Some good news anyway! Rents still on the up!

Mark Spilane

Remember the "prices are only going up" brigade during the boom days. Now its gone the opposite way. So many people refusing to look at whats in front of their eyes.

Dont get your hopes up for mass repossessions either. I think what will happen is that those about to be repossessed will come to an agreement with the banks before repossession. The banks dont really want to repossess. They just want to be able to put pressure on the owner to start paying a reasonable figure.

Yes there will be some repos, but they will be high end and not affordable anyway, any low end will be snapped up by investors , looking to make a killing on the high rents we have in Dublin now. If you want you can by a 3 bed house in Sligo for 50k even now.
My brother bought a 3-bed semi a couple of months ago for 45k to use for a holiday home for the family - not in Dublin of course.

The problem is that everybody wants to live in the cities, so demand, rent, sale prices will be high compared to everywhere else.

Potatoeman

Mark Spilane wrote: »

Remember the "prices are only going up" brigade during the boom days. Now its gone the opposite way. So many people refusing to look at whats in front of their eyes.

Dont get your hopes up for mass repossessions either. I think what will happen is that those about to be repossessed will come to an agreement with the banks before repossession. The banks dont really want to repossess. They just want to be able to put pressure on the owner to start paying a reasonable figure.

Yes there will be some repos, but they will be high end and not affordable anyway, any low end will be snapped up by investors , looking to make a killing on the high rents we have in Dublin now. If you want you can by a 3 bed house in Sligo for 50k even now.
My brother bought a 3-bed semi a couple of months ago for 45k to use for a holiday home for the family - not in Dublin of course.

The problem is that everybody wants to live in the cities, so demand, rent, sale prices will be high compared to everywhere else.

What is in frount of our eyes. People keep talking about the great value around now compared to peak but that ignores the huge increases during the boom years. Some areas have returned to reasonable prices but other areas have not.

Ray Palmer

EricPraline wrote: »

Pretty sure this isn't true. Large NAMA-controlled sites exist in Sandyford and Merrion Road D4.

A few years ago the numbers being mentioned were high and I presume the number has gone higher, as more developers have gone into receivership:

In 2011 they had 8000 place to rent. 2013 rents have gone up an demand is outstripping supply. Do you think maybe the 8000 unit are rented now? Meaning Nama doesn't have a stack of properties to rent out at the moment that they are keeping off the market. That was my point about Nama not having much property to drop on the market.

EricPraline wrote: »

NAMA is also involved in the proposed continuation of unfinished developments in the Dublin Docklands:

Can't live in them at the moment and while they have future plans they don't have immediate plans. Again a red herring of additional supply that isn't coming along any time soon

EricPraline wrote: »

Of course, as pointed out by other posters, this is never going to be released in one go. NAMA controlled properties are likely to be drip-fed to the rental sales markets over the next decade or more .

And there is that main element but it still doesn't mean they have anything to dump on the market anytime soon either way.

gaius c

Casen Nutritious Soloist wrote: »

Is it just in the Dublin area that rent is increasing? Or countrywide? (Obviously excluding the back bogs of Cavan where there's no work)

We've an apartment outside Dublin and demand is definitely up, not to the extent that Dublin is but it is up.

Zamboni wrote: »

He made a balls of the numbers but his point is valid.
There is a host of other obligatory living costs that are not listed.

In saying that though, I don't see rents coming down too soon.
It could be three years for repo sales begin to affect both markets if there is any affect at all.
The private losses that should occur are continually being socialised through debt write downs using state owned banks as the vehicle.
Lots of well connected people are having their personal balance sheets rewritten.
The rest of the mugs will be left paying artificially high rents and artificially high house prices.

Business as usual folks.

Aye. He ballsed up the numbers but it's interesting that the bulls here see no issue with people paying 42% of net household income on rent when the banks are basing their calculations for mortgages on 25% of net income.

We have the beginnings of a serious problem brewing here in Dublin. I know one couple who are moving into a smallish house with another couple because they cannot afford a place on their own. Four adults in a 2 bed terrace. That's 2nd world territory right there.

We cannot have a society where people get to live in houses for free while other people (mainly younger) are forced to cram into limited stock and pay through the nose but that's what we are starting to creep towards.

Ray Palmer wrote: »

In 2011 they had 8000 place to rent. 2013 rents have gone up an demand is outstripping supply. Do you think maybe the 8000 unit are rented now? Meaning Nama doesn't have a stack of properties to rent out at the moment that they are keeping off the market. That was my point about Nama not having much property to drop on the market.

Can't live in them at the moment and while they have future plans they don't have immediate plans. Again a red herring of additional supply that isn't coming along any time soon

And there is that main element but it still doesn't mean they have anything to dump on the market anytime soon either way.

