BTL - long term winner?
Discussion
98elise said:
Why do you assume BTL landlords are avoiding tax? Mine are all accounted for properly on my Tax return, and I pay tax on them. If HMRC knows of people avoiding taxes, it would act now and get the money now.
Income from BTL is taxed just like any other income.
I wouldn't be surprised if many BTL landlords weren't paying tax on their rental income, many don't even seem to be able to landlord properly so I haven't much faith they trouble themselves with trivial matters such as paying tax. After all, how many self proclaimed 'landlords' on this forum do you see posting stuff like "my tenant stopped paying his rent, can I throw his stuff out into the street and change the locks?", "my tenant damaged something, can I keep his deposit?", "my tenant is complaining his boiler doesn't work, am I obliged to get it repaired?".Income from BTL is taxed just like any other income.
TTwiggy said:
Fittster said:
TTwiggy said:
Fittster said:
Isn't it an obsession because many people consider property in one form or another to be a significant part of their pension planning. Being interested in how you are going to fund your old age doesn't seem unreasonable.
Of course not, but we have a situation (at least in London and the SE) where even reasonably well paid people can't afford to buy. The BTL boom is at least partly complicit in this. I live in a block of new builds near Greenwich. I am one of only four owner-occupiers in a block of 30 flats. The rest are all BTLs.
s off the 26 landlords so more people could buy their own property?Realistically, the horse has bolted, but maybe allowing BTLs in the first place was just a bad idea?
Oakey said:
98elise said:
Why do you assume BTL landlords are avoiding tax? Mine are all accounted for properly on my Tax return, and I pay tax on them. If HMRC knows of people avoiding taxes, it would act now and get the money now.
Income from BTL is taxed just like any other income.
I wouldn't be surprised if many BTL landlords weren't paying tax on their rental income, many don't even seem to be able to landlord properly so I haven't much faith they trouble themselves with trivial matters such as paying tax. After all, how many self proclaimed 'landlords' on this forum do you see posting stuff like "my tenant stopped paying his rent, can I throw his stuff out into the street and change the locks?", "my tenant damaged something, can I keep his deposit?", "my tenant is complaining his boiler doesn't work, am I obliged to get it repaired?".Income from BTL is taxed just like any other income.
http://www.theguardian.com/money/2014/mar/15/landl...
If this figure is accurate then it would account for about 50% of all BTL landlords. The figure can't be that high can it?
Edited by BlackLabel on Tuesday 22 July 21:29
TTwiggy said:
Fittster said:
TTwiggy said:
Fittster said:
Isn't it an obsession because many people consider property in one form or another to be a significant part of their pension planning. Being interested in how you are going to fund your old age doesn't seem unreasonable.
Of course not, but we have a situation (at least in London and the SE) where even reasonably well paid people can't afford to buy. The BTL boom is at least partly complicit in this. I live in a block of new builds near Greenwich. I am one of only four owner-occupiers in a block of 30 flats. The rest are all BTLs.s off the 26 landlords so more people could buy their own property?Realistically, the horse has bolted, but maybe allowing BTLs in the first place was just a bad idea?
People used to have a choice, and the was still a bouyant rental market (returns were better returns than now). Places like the US have very cheap housing, and still have a good rental market.
If you could buy a property you liked for a reasonable price, how many would moan about BTL?
TTwiggy said:
Mark Benson said:
TTwiggy said:
Fotic said:
TTwiggy said:
I imagine the answer is simple. Their 'problem' lies in financing someone else's loan for them, while that person sits back and makes money on the asset.
I think most tenants are more realistic with their finances and how the world works than you. Why is paying off an individual's mortgage any worse than paying off a corporate loan taken out by a housing association for instance? Why is renting a house any different to buying a commodity - if you have a problem with people making money from other people, how do you earn a living?
Edited to add: Housing is not just any 'commodity' though. Shelter is a basic human need. It's not the same as renting telly or a PS4.
Edited by TTwiggy on Tuesday 22 July 17:16
Houses have been commodities for centuries, its only the late 20th century thats seen boom in private ownership.
fblm said:
Art0ir said:
House buyers under 30 (as a share of all house buyers) is at an all time low.
What do you think?
The UK has roughly 70% home ownership, compared to France around 60%, Germany 50% and Switzerland 40%... What is Brits problem with renting? Why are BTL's a problem and why are an increasing number of renters a problem? Doesn't seem to be an issue with the rest of the continent.What do you think?
And in answer to Cranked... beats BARC or TSCO!
Edited by fblm on Tuesday 22 July 16:17
Our lad is a landlord currently with a flat and a three bed house, returns are around 9%. A good investment toward his pension.
The U.K. has a property owning mindset developed over decades, even the Chinese and Russians can see the merit in buying property here.
98elise said:
Food is a basic human need, but do you feels its wrong for a private individual to take a business loan, buy a butchers shop, and make money from selling a basic human need?
Houses have been commodities for centuries, its only the late 20th century thats seen boom in private ownership.
Butchers sell you food, they don't rent it to you.Houses have been commodities for centuries, its only the late 20th century thats seen boom in private ownership.
