Should I sell or risk tenants buying at undervalue price?

Should I sell or risk tenants buying at undervalue price?

9:08 AM, 25th September 2019, About 3 years ago 48

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Should I sell? What Solutions are there for this Dilemma? I Realise that Nothing has happened YET! But I just want to be clear about what my options are.

Who thought George Osborne would have removed Mortgage Interest Relief! / Removal of Section 21! + ALL the other Rules and Regulations they are Hitting us with.

I have Good Tenants who have been with me for 10 years and I would not sell, but for this dilemma. John McDonnell wants to “tackle the burgeoning buy-to-let market”. He suggested to the Financial Times that they could pay less than market value, …. meaning that the profit we would have made by it increasing in value over the years could be wiped out by an undervalue sale price!

Joey

 



Comments

Dennis Leverett

16:00 PM, 26th September 2019, About 3 years ago

Reply to the comment left by Joe Armstrong at 26/09/2019 - 15:32
I've seen it on the council estate I was brought up on. Several that purchased their council houses and remortgaged to buy nice cars, luxury holidays etc. ran into debt, lost the house , evicted then rehoused in a council house some on the same estate. Absolutely ridiculous. My first marital home was a nice 3 bedroom brand new council house which I could have purchased later but didn't because I thought it was wrong and still do. When will decisions be made that have nothing to do with votes??? I can't see Labour actually doing it mainly for legal reasons but also they would be shooting themselves in the foot as most at the top end have various properties on the quiet and has has been shown often purchased as an expense, flipped, rented etc. and most got away with it.

Beaver

18:09 PM, 26th September 2019, About 3 years ago

Reply to the comment left by The Forever Tenant at 26/09/2019 - 15:56A friend of mine who is considerably richer than me had a house with a mortgage about 20 years ago. He wanted to buy a ferrari and he and his father did it together by taking out a mortgage. The reason he was able to do it was because at least then, Ferraris do not depreciate. At least that was the situation then but I don't know how much longer you'd be able to drive your Ferrari in any big UK city.
Some years ago I first started thinking "...dunno about this lot" when Menzies Campbell, then leader of the liberal democrats was talking on television about how to raise more taxes and said, "...we can't raise it from income, we have to tax assets."
The thing with parties like the labour party who are chronically prone to overspending, and not caring about it because they believe in public ownership, is that they go out and attack assets. Like Jeremy Corbyn's attack on the pharmaceutical industry for example. And because they attack assets people and companies that own them just move them. You can move intellectual property, you can move the jobs that depend upon IP, you can move cars, plant and machinery.
The only assets you can't move are land and property. The greatest value is in residential property. So in the end, parties like the labour party always end up attacking property with more taxes, because they have to; every other asset that can be moved gets moved out of the way. So rental property gets attacked first, owner occupiers get attacked next. Investment moves abroad, jobs move abroad, assets move abroad. And of course it's still all the fault of rich people.
So I doubt that anybody on this thread believes that a labour government would be good for property owners. And the only question remains whether the liberal democrats would be any better.

Dylan Morris

7:55 AM, 27th September 2019, About 3 years ago

The possibility of a Labour/LibDem/SNP coalition is very real IMO. The Tory vote will be split by the Brexit Party as I simply cannot see Boris doing a deal with Farage. Remainers even if Tory voters may well swing over to the Lib Dem’s as they won’t want to risk a No Deal PM in Number 10.
The danger is the Lib Dem’s have also strongly muted the RTB private sector initiative so both they and Labour have it in their sights. Any such action will kill the PRS and it would certainly kill me off as most of my properties I purchased back in 1997 and have increased massively in value. It would certainly be challenged in the Courts though.
However in reality I don’t think it will happen it would shock the rest of the World that property is being expropriated in the U.K. and the outrage would be huge leading to undemocratic measures being taken (.....I won’t elaborate).
I certainly think though a Labour coalition would look at removing the 20% Tax Credit “perk” on mortgage interest relief. Corbyn has already said he’d look at that. That is a strong possibility IMO. Again would be a disaster for highly geared landlords. But more palatable as Labour would argue the case for it easier than RTB and it’s so easy to implement.
Let’s just hope for a Tory government next time (simply the lesser of two, three or four scenarios) whatever side of the Brexit fence you’re on.

Rob Crawford

12:35 PM, 27th September 2019, About 3 years ago

Lets not forget that when the Conservatives came into power, their manifesto did not mention the adoption of Section 24. The idea was stolen from the Green and Labour parties after election. Voting for the Conservatives again does not mean they won't adopt a rent-to-buy scheme or other Labour policies at a later date! My concern is that the idea of rent-to-buy is gathering momentum - dangerous to say the least!

Marc

13:52 PM, 27th September 2019, About 3 years ago

They'll only have 4 working days a week in which to destroy capitalism and most of those will be spent cycling to climate change demonstrations in any case. I wonder what happens to mortgage companies' ERCs and whether they will also be forced to play ball with these insane ideas. Command and Control economies. One step closer to the Gulag. They should read their history.

Beaver

14:24 PM, 27th September 2019, About 3 years ago

Reply to the comment left by Rob Crawford at 27/09/2019 - 12:35
Whilst there is no guarantee that the conservative party won't do something to attack landlords I think it's much less likely because so many middle income earners have a small rental portfolio. SNP would probably be up for it because property values in Scotland are much lower and not as many of their voters would be affected. We know that labour will attack property if they can but it's also worth remembering that the Brexit party will split the labour vote.

The big questionmark is the not-so-democratic anymore and not very liberal liberal democrats. Are their policies good or bad for landlords?

The Forever Tenant

15:11 PM, 27th September 2019, About 3 years ago

Reply to the comment left by JJ at 27/09/2019 - 14:24
I would expect the Liberal Democrats to follow whatever party assists them getting into power, based on their previous track record.

I foresee the biggest issue will be convincing any tenant that providing benefits to a landlord will ultimately be of benefit to them. The most obvious benefit would be a reduction of rent, but unless the vast majority of landlords actively did this, it would go unnoticed. There may indeed be 2 million landlords, but there are considerable more tenants and that is who the political parties will be aiming for. As much as we hate to think it's the case, its all about the numbers.

Beaver

15:18 PM, 27th September 2019, About 3 years ago

Reply to the comment left by The Forever Tenant at 27/09/2019 - 15:11
I know it's a bit optimistic but it would be nice to think that a party would have the wit to do something that favours GOOD tenants and GOOD landlords.

martinB

8:11 AM, 28th September 2019, About 3 years ago

If I was in power I would offer landlords the opportunity to sell their property to their tenants or !st time buyers and in return their CGT bill is halved/reduced/removed.

Jessie Jones View Profile

9:39 AM, 28th September 2019, About 3 years ago

The true value of a property is simply measured by what someone else will pay for it at open market. A higher rental income will give any property a higher market value.
So the lesson here will be for landlords to increase the rent almost to the point where it cannot be let, but not quite. Maximising rental income will maximise value at sale.
And of course, the higher the rent, the more slowly that a tenant is going to be able to save their deposit.
So the consequences of such a Labour policy will be to increase rent to tenants. Another own goal by the Labour Party.

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