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Firstly, landlords are not after making a fast buck. 78% of landlords see the main motivation for building their property portfolio is to provide for their pension.
Despite the stories of spiralling rental costs their figures reveal:
- the average rental for a 2 bed flat in London (zone 1-2) has gone up by just £5 over the last year
- the average rent increase is 4.2% over the last 12 months - our own Rentindex shows rents have fallen by 1.7%
- only 74% of gross rental income remains after a landlord paying management & maintenance costs
- 2 years 6 months is the average tenancy (pouring scorn over the idea that landlords are constantly booting tenant out because they can then jack up the rent)
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I have two BTL properties on the South Coast, from which I've make a small profit since interest rates have been low. Before that, it cost me more to let & maintain the properties and pay the interest than the rental income. When rates go back up, I am unlikely to do more than break even.
Like many BTL landlords, I am betting on house prices rising sufficiently over the longer term to allow me a small income in my retirement. I have no pension, and thanks to the way that all parties have lurched towards the right-wing, it's pretty obvious that the state is withdrawing from any responsibility for looking after people in their old age.
This is a very risky strategy, and I live with the constant worry that a housing crash and hike in interest rates could leave me bankrupt with negative equity. If that happens, I will lose everything I have worked for all my life.
If my strategy is successful, I might just about be able to afford to retire one day.
Whilst being a landlord is relatively easy, it can also be stressful and there is always something to do. OK if you are a professional landlord, but most of us are not and have to fit in all work to be done on our properties around full-time jobs.
Of course, the millionaire politicians that populate all parties couldn't possibly understand this. They live in a world so far removed from reality that they have no idea what life is like for ordinary people.
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