Given the opportunity would you become a buy-to-let landord?

[AnnO'Neemus]

Nah! The morally repugnant people are the ones with spare rooms who don't rent 'em out.. while asylum seekers live in hotels..

I have two spare rooms. Aside from the fact that a roof leak caused structural damage and I'm having to sue my landlord to force them to carry out the repairs so they're currently uninhabitable, I now have a policy, after some bad experiences, of not inviting people to stay in my flat who have been referred to me with a sob story by a neighbour.

Horror story #1 A vague aquaintance, has nowhere, let her stay in my flat. I don't smoke, tell her smoking only on the balcony please. She smokes dope in bed, burns my sheets. When I confront her, she's like: what's your problem? I'll buy you some new sheets! (load of bollocks, she didn't) My problem was that she was damned lucky not to have burned my flat down.

Horror story #2 Friends of a friend of a friend... they're having to leave the shared house they're in, I'm told they need somewhere for a couple of weeks while they find somewhere else. They move in and tell me their name is on the council housing list and they've been told they'll probably get a flat in about five months! They leave a packet of dope on the fire. I ask them not to, because the police might visit to follow up a breaking and entering and I don't want them to see stuff like that if they turn up. This couple also start having 'domestics' arguing and being frosty with one another. It turns out she's pregnant and having to have an abortion and that's why she's stomping about my flat and slamming doors. I don't even know this couple, they're not even my friends, I just took pity on them being homeless and they've been a nightmare. I ask them to leave. The chap threatens me, tells me: You don't know what f***ing Paki you're messing with, it won't be me, but watch yourself, because someone's going to get you. (NB: He referred to himself as "paki") Btw, they were staying in my flat as 'guests', rent free, because I was on an introductory tenancy at the time and didn't want to jeopardise it by having lodgers, which wasn't allowed, and that's the thanks I got.

Horror story #3 Poor international student on a scholarship from South Africa (value of rand v. sterling is pants). He's a friend of a neighbour who knows I have a couple of spare bedrooms. I take pity on him and tell him he can stay rent free (bearing in mind his impoverished state), in return for helping me to paint the spare room. Before he can get round to doing this, I'm away in London and I get a call saying my neighbour below is going to break into my flat because there's a leak coming from my flat flooding his kitchen. I phone the student chap to ask what's going on, it turns out he'd turned on the washer without putting the drain pipe over the sink. He's also gone away. His attitude? I'm not there, what do you expect me to do about it? I have to pay for a train from London, go home, sort it out, pay compensation to the neighbour with the flooded kitchen, pay for a night in an hotel (because there's no spare room). Altogether, this chap who was staying rent free in my flat cost me £200. And he was apparently 'unhappy' that I asked him to leave.

Horror story # 4. Again, friend of a neighbour who knows I have spare rooms. This guy takes the p!ss, doesn't wash his pots. I'm away studying and come back about once a fortnight, ringing him in advance to let him know I'm coming home. Does he tidy up? No. I'm sure he things I was telling him I was coming home so he'd know to leave things a mess for me to clean up after him. In the end, I had to tell him, I'm not your mother, I'm not your wife, and I'm certainly not your maid. Did it make any difference? No. His girlfriend came to stay the weekend, he created twice as many dirty pots and left them. I really drew the line at cleaning up after someone who didn't even live in my flat. On top of which, he f***ed around with the radiator valves in my flat, breaking them, causing the radiators to leak and causing about £300 worth of damage to carpets.

Following those experiences of disrespect and damage to me and my home, I couldn't give a toss if a homeless person/asylum seeker was sleeping in the gutter outside my front door, I wouldn't take them in.

 

[Hollis]

Following those experiences of disrespect and damage to me and my home, I couldn't give a toss if a homeless person/asylum seeker was sleeping in the gutter outside my front door, I wouldn't take them in.

You are entitled to your opinions.

 

[AnnO'Neemus]

You are entitled to your opinions.

Calling it an "opinion" makes it sound like a firmly held belief Hollis.

I think it's more appropriate to consider it a position I've been (unhappily and reluctantly) forced to adopt due to bad experiences.

Calling it an opinion makes it seem as though I've been a hard-hearted b@stard right from the word go, whereas it's the opposite way round, I've been a total soft touch for people in homeless predicaments who've then gone on to take the p!$$, it's just that I feel I've learned my lesson the hard way not to be such a sucker.

 

[bluestreak]

Tell me about it. Ever had a plumber come round yer house?



There's undoubtedly crap landlords about. But then alot of their market isn't necessarily the 'long term poor'.. People just setting out on lifes journey.. you know people over from Spain for a year, just moved down to London, don't want to stay in London long term, going to move in with their girlfriend..etc. You can't see it just in strict classist terms.

i think you're wrong - the majority of the market is the long-term poor, with the others used to justify such endeavours.

