Government Advertises in Newspapers telling people to ask for rent reductions?

Now i must admit I'm more than a little bit angry over this. I don't believe the government has any cause to be doing this, and secondly they're making it harder for people trying to offset their mortgages by renting out their properties.

here's the lowdown. In a number of local and national papers I've seen advertisements from various government departments including the health Board recommending people to ask their landlords for rent reductions.

My problem is that the rental market in Ireland is already crap, and has been for years. I understand that people are having a hard time paying their rents, but I really don't need the government telling my tenants to ask for less rents. For the first time in 5 years, my property is breaking even. Mortgage interest rates have come down enough that the rent I receive is finally covering my mortgage and house insurance.

I've been unemployed and on Jobseekers benefit for the last 6 months. I can't afford to live in my own house, and cover the mortgage, so renting the property is the only answer. Which means I can't get Mortgage relief. I have an auctioneer looking after the property for new tenants, but they charge a commission of 10% of the yearly rent for every new tenant needed. My previous tenants didn't look after the house, and their deposit didn't cover the costs of repairs to carpets, plumber, and damage to furniture which needed to be paid before I could get in new people.

So where do the government come off with this? I don't believe that it is their responsibility to be suggesting this type of action to people. God knows, Irish people have never been shy about demanding lower rents before, so why encourage an already crappy market to get even worse?

silverside

The government also ran campaigns telling people to eat their greens, belt up, and take in the dog at night. They obviously feel that people need to be led to save them from themselves. Isn't that one of the jobs of a government ?

edit: Maybe in the interests of fairness they should also run a campaign encouraging landlords to ask for rent rises ? Would that work?

Raiser

Deleted User wrote: »

PARAPHRASE - I had a Dream that people less fortunate than me would pay my poor value and bad investment driven Mortgage if I gave them enough time /PARAPHRASE

The Country is mid-flush, more than likely your Tenants are earning a lot less than they were and the trend will continue downwards - I don't see why they should pay for you entering the Property Market at an inopportune time....

delop

Klaz, how much rent are you charging and whats the approx location of your house?

Mozart1986

I was just going to ask the same question. I don't know how you could possibly say the rent market is crap. Maybe it is difficult some places around the country away from Dublin or Cavan. But maybe you made a bad investment and were looking for outrageous rent. We have two properties that have been paying rented continuously for years and we didn't need auctioneer. Maybe circumstances make an auctioneer a necessity, I know dunno. Maybe you'd get better tenants if you looked after it yourself and monitored the property (albeit unobtrusively). The auctioneer doesn't care about damage or decent tenants, its not his house

But landlords have had it their own way with regards rents for years. We never asked for the price we could have got, or raised the rent extortionally even though we could have. Thats is just bad karma. Now the bottoms fallen out from under the and its a tenants market once again, and we've got very good tenants because we've always looked after them. They've usually replaced themselves and all we did was oversee the transfere. We have had nightmares too but we've the properties for a long time.

I have no pity. If you had looked after your tenants they may have looked after you.

I am glad the government is looking after renters. It is a time to buy so they need a break.

ejmaztec

It's all down to market forces like everything else. I've done many accounts for buy-to-letters in recent years, and none of them made a profit, most not even recouping the interest on their loans, let alone other overheads. I think that most people assumed that these properties were going to be sold on at a profit some years down the line, but that's not going to happen now.

A few years ago, the government did away with interest relief on rental properties, then at the height of the boom reintroduced the relief, giving potential buy-to-letters more incentive to jump on the bandwagon. This was another big mistake by FF, and many more property investors, thinking that they were going to make some big money have since been caught with their pants down.

I wouldn't like to estimate the number of vacant lets kicking around the country, but when one considers that many renters were from other EU countries, and most of these have gone home, the number must be substantial.

I mentioned in a similar post some time ago that many of these BTL loans are going to be in default soon when investors with no tenants can no longer pay for two properties out of their own income.

Raiser

Raiser wrote: »

The Country is mid-flush, more than likely your Tenants are earning a lot less than they were and the trend will continue downwards - I don't see why they should pay for you entering the Property Market at an inopportune time....

entering the Property Market at an inopportune time? I bought the house 5 years ago. I lived in it for 3 years, and then went abroad, so I rented it out. For the whole period I was abroad I was making a loss of roughly 200 euro a month, not counting the costs in repairs, and replacement of furniture.

delop wrote:

Klaz, how much rent are you charging and whats the approx location of your house?

My place is in Cork. I'm charging €850 for a three storey townhouse (3 large bedrooms). The average I have found from checking daft and other sites for a similar property is €900-€950.

