Indo showing how landlords can make a profit in ireland

handlemaster

Good article today in the indo today . Its not on purpose on their be half. They are again trying to slam landlords as thats what sells papers in this country. But what they have actually showed is how LLs can actually make a profit in ireland.

http://m.independent.ie/irish-news/exposed-the-shocking-conditions-of-dublins-rental-accommodation-34711928.html

sKeith

How did you get "Indo showing how landlords can make a profit in ireland" from that article.
Title should be, "Indo has a look at whats on offer in Dublin rentals. Indo did not want it at that price so moved on without haggling."

ABC101

Rather shocking images indeed, I would be ashamed as a LL to be offering such a residence.

Of course there are tenants who are very destructive too, causing enormous damage to properties.

But the article is misleading, not all rental properties are of the standard which is pictured in the article.

The vilification of all landlords continues in the media, Landlords are persecuted by the Irish Revenue Commissioners even though Landlords provide a service which the state is either unwilling or unable to provide for it's citizens.

A 260,000 euro 2 bed apartment in S. Dublin would rent for around 1400 e. / month = 16800 euro / year. Subtract 4500 euro in costs and that leaves 12300 euro per year roughly. Then tax has to be paid.

260K euro would buy you 56,644 BP shares (1.27 euro to the pound, and a SP of 3.62 pounds a share).
56,644 x 0.089 euro = 5044.6 euro return on the 260K investment PER QUARTER. Dividend Tax would have to be paid too of course.

http://www.bp.com/en/global/corporate/investors/information-for-shareholders/dividends.html

But there are no costs in holding the shares, no call outs at night, clearing blocked drains, house insurance, property tax, management fees, water meters, new carpets etc.

Given the fact that two property investors are leaving the market for every one joining..... it is not hard to see why!

handlemaster

ABC101 wrote: »

Rather shocking images indeed, I would be ashamed as a LL to be offering such a residence.

Of course there are tenants who are very destructive too, causing enormous damage to properties.

But the article is misleading, not all rental properties are of the standard which is pictured in the article.

The vilification of all landlords continues in the media, Landlords are persecuted by the Irish Revenue Commissioners even though Landlords provide a service which the state is either unwilling or unable to provide for it's citizens.

A 260,000 euro 2 bed apartment in S. Dublin would rent for around 1400 e. / month = 16800 euro / year. Subtract 4500 euro in costs and that leaves 12300 euro per year roughly. Then tax has to be paid.

260K euro would buy you 56,644 BP shares (1.27 euro to the pound, and a SP of 3.62 pounds a share).
56,644 x 0.089 euro = 5044.6 euro return on the 260K investment PER QUARTER. Dividend Tax would have to be paid too of course.

http://www.bp.com/en/global/corporate/investors/information-for-shareholders/dividends.html

But there are no costs in holding the shares, no call outs at night, clearing blocked drains, house insurance, property tax, management fees, water meters, new carpets etc.

Given the fact that two property investors are leaving the market for every one joining..... it is not hard to see why!

The ordinary man or woman knows notHong about shares evennthose who activally buy and sell them. If thzy dot read the accounts and question what is in them your at the mercy of the markets and tge markets have no mercy. At least with property you might have somthing left when the **** hits the fan.


P.s. shares are a gamble and mining oil shares are at the top of that risk

LiamoSail

ABC101 wrote: »

Rather shocking images indeed, I would be ashamed as a LL to be offering such a residence.

Of course there are tenants who are very destructive too, causing enormous damage to properties.

But the article is misleading, not all rental properties are of the standard which is pictured in the article.

The vilification of all landlords continues in the media, Landlords are persecuted by the Irish Revenue Commissioners even though Landlords provide a service which the state is either unwilling or unable to provide for it's citizens.

A 260,000 euro 2 bed apartment in S. Dublin would rent for around 1400 e. / month = 16800 euro / year. Subtract 4500 euro in costs and that leaves 12300 euro per year roughly. Then tax has to be paid.

260K euro would buy you 56,644 BP shares (1.27 euro to the pound, and a SP of 3.62 pounds a share).
56,644 x 0.089 euro = 5044.6 euro return on the 260K investment PER QUARTER. Dividend Tax would have to be paid too of course.

http://www.bp.com/en/global/corporate/investors/information-for-shareholders/dividends.html

But there are no costs in holding the shares, no call outs at night, clearing blocked drains, house insurance, property tax, management fees, water meters, new carpets etc.

