EU Trying To Kill Buy To Let – sign the petition to STOP it now.

EU Trying To Kill Buy To Let – sign the petition to STOP it now.

14:24 PM, 19th November 2011, About 10 years ago 100

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The buy to let market will grind to a halt if EU proposals to change the way lenders hand out mortgages to landlords are approved, claim experts. Do not let this happen – sign the petition linked below.

The new rules will stop landlords buying new property to rent and restrict mortgage lending that will shrink the number of buyers and push house prices down.

This could put landlords and homeowners in to negative equity that would make selling homes impossible.

This bleak picture of the UK housing market of the future could become a reality as soon as 2013 if European MPs vote in favour of draft mortgage regulations that are aimed at pulling the UK market in line with the rest of the EU.

But British lenders say that buy to let should stay outside the directive because the lending is for business investment rather than for personal homes.

If buy to let is included in the new rules, lenders will have to underwrite mortgages on affordability rather than projected rental income.

For landlords this means they would have to show lenders they could afford to pay their buy to let mortgages from the rest of their income.

The Building Societies Association has slammed the move, with Paul Broadhead, head of mortgage policy, saying: “If the EU goes down this route lenders could be forced to change the way they underwrite buy-to-let mortgages. In the worst case, people wouldn’t have enough money to finance their buy-to-let mortgages and the sector could potentially stop overnight.

“Three quarters of these buy-to-let landlords are individuals, couples and families and if they cannot remortgage their properties they will have to sell, creating an influx of property on to the market and potentially reducing prices.”

The EU draft directive is set to be voted on by MEPs early next year.

Ed Mead, of the Association of Residential Letting Agents, said: “Potential EU legislation might drive many buy to let landlords away from what is a vital part of UK housing provision.

“This must be viewed with caution. Our government ought to be wary of taking a lead from the EU here and encourage informed investment into this sector with tax breaks, not lumping buy-to-let in with those residential purchasers who need all the protection they can get.

DO NOT LET THIS HAPPENsign this government petition and use the share buttons below to encourage others to sign it too.


Mark Alexander
Mark and his family have been investing in property since 1989, initially in the Norwich area but more recently across the length and breadth of England. Mark created Property118.com as a social network for landlords with a vision of becoming the UK’s largest online property investor directory.
Mark’s experiences and strategies as a landlord are shared here

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Comments

by Mary Latham

14:31 PM, 26th November 2011, About 10 years ago

Chris this is a perfect example of how tenants can control the market - as all customers do in any business - I agree with you a landlord who is not doing a good job needs to stop being a landlord and the best people to make that happen are the tenants.

Did you know that the landlord who was featured in a TV programme earlier this year went out of business when his lender pulled all his loans following the airing of that programme. I believe that the lender behaved very responsibily and not enough publicity was given to them for the action that they took.

I want to live in a world where people have genuine choice of where they live and whether they rent or buy and that choice is not available at the moment because there is a shortage of properties. Building more property is the key to customer choice and private landlords are part of customer choice.

by

14:35 PM, 26th November 2011, About 10 years ago

I am all for property as an investment but, like all investments, they need to be intelligently made and the desire to make a profit has to be balanced against an overall risk to the economy. In the last 15 years, much of the BtL lending could more honestly described as sub-prime.

Giving private individuals 'interest only' mortgages at 100% or greater than the value of the property, secured only against the property in question, was really stupid. But it was based on two fallacies a) that property prices would always rise and b) that bad debts could be made to disappear by diluting them with good debts and selling them on.

The problem was compounded by everyone who owned a property suddenly believing they were an instant expert because prices kept rising however dumb their investments were. Whatever your views on the EU are (I can see both sides) we need to set up the system so the reckless idiots who lend money are not able to lend it to reckless idiots who want to borrow it.

A lot of the people most dear to me are now in their early twenties and want to buy a property. We (all of us) have screwed it up really badly for them. We need to put it right.

by Mark Alexander

17:13 PM, 26th November 2011, About 10 years ago

I am all for putting things right but I'm not going to stand by and allow this legislation to pass. There is no need to commit commercial suicide. There are several reasons why people in their 20's are not buying houses other than affordability. Insecurity in interest rates is one good example. American homeowners can get 3.5% fixed interest rate mortgages over 30 years with no early repayment penalties. If we had those here there would be a lot more confidence. Job security is another issues. Causing a housing crash isn't going to help that, it would make the situation worse as the construction industry would be crippled and that would create a ripple effect in unemployment and the prosperity of our country as it has since 2009. I believe that people should have choices, whether that's to buy or rent a quality property. I am looking forward to the day it becomes viable for developers to build and sell for profit again we will see mothballed building sites finished and lived in, a better economy with more people in work and some stability in property values. A lot of things have to change for this to happen but a house price crash isn't one of them.