 

[bluestreak]

In London the prospective returns just don't justify the burden of Landlordism...

you what? in which case house prices in london should be falling as all the landlords get rid of their houses. not happening. people need to live in london, and most people don't earn enough to buy. i'd be willing to be that 50% of the population of london live in rented accomodation. if there's no return there why do landlords do it? and what exacly is the burden of landlordism? getting 1000 pounds a month fall into your account in return for ignoring the phone calls asking you to fix the fucking heating? such a burden. i could do fuck all for a damn sight lower wage than that. i've been in the rental market for a decade now (well, nine and a half years or so) and i've only had one landlord in all that time who i'd consider to be not a thieving useless parasite, and they weren't in london.

and to top it all off, if there weren't any landlords, there wouldn't be letting agents, who are if anything even greater leechs than landlords.

 

[twisted_angel]

So d'you work in London, and, err, if so, d'you think the market's saturated now?

No i'm not in london, property prices are stupid there.

 

[bluestreak]

What about if you actually built a house and then rented it out?

You've increased the housing supply.. so whats the problem?

why not just sell it so someone can live in it and own it?

TA - do you rent to non-students or people who couldn't afford to buy houses? are you renting in london? if the answer is yes then no matter how you dress it up i'm sorry but you're helping to keep the poorest people out of the marketplace. you might be one of the good landlords but by creating a demand so that some people own lots and others own none. letting is fine if you have a choice, but for most of us the choice is rent at exhorbitant rates or sleep on the streets. when landlords buy up loads of houses and thus increase house prices and demand amongst those who don't have anywhere to call their own they are effectively profiting from removing choice from the poorest members of society.

maestrocloud argues with me on this one. she believes that career landlords aren't bad - they provide a professional service and understand their responsibilities, but she blames the whole buy-to-let culture for the massive amount of bad landlords who see the house as an investment and the tenants as nothing more than cash cows. i suppose she has a good point, though my inner revolutionary is stamping his foot and waving his rifle around!

 

[moose]

I let out my flat for 5 years when we bought a house, because I couldn't sell it. It was an absolute pain in the arse - nightmare tenants setting fire to stuff, calling out electricians to change lightbulbs, and flooding the place. Never again!

 

[twisted_angel]

why not just sell it so someone can live in it and own it?

TA - do you rent to non-students or people who couldn't afford to buy houses? are you renting in london? if the answer is yes then no matter how you dress it up i'm sorry but you're helping to keep the poorest people out of the marketplace. you might be one of the good landlords but by creating a demand so that some people own lots and others own none. letting is fine if you have a choice, but for most of us the choice is rent at exhorbitant rates or sleep on the streets. when landlords buy up loads of houses and thus increase house prices and demand amongst those who don't have anywhere to call their own they are effectively profiting from removing choice from the poorest members of society.

maestrocloud argues with me on this one. she believes that career landlords aren't bad - they provide a professional service and understand their responsibilities, but she blames the whole buy-to-let culture for the massive amount of bad landlords who see the house as an investment and the tenants as nothing more than cash cows. i suppose she has a good point, though my inner revolutionary is stamping his foot and waving his rifle around!

No i don't rent to non-students or in london, the properties i have are nr the uni in town, i was first approached by a friend who was looking for cheap and cheerful housing nr the uni as alot of the rooms are charged at silly prices, its a job bluestreak, i am earning a wage to live on and they are getting the housing they need, and as for the properties i buy then sell on im not doing anyone out of anything, or keeping people from getting on the property ladder, alot are lazy when it comes to housebuying with more money than sense, the other week i brought a house at auction, within days i had a buyer offering me £15000 more than i paid for it without me even touching it, he was a first time buyer! i stupidly explained how he could save money and took him to an auction to see for himself, maybe i should have took his money, but i couldn't.
I see where you are coming from in a way but to be honest i don't care now, i have struggled as a single mum for almost 14 years, i have worked damn hard so i didn't have to rely on benefits, i have gone without, my kids have gone without and now i have found a legit way to make money and i'm loving it!

 

[Hollis]

you what? in which case house prices in london should be falling as all the landlords get rid of their houses. not happening. people need to live in london, and most people don't earn enough to buy. i'd be willing to be that 50% of the population of london live in rented accomodation. if there's no return there why do landlords do it? and what exacly is the burden of landlordism? getting 1000 pounds a month fall into your account in return for ignoring the phone calls asking you to fix the fucking heating? such a burden. i could do fuck all for a damn sight lower wage than that. i've been in the rental market for a decade now (well, nine and a half years or so) and i've only had one landlord in all that time who i'd consider to be not a thieving useless parasite, and they weren't in london.

and to top it all off, if there weren't any landlords, there wouldn't be letting agents, who are if anything even greater leechs than landlords.

Yeah.. but in alot of cases that £1,000 will go straight out the door again in interest payments.. or the bulk of it. Looking at the London market it does seem satuated. £866 a month for a 2 bedroom furnished house, 10 minutes from the tube. - So you saying £430 each for a couple.. I used to pay up to £370 a month for a poxy room in a shared house 8-9 years ago.

People probably do it because (a) they've got the money, (b) property prices were rising astronomically, (c) the stock market was performing shite (d) the end of final salary pension schemes.

You're also taking on board the risk that it won't be let & you end up paying the mortgage yourself...on top of your own.

