In December 2015 Fergus and Judith Wilson began to take their last steps off the UK property ladder, putting their 900 UK buy-to-let properties up for sale to a pool of foreign investors.
A recent report with Britain’s biggest landlord has revealed some of his insights on the UK property market.
On exiting the UK property market
Mr Wilson told the Telegraph: “Buy-to-let became an obsession for me. I am a self-confessed junkie. Each day I must have my daily fix. I look up prices and say to myself what a lucky man I am.”
At the age of 67, Mr Wilson said he was sorry to be giving up on his properties but he was not “getting no younger” and “common sense must prevail”.
It may be be a good time for Wilson to exit the market, especially with a potential £200m in profit (once fully sold and after repaying about £45m to 14 lenders).
Insight: While most landlords and investors won’t be able to exit market £200m in profit, a solid property investment portfolio will pay off in the long run.
On the end of the “amateur landlord”
In a recent interview with the Financial Times, Mr Wilson lamented the end of the “amateur landlord”. Talking about his early steps in property, he said: “If you were an amateur landlord in those days, as long as you could spell your name, you would get a mortgage. No one appeared to check anything. I wouldn’t say it is impossible but it is much tougher. Some [banks] are offering loan-to-value of only 60 per cent.
“Is it the wrong time to be an amateur landlord? Yes. Some people will succeed but ‘on the whole’, too many amateurs walk into pitfalls… The day of the amateur landlord is over.”
Mr Wilson told The Telegraph of the couple’s success: “It was remarkably easy because no-one knew what they were doing. I didn’t care if I didn’t make a profit as long as I owned the properties. I knew they would rise in value eventually.”
Insight: The ‘hay days’ of the 90s are long gone, leaving only professional investors and landlords. The UK property market is no longer a hobby; it’s a serious business.
On the EU Referendum
In the same interview he said he believed the Brexit vote would ultimately bolster the selling process. “I think foreign buyers are saying at the moment that Brexit helps as it is cheaper [property] in their money [after the fall in GBP]. Many … are trophy hunters — they want to impress their friends with a photo of the house they own in Britain.”
Mr Wilson told The Telegraph he did not vote in the EU Referendum, but if he did, he would have voted Leave.
Insight : When one door closes another opens, reports support Mr Wilson’s assumptions may be correct with the BBC Reporting an increase in overseas investment.
On the future
Mr Wilson went on to comment on the future of the UK property market. “All the time there is a shortage of houses, the prices will continue to go up,” he said. “It is impossible for the developers to deliver the number of houses required for the next 15 years.”
Update: A report done by the Royal Institute of Chartered Surveyors in October 2016 indicated that, without action, the 1.8m extra households looking for rental property would be out in the dark by 2025.
How the Wilsons grew their portfolio
Fergus and Judith Wilson are both former maths teachers. The couple, already home-owners, began buying houses when prices were low in the early 1990s.
The launch of the buy-to-let mortgage in the mid-1990s enabled the Wilsons to expand as high loan-to-value interest-only mortgages were easy to acquire at that time.
In 2009, the couple were named as the 34th richest couple in the UK by the Sunday Times Rich List.
A track record not without controversy, in 2014 Wilson caused media furore after evicting all his tenants who were on benefits.
The couple relied heavily on leverage to build their portfolio, buying only new-build houses and re-mortgaging them as soon as prices went up, using the profits to finance further purchases.
Sources
https://www.ft.com/content/a138583e-768b-11e6-bf48-b372cdb1043a
http://www.telegraph.co.uk/finance/personalfinance/investing/buy-to-let/12041564/Fergus-Wilson-Britains-most-iconic-buy-to-let-investor-sells-up-all-900-houses-for-250m.html