He gave you hard numbers and you respond with speculation & bluffery?
If nothing else, it's inconsiderate.

Ray Palmer

gaius c wrote: »

He gave you hard numbers and you respond with speculation & bluffery?
If nothing else, it's inconsiderate.

He didn't give me hard numbers. He gave me out of date numbers when we have specifically talking about how rents have gone up over the period since. Not sure what you don't understand about that but it certainly isn't "hard numbers". It is speculative to say these are still vacant and there are much more now which is what his post was saying.

If it is now inconsiderate to counter a point then the whole of boards is incosiderate

gaius c

Ray Palmer wrote: »

He didn't give me hard numbers. He gave me out of date numbers when we have specifically talking about how rents have gone up over the period since. Not sure what you don't understand about that but it certainly isn't "hard numbers". It is speculative to say these are still vacant and there are much more now which is what his post was saying.

If it is now inconsiderate to counter a point then the whole of boards is incosiderate

And your "hard numbers" are?

All you can do is point to the sympthoms (increasing rent) with no real understanding of what's actually wrong with the patient bar your confirmation bias leading you to jump to conclusions that may or may not be correct.

StillWaters

gaius c wrote: »

We have the beginnings of a serious problem brewing here in Dublin. I know one couple who are moving into a smallish house with another couple because they cannot afford a place on their own. Four adults in a 2 bed terrace. That's 2nd world territory right there. We cannot have a society where people get to live in houses for free while other people (mainly younger) are forced to cram into limited stock and pay through the nose but that's what we are starting to creep towards.

I'd hardly call it second world in fairness. In any case what do you advocate for the rental sector, price fixing? The real socio-economic problem is not affordability in the rental sector, it's unsustainable mortgages amongst the people who came of age during the bubble. The lack of labour Market mobility and lack of disposable income they face is a huge issue that a rising economy will take a long long time to resolve. I'm not sure of what policy interventions or levers would or could resolve this.

Potatoeman

StillWaters wrote: »

I'd hardly call it second world in fairness. In any case what do you advocate for the rental sector, price fixing? The real socio-economic problem is not affordability in the rental sector, it's unsustainable mortgages amongst the people who came of age during the bubble. The lack of labour Market mobility and lack of disposable income they face is a huge issue that a rising economy will take a long long time to resolve. I'm not sure of what policy interventions or levers would or could resolve this.

There is a certain amount of readjustment as people are not spending as much as they were but many were spending credit and not savings. The downturn was a wakeup call for many without any savings and as six month 0% credit was wiped out. I know someone that had 15k on their credit card that they were transferring to a different company every six months. There were many unsustainable businesses that should never existed.

Ray Palmer

gaius c wrote: »

And your "hard numbers" are?

All you can do is point to the sympthoms (increasing rent) with no real understanding of what's actually wrong with the patient bar your confirmation bias leading you to jump to conclusions that may or may not be correct.

I don't need any figures. A claim was made that Nama had thousands of rental properties to drop on the market. I asked for proof none was given by the poster. A later poster post up data years out of date. Neither providing proof to validate the claim. The onus is not for me to provide data to disprove as they have no proof it is true. On top of the fact Nama will not dump on the market. The fact they have development opportunities means nothing either.

Lack of supply is a reality and proof has be stated over an over again.

gaius c

Ray Palmer wrote: »

I don't need any figures. A claim was made that Nama had thousands of rental properties to drop on the market. I asked for proof none was given by the poster. A later poster post up data years out of date. Neither providing proof to validate the claim. The onus is not for me to provide data to disprove as they have no proof it is true. On top of the fact Nama will not dump on the market. The fact they have development opportunities means nothing either.

Lack of supply is a reality and proof has be stated over an over again.

2011 is not exactly ancient times and the fact of the matter is that you have no data at all, none.

2011 census found a vacancy rate of 10.2% in Dublin city. Including the subhurbs, it's still 8.4%. State vacancy rate is 14.5%.

Normal vacancy rate for a functioning, mature urban rental market is 5% so Dublin city is running at double that. Unless you can demonstrate that the vacancy rate is now less than 5%, you're basically hiding beind lack of supporting data for your own position and posting it as proof.

P.S. An interesting oddity with the census figures is that vacancy rates for all of our cities are higher than the subhurbs. Strange really. Would have thought the majority of young renters would want to live closer to their place of work.

With a vacancy rate running higher than the norm, there must be artificial throttling going on to put pressure on rents. Simple as.

murphaph

gaius c wrote: »

2011 census found a vacancy rate of 10.2% in Dublin city. Including the subhurbs, it's still 8.4%. State vacancy rate is 14.5%.

