Trying to buy a house in this area is near impossible

[Blackcurrant]

Loz Wrote:

-------------------------------------------------------

> Mustard Wrote:

> --------------------------------------------------

> -----

> > It's also on the market to rent for ?2700 pcm.

>

> That is a gross yield of 3.5% on a value of ?975K.

> Who'd enter the BTL market at the moment?

Given the speed at which supply is currently rising, I suspect investors are starting to take profits and very few are buying.

[StraferJack]

Loz does rather make it sound as if it's the owner/landlord who is getting the shitty end of the stick here

"a man, right.. .he came in to my office and told me this house was for sale at 950k. And i could rent it for 2700 pcm... i thought that's CRAZY!! The gross yield is blah blah blah..... but my objections were useless.. he MADE me buy and let it out. And meanwhile.. MEANWHILE! my tenant is sitting pretty with a paltry rent in SE London"

[Loz]

No, just pointing out that entering the BTL market at the moment is highly risky. That yield is gross - take out the various costs of renting a property (the largest which will probably be any mortgage) and any profit on rental will be close to nil. You are much better off to be investing that money in other areas.

Add into that the fact that London property prices are due for a potential correction, so there is a reasonable capital risk here as well.

So, your missing-the-point sarcasm aside, what would you consider a 'fair' rent to be on a ?975k house?

[LondonMix]

Cost to refurb, fit out and convert the loft was probably more than 90k. But yes, developers have yo pay stamp duty and capital gains tax.

Jeremy Wrote:

-------------------------------------------------------

> Sue Wrote:

> --------------------------------------------------

> -----

> > House in Ulverscroft Road:

> >

> > Sold for ?630,000 on 24th Feb 2014

> >

> > Was in need of "improvement". Improved.

> >

> > Now on the market for ?975,000 (sic).

> >

> >

> http://www.zoopla.co.uk/for-sale/details/33255606

>

> Loft conversion + cheap and cheerful refurb...

> 90K? 345K gross profit... woah.

>

> Do developers have to pay stamp duty AND income

> tax?

[StraferJack]

Honestly, I believe no one should be paying a million quid just to let the house out

Multiply that by all the others doing same and the house wouldn't be best part of a million quid in first place

[Loz]

StraferJack Wrote:

-------------------------------------------------------

> Honestly, I believe no one should be paying a

> million quid just to let the house out

>

> Multiply that by all the others doing same and the

> house wouldn't be best part of a million quid in first place

Wouldn't it? These houses for rent aren't lying empty. The demand for housing is there - whether it be for rent or to buy, so if you took away the rental market you would still have the pressure on prices.

This is why I think all the anti-BTLers are mistaken. There seems to be a belief that if you get rid of BTL then prices will magically come down. But the problem is total housing supply, and reducing BTL won't change that.

It's notable that the Beeb today did a article on 10 ways to cool the housing market - and lowering BTL wasn't one of the ideas.

[DaveR]

Loz, you're banging your head against a brick wall here. I've been asking for someone to articulate the moral/ethical case against BTL forever and it always comes down to 'its greedy to own more than one house'. Essentially, SJ and his ilk think that anyone (private individual or business) who makes a profit from residential letting is exploiting people's need for a roof over their heads. Like all those shopkeepers who make a profit from selling food - bast@rds! And what about clothes shops!!

[PokerTime]

I think the main objection to BTL (with mortgage attached) is the resentment felt by renters at paying off someone else's mortgage with a more than a sizeable chunk of their salary each week. The immorality felt is in that those already with property can borrow to get another to rent out, whilst it becomes increasingly harder for first time buyers.

But we've always had wealthy private landlords soaking up property, and they are all buying to let. BTL with mortage, is a relatively small chunk of the rental market. 80% of rental properties have no mortgage attached at all, so have either been bought outright, or paid for already. BTL is higher in London, but so is the percentage of people renting (some 48% as opposed to 30% nationally).

Has BTL been a factor in driving prices up? Not on its own, but it has contributed to the bouyancy of the market. Of the 40% of former council properties bought under 'right to buy' now in the hands of landlords, a good percentage were bought under BTL.

Grodon Brown was warned as early as 2003 about 'Buy to Let' and potential impacts.

http://www.renegadeeconomist.com/news/the-guardian-treasury-saw-buy-to-let-threat-to-first-time-buyers.html

For all the discussion around the depletion of social housing for example, there is the other issue of the squeezing of the middle-classes. If those people become priced out of the London housing market, then it really is in trouble.

[Jeremy]

DaveR Wrote:

-------------------------------------------------------

> Essentially, SJ and his ilk think

> that anyone (private individual or business) who

> makes a profit from residential letting is

> exploiting people's need for a roof over their heads.

I'm probably somewhere in between you and SJ on this one... there is a clear demand for rental property in London, so clearly a need for landlords. In theory there is absolutely nothing wrong with BTL, the problem is that it's usually motivated by appreciation of value rather than a steady return on investment.

[StraferJack]

Someone equates investing and profiting from housing with food retail and gets a pass??

If people with more money and food than others bought food from the shops and lent it at a premium to people who couldn't afford it.. (who would then have to give it back) then your "anaolgy" might start to make sense

A natural balance of sales and letting is desirable - the current skewed market (where people were fortunate to make a lot of money on previous bubbles get first dibs on new stock) isn't

It's not a difficult concept, but some people are so complacent they have zero idea of the reality. They think they could repeat whatever pattern they followed in the 80s (or whenever) - get a job, a house share, a flat, a bigger flat, a house etc

[adonirum]

Quote "Sue"......"I can't be arsed to walk down the road" How damned rude, and especially as you gave a side swipe at me earlier in this thread about being selfish. That comment is hardly loaded with altruism. Further quote "though maths isn't my strong point" Seems like good manners isn't, either.

