Rent prices

padma

Cuddlesworth wrote: »

There are risks and costs you are not thinking about. Maybe a year or two of no rent followed by a 25k repair cost? The reality that property is overvalued, so in 25 years it could be conceivably be worth less. More money could have been made by simply dropping that money into a low interest bank account.

I understand that but any Landlord who gets into it for investment as I was looking at that, will most likely buy in a suitable renting area etc... although of course there are risks but from my feeling the rewards will reap and could far outweigh the potential for a loss.

Potatoeman

Idbatterim wrote: »

Possibly, but it depends over how long the mortgage is, also factor in the annual management fee, home insurance and I'm assuming life assurance, plus the deposit and solicitor fee, maybe a surveyor, stamp duty etc...

It should be cheaper to rent. Once you pay off your mortgage you own the property and as you pay off capital the payments reduce.

Barely Hedged

padma wrote: »

I understand that but any Landlord who gets into it for investment as I was looking at that, will most likely buy in a suitable renting area etc... although of course there are risks but from my feeling the rewards will reap and could far outweigh the potential for a loss.

The ECB last week reduced their base rate to 0.25% because of low inflation. The Japanese economy has stagnated for years with little inflation or deflation. The Euro zone could become deflationary for several years and stagnate and therefore the end price achievable on the investment is significantly lower than the example provided.

Also, youre negating new housewares, beds, repainting, new showers, new boilers, boiler inspections, PRSI on the rental income, increased management fees, repairs to lifts in an apartment if the sinking fund is not large enough, other apartments failing to pay management fees increases all other management fees, dormancy of apartment (1 month a year is considered the norm), vindictive and calculating tenants are a nightmare

padma

Barely Hedged wrote: »

The ECB last week reduced their base rate to 0.25% because of low inflation. The Japanese economy has stagnated for years with little inflation or deflation. The Euro zone could become deflationary for several years and stagnate and therefore the end price achievable on the investment is significantly lower than the example provided.

Also, youre negating new housewares, beds, repainting, new showers, new boilers, boiler inspections, PRSI on the rental income, increased management fees, repairs to lifts in an apartment if the sinking fund is not large enough, other apartments failing to pay management fees increases all other management fees, dormancy of apartment (1 month a year is considered the norm), vindictive and calculating tenants are a nightmare

Yes I see all that but say for example if it costs the landlord 25% of his personal monthly income on top of the rent received over the 25 years he is still on the up when it comes to sell. There will be swings and roundabouts in the market I get that, this is why we are discussing because currently there is a swing on the upwards scale.

Is it right though, I understand supply and demand but that doesn't mean if coco pops become the number 1 seller of cereal that they should increase the price of coco pops. :pac:

I'm not too tuned in to this world but I work for a landlord and look after his property and collect rent for him in 40 apartments and I understand the headache that goes with bad tenants but He does seem to be able to cope and copes quite well currently.

Barely Hedged

padma wrote: »

Yes I see all that but say for example if it costs the landlord 25% of his personal monthly income on top of the rent received over the 25 years he is still on the up when it comes to sell. There will be swings and roundabouts in the market I get that, this is why we are discussing because currently there is a swing on the upwards scale.

Is it right though, I understand supply and demand but that doesn't mean if coco pops become the number 1 seller of cereal that they should increase the price of coco pops. :pac:

I'm not too tuned in to this world but I work for a landlord and look after his property and collect rent for him in 40 apartments and I understand the headache that goes with bad tenants but He does seem to be able to cope and copes quite well currently.

All depends how much money you have and what return you expect. Regardless of what you have said, taken all together over 25 years property generally has a low rate of return compared to other investments considering inflation, interest rates, equity prices etc.

The fact that he owns 40 apartments might mean he has deep pockets to get to that size of a portfolio and he might have the cash to create a nice buffer in case of non-payment by tenabts

I doubt all landlords, maybe institutions, have that size of a property portfolio.

padma

Barely Hedged wrote: »

All depends how much money you have and what return you expect. Regardless of what you have said, taken all together over 25 years property generally has a low rate of return compared to other investments considering inflation, interest rates, equity prices etc.

The fact that he owns 40 apartments might mean he has deep pockets to get to that size of a portfolio and he might have the cash to create a nice buffer in case of non-payment by tenabts

I doubt all landlords, maybe institutions, have that size of a property portfolio.

He has more than forty, i just maintain 40 of them

Barely Hedged

padma wrote: »

He has more than forty, i just maintain 40 of them

Once he got them outside of the period 2003 - 2007, he sounds like he should be alright

padma

he did.

riclad

if capital gains go up to 80 per cent ,landlords will just hold on to their propertys if they can afford to do so.
ie just take the rental income,
buying property should be a long term investment ,ie 20 plus years
Otherwise you are in the wrong business.

Victor

St. Lupulin wrote: »

This is the same dude constantly going on about social welfare costs and how evil the unemployed are....

Let's stick to the topic at hand.

Moderator

handlemaster

dar100 wrote: »

What the hell is happening with rent prices lately?? It is absolutely shocking how Landlords are getting away with this.

It is costing people on an adverage industrial wage, almost half their monthly income to rent a two bed apartment, more if you are looking at "nice" areas.

Whats the deal? Obviously supply demaned, but are we not creating another false bubble in the property market? How are people meant to get on in life when most of their income is going on renting a home?

How's your BTL variable rate mortgage performing lately ? Looking forward to the new year rises

handlemaster

Just had a look on daft . In Dublin there are only 1483 residential properties for rent. Very little for a city with a population of 1.5 million.

Barely Hedged

handlemaster wrote: »

Just had a look on daft . In Dublin there are only 1483 residential properties for rent. Very little for a city with a population of 1.5 million.

From a rental report:

The average rent nationwide is now €824. In Dublin, rents were 7.6% higher than a year previously. This is related to very tight supply, with fewer than 1,500 properties available to rent on November 1, compared to over 6,700 on the same date four years previously.