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

13:50 PM, 29th November 2011, About 10 years ago

If buy-to-let landlords are no longer able to provide comfortable and affordable accommodation for tenants due to this ridiculous proposed legislation because they are unable to get mortgages will the council be able to provide suitable accommodation for tenants? I think not - they have hardly any housing stock left.

I have been a buy- to- let landlord for a number of years and have not as yet made any profit so I fail to see how some people who have commented on here perceive landlords as parasites. There is nothing left to put in my pocket once the repairs, maintenance, insurance and safety checks are paid.

Sometimes I feel as if I am running a registered charity. I have always treated my tenants fairly but if only the same could be said for them.

Thankfully the majority are OK but many are out to cause hassle from day one either trashing the place or failing to pay rent.

Sadly there is a section of society that will always remain at the very bottom because they do not attempt to better themselves but merely rip off money from those they wrongly assume can afford to loose it. I have often had to borrow money to pay my mortgages because tenants have failed to pay the rent and it continues to be a daily struggle.

The landlord/tenant relationship should ideally be one whereby both gain something; i.e. the landlord gets his rent to pay the mortgage and the tenant has a suitable place to live because for whatever reason he chooses not to buy his own house. Neither party should lose because of being taken advantage of by the other.

Of course there are bad landlords and there are bad tenants just as there are with anyone else in society but in my general experience it is the tenants who are often the parasites - knowing they can get a free ride and get away with it. They milk the system for every penny they can get and with the housing allowance paid directly to them nowadays they can easily rip landlords off even more and get a free roof over their heads into the bargain when quite frankly some of them do not deserve a dog kennel.

I would like to see better legislation that protects both good landlords and good tenants from those who are bad rather than landlords be bombarded with silly and badly thought through legislation which is detrimental to those landlords like me who are providing a public service by supplying people with a decent place to live.

by Mark Alexander

12:17 PM, 30th November 2011, About 10 years ago

What are your thoughts on the following thread?

http://www.property118.com/index.php/the-property-boom-of-2012/21545/

I'm sure it must have been inspired by the EU debate here.

by Mary Latham

16:52 PM, 30th November 2011, About 10 years ago

It is great that over 10,000 people have read this post but it is not so great that there are only just over 2000 signitures on this important petition. In order for this to be debated in parliament there needs to be 100,000 signitures. If it is not debated it WILL go ahead.

The Enlish are known abroad as a nation of moaners who dont actually do anything other than moan, can we please show that this is wrong AND SIGN THE PETITION TO GIVE US A CHANCE OF STOPPING THE EU FROM KILLING BUY TO LET BORROWING

http://epetitions.direct.gov.uk/petitions/22767

Just click the link and follow the simple instructions it takes just a couple of minutes.

by Mark Alexander

17:01 PM, 30th November 2011, About 10 years ago

Well said Mary, we also need all Landlords to tell all other landlords they know. The "Sharing is Caring" buttons make this very easy to do. They are just below the main article.

by

11:11 AM, 5th December 2011, About 10 years ago

I WILL NOT SIGN THIS PETITION - THANK GO FOR THE EU AT LONG LAST

Here I am diligently saving for a deposit and already it seems futile because of all these blasted BTL's swallowing the entire market which means that even if a lender agrees I cannot find the property I want because every one is taken by these damned But-to-letters.

Why should I be kept out of the market?

Why should the housing market be a closed shop?

When looking for a rental flat recently in London every ad I answered turned out to be some snivelling, cynical, greedy little offshore property company, squirreling away rent to the Cayman Islands and dodging taxes. It is DISGUSTING.

Free the housing market now. With a housing crisis now firmly taking hold in the UK and the lowest level of home building for 80 years there should be an Act of Parliament banning anyone from owning more than ONE home for rental so people have the right to buy their homes.

Otherwise Britain will end up a nation of homelssness and renters, stripped of the financial security that a home provides. The EU is absolutely right for once and even if it is a pact with the Devil I would gladly throw away all my Euro scepticism in exchange for landlords being booted out.

People who support this article bemoaning the EU proposal are just plain greedy. They want house prices to rocket upwards so that THEY make cash, to hell with everyone else. They've learnt nothing from the asset bubble lessons of the financial crisis and want everything for themselves.

We cannot afford this kind of rank selfishness in society any longer.

by Mark Alexander

11:21 AM, 5th December 2011, About 10 years ago

Hi Nick

Thank you for sharing your opinion but I'm sorry to say, I do not follow your logic.

The offshore companies that you speak of do not require buy to let finance and even if they did, their chances of obtaining it are extremely minimal.

The other point I would like to make is that Germany are the strongest country in financial terms in the EU and yet they are a nation of renters. The Greeks, on the other hand, are a nation of home owners.

Please rationalise that.

by

22:56 PM, 5th December 2011, About 10 years ago

So will that mean that it will be difficult for newby investors to get into the private rental market?

That would kill a dead market (lol) and leave only existing landlords eligible to buy properties because they have a proven track record. The problem I see is that nobody wants to lend to us, the existing proven landlord, they want people with less than a handful of houses and a full time job with a good sallery. It would do more than kill the market............ its women and children to the slaughter, leaving men to reproduce and keep the existence of mankind alive.......... O'dear

by

8:36 AM, 7th December 2011, About 10 years ago

Well quite simply Mark you just didn't read my post properly, did you? When did I say BTL parasites needed funding? Ready for the answer?....
I DIDN'T.

