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10:13 AM, 30th November 2011, About 13 years ago 21
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Landlord’s Log, the Personal Blog Of Mark Alexander, the Founder of Property118
** I was so shocked when I received this commentary last weekend that it has taken me until now to decide to post it. The following was sent to me as an email by a person who prefers to remain anonymous for obvious reasons. The commenter has not responded to my numerous emails. Is this a joke? I have decided to share it with you because; frankly I was flabbergasted and wanted to see what you have to say. I’ve decided to give this poster a name and a picture and in a strange sort of way I hope he will be back to entertain us all again with his responses to your comments. The name I’ve given to him (at least I think it’s a him) is “The Banker”. The following is what he had to say …
The Banker
I knew that title would catch your attention.
One mans misfortune is another mans opportunity, mine!
You and your highly leveraged buy to let pals are all like lemmings heading towards a cliff, oblivious of your fate.
Well here I am, to warn you of your fate.
I’m not the only one hoping that the next boom will in fact be an implosion in terms property values, you call it a property crash, it will be the making of the likes of me. The chaps on that House Price Crash forum are doing me a big favour by talking up the next crash.
Bring on the great house price crash of 2012 I say!
It’s those of you with highly leveraged buy to lets that made the HPC mob so angry and they want to see you crash and burn. I hope their wishes come true, it will be bloody marvellous for me, crap for the economy, but what do I care? The HPC mob all think it will be their armageddon, fooled into the belief their kids will be able to get on the property ladder. They have a shock coming too. They’ll have a hard job unless they have a Dad like me or my drinking buddies because the lenders will have shut up shop and interest rates will rocket to keep the banks afloat. You watch the FSA allow the banks to change all your mortgage terms, mark my words. You all think you are safe on your Mortgage Express base plus 1.75% deals don’t you? How safe will you feel when they are allowed to increase your margins to base + 4%?
I made a fair wedge off inverse ETF trading off the back of my last banking bonus which was well earned given the cr@p I have to deal with.
I’m sat with about £20 mill cash and so are lot’s of my buddies at my local wine bar.
Whilst all you buy to let mugs are selling up for whatever price you can get we’ll be snapping up all those so called BMV’s off your trustees in bankruptcy for 50% or less of what you paid for them.
We might even decide to rent one of the smaller units back to you if you can find a home owning guarantor who can pass a credit test. You won’t pass a credit check, obviously!
Have no doubt, you will need to rent because you’ll all lose your homes and need somewhere to live, just like everybody else who leveraged their properties over the last 10 years. If you don’t pay what, I’m sure you’ll bleat on about being the extortionate rents, I’ll be charging then I’ll take your guarantors properties too. Fancy a game of monopoly with me?
Best of all, I’ll be one of the elite few in a position to buy. I’m reckoning on 20% returns based on the prices I expect to pay and the demand for my properties. The rest of you can just take up squatting in a boarded up house, which I believe is now illegal in the UK, or take your choice between a tent, a caravan or living on the streets 🙂
If you think these affordable housing schemes will bail you out, forget it. The country will be in such a mess they will never be built and neither will any new homes because the builders will either go bust or won’t build because it won’t make financial sense for them.
I’m also looking forward to those bloody foreigners b”ggering off back to their home countries, it will be better for them than staying here, that’s for sure.
Viva 2012, let the games begin 🙂
Sent from my iPhone
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Property118 Landlords Newsletter - Issue 76
17:43 PM, 30th November 2011, About 13 years ago
It would appear that this gloating protaganist is unaware ot the potential crisis coming to the residential rental idustry if the EU gets away with enforcing the regulation preventing BTL mortgages being obtained on rental income criteria.
Even if you have 20 million pounds that will only buy about 80 properties at £250000.00 each with no mortgage required.
This person would have to use all his cash to buy as he WILL NOT be able to obtain BTL mortgages as he will only have an income of about £190000.00 per year.
This would only be sufficient to buy about 5 properties including his residential property and his unsecured debts.
So he WILL NOT be able to gear up and therefore his 20 million will have little impact on the market.
