What does the new Government have in store for the rental market?

Sarenco

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RTE are reporting that the draft Programme for Government provides that -

• The moratorium on evictions brought in during the Covid-19 crisis will be extended.
• Security for rental tenants will be increased, while longer lease periods for rental properties will be introduced.
• There will also be increased protection for rental deposits.
• The HAP (Housing Assistance Payment) system will be reduced, and replaced with low-cost housing.

Can't see anything there to encourage anybody to stay in the residential letting business…:(
 

NoRegretsCoyote

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• There will also be increased protection for rental deposits.
This in in principle a good thing. But it will not be cheap. Will the RTB be equipped with a treasury arm to manage and administer deposits? Risk, compliance, audit, IT.......this kind of thing runs to millions. Who would pay?

• The HAP (Housing Assistance Payment) system will be reduced, and replaced with low-cost housing.
The only way to do this is for the state to up its (already-large) purchases of private housing to convert it into social housing.

This I guess makes sense when interest rates are super low. But the nice thing about HAP to the state is that the landlords bear the risk, and use can be ramped up and down in line with demand. As we've seen local authorities are not the most efficient managers of their own housing stock. AHBs probably a bit better.
 

Bronte

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RTE are reporting that the draft Programme for Government provides that -

• The moratorium on evictions brought in during the Covid-19 crisis will be extended.
• Security for rental tenants will be increased, while longer lease periods for rental properties will be introduced.
• There will also be increased protection for rental deposits.
• The HAP (Housing Assistance Payment) system will be reduced, and replaced with low-cost housing.

Can't see anything there to encourage anybody to stay in the residential letting business…:(
.
How are they going to pay for low cost housing. Does this mean basically giving people free home ownership.
 

collieb

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This in in principle a good thing. But it will not be cheap. Will the RTB be equipped with a treasury arm to manage and administer deposits? Risk, compliance, audit, IT.......this kind of thing runs to millions. Who would pay?
Here in Belgium, the security deposit has to be lodged into a joint account and can only be released with signature of both parties. While it gives more security to the tenant to know that landlord cannot simply 'take' the deposit, in practice it is still weighted in favour of landlord since it is usually the tenant that is in more of a hurry and therefore landlord has leverage. The amount to be deducted is based on a report by an assessor (paid for by both parties) which is checked against similar report done at start of lease. Assessor then uses prices and norms set by government to arive at a cost to be deducted, which shopuld be agreed jointly by tentant and landlord. Very complicated, very bureaucratic, and mainly benefits the assessor.
 
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NoRegretsCoyote

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Here in Belgium, the security deposit has to be lodged into a joint account and can only be released with signature of both parties. While it gives more security to the tenant to know that landlord cannot simply 'take' the deposit, in practice it is still weighted in favour of landlord since it is usually the tenant that is in more of a hurry and therefore landlord has leverage. The amount to be deducted is based on a report by an assessor (paid for by both parties) which is checked against similar report done at start of lease. Assessor then uses prices and norms set by government to arive at a cost to be deducted, which shopuld be agreed jointly by tentant and landlord. Very complicated, very bureaucratic, and mainly benefits the assessor.
This is the best system of course.

There is the cost of assessment of course. Even if landlord is obliged to pay some of the cost will be borne by the tenant.

Banks will also have to be incentivised to offer this kind of escrow account product. Otherwise they would very likely charge fees.
 

collieb

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This is the best system of course.

There is the cost of assessment of course. Even if landlord is obliged to pay some of the cost will be borne by the tenant.

Banks will also have to be incentivised to offer this kind of escrow account product. Otherwise they would very likely charge fees.
Banks here will also give guarantees for security deposit. But of course depends on credit rating, and comes with a nice fee. very popular with amount of ex-pats working for institutions and big MNCs.
 

Bronte

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Banks here will also give guarantees for security deposit. But of course depends on credit rating, and comes with a nice fee. very popular with amount of ex-pats working for institutions and big MNCs.
How much does it cost. And also how much does the assessor charge for the reports and who pays for that.
 

collieb

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How much does it cost. And also how much does the assessor charge for the reports and who pays for that.
No idea of the cost for the guarantee to be honest, but consists of set up fee and maintenance fee. all the big banks offer them - ING, KBC etc. Here's some info on ING website https://www.ing.be/en/business/lending/bank-guarantees/bank-guarantees.

For the asessor, you're looking at €300 roughly at start of lease and again at lease end, to be split 50/50 between tenant and landlord. The idea is you agree on the expert, but in practice the tenant often agrees to use the usual assessor of the landlord. But in theory, tenant has right to insist on his/her own assessor. The assessor draws up an 'etat du liu' which is an exact description of everything in the property, all defects etc. Uusally properties are rented free of furniture. The lease is usually 3 yeares, and renew automtaically unless cancelld. tenant must pay penalty of 1 months rent if cancelled in 3rd year, 2 months in second year, and 3 in first. very difficult for landlord to evict during lease and if poroperty is sold during the lease, it must be sold with the tean in situ.
 

