GrollySTI

It hasn't had no impact - just not as much as you are trying to imply.

Having worked for 20 yrs in the property industry I am coming from an educated and experienced standpoint.

You?

scoobynutta555

I'd say BTL has quite a significant affect on the market. I know some people with 50-60 houses which they rent out. These properties all tend to be in the same area, and of similar design ie terraced housing. Then there are others like me with not so many properties in the same market, added together BTL must make up a significant part of the market. I'd say the majority of BTLs are either 2-3 bed terraced houses or flats, both of which a high % of FTBs must purchase or indeed be in their price range.

If there is a significant rise in interest rates expect property barons with massive mortgages to bite the dust. When somebody with 50 plus houses drops out at once thats a hell of a lot of property in a localised market.

MikeCardiff

iTrader: (2)

Dont agree with the point about FTB's being able to afford to buy - OK, they may be able to afford an ex council flat on the local slum estate, but would YOU buy one ?

Point is that FTB's cant afford to buy in the area they want on their budget. Not all FTB's in the past have just bought whatever is the cheapest, they have bought within their budget - for some this will be a 1 bed flat in a dodgy part of town, for others it will be a 2 or 3 bed semi in a suburb. For those that can afford to buy at the moment, what they can get for their money is a lot less than they could get 3 or 4 years ago.

Prices of ALL houses have gone up, but earnings havent gone up in line with them, which means a large sector of potential buyers get priced out of the market ( this isnt a particularly hard concept to grasp, and is why lenders HAD to start offering more than the traditional 3.5x rate ), whatever they are looking for.

For people who already own and are moving this isnt such a problem as their house has gone up as well, so the difference between what they are selling and buying isnt anywhere near as big as the difference for a FTB between what a house cost 3 years ago, and what it costs now.

Brit_in_Japan

In continental Europe there is a much lower rate of home ownership. They just don't see it as necessary to own the place they live. Of course there is a much greater supply of lower cost rental accommodation, which changes things somewhat.

In the UK, especially when property prices have been jumping up at much greater rates than inflation, they are no longer homes, they are investment opportunities. Investment and speculation have helped to drive house prices upwards, no question.

OllyK

You've just contradicted yourself. They CAN afford to buy, they're just being picky and want a house that's beyond thier means. You don't see people demanding Ferrari drop their prices because your 18 year olds can't afford them. If you want to buy something, you buy what you can afford - simple as.

Indeed - so revise your expectations, either in terms of budget, location, or more likely both.

Sure - but they can still afford to buy something, it's just a run about rather than a Ferrari.

And because people are setting their sights above their station as it wouldn't look good to their mates if they lived in a grotty bedsit.

I posted a link earlier - 3 bed semi - £72K, which would suit a couple. Combined income of £24K (that's only 12K each) and they could afford a 100% mortgage at 3 times combined salary. OK, it isn't too pretty and it isn't in the best location in the world, but easily commutable to Nottingham and Derby by bus and a train station is a few minutes walk away.

Luan Pra bang

So ollyk you would pay 72k to live in a crime ridden rat infested **** hole when there is very little chance of a significant increase in its value for years so you could be stuck there for ages when you could rent a nicer place for less than the mortgauge costs. Also for a person alone on 15k its not such an easy stretch. The fact is houses near here that were 5k 25 years ago are now 130k Wages have not increased anywhere near that amount but you don't see any problem ?

Mungo

If that's all you can afford and you HAVE to be a homeowner, then YES!!
My first car cost £250. It was a clapped out 15 year-old thing that had 40bhp. It was all I could afford, but that was that. I didn't borrow £25k to buy a new BMW, because I thought it was my right to drive something flash.

Even now, I would really like a 5-bedroom, 4 reception detached house with double drive and 150ft garden in a nice private road. But I can't afford it, so I "make do" with what I can afford. If you're at the bottom of the ladder and can't afford to buy, you rent. Simple as. It's the way it's been for decades and until recently nobody had their nose out of joint as a result of renting.

OllyK

I'd probably rent - but that's the point, if you can't afford to buy a house that offers everything you want, you have to compromise, not whinge that you can't afford it.


But if your on your own, why do you need a 3 bed house? Have a 1 bed flat for £45K instead

davyboy

Fukc me that looks grim!

Most likely for people who can not afford Nike trainers.

OllyK

Maybe - but better than Cotmanhay. The point is however, that you have to start at a point on the ladder that you can afford if you insist on owning a house. If you don't like it, you work hard and can start a little higher up. The attitude since NL have been in seems to be that people think the world owes them a living, well cash and a house anyway.

IMO, the government should ensure everybody has somewhere warm and dry (even if it's a hostle) and should have sufficient food to stop you starving, after that you make of it what you can.

scoobynutta555

Looks like the kind of place you'd see flak jackets on the washing line

OllyK

There's some bloody snobs on here
Here ya go, even cheaper 1 bed for £30K

davegtt

As much as Im seeing your point Olly thats only a 25% share the 30k flat

**** paying 30k for a quarter share in a 1bed flat no matter who I was

OllyK

Blimey - bargains galore
2 bed for £25K

OllyK

Missed that bit - thought it looked a bit nice for the money!

Luan Pra bang

thats the point why work your **** off so you can live in a council etate hovel when you can sit on your **** and have a council estate hovel given to you ?

GrollySTI

Ask any estate agent what proportion of sales are BTL and it will be fairly low.

scoobynutta555

Yes they probably are. But what proportion of sales of flats and terraced houses are BTL?

A quick google search reveals

"an increasing number of new purchases are driven by wannabe landlords – yes, even now, despite historically low yields. Buy-to-let investors accounted for one in ten new mortgages for house purchase last year, according to the CML. And by the end of 2005, the buy-to-let sector accounted for 8% of outstanding mortgage debt, the highest ever."

So assuming this figure is correct, and the 8% FTB figure is correct mentioned earlier, the BTL market is actually bigger than the FTB market.

OllyK

Or look on the BBC website

Lust4Life

Most sensible thing I've read in a while.

Hear hear.

Phil

paulr

Absolutely true.I'm sure i heard that something like 40% of all recent price rise was down to people buying "investment" properties.

paulr

Yeah,but Olly,you have to admit it DOES look grim.

OllyK

Sure, but why do people on £20K seem to think they should be able to afford a 5 Bed detached with a couple of acres of paddock. The point is, if you must own your own house, you still can and for a competetive price. If you don't like the area, then buy it, and rent it out and carry out renting yourself, at least you're on the ladder.

Petem95

I dont think people on £20k think that. But when you have a scenario where you FTB's in the South on £50k (more than double the national average salary) can only afford a 2bed ex-council flat, then what are those on lower salarys supposed to do?

OllyK

If their choice was buy or live on the street I'd perhaps sympathise. While I agree that everybody should have a roof over their head, I don't agree that they chould have to own it.