Sale and rent back operators question need for regulation says Lawrenson at Lettingfocus.com
Following on from yesterday’s lettingfocus.com blog calling for the need for more regulation of sale and leaseback, I thought I should just balance out the debate by putting the view of one landlord who contacted me.
So here goes. And thanks to Mr. P for this one.
“Buy and rent back regulation. Hmm are people that daft that they need protection from their own stupidity. I would agree that some of the promises are ludicrous, but if there was not a market for this kind of deal then it would not happen
This week I agreed with two other landlords to do exactly this, the first adverts go in the paper this weekend, with the idea of putting portfolios of 5-10 properties and then selling the portfolio on. We have contacts who supposedly want to buy them, but time will tell
The scenario is the same as those put to us through mortgage advisors/estate agents when someone is facing repossession. If someone has spent more than they can afford they need someone to dig them out of the mess of their on making.
They can always turn down our offer, but I suspect they need the money quickly to stave off repossession/bankruptcy proceedings.
I had one last week, he is in debt to the tune of 120K, all secured against a property worth max 90K (if perfect, which it wasn’t), and was 7 days away from repossession and bankruptcy court hearing. However he and his family went on a nice cruise recently - so I guess it is obvious where his priorities lay.
However he turned down our offer (of 10%ish below true price), but I suspect now has nowhere to live and will be phoning our rental adverts, but with his record of not paying his interest only mortgage of £500, what makes us think he will pay rent of the same amount
Or am I being too hard nosed on poor unfortunate people who obviously are not responsible for their own lives &r the mess they make of them.”
At lettingfocus.com, I have some sympathy with that position.
Looking at it this way, by selling to a landlord and becoming a tenant, the vendor turned tenant cuts out some costs - he saves on estate agency fees and also HIPs (because as the property is not marketed it should not need one) and he gets to stay in his own home too (at least for a time) Maybe at the bottom line, what’s really needed is for the government to provide some sound financial education for people as part of the core curriculum at school, so they would not make a mess of things in such ways.
If you need more advice on buying property below market value or buy to let investment in general please ask me. I’m David Lawrenson from property investment advisors www.lettingfocus.com
I’m the author of the buy to let book “Successful Property Letting - How to Make Money in Buy to Let” the UK’s top selling property title.I’m an expert on property investing for profit and a well known property freelance writer and I contribute to newspapers and a host of property websites, write a property investment blog and run a landlords advice service.
I also work as a consultant helping banks, building societies, housing associations and web portals with their buy to let and property products and services.You can read more of my property investment blog and details of my networking, advice, property networking programme at my website www.lettingfocus.com.My next London landlords networking meeting is on March 12th. Click here for details: Property Investment AdviceWhat’s unique about lettingfocus.com is that we offer independent property mentoring because unlike most people in the buy to let and property “advice” business we are not linked to a property company, developer, agent or bridging loan financier and do not receive commissions from any of these sources.If a property investment is lousy – We’ll tell you straight and we will tell you all about buy to let and property investment - the good and the bad and we won’t make silly promises that you’ll become a millionaire overnight.Copyright: David Lawrenson. This blog is updated at least twice a week. Permission must be sought before using the material in the blog.
So here goes. And thanks to Mr. P for this one.
“Buy and rent back regulation. Hmm are people that daft that they need protection from their own stupidity. I would agree that some of the promises are ludicrous, but if there was not a market for this kind of deal then it would not happen
This week I agreed with two other landlords to do exactly this, the first adverts go in the paper this weekend, with the idea of putting portfolios of 5-10 properties and then selling the portfolio on. We have contacts who supposedly want to buy them, but time will tell
The scenario is the same as those put to us through mortgage advisors/estate agents when someone is facing repossession. If someone has spent more than they can afford they need someone to dig them out of the mess of their on making.
They can always turn down our offer, but I suspect they need the money quickly to stave off repossession/bankruptcy proceedings.
I had one last week, he is in debt to the tune of 120K, all secured against a property worth max 90K (if perfect, which it wasn’t), and was 7 days away from repossession and bankruptcy court hearing. However he and his family went on a nice cruise recently - so I guess it is obvious where his priorities lay.
However he turned down our offer (of 10%ish below true price), but I suspect now has nowhere to live and will be phoning our rental adverts, but with his record of not paying his interest only mortgage of £500, what makes us think he will pay rent of the same amount
Or am I being too hard nosed on poor unfortunate people who obviously are not responsible for their own lives &r the mess they make of them.”
At lettingfocus.com, I have some sympathy with that position.
Looking at it this way, by selling to a landlord and becoming a tenant, the vendor turned tenant cuts out some costs - he saves on estate agency fees and also HIPs (because as the property is not marketed it should not need one) and he gets to stay in his own home too (at least for a time) Maybe at the bottom line, what’s really needed is for the government to provide some sound financial education for people as part of the core curriculum at school, so they would not make a mess of things in such ways.
If you need more advice on buying property below market value or buy to let investment in general please ask me. I’m David Lawrenson from property investment advisors www.lettingfocus.com
I’m the author of the buy to let book “Successful Property Letting - How to Make Money in Buy to Let” the UK’s top selling property title.I’m an expert on property investing for profit and a well known property freelance writer and I contribute to newspapers and a host of property websites, write a property investment blog and run a landlords advice service.
I also work as a consultant helping banks, building societies, housing associations and web portals with their buy to let and property products and services.You can read more of my property investment blog and details of my networking, advice, property networking programme at my website www.lettingfocus.com.My next London landlords networking meeting is on March 12th. Click here for details: Property Investment AdviceWhat’s unique about lettingfocus.com is that we offer independent property mentoring because unlike most people in the buy to let and property “advice” business we are not linked to a property company, developer, agent or bridging loan financier and do not receive commissions from any of these sources.If a property investment is lousy – We’ll tell you straight and we will tell you all about buy to let and property investment - the good and the bad and we won’t make silly promises that you’ll become a millionaire overnight.Copyright: David Lawrenson. This blog is updated at least twice a week. Permission must be sought before using the material in the blog.
This entry was posted by lettingfocus, on
Thursday, February 21, 2008.