NoRegretsCoyote

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Here is what the Programme for Government says:

● Develop a cost rental model for the delivery of housing that creates affordability for tenants
and a sustainable model for the construction and management of homes. In doing this, we
will be informed by international experience of the delivery of cost rental, such as the
‘Vienna Model’ and others.
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● Examine the creation of a system of holding rental deposits informed by international
experience.
● We will reduce our reliance on the use of HAP for new social housing solutions as the supply
of social and public housing increases.
● Mandate and resource the Residential Tenancies Board (RTB) to hear dispute resolution
cases where deposits are concerned so that the tenant can have their deposit returned to
allow them secure another property and to allow for swift resolution of disputes between
landlords and tenants.
● Continue the RTB change programme, transforming it into an independent and strong
regulator for tenants and landlords.
● Strengthen the regulatory and enforcement mechanisms with regard to short-term lettings.
● Support the adequate supply of rental accommodation by ensuring equity and fairness for
landlords and tenants.
● Reform the Fair Deal scheme to incentivise renting out vacant properties.
● Improve the security of tenure for tenants, through legislating for tenancies of indefinite
duration, increasing RTB inspections and enforcement and examining incentives for
long-term leasing.
● Instruct local authorities as part of their housing strategies to undertake and publish a rental
needs assessment.
● Examine the measures that may be needed to support tenants, as a result of COVID-19
informed by the forthcoming research from the Economic and Social Research Institute
(ESRI).
● Extend the moratorium on the termination of tenancies, in line with public health advice, if
the requirements of Section 4 of the Emergency Measures in the Public Interest (Covid-19)
Act 2020 are met.
 

cremeegg

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● Develop a cost rental model for the delivery of housing that creates affordability for tenants
and a sustainable model for the construction and management of homes. In doing this, we
will be informed by international experience of the delivery of cost rental, such as the
‘Vienna Model’ and others.


A cost rental model, which I understand to mean a system where the local authority or other housing body rents property at a cost to the tenant which just covers the housing body's costs, is an excellent idea. This would be considerably more expensive for the tenant than the current local authority housing model which does not recover its costs from the tenant.


● Examine the creation of a system of holding rental deposits informed by international
experience.


It would seem inevitable that this will come. In my opinion the costs involved are not justified, but the perceived sense of unfairness, where landlords can hold a tenants deposit without cause will mean that something on these lines will come in at some point. Everyone will be subject to bureaucratic delay, instead of some people subject to bad faith delay.

● We will reduce our reliance on the use of HAP for new social housing solutions as the supply
of social and public housing increases.


This is ridiculous. Talk about the cart before the horse.

● Mandate and resource the Residential Tenancies Board (RTB) to hear dispute resolution
cases where deposits are concerned so that the tenant can have their deposit returned to
allow them secure another property and to allow for swift resolution of disputes between
landlords and tenants.


Swift indeed.

● Continue the RTB change programme, transforming it into an independent and strong
regulator for tenants and landlords.


Sounds good

● Strengthen the regulatory and enforcement mechanisms with regard to short-term lettings.

So no more tourists, great for the economy. The short term lettings market should certainly be regulated, and regulations should certainly be enforced, but the current regulations are overly restrictive.

● Support the adequate supply of rental accommodation by ensuring equity and fairness for
landlords and tenants.


Lots of people support Mayo football. That doesn't win All Irelands

● Reform the Fair Deal scheme to incentivise renting out vacant properties.

This is a good idea and long overdue. Unlike many of the other ideas, this one could be implemented fairly easily.

● Improve the security of tenure for tenants, through legislating for tenancies of indefinite
duration, increasing RTB inspections and enforcement and examining incentives for
long-term leasing.


Additional options for tenants and landlords are a great idea, I hope any regulations in this area are well drafted.

● Instruct local authorities as part of their housing strategies to undertake and publish a rental
needs assessment.


I am all in favour of that.

● Examine the measures that may be needed to support tenants, as a result of COVID-19
informed by the forthcoming research from the Economic and Social Research Institute
(ESRI).


I'm not clear what is involved here, but supporting tenants should not have to be at the expense of the landlord.

● Extend the moratorium on the termination of tenancies, in line with public health advice, if
the requirements of Section 4 of the Emergency Measures in the Public Interest (Covid-19)
Act 2020 are met.


Extending the moratorium for as long as it is needed is understandable, however it will make property owners even more reluctant to put property into the rental market.
 
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