Mozart1986 wrote:

I was just going to ask the same question. I don't know how you could possibly say the rent market is crap. Maybe it is difficult some places around the country away from Dublin or Cavan. But maybe you made a bad investment and were looking for outrageous rent. We have two properties that have been paying rented continuously for years and we didn't need auctioneer. Maybe circumstances make an auctioneer a necessity, I know dunno. Maybe you'd get better tenants if you looked after it yourself and monitored the property (albeit unobtrusively). The auctioneer doesn't care about damage or decent tenants, its not his house

I've had three separate periods of one-two months where I just could not find anyone to take the place.. A few viewings, but nothing major. This was my own home, so its well kitted out. I use an auctioneer, since I'm now living at home with my parents a good distance away, and I'm unable to monitor the house, or the needs of the tenants adequately.

Mozart1986 wrote:

I have no pity. If you had looked after your tenants they may have looked after you.

I look after my house well. If there's a problem I fix it immediately. All the furniture, tv, etc are mine. I lived in that house for three years, and decked it out quite nicely, since I was earning decent money when the estate was being built. But I've had people bringing in pets even though I've said no to pets. I've had people smoking even though i've requested no smoking. I've also had a couple who jumped ship without paying rent, stealing anything they could easily carry.

I've had excellent tenants in the past, and I didn't start this thread to jump down the throats of the tenants. For the most part, I have no issues with those renting. I'm just seeking to pay my mortgage/insurance. I gave up on the idea of making a profit years ago.

I am glad the government is looking after renters. It is a time to buy so they need a break.

Again, I have no issues with the government looking after renters. I've never avoided giving out my details so that renters can get the various financial help the government is providing. But i do have an issue with the government encouraging people to seek lower rents in such a manner. I don't see it as being their job to do this. Providing support, definitely. This, no.

delop

Deleted User wrote: »

My place is in Cork. I'm charging €850 for a three storey townhouse (3 large bedrooms). The average I have found from checking daft and other sites for a similar property is €900-€950.
.

Sounds like you will be fine so, Rent is reasonable and Sounds like its a sharp enough place...

Im sure the advice was referring to Crazy rents, like 14,000 to 16,00 for 3 beds in dublin....

Fighting Irish

Deleted User wrote: »

I've been unemployed and on Jobseekers benefit for the last 6 months. I can't afford to live in my own house, and cover the mortgage, so renting the property is the only answer. Which means I can't get Mortgage relief. I have an auctioneer looking after the property for new tenants, but they charge a commission of 10% of the yearly rent for every new tenant needed. My previous tenants didn't look after the house, and their deposit didn't cover the costs of repairs to carpets, plumber, and damage to furniture which needed to be paid before I could get in new people.

its the governments fault

djpbarry

Deleted User wrote: »

I understand that people are having a hard time paying their rents, but I really don't need the government telling my tenants to ask for less rents.

By the sounds of things the rent you are charging is quite reasonable so you’ve nothing to worry about. If your tenants ask for a reduction and you say no, what are they going to do? Move elsewhere and pay more?

Having said that, I would agree that I don't really think it's the government's place to be telling people to try and renegotiate their rent - do you have an example of one of these ads you are referring to?

jimmmy

Deleted User wrote: »

Now i must admit I'm more than a little bit angry over this. I don't believe the government has any cause to be doing this, and secondly they're making it harder for people trying to offset their mortgages by renting out their properties.

here's the lowdown. In a number of local and national papers I've seen advertisements from various government departments including the health Board recommending people to ask their landlords for rent reductions.

Its not that long ago since the government was trying to encourage people to invest in the Irish economy / Irish housing rental market , by offering section 23 and section 27 incentives. Now that many residential units in the country ( estimated to be 200,000 ) are empty and the owners in negative equity, the govt decide to waste another few million on big adds in the national media etc telling tenants to bargain ....you could not make it up.

TheInquisitor

Deleted User wrote: »

I have an auctioneer looking after the property for new tenants, but they charge a commission of 10% of the yearly rent for every new tenant needed.

Man rent the property on daft yourself. If your unemplyed then you should have plenty of time to do this. It'll mean you can choose the right tenants and cut out on that 10% commission!! save yourself a grand year!

who_ru

given that the govt have lined the pockets of landords for years through rent supplements i find this a case of too little too late. also the very same govt is paying millions to vested interests in renting office space it will never use - decentralisation for example

the rent supplement artifically sets a floor on rents - it is anti market forces.

rents would be even lower were it not for this stupid govt intervention in the property market - something they have been doing for years and look where it got them, renters, landlords and everyone else - in the s**t that's where.

falling rents are constantly being presented as a bad news story by a agenda driven media - if rents are falling it is always presented/reported as a negative development. so if people are spending less of their disposable income on rent - they then have the discretionary option of spending more of it in shops/pubs/restaurants/other goods & services etc which in an economy like ours needs people to spend a bit to sustian - wait for it!!! JOBS - but oh no falling rents are bad bad bad because all the investors are losing money.

god you couldn't make it up.

