Saucy Rent Rise - doesn't suit you, sir!

rediguana

I live by The Montrose, the address being Blackrock / Stillorgan Road. My lease is up soon and the landlord is trying to raise the rent by 13% on a two-bedroomed apartment.

I thought that rents were static / falling in Dublin, though I appreciate that there will be differences by area.

Anyway, I'll need to thrash it out with him at some stage. To be honest, I want an increase of 0%.

I need some stats / hard info to galvanise my arguments. In the current climate, should I tolerate a 13% increase in rent? I love the apartment, and would be sorry to move. But the rent is already a burden.

patrickolee

Rents have risen quite sharply over the last few months. Sorry.

rediguana

patrickolee wrote:

Rents have risen quite sharply over the last few months. Sorry.

Why is this? Am I not reading about houses that can't be sold? And demand slackening off generally?

Are they rising just to cover landlords' increased mortgage repayments?

patrickolee

I'm not a renter or a landlord, but from what I read it is because many people are nervous about buying and so are staying in the rented acc. This has put pressure on supply in the rental sector and resulted in fairly sharp price rises. The extra amount your landlord is asking for is not unheard of. You could always have a look around and see if you can get somewhere cheaper? That might put you in a stronger position for negotiation; if you are a good tenant he might be happy to sacrifice a little extra rent in order to keep you?

The_Conductor

Yes, is the simple answer- landlords expenses have increased markedly in the last year, and they are trying to recoup some of these by way of increased rent. That said- rents can only be increased in keeping with the increases in the area- so DAFT would possibly be a good port of call to see what the going rate in the area is.

Montrose D4 is a very desireable location- the problem is that there will always be people interested in it. If you have been a good tenant- you could make that point to the landlord, its far preferable to have a good tenant that you know, than strangers who might trash your place.

Good luck to you- I know 13% is a steep rise, its entirely possible that with increased difficulty in offloading investment properties- that they may re-enter the market again as rental properties- leading to a decrease in rents- but thats in the future, in Dublin anyhow.

S.

rediguana

patrickolee wrote:

I'm not a renter or a landlord, but from what I read it is because many people are nervous about buying and so are staying in the rented acc. This has put pressure on supply in the rental sector and resulted in fairly sharp price rises. The extra amount your landlord is asking for is not unheard of. You could always have a look around and see if you can get somewhere cheaper? That might put you in a stronger position for negotiation; if you are a good tenant he might be happy to sacrifice a little extra rent in order to keep you?

Makes sense, but still.

I can certainly get somewhere just as good for what I'm paying now (girlfriend is trawling through Daft beside me). But he'd lose the bones of a month if I moved out, which would basically be equivalent to the increase in rent (it was vacant for six weeks before we moved in; he'd need to clean it up and fix a few things, as well as fill it) if we moved out.

I'm going to truthfully tell him that if the rent rises, we're moving out. He hasn't had any trouble with us during our year.

patrickolee

I'd probably try to negotiate a little if I were you, rather than flatly telling him if he raises the rent you'll move out. What he will likely do is say, 'ok, cya'. If you offer him an extra 20-30 Euro he might go for it, he's got his token increase and saved face and you don't have to pay too much extra. Do your research (sounds like you're doing that already) beforehand and be clear in your own mind what level of increase (if any) is acceptable to you.

Good luck, let us know how you get on anyway

rediguana

I'd pay an extra E20-E30 tops.

Anyway, if anyone has any more useful titbits, anecdotes, or stats, please post.

What're average rents for the Stillorgan Rd., across from UCD?
What are rents increasing by in South Dublin?
Do landlords ever deviate from their freshly-printed new lease?
Is 13% a bit rich in these gloomy times?

SkepticOne

Don't know where patrickolee is getting his numbers from. Rents are coming down according to the latest daft report, the source of the only statistics we have. In real terms, rents are much lower than in 2002.

As with all statistics there will be some exceptions. I think in this case the landlord is hoping that the tenants will be bullied into accepting a rent rise in order to cover the landlords interest bill. Unfortunately for this landlord, there are a lot more rental units available as investors who were hitherto happy with capital appreciation and did not bother to rent out their properties now attempt to get some sort of return.

patrickolee

SkepticOne wrote:

Don't know where patrickolee is getting his numbers from.

