daveb4
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Post by daveb4 on Jul 30, 2017 12:54:27 GMT
I still believe review will stop 'outrageous' doubling. This they can just tell builders to pay compensation and/or change leases, stopping it completely just appears too complicated and costly. I do not think there are too many of the doubles as a percentage. I will put a smaller than average amount in though just in case I am wrong! Also it is only 6 months, hopefully we can get out at that time if renewed? Fun of P2P?
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stub8535
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personal opinions only. Not qualified to advise on investment products.
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Post by stub8535 on Jul 30, 2017 13:23:09 GMT
Does the issue not extend further than then ground rent doubling? The super sensational unbiased press also talk about unreasonable charges being applied to even assess the works an owner wishes to carry out. Surveyors fees, architect fees, solicitors fees for something really simple are often charged. They do not come cheap normally but with tax and the tea brewers commision plus other sundries added it becomes exhorbitant and prohibitive. Seems, from the articles, that contacting the current owners of the leasehold is very frustrating given the frequency they seem to be psssed through onshore and offshore companies. This point, also sensationalised by the reporters, requires legislation to control as it avoids tax revenues that are due, at best. Reasonable solutions are needed to these issues as well.
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Post by dan1 on Jul 30, 2017 15:37:28 GMT
Does the issue not extend further than then ground rent doubling? The super sensational unbiased press also talk about unreasonable charges being applied to even assess the works an owner wishes to carry out. Surveyors fees, architect fees, solicitors fees for something really simple are often charged. They do not come cheap normally but with tax and the tea brewers commision plus other sundries added it becomes exhorbitant and prohibitive. Seems, from the articles, that contacting the current owners of the leasehold is very frustrating given the frequency they seem to be psssed through onshore and offshore companies. This point, also sensationalised by the reporters, requires legislation to control as it avoids tax revenues that are due, at best. Reasonable solutions are needed to these issues as well. I recently had recourse to a surveyor. In the process of requesting quotes I received one which included their fee plus disbursements, in which "Disbursements should be limited to fuel from xxxx". It happens that xxxx was less than a mile from property to be surveyed - on yer bike was my response!
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romy
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Post by romy on Jul 30, 2017 18:05:24 GMT
My understanding is that :- "The borrower has already Exchanged contracts with a prospective purchaser who have paid a deposit with a long completion" so borrower and presumably moneything know exactly what someone is prepared to pay currently ! It would be interesting to know how long the "long completion" is MoneyThingIf contracts are already exchanged then surely that limits our exposure to any changes in legislation ( though accept that current public discussions may make people wary of the whole area)
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jlend
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Post by jlend on Jul 30, 2017 18:25:31 GMT
I think this is a bit of a beauty. I'm up to my neck in the MT Boll' loan so I won't be adding to my pot on that one but this ground rent loan to a brand new MT borrower is an excellent opportunity for real diversification and of course the all-important 12%. Ground rents have always been a fantastic investment and as safe as a rock hence the typical yield is only about 2%. If some investors are concerned that the so called government has decided to hold a rushed review of new build houses being sold on a long leasehold basis then fear not because any changes that could result will not be retrospective. Besides it is a bit of a bonkers review because I am personally at present dealing with a house builder who is building a number of houses and has himself only got a long leasehold interest because the local authority he purchased the land from wished to themselves retain the freehold interest - so it would be an impossibility for my friend to sell his houses on anything but a long leasehold basis because you cannot sell a bigger interest then you own. In addition valuation will always take into account the tenure and terms and conditions of any lease in place. In any event it is not relevant to this exceptional new loan on MT and I will be waiting with fingers poised from 12 midday tomorrow. And with the 12% AE loans repaying tomorrow, what an ideal day for two big 12% launches. These things don't happen by chance and what it shows me is that Ed and the Things work like well oiled machines and they are determined to give you immediate first class opportunities to re invest your money. This sort of dovetailing genius does not happen by chance. The only thing I would say is that other countries, including Scotland have in the past introduced retrospective legislation regarding leaseholds, not that we know what will happen in England/Wales as a result of the news/review
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GeorgeT
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Post by GeorgeT on Jul 30, 2017 20:02:45 GMT
I just don't see how you could retrospectively change something like this - it would create a bit of an uproar from all those people who would be adversely affected and when you bear in mind we have a minority government that can't really risk upsetting anybody it would seem to me to be highly improbable.
I agree that thé type of rent review clause whereby the ground rent doubles at each review is completely unreasonable but then I would expect competent solicitors to get such a provision struck out if it was on a new build new lease which could therefore be negotiated.