You're also taking responsibility for the maintenance and upkeep of the property..

And for dealing with tenants..

 

[_angel_]

People are always going to need rented accommodation - students spring to mind and young people who don't want to buy somewhere and get a houseshare so I don't have anything against it.


If I was to theoretically do this (no chance ) I'd want to stipulate that people on benefits could apply because you really are a second class citizen when it comes to rentals - and, well anything really.

Can imagine the hassle of crap tenants could be a very real reason to put people off though.

 

[scooter_uk]

I'm not a greedy capitalist wanting to take advantage of the poor, I'd want to rent out the property at a reasonable rent, i.e. enough to cover mortgage and running expenses, my aim would not be to make a killing with extortionate rents.

What about voids, damage, allowing for interest rate rises?

I just figure pension plans are a bit of a scam. So many people have paid into pension schemes over the years, only for the company or its executives to dip their sticky fingers into the pie, meaning there isn't enough money at the end of the day for the pensioners, or alternatively, the rules of pension schemes are changing, to reduce the pension payable.

There are risks but they're not a scam. It's just a wrapper - I wouldn't open an ISA/bank account with someone without checking the business credentials and I would monitor it to make sure I knew what the management were doing along the way. You should have a few different pension pots (personal pension plans/self invested pensions/occupational) so that an 'Equitable Life' doesn't leave you in poverty.

I don't want to make a massive profit,

You're right, otherwise your Capital Gains Tax on your secondary property would be huge, even with Taper Relief. Don't forget too the legal costs associated with buying and selling, a buy/sell spread of 10% approx and ongoing maintenance costs.

You're choosing an asset that will be purchased with net salary and borrowed monies. The real mortgage interest rate will be c. 7.5% and it's being compared to a pension where you contribute gross, can diversify, pay in monthly, and be free of income and capital gains tax. There are ethical pensions as well so cash doesn't have to be in evil firms that deal in death.......

Not saying you're wrong to proceed but you should analyse the choices in more detail

Scoot

 

[bigbry]

Where do we get this "I couldn't for moral or ethical reasons" - you're prespared to see families homeless because there are not enough properties in the public sector to rent and not everyone is in a position to buy so the private sector fulfils a social need in the 21st century.

I rented about six years ago from a private landlord for about 15 months - he didn't rip me off. I paid market price rent for that type of property in my area, my (few) complaints were dealt with promptly and fairly and at the end he came in walked round the property to check it was OK and handed me my deposit back. Maybe I was lucky but the point I'm making is not every landlord is a rip off merchant trying to take some poor suckers for a ride.

 

[mellowmoose]

... its interesting I read somewhere recently that there's alot of women who've ended up as property millionaires..

yup my mums one of them

.. if there's no return there why do landlords do it? and what exacly is the burden of landlordism?

The astronomical rises we've seen in London have stablised somewhat in the last couple of years because rental income barely covers interest rates now.

 

[mellowmoose]

.... career landlords aren't bad - they provide a professional service and understand their responsibilities, but she blames the whole buy-to-let culture for the massive amount of bad landlords who see the house as an investment and the tenants as nothing more than cash cows.

I think they're both bad. Housing is a basic human need, much like food. Anyone who makes a (large) profit, either through capital gains or rental income, from providing housing is IMO a vulture.

There is nothing intrinsically wrong with bieng a landlord as long as the rental market is heavily regulated, as was the case pre-thatcher. Making a small return is fine but making a killing on such an essential need as housing is crimminal.

Over the last 20 years Property has just become another commodity subject to market forces & that must change,

 

[vipper]

There is nothing intrinsically wrong with bieng a landlord as long as the rental market is heavily regulated, as was the case pre-thatcher. Making a small return is fine but making a killing on such an essential need as housing is crimminal.

The rental market is becoming more regulated. There are additional controls being introduced next year on Health and Safety by the ODPM - minimal standards basically.

IMHO I think there is a need for social housing and private rental. I don't see why the state (which like it or not is based on a capitalist economy) should pay to house people who are capable / able to house themselves privately however I do believe the state should house those in need or who cannot afford to live where they work, e.g. key workers.

 

[myname]

Unfortunately landlords and people buying second homes can get access to tax breaks that people renting cannot, and access to borrowing more money, so it becomes even harder for people without a home to access enough money to start out.

In the long term people renting end up with no security, often poor housing (as most landlords take the cheapest option for the work they do on the house, and also often just put work off for years and years), and higher outgoings on housing than people who are able to buy (rent is often higher than the mortgage repayments).

This means that as time goes on they are less likely to be able to build up a large enough deposit to ever get on the housing ladder, and they are poorer day to day than homeowners, they can't borrow against the house, or take a rent holiday if something comes up that makes money tight. And at the end of it all the tenants have paid for the landlord to own a house which they can use to have a reasonable retirement maybe, but the tenant is left with no home, no money and probably a lot of resentment about having paid for someone else to own what they're locked out of.

It's an unfair situation whereby the poorest are paying for those better off than them. No wonder there's so much misery, and mental illness in this society when the less well off are pushed ever further into insecurity and loss of control over their lives.