I didn't give any numbers, apart from negotiation advice. I also did indicate that I have no direct experience in this, neither been a landlord nor tenant.

SkepticOne wrote:

In real terms, rents are much lower than in 2002.

Irrelevant to the OP. His landlord wants to increase his rent, that's a numerical increase. You can compare that to inflation if you like and give yourself a warm fuzzy feeling inside, but the landlord still wants more notes in his fat little fist. OPs job is to minimize the extra number he gets.

SkepticOne wrote:

Unfortunately for this landlord, there are a lot more rental units available as investors who were hitherto happy with capital appreciation and did not bother to rent out their properties now attempt to get some sort of return

Come on man, really... do you believe that?

edanto

Just for context, how long has the rent been at the current level? Just that my rent went up a similar amount at the start of the year, but it hadn't moved in the previous four.

It was a good time to negotiate - we've had new curtains, floor and a paint job in the last year, so if they really insist on the rise and you really want to stay, you might get them to improve the apt a bit.

A Random Walk

It has long been predicted that there would be a rent "crunch" in the event of a housing slowdown. Increased numbers of houses would be put up for sale lowering supply, while potential buyers would choose to rent rather than buy increasing demand. Both of these would raise the cost of rents and this seems to be where the market is at currently.

The good news is that the other predictions see rents dropping in the future as sellers reduce prices on homes for sale, as unoccupied properties are sold and as large numbers of foreign nationals choose to return home as work dries up.

SkepticOne

patrickolee wrote:

I didn't give any numbers, apart from negotiation advice. I also did indicate that I have no direct experience in this, neither been a landlord nor tenant.

On what basis, then, did you say that rents had been rising the past few months?

"Rents have risen quite sharply over the last few months. Sorry."

Where did this come from? How do you know it to be true?

I argued a while back that there would be an increase in rents as panicked investers removed their tennants in order to put their depreciating properties on the market and that, since this would lower supply, this would put rents up.

I also argued that this effect would be temporary. At some point either a given property would either be sold or, failing to sell, it would have to be put back on the rental market. If it is sold then either it is sold to an investor and rented out or sold to an owner occupier, ultimately freeing up a rental unit.

A net migration of people from owner occupier to rental accommodation does not have any effect on rents except in the transition period since this involves temporary empty properties.

It seems as if we have been through this temporary period of higher rents and the latest indicators suggest that rents have been coming down as predicted.

I think there's a lot of people brainlessly accepting the spin of vested interests as fact. I think the OP's landlord would be one of these people.

cast_iron

SkepticOne wrote:

Rents are coming down according to the latest daft report, the source of the only statistics we have.

Got a link to back that up?

From what I can see, rents have risen sharply over the last year due to people uncertain about buying and stying in rented accom instead.

SkepticOne

patrickolee wrote:

Irrelevant to the OP. His landlord wants to increase his rent, that's a numerical increase. You can compare that to inflation if you like and give yourself a warm fuzzy feeling inside, but the landlord still wants more notes in his fat little fist. OPs job is to minimize the extra number he gets.

How do you make that out? Surely if rents are not rising generally this is of interest to the OP negotiating with his landlord.

Come on man, really... do you believe that?

Yes I believe there are vast numbers of properties that the owners have not bothered renting out due to eay money from capital appreciation. Renting out would just have been hassle for peanuts compared to capital appreciation. Now with property prices, like rents, falling, owners of investment properties are forced to rent them out for whatever they can get.

Please see results of CSO census 2006 surveys for evidence of the empty properties. Please see last two Daft reports for evidince of falling rents (look at the numbers, though. As allways, ignore the spin).

I also believe that there will be a lot more people renting out spare rooms in an effort to pay mortgages at higher (though still historically still very low) interest rates.

SkepticOne

cast_iron wrote:

Got a link to back that up?

From what I can see, rents have risen sharply over the last year due to people uncertain about buying and stying in rented accom instead.

