Interest rate cut

[paul99]

Seems not all lenders are going to be passing this on, at least not straight away - what's the scale of this?

[pugsy]

I always get mine, eventually. It takes my lender BM 2 months to put the rate up and then 2 months to bring it back down again, so very fair really. No complaints.

[Selkirk]

Pugsy you must have some sort of discount or tracker mortgage where they pass on the full adjustment (tracker) or full/partial (discount) and you are still in your deal. However, anyone taking out a new mortgage be it buying or remortgaging is not getting much if any benefit from the last two rate cuts, some lenders have increased arrangement fees and have increased their margins on trackers and discounts - their greediness caused the credit crunch and guess who pays...

cheers

[GPEL]

I think it's the general public's greediness that caused the credit crunch; it's just easier to blame estate agents and the banks/lenders for problems now because they catered for our desire to sell our houses for as much as possible, quick release of equity to improve our standard of living and easy access to good credit facilities. The interest rate manipulation isn't because we're in recession but is to directly or indirectly control rising house prices, increased borrowing and debt, which it's doing. Banks are commercial ventures and have to find some way to offset the irresponsible for example those that go overdrawn and then whine about charges etc. Those that don't go overdrawn will end up losing free banking. Believe me, we have it good, I only have to cough and my Portuguese bank charges for it. More need to take responsibility for their own actions not blame others (just seen the article about the gambler suing cos the bookies let him bet to much - sounds like he's trying it on & still taking a gamble).

Touchpaper lit.

[Simon Dewsberry]

With you all the way Gpel

Anyone overstretched has only themself to blame .....and if they get repo'd then that , IMHO is their own fault ...a risk THEY took..... albeit assisted by greedy lenders .....I do feel sorry for the LLs who were duped into buying new build apts (waterside and city centre ...though) as they wer conspired against by hype, the market, some slick sales campaigns, greedy overlending, deluded valuers, and ridiculous incentives 1-3 years rent guarantee etc....on a disney type deal .....these are turning out as expected (by me at least) to be nothing other than the Tenament ghettos that took years to get rid of, full of undesirables, unlettable and unsaleable monstrosoties (sp ?!) that were pointed out as such, many years ago by HRH Prince Charles so many years ago when Canary Wharf went up ......If only national planning exec had paid attention .....Personally i think they they are fit for nothing other than bulldozers ...are a blot upon the landscape and a breeding ground for financial dissarray for all owners ......

Most look disgraceful ...and at present i think you would be well advised to put your Dep money on red or black in your local casino ....you will probably be financially better off ...even if you lose the lot ...you will lose more by investing in this non sense .....

Time will tell .....

Flatten the lot ...I say !

Anyone out there who has made a profit on such a development ....even broken even (dont forget management fees, car park spaces( at 10k- 40K a pop) please come forward and dispute the above .......

I am not holding my breath for even ONE reply.......

You didn't need to be a rocket scientist to see the flaws in this tpe of opp ....

The Rodent

[Matthew]

I'm waiting for Paul to reply on this one as he works for Inside Track. However I agree with Rodent on this one, many people have been duped.

Anybody with a bit of intelligence could see that these were rip-offs, but the problem goes back to something my Dad said to me when I was at School.

"When you go to work you will realise that most people are thick".....I have found this to be very true.

What is common sense to the likes of myself and Rodent etc...isn't to others. These property investment companies have gone out of their way to fleece "civilians" and found inventive ways of doing so. Finally it seems they are being investigated, I only hope that they end up having to pay the mortgage shortfalls after the repos.

Fair dinkum mate!

[Simon Dewsberry]

To be fair "Inside Track " and other such companies were actually geting the props into LL hands with fairly large discounts on "percieved market value" so peopel using this route are probably slightly better off than the "go it alone investor " altho with out the involvemant of these co's they probably would not have become a purchaser at all ....which as we are seeing quite clearly would have been a better situation to be in ..

The guy who "heads up/owns?" Inside track is called Jim Moore who is one hell of a guy ...credit where credit is due ...he personally taught me most of what i know about sales, motivation, goals, physcology and wealth creation. This not thru IT but activities from a " former life " !!!!!!!!

There is only space in this world for a handful of people like him !!! I know several of the top speakers at IT and i am not doing them a marketing plug here ....but they have some very clever ideas polished into a good blueprint for wealth creation when taken as a whole ....the IT opportunity is built on multiple income streams NOT just BTL landlording ......from my limited research of IT and knowing the guys behind the co ...if i was going to invest in one of these co's it would be IT ....

Why havent i done it yet ???

Well ....keep threatening to ....but same old "too busy" .......not enough fingers for the pies that i have got already .!>!!

Maybe later this year i will carve out some time and do the course !!!

In summary (for Matt) probably not fair to blame IT solely for ALL the luxury apt problems !

