Hero to zero.....Again....

Many of the once paper millionaire landlords out there could soon be worth nothing.

That's right .... zilch, zero, diddly squat, absolutely nothing.

I'll tell you why....

Many landlords have built property portfolios based on refinancing on the increased equity values.

Each time a property went up in value they refinanced, typically at 80% LTV, taking the new found equity out of one property to finance the purchase of another.

Many property investors built large portfolios based upon this very simple business model.

As there property portfolio, of say 30 properties, worth £6 million sat there with a LTV of 80%, they felt happy in the knowledge, that on paper at least they were worth £1.2 million.

However, as property price falls start to touch 20%, these same millionaire landlords have seen there equity in property fall to 0%, and are now worth nothing.

To add insult to injury many are now facing almost impossible re-financing options.

It would of been far more fun losing a million at the Casino in Monte Carlo, than on the steady decline of maisonettes in Lhanbryde.

Hope you're not one of them !

Until the next time.

Mr Jackson