by

18:55 PM, 26th November 2011, About 10 years ago

I only have 3 btl's in gloucestershire, plus my own house and can cover the mortgage easily as I started in 1995. I have ensured that I can afford the mortgage by working harder and building up a larger cash reserve than many others as I don't want the stress of interest rises or other financial pressures. I think that risk buy to lets where individuals mortgage themselves up to the hilt hoping on a fast return is foolhardy. I have never wanted to envisge kicking a tenant out of a property because I am forced to sell it through my greed to captalise.
Banks are a lothesome but necessary animal and refused me extra credit years ago even though I was putting down 70% of the property price. I have always hated them just like another parasite - pension companies who still take their cuts and charges and give lame excuses even in the good years - thats why I switched to btl's.
It is hard to believe that France would agree to the EU proposals as over 65% of property is rented and most french appear not to want to be involved in property ownership so don't panic.
Just stay within your means and build up that extra reserve,-which will help you to jump to the next property.
As for government legislation, at present there is more rights for the tenant and we have seen more extra red tape which equals costs to landlords which only increases the wanting to get out of the BTL market.
Stay within your means and build a cash reserve for bad days we no are comming.
Stay within your means and

by

19:03 PM, 26th November 2011, About 10 years ago

BTL is for people who like assets they can understand, on a bad day even go and see them. Investing in the pensions industry is an alternative, but you can't touch your invstment and you never know if you've invested in a 'Bernie Madoff'. We need mortgages to get off the starting block. Our advice to new BTL investors? Beware of lease hold property, having been burnt twice we won't touch them!

by

20:03 PM, 26th November 2011, About 10 years ago

what a numpty! interest rates, if low, benefit all kinds of borrowers,( even numpties) and of course work adversely against any who depend upon interest ratesfor their livelihood. conversely when interes rates start to climb and benefit people with cash investments, it will adversely affect all borrowers, (including numpties who have mortgages and also have to rent elsewhere)
You seem to be saying that if there were no houses to rent you would still be able to do this far away job, presumably by living in a hotel, or your car, or even a cardboard box..instead of snarling at the people who provide you with the cheaper option (or the more comfortable option if you consider living in a car or box), just be grateful that somebody managed to scrape together the means to provide you with your far flung affordable accommodation. snarl instead at your employers for forcing you to work away from home, or the government for not providing superfast roads so that you could commute from home and deprive your hated parasitic landlord of his usurous rent.
whatever you do please treat his property with the same respect you do your own, pay your rent on time and keep the noise down out of respect for your neighbours.
that way you would stop being a numpty and join the ranks of the rational reasonable part of society that makes this country a nice place to live. cheers

by

6:21 AM, 27th November 2011, About 10 years ago

I think it's about time the country started to view the purchase of a house as somewhere to live rather than something to profit from. It angers me how young families with good incomes have been forced out of the first time buyers market by ridiculous property prices. There's no way I'll be signing this petition.

by

11:43 AM, 27th November 2011, About 10 years ago

As a buy to let investor Im appalled at the way this goverment is leading the country.

by

11:50 AM, 27th November 2011, About 10 years ago

as a buy to let investor for the reason of most of my Pension 5 years ago was not enough to live on,so I bought a house to let out,now it seems if the Goverment puts into place the new laws on giving 90%mortgages again to new time buyers,I feel as if my pension is being taken away from me yet again.

by Mary Latham

12:51 PM, 27th November 2011, About 10 years ago

Maureen if you are concerned that there will be a shortage of tenants don't be. The perception that most tenants are being held back from buying is simply untrue, all of my tenants are choosing to rent rather than buy. Those who are young couples are either enjoying the financial freedom of not worrying about furniture, repairs and interest rate rises or they are planning to travel before they settle down. I also have young professional tenants who are choosing to rent to give them freedom of mobility because of the work that they do. In my many years of experience good standard well managed property will let so long as it is in an area where tenants want to live- regardless of mortage availablity and interest rates. My pension is also in property and I know that I have done the right thing because almost 40 years as a landlord has taught me that property is overall the best investment and I have never dropped my rents at any time over those years


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