The man himself : http://www.jimmoorewealth.co.uk

The Rodent

[pugsy]

To be fair "Inside Track " and other such companies were actually geting the props into LL hands with fairly large discounts on "percieved market value" so peopel using this route are probably slightly better off than the "go it alone investor " altho with out the involvemant of these co's they probably would not have become a purchaser at all ....which as we are seeing quite clearly would have been a better situation to be in ..

The guy who "heads up/owns?" Inside track is called Jim Moore who is one hell of a guy ...credit where credit is due ...he personally taught me most of what i know about sales, motivation, goals, physcology and wealth creation. This not thru IT but activities from a " former life " !!!!!!!!

There is only space in this world for a handful of people like him !!! I know several of the top speakers at IT and i am not doing them a marketing plug here ....but they have some very clever ideas polished into a good blueprint for wealth creation when taken as a whole ....the IT opportunity is built on multiple income streams NOT just BTL landlording ......from my limited research of IT and knowing the guys behind the co ...if i was going to invest in one of these co's it would be IT ....

Why havent i done it yet ???

Well ....keep threatening to ....but same old "too busy" .......not enough fingers for the pies that i have got already .!>!!

Maybe later this year i will carve out some time and do the course !!!

In summary (for Matt) probably not fair to blame IT solely for ALL the luxury apt problems !

The man himself : http://www.jimmoorewealth.co.uk

The Rodent

[GPEL]

Totally agree about the apartment hype and clever(fraudulent?) marketing. Nearly went for one myself in the early days and lost a bit of a deposit when I backed out but a small price to pay. I did my own due diligence on the forecast rental valuations and growth and avoided a huge loss later by pulling out from buying a new build in Nottingham.

[Matthew]

Yes it is the developers and the property investment companies which have caused this, not just the property investment companies. BUT Inside Track are one of those, and are one of those which have been targetted by TV programs of late (The Truth about property).

To be fair they were the only company that actually would speak to the BBC, so that does show something......but the guy couldn't answer for the fact that many of the developments were now woth way under what was paid for them.

What gets me is that it has taken so long for this to be made public....and you can see why, every paper has loads of these new build ads throughout the paper....it is a conspiracy!

I still think that more awareness is needed on the subject.....but this could result in nobody wanting to buy any new build flats.......could in turn result in bankruptcy of big firms such as Barrats.....who may end up having to broker a deal with the Council to buy whole blocks for peanuts... in the meantime less building will go on, blocks will remain empty and rents and "normal" house prices will go up......extreme, but could happen as I think the word is spreading, and once it has it will be difficult for people to ever trust new build flats again.

[pugsy]

Sorry Rodent, drumroll please....I've bought a few new-build off plans in recent years and they've been really good. We overpaid I thought, for one of them, because we went for top floor, penthouse almost, BUT, it has the WOW lettability factor, it's never been empty and the mortgage has always covered the rent, leaving some extra for bills, etc. Two other smaller flats, also off plan but not waterside were bought simply because they were new and very cheap, no frills exactly, but they've increased in value and are still cheap by most of the UK's standards. My only gripe with those ones is, as R points out, the service charges are too high (about 670 p.a.) . My last new build has been an absolute diamond I get positive cash flow of £230 AFTER the letting agent has taken 10% and it has increased in value by anywhere between 75-100K since last year (resales are in that region, plus we have sea views, so should be top end). Bonus it's a freehold house, so no silly service charges. We bought directly, no third parties, bought the best units for the purpose and were not caught up in the incentives trap. Any good investor knows in their heart if something, whether they are buying property or stocks, is cheap or not and that saying of you make your money when you buy a house, is so true. So long as you're matching up that property with a really good finance deal, it's idiot-proof isn't it?

Sorry to stray off the subject a little, but personally I think British attitudes need to change, the country is sooooo small and is not getting any bigger! So flats, apartments, whatever you want to call them, are they only way forward. I remember looking at a new build waterside development once and the agent telling me how many hundreds of units were being built and I said (having lived overseas most of my life), where is the school going to be? She looked at me like I was mad and said what school, I said for the children of the families who will buy the flats, of course. Oh ... but families with young children don't buy apartments. I looked at her like she was mad as this is not the case in the rest of europe or other big cities worlwide. I think if developers in the UK allocated a bit more space to a development and really thought about making each development a lifestyle development instead of little boxes. whether that's a kids playpark, some greenery and beautification, a small gym/spa or god forbid a small basement or rooftop swimming pool...put up a security gate or two and if that became the norm, as it is in many other places around the world, attitues would change, people would see the benefits. Plus a bit of clever marketing towards families and a bit of thought into schooling by townplanners... I am overseas temporarily and have left behind my beautiful detached and am now in a duplex apartment with spouse and 3 kids. Never saw myself in a flat at this point in my life, but here we are, but, there's no garden to do, outside my front door is swept everyday, there's a consierge to accept deliveries, safe gated gardens and streets for the kids to play, a pool, spa, gym, etc. Other nationalities do not seem to care, house, flat it's all the same to them, but for the British it's like a stigma.

