Are asking rents falling nationally?

Seems right.

There was always going to be a saturation point and new supply is coming on, even in small amounts, in key urban markets.
 
NoRegretsCoyote said:
There was always going to be a saturation point and new supply is coming on, even in small amounts, in key urban markets.
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Yes, it's remarkable how sensitive rents (and house prices) are to even modest increases in supply.

Still, it's surprising to see headlines to the effect that asking rents actually fell (however marginally) on a nationwide basis over the last quarter of 2019. It makes you wonder what's the point of all the political posturing about rent freezes.
 
People forget that rents fell in 2002-2006. This was after rapid increase since about 1998.

This fall in 2002 to 2006 was despite a roaring economy and lots of inward migration.

Why? Huge amounts of new build.
 
So with a rent freeze you can't reduce the rent either. Or do they want a cap, which will just become the new minimum. They really shouldn't interfere. Just concentrate on the supply.
 
NoRegretsCoyote said:
People forget that rents fell in 2002-2006. This was after rapid increase since about 1998.

This fall in 2002 to 2006 was despite a roaring economy and lots of inward migration.

Why? Huge amounts of new build.
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Yes they seem like very well timed headlines with the election this week.
 
Some interesting commentary in the Daft Report on the effect of rent controls -

"What rent controls do – and we have already seen this with RPZs – is they turn the market into one of insiders and outsiders. Before RPZs, those with existing tenancies were enjoying smaller increases as well as none of the hassle of having to move. This gap between ‘stayers’ and ‘movers’ grew far worse with RPZs, as seen in the dramatic increase in lease length: even if it doesn’t suit you as much any more, once you have a place, you keep it.

A rent freeze would just accentuate this. The most vulnerable in the rental market – those new to the city, those without networks, those who have to move because of a change in household circumstances and those subject to all forms of conscious and unconscious bias – will lose out. Those with good social networks, higher incomes and stable circumstances will, once again, benefit. If that is what the public wants from public policy, then fair enough – but we should be explicit about it rather than claim that this is a policy designed to help those who need it.

What would have a far more serious negative impact is if these rent freezes were somehow linked to newly-built rental homes. This would, in effect turn off the supply tap overnight. We can see about 25,000 new rental homes on their way over the next few years. While this is still small relative to the gap between supply and demand, it will help."

So, rent controls harm the most vulnerable in the rental market. Is that really what we want?
 
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Looking at the manifestos of the major political parties each want to increase supply of property either social, low cost, private etc but none of them could say how they would do it. They don't seem to appreciate that we actually don't have the workforce to do it. Especially since they want to retrofit properties for energy effecency etc.

What I suspect will happen is that rent controls will not be introduced certainly not on new builds. I think the most rational solution is to give a tax credit to tenants. This would only be given to those not receiving any support for rent payments eg non hap tenants, RAS, RA etc.

Perhaps a way to increase supply in the short term is to identify why landlords are leaving the market and also incentivise those with second properties currently lying vacant.

I specifically use the word incentivise rather than force.

Personally I can't see how this is going to be solved in the short to medium term unless we review our housing strategy.
 
moneymakeover said:
Increase tax relief for both tenants

And landlords
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As a landlord myself I would be all on for some form of tax relief, however I can't see it happening personally. The general public have the perception that being a landlord is money for old rope. What they fail to realise is that the majority are just everyday working people holding down normal 9 to 5 jobs.

I am writing this while on my lunch at my desk in my office job!
 
The Horseman said:
As a landlord myself I would be all on for some form of tax relief, however I can't see it happening personally. The general public have the perception that being a landlord is money for old rope. What they fail to realise is that the majority are just everyday working people holding down normal 9 to 5 jobs. I am writing this while on my lunch at my desk in my office job!
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It seemed to me that the aim with FG was to encourage REITS \ commercial landlord operations rather than the likes of yourselves.
 
odyssey06 said:
It seemed to me that the aim with FG was to encourage REITS \ commercial landlord operations rather than the likes of yourselves.
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I would agree with you but they fail to realise that if the majority of supply is controlled by a minority of suppliers then to a large degree they can control price.

To be honest with the majority of landlords I would be in contact with are seriously contemplating getting out. If a rent freeze is introduced and the proposed reduction in rent if your property is not energy effecient I think will be enough to result in another exodus of landlords from the market.

