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  • In the Spotlight

    Panel debate: Build to Rent vs. Buy to Let



    Yesterday at the Landlord and Investment Show, a new panel debate took place which was a look at the impact Build to Rent might have on private landlords.

    Due to a no-show, I was drafted in at the last minute to represent the landlord view!

    The panel was hosted by Michael Howard of Urban Bubble, a big BTR management company operating in Manchester and Liverpool.

    This makes for an interesting watch and you will see I made a few pertinent points!!!


    There are thousands of flats in the BTR pipeline and I believe that this makes flats an even less interesting proposition for investors, going forwards due to the huge supply of them in the offing, specifically in major cities like Manchester, Birmingham, Liverpool, Southampton, and London.

    Olympia de-brief:

    Landlord & Investment Show: Tracey Hanbury

    Talking HMOs with Platinum Property Partners

    Landlord & Investment Show: Shawbrook Bank

    Talking holiday lets with Mulberry Cottages

    Tackling damp and mould with Envirovent

    SEE ALSO  -         10 reasons to buy a house rather than a flat .... EVERY time.

    UP NEXT -             Olympia Show - debrief

    DON'T MISS -        The next LIS on the 12th September in North London

    NOW WATCH:

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    I think its quite simple

    1 if you are a lower rate tax payer buy in your own name

    2 If you are a higher rate tax payer buy in a company name

    3 If you leverage use the two above with care

    4 If you have the funds Build to rent is the way in your own name and If you can do it with cash its an uncomplicated thing to do and you avoid having to do 1 ,2,3

    It all depends on how deep your pockets are

    The Term Cash is King just make sure you don't borrow the cash to be a King other wise you are in a straight Jacket of Taxation and Company Taxation


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    Learn Change and Adapt ?????

    All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.


    Interesting video and well done Vanessa!

    BTR flats are todays shiny, and tomorrows sh1te!

    Look around you at the blocks built 15-20 years ago and look at the condition of the exterior.

    The guy hosting this video talks of 15 years for L&G and this is probably the timescale they look at. But what happens after that, 25 years down the line?

    All this makes me think is buy houses, they ain't making so many of them any more!

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    I have to agree with you flats are not the best investment for the reasons you have outlined.

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    Learn Change and Adapt ?????

    All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.


    Really excellent points raised by you Vanessa, good on you for being prepared to push the private landlord perspective in the face of the corporate ....  (*Moderator note: word removed*).

    You made a superb point about the personal touch and understanding your tenant - something very dear to me - and despite the host’s positive and upbeat answer, there is no way on earth any corporate structure will ever put in the care and patience the better end of the small private sector does. Not a chance.

    Well done Vanessa. Top stuff.

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    I sat in on this debate & it struck me as a very similar message to what has happened in the student let market.

    Institutional investment has, in most university cities, caused the small independent landlord to revisit his investment. We have large numbers of traditional student let landlords selling up or repurposing their properties as the yield is no longer there, I'm based in Cardiff.

    What is interesting in this presentation is the presenter does not mention the yield that the institutional investor is prepared to accept, from what I understand it is between 3-4%. How many landlords would accept this with the prospect of very little or no capital growth?) By p4oviding all the services he mentions, what would the yield be???


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    Interesting points you make about the comparisons.

    It appears to me that all of these 'extras' that are included are to get tenants into the building, but what happens after that is another story.

    As you say, what is the yield on these? How much are the maintenance costs year on year. I see flats like these starting to look quite shabby after 5 years on, for example the exterior as the often painted facades get mucky, but it's the cost to keep maintaining that will decide whether these sink or swim, plus there would need to be a % occupancy plus, how many tenants defaulting on rent will make it not a money maker? It's all very well credit checking people on the way in, but when they're nicely into that X year tenancy and have problems, it makes you wonder how good the relationship will be after a few months of rent default. Moving them to a smaller unit, hmmm, wonder if that would really happen.

    If the aim is the race to the bottom yield-wise then these sort of schemes are well on the way there imho. They already mention that there will be annual rent increases, whereas in the PRS there have been many years when there haven't been rent increases. Will the tenants finances make that possible?

    I would love to see some Google reviews on these places a few years down the line.

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    I looked up Urban Bubble on Rightmove. Their BTR rents for 2 bed apartments seem to start at double what I charge for a 3 bed semi  a few miles away.  They are giving high levels of service, but at a high price. So far in 4 years I have never raised the rent for an existing tenant, but they have built in rises.

    There is not an overall shortage of housing in this country, but a shortage of cheap housing. It seems BTR is not addressing the housing crisis.

    It is has been the policy of Manchester Coty Council to allow the building of expensive housing in the centre where land is expensive and use the surrounding areas for cheaper housing.so the building in the centre that was mentioned is mostly of luxury apartments.

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    A new survey has found that over a third of tenants across all groups are becoming increasingly aware of Build to Rent initiatives, and that 53% of all tenants said they were interested in them.

    Communal living is also gaining traction among tenants, with an average of 39% willing to pay more in rent for additional services and shared spaces like terraces and gardens, compared with 32% in 2017’s survey.

    “The survey findings support that renting spans all lifestages, and that tenants are seeking a rental solution that makes their life easier and more financially manageable,” said David Bond, Head of PRS & Build to Rent at PRSim.

    “Landlords of all shapes and sizes should be aware of differing priorities by lifestage and remove or remould barriers to renting.”

    Full/source article

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    BTR seems to be for the cream of the market, those individuals that have held good jobs over the longer term.

    The institutions are aiming to take the Grade A & B tenants and leave the Grade C & D tenants for private landlords.

    They can do this because the return required for pensions is only 4% or 5%, and they have buckets of money to fund the development.

    The large developers stand to gain here.

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