, which first time buyers cannot do.
Also, btl's have had tax advantages, that were not available for "buy to have a roof over our heads."
So, no I don't agree that it was a level playing field, because it was not.
As I said before, I have nothing against people that btl. Good for them. Well played them.
But I'm glad that in the future, people wanting to btl, will no longer have an unfair advantage over first time buyers.
This article sums up the argument quite well.
Yes I can, but the problem is that share investing is now dominated by hedge Funds and high frequency algorithmic automated trading. It has become very risky for everyday "investors" rather than traders. A diversified portfolio encompassing many asset classes is now essential and property has become a virtual one way ticket to prosperity thanks to the simple law of supply and demand (over population). People would be far less likely to invest in property if that dynamic was removed and if property prices actually started to move up and down, rather than endlessly moving higher.
But many property funds consist of commercial properties rather than residential.
A fair number of property funds have barely got back to their values pre-crash and that's before you factor in inflation and loss of income. So property is, sometimes,far from the one way bet you say in investment terms.
"Buy-to-let lending for house purchase plunged by nearly 80% year-on-year in March, figures from banks and building societies show.
Landlords borrowed a total of £900 million for house purchases in March, marking a 79.5% decrease compared with March 2016, when £4.4 billion-worth of loans were advanced for this purpose.
The Council of Mortgage Lenders (CML), which released the figures, said spring 2016 saw a peak of activity before stamp duty changes were introduced in April last year.
The CML also said first-time buyer and home mover activity came out of a winter seasonal dip in March. First-time buyers borrowed £4.9 billion in total in March, up 29% on February and a 9% increase compared with March 2016.
Home movers borrowed £6.2 billion for house purchases, up 19% on February but down by 33% year-on-year.
A total of £6 billion was also borrowed by home owners re-mortgaging in March - up 13% on February and a 22% increase compared with the same period a year earlier.
But the CML said that, overall, home owner house purchase activity was at its weakest for two years across the first three months of 2017, with 155,900 loans advanced to first-time buyers and home movers in the first quarter of this year.
By contrast, the number of re-mortgage loans advanced to home owners was at its highest since the first quarter of 2009, with 106,700 loans handed out in the first three months of 2017.
Mr Smee said: "The relatively sluggish activity among home movers stands in contrast to the growth in first-time buyer and re-mortgage activity, but in aggregate the market is showing broadly the levels of activity we expected.
"As we head into the summer, we expect a continuation of these trends, with both first-time buyer and re-mortgage lending expected to maintain momentum in the light of the very attractive deals currently available."
A fresh mortgage price war has broken out in recent weeks, with some lenders offering some of their lowest ever rates.
Jeremy Leaf, a north London estate agent and a former residential chairman of the Royal Institution of Chartered Surveyors (Rics), said the figures show that "realistic buyers and sellers are getting on with their business".
He said: "Putting these and other figures into perspective, we are finding on the ground that those prepared to be realistic are buying whereas those who have not yet come to terms with changing market conditions are staying put."
http://www.msn.com/en-gb/money/homeandproperty/buy-to-let-lending-for-house-purchase-drops-by-almost-80percent/ar-BBBeccN?li=AAnZ9Ug
Now the "stress test" is usually 145% coverage at 5.5% - so rental income needs to be £665 pm. Lenders have obviously seen that there has been a decline is BTL's and so have recently relaxed the rules with some going back to 125% coverage or a "stress test" rate of 5% - especially if you take out a 5 year fixed rate. however, if you are a 40% taxpayer the coverage is still at 145% .
Also, they set a minimum earned income level at £25k - so retirees with low pension income looking to boost their incomes are being squeezed out.