"Rents are at a record high – so why are private landlords selling up?"

Thread has gone somewhat offtrack in the last few posts. At a minimum:
1. Property tax must be made an allowable expense.

2. PRSI and the USC to be dropped.
 
Nordkapp said:
Thread has gone somewhat offtrack in the last few posts. At a minimum:
1. Property tax must be made an allowable expense.

2. PRSI and the USC to be dropped.
Click to expand...
No it hasn't if you read the title. Taxation isn't the main reason why" landlords " are leaving despite record rents
 
Landlords are selling up because;
  1. Accidental Landlords have recovered their losses.
  2. Many of the people who bought investment properties 20 years ago are retiring and are selling up.
  3. They are just cashing in their gains.
  4. They are fearful that they will be unable to evict difficult tenants because, well, they know that it's just about impossible to do that.
  5. They fear that the next government will change the law so that their tenant cannot be evicted even if the landlord is selling their property.
  6. They just don't want the hassle anymore.
  7. A combination of the above.
 
Purple said:
Landlords are selling up because;
  1. Accidental Landlords have recovered their losses.
  2. Many of the people who bought investment properties 20 years ago are retiring and are selling up.
  3. They are just cashing in their gains.
  4. They are fearful that they will be unable to evict difficult tenants because, well, they know that it's just about impossible to do that.
  5. They fear that the next government will change the law so that their tenant cannot be evicted even if the landlord is selling their property.
  6. They just don't want the hassle anymore.
  7. A combination of the above.
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We finalised the sale of our 'investment property' last week.
Accidental landlords, sold for €1k less than what we paid for it in 2007, tenants moved out last November, and we were afraid to rent again as we felt we'd have trouble getting the house back to sell in the future.
We had great tenants, no hassle, but the rewards were not there for the risks involved, especially after taxes were paid.
 
Mucker Man said:
We finalised the sale of our 'investment property' last week.
Accidental landlords, sold for €1k less than what we paid for it in 2007, tenants moved out last November, and we were afraid to rent again as we felt we'd have trouble getting the house back to sell in the future.
We had great tenants, no hassle, but the rewards were not there for the risks involved, especially after taxes were paid.
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was that the main/only reason for selling? Did you mind being accidental landlords? Would you have kept it for a pension purpose?

If someone asked you what do we need to do to keep you in the rental sector, would taxation have been an answer together with an ability to get vacant possession?
 
PebbleBeach2020 said:
was that the main/only reason for selling? Did you mind being accidental landlords? Would you have kept it for a pension purpose?

If someone asked you what do we need to do to keep you in the rental sector, would taxation have been an answer together with an ability to get vacant possession?
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We were mainly worried that we'd get a bad tenant who would wreck the house, or just stop paying rent, and we'd be relying on the RTB to help.
We rented it for 8 years and it only washed it's face for 2 of those, so we were happy to exit the market.
In terms of pension, I think there are better opportunities out there for investment, where the government isn't constantly meddling.

Vacant possession is a big issue for other similar landlords I have spoken to.

We had no choice really about being an accidental landlord, the house value dropped by 60% and I was made redundant, so we moved for work.
 
PebbleBeach2020 said:
Let's say every landlord sells every rented property to an owner occupier. Where do all the renter's go then?

On a smaller scale, say there's 600,000 renters across 200,000 properties. Say 50,000 properties are sold. Now there's 600,000 renters but only 150,000 properties. Do you see the problem now?
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I see their is a housing problem.
But still feel that private landord issue is a red herring.
In your eg 200k properties 600k renters shortfall of 400k properties.
If 50k private landlords leave the market surely the hses will be purhased by the renters/state or institutional landlords and will be still accommodating 50k previous renters.
Thus just rearranging who actually owns the properties. With no net change.
In shortage of 400k people.
 
Cavanbhoy said:
I see their is a housing problem.
But still feel that private landord issue is a red herring.
In your eg 200k properties 600k renters shortfall of 400k properties.
If 50k private landlords leave the market surely the hses will be purhased by the renters/state or institutional landlords and will be still accommodating 50k previous renters.
Thus just rearranging who actually owns the properties. With no net change.
In shortage of 400k people.
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Lots of renters house share with strangers, often with 3, 4 or more occupying the one place. Fewer owner occupiers do. So the more ex-rented homes are bought by ex-renter owner occupiers, the fewer people overall will be accommodated without an increase in supply.
 