[Otta]

Whoa, easy tiger. I wasn't actually expecting anyone to get their shoes on and go and look. I wouldn't be arsed doing that either.

[adonirum]

Yeah...point taken Otta.

[Sue]

adonirum Wrote:

-------------------------------------------------------

> Quote "Sue"......"I can't be arsed to walk down

> the road" How damned rude, and especially as

> you gave a side swipe at me earlier in this thread

> about being selfish. That comment is hardly loaded

> with altruism. Further quote "though maths isn't

> my strong point" Seems like good manners isn't,

> either.

xxxxxxxx

Eh??

Pots and kettles, I think, adonirum.

Seems your ideas of rudeness and good manners differ from mine, however.

ETA: And when did I "give a side swipe" at you about being selfish? To the best of my knowledge, you said that the rise in house prices in my road were a good thing for me, and I said that I was looking at the wider picture.

If I said I wasn't selfish, and I can't remember my exact wording, I certainly wasn't having a go at you.

I'm not quite sure why you have suddenly chosen to publicly attack me in this way?

ETA: And I hardly think being too tired to put my shoes on and walk down the road to look at a house number to satisfy somebody else's curiosity on a forum equates with preferring a lower rise in house prices for the sake of all the people who can't afford to buy one, even if that means I make a rather less massive profit if I sell.

Plus I know the person I addressed the "can't be arsed" remark to and would have been gobsmacked if he had been in any way offended by it.

And what on earth is in any way rude about saying that maths isn't my strong point?? That's putting myself down, not anybody else.

I think you owe me an apology, actually.

[Sue]

StraferJack Wrote:

-------------------------------------------------------

> Honestly, I believe no one should be paying a

> million quid just to let the house out

>

> Multiply that by all the others doing same and the

> house wouldn't be best part of a million quid in

> first place

xxxxxxxx

But the house hasn't been sold yet at a million quid.

If it's currently up both for letting and for selling, maybe the current owners are seeing whether they get a buyer or a tenant first?

ETA: Or is the situation that it is being advertised as a buy-to-let with a potential income of ?x? In which case I completely missed the point and I apologise for any confusion in my posts!

[adonirum]

Sue...To answer your points...You quoted what I had posted and then added..."Maybe I'm looking at the wider picture and not from a selfish viewpoint". As my post had mentioned rises were good for US, I took that to be a side-swipe at me, as oppossed to a direct attack/insult.As you have taken the trouble to explain that this was not the case, then I am happy to admit my interpretation on this occasion may have been misplaced( You know the sort of thing..assume..who's the ass etc). Thank you for pointing out that you were not having a go at me.

I am sorry if you feel I have publicly attacked you.

I do not understand the second of your paragraphs suffixed ETA.

If you know the person whom you addressed the remark to, that's fine and thus it was wrong of me to comment. However, had you posted something like "You know me Otta can't be arsed etc" then others (myself included) would have realised it was a bit of banter between friends.

Unfortunately, a lot of comments on forums/chatrooms etc can get misinterpreted as we are unable to hear the tone of voice, see the body language etc.

Hope this answers the points you have raised, I am now going to log off for today and go and read a book.

Sorry, that should have read "second of your paragraphs prefixed ETA"

[LondonMix]

SJ, housing is no different to food. A farmer has more food and sells the excess that needs to be bought repeatedly by non-farmers.

One could argue no one should have more land than they need so everyone could have arable land and produce their own food etc.

The only difference is that most people don't want to farm while many renters want to own in this country and can't. In much of the world renting is a lifestyle choice that is fine because of stonger tenancy rights.

If you want to moan, moan about that.

[StraferJack]

Anyone with two pennies to run together can get their own food (in 2014 with food banks, not even that)

Well paid people often cannot get their own house

There is zero comparison

Everyone but everyone drives food prices down

Half the housing market wants (even needs) prices up and the other half down

Completely different

[LondonMix]

People who buy food do not own the means to produce food. The example is exactly the same. People paying someone else for a temporary satisfaction of need.

Owning a home is the equivalent of owning land to produce food. Renting shelter is the equivalent to buying surplus food from someone else.

Most people can rent even if they can't buy just as most people can buy food even if they don't own the means to securely produce food for themselves for life.

No difference.

[PokerTime]

I'm with SJ on this. Housing is not comparable to food, because of that difference in affordability. Where they are similar though, is that they are both items all humans need. We forget that when it comes to housing some time ago it seems.

[PokerTime]

But many people can't afford to rent LM. Have you looked at the number of people in full time jobs needing HB? Or the number of people being evicted because they can't meet the rent? There are hostels and B&Bs full of people that LAs can't find affordable rented accomodation for.

[LondonMix]

No one has ever fogotten that Poker.

Also, farmers benefit from increasing food prices and manipulate the cost of food by controling output. Consumers benefit from falling costs.

For everything in life that is sold- food, shelter, clothing the equation is the same.

[LondonMix]

Poker time, food is not affordable for everyone everywhere. In many places a families food bill can exceed their housing costs.

[PokerTime]

I don't agree. The cost of feeding a family of four (without luxuries admittedly) is never more than the cost of renting a home for a family of four. Food banks exist because people are being left without benefits and because families are left with nothing for food after paying bills, including rent.

[binary_star]

'Housing benefit' should not exist.