Given the fact that two property investors are leaving the market for every one joining..... it is not hard to see why!

It sounds attractive when you phrase it like that, however while property prices are volatile, I think it's a fair assumption that an apartment in Dublin City Cemtre is unlikely to depreciate by more than 25%.

BP shares are one individuals error away from collapse. One mistake on a rig, on a tanker, or in a terminal could wipe out the share price. Look at what happened after the Deep Water Horizon went down, BP were very nearly no more.

These things happen in the oil and gas business. It was only yesterday I read Shell were leaking oil into the Gulf of Mexico, though I don't know to what extent, but again it's an entirely unforeseen event that could wipe out your investment. Then there's the volatility of oil prices etc..

ABC101

handlemaster wrote: »

The ordinary man or woman knows notHong about shares evennthose who activally buy and sell them. If thzy dot read the accounts and question what is in them your at the mercy of the markets and tge markets have no mercy. At least with property you might have somthing left when the **** hits the fan.


P.s. shares are a gamble and mining oil shares are at the top of that risk

There are risks in all investment classes, including property.

However if you loose all your shares..... what happens... well you have just lost a lot of money.

Given the amount of hassle and vilification of being a landlord the return is rather poor when compared to other asset classes.

The only real justification for being a landlord would be capital gain, rental returns + costs + taxation would not be a reason.

As for having something in hand (property) when it all goes pear shaped is not again not the full story.

A great many property owners wish they had never got into the property business.

Having banks hunting you down for unpaid mortgages / facing bankruptcy courts is not a nice experience. In fact some people have taken their own lives over it.

ABC101

Chaps,

I'm not recommending all Irish Landlords dump their entire property portfolio and buy BP.

BP was only one example of a share pick..... there are others as well....some posters have mentioned Reits etc. Historically the Stock market has been the best performer etc. And yes.... diversification is very important.

But every city / county requires a rental property market. It is a vital service for any functioning society.

However there are a number of factors at work.

1) Vilification of landlords in the media, some by journalists and some by guest commentators on various chat shows.
2) Dept of Finance who are determined to eradicate small time private landlords by using the Irish Revenue Commissioners, taxation on a loss.
3) Zero accountability for hostile tenants, who in effect can act with impunity.
4) Populist Govt who are determined to cap rental increases, now every 27 months.
5) Coming down the tracks, the populist Govt will determine by how much rents can be increased every 27 months.

It is unsustainable in the long term.... to expect a investor to get squeezed at the top, get squeezed at the bottom and carry the risk of lawless tenants.

Private Landlords will continue to leave the market.

The only landlords who will be left are the larger institutional investors, but they can ..

1) Pay a low corporation tax 12.5%.
2) Offset all their costs against taxation.
3) Shift profit to another location to pay a lower tax of 2%
4) Command Premium rents 1800 / 2000 euro a month, which they justify as they are providing a premium service.

But if a private Irish citizen decides to go into the rental market as a landlord, they will get punished. Or if they decide to go into savings, you will be heavily punished (40% DIRT tax).

<snip>

My prediction for the Irish rental market is that it will continue to get worse, more investors will leave than enter.

Renters will have to seek accommodation with the Institutional investor companies.... and accordingly pay high rents demanded.

athtrasna

Investments and markets forum can be found here http://touch.boards.ie/forum/859

4ensic15

handlemaster wrote: »

Good article today in the indo today . Its not on purpose on their be half. They are again trying to slam landlords as thats what sells papers in this country. But what they have actually showed is how LLs can actually make a profit in ireland.

http://m.independent.ie/irish-news/exposed-the-shocking-conditions-of-dublins-rental-accommodation-34711928.html

Pretty much the only way a profit can be made is through low standards and under the table dealing, this is if a table can be fitted in at all.

Shint0

4ensic15 wrote: »

Pretty much the only way a profit can be made is through low standards and under the table dealing, this is if a table can be fitted in at all.

So long as they comply with the minimum standards anything else is gravy...on the gravy train.