I know, I was trying to make these very points in my post. I admire John for his approach but I'm the sort of soul that likes his own little nest and fixed comforts around him and I'm not quick to change. Hence, for me, it's not a game I'd be prepared to play even though I think I'd have good judgement at it once I had turned my attention to the matter. I also suspect the upheaval with children would be a factor for many people.

John would be crazy to buy a house now! That would completely undermine all the efforts he has put in thus far as there is no way we are at the bottom of the curve!

I recall a few weeks/months ago on Property Ladder there was an asian guy in London (drove a scooter) who had built up a property portfolio worth millions but he was still pretty much maxed out on all of them for lending. I'd love to know his equity position now!! He may well be....as they say.....FACKED :D

I'm staggered you can rent a 400K property for £800 a month, thats a seriously bad return for the owner, similar houses here are at least twice that

I know isn't the standard rental return you should seek 10% PA. (i.e. £3333 pcm). Even 5% is double what John pays. 2.5% return is terrible!

Rents and house prices de-coupled ages ago.

House prices went up because people were allowed to borrow large amounts of money relatively cheaply. As house prices were rising, more people got onto the ladder so that they wouldn't miss the boat, which further increased house prices.

The same is not true for renting. Generally speaking, people don't borrow money to pay for the rent, so there wasn't the same capital available for paying rent, and people don't have to get on the "rent ladder". Also there's a lot of rental property standing empty at the moment.

It's all very well saying "I want 10% return on my BTL", but if the rental market will not support such a rent, then you're going to have a void at 0% return instead, unless you lower your rent to the market rate.

John's landlord might have bought ages ago, so his effective return on his capital invested might be higher than the 2.5% suggested by the current gross yield.

That's true. He might have bought it at £96k and has been achieving a fat 10% for years :D I guess the point you are making is that you can't know if a deal is good or bad for the landlord unless you know his initial stake.

It was bought in 1969! I'll try to post some exterior piccies later, think you'll like it. I do, the interior is tired except for the reception rooms, and we've had to do a lot of cleaning.

Jammy git ;)

Nice :)

Some of the turns in that driveway might be driftable in 'gravel' mode :D

Agreed it will be longer than a year, but in a years time property will really be a dirty word. Sentiment will have changed so much that alot of people will have forgotten property ever being 'a dead cert'. At this point it will be time to start to look, establish relationships with the surviving estate agents etc And so looking to pounce in perhaps 18 months time, it must be done whilst there is 'still blood on the streets' not once sentiment starts to change.

imho!:)

we have a property thats only had 3 viewings (with no offers) since May last year. It's now down to £99,950 from £109,950.
now on our third agent to try and se it, but even they said nothing is moving apart from people desperate to sell and taking silly offers just to sell.
We need to sell it as it's now empty cus we've moved into our new place in april. So the equity from that sale would help loads.

I've also got 6 BTL properties, one been empty since 12th May, only one viewing. Normally it rents out withing the 1st week or two. Even dropped it £15 a moth too to try and get more interest, but still no one ringing from the adverts.
Two of the BTL's have mortgages coming upto the end of their fixed term, one of them will increase by about £150 a month come September 08, the others gone up by about £50 a month.



So we are watching everything we spend, tightened the belts, not had a holiday since our honeymoon in November 2006. Don't go out for dinner now, unless Father in Law pays (lol) or its two4 £8 at the local :( but not done that since March.

I've not bought any new clothes for ages and I only let Jo buy sale stuff from tesco or TK Maxx. :(


Don't even start me on why I'm still driving 699cc basic Smart car 4.5years on from selling a scoob!!! :lol:





So yes, you do now know someone who is watching what they spend cus of the credit crunch the newspapers have talked us all into.

Hmm, that is very interesting indeed. Anecdotal evidence of house price crash not resulting in increased rents?

Whereabouts are your BTL's if you don't mind telling us?

Also, roughly how long do you reckon you can hold out before you have to put the BTL's on the market?


Note, I realise the questions above are very personal, so wont be offended if you don't want to answer :)

all the BTL properties I have are aimed at first fot on the ladder renters/moving out of mam/dads etc, as this market will always be there.
God help those who are rying to let out mid price houses, these are the ones who are being hit the most.

5 of them are studio apartments in Nottm, city centre area. Handy for work and all under £400 a month. Max value of the property £65k (what I'd look at selling at or there abouts)


I can hold out and run with two empty (as I am now) but all the others are on 9month contracts or have been with me almost 2yrs, so not looking like moving on just yet..... we hope :lol:

the plan is to sell one by one later this year (nothing t do with the credit cruch) so I can move on and buy else where. manly cus i'm sick of the lease hold situation with the building and the managing agent doing bog all for £1k a year service charge.

But value for money even with the £1k service charge, the rental return on the BTL mortgage is very good.

there are properties at £100k in Nottm city that only get £50 a month more than I get. I did the maths and the bottom end property was my better rental return on my outlay.


The trouble is, lots have jumped on the BTL band wagon, then their BTL mortgage interest rate has gone up and they hink they should put the rent up to compensate he % rate hike.
thats not how renting out works.

