City Centre Flat developments knowingly Oversold
Discussion
Digga said:
Although I reckon the ones I'd looked at were (from memory and been to sleep a few times since then) rentable and still would be.
Anything can be rented. Just depends on the price and whether you have a cats chance in hell of it covering the mortgage.Never understood the returns people expected to get on their rental portfolios though. You can pull deals together in our part of Florida for $30-50k homes rented out at $600-900pm; now that is a proper return on investment.
tinman0 said:
Digga said:
Although I reckon the ones I'd looked at were (from memory and been to sleep a few times since then) rentable and still would be.
Anything can be rented. I know Manchester, because I lived there for a number of years as a student and have friends there still. I also know Birmingham pretty well - friends there and the wife worked in the city for a number of years. Both of these cities had the same sort of boom development for flats which, in the irght bits of London, would [i[always[/i] rent, but in these provincial cities, in the numbers they were built, were never sensible.
FWIW, I am glad I didn't have the opportunity to have to find out how viable my BTL might, or might not have been.
Digga said:
tinman0 said:
Digga said:
Although I reckon the ones I'd looked at were (from memory and been to sleep a few times since then) rentable and still would be.
Anything can be rented. I'm willing to accept there can be some absolutely dreadful areas where you won't find a tenant, but the key is not to buy a property in that area in the first place, and if you do, then the price of the property should reflect the risk in not finding a tenant for love nor money.
However, a new build can always be rented (in this country at least), the key as always is pricing. People want too much, ergo, they can't find a tenant.
tinman0 said:
Price is wrong then.
I'm willing to accept there can be some absolutely dreadful areas where you won't find a tenant, but the key is not to buy a property in that area in the first place, and if you do, then the price of the property should reflect the risk in not finding a tenant for love nor money.
However, a new build can always be rented (in this country at least), the key as always is pricing. People want too much, ergo, they can't find a tenant.
absolutly correct.I'm willing to accept there can be some absolutely dreadful areas where you won't find a tenant, but the key is not to buy a property in that area in the first place, and if you do, then the price of the property should reflect the risk in not finding a tenant for love nor money.
However, a new build can always be rented (in this country at least), the key as always is pricing. People want too much, ergo, they can't find a tenant.
Anything will let at the right price.
robsti said:
20/20 hindsight is a great thing!
And lots of people on PH have it!
It didn't take a genius to see the bubble bursting, especially if you went through the last one. And lots of people on PH have it!
I work for a major property company. We changed our whole investment strategy way before the bubble burst, because the advice we were getting was that a downturn was on the way.
The clever money was out of property well before it hit.
superlightr said:
tinman0 said:
Price is wrong then.
I'm willing to accept there can be some absolutely dreadful areas where you won't find a tenant, but the key is not to buy a property in that area in the first place, and if you do, then the price of the property should reflect the risk in not finding a tenant for love nor money.
However, a new build can always be rented (in this country at least), the key as always is pricing. People want too much, ergo, they can't find a tenant.
absolutly correct.I'm willing to accept there can be some absolutely dreadful areas where you won't find a tenant, but the key is not to buy a property in that area in the first place, and if you do, then the price of the property should reflect the risk in not finding a tenant for love nor money.
However, a new build can always be rented (in this country at least), the key as always is pricing. People want too much, ergo, they can't find a tenant.
Anything will let at the right price.
As a developer having built many city centre schemes I can honestly say that we never colluded with valuers. The developer does set the price and if the units sell then other developers and valuers will use those units as a basis for valuation.
It then becomes a viscious circle as each new development will tend to inflate the price a little (its one of the ways you obtain best land value). These inflated prices are then justified to the valuer as the value is also measured as the price that a willing seller and a willing buyer agree on. Valuer looks at comparables hey presto mortgage offer is made and flat is sold.
The valuations are a snapshot and cannot be expected top anticipate a huge fall in the market owing to a sudden lack of mortgage finance which renders onward sales difficult.
As for service charge, it seem that both the developer and the surveyor got that one wrong and the surveyor should be culpable.