TTwiggy said:
98elise said:
Food is a basic human need, but do you feels its wrong for a private individual to take a business loan, buy a butchers shop, and make money from selling a basic human need?
Houses have been commodities for centuries, its only the late 20th century thats seen boom in private ownership.
Butchers sell you food, they don't rent it to you.Houses have been commodities for centuries, its only the late 20th century thats seen boom in private ownership.
The reason is that food is not is short supply. If we were struggling to find food, then the concept of a resturaunt owner cornering the market in food, and selling it at 400% mark up would be terrible.
Its the same with houses. When they are in ample supply, and its your choice to rent or buy, then the private landlord is someone providing a service without any public money being involved. When houses are in short supply then they are seen very differently.
The problem is supply and freedom of choice, not the fact that someone wants the invest in property as a service to others. There is nothing fundamentally wrong with someone providing a rental property, to someone who wants to rent.
98elise said:
Private renting has been around for 100's of years, thats not the problem. The problem is the lack of building land/property causing high prices, which takes away the choice to buy or rent.
If there really were a shortage of housing, surely rents would also have increased ahead of earnings?http://www.bondvigilantes.com/blog/2014/07/01/stam...
I would suggest the issue is down to lax lending and too low interest rates.
BlackLabel said:
Oakey said:
98elise said:
Why do you assume BTL landlords are avoiding tax? Mine are all accounted for properly on my Tax return, and I pay tax on them. If HMRC knows of people avoiding taxes, it would act now and get the money now.
Income from BTL is taxed just like any other income.
I wouldn't be surprised if many BTL landlords weren't paying tax on their rental income, many don't even seem to be able to landlord properly so I haven't much faith they trouble themselves with trivial matters such as paying tax. After all, how many self proclaimed 'landlords' on this forum do you see posting stuff like "my tenant stopped paying his rent, can I throw his stuff out into the street and change the locks?", "my tenant damaged something, can I keep his deposit?", "my tenant is complaining his boiler doesn't work, am I obliged to get it repaired?".Income from BTL is taxed just like any other income.
http://www.theguardian.com/money/2014/mar/15/landl...
If this figure is accurate then it would account for about 50% of all BTL landlords. The figure can't be that high can it?
Edited by BlackLabel on Tuesday 22 July 21:29
98elise said:
Why does it matter how you are profiting. They are making a profit on something that you need, and need more than shelter. Resturants work on a 400% mark up, on something you cannot live without for about 3 weeks. Why are we not outraged at the owners, especially the small independant ones that are trading in life or death?
The reason is that food is not is short supply. If we were struggling to find food, then the concept of a resturaunt owner cornering the market in food, and selling it at 400% mark up would be terrible.
Its the same with houses. When they are in ample supply, and its your choice to rent or buy, then the private landlord is someone providing a service without any public money being involved. When houses are in short supply then they are seen very differently.
The problem is supply and freedom of choice, not the fact that someone wants the invest in property as a service to others. There is nothing fundamentally wrong with someone providing a rental property, to someone who wants to rent.
Good post.The reason is that food is not is short supply. If we were struggling to find food, then the concept of a resturaunt owner cornering the market in food, and selling it at 400% mark up would be terrible.
Its the same with houses. When they are in ample supply, and its your choice to rent or buy, then the private landlord is someone providing a service without any public money being involved. When houses are in short supply then they are seen very differently.
The problem is supply and freedom of choice, not the fact that someone wants the invest in property as a service to others. There is nothing fundamentally wrong with someone providing a rental property, to someone who wants to rent.
...and, I think, quite to the point of the problem / issue / debate.
I think long term BTL is still a sensible option for many. But obviously it's not a hassle free investment and you need to find the right property that has sustainable yields. I don't think people are going to be able to rely on big house price growths to mitigate low yields, at least not in the long term (IMHO). In recent years even the most naive landlords have done OK, saved by the housing market recovery, but I think looking 10-20yrs down the line it's not going to be easy and the naive will most likely suffer.
As with any investment, I certainly don't think it's a good idea to use it as a sole investment. I wouldn't want to rely on our frankly nonsensical housing market for all my future security!
As with any investment, I certainly don't think it's a good idea to use it as a sole investment. I wouldn't want to rely on our frankly nonsensical housing market for all my future security!
98elise said:
TTwiggy said:
Fittster said:
TTwiggy said:
Fittster said:
Isn't it an obsession because many people consider property in one form or another to be a significant part of their pension planning. Being interested in how you are going to fund your old age doesn't seem unreasonable.
D
Of course not, but we have a situation (at least in London and the SE) where even reasonably well paid people can't afford to buy. The BTL boom is at least partly complicit in this. I live in a block of new builds near Greenwich. I am one of only four owner-occupiers in a block of 30 flats. The rest are all BTLs.D
s off the 26 landlords so more people could buy their own property?Realistically, the horse has bolted, but maybe allowing BTLs in the first place was just a bad idea?
People used to have a choice, and the was still a bouyant rental market (returns were better returns than now). Places like the US have very cheap housing, and still have a good rental market.