Phil, if you don't mind me asking are your BTLs on interest only or interest + capital repayment mortgages?

No, the BLT are all interest only. most had 25% deposit put down, so nothing is at the max ;) thank god ;)

Our local paper (we are in a leafy,wealthyish suburb of Birmingham) contained property pages this week with about 1/5 devoted to sales and 4/5 the rental market.

Rentals used to be hidden at the end of the Houses for sale section and used tobe just a few

simple reason for that Loz is properties aren't selling so a lot of agents are pulling adverts. My brother in law sells the property pages for our local paper and the agents have sold next to nothing in the last few months. The wise ones are pulling adverts and the ones that want to run them are on stop for failure to pay for them. Rentals have been brought forward as they are whats left and somthing they hope will keep them going

Phil, I don't want to be a doom monger or do a 'Nacro' but there is pain ahead.

1) I think it will be the first timers who stop renting. They are the ones who can easily carry on staying at their parents whilst times are hard.

2) The prices could easily drop 25% which would leave you with nothing (though I presume they have gone up since purchase and so price would have to drop more than 25%)

3) When the property price drops the BTL deal will change. The rent may now not equate to 125% of the mortgage payment and hence the next lender will not lend or charge you a huge arrangement fee. There is also a chance that your existing lender can hold you in breach of the covenant of the mortgage when the property is valued lower because its in the small print that the value is regularly monitored. This would be unlikely if you are making the payments but it is a legal right of the mortgage company to be able to do so

All of the above means BTLs that are costing money to run and producing nothing ie no capital gain

Right, my wife and I bought our first property together back in August 2006, It's a 2 bed apartment on a new development site. As I understand, these sort of properties should suffer less of a fall than your average detatched property simply because people dont mind living without luxeries such as a garden if it will save a few pennies. Our 2 year tracker mortgage is coming to an end and looking at the new proposed 3 year fixed from the halifax, our mortgage is going up by around £40 a month. We didn't stretch our budget when we bought for exactly this reason.
We are looking at staying here for another 3 years atleast.

So, to all you so called experts out there, are we f&cked or not? :wonder:

"No, you tell him"... <looks at shoes>

I also don't want to be a harbinger of doom, but I'd say new builds in general are more likely to fall (of course, this is all in my opinion, so I might be wrong).

1. You pay a premium because it's all brand new, and you will not be able to charge that if you come to sell it.

2. There's also a glut of new builds in some places (with lots of empty flats). This will put downward pressure on prices.

3. The builders themselves will undercut you if they have any unsold stock to keep turn-over.

4. I think we're likely to see a fairly constant percentage knocked off on most properties. I think that people set a sum for what they want to spend per month in living costs. If this sum can stretch to the "next one up" (in this case a house instead of a flat), they'd buy the house instead, unless the flat was really competitively priced (i.e. flat prices fell).
Or as another example, why would anyone buy a 1 bed flat, if they could afford a 2 bed comfortably, unless the 1 bed was a lot cheaper (I know you're in a two bed already, but it works the same way from 2 bed flat to 3 bed flat, or to a house etc).

Edit: Point 4 is after taking into account point 1, as well.

IMO, of course. Not an economist, so may be wrong etc etc :)

all depends how many similar properties have been built and how many are in the pipeline, round us they have thrown similar ones up at prices similar to older 2 bed terraced houses with gardens etc. There are now too many all built and sold at the top of the market and now developers are trying to off load the remaining stocks. If you're happy to stay you're fine but if you were to want to sell it may not be easy. We're in a time where no one knows what is going to happen HBOS is predicting a 9% drop this year which would be ok. There are a lot of people sitting back waiting to buy at "bargain" prices so a lot depends when they start getting back on the ladder, as when they do we'll get a bounce back in prices.

well its picking up here, I've just soted out a tennant for my empty flat..... DHSS.... getting people on social is the way to go. ;) Already have two who the council pay the rent.... every 4 weeks :)

So I now only have one fat empty and I'm gutting that. So as long as the others stay let we'll just about manage.

During the last recession my parents rented out their flats to DHSS for years. It is a bit of hassle because they do on the whole happen to be a 'different' kind of person. They had an iv drug abuser and a prostitute living there at one time!
Also got stung for rent quite a few times because they would tell the council to start paying the rent directly to them (not to my dad)

I'm in the rental market again, having to move out of the place we currently rent off a friend.
Anyway , i've noticed no increase in rental prices and a glut of properties to rent in the west london area. The good ones are going quickly but just as fast as they disappear another appears in its place.
There are also numerous large new build apartment complexes all over the shop around here which are standing empty or almost empty due to no-one buying them. I wouldn't rent in one either because I don't want to live in a ghost town.
From prices i've seen the 3-4 bedroom houses seem to be suffering the most in rental prices , they're not much more than a 2 bed/2 bath flat now and are very attractive to someone like me.
I'm quite looking forward to snuffling round a few places when I come back off my holidays next week.
On the other hand I see new For Sale boards popping up all over the place, for a lot of people I know this credit crunch has come at a time when their 2-3 year mortgage deals are up and the increase is just too much for them to handle on their maxxed out payments.