Loans Scotland

Are buy to let owners speculators or investors who take otherwise undesirable properties, maintain them and provide a rental accommodation sector that local councils no longer provide?

As various experts ponder on the long term future of buy to let and also question whether the sector contributes to the economy or simply pushes up house prices, for many owners they see themselves as entrepreneurs who with few tax incentives take properties cheaply and then invest to make them available for rental.

Certainly markets like Edinburgh in Scotland have offered great opportunities to buyers with a huge demand for properties from renters and a steadily increasing price. How much of that is students and how much immigration is a very interesting question that should play out over the next few years.

One things buy to let owners should remember. They are largely viewed as speculators and so should not expect much support from politicians who are likely to see them an easy target for taxation. The latest changes in capital gains are not aimed at them, but at the same time nobody is crying for them either. Seatbelts, gentlemen!

Mysupermarket.com reports that prices for a basket of 25 goods has risen by an average of 12% over the past year which equates to an extra £750 extra per year for the average household.

Debtbusting solution? Buy less, buy with more frequency, and buy more carefully.

A visit to the supermarket and a scan of the trolleys around you reveals an inordinate amount of poor quality food being bought and also in large quantities by the average household. If these same people were to eat less then bills would go down. It is not a question of requiring supermarkets to reduce prices as typically they squeeze farmers and suppliers rather than themselves; it is a matter of us the consumer eating and buying less. With the UK the most obese nation in Europe, that can only be a good thing.

There are mixed signals on Edinburgh property market: the Edinburgh Evening News and ESPC puffing like mad and Jo Citizen saying it is nothing but propaganda - read the comments on The Scotsman.

Edinburgh, like London has a mind of its own as “buy to letters” pour in to buy quality and supposedly high rental incomes.

Round the corner from Windsor Street, a tenement has had some serious structural work required costing each owner £60,000. Takes a quite a housing market to cover that sort of expense!

MoneyExpert believes that 1 in 3 applications have been rejected - or an estimated 372,000 of the 1.2 million people applying for a mortgage or re-mortgage in the past six months have been rejected. This is up from the 1 in 5 in the six months to March 2007.

This is the bread and butter of the housing market and suggests that moving house is going to be more difficult, that getting onto the housing market will be more difficult and taking equity out of houses will be much more expensive (actually the last is not a product of the argument, but let’s assume this is true.)

At the same time people with credit cards are finding unsecured loans more difficult to come by.

All grist to the mill for those who expect to see the housing market slump.