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  • Buy-to-Let

    How many investment properties is enough?



    Hi all,

    I am just wondering how some on here view the property business?

    I thought DL started a great post this morning with some great input from others on their various deals.  I find buying a new property almost an addiction, if I have not got an auction to go to or a deal lined up I seem to get all grumpy. I am wondering when enough is enough?

    I guess to a point, it depends on age and who is coming on behind you.It would be great to hear others point of view.

    Cheers.

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    The BTL business is over and done with. Those entering now will find increased costs as new rules and regulations are put in place by local councils and government.

    Rent controls and great protection for tenants will result in many giving up as profit margins get thinner and thinner.

    Those getting in now and those still holding on with leveraged positions will get wiped out within the next 12/18 months. Just read these tribes as more and more seek advice on non payment of rent, re- mortgaging ,and buying more property.

    They should listen to the experienced ones and see how many are selling up or have already or reducing their property exposure. Your addiction is serious and my advice is to seek help before its too late.

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    I wonder where you get your crystal ball from. Its true profit margins are taking a hit with the new legislations but businesses adjust and BTL is no different. What is this event you see coming in 18 months time...?
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    you don't need a crystal ball just look around you. Jobs losses, high street in melt down, asset prices over blown, massive debt across the world. US debt if taking all those hidden costs they don't want you to know about is closer to £200 trillion.

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    All those things you've mentioned are as predicted. Recessions come and go, it's part of how the world's economic structure works.  You've mentioned the U.S debt is £200 trillion. Let me ask you this, is that a real debt? Who will come to collect?  

    Since you believe that our economy will break down in 12 months time and BTL is no longer viable have you sold all your properties and buried your cash somewhere?
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    I sold all my properties bar one some time ago. Cash is stored in safe haven gold and silver. some facts for you. US national debt $20bn, hidden debt $107bn ( ie unfunded liabilities primary to veterans. pensions, social security  and medicare payments) total real debt $120bn but economists set real number is $200bn. Billions are pilling up every year and the problem is how to fund this debt service. Traditional buyers of treasury bills were Russian and China they have been net sellers for ages and building up gold reserves. European debt is also massive but the biggest problem is Japan with the largest debt of 1 quadrillion yen. So even if they have a budget surplus of 1trillion  per year it would take 1000 yrs to repay it. Some say it does not matter but with an all time high of world debt some how it has to be financed. Hence the reason the fed is trying to reduce interest rates. This is all becoming a extremely dangerous financial situation all round and Governments do not know how to contain it. Those are the facts and ignore them at your own peril.

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    I think all that you have mentioned is true. But I still don't see how you have concluded that it will result in an economical crash in 12 months time. Why not 5 years or 10 years or 50 years. What event will cause this crash? Global debt is increasing but when will it come to an end no one can predict that accurately so it's best to carry on as normal with investments and making sure you are not over leveraged as usual. Best of luck.
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    I’m bradly in the same camp, BTL is in for a hard time, much of it is an attempt to reduce overall leverage across the sector so that in the event of credit tightening and or rates rise , there is not a widespread default on btl loans which could conceivably bring about a considerable correction to the property market by itself. 

    Things are no rosy for a huge number of people financially, many are reliant on short term credit and unable to cope with a rainy day. I spend a reasonable amount of time on the roads, over the last year or so there has been a marked rise in the number of vehicles you see broken down at side of road, there are considerable numbers of vehicles with defective lights and at night there are considerably fewer cars on the road. People just don’t have the money to maintain or use their cars they way they did, to me it points to a real lack of disposable income.

    Property prices are softening , especially so for those in need of more than a quick freshen up. None of it is a problem so long as the slowdown is managed, but it won’t take much to put the skids under things. 

    Only two of my tenants could survive a loss of income for more than a month or so and only 2 could afford their current rents if reliant on benefits and pensions alone.

    Nothing that can’t be worked with and worked around , just for me a case of being aware of downsides.
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    Phil,

    I agree with what you are saying. Always tread with caution and over analyse each deal. But that applies to every investment. I don't understand when others advise people to completely stay away from BTL. Guess we will have to see what happens, times are hard but always pays to work through it.
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    ``I don't understand when others advise people to completely stay away from BTL.`` 

    The people who do so sometimes  do this when they have sold up or divested their investments away from BTL . They want comfort to be able to say they sold at the right time  so kinda subconsciously want a crash to prove themselves right.  Or they are selling other services maybe and want to convince others to cash in their BTL cash and buy into whatever they are selling. Conversely those who stick with BTL ( like me ) may lean in the other direction and shout that BTL is  still the bees knees. Recently we have seen a flurry of people who think they have the answer and are not shy in sharing their views. One has to dig beneath the soundbites to see whats going on in their respective lives

    Property  in my view was absolutely brilliant and is now just very good .

    I like very good because it stills beats good , average or poor

    The truth though can only be ascertained maybe a decade or so down the line .

    In 2007 ( if I had known ) I could have sold everything before it dropped 20%

    People smiled at me who didn`t have property in a kind of `serves you right` sort of way

    But I hung on and stuff is now up maybe 60%  on pre crash prices where I invest

    Recessions and house price crashes are all part of the game. We know they are going to happen

    I pass by a property every day which was snatched from me .

    Its 100K more now and I couldn't buy it for various reasons at the time and it hurts

    I stick with BTL because I dont want to miss out on the next 100K gains

    Because if  I bought 10 now @ 100K that would make me a million in maybe 20 years from now

    Sophisticated HNW investors are quietly acquiring portfolios ..

    They know  - Time is very kind to property

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    Jonathan Clarke. http://www.buytoletmk.com


    Spot on, your posts are always a good read. I'm glad to hear you've weathered the storms before and plan to do so again. I see plenty opportunity even in today's market and if it makes sense I plan to buy. There are things that are out of our control and as long as I'm sensible I hope to be still here when the dust clears. Best of luck.
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