Is the King & Queen of buy-to-let in trouble?

According to the latest reports in the Mail poor old Fergus the king of buy-to-let is having a torrid time down in Kent with his 700+ property portfolio.

The Mail also seems to suggest that Fergus is mistreating his tenants and has dubbed him the 'Van Hoogstraten' of Kent after the infamous landlord.

They also imply that he is in trouble with his lenders but then reading on he has also swapped his fixed rate buy-to-let mortgage with a very attractive variable rate. Surely he must be creaming in rental profits even if half of his properties are empty?

Is this a case of the papers appointing a King only then to try to knock'em down again?

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Another BTL Property Fire Sale from Galliard

I've just received an email regarding another of these supposed 'Galliard fire sales'

This one is focused on the 22 storey development 'Vision 20' in Ilford

I quote Galliard "This will be a stock liquidation sale and prices have been reduced by up to a massive £135,000 making the opportunity to buy at 'Vision 20' one not to be missed."

This follows the January sale of Galliards Dockland development.

It begs the question, 'when is a sale a real sale?' Which is a question I have pondered before.

I was in Homebase at the weekend looking at some kitchen cupboards for a refurbishment. There was a Sale on and so I asked the sales guy to explain it. He informed me that there was always a sale on, they just restructure the nature of the sale reductions every few weeks.

So I sought clarification "This unit that is listed at £1000, is 50 percent off with a further 30 percent off that, which makes it £350"

"That's right." he replied."But there is always a similar deal on"

The fact is the unit was never worth £1000 in the first place, which begs the question is it even a sale? I'll let you make your own conclusions on that.

Which is why I will be getting the units from Ikea, the pricing is realistic and transparent, and their sales are real.

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Haven't got a clue....then consult

You know what they say in government.

Haven't got a clue or don't want to make a decision then consult.

This is the governments latest tactic when it comes to the private rental sector.

In announcing the latest consultation exercise the government minister, commenting on the publication of the consultation document, the Exchequer Secretary to the Treasury, Sarah McCarthy-Fry said:

"The consultation we are launching today will ensure that we fully understand the contribution the PRS can make, and identify any substantive barriers to investment.”

So if they by their own admittance don't know whats going on why are they hitting landlords with a barrage of legislation.

I've decided to consult on this one so any views please feel free to post.


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Foxtons bottle it.....letting agent renewal fees.

The news last week that Foxtons has decided to abandon it's high court challenge against the previous ruling on the charging of tenancy renewal fees may seem surprising.

However, in many ways it is not.....

The original decision last Summer gave many landlords an unrealistic expectation that it was only a matter of time before they would be able to claim back thousands of pounds in letting agents fees. However, this ideas may well be misfounded.

If we go back to the original decision by Mr Justice Mann the decision on the case related purely to the way the terms and conditions in the Foxtons agreement were worded and as to whether they were unfair when managed against the Unfair Terms in Consumer Contracts Regulations 1999 (UTCCRs). He ruled they were describing them as a 'trap' or 'timebomb'.

Foxtons appears to have done the sensible thing. They have reworded their contracts so that the clauses relating to renewal fees is no longer buried obscurely in the contract and the OFT and courts have accepted these. In a press release on Wednesday Foxtons indicated that they had a set of new terms of business with new terms and a renewal commission at a lower rate than the initial commission and do not seek to charge that renewal charge for more than two years.

It seems that no letting agent wants to confront full on the legality of the 'renewal fees' issue for fear of potentially loosing them and then also having to pay back all the previous letting agency renewal fees.

It looks like letting agents will have to be pushed into a test case to establish this. Any well healed landlords volunteering?

For more info have a look at this Citywire story.

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Lenders urge government not to regulate buy-to-let mortgages

Buy-to-let lenders represented by the Council of Mortgage Lenders (CML) have urged the Treasury NOT to regulate buy-to-let mortgages according to latest reports in the FT.

The CML has argued that buy-to-let loans mortgages are commercial transactions between commercially aware individuals and therefore should not require the same level of control that affects residential borrowers.

Property Hawk would support this view. Obtaining a buy-to-let mortgage itself is a commercial decision and those landlords deciding to use buy-to-let finance will have sufficient understanding of how they work and the risks involved.


Buy-to-let loans are not the real danger

What is more potentially dangerous is the intermediate companies, such as Imagine Homes. The failed buy-to-let investment business set up by Grant Bovey. This business and many like it have peddled and packaged a myth of residential investment as a one way investment bet. it is these businesses which packaged the investment product in a way that new investors were deluded into thinking that being a landlord was just like investing in a saving account that should be regulated.

Regulating buy-to-let mortgages would just penalise often experienced landlords that are more than aware that investing in property is NOT a one way ticket. The very fact that these investors are obtaining a loan individually and are not paying middle men stupid fees demonstrates that they have their commercial head screwed on properly and therefore do not need to be subject to further controls and restrictions in buy-to-let lending.

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RBS enable investors to bet on property price falls

For those landlords and property investors who want to see property prices as a two way bet, the Royal Bank of Scotland is looking to launch a product that will allow investors to bet on house price falls.

There's confidence from a state owned bank.

Read more on this interesting new two way bet

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