Landlords and temporary Rent reduction

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Bluebird

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Is there a way for landlords to help out tenants who are struggling at this time by giving them a temporary rent reduction?
Without then being stuck way below market value in a rent pressure zone when all of this eventually ends.

Any ideas or advice appreciated.
 
Bluebird said:
Is there a way for landlords to help out tenants who are struggling at this time by giving them a temporary rent reduction?
Without then being stuck way below market value in a rent pressure zone when all of this eventually ends.

Any ideas or advice appreciated.
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Good question because of where we are and yes, I do feel the tenant needs to start having a chat with their property owner about what you're suggesting if they find themselves in trouble.The wheel is turning and there could possibly be 350,000 people out of a job by the weekend. This time there won't be tenants lining up to rent the properties.
 
I just hope that this isnt abused if introduced yes people will need assistance if they are laid off and should be helped.
But as a landlord I would need proof of the change of circumstances.
Cant see that going down well.....
 
noproblem said:
Good question because of where we are and yes, I do feel the tenant needs to start having a chat with their property owner about what you're suggesting if they find themselves in trouble.The wheel is turning and there could possibly be 350,000 people out of a job by the weekend. This time there won't be tenants lining up to rent the properties.
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And where do you think these people will go? Even 10% of 350000 is 35,000 people looking for new accommodation would create demand.
 
Paul O Mahoney said:
And where do you think these people will go? Even 10% of 350000 is 35,000 people looking for new accommodation would create demand.
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To tell you the truth I think they'll stay where they are, won't be able to pay and create a situation whereby the property owner will have to spend a hell of a lot to do something about it. Even then, they still have to get housed by ? Will the situation be abused? You can bet your bottom dollar it will be.
 
I'd be more than willing to not take rent from my tenants until this issue gets resolved. However, I have a mortgage that needs to be repaid, so, without receiving the rent, I wouldn't be in a position to do this until I got confirmation that my mortgage payments wouldn't be taken at the start of the month.

There's a sequence here that needs to happen i.e. 1. Bank announces that no mortgage payments would be taken and, 2. I would then inform my tenants that they don't need to pay any rent. This would be repeated when the crisis is over. It should be simple enough for banks to write to mortgage holders to let them know that no payments will taken for x months.

There might be some landlords who get mortgage payments frozen but don't pass it on to the tenants. In cases like this, there should be some way for tenants to "report" these to RTB.
 
My problem with this is that the term frozen suggests that the payments are being deferred rather than written off. I have tenants who live on a week to week basis so their expectation would probably be that they would never have to pay the rent back that they don't pay now. I understand their plight and they can't starve but it is not my role to provide social housing. For the moment I will continue to get paid but my husband won't so it's not all roses for landlords either.
 
Hi George12. Yep, that's my expectations i.e. the bank wouldn't write off these monthly repayments, but rather defer them to the end of the mortgage. It's trickier when it comes to the tenants though. Say I have a tenant who hasn't been laid off, I would just expect things to continue as normal i.e. I get paid the rent, and I then pay my mortgage.
On the other hand, if I have a tenant who works for a company where they have been temporarily laid off, I would be willing to not charge them rent as long as the bank doesn't expect me to pay the mortgage. I know this can't continue indefinitely and a time will come when the bank can no longer allow payment not to be made and this is where it gets tricky.
 
It's a tricky one, rent reductions or moratoriums would cause knock-on effects. Dublin City Council have already warned they would quickly run out of money of they were forced to halt collections.
 
And unfortunately the tenant will probably not be around Ger1966 when you have to pay the missed payments at the end of the mortgage term.....anyway best just wait to see what is announced before we panic
 
Before the coronavirus outbreak, if a tenant lost their job they could get their rent paid through the HAP scheme. This is still the case now so I don't think it's fair that the landlord should be hit in the pocket too.
The government should make it faster for HAP applications to be processed, that way the tenant isn't liable for the rent and the landlord will still be able to pay his mortgage. It's no good the banks giving a 3 month mortgage holiday when interest is still accruing on the loan. Also, regardless of what the media or the banks say about affecting the landlord's credit rating, it will still be a black mark against him/her if they ever want to remortgage or borrow in the future. HAP is there for a reason, so the government should use it instead of making it complicated for the landlord and tenant.