Cavanbhoy said:
I see their is a housing problem.
But still feel that private landord issue is a red herring.
In your eg 200k properties 600k renters shortfall of 400k properties.
If 50k private landlords leave the market surely the hses will be purhased by the renters/state or institutional landlords and will be still accommodating 50k previous renters.
Thus just rearranging who actually owns the properties. With no net change.
In shortage of 400k people.
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if that's the logic, perhaps you can explain why rents are going through the roof? Why there's the lowest supply/availability of rental property in the history of the state? What 25,000 landlords who have left the rental sector (RTB figures) since 2016 and yet the rental situation has gotten progressively worse every year since 2016??? By your logic, the 25,000 landlords who sold, it made no difference as the houses didn't disappear.

You logic isn't quite logical!
 
PebbleBeach2020 said:
if that's the logic, perhaps you can explain why rents are going through the roof? Why there's the lowest supply/availability of rental property in the history of the state? What 25,000 landlords who have left the rental sector (RTB figures) since 2016 and yet the rental situation has gotten progressively worse every year since 2016??? By your logic, the 25,000 landlords who sold, it made no difference as the houses didn't disappear.

You logic isn't quite logical!
Click to expand...
Would that not be down to the fact that the supply of new homes been built each year for rent/owner occupier is less than the demand.
 
PebbleBeach2020 said:
if that's the logic, perhaps you can explain why rents are going through the roof? Why there's the lowest supply/availability of rental property in the history of the state? What 25,000 landlords who have left the rental sector (RTB figures) since 2016 and yet the rental situation has gotten progressively worse every year since 2016??? By your logic, the 25,000 landlords who sold, it made no difference as the houses didn't disappear.

You logic isn't quite logical!
Click to expand...
Our population is growing faster than the supply of homes.

It's a problem of success. Unfortunately our Government did a really good job of handling Covid and keeping the economy going.

A good deep recession which causes large scale emigration and a proper pandemic, not that wishy-washy one we had recently, would sort it out.

That or we could accept that there's a down side to the upside.
 
Might also be a good idea for councils to do an audit of their properties. So many one person renters given houses and other property that far exceeds one person status. I wonder how many are doing cash deals on renting out rooms in this "fiddle"? I'm told it's happening.
 
noproblem said:
Might also be a good idea for councils to do an audit of their properties. So many one person renters given houses and other property that far exceeds one person status. I wonder how many are doing cash deals on renting out rooms in this "fiddle"? I'm told it's happening.
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The highest HAP recipients are also single so I would imagine theres a lot of undeclared cash changing hands.
 
noproblem said:
Might also be a good idea for councils to do an audit of their properties. So many one person renters given houses and other property that far exceeds one person status. I wonder how many are doing cash deals on renting out rooms in this "fiddle"? I'm told it's happening.
Click to expand...
They are perfectly entitled to avail of the rent a room scheme. I posted in another thread that this amounted to the monetising of the excessive allocation of State assets by the recipient of that asset and the core problem was that misallocation... but they aren't breaking the law.
 
Agree there is a steady movement of landlords out of the market, but the problem is more that there are no "new" landlords coming into the market. There are two kinds of landlord selling up - those who've rented properties who are "retiring" and wish to cash in on capital values, and secondly there are tactical landlords, the "accidental" landlord so often spoke of, who tactically let former PPRs when they couldn't sell due to negative equity, but are reaching a point where the value has recovered sufficiently to break even or profit by selling.

Can't remember what the exact figure for mortgage draw downs for 20 years ago was for buy-to-let, but it was a lot more than the 1% there is now.
Some of this also related to fact that compliance has changed greatly in past 20 years, particular tax compliance, which in the light of the end of 1990s incentives (which ensured landlords came into the tax net) has left landlords with far less to write off tax against.

[edit - actual % of mortgages now BTL is 1.4% compared to 19.9% in 2006]
 
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Don’t forget all the landlords who are selling now because of the “ hold for seven year and pay no capital gains tax“ deal for property purchased between 7 December 2011 and 31 December 2014.
This was subsequently reduced to hold for four years but I’m sure a lot of landlords were not aware it was reduced.
For me anyway the seven-year period has just completed and I am considering selling this particular property I bought seven years ago.
 
landlord said:
Don’t forget all the landlords who are selling now because of the “ hold for seven year and pay no capital gains tax“ deal for property purchased between 7 December 2011 and 31 December 2014.
This was subsequently reduced to hold for four years but I’m sure a lot of landlords were not aware it was reduced.
For me anyway the seven-year period has just completed and I am considering selling this particular property I bought seven years ago.
Click to expand...
what did you buy for and what will it sell for? to give an idea of the scale of the incentive to sell now.
 
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