No sign of U.K. BTL being anything other than a sustained good investment despite naysaying from lawyers whose aversion to acclimating assets explains why they’ll always be slave to the wage (or the drawings, which FYI is same as a wage so check ur ego)
Sir Woke XR Re… 29 May 23 12:15
Reply |

nul txt

I can't make the numbers add up. No doubt there's a bite point at which it's worth it but the extra sdlt/lbtt and loss of income tax relief have killed it off as a prospect for me.

Yeah I'll always work 

It's what the working classes do 

Mainly charity work and a few bits and pieces. Quite fancy a job at the Tesco tills. Go full circle. Keep the brain ticking over 

The yields don’t really work Even on cash buyer basis it looks anaemic - say you manage it yourself and don’t pay agency fees you’re still doing well to get more than 5%. Given 6 month SONIA is >5% why would you touch it?


Doing it on a cash basis is missing the point. The whole point is the leverage you can get at interest rates which are strongly negative in real terms. I am not sure I would buy right now though. The risk of a sharp short term nominal price fall is fairly substantial I would say. 

Because of the shrinking rental stock, rents are soaring.  Even after the abolition of the 10% wear-and-tear allowance, mortgage interest relief and introduction of the Stamp Duty Surcharge, its still profitable.  If you plan to keep your buy-to-let for, say 25 years, the annual rent will keep creeping up.

Yeah that is why we will keep ours. Essentially you buy with as much debt as you can put on it and still have it wash its face on an interest only basis and then sit there waiting for inflation to do its magic. 

I’m expecting to be sitting on my life savings in cash fairly shortly after some ahuftying involving refinancing the impending house purchase. As well as spaffing sixty grand on a silly car I’m tempted to use much of the rest as the deposit on what would be a goodly number of rental flats in eg Manchester, though I’d be tempted to spread risk across locations.

sitting on your life savings in cash btw is, assuming you’ve done ok, fairly worrying if you have any interest in UK bank solvency 

Further note. if you look at people who have got rich and kept getting richer - they always lever it to fvck. 

There are obviously yield advantages to going regional (and that is getting much more important with rates shooting up) but I would be very reluctant to buy in a city I didn't know very well (like lived in it for years well). It's really difficult to judge areas without having lived somewhere and voids are what really fvck up your numbers. Strictly inside zone 1/2 London for me. 

I know it's painful with inflation so high but if I were you Laz I would sit on the cash. Cozy up to some agents and make it clear you can move fast as a cash buyer. I reckon there may be some real deals around later this calendar year/H1 of next. 

Buy cash then leverage up after acquisition to get the others. 

Interesting point, Cat Man Do. Will think on it, along with my sins obv. You’re right about the current inflationary burn making it painful to be in cash, but poss also right about being brave where others are fearful.

Another thing I’m looking at is buying out a local business from retirement. I know of three retail businesses in sevenoaks that have or are shortly to close down due to retirement and not being able to find a buyer. The biggest was a hardware shop. now gone although the freehold is up for sale and would still have the goodwill if you moved quickly. One is a children’s shoe shop that used to have something of a regional reputation, One is a children’s dancewear shop, not home turf for me and rather niche, but the three females in my family are all dance fans and it does seem to me to have some potential to build a brand, in a gymshark kind of way, tho admittedly more niche

I do  debt free BTL and I know to some people its financially illiterate, but i do it through a company, I own and its a good way of storing value risk free.  I think doing it with debt is bold in this market.  The main pull is the protection of capital aligned to the housing market - so in real terms you are "in" the market whether it goes up or down - and as such, it doesnt really matter too much.  But in the meantime you're taking a few grand a month and its pretty tax efficient with a non-working wife on the payroll - who can salary sacrifice her and payroll her way to make it work.  

I think to build a retail brand, you need to be massively passionate about what you do.  There are lots of industries you go into because you love it - and as a consequence you make money and do well.  You can't look at being the next unicorn as the end game as you will 99% fail if that's your aim. 

The only people who angst on rental yield are the ones who can’t get into BTL.

Rezzie is about two things: inflation-busting gains and guaranteed income. 

Unkle’s tip: never sell.

PS You might want to buy Clifton.

The main pull is the protection of capital aligned to the housing market - so in real terms you are "in" the market whether it goes up or down

This is one of the reasons that I don't like it tbh. Most people are already significantly invested in the property market with the equity in their main property, is it wise to also be exposed via BTL equity too? Unless of course you have enough cash that you are not only mortgage-free on BTL property but you are also well-diversified in other areas which may well be the case

Buying a shoe shop with the plan to make a success of it is a much more interesting thing to do with your money than buying a load of BTL flats IMO, though the expected value is probably much less

The way i look at it is that if i have capital worth say £X at today's prices.  If i have no debt and its worth 1/2X tomorrow - then everyone else's will be worth half two - and I will still have my asset and it will continue to provide a return.  Its unlikely to be worth say 20% less than it is now in a worst case scenario - and if that's the case, I am happy.  Shares on the other hand - one of the funds my pension is made up of, has lost 70% of value this year.  Now, i have maybe 8 funds my pension is in, so its swings and roundabouts.  