8:28 AM, 1st December 2011, About 13 years ago
The 'banker' refers to the BTL mugs, it would appear he has a grudge for what ever reason against us. He refers to his buddies, he obviously has no friends. If he is as financially aware as he protrays, why does he not put himself forward to put the countrys dire financial problems straight and come out of his closet!
Mark Alexander - Founder of Property118
8:51 AM, 1st December 2011, About 13 years ago
I have to wonder how this person knows so much about our industry? Perhaps he's one of the failed "underground property guru's" with a chip on his shoulder now that he's gone bust because nobody wants to know about his "secret underground BMV master classes? I'll bet he doesn't even have 20 quid to his name, let alone 20 million! Does he really believe that that there will be a massive property crash for the reasons he's stated and that lenders, government, regulators, etc. will make such idiotic choices to allow this to happen? Not a chance! If he's so confident, perhaps he should invest whatever dosh he has got with his local bookie on his predictions? I reckon he'd get such good odds he might even make his 20 mill of the back of his 20 quid is he wins his bet LOL. Even if he did, his arrogance would still not be acceptable. Why did Property118 decide to post his email? If it was to wind us up, his intention I'm sure, it's worked on me! Maybe I should have a pint of what Tina has been drinking 🙂
Ian Ringrose
12:41 PM, 1st December 2011, About 13 years ago
What if you have a large LTV that is about to revert to the lenders “SVR” and you can’t re-mortgage to a better rate due to a small drop in the value of the property. (You re-mortgage to up the full “value” to get out your deposit to buy the next one)
What if your properties are in high yield areas that only people on housing benefits are willing to live in?
What if the housing benefit rules were change, so that it was capped at 70% of the average cost of a shared room in a HMO for everyone without children?
What if you had 30 properties with the above issues?
(Think of how this will change prices/rents at the bottom end of the market for all landlords, even if only 25% of large landlords get into problems and become forced sellers – are you cash positive over all sourced of income to come with a “meld down”)
He may just be right…
I see possible long term housing benefit rules changes as being the biggest long term risk to most of the “high yield” deals being done in the North.
3:04 AM, 2nd December 2011, About 13 years ago
I am STILL waiting for a reply from Grant Shapps as to whether this EU BTL regulation is going to be introduced to the UK.
You would have thought a simple yes or no would have been forthcoming; but no word yet!!
0:20 AM, 14th December 2011, About 12 years ago
Falling house prices also effect remortgaging. Diminishing equity raises mortgage costs, this is likely to be magnified by higher Libor rates in the coming months/years.
8:05 AM, 14th December 2011, About 12 years ago
How can anybody with any common sense give a thumbs down for the fundamental response required from the Housing minister as to whether BTL mortgages are to be prevented from being facilitated on rental income criteria.
These thumbs must be trolls as only and idiot landlord would thumb this comment down; showing a complete and utter lack of understanding of the industry he is in.
8:10 AM, 14th December 2011, About 12 years ago
Your point about housing benefit is so valid.
Have you hads a chance to look at what the UC amount for housing is going to be.
I read on some govt report that it will be £380.00 along with other lumped in benefits!!!
Your secenario of lower LHA looks even worse with UC.
What do you think?
11:49 AM, 15th December 2011, About 12 years ago
The 'baker' chooses to remain anonymous for the obvious reason we landlords will be laughing like drains at the arrogant,self satisfied prick in twelve months. Thankfully I live near a small town without a wine bar,so am unlikely to have the 'pleasure' of listening to the pontificating prat or his cronies.
John Curtis
16:22 PM, 15th December 2011, About 12 years ago
I watch this and other sites and get very confused with all the information available.
Firstly we have a growing population due to immigration, life expectancy growing, marriage break up and or more single households. With this demand the housing stock of the UK is under pressure in normal times(at least since the last war).
For the last 5 years housebuilders have been building the lowest number of units since records began.
Planning & inspection costs have risen, building standards have risen, environmental charges(section 106) have been introduced, in fact every part of building houses,flats etc. has increased.
Now the experts continue to tell us the cost of property will fall again. Please advise when the cost of existing property will be so low that new property will be affordable, considering most builders cannot at present sell their new properties for what they cost to build.