Are all BTLs at risk of this costly mess
Discussion
By far the biggest risk to BTLs is that of a tenant deciding/realising that it's all rather easy to stop paying rent in contrast to trying to stop shopping or keep bailiffs away.
It can still take up to 12 months to get one out and there are plenty of BTL punters who wouldn't be able to finance their property speculation without the tenant's rental income, let alone pay for the costs.
This DM article is a bit of a red herring and detracts from the real risk many amateur landlords who are running too much leverage if we do get any significant rate rises over the next decade. Rising costs plus the rising risk of income default.
It can still take up to 12 months to get one out and there are plenty of BTL punters who wouldn't be able to finance their property speculation without the tenant's rental income, let alone pay for the costs.
This DM article is a bit of a red herring and detracts from the real risk many amateur landlords who are running too much leverage if we do get any significant rate rises over the next decade. Rising costs plus the rising risk of income default.
I thought this was a well know thing assured tenancy that if you live in place renting it for x amount of years, you then have the right to stay renting it and even pass it on to your family. I lived in a house where property next door was worth circa £750k and the guy had been renting it for over 20 years and some low rate and the landlord could do nothing and the family living there can now pass it on to his kids. I would of been well annoyed if I was the landlord.
Just some fag packet maths, let's say the average yield where that house is is 4%, if rent is £10/annum then the value of the property to an investor is £250k. They sold it for that. So no actual problem.
The issue seems to arise from the buyer wanting to raise the rent by 50% so as to automatically pocket what would be a near £100k gain overnight and wanting the vendors to do this for him?
Why didn't they tell the buyer to jog on and find another investor willing to buy a pretty solid and secure yield?
The issue seems to arise from the buyer wanting to raise the rent by 50% so as to automatically pocket what would be a near £100k gain overnight and wanting the vendors to do this for him?
Why didn't they tell the buyer to jog on and find another investor willing to buy a pretty solid and secure yield?
I have five properties now and would under no circumstance think about buying a property below market value and then thinking it's an easy lease to make some cash then sell at market value for profit.
This is just a case of someone trying to be very greedy, can't have their cake and eat it etc.
This is just a case of someone trying to be very greedy, can't have their cake and eat it etc.
DonkeyApple said:
Just some fag packet maths, let's say the average yield where that house is is 4%, if rent is £10/annum then the value of the property to an investor is £250k. They sold it for that. So no actual problem.
The issue seems to arise from the buyer wanting to raise the rent by 50% so as to automatically pocket what would be a near £100k gain overnight and wanting the vendors to do this for him?
Why didn't they tell the buyer to jog on and find another investor willing to buy a pretty solid and secure yield?
Because the rent isn't inflation-linked, as far as I could tell, so this income needs to trade 150 bps wider than market (nerds with bloomberg screens could tell you the exact number).The issue seems to arise from the buyer wanting to raise the rent by 50% so as to automatically pocket what would be a near £100k gain overnight and wanting the vendors to do this for him?
Why didn't they tell the buyer to jog on and find another investor willing to buy a pretty solid and secure yield?
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