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Post by norfolkblue on Apr 27, 2015 13:10:11 GMT
There's understandably a lot of worry from investors (and sane people alike) about the prospect of a Labour + SNP government, but I'm starting to worry about a Labour majority (or strong minority) government as well with the recent announcements.
Milliband is obviously astute enough to realise that there are a lot of renters (especially in London, where there are many marginals) out there who will react well to anti-landlord policies, and won't have the economic understanding to see the flaws in their policies. I can live with this while it's just empty rhetoric, but I'm starting to be concerned that it might actually flow over into policy should they win.
The plan to cap rents will really hurt the BtL market, and I worry we'll have years of phased exists from Landlords who decide it's better to sell than to leave properties empty until a inflation safe rent can be achieved.
I'm mainly involved in straightforward business loans, but I'm exposed to a fair bit of property via AC and FC. Many don't rely on tenant income ,but could suffer lower capital gains if B2L investors leave the market.
At the moment I'm erring on the side of caution with anything to do with Property until the election is over.
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Investor
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Post by Investor on Apr 27, 2015 13:35:48 GMT
Think the administration on this would be too difficult for Labour to manage, bacon sandwiches are tough enough. Just ensure you increase the gross rent by 25% the week before the cap comes in, then ensure all your tenants get a 25% prompt payment settlement discount for paying their rent on time. Next year they get a 22% prompt payment settlement discount and on we go. No margin erosion and tenants seem to be very keen on ensuring they meet their contractual obligations.
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Post by Deleted on Apr 27, 2015 13:46:37 GMT
I would think Ed's lack of understanding how money is made should be the biggest fear. Radio 4 discussed the options on tennant rates this lunch time and the rep from the industry just said that his people would just put up the rate to cover 3 years for a 3 year deal.
I note that someone is suggesting hitting building sites with planning permission with their full rates charge after 3 years of ownership even if the building is not built yet. Should end up with pass the parcel :-)
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Post by bracknellboy on Apr 27, 2015 19:49:12 GMT
I would think Ed's lack of understanding how money is made should be the biggest fear. Unfortunately we seem to be in an era when this is not just symptom of labour but of all political parties: in the last 10-15 years we appear to have moved to the idea of a political cadre i.e. senior politicians who are no more or less than career politicians, far far more so than before. Ever noticed that when people say of a politiican "what do they actually believe in.." that is normally directed at someone for whom politics is and always has been their career. Politics is of course about compromise and the art of the possible, but if the gaining of power becomes and end in its own right then we end up with what we appear to have today. the likes of Ed, Dave, Nick George and the other Ed are not stupid people. Do we really think that Ed M thinks that putting caps on rent is not going to lead to anything other than a decline in properties avaialble for rent ? Controlled rent markets and additional tenancy protections have been proven to produce the converse effect of that supposedly required across the globe the world over. Stoking up housing demand with subsidies for first time buyers without addressing the fundamental issue of supply / demand (becuase one is politically easy and the other is politically toxic) is a recipe for achieving the opposite of what is needed to address the apparently identified problem. Do we think that the existing crop of politicians actually care ? .
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bugs4me
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Post by bugs4me on Apr 27, 2015 21:53:36 GMT
.Do we think that the existing crop of politicians actually care ? In a word Nope. I would have a lot more time for them if they had done a 'proper job' for say 20 years before becoming politicians.
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Post by batchoy on Apr 28, 2015 6:07:27 GMT
I have to say I am more worried about the fringe parties, and yes I do include the SNP in that group, who may end up wielding a disproportionate amount of power than I am by the mainstream parties, but that said I am always worried by the prospect of a Labour government who are anti-wealth and have clearly stated that their 50% tax rate is nothing to do with raising revenues but is there as symbol of their position.
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adrianc
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Post by adrianc on Apr 28, 2015 7:13:24 GMT
I would have a lot more time for them if they had done a 'proper job' for say 20 years before becoming politicians. Somebody like John Prescott, y'mean?
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Post by davee39 on Apr 28, 2015 7:48:24 GMT
Not worried, annoyed.
The promised cap on energy costs misfired and Milliband learned nothing.