Akrasia

Deleted User wrote: »

My problem is that the rental market in Ireland is already crap, and has been for years. I understand that people are having a hard time paying their rents, but I really don't need the government telling my tenants to ask for less rents. For the first time in 5 years, my property is breaking even. Mortgage interest rates have come down enough that the rent I receive is finally covering my mortgage and house insurance.

you obviously paid far too much for your property or leveraged yourself too highly. (probably both)
Irish rents are still too high.

If the irish economy is ever going to recover, we need to get our cost base down, and domestic and commercial rates are key drivers of wages and prices in our economy.

I've been unemployed and on Jobseekers benefit for the last 6 months. I can't afford to live in my own house, and cover the mortgage, so renting the property is the only answer. Which means I can't get Mortgage relief. I have an auctioneer looking after the property for new tenants, but they charge a commission of 10% of the yearly rent for every new tenant needed.

If you're unemployed, why pay an auctioneer to do your job for you?

So where do the government come off with this? I don't believe that it is their responsibility to be suggesting this type of action to people. God knows, Irish people have never been shy about demanding lower rents before, so why encourage an already crappy market to get even worse?

because the state pays a lot of these rents through rent reliefs, tax reliefs and social housing programs.

jimmmy

Deleted User wrote: »

I understand that people are having a hard time paying their rents

Not everyone is. In some parts of the country, where there are a lot of surplus empty buildings, some weekly rents are 100 euro or less. Given the levels of wages, affordability is not an issue for all renters.

jimmmy

ejmaztec wrote: »

It's all down to market forces like everything else. I've done many accounts for buy-to-letters in recent years, and none of them made a profit, most not even recouping the interest on their loans, let alone other overheads. I think that most people assumed that these properties were going to be sold on at a profit some years down the line, but that's not going to happen now.

A few years ago, the government did away with interest relief on rental properties, then at the height of the boom reintroduced the relief, giving potential buy-to-letters more incentive to jump on the bandwagon. This was another big mistake by FF, and many more property investors, thinking that they were going to make some big money have since been caught with their pants down.

I wouldn't like to estimate the number of vacant lets kicking around the country, but when one considers that many renters were from other EU countries, and most of these have gone home, the number must be substantial.

I mentioned in a similar post some time ago that many of these BTL loans are going to be in default soon when investors with no tenants can no longer pay for two properties out of their own income.

Well sail. The govt spending millions telling people to kick the property investors when they are down is just going to result in more defaults, more misery , and people who will be less likely to want to invest anything in Ireland again.

cm2000

Deleted User wrote: »

For the first time in 5 years, my property is breaking even. M

Well thats the problem!
Renting your house out isn't supposed to cover all your costs.. if that were the case then people wouldn't rent long term.. your renters are paying your entire mortgage and insurance and you think this is fair?? rubbish.

the_syco

Deleted User wrote: »

I have an auctioneer looking after the property for new tenants, but they charge a commission of 10% of the yearly rent for every new tenant needed. My previous tenants didn't look after the house, and their deposit didn't cover the costs of repairs to carpets, plumber, and damage to furniture which needed to be paid before I could get in new people.

Did your auctioneer get the previous tenants? Maybe you should think of doing the work yourself, to ensure you get good tenants. The auctioneerdid their job: got you tenants. They just didn't bother getting good tenants. If you got the bad tenants, you learnt a lesson on who not to rent to.

ejmaztec

the_syco wrote: »

Did your auctioneer get the previous tenants? Maybe you should think of doing the work yourself, to ensure you get good tenants. The auctioneerdid their job: got you tenants. They just didn't bother getting good tenants. If you got the bad tenants, you learnt a lesson on who not to rent to.

I've seen various cases over the years where "respectable" tenants have been anything but, after they've moved in, whether chosen by an auctioneer or the owner. Some people are very convincing.

It's always a risk.

serfboard

I don't see this as any different to the government's campaign of a few years ago "Know the price, or pay it", encouraging consumers to shop around.

(Of course, that one backfired when everyone knew that the prices in the north were cheaper and went up there )

I don't remember hearing the retail industry at the time saying "Hey, how am I supposed to cover my overheads with this?". It's called encouraging competitiveness, and that will help the economy overall.

The other advantage for the government is that if the price of rents comes down, then it will save massive amounts of money in rent supplements.

And that will knock something off the 20 billion health/welfare budget.