UK has even worse, buy to let. Interest only with the intent of renting it out. So you profit on the rents and profit on the house going up in value. Obviously you vote for governments that will lead to an increase in house prices too. Oh yeah most of government is made up of parasites landlords too.
Comment on Bank Workers, Rejoice!
ivanafterall@lemmy.world 11 hours agoHow would that work, even on paper? Not being a dick, just don’t understand. So it’s literally just, “you can never own this property fully?”
Korhaka@sopuli.xyz 9 hours ago
ivanafterall@lemmy.world 9 hours ago
Sorry, my brain is struggling. How is this different from the U.S., for example? Isn’t it the same? If you buy, the only way to make money is to improve or rent out to someone even more desperate…?
boonhet@sopuli.xyz 8 hours ago
Normally you also make payments towards the principal and build equity. As I understand, most of these buy to let loans actually only have you pay interest so you’ll never own the property. If the value even after 20 or 30 years drops below the initial value, you’re in the negative and need to pay up the difference if you can’t make payments anymore. Whereas with a normal mortgage once you’ve paid it off, fluctuating values can’t put you in severe financial trouble.
partial_accumen@lemmy.world 11 hours ago
Yes. The tradeoff is you have a property that is in your name (with a bank note attached), and if the property increases in value during the time you own it, when you sell, you pocket the difference. If you have a fixed interest rate, it also caps the growth of your payment for housing for the entire time you live there. There’s quite a bit of value in that.