Quest report BTL survey instructions down by 40% on February

If you really still can buy houses a cheap as 30k which yield 500 pet month.....I doubt very much that GO new policy will make much impact. You should let me know which area you operate in....I'll be straight up to snap some of those up in cash.....hell....even on my credit card...?

Hi that would be telling to be honest we advertise to get those types of deals and I'll be honest it's getting harder and harder to source them

Reply to the comment left by "NW Landlord" at "14/05/2016 - 12:01":

So why bother with mortgages? Just buy cash, hell I'll take 5 today if those figures are true.

If I recall you said you have a portfolio in the 100's? £30k should be a drop in the pond surely?

Yes
Mark Andrews
Go to jail as it is HMRC knocking on the door not the mortgage companies.
Look, here is what happening in some parts of country
Let's say a LL has £100k in rent each year.
Each year this LL pays £60k in mortgage payments.
There is a balance of £40k which is subject to tax at the lower rate of 20%
£40k then covers the cost of the Lettings " business"
Whatever is left is profit.
The Tenant tax assumes this LL is making £100K pa and therefore he/she is immediately a higher rate tax payer at 40%
and will pay accordingly.
It could well be that this "business" is now operating at zero profit or even minus profit but must still pay.
This just does not seem fair or reasonable.
Allowances for wear and tear are being scrapped too.
So a LL buys a property with a hefty deposit usually at least 25% plus costs.
Is not protected by the FCA as although they consider this a commercial non residential loan you can not claim back the commercial loan interest back.Curious don't you think?
You refurbish the property top to bottom adding value to your own property and the local area. You employ local people to carry out the work, some LLs are amazing and can do everything themselves and use local retailers for materials.
All furnishings are now in place and any tenant has the luxury of a "as new property" just about.
Great if you can build up your business only using cash but for most part building your letting " business" is about leverage.
Leverage helps the value of your business grow.
Example
You have £100k you buy one house
It is let for £550 per month ( not a brilliant return not too shabby either ! )
5.5% return give or take you get the point.
Or buy 3 houses with loans with your £100k keeping a little aside
Generate £1650 per month and possibly benefit from 2 things
1) an increase in value X 3
2) the face value of the loan going down with inflation over a period of time.
It's not that the loan amount = greed it's simply a matter of strategy.
Donald Trump works on leverage.
Is he a greedy billionaire or a pretty smart business man?

Back to first example, seems a bit unfair that the " business " of letting property cannot claim wear and tear but a barbers chair wearing out is claimable.
Most LLs charge a little less than market on most of the " business" properties because they want full occupancy all the time. That may well change. A better way in the future will be "I'm charging you maximum rent with no exceptions.
I don't care about your problems pay up or move on.
You can thank Gideon for this.
It's a Tenant Tax.
Some LLs choose areas where there is an opportunity of growth.
Other LLs like NW Landlord I suspect buy for max return in rent and aren't too bothered about growth.
What's your strategy?

You're an investor not a business. You take out interest only loans with absolutely no plan on how to repay the principal at the end of the term - other than through sale of the house (assuming house price growth) Owner occupiers are not allowed to do this.

If I speculate on equity on the stock markets with money taken out on a loan, I get no tax breaks on the interest in my loan. Why should property speculators be treated any differently? If you want to leverage up then fine, just don't expect tax breaks on it.

As for Donald Trump, lost count of how many times he's declared his companies bankrupt. And he's made a fortune out of corporate bankruptcies, think you can do the same?

You are a fool who is trying to cause an argument I have an office with staff and a business that I run full time to say investing in property is the same as equities shares etc is a joke buy to let is a business end of story. And for your information the plan at the end is to sell or refinance last response to your drivel

A speculator is a trader who approaches the financial markets with the intention to make a profit by buying low and selling high (or higher), not necessarily in that order. The speculator is distinguished from the investor, who approaches the financial markets with the intention of making a return on his capital.

How is allowing to deduct your mortgage payments to arrive at profit a tax break no business in the world is taxed this way they are taxing money that isn't there, in any world this is unworkable at best how can you tax debt ?? It's political and will unravel over the coming years and then be scrapped

Sell or refinance? Point proven. No real exit strategy at all. You're speculating on rising house prices, and if that fails, 'refinance' which basically means take on more debt to repay old debt....like a snake eating its own tail

Reply to the comment left by "Richard Mann" at "14/05/2016 - 18:53":

"A speculator is a trader who approaches the financial markets with the intention to make a profit by buying low and selling high" - if you're using interest only mortgages then that is exactly the same 'strategy' as you! If you can't see that, you're a fool.

You put you're capital into a house (25% deposit) and use leverage (debt) from the bank for the remaining 75%. You then only pay the monthly interest off on your loan, without paying any of the principal, in the hope the house price rises and you can 'sell higher'

Problem for you is, government has realised that when the asset you're laying claim to is a potential home for someone, it causes big problems for everyone who wants to own and live in their own home, but doesn't have access to the same amount of debt because the amount of debt they can take on is linked to earnings, not 125% (soon to be 145%) of the local rental rate.

Anyway, obviously we wont agree and refuse to see your situation for what it is, so lets just see how your 'business' plan goes. By what % will you need to raise your rents again to offset Section 24?