...

P.S. An interesting oddity with the census figures is that vacancy rates for all of our cities are higher than the subhurbs. Strange really. Would have thought the majority of young renters would want to live closer to their place of work.

How do they CSO determine vacancy rate from the census? If someone refuses to open the door and return the form is that considered a vacant property? It would certainly tally with lower "vacancy rates" in the suburbs as there are fewer apartments and it's easier for the census collector to "hassle" the occupants of 10 houses in an estate than 10 apartments in a block simply because you have access to the front door of a house and with an apartment it's "easier" to simply ignore people.

In short, I don't belive for a second that 1 in 10 (habitable!!) properties in Dublin is lying idle. Do you? How do you explain that given the increasing rents? There's obviously money to be made from renting property out so why would 1 in 10 (habitable!) properties be empty?

Ray Palmer

gaius c wrote: »

2011 is not exactly ancient times and the fact of the matter is that you have no data at all, none.

2011 census found a vacancy rate of 10.2% in Dublin city. Including the subhurbs, it's still 8.4%. State vacancy rate is 14.5%.

Normal vacancy rate for a functioning, mature urban rental market is 5% so Dublin city is running at double that. Unless you can demonstrate that the vacancy rate is now less than 5%, you're basically hiding beind lack of supporting data for your own position and posting it as proof.

With a vacancy rate running higher than the norm, there must be artificial throttling going on to put pressure on rents. Simple as.

Actually in these terms 2011 is ancient times. The rental market is pretty quick moving. I don't have to hide behind anything as they have simply not provided proof. Lack of places to rent is proof their is shortage.

Well if you go back and look on CSO figures you will see 10% is about normal for the vacancy rate in Dublin as far as I remember. I refute your claim it should be 5%. Can you show where this is normal in Ireland? You made a claim now support it.

gaius c

murphaph wrote: »

How do they CSO determine vacancy rate from the census? If someone refuses to open the door and return the form is that considered a vacant property? It would certainly tally with lower "vacancy rates" in the suburbs as there are fewer apartments and it's easier for the census collector to "hassle" the occupants of 10 houses in an estate than 10 apartments in a block simply because you have access to the front door of a house and with an apartment it's "easier" to simply ignore people.

In short, I don't belive for a second that 1 in 10 (habitable!!) properties in Dublin is lying idle. Do you? How do you explain that given the increasing rents? There's obviously money to be made from renting property out so why would 1 in 10 (habitable!) properties be empty?

I'm sure they would have missed some but from our experience, the CSO were around apartment blocks well in advance of the actual census and get access to blocks so they can (and did) doorstep people. The census taker in our complex had every apartment tallied up about a week before census night.

On the other hand, the census did not count completed but empty blocks like Clancy Quay so this would have caused an undercount of empties (I know this because our census taker was the one trying to get access to that complex to count them). Errors can go both ways but you're making the same assumption as Ray in that all errors lead to empties being overstated. That's called confirmation bias btw.

Ray Palmer wrote: »

Actually in these terms 2011 is ancient times. The rental market is pretty quick moving. I don't have to hide behind anything as they have simply not provided proof. Lack of places to rent is proof their is shortage.

Well if you go back and look on CSO figures you will see 10% is about normal for the vacancy rate in Dublin as far as I remember. I refute your claim it should be 5%. Can you show where this is normal in Ireland? You made a claim now support it.

Firstly, to refute something, you must provide evidence that refutes it so you're not refuting, you're denying, which is a rather different kettle of fish.

5% is the vacancy level New York uses to determine whether a change in rent control is required. Less than 5% means they increase the rates, more than 5% means they decrease them. It's a pretty standardly accepted figure so I'm curious that an experienced landlord like you would be ignorant of it. Here's a Forbes article that mentions it in passing.

In the sales market, a 5% unsold inventory equals a glut, whereas in the rental market, a 5% vacancy rate indicates a healthy market.

An article in the LA Times mentions it as "normal". The state of Minnesota thinks likewise. I await Ray's "but Ireland is different" response to explain away why figures used in mature rental markets are meaningless...

Sorry dude but I'm not going to be engaging with you any more for a number of reasons:
1. You provide no evidence of your own. At all. You're not a refuter, you're a denier whose own agenda means that you refuse to consider any evidence that might impinge on your "rents are going up and up and up and up" mantra.

2. You complain about the quality & relevance of data being presented to you but provide none of your own bar your own assertation that the "lost" rental supply from 2009 has been rented out since. You don't know that. For all you know, it could be sitting empty on the sales market.

