Askaboutmoney has an anti-property investment bent

[Bronte]

The clear opinion is to sell

That’s not at all clear to me. AAM has an anti property investment bent. Cremegg said you’re getting 6.6 return, before tax, that will be higher now with market rent.

What type of property is it? Are yiu certain of the rent? How about asking an auctioneer to give you a valuation and a rental estimate before you go hiring a solicitor. What will you do with the money if you sell. Take stock, don’t jump. Currently I’m exceedingly pleased with my new market rent. And with my new property valuation after renovation. I’m not worried about tenants staying long term, I prefer it.

 

[ClubMan]

AAM has an anti landlord bent.

I think that comment is completely unwarranted. Most people who are suggesting the sale of the rental property are doing so based on the numbers and the potential/actual pitfalls of being a landlord in this climate, and the fact that overly concentrating one's net worth in a single asset class/geographic region (Irish residential property) is inadvisable for most people from a diversification/risk management point of view.

 

[Greenbook]

Currently I’m exceedingly pleased with my new market rent. And with my new property valuation after renovation. I’m not worried about tenants staying long term, I prefer it.

Until rents reduce for some reason or other, your costs go up and you can't get the tenants out.

 

[Greenbook]

I think that comment is completely unwarranted. Most people who are suggesting the sale of the rental property are doing so based on the numbers and the potential/actual pitfalls of being a landlord in this climate, and the fact that overly concentrating one's net worth in a single asset class/geographic region (Irish residential property) is inadvisable for most people from a diversification/risk management point of view.

That is 100% correct.

The clearest advice here came from Brendan Burgess. He is not a landlord and has no skin in the game. He is looking at it purely from an investment standpoint and concluded that it is a bad/very risky one.

 

[Bronte]

Until rents reduce for some reason or other, your costs go up and you can't get the tenants out.

I’m not seeing how rents can reduce, and I’d rather the tenants stay long term. I’ve zero reason to get them out since I’m in the landlord business!

 

[Greenbook]

I’m not seeing how rents can reduce, and I’d rather the tenants stay long term. I’ve zero reason to get them out since I’m in the landlord business!

Recession, number of houses built increases, birth rate is decreasing, immigration decreases, government intervention. There is no guarantee of ever increasing rents.

You may wish to exit, as you would any other investment, if it is no longer profitable or for business/investment reasons. You may not be able to do so.

 

[stormy]

AAM has an anti landlord bent.

Worth pointing out that the "anti-landlord bent" here comes from people who are landlords themselves.

Currently I’m exceedingly pleased with my new market rent.

Bronte, is in a statistical minority. The vast majority of tenancies predate 1 March 2026 - those landlords are mandated by the State to carry every cost at market rate while their rent can only rise by the lower of inflation or 2% (and with annual inflation measured over a 10/11-month window at that). Plenty of property owners will find themselves holding a liability as costs climb and the rent legally can't follow.

Any state that mandates that arrangement is telling you exactly how much regard it has for accommodation providers - and it's a fair guide to how this latest set of rules will probably end up working out for them.

 

[Fortune]

I’m not seeing how rents can reduce

Recession, people leave the country, supply exceeds demand.

 

[Greenbook]

Recession, people leave the country, supply exceeds demand.

Or rents get too high and the government mandates a 30% reduction in all rents while you are locked in to a 6 year/permanent lease with increasing costs.

I'm not saying it will happen, but something like that could happen. Look at what has happened since 2016. Did we ever think the 'temporary' rent controls would lead to where we are now.

 

[DannyBoyD]

I'm with @Bronte - maxing rent, currently buying another property for rent & managing AirBnB property.

Yes there are risks, but thats the case with all investments one way or another.

 

[ClubMan]

I'm with @Bronte - maxing rent, currently buying another property for rent & managing AirBnB property.

Yes there are risks, but thats the case with all investments one way or another.

But what % of your net worth is in Irish residential property?

 

[Greenbook]

Yes there are risks, but thats the case with all investments one way or another.

Yes, of course, but the ultimate risk is an 'investment' with increasing costs, decreasing income and you can't get out of it. That is the PRS.

Rents are shooting up at the moment. There must be a 20% increase this year. We saw what happened after the 20% increases prior to 2016 ie. ultimately the rules we hav enow. But it is even worse this time when you are locked in to a permanent/6 year tenancy in an asset which is pretty illiquid anyway.

