If you check the land commission system is older than the state check and correct yourself,
And???
But it's not, instead it's a money pit. Doesn't that suggest something?
And for the same economics to apply to homes built now, tenants in 50-60 years time will have to pay €150,000 pa. How likely is that.
Who will pay the property management company's bills?
The only reason I used the land commission is to take a look at how it would work out if you went away from renting to an annuity system ,Always thought that was a major lacuna in my knowledge of Irish history, do you know of any book on the Land Commission
I think tom has forgotten the 2,4% taken from the pension pot by FF?FG?LAB, and given for the most part to the usual suspects,Always thought that was a major lacuna in my knowledge of Irish history, do you know of any book on the Land Commission
Yes, that the State has been historically bad at managing its housing stock. That is why I am proposing that property managers manage the housing stock.
I The State builds a two bed house in Dublin 6 for €250k on land that it owns. This €250k is capital expenditure and goes onto national debt.
The State requests property managers to submit tenders to take control of the property for the purposes of letting out. There are some conditions (lets keep it as simple as possible, this is merely a concept)
1. As the State is in no hurry to redeem the €250k outlay, it spreads repayments on the national debt for 100yrs. It looks for a fee of €2,500pa from the property manager.
2. The property management must produce an initial outlay to furnish the property to a specific standard providing all mod cons - typical outlay, say, €10,000 with €1,000 extra a year.
3. The property manager must hold a contingency fund equivalent to 20% of the rent charged. This is to be used for necessary re-decoration, repairs, replacements. These costs can be written off against tax bill.
4. The property management sets a fixed rental fee, reviewable every two years with limited increases no more than prevailing inflation rate.
Five property managers submit tenders to the State to take control of the property for the purposes of letting out. All five meet the terms of the tender. The only difference between them is the final rent to be charged.
The property manager who offers the most competitive price of the rent wins the tender.
So how much?
€2,500 State fee
€10,000 initial outlay over 20yrs equates to €500 a year.
€1,000 additional
Im working it out at about €4,000pa or €333 a month.
To make it worthwhile, the property managers set their rental prices. One sets rent at €1,000pm, another €900pm, another €700pm, another €650pm another at €600pm.
The property manager who sets rent at €600pm wins the right to let the property.
Mr & Mrs low & middle income earners can now afford to rent a place of their own. Not only that, there is scope to save money for a house deposit should they wish to do so. Alternatively, they can stay where they are. They can start a family, go on holiday, buy health insurance.
A portion of any money not used by the property contingency fund to repair or replace fixtures and fittings goes toward reducing rent further. An incentive to look after the condition of the property is built in.
This is just a simple example, I expect there will be a thousand scenarios of what if's and but's.
The primary aim is to develop a concept that moves away from the system that exists today that drowns tenants with high rents and has landlords chasing maximum market prices.
I think the underlying problem is Landlords are paying USC and PRSI which they have not being paying in the past I think the level of tax is also a big factor
Wouldn't it just be easier for me the landlord to buy a property let it out and have no state involvement.
How is the property management company making money? Do they get the rent?
How much is the land costs for each property?
How does the state get it's money back?
And how is the property management company going to get 10K per property in the first place?
Do you not think that landlords like me are already excellent property managers?
So not actually a property management company at all, but a price fixing authority.You mean just carry on as we are? Tenants drowning in rent payments and landlords getting out of the sector because they cant profit from maximum market prices?
Did you not read the post? The property management that takes control of the property charges €600pm rent on the tenant.
A cursory glance at 2 bed house or apartment in D6 today is €2,000+.
So not actually a property management company at all, but a price fixing authority.
Swimming in delusion.
What authority is fixing the price?
It is the property managers competing with one another to provide rental accommodation that is setting the price.
Did you not read the post? The property management that takes control of the property charges €600pm rent on the tenant.
A cursory glance at 2 bed house or apartment in D6 today is €2,000+.
Not sure of your 52% v 62%, but if you do the numbers based on your actual rental profit (including full mortgage interest and tax-disallowed travel, capital-element repairs and local property tax), the % will be higher still.I paid 62% of my rental income in tax in 2017 (just finished compiling the numbers).
52% was income tax - (40%), PRSI (4%), USC (up to 8%)
Isn't this what you say here? Correct me if I'm wrong.
Did you not read the post? The property management that takes control of the property charges €600pm rent on the tenant.
A cursory glance at 2 bed house or apartment in D6 today is €2,000+.
Zero, the state has either bought the land or already owned the land. The property management has no cost to bear other than a €2,500pa fee back to the State.
Its called capital requirement. If you don't have the money then you cant invest.
.
So not actually a property management company at all, but a price fixing authority.
Swimming in delusion.
Not sure of your 52% v 62%, but if you do the numbers based on your actual rental profit (including full mortgage interest and tax-disallowed travel, capital-element repairs and local property tax), the % will be higher still.
It makes no sense neither in terms of common sense nor economics, and also reeks of the Soviet Union's idealistic year-zero mass housing schemes.Can you just imagine the nightmare of the state managing all of this.
If you are a landlord and have being following the news and reading the papers you would know well Airbnb is being tightened up ,Are they not also paying this on Airbnb income?
The government borrows millions or billions to get a house built for 250K.
I have to put in 10K of fixtures and fittings. I have to maintain the property.
Who in this scenario is the landlord? The property management company?
And tenants in Dublin are now getting a property worth 2K in rent for 600 Euro.
You know what, heck I'll become a tenant in Dublin for that 600 Euro myself and do something else to make money.
Can you just imagine the nightmare of the state managing all of this.
I nearly gave up on HAB myself and a lady in the payment office in Limerick had to beg me to stay in there as I was nearly at the end of the procedure.
Which reminds me I should put up the rents to keep the property value up to market value. And the tenant's won't care as the state will pay.
I'm convinced that HAP has driven up rents. Because I have never got so much rent.
Where did you get your figure of €600pm? What's wrong with €500pm? Or €400pm?Now you are getting it, except its not worth 2k, its worth €600pm.
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