Buy-to-let investors – providing homes? Or profiteers and parasites? And beware Ed Balls.

As I’ve been blacklisted from ever working again as a consultant, I have plenty of time for the joys of daytime TV. One programme I watch while on my cross-trainer each morning is the BBC’s Homes Under The Hammer which features people buying homes at auction, usually to do up for the buy-to-let market. With interest rates at record lows, with shares likely to stagnate for the next five or so years and with most pension funds charging huge fees and not giving any growth, it’s understandable that people with a bit of spare cash are turning to property for an income and for their pension. But are these people providing a service by renovating and renting out houses and flats? Or are they just profiteers and parasites, pushing up house prices and then living off those who can’t afford to buy their own homes?

I think there are about 14.5 million homes in England (I don’t have the figures for the UK). Of these 14.5 million, around 3.6 million (a quarter) are buy-to-lets. If we assume that the average buy-to-let is costing £500 to £700 a month, this means that renters are paying £1.8bn £2.5bn a month (£21bn to £30bn a year) for their homes. That’s £21bn to £30bn a year being taken from the less well-off and put directly into the pockets of the better-off. Buy-to-lets add nothing to our national wealth, they just move money from one section of society to another. Moreover, as they account for about a quarter of home purchases, they push prices up beyond the means of many people.

At the moment, buy-to-lets seem to be profitable investments for the lucky few – at least that’s what gushing BBC presenters claim. But when Labour get back into power in 30 months time and the deluded liar Ed Balls goes on a Brownian spending spree, he’s going to need money – lots of it. And there, ripe for the picking is £21bn to £30bn being taken by buy-to-let owners.

Buy-to-let owners beware – it’s not unlikely that, under the banner of “fairness”, the repulsive (IMHO) Balls may be coming after your money. After all, there’s not much else left for our incompetent, wasteful, financially-incontinent governments to tax. Mr Balls may make you rue the day you ever entered the buy-to-let market