Pinggoombah
Well-Known Member
No, but the accountants from the UK's least ethical, capitalist, money grabbing plcs seemingly do.
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Work starts on the eagerly awaited new Foxtons office on Brixton Road
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snowy_again
Slush
Cos that equation is based on making full income and doesn't account for voids, management costs, wear & tear, crazy expectations of clients?
leanderman
Street Party: July 2
Yes. It ignores costs and voids. But it is still a nice margin.
Few landlords pay tax on rental income because they set their mortgage near the level of the rent.
Or take the cash in hand. Like one in this road: £3,000pm tax-free and no mortgage!
5t3IIa
Registered User
Rushy
basically a scrotum
How do you know all their arrangements?
Have you shopped them? It's just one call:
http://search2.hmrc.gov.uk/kb5/hmrc/contactus/view.page?record=tRNNy6edopA
editor
hiraethified
What is up with that? Does anyone know?
It's a new landmass forming in front of our very eyes.
5t3IIa
Registered User
leanderman
Street Party: July 2
Tenants told me. I have not shopped the landlord.
Ms T
Honey-coloured ramparts
So they're not actually making any profit, other than the capital gain on the flat?
Monkeygrinder's Organ
Dodgy geezer swilling vapid lager
If you're covering your mortgage with the rent then you make a load of money on selling a property even without any capital gain.
Not aiming at you particularly but it strikes me as odd how often that point is missed when this sort of thing is discussed.
Ms T
Honey-coloured ramparts
Not if it's interest only.
Monkeygrinder's Organ
Dodgy geezer swilling vapid lager
Fair point but does anyone do that? Can you get a BTL mortgage on an interest only basis (or any mortgage these days)?
leanderman
Street Party: July 2
BTL mortgages are mainly interest only.
Landlords don't want repayment mortgages because there is no tax relief of the repayment bit.
They aim to break even and only have a tax bill until they sell up (which my mate did and then found an accountant to cut the bill to peanuts)
Of course landlords with loads of properties and equity in them should pay tax.
Monkeygrinder's Organ
Dodgy geezer swilling vapid lager
Ok that makes sense. But then why are rents far more than you'd pay interest on an interest only mortgage (and increasing regularly)?
leanderman
Street Party: July 2
Agent costs, contracts, repairs, insurance, wear and tear I suppose.
After that, they will have to pay tax on the difference.
But the property would also be put in the name of a non-working spouse to take advantage of a lower tax rate and tax-free allowance.
It may be that landlords shift parts of their domestic mortgage on to the BTL place too.
It's a very easy game to play it seems.
Monkeygrinder's Organ
Dodgy geezer swilling vapid lager
I'm sure there's all sorts of games they play. I don't believe those costs amount to anything like the difference though. In general to rent a place isn't a million miles away from the cost of a repayment mortgage (even if the place was bought for a lot less). I can't see there are many (any?) landlords out there charging mortgage interest + costs as rent.
leanderman
Street Party: July 2
That probably is now becoming the case.
Which makes private renting very difficult.
plenty of property funds are doing it
leanderman
Street Party: July 2
The madness continues:
http://www.standard.co.uk/news/lond...ctor-rents-8886268.html?origin=internalSearch
Seems to suggest that wages are so low, and private rents so high, that 47 per cent of working households in London rely on housing benefit.
It also backs up the social cleansing idea: the number of claimants in central London is falling while rising further out.
http://www.standard.co.uk/news/lond...ctor-rents-8886268.html?origin=internalSearch
Seems to suggest that wages are so low, and private rents so high, that 47 per cent of working households in London rely on housing benefit.
It also backs up the social cleansing idea: the number of claimants in central London is falling while rising further out.
leanderman
Street Party: July 2
And Hugo son-of-Malcolm Rifkind explains why in a cynical piece in the Times:
If buying a home is bad, renting is far worse
I'm a landlord myself, so I know. Why wouldn't we charge high rents if this skewed market allows us to?