I have also found as a cash buyer, i am able to transact quicker and be flexible with timing on sale which tends to mean better capital return (the way you make easy money on property is buy buying it from a willing seller and selling to a willing buyer).  

Lolling hard at the idea that some junior law firm blozzpartner in any meaningful way "owns" the business.

no - as long as they are paying the rent and otherwise not trashing the place.  Any rent reforms are likely to make bad tenants easier to remove - whereas typically good tenants are not a problem and welcome to stay as long as they are keen to continue to pay their rent. 

Do  any of you not have any moral scruples about contributing to the poverty of people who can't afford the ridiculous rents they have to pay?


Yes, I know the counter arguments, re lack of supply of rental properties, lack of institutional  - public or private landlords, cost of mortgages etc, and I'm sure you all make good landlords, but.........

BTL is so much hassle for your average city lawyer 

If you are only interested in cap returns then that's a bit different

The only properties I have letted out are too friends and family


Agree with Davos here - if you value your free time at all BTL is a lot less appealing. I’m sure it works well with a non-working spouse but I cannot face dealing with a plumber on a Tuesday morning whilst at my actual job because a student flat in Manchester suddenly has a leak. It clearly works and works well, particularly for those who got in early and levered hard, but I’m not up for the sheer life fook of it when a well balanced portfolio doesn’t actually require me to sort out boilers and dripping taps.

How the fvck does renting someone a house make them not be able to afford to buy it fgs

 I cannot face dealing with a plumber on a Tuesday morning whilst at my actual job because a student flat in Manchester suddenly has a leak

You don’t actually have to worry about this at all, it can all be managed by agents (for a price of course…)

Managing Agents taking their cut reduces your profit, which in turns puts people off becoming BTL Landlords

didn’t we do this thread the other day?

lolling at all the bullishness over the housing market (yes what a great place to “store value risk free” 🤣)

but mostly lolling over the idea of laz opening a children’s shoe shop 

It’s not risk free

but it’s part of living in a free market

the alternative is Cuba or Moscow or china 

No I blame richer people for creating an overpriced market from which poorer people will never escape 

I ended up an accidental landlord when i moved as I originally planned to come back. I'm selling up as I had a bad experience with the last tennants. I love the property but it is GII listed and needs an owner occupier.

18 viewings, the majority (12 or so) were BTL purchasers. I accepted a marginally lower offer from a first time buyer over a a full offer from a BTLer so it doesn't end up being rented again.  Given the number of viewings and the number of BTL viewers, I don't see BTL interest going down, but this is just a single snapshot of one ppty from the last 3 weeks.

There’s a very interested flat on Downleaze in Bristol I nearly bought a few years ago. Been in the sellers’ family for millennia etc type deal. Only it turned out to be a flying freehold and therefore unmortgageable and hence likely unsellable. Sellers said you did the legal and well drop the price 10 grand. I’m like, no, you did them and I’ll pay the asking. It died. Never did sell. According to Rightmove. Huge place overlooking Durdham Downs. I had my guys ready to go in and totally reimagine it as well. 

Aside for the free market argument, anyone who has moved jobs, moved locations, got divorced, gone to university away from home, arrived in a new country must accept the need for a functioning private rental sector.  People need more flexibility in their ability to move than the system allows (sdlt / the slow nature of the system / agents costs / physical moving costs).  

Are we supposed to stay in one place? 
are we supposed to stop moving to other parts of the country?

do we stop immigration and emigration?

do we ban couples from getting divorced?

or do we ban estate agents and cut sdlt.  ?


it’s easier to reject the politics of jealousy 


I've had to rent. Most landlords corrupt - won't fix things, won't keep to an affordable rent etc.

But this is really a check your  privilege thread, isn't it?

You cannot say this market is working, when a cafe worker, has to pay £2,000.00 a month rent for a small property in Beckton ffs.

An affordable rent is what the tenant can afford to pay and they have to tailor their location accordingly.

BTL hasn't worked in London for decades but can still make sense elsewhere but as Donny said you need to know the town because they are lots of shysters offering great deals but on properties that will only ever attract a certain kind of tenant.

To avoid the hassle you need a team of reliable tradesmen that you know so that you can just call them and give them the keys to get it sorted.