3. Your sole evidence for the "health" of the rental bull market is that rents are going up. It's a circular argument because the overall property market is clearly FUBAR'd but you're just going to keep ignoring that and focusing on one tree while ignoring the fact that the forest is on fire. I guess you used a similar tactic for debating the health of the sales market in the mid noughties? "House prices are going up so the market is fine and there's clearly a shortage"???

Ray Palmer

So New York, Minnesota and LA are in Ireland now!

You can't show it is abnormal in IRELAND! You can't show proof to your claim. A gauge used for rent rates in another country is in no way proof or comparable.

I am pretty sure the normal rate is 10% in Dublin. I remember it was 16% in Dublin during the boom. So it has actually decreased.

You can go look at the Nama properties for sale on their website. If you can find these 8,000+ for sale you can prove they were waiting to be sold.

I don't know what your fascination is of using irrelevant and/or out of date data.

Potatoeman

Ray Palmer wrote: »

So New York, Minnesota and LA are in Ireland now!

You can't show it is abnormal in IRELAND! You can't show proof to your claim. A gauge used for rent rates in another country is in no way proof or comparable.

I am pretty sure the normal rate is 10% in Dublin. I remember it was 16% in Dublin during the boom. So it has actually decreased.

You can go look at the Nama properties for sale on their website. If you can find these 8,000+ for sale you can prove they were waiting to be sold.

I don't know what your fascination is of using irrelevant and/or out of date data.

By that logic CSO data is useless so where is he going to get his figures from. Also rejecting standard trends is what caused the current crisis. Ireland is not as many would wish a special case.

gaius c

Only because I'm bored...

Ray Palmer wrote: »

I am pretty sure the normal rate is 10% in Dublin. I remember it was 16% in Dublin during the boom. So it has actually decreased.

Citation for those figures please.
If you're so sure, you should have no trouble backing it up with reputable sources.

Ray Palmer

Potatoeman wrote: »

By that logic CSO data is useless so where is he going to get his figures from. Also rejecting standard trends is what caused the current crisis. Ireland is not as many would wish a special case.

I didn't reject CSO figure. Standard trends are related to local standards. The USA is not Ireland and the use of 5% is to raise rents. Relevance of this information is NIL.

gaius c wrote: »

Only because I'm bored...

Citation for those figures please.
If you're so sure, you should have no trouble backing it up with reputable sources.

Prove it is 5% in this country and I will. You have not made a valid claim yet. If you are bored you have the time to go look. I am pretty sure if you search boards you will see it was much higher during the boom. (16% in Dublin)

You think you are being smart about me not proving figure but you are making the claims and can't back them up. I am telling you what I recall without looking. If I am wrong you should be able to provide proof to back up your claim. My claim is simply you can't provide proof and I think it is different from memory.

gaius c

Lets try again Ray.

Ray Palmer wrote: »

I am pretty sure the normal rate is 10% in Dublin. I remember it was 16% in Dublin during the boom. So it has actually decreased.

Citation for those figures please.

16% is a very specific figure so I'm sure you have a good citation for it.
P.S. Your memory doesn't count.

Ray Palmer

gaius c wrote: »

Lets try again Ray.

Citation for those figures please.

16% is a very specific figure so I'm sure you have a good citation for it.
P.S. Your memory doesn't count.

As I said you need the citation first you are making the claim of fact I am not. I am saying I recall it was one way you stated before that 5% is what the vacancy rate is normally. Prove that, I don't believe you are right and have told you what I remember.

I repeat
My claim is simply you can't provide proof and I think it is different from memory.

You don't need to bother asking for a citation again as I won't provide one until you provide proof and citation of you claim. You made the claim not me

gaius c

Ray

Ray Palmer wrote: »

I am pretty sure the normal rate is 10% in Dublin. I remember it was 16% in Dublin during the boom. So it has actually decreased.

Citation for those figures please.

I'm starting to think that you might have been talking out of your hat in an effort to deflect from actual referenced numbers?

Ray Palmer wrote: »

I didn't reject CSO figure. Standard trends are related to local standards. The USA is not Ireland and the use of 5% is to raise rents. Relevance of this information is NIL.

Ireland is different?

You think you are being smart about me not proving figure but you are making the claims and can't back them up. I am telling you what I recall without looking. If I am wrong you should be able to provide proof to back up your claim. My claim is simply you can't provide proof and I think it is different from memory.

No, you're just doing the equivalent of "you can't prove that god doesn't exist".

Mark Spilane

Bears are the new Bulls.
Just like the Bulls of years gone by, it will be impossible to convince them of what is in front of their eyes.
Its just impossible. Like arguing with the wife. She will never give in.

gaius c

More great news*.

CSO - Private Rents +0.5% in July, +7.2% y.o.y.

Link



*There may be some sarcasm in the tone of this statement.