Three years ago, with one kid already and another in what I probably shouldn't refer to as "the pipeline", my wife and I were trying and failing to sell our flat ... We took what felt like the foolish and perhaps downright irresponsible decision to remortgage to the absolute limit that our bank would allow and use the lump sum as a deposit on our new place. Renting the first out would cover the second mortgage, we reckoned, and we'd put it back on the market in a year.
Did we hell. A month in, I remember looking at a bank statement, at the figure going out, and the higher figure coming in — the one we'd settled for, not even the one the estate agent had advertised — and wondering whether somebody had made a mistake. One day the Rifkind finances may all go horribly wrong, like Ireland's did. But until then? It's money for nothing.
Such is the soaring lunacy of London property that ... even for the mildly loaded there are killings to be made. That flat I found in Camberwell, up top? Equivalents seem to be worth about £350,000. If you could find a deposit of £50,000, your interest-only mortgage payments would set you back about £1,000 a month — two thirds of the rental price.
What, though, to do? Taxing buy-to-let more heavily could help but might push up rents. Rent controls sound appealing only until you speak to any economist. The best thing you can say for the faintly maniacal Help to Buy scheme is it might provide a brief lull
But when the market sets a price, who'd be the fool not to charge it? In London, the price is high for the reason that prices are always high, which from my GCSE economics I remember to be too much demand chasing not enough supply. We don't have enough houses. We need to build more.
If buying a home is bad, renting is far worse
I'm a landlord myself, so I know. Why wouldn't we charge high rents if this skewed market allows us to?
Three years ago, with one kid already and another in what I probably shouldn't refer to as "the pipeline", my wife and I were trying and failing to sell our flat ... We took what felt like the foolish and perhaps downright irresponsible decision to remortgage to the absolute limit that our bank would allow and use the lump sum as a deposit on our new place. Renting the first out would cover the second mortgage, we reckoned, and we'd put it back on the market in a year.
Did we hell. A month in, I remember looking at a bank statement, at the figure going out, and the higher figure coming in — the one we'd settled for, not even the one the estate agent had advertised — and wondering whether somebody had made a mistake. One day the Rifkind finances may all go horribly wrong, like Ireland's did. But until then? It's money for nothing.
Such is the soaring lunacy of London property that ... even for the mildly loaded there are killings to be made. That flat I found in Camberwell, up top? Equivalents seem to be worth about £350,000. If you could find a deposit of £50,000, your interest-only mortgage payments would set you back about £1,000 a month — two thirds of the rental price.
What, though, to do? Taxing buy-to-let more heavily could help but might push up rents. Rent controls sound appealing only until you speak to any economist. The best thing you can say for the faintly maniacal Help to Buy scheme is it might provide a brief lull
But when the market sets a price, who'd be the fool not to charge it? In London, the price is high for the reason that prices are always high, which from my GCSE economics I remember to be too much demand chasing not enough supply. We don't have enough houses. We need to build more.
leanderman
Street Party: July 2
And, to keep up the monologue, a chart showing that rents in Lambeth are rising but less than in some other parts
http://www.rentonomy.com/posts/133
http://www.rentonomy.com/posts/133
Monkeygrinder's Organ
Dodgy geezer swilling vapid lager
A Borough is a fairly arbitrary area to look at for these things tbh. Probably easier for data collection but not really how things actually work. Also it makes the point that the high increase in costs in Tower Hamlets is apparently caused by large quantities of new build - not the same as high increases in costs of existing properties.
That said it does reemphasise that ultimately the problem is housing as a whole, more than any Brixton specific bubble.
leanderman
Street Party: July 2
Yes. I was intrigued by the Tower Hamlets paradox. I guess it's because the area - and I lived there - may have had a majority of lower rent social housing and now has a majority of higher rent new builds.
leanderman
Street Party: July 2
Got trendy when we left!
CH1
"Red Guard"(NLYL)
Spotted my first Foxtons board on Somerleyton Road earlier today. 3 bed house (described by Foxtons as 4 bed). £450,000 
leanderman
Street Party: July 2
SarfLondoner
KenDoddsDadsDogsDead.
Next to a train track so no doubt it will be described as "vibrant"
gaijingirl
Well-Known Member
vibrating more like..
mind you I live opposite a train track with very deep sidings so it's actually "leafy"
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