And the narrative is that you are a gangster of some sort, so far game for all sorts of additional restrictions and criminal liabilities.

 

[stormy]

I'm with @Bronte - maxing rent, currently buying another property for rent & managing AirBnB property.

Again if you are maxing rent, you are statistically in the minority. No way around that.

We don't know if the op's apartment has planning permission for Airbnb. I would assume not. The market for the >21 days on Airbnb is limited.

Yes there are risks, but thats the case with all investments one way or another.

Is there a single other investment where the government legislated the investor / business to bear all costs at market rate but limited their revenue to grow at the lower 2% / contrived in inflation?

There is very unique risks to the PRS, which are additional to those of any other business/asset class.

 

[Greenbook]

Is there a single other investment where the government legislated the investor / business to bear all costs at market rate but limited their revenue to grow at the lower 2% / contrived in inflation?

Your increase on the rent is capped at 2% which is less than inflation and good luck getting a real increase at year 6. But your rent can fall much more than that. It is far from an attractive investment - increases are capped at less than inflation and but decreases are not capped at all. So a limited upside and an unlimited downside. You can't take the benefit of increases, but you are fully exposed to decreases.

Plus a tenant in situ sale guarantees you a loss on the capital side.

 

[Brendan Burgess]

Askaboutmoney is a discussion forum.

It is my opinion that residential property investment is not a good idea. That is my personal opinion.

Bronte, DannyBoyD and others think that property is a great investment.

That is the nature of such a discussion forum. Different views will be expressed.

But even if you consider property a good investment in itself, it might not be a suitable vehicle for someone who has only one property and no other liquid assets to use to contribute to a pension or pay for children's education.

 

[Bronte]

It is my opinion that residential property investment is not a good idea. That is my personal opinion.

Do you ever think that residential property is a good investment?

My understanding of your view is that people should invest in equities instead of being a landlord? I don't understand equities, but I understand being a landlord, I cannot invest in something I don't understand.

But even if you consider property a good investment in itself, it might not be a suitable vehicle for someone who has only one property and no other liquid assets to use to contribute to a pension or pay for children's education.

Agreed, that depending on the situation a particular property investment might not be a good idea.

My experience in Ireland is that many people have purchased a property in Dublin to house children while they go to college. They have then let the other rooms tax free to other students, and sometimes to siblings working who have finished college. No tax is being paid and the property has enjoyed capital increases. And the parents have saved themselves the costly Dublin university rents. Rent that comes out of 50% taxed income. They also, generally, buy a property close to the university.

Don't disagree that contributing to a pension is a good idea.

There is a new question on Landlords following on from a) RPZ and b) the rules since March. We don't know the full impact of that yet.

@Greenbook, a landlord, thinks it's all doom and gloom, whereas I do not. We cannot right now prove either of us right ! I believe long time landlord @cremeegg remains a landlord and is happy with the landlord business.

 

[ClubMan]

I don't understand equities, but I understand being a landlord, I cannot invest in something I don't understand.

Don't disagree that contributing to a pension is a good idea.

Do you have a pension?
Is it also only invested in property so that you avoid equities?

I never understood this "I don't understand equities" line. They're just a share in a company - or many companies and possibly other assets when it comes to passive index trackers or ETFs.

 

[Protocol]

I don't understand equities

What is difficult to understand?

It is a share in a company, that is traded on a stock exchange.

Like property, the value may go up or down.

The company may pay a dividend income to shareholders.

Where shares differ from property is

(1) they are a much more liquid asset
(2) typically, you can't borrow to buy shares, whereas landlords often borrow, and so landlords can amplify their return due to leverage

 

[Protocol]

My experience in Ireland is that many people have purchased a property in Dublin to house children while they go to college.

I would dispute the word "many" here. I suggest less than 10% of students are in this position.

 

[Bronte]

Do you have a pension?

Yes. .

Yes I know that equities are shares in a company and I understand what shares are. I have been intenesly risk assessed by my bank, I'm so risk adverse they could not advise me to invest in anything. Ironically in the past Burgess considers me to be a risky investor in property. Can't remember when now, but a long time ago. (and nothing wrong with him thinking that of me, I just don't see it myself !)

I know he invests in shares, he's mentioned it and is knowledgable. Knows what he's doing and seems to make money from it. Well I assume he does !! And I think I'm a good property investor. Judging by rents achieved, properties bought and sold and capital accumulated.

Probably I have a problem with shares, I think they are the same as betting on a horse.