Old Conservatives don't understand

[ellal]

Which properties might that be

Ones which are identified as such...

Linky Linky

The true number could be higher of course

linky linky

 

[denso13]

It’s not just selling the houses for a loss, the council doesn’t have to maintain it anymore and the rent paid up to date will cover the loss.

No, that's a basic misunderstanding of council/HA funding. There is much more to it than bricks and mortar.

 

[nwgs]

No, that's a basic misunderstanding of council/HA funding. There is much more to it than bricks and mortar.

Unless you can explain how it’s wrong, it’s not!

The council couldn’t/cant Maintain their properties so sell them off to loyal tenants. Avoiding maintenance and freeing up cash.

It’s not a brilliant business model but it’s what they do.

 

[carmanmemoranda]

Unless you can explain how it’s wrong, it’s not!

The council couldn’t/cant Maintain their properties so sell them off to loyal tenants. Avoiding maintenance and freeing up cash.

It’s not a brilliant business model but it’s what they do.

Why can't they maintain them ?

 

[denso13]

It’s not a brilliant business model but it’s what they do.

It really isn't.

For a house at say, worth £300,000 with £1,000 per month rent. I'm not sure if those figures are realistic, but for arguments sake.

Council/HA stock has a book valuation, which is part of overall viability and they are often rated by credit reference agencies, with asset value one of the key indicators.

The book value also includes rental income, so £300k plus 30 years rent equals £660k, that is what it is "worth" to an owner.

So they have an asset worth £660k and could be forced to sell it at 70% discount which would be £90k.

So they have lost £570k on the books. For each home. Which can ultimately affect their creditworthiness. That really doesn't free up cash.

 

[JohnD]

It’s not just selling the houses for a loss, the council doesn’t have to maintain it anymore and the rent paid up to date will cover the loss.

So if private owners were forced to sell properties for less than their value, we'd be doing them a favour?

 

[Notch7]

The council couldn’t/cant Maintain their properties

Yes they can

Avoiding maintenance

It does not avoid the cost of maintenance

freeing up cash.

Only in the short term

 

[Notch7]

Why can't they maintain them ?

Because…reasons.

 

[carmanmemoranda]

So if private owners were forced to sell properties for less than their value, we'd be doing them a favour?

That's the logic.

If you can call it that

 

[SimonH2]

I don't know of any landlord not making money or increasing the value of his asset with somebody else's money

Actually, I put a LOT of MY money into my two small properties. The idea that it's cost me nothing is tosh. The opportunity cost of what I have tied up in them is "quite significant".
And if it was all "with someone else's money" then how come I still have bills when "someone else" isn't paying me ?
Applying strawman logic and taking it to an extreme, an owner-occupier is "increasing the value of his asset with somebody else's money". You go out to work, you get paid - so your house is paid for by your employer. Your employer "makes stuff" which people pay for. So now your house is paid for a large number of "other people".
Presumably you are also upset that (e.g.) supermarkets pay for their shops with "other people's money", that car parks pay for the spaces with "other people's money", and so on ?

 

[carmanmemoranda]

Actually, I put a LOT of MY money into my two small properties. The idea that it's cost me nothing is tosh. The opportunity cost of what I have tied up in them is "quite significant".
And if it was all "with someone else's money" then how come I still have bills when "someone else" isn't paying me ?
Applying strawman logic and taking it to an extreme, an owner-occupier is "increasing the value of his asset with somebody else's money". You go out to work, you get paid - so your house is paid for by your employer. Your employer "makes stuff" which people pay for. So now your house is paid for a large number of "other people".
Presumably you are also upset that (e.g.) supermarkets pay for their shops with "other people's money", that car parks pay for the spaces with "other people's money", and so on ?

Simply.

Are you charging your renter less than it costs you?

Is your asset value increasing ?

If neither are in your favour sell up and try something else.

 

[nwgs]

It really isn't.

For a house at say, worth £300,000 with £1,000 per month rent. I'm not sure if those figures are realistic, but for arguments sake.

Council/HA stock has a book valuation, which is part of overall viability and they are often rated by credit reference agencies, with asset value one of the key indicators.

The book value also includes rental income, so £300k plus 30 years rent equals £660k, that is what it is "worth" to an owner.

So they have an asset worth £660k and could be forced to sell it at 70% discount which would be £90k.

So they have lost £570k on the books. For each home. Which can ultimately affect their creditworthiness. That really doesn't free up cash.

Really ? That’s your argument!

I’ll check back later….

 

[JohnD]

One's heart bleeds to hear of all these people who invested in the rental business with the sole objective of losing money.

 

[carmanmemoranda]

One's heart bleeds to hear of all these people who invested in the rental business with the sole objective of losing money.

I know of lots of harder ways to make money

 

[nwgs]

So if private owners were forced to sell properties for less than their value, we'd be doing them a favour?

I’m not in favour of it! I can just about see the logic.

You’re so bitter John. Did you miss out on buying your flat ? Gutted.