National rents 31% higher than their 2008 peak

Discussion in 'Property investment and tenants' rights' started by newirishman, 10 Feb 2019.

  1. newirishman

    newirishman Frequent Poster

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    753
    I've got more than a few employees asking for 20%+ pay rises over the last few years as LL hiked rents quite drastically.
    There is a couple of threads even here in AAM where Landlords talk about "getting out of the game" as it "isn't worth" the hassle.

    Well, the latest daft.ie reports seems to agree with the tenants.
    I would like to hear from landlords who say "it isn't worth" how that could be, given that headline. Genuinely curious.

    https://www.daft.ie/report/ronan-lyons-2018q4-rental
     
  2. RETIRED2017

    RETIRED2017 Frequent Poster

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    640
    Last edited: 10 Feb 2019
    I am a landlord I have taken in new tenants who were moving Because they knew the existing landlord was collecting rent and not paying Bank, It was also nearer to there work ,I actually went and collected mother and children while husband and his friends moved there stuff in to house,

    I knew on the grapevine there existing landlord was not good at given back all of the deposit so when I went to collect mother and kids I kind of had a look to see how tidy they were leaving existing apartment , The landlords wife was there you could see the place was well looked after,


    Long story short story there landlord tried to keep most of there deposit same landlord was collecting rent and making no repayments for as long as he could get away with it for,

    There is supposed to be 11000 tenants homes where the landlords are not meeting mortgage repayments ,

    I hope the 20% extra you are paying them will long term lead to them being able to buy there own home,
    I also hope we come up with a system where your employees can own there own home close to where the work,


    The tenants I have are a lot like the kind of people you employ good people who get up in the morning and go to work ,to be honest I would rather take a bit less from them knowing it is going to be looked after,
    I think some Landlords have a different Business Model where they are providing a service which the Government used to be doing and not expecting to get paid in all cases,
    I take a big Deposit up front tenants know they will always get it back,

    In fact I would Welcome a system like they have in Austria where a large deposi t is put in an account for tenants and landlord all interest is credited to tenants,
     
    Last edited: 10 Feb 2019
  3. dub_nerd

    dub_nerd Frequent Poster

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    I am not a landlord, however it's not that difficult to reconcile the facts. At the height of the last property boom, rental yields were tiny because property prices had gone so crazy. People bought properties with yields as low as 1 or 2% because they were only interested in making a killing on capital appreciation. We know how that ended up.

    If yields had only gone up 20 or 30% the situation for landlords would still be dire. In fact, on a €200k apartment you can probably charge €1,600+ per month, giving a gross yield of 10%. The landlords' claim is that because of various non-deductible expenses, followed by income tax on the rent, they can only make a low single-digit net return. This must also compensate them for void periods, and the risk of property damage and overholding, in which cases they argue that the law is on the side of the tenant.

    I have some sympathy, but not a great deal. It's a business -- you factor in your risk and returns, and take your chances. Compared to risk-free deposit returns of a small fraction of a percent, it is considerably better.

    However, to say that landlords must automatically be making a killing because rents are high is a fallacy. Also, because of the much greater risks of owning a single property vs. averaging across many, the classic Irish "accidental landlord" may well be right that it's not worth it.
     
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  4. Feemar5

    Feemar5 Frequent Poster

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    I know quite a few accidental landlords and most of them want to get out - its not all about money , its the hassle and to be honest some of them were never suited to be landlords. They didn't factor in the time it takes dealing with small repairs, checking rents and doing paperwork and making revenue returns. Most have had good experience with tenants and still want out. Once their property prices come back up to what they paid - they will be gone. Unfortunately in rural Ireland prices both for property and rent are not a fraction of what applies in the cities.
     
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  5. NoRegretsCoyote

    NoRegretsCoyote Frequent Poster

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    153
    There are a few issues:
    • Regulation in recent years has shifted the balance of rights from landlord to tenant. This may be good or bad (depends on your opinion) but putting caps on rents, making it harder to serve termination of tenancy, etc, is not going to make life more appealing to landlords
    • Many landlords were in negative equity until about 2016. Negative equity is nearly all gone for those who serviced their mortgages, so many can call it quits if they need
    • The CGT exemption for landlords who bought in 2012 and held for seven years is now coming into play. Anyone who bought in 2012 or 2013 is sitting on a capital gain of 40% at least and they can get out now with no CGT bill.
    • REITs are just better at being landlords than small-time punters and many new developments are build-to-rent. They get finance, maintenance, etc at scale and the tax treatment is better too. Tenants like them too as they are much more predictable to deal with.
     
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