There have been some rises over the last year, but what I'm contending is the idea that rents have been rising the last few months. I don't believe patrickolee has any figures to back this up Indeed he has admitted such.

timamansio

Rents in Dublin have been increasing quite sharply this year. From the latest daft report:

"Rents have risen in both absolute and year-on-year terms each quarter since late 2004. Recently, the pace at which rents have been rising reached record speed. As shown in the last Daft Rental report, the first quarter of 2007 saw rent increases of 10.8% compared to the same period in 2006. In the second quarter this figure increased to 12.4%"

The report goes onto say that there has been some slackening in rents in Dublin City Centre but the OP is living near Montrose.

Full report is available here -> http://www.daft.ie/report/

cast_iron

SkepticOne wrote:

There have been some rises over the last year, but what I'm contending is the idea that rents have been rising the last few months. I don't believe patrickolee has any figures to back this up Indeed he has admitted such.

And I've asked you to back up your point about rents coming down

Edit: Thanks timamansio. That's what I suspected myself. And I thought I read the daft report backed me up on it too.

rediguana

I'm in a world of pain over this rent increase

Stats notwitstanding, an hour on Daft shows me there are superior properties to the one I'm living in for 80%-100% of the supposed new rent, in nice areas like Stepaside, Sandyford, Dundrum, Rathfarnham, Rathgar.

Somebody may well pay the increased rent in this place, but it won't be me.

cast_iron

rediguana wrote:

I'm in a world of pain over this rent increase

Stats notwitstanding, an hour on Daft shows me there are superior properties to the one I'm living in for 80%-100% of the supposed new rent, in nice areas like Stepaside, Sandyford, Dundrum, Rathfarnham, Rathgar.

Somebody may well pay the increased rent in this place, but it won't be me.

Then move. I think the landlord is well within his right to up the rent.

Donnybrook (close to 46A route) will always command higher rent than all those places you mentioned - that's why they are cheaper. It's no great conspiracy to screw you, more market forces in action.

You dont mention you found too much in Donnybrook at your current price on daft at the moment. So I assume there isn't, hence justified rent increase.

rediguana

cast_iron wrote:

Then move. I think the landlord is well within his right to up the rent.

Donnybrook (close to 46A route) will always command higher rent than all those places you mentioned - that's why they are cheaper. It's no great conspiracy to screw you, more market forces in action.

You dont mention you found too much in Donnybrook at your current price on daft at the moment. So I assume there isn't, hence justified rent increase.

I don't live in Donnybrook, the address is Blackrock-Stillorgan Road. It's Co. Dublin, across from UCD / Fosters Avenue. Close to the Montrose hotel.

But I take the point that supply-demand will dictate price. He may find that he has set his price too high though. I don't need to live in this location, I just need to have access to Dalkey-Sandymount-Tallaght, a large triangle. Lots of places will suffice. Maybe someone else will come along that will vindicate his decision to up the rent, but in that time he will likely have lost a large portion of what he had hoped to gain over the year.

Inertia is a powerful force, especially for me. Had the rent stayed the same, I would never have looked on Daft. Now that I have, I realise that I can get a significantly better deal than what's currently on the table.

cast_iron

rediguana wrote:

I don't live in Donnybrook, the address is Blackrock-Stillorgan Road. It's Co. Dublin, across from UCD / Fosters Avenue. Close to the Montrose hotel.

Well the Montrose is D4, as is UCD. Either way, you are close to the 46a route.

rediguana wrote:

but in that time he will likely have lost a large portion of what he had hoped to gain over the year.

That's a bad business reason not to up the rent. If that was so, rents would nver go up.

Anyway, best of luck in the new move.:)

antoinolachtnai

The OP could appeal the rent increase to the PRTB (although he would have to pay the increase until the decision came through). But a rent increase of this magnitude seems reasonable to me and would quite likely be accepted by PRTB.

I don't think he needs to worry about having that space vacant for very long at this time of year.

SkepticOne

He's in a 2 bed in D4.

June Report: Average price 2 bed D4: 1,694
August Report: 1,683

Marginally down.

We are not seeing a massive jump in rents in the last few months as some people are suggesting. Nationally the latest figures show rents falling slightly on average across the country over the last few months.

Pay no notice of the spin and commentary in these reports. Go to the actual numbers. Do your own comparisons.

patrickolee: "Rents have risen quite sharply over the last few months. Sorry."

Still love to know where you got that from!