I don't think the surveyor can be culpable for a fall in the market.
It then becomes a viscious circle as each new development will tend to inflate the price a little (its one of the ways you obtain best land value). These inflated prices are then justified to the valuer as the value is also measured as the price that a willing seller and a willing buyer agree on. Valuer looks at comparables hey presto mortgage offer is made and flat is sold.
The valuations are a snapshot and cannot be expected top anticipate a huge fall in the market owing to a sudden lack of mortgage finance which renders onward sales difficult.
As for service charge, it seem that both the developer and the surveyor got that one wrong and the surveyor should be culpable.
I don't think the surveyor can be culpable for a fall in the market.
98elise said:
robsti said:
20/20 hindsight is a great thing!
And lots of people on PH have it!
It didn't take a genius to see the bubble bursting, especially if you went through the last one. And lots of people on PH have it!
I work for a major property company. We changed our whole investment strategy way before the bubble burst, because the advice we were getting was that a downturn was on the way.
The clever money was out of property well before it hit.
The thing about bubbles is they are at their most beautiful just before the POP!!!
98elise said:
It didn't take a genius to see the bubble bursting, especially if you went through the last one.
I work for a major property company. We changed our whole investment strategy way before the bubble burst, because the advice we were getting was that a downturn was on the way.
The clever money was out of property well before it hit.
We stopped buying land for City Centre developments in 2002 and were out of all the schemes by 2006. Perfect timing I work for a major property company. We changed our whole investment strategy way before the bubble burst, because the advice we were getting was that a downturn was on the way.
The clever money was out of property well before it hit.
loafer123 said:
superlightr said:
tinman0 said:
Price is wrong then.
I'm willing to accept there can be some absolutely dreadful areas where you won't find a tenant, but the key is not to buy a property in that area in the first place, and if you do, then the price of the property should reflect the risk in not finding a tenant for love nor money.
However, a new build can always be rented (in this country at least), the key as always is pricing. People want too much, ergo, they can't find a tenant.
absolutly correct.I'm willing to accept there can be some absolutely dreadful areas where you won't find a tenant, but the key is not to buy a property in that area in the first place, and if you do, then the price of the property should reflect the risk in not finding a tenant for love nor money.
However, a new build can always be rented (in this country at least), the key as always is pricing. People want too much, ergo, they can't find a tenant.
Anything will let at the right price.
Agreed, at a low enough rental, there will liekly be takers.
tinman0 said:
Never understood the returns people expected to get on their rental portfolios though. You can pull deals together in our part of Florida for $30-50k homes rented out at $600-900pm; now that is a proper return on investment.
Can you give some examples please - I want to persuade the Mrs to retire there.tinman0 said:
Never understood the returns people expected to get on their rental portfolios though. You can pull deals together in our part of Florida for $30-50k homes rented out at $600-900pm; now that is a proper return on investment.
A sensible level of return on a UK resi investment would be a running yield of 8% and an overall IRR of circa 13% once the property is sold on. The problem is that many people couldn't service the loans properly from the rent and were banking on short term equity growth. The problem is that a property play is not usually good a short term investment especially if you are buying near the end of an upward cycle. The cycle is roughly ten years.NoelWatson said:
tinman0 said:
Never understood the returns people expected to get on their rental portfolios though. You can pull deals together in our part of Florida for $30-50k homes rented out at $600-900pm; now that is a proper return on investment.
Can you give some examples please - I want to persuade the Mrs to retire there.2/1 will pull in $600pm, 3/1 or 3/2 will pull $800-900pm in our area.
Your rent is paid by the Federal Government, the tenant has to keep the property in good condition (your property won't be smashed up as the tenant will never get back on HUD if they do).
If you find somewhere near an airbase then demand will always be high for property, and if you can get an enlisted renter - absolute gold. One problem with a military renter and you complain directly to their CO and all hell breaks loose.
Gassing Station | News, Politics & Economics | Top of Page | What's New | My Stuff