To all UK new build owners out there, have faith, at least in theory, there is a housing shortage in the UK, right? Tenants and purchasers are on the horizon waiting for the right conditions... hopefully and at worst, flog it for a loss at auction and lick your wounds. You could not even do that in Spain right now! There's tens of thousands of empty properties and something of a people shortage, entire towns are running at 20% occupancy! Crazy huh, it's meltdown on a grand scale! Good time to start a vulture fund!

[Simon Dewsberry]

Sorry Rodent, drumroll please....I've bought a few new-build off plans in recent years and they've been really good. We overpaid I thought, for one of them, because we went for top floor, penthouse almost, BUT, it has the WOW lettability factor, it's never been empty and the mortgage has always covered the rent, leaving some extra for bills, etc.

Does it have the same WOW factor on the balance sheet ?

Two other smaller flats, also off plan but not waterside were bought simply because they were new and very cheap, no frills exactly, but they've increased in value and are still cheap by most of the UK's standards. My only gripe with those ones is, as R points out, the service charges are too high (about 670 p.a.) .

If they were cheap then not sure they fit into criteria Matt and i were refering to !

My last new build has been an absolute diamond I get positive cash flow of £230 AFTER the letting agent has taken 10% and it has increased in value by anywhere between 75-100K since last year (resales are in that region, plus we have sea views, so should be top end). Bonus it's a freehold house, so no silly service charges. We bought directly, no third parties, bought the best units for the purpose and were not caught up in the incentives trap. Any good investor knows in their heart if something, whether they are buying property or stocks, is cheap or not and that saying of you make your money when you buy a house, is so true. So long as you're matching up that property with a really good finance deal, it's idiot-proof isn't it?

As a free hold house clearly not in the "apt" discussion ....but brilliant result for the pension pot tho !

£230 pcm or pa and what in % terms as this is a bit too vague for me!!

Sorry to stray off the subject a little, but personally I think British attitudes need to change, the country is sooooo small and is not getting any bigger! So flats, apartments, whatever you want to call them, are they only way forward. I remember looking at a new build waterside development once and the agent telling me how many hundreds of units were being built and I said (having lived overseas most of my life), where is the school going to be? She looked at me like I was mad and said what school, I said for the children of the families who will buy the flats, of course. Oh ... but families with young children don't buy apartments. I looked at her like she was mad as this is not the case in the rest of europe or other big cities worlwide. I think if developers in the UK allocated a bit more space to a development and really thought about making each development a lifestyle development instead of little boxes. whether that's a kids playpark, some greenery and beautification, a small gym/spa or god forbid a small basement or rooftop swimming pool...put up a security gate or two and if that became the norm, as it is in many other places around the world, attitues would change, people would see the benefits. Plus a bit of clever marketing towards families and a bit of thought into schooling by townplanners... I am overseas temporarily and have left behind my beautiful detached and am now in a duplex apartment with spouse and 3 kids. Never saw myself in a flat at this point in my life, but here we are, but, there's no garden to do, outside my front door is swept everyday, there's a consierge to accept deliveries, safe gated gardens and streets for the kids to play, a pool, spa, gym, etc. Other nationalities do not seem to care, house, flat it's all the same to them, but for the British it's like a stigma.

To all UK new build owners out there, have faith, at least in theory, there is a housing shortage in the UK, right? Tenants and purchasers are on the horizon waiting for the right conditions... hopefully and at worst, flog it for a loss at auction and lick your wounds. You could not even do that in Spain right now! There's tens of thousands of empty properties and something of a people shortage, entire towns are running at 20% occupancy! Crazy huh, it's meltdown on a grand scale! Good time to start a vulture fund!

"Other nationalities do not seem to care, house, flat it's all the same to them, but for the British it's like a stigma."

BUT then

"You could not even do that in Spain right now! There's tens of thousands of empty properties and something of a people shortage, entire towns are running at 20% occupancy!"

You trying to confuse me or what ?!

The Rodent

[pugsy]

Apologies, I was having a slow morning and clearly rambling a bit. But your first point, it's not a mega wow factor, I would say 8% p.a since, but more importantly, it's stress free, because it's in demand, good equity, no probs remortgaging. Interestingly, 2 1/2 years ago when this flat was bought, our lender insisted on a 20% deposit because of it's new build status, must have had a crystal ball! (As for my new build house it's a pcm profit, but I admit that's not the norm).

My comments on Spain I guess are confusing if you've not experienced it, but it's in full-on recession. There are just too many properties full stop and there are literally thousands upon thousands empty, regardless of whether a flat or villa. Dodgy developers (and corrupt town planners) have ruined the country and unlike Britian, there's not enough tenants or buyers to correct the balance in years to come. So Britain (even with it's glut of new builds and credit crunch still looks pretty rosy to me. It's unfortunate that new-builds get tarred with un unsaleable/unlettable brush, they're not all bad. That said, I admit too many have been sold to investors and I hope that when buyer confidence returns, all the dopey investors sell them cheap to owner-occupiers, particularly ftb's... maybe one or two to me!