If you could buy a property you liked for a reasonable price, how many would moan about BTL?
Mr Snap said:
But my daughter has been repeatedly fleeced by agencies and unscrupulous landlords inventing damages and keeping deposits. She can't afford to fight them legally or to 'lose' her good references, so many of them seem to be utter scam artists.
When was this? The various mandatory deposit protection schemes in place the last 6-7 years make it a PITA for landlords to recover costs, let alone fraudulent ones and challenging deductions is free and very much weighted in the tenants favour. Secondly what references? You don't need to have references from previous landlords for anything. The law is weighted in the tenants favour and you don't need a penny to challenge your landlord, disputes are arbitrated by the deposit schemes for which the landlord pays. Jesus after many years of multiple rentals and never deducting a penny, I wanted to make a small deduction for cleaning last month and my agents advised against it just in case they challenged it despite already agreeing to pay for a bed they destroyed. Not to put too fine a point on it if it were my daughter getting fleeced multiple times I'd be thinking she's not exactly telling me the whole story!Edited by anonymous-user on Wednesday 23 July 05:34
lamboman100 said:
BlackLabel said:
Oakey said:
98elise said:
Why do you assume BTL landlords are avoiding tax? Mine are all accounted for properly on my Tax return, and I pay tax on them. If HMRC knows of people avoiding taxes, it would act now and get the money now.
Income from BTL is taxed just like any other income.
I wouldn't be surprised if many BTL landlords weren't paying tax on their rental income, many don't even seem to be able to landlord properly so I haven't much faith they trouble themselves with trivial matters such as paying tax. After all, how many self proclaimed 'landlords' on this forum do you see posting stuff like "my tenant stopped paying his rent, can I throw his stuff out into the street and change the locks?", "my tenant damaged something, can I keep his deposit?", "my tenant is complaining his boiler doesn't work, am I obliged to get it repaired?".Income from BTL is taxed just like any other income.
http://www.theguardian.com/money/2014/mar/15/landl...
If this figure is accurate then it would account for about 50% of all BTL landlords. The figure can't be that high can it?
Edited by BlackLabel on Tuesday 22 July 21:29
I've just bought a house for around the 120k mark, with 26k deposit. I have a tenancy agreed at £650 (but the house could achieve £700). The mortgage is around the £325 mark.
Thats nearly 4k profit per annum on an investment of 26k, and thats ignoring any capital gain. I have 4 similar properties, and they are all making the same sorts of profits. I'm completely happy with my "tiny" profits.
There are of course a few repair costs, but these really are minimal, hence the fact I'm paying tax on profits.
lamboman100 said:
BlackLabel said:
Oakey said:
98elise said:
Why do you assume BTL landlords are avoiding tax? Mine are all accounted for properly on my Tax return, and I pay tax on them. If HMRC knows of people avoiding taxes, it would act now and get the money now.
Income from BTL is taxed just like any other income.
I wouldn't be surprised if many BTL landlords weren't paying tax on their rental income, many don't even seem to be able to landlord properly so I haven't much faith they trouble themselves with trivial matters such as paying tax. After all, how many self proclaimed 'landlords' on this forum do you see posting stuff like "my tenant stopped paying his rent, can I throw his stuff out into the street and change the locks?", "my tenant damaged something, can I keep his deposit?", "my tenant is complaining his boiler doesn't work, am I obliged to get it repaired?".Income from BTL is taxed just like any other income.
http://www.theguardian.com/money/2014/mar/15/landl...
If this figure is accurate then it would account for about 50% of all BTL landlords. The figure can't be that high can it?
Edited by BlackLabel on Tuesday 22 July 21:29
Vanity purchasers? unlikely I would suggest, nothing beats a sports car in the vanity stakes
fblm said:
When was this? The various mandatory deposit protection schemes in place the last 6-7 years make it a PITA for landlords to recover costs, let alone fraudulent ones and challenging deductions is free and very much weighted in the tenants favour. Secondly what references? You don't need to have references from previous landlords for anything. The law is weighted in the tenants favour and you don't need a penny to challenge your landlord, disputes are arbitrated by the deposit schemes for which the landlord pays. Jesus after many years of multiple rentals and never deducting a penny, I wanted to make a small deduction for cleaning last month and my agents advised against it just in case they challenged it despite already agreeing to pay for a bed they destroyed. Not to put too fine a point on it if it were my daughter getting fleeced multiple times I'd be thinking she's not exactly telling me the whole story!
It's happening now. My daughter suffers from a mental health disorder that means she's incredibly trusting & honest, she would be mortified if she'd actually damaged anyone's property. She's nearly 40, has a full time job and wishes to be completely independent, but she's pretty much doomed to remain in student type properties as her mental health problems aren't bad enough to put her into sheltered accommodation (I call it 'lack of care in the community').Edited by fblm on Wednesday 23 July 05:34
What the law states and what is actually happening on the street in Brighton (where there are thousands of students fighting over limited amounts of property) are not necessarily the same thing. Agents do insist on references and deposits are regularly held back, I'm sure they might easily capitulate but that doesn't stop them trying it on.
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