Pour one out for the struggling landlords

⚡ The Spark
Pour one out for the struggling landlords

How are they supposed to make an honest living when money’s no longer free… /s

You right now:

We’ve written plenty about the UK property market over the years. When rates started to rise, it was obvious that the market would slow.

Who would be first to feel the pain?

Today’s UK Finance data confirmed that pain is starting to be felt now.

Debt: This chart shows the number of mortgages in arrears:

Some homeowners are starting to feel the squeeze, but in the grand scheme of things, there’s nothing especially alarming or unexpected.

7% higher than the previous quarter and 18% higher than last year isn’t ‘that many’ in absolute terms. (87,930 of roughly 8.5 million residential mortgages).

The big squeeze: But the Buy to Let sector?

Mortgages in arrears have doubled in a year.

Look at the momentum shift in the bottom chart:

The dark blue line is more ominous. Falling deeper into arrears… 😬

Landlords aren’t popular, especially the ones that levered tf up and pretended to be geniuses in a bull market.

This is how the market starts to heal. Remove cheap money from the equation and figure out what true values are.

We can’t trust house price indices for an accurate view on home prices either.

Distortions: When overall transactions are so low, the data can easily be distorted by a handful of outliers.

Plus they’re usually measuring the abstract concept of an average that doesn’t exist in reality.

So, even though mortgage rates are falling as markets wager that central banks will be forced into rate cuts next year, most of the pain may well be ahead of us.

For the over-leveraged landlords, it’s already well underway.

Staying on topic, why is the idea of property prices rising always pitched as an unquestionably good outcome? There’s more to it…

Watch:

@fink.tok

Heres the BIGGEST problem with the #ukeconomy and i dont really know why @Sky News still thinks it is good for property prices to outstrip... See more

🧠 The Big Brain
The New Narrative: What goes up must come down...

A week is a long time in politics financial markets

While that may no longer be the case for politics, in the age of policy making by social media, it’s still true of financial markets

And over the past week, definite signs have emerged that the narrative is shifting.

Today, Darren takes a look at this new narrative and the opportunities that may present on the back of it…

Pro Premium Members: click here to read/watch

Subscribe to Fink Pro to read the FULL Big Brain piece, every single day (currently 20% off annual subscriptions).

💡 The Lightbulb
Capitalism > Charity

Truth is like poetry: Why ‘everyone’ hates MrBeast now…

In case you missed it, MrBeast went to Africa & installed a bunch of wells (100ish) to provide clean drinking water for up to 500,000 people in Cameroon, Kenya, Somalia, Uganda and Zimbabwe.

Hats off to him. Taking some of the ridiculous sums he earns from ad revenues and putting them to work directly. Can’t really criticise him for it.

Kidding. This is 2023!

🤡 world: The hilarious thing is that the main critics quoted in the article are…

• A Kenyan Politician

• The head of a charitable organisation set up to solve these problems

The quote is beautiful:

In a rational world, she should be DELIGHTED & trying to team up with Beasty. Milk this cash cow for all she can. Finally solve the problems she’s been working on for fifteen long hard years.

Instead, she’s sulking because he’s getting all the attention & praise.

(Or because she can’t spend $83k of the $131k donations on annual salary for her and her mate)

How the world works: You ever wonder why nothing gets done?

It’s because there’s a plague of ‘in the way’ people. 

Getting paid to do NOTHING of substance.

Their job, either implicitly or explicitly, is to simply get in the way of progress.

You’ll spot them everywhere if you pay attention.

Committees, managers, planners, or just plain old activists.

The real pandemic.

Rotting gangrenous limbs that need to be amputated before they infect any more of the economy.

That’s the reason nothing gets done

Capitalism will always beat altruism. For one simple reason.

It’s focused on results

So when you look around and see problems that “should be solved”, ask yourself why they haven’t been.

Is this a capitalism problem? 
Or a ‘too many people in the f**king way’ problem?