SkepticOne

TablesHere's some figures for the OP based on the Daft reports. We can see that in his area (Dublin 4) there was some growth early in the year but some of this has been given back lately. Nevertheless, some areas in Dublin are still showing increases despite an overall national downward trend. I would expect as more supply becomes available these other areas will also start to see falls.s

Perhaps as a negotiating tactic, bring the landlord to the window and show him the cranes building apartments around Dublin and explain that these apartments will become available over the next year.

2 Bed App	Report Month		
	      March   June    August
Dublin 1	1412	1459	1471
Dublin 2	1679	1751	1728
Dublin 3	1330	1417	1356
Dublin 4	1621	1694	1683
Dublin 5	1248	1301	1321
Dublin 6	1379	1418	1386
Dublin 6W	1372	1387	1321
Dublin 7	1278	1313	1334
Dublin 8	1308	1327	1349
Dublin 9	1245	1252	1278
Dublin 10	1209	1191	1248
Dublin 11	1179	1210	1242
Dublin 12	1253	1241	1297
Dublin 13	1424	1375	1404
Dublin 14	1425	1454	1465
Dublin 15	1268	1278	1313
Dublin 16	1272	1331	1383
Dublin 17	1243	1258	1242
Dublin 18	1574	1602	1585
Dublin 20	1188	1205	1326
Dublin 22	1153	1198	1278
Dublin 24	1171	1204	1226
North Co Dublin	1131	1171	1194
South Co Dublin	1436	1496	1523
West Dublin	1114	1152	1297
Commuter Towns	1132	1106	1031
Commuter Counties	869	887	908
West Leinster	658	659	664
SE Leinster	697	707	719
Cork City	1015	1028	1037
Limerick City	767	790	774
Waterford City		743	717
Rest of Munster	759	759	779
Galway City	920	921	938
Rest of Conn/Ulster	630	618	628

antoinolachtnai

Surely rents always go down a little in August and then up again in September?

SkepticOne

The figures show that rents in D4 are up 3.82% since the start of the year to August. I can't find any figures broken down in this way for 2006 but I think we can allow for perhaps 8% growth in a 12 month period tailing off towards the end of that period. Some areas actually fell over the same period.

The OPs landlord would not appear to be justified.

The last three months are showing an overall fall for the country. While this may be partly due to Summer vacancies as suggested, I believe that with the housing supply coming on stream over then next year I would expect rents to continue to fall.

One thing is for sure there is no evidence that rents have been rising over the last few months. What evidence we do have suggests falling rents.

antoinolachtnai

Re whether the rent increase is justified, it isn't just a matter of the rate of increase, it's also a matter of what the base rent was to start with (it could have been too low). Also, there could be factors relevant to the particular block or development. The OP has to find similar properties available as close by as possible to prove his point.

DubDani

I don't think these stats are always very accurate.

I rented a small 2 BR apartment in Stepaside last June for 1050 Euro a month, and this june is was let (to someone else) for 1400 Euro.

A friends rent in Sandyford has just bene increased from 1250 to 1450 as well. Rents are def. heavily on the way up. No stats are needed to see for anyone that rents are going up a lot lately. just have a loom around daft now... save the ads, and look again in three months for the same or similar properties...

rediguana

I don't live in Dublin 4! Yes, I'm not far from it, and yes there's a decent bus service, but the actual postal address can have a big impact on prices, and my apartment is located (technically) in Co Dublin.

I wasn't making the point, per se, that the landlord is a scheming deviant to up the rent by so egregious a percentage. I was just trying to get some kind of consensus on whether people thought it was way too much, or typical, or what.

I don't obsess over the housing-renting market, I had just thought that rents were slipping so it seemed a hefty increase to me, particularly as we've been here a year.

SkepticOne

rediguana wrote:

I wasn't making the point, per se, that the landlord is a scheming deviant to up the rent by so egregious a percentage. I was just trying to get some kind of consensus on whether people thought it was way too much, or typical, or what.

I think it is fairly underterstandable what the landlord is trying to do. Everyone wants their business to make a bit more money. If he is a recent landlord then he will have seen his interest bill shoot up recently due to EU base rate rises. If he is used to his tenant covering the costs he will naturally want to raise the rent. Unfortunately for him, it does not always work like that.

You are now armed with some stats as you requested and can see areas in Dublin that are static and even falling in prices in some areas.