There has always been a big market in buying up ground leases at auction because they are very good investments and for a government to come along and try to undo existing contracts would seem to me to be a non starter.
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jlend
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Post by jlend on Jul 31, 2017 6:51:22 GMT
I just don't see how you could retrospectively change something like this - it would create a bit of an uproar from all those people who would be adversely affected and when you bear in mind we have a minority government that can't really risk upsetting anybody it would seem to me to be highly improbable. I agree that thé type of rent review clause whereby the ground rent doubles at each review is completely unreasonable but then I would expect competent solicitors to get such a provision struck out if it was on a new build new lease which could therefore be negotiated. There has always been a big market in buying up ground leases at auction because they are very good investments and for a government to come along and try to undo existing contracts would seem to me to be a non starter. Interesting. I think it's more likely now the conservatives only have a minority as it would not take many to side with Labour in an ammendment to anything that is proposed. This has already happened once in a completely different area that my partner is working on. Even the link to RPI may cause some people serious harship. Wage growth has been running below even CPI and this looks like it may continue. Both my brothers are feeling the effects of inflation and I have been helping out one of them. The compound effect of a year on year rpi increase may be challenging for a large group of people. I have rpi linked corporate bonds that are trading up over 20% so the market thinks there is more inflation to come. I should say I am currently buying the freehold of my existing house which has a long 900 year lease. Although in my case the ground rent has no escalation clause so has never increased since it was built which clearly is not typical for more recent houses.
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seeingred
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Post by seeingred on Jul 31, 2017 8:52:09 GMT
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Post by SophieThing on Jul 31, 2017 9:54:04 GMT
Hi All,
The start date of this loan has been delayed by 1 day and will now go live on Tuesday 1st August at 12pm. This is due to the fact that there was an error in the loan particulars published which has now been corrected. We wanted to give extra time to lenders to review the current and accurate information.
The loan particulars stated that "The borrower has already exchanged contracts with a prospective purchaser who have paid a deposit with a long completion (MoneyThing's solicitors have seen these Exchange contracts)." This is out of date information. The prospective purchaser is not proceeding with the purchase. The borrower is however confident that they can find an alternative purchaser within the 6-month loan term and they are already in discussions with another potential purchaser.
The MoneyThing Credit Committee was fully aware of the situation and approved the loan on on this basis. It was simply an internal error that led to the out of date information being added to the loan particulars. We apologise for any inconvenience caused.
Kind regards
Sophie
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Post by settersam on Jul 31, 2017 9:56:20 GMT
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elliotn
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Post by elliotn on Jul 31, 2017 9:56:57 GMT
Hi All, The start date of this loan has been delayed by 1 day and will now go live on Tuesday 1st August at 12pm. This is due to the fact that there was an error in the loan particulars published which has now been corrected. We wanted to give extra time to lenders to review the current and accurate information. The loan particulars stated that "The borrower has already exchanged contracts with a prospective purchaser who have paid a deposit with a long completion (MoneyThing's solicitors have seen these Exchange contracts)." This is out of date information. The prospective purchaser is not proceeding with the purchase. The borrower is however confident that they can find an alternative purchaser within the 6-month loan term and they are already in discussions with another potential purchaser. The MoneyThing Credit Committee was fully aware of the situation and approved the loan on on this basis. It was simply an internal error that led to the out of date information being added to the loan particulars. We apologise for any inconvenience caused. Kind regards Sophie MoneyThing, could we use the extra time to upload the valuer's opining as the VR is also out of date - what is the expected yield with the 'doublers' stripped out, thanks.
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registerme
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Post by registerme on Jul 31, 2017 10:05:03 GMT
And how might this impact the chances of refinance / sale?
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m2btj
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Post by m2btj on Jul 31, 2017 10:06:28 GMT
It appears to have fallen off a cliff! Maybe James Tuttiett could follow it!
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Post by GSV3MIaC on Jul 31, 2017 12:12:30 GMT
Down about 10% .. I'd call that 'stepping off the kerb' rather than falling off a cliff. 8>.
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oldgrumpy
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Post by oldgrumpy on Jul 31, 2017 12:28:55 GMT
Yes. A typical deliberately misleading "illustration" to support a sensationalist headline, showing a graph where the price (apparently) drops almost 100% to "the bottom" ... but doesn't actually show the bottom three quarters of the graph down to zero on the vertical axis. We were warned about this practice in the 1950s in year one maths classes at the grammar school.
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