Since all the recent job loses and the obvious delay in processing job seeker applications, the government has asked affected employers to pay the employee the equivalent of jobseekers allowance and then claim it back from the government at a later date. They could introduce that for tenants too while the HAP application is going through. So while the tenant is waiting for HAP, the landlords would waiver the rent the tenant owes them, knowing that they can claim it back from the government.
 
Stephen Brennan said:
Before the coronavirus outbreak, if a tenant lost their job they could get their rent paid through the HAP scheme. This is still the case now so I don't think it's fair that the landlord should be hit in the pocket too.
The government should make it faster for HAP applications to be processed, that way the tenant isn't liable for the rent and the landlord will still be able to pay his mortgage. It's no good the banks giving a 3 month mortgage holiday when interest is still accruing on the loan. Also, regardless of what the media or the banks say about affecting the landlord's credit rating, it will still be a black mark against him/her if they ever want to remortgage or borrow in the future. HAP is there for a reason, so the government should use it instead of making it complicated for the landlord and tenant.

Since all the recent job loses and the obvious delay in processing job seeker applications, the government has asked affected employers to pay the employee the equivalent of jobseekers allowance and then claim it back from the government at a later date. They could introduce that for tenants too while the HAP application is going through. So while the tenant is waiting for HAP, the landlords would waiver the rent the tenant owes them, knowing that they can claim it back from the government.
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That would be the ideal situation but HAP is administered by councils and can't see them turning applications around in a hurry.

If the government were to allow the capital payments for those months to be tax deductible that might soften the blow a bit but I can't see why landlords should be out of pocket in this.
 
And the tenant still has to make a payment themselves to HAP in order for the landlord to be paid. Currently if they dont pay their contribution the payment to the landlord is stopped. It's hard to know what to do for the best. Maybe council continues to issue the HAP payment even if the tenant cant pay?
 
I don't know anybody who was not affected somewhat by the Covid-19 situation. Is there a legitimate reason why landlords should not be affected?
 
Leper, Landlords will be affected. There are many people that have investment properties and are therefore considered landlords but also have regular jobs to meet the payments. Remember, that many people who bought investment properties in the boom years ( 2005 - 2008 approx) are still in negative equity (Balbriggan for example), although you won't read that in the media.
It's about protecting people as much as possible. I agree that tenants should have help with the rent paid if they lose their jobs but it doesn't have to be at the detriment of the landlord.

Paul, I agree with you about the capital payments being tax-deductible, that would certainly help.
Leo was on last night about everyone being in it together. If that's the case, the councils will have to step up to the plate regarding HAP as well as everyone else. I know landlords aren't popular but the state needs them too.
 
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Am I right in thinking if I take a payment break of 3 months on 2k per month with 20 years left on mortgage and a rate of 5% instead of paying back 6k I will be paying back more like 16k. I.e. 6k over 20 years at 5%.
 
Chipmunk said:
Am I right in thinking if I take a payment break of 3 months on 2k per month with 20 years left on mortgage and a rate of 5% instead of paying back 6k I will be paying back more like 16k. I.e. 6k over 20 years at 5%.
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I think your logic is right...you will pay back more. Landlords will get no benefit from this. If the take a break they will pay everything back overtime with interest. But remember...we're all in this together.
 
Geri, I agree. Yes, it's an emergency situation so the HAP payment should still be paid regardless of whether the tenant can make their contribution.
 
Stephen,
Or maybe the landlord gets the hap payment less the tenant contribution if they are not paying it. This way no one looses out completely.
 
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