I am almost there myself, if this continues I will just let my relatives live there.

International expierence indicates that rent freeze's dont work, expecting landlords to invest in upgrading property where they can't get a return on investment is crazy. The market will react accordingly, the Govt can't control the market no matter how it try's.

What is bizarre is at a time when landlords should be encouraged into and stay in the sector the Govt is making it more and more an unattractive sector to be in.

To be honest I just can't understand their logic other than being populist with the public.
 
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The Horseman said:
I would agree with you but they fail to realise that if the majority of supply is controlled by a minority of suppliers then to a large degree they can control price.
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Form their perspective, that means even more imperative for rent controls :)
Control control control.

It's bonkers, at the same time they are ratcheting up the requirements \ standards when are in the midst of an unprecedented shortage - and if they don't think there's an unprecedented shortage, why are they bringing in a rent freeze!

Looking at the standards they are demanding, the protections for tenants, the difficulties for landlords in dealing with tenants in arrears etc only a commercial operation could deal with that \ absorb it and operate within the 4% increase.
 
odyssey06 said:
Form their perspective, that means even more imperative for rent controls :)
Control control control.

It's bonkers, at the same time they are ratcheting up the requirements \ standards when are in the midst of an unprecedented shortage - and if they don't think there's an unprecedented shortage, why are they bringing in a rent freeze!

Looking at the standards they are demanding, the protections for tenants, the difficulties for landlords in dealing with tenants in arrears etc only a commercial operation could deal with that \ absorb it and operate within the 4% increase.
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I am not sure if control will work, at the moment the REITS/Cuckoo funds are by and large cash buyers so they don't necessarily need rent if the can still get capital appreciation. So if rent controls are put in place and running costs increase (eg wages, insurance etc) they could quite quickly end up losing money by renting out properties.

I agree it is bonkers at a time of shortage and I expect no matter which party(s) get into power they will then come back to the public and say they can't freeze rents. I suspect they will just offer tax credits to tenants which in a way is similar to a rent freeze if the tax credit is equivalent to one months rent. As rent increases then the tax credit will increase.

I would tend to agree with Fianna Fail about the unconstitutionality of this action, Fianna Gael have to update the Rent Pressure Zones legislation every couple of years as they know they can't make it primary legislation otherwise they would have.
 
The Horseman said:
I am not sure if control will work, at the moment the REITS/Cuckoo funds are by and large cash buyers so they don't necessarily need rent if the can still get capital appreciation. So if rent controls are put in place and running costs increase (eg wages, insurance etc) they could quite quickly end up losing money by renting out properties.
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I agree, but the view from Official Ireland (more than just FG) is that they don't like something that they are being hammered about in the press to be in the hands of multitudes of independent tiny producers. They want large commercial entities as they think they will be easier to control, and amenable to the levers they have at their disposal.

But I don't want to veer too much off topic so in terms of rents falling... if there was an emoji for *dubious face* I would use it.
 
odyssey06 said:
I agree, but the view from Official Ireland (more than just FG) is that they don't like something that they are being hammered about in the press to be in the hands of multitudes of independent tiny producers. They want large commercial entities as they think they will be easier to control, and amenable to the levers they have at their disposal.

But I don't want to veer too much off topic so in terms of rents falling... if there was an emoji for *dubious face* I would use it.
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Yeah I don't think rents are falling nationally there certainly are certain pockets that will fall and rise I suppose we will wait and see what the govt do and the market will react accordingly.

Personally I don't see this being resolved anytime soon unless the state builds themselves and I don't see that happening.
 
Sarenco said:
"What rent controls do – and we have already seen this with RPZs – is they turn the market into one of insiders and outsiders. Before RPZs, those with existing tenancies were enjoying smaller increases as well as none of the hassle of having to move. This gap between ‘stayers’ and ‘movers’ grew far worse with RPZs, as seen in the dramatic increase in lease length: even if it doesn’t suit you as much any more, once you have a place, you keep it.
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It also encourages inefficient use of the housing stock. If you're at a rent 30% below market value you might stay put even when a housemate leaves, your partner leaves, your child moves out, etc.

This means less people in the same number of houses - so more upward pressure on rents!
 
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