The point I was making was that they gobble up all the properties so that none of the ones you want to buy are available and they never sell. That is what I am saying. The fact is there is no "Housing Market" any more and I wish people would stop using that phrase. If there are no apples to buy there is NO apple market. In order for a market to exist there have to be avilable products for sale.

I have not seen A SINGLE "FOR SALE" sign against a residential property since I came back from the US in 2009. Retail properties - yes. Residential ones NO.

And when I ran around London recently looking for a rental, ALL 20 odd properties I viewed were run by offshore property companies including dozens of Arab ones because we're the only country dumb enough to let them all in. They keep their properties in rotten condition, never repair anything, neglect their tenants and charge exorbitant rates.

Well done EU, that's all I can say.

As to the Germans renting, if I lived in a country that had its economic act together and looked after its elderly I wouldn't need the security of my own home. That's why they can rent. They know they'll always be employed and they know they will be very affluent come retirement and German elderly care I bet is the tops.

But I don't live in a country like that. I live in Rag Bag, Third Rate, Miserable Britain - overrun with immigration, chronically overcrowded, very badly managed by governemtns of both colours with militant unions hell bent on wrecking the whole nation if they can get rich off it. A little different, yuh? In that environemnt you need SECURITY. And in Britain there is only one place to get it - BUY A HOME...FAST. Germans don't - they have security naturally built into their colossal economy (and they run the EU anyway)

In Britain you buy a home to pay off the mortgage by the time you retire so that you are comfortable in your retirement.

Oh dear! - the offshore BTL's have taken them all. Well, then I guess I'll have to hunker in some crappy retirement home with abusive staff then.

Trust that answers both your points squarely.

by Mark Alexander

13:43 PM, 7th December 2011, About 10 years ago

Thanks for sharing your perspective Nick. The world would be a very boring place if we all shared identical opinions. It is opposing opinions that makes discussions like this so interesting. What does everybody else think about what Nick has said?

by Annie Stevens

0:02 AM, 8th December 2011, About 10 years ago

HI Nick,
As Mark pointed out, you do in fact refer to these offshore landlords as "buy to letters", with the expression "offshore BTLs" . He was also correct I'm sure in saying that they do not need Buy to Let mortgages from anyone to purchase their properties, they have plenty of cash available to deploy in the most tax efficient way that suits them at any given time. Buy to Let mortgages have on the contrary democaratised the process of becoming a landlord, enabling ordinary working citizens to buy and manage properties where it would have been simply inconceivable previously. Most private landlords are not significantly different from the people we rent to, in fact most of my tenants are better off than I am in terms of disposable income, lifestyle, and peace of mind, and that includes my benefits tenants. One of them has had two foreign holidays this year with her three children, a much bigger telly than me, and has gradually asked me to remove all my furniture while she replaced it all with brand new stuff. I meanwhile have had about four holidays in 35 years of full time work, and am sitting on a sofa which one of my other professional tenants decided to throw out when they moved into the showhouse furnished home of their dreams which I was able to provide for them. They still have their own home elsewhere which they in turn rent out, and have no desire to buy another one for the time being, as it would only tie them down. Most of my tenants are nice decent people who get on fine with me, they know where I live, and know that I will deal promptly with any problems, unlike these faceless, disinterested multi millionaires who will become the main type of landlord again if the BTL mortgage disappears. The few tenants who might try to characterise me as a bad landlord are the ones who think I shouldn't harrass or stress them out by having the nerve to enquire of them when the rent for the last three months might be forthcoming, while demanding instant repairs for self inflicted breakdowns of non essential items without a please or thank you, and then being too "busy" to make themselves available for the repair man, or too lazy to get out of bed when he turns up at the agreed time of 11.30 am. They are the ones who think all landlords are millionaires, and see themselves as our poor exploited victims.
Your experiences in the London property market are bound to be vastly different to most of the rest of the country. It may as well be another planet, and I pity anyone of normal working status who needs to get by there. However, out in the real world I see plenty of properties in all price bands for sale, but the cheaper ones often don't sell as quickly as the expensive ones. Not sure of the reason, but I think it is partly due to the large deposits required and partly due to the fact that even first time buyers these days aspire to start on the third rung of the housing ladder in a luxury riverside apartment or new build three bed detached, instead of a small affordable flat that they could do up to add value and wait a couple of years before moving on.
Owning a property outright by the time you retire does not necessarily give you security in old age. You could own the house but have not a penny in savings and only the basic pension, so you'd have to sell the product of your life's work in order to eat. If you have to go into care, you will have to pay for almost everything yourself which again means selling your house and your children's inheritance. Average care home costs are about £3000 per month, more than the take home pay of my husband and I put together working full time. If you have rented all your life and have no savings, you will be eligible for maximum support to get by. No wonder many people make the perfectly legitimate choice to rent with no ties and spend their money on having a life.
Incidentally, how do you know all those "20 odd "properties were owned by "dozens of Arabs", or did you just make that assumption because they were being managed by agents, therefore they must be? Letting agents up my way don't tend to give out that much information willy nilly. Just wondering.


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