However I am a taxpayer & I rather resent the transfer of wealth from the state to BTL Landlords via housing benefit, so I would have preferred a policy involving building more houses financed by BORROWING (a new 4 letter word).
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Post by easteregg on Apr 28, 2015 12:13:05 GMT
I have to say I am more worried about the fringe parties, and yes I do include the SNP in that group, who may end up wielding a disproportionate amount of power than I am by the mainstream parties, but that said I am always worried by the prospect of a Labour government who are anti-wealth and have clearly stated that their 50% tax rate is nothing to do with raising revenues but is there as symbol of their position. It is always dangerous to talk about politics as people can quite rightly take a quite different view, but I am concerned about some of the price controls that are being talked about. It isn't that I'm against prices falling, as I would welcome lower energy prices and falling rents, but caps and other fixes usually have the opposite effect to what is intended.
Like batchboy stated I would be more concerned about some of the smaller or nationalist parties having a large influence. Would you want someone who can influence the UK government who has the long term aim of breaking up the union?
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mikes1531
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Post by mikes1531 on Apr 28, 2015 15:06:50 GMT
I note that someone is suggesting hitting building sites with planning permission with their full rates charge after 3 years of ownership even if the building is not built yet. Should end up with pass the parcel :-) Sounds like it would be an ideal time to invest in estate agents and conveyancing solicitors!
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Post by norfolkblue on Apr 28, 2015 15:40:59 GMT
Yes, it's the price controls that worry me - and while It's easy enough to stay away from investing in Energy, I normally like a healthy slice of my portfolio in Real Estate.
Labour have got on to something clever (but dark) with their assault on Landlords , because it taps into the victim mentality which is prevalent nowadays. Everybody not happy with their own situations wants somebody to blame, and if they can be a direct victim, all the better.
I'm also worried about the anti-business mentality of the potential cabinet too - corporation tax is expected to rise with a Labour government (not necessarily because of a minor party) , maybe by as much as 6%, which would be a disaster to a lot of small businesses.
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adrianc
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Post by adrianc on Apr 28, 2015 17:45:06 GMT
No mention that this country needs a weaker currency and a much lower house prices (to reduce the cost of living) to make us competitive. At what? Manufacturing? There's no point in playing the very low-cost economies at the pile-'em-high-sell-'em-cheap manufacturing. Apart from just HOW low we'd have to go, it's as fickle as anything when it comes to location, shifting to chase the tiniest saving. OTOH, Germany consistently prove that if you can get the quality (or even just the reputation) right, there's absolutely no problem producing and selling premium goods at a premium price. Meanwhile, the middle ground is very crowded and getting ever more so. Surely we're far better off finding niche but lucrative industries that we're good at and investing in those? It's kinda hard to be so high in the list of the wealthiest nations in the world without being more than just "competitive" at something...
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bigfoot12
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Post by bigfoot12 on Apr 28, 2015 18:51:58 GMT
You should remember that the "grey vote" have contributed through taxes and NI payments for over 40 years before they retire and didn't have the plethora of benefits that a younger generation get such as paid maternity leave, childcare costs etc. If you think the Government should save money then look at these costs or perhaps that is too unpalatable for the major parties and the young voters. What price did they pay for their houses before they stopped any future building on their nice views? And I think most 30 year olds would swap their maternity leave for the pensions that the previous generation enjoyed.
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bigfoot12
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Post by bigfoot12 on Apr 28, 2015 20:32:21 GMT
The pensions that are enjoyed today were paid for by the tax and NI contributions of 45 to 50 years. They weren't though were they. The tax and NI contributions were spent.
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mv
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Post by mv on Apr 28, 2015 21:27:44 GMT
You should remember that the "grey vote" have contributed through taxes and NI payments for over 40 years before they retire and didn't have the plethora of benefits that a younger generation get such as paid maternity leave, childcare costs etc. If you think the Government should save money then look at these costs or perhaps that is too unpalatable for the major parties and the young voters. What price did they pay for their houses before they stopped any future building on their nice views? And I think most 30 year olds would swap their maternity leave for the pensions that the previous generation enjoyed. And grammar schools, free universities/grants
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