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Phasing in rent increase

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    #62
    spacetweek
    Moderators, Science, Health & Environment Moderators Posts: 5,054 Mod ✭✭✭✭spacetweek


    <mod snip>
    Housing is a commodity on a completely different scale to any other. Have your computer or car taken off you, you can get by. Your house is your shelter and it is worthy of a greater level of protection than anything else.


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    #63
    Graham
    Moderators, Society & Culture Moderators Posts: 17,642 Mod ✭✭✭✭Graham


    spacetweek wrote: »
    Your house is your shelter and it is worthy of a greater level of protection than anything else.

    Nobody said otherwise. It is your implication that the landlord should finance the greater level of protection that some posters are taking issue with.


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    #64
    beauf
    Closed Accounts Posts: 22,648 ✭✭✭✭beauf


    spacetweek wrote: »
    ...We need proper fixity of tenure - no effect on tenants when house is bought/sold/repossessed, no eviction for family/sale/renovation reasons, and rent controls. If rent controls don't work why are they so widespread, even in America which is the bastion of free-market capitalism?

    If increasing supply is all that's needed to bring rents down then why were rents rising so rapidly during the boom years when there was massive oversupply of housing.

    US has https://en.wikipedia.org/wiki/Ellis_Act

    We have rent control. You can only increase it once in 2yrs, and you can only match the market rate.

    Has it brought prices down?


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    #65
    beauf
    Closed Accounts Posts: 22,648 ✭✭✭✭beauf


    spacetweek wrote: »
    ...Your house is your shelter and it is worthy of a greater level of protection than anything else.

    It does, and it has.

    But if you want to increase supply. The LL (big or small) needs some protection. At the moment they have none. Otherwise they won't invest in that market.


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    #66
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,285 Mod ✭✭✭✭The_Conductor


    Deleted User wrote: »
    What are you on about?

    Of course market rate is set by landlords.

    Tenants aren't going around saying, "Hmmm... I see this apartment is 1,200 a month. I'll give you 1,500."


    The whole thing has gone crazy.

    950 up to 1,800. Can you imagine a lone parent trying to pay that?

    Crazy.

    I've helped a colleague let a property in Lucan in the last few days. She had over 50 enquiries within 4 hours of putting the property up on Daft- which she whittled down to 20 interested parties who turned up for an open viewing the following day and evening- of whom 14 offered more than the price on Daft- one, a consultant in the Hermitage, who wants to bring his family over, but has been having difficulty finding somewhere suitable- offered double the asking price- and 6 months rent upfront to Cathy. She was shocked- but took it........


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    #67
    handlemaster
    Registered Users Posts: 6,003 ✭✭✭handlemaster


    The_Conductor wrote: »
    I've helped a colleague let a property in Lucan in the last few days. She had over 50 enquiries within 4 hours of putting the property up on Daft- which she whittled down to 20 interested parties who turned up for an open viewing the following day and evening- of whom 14 offered more than the price on Daft- one, a consultant in the Hermitage, who wants to bring his family over, but has been having difficulty finding somewhere suitable- offered double the asking price- and 6 months rent upfront to Cathy. She was shocked- but took it........

    Nice one Cathy. Hope it doesnt tun out to a hash grow house


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    #68
    JP 1800
    Registered Users Posts: 336 ✭✭JP 1800


    The_Conductor wrote: »
    I've helped a colleague let a property in Lucan in the last few days. She had over 50 enquiries within 4 hours of putting the property up on Daft- which she whittled down to 20 interested parties who turned up for an open viewing the following day and evening- of whom 14 offered more than the price on Daft- one, a consultant in the Hermitage, who wants to bring his family over, but has been having difficulty finding somewhere suitable- offered double the asking price- and 6 months rent upfront to Cathy. She was shocked- but took it........

    This country has gone mad again. it just shows the desperation out there at the moment, how long can it last?.


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    #69
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,285 Mod ✭✭✭✭The_Conductor


    JP 1800 wrote: »
    This country has gone mad again. it just shows the desperation out there at the moment, how long can it last?.

    If construction doesn't ramp up to meet demand in a sustainable manner- prices can only go in the one direction........ Thats why the first time buyer grant is only for new builds- its to try and encourage an increase in our housing stock- the fact that its packaged as a pressie for first-time-buyers, is neither here nor there (and indeed, by the Minister's own admission- there are other classes of owners out there who deserve help every bit as much- or even more).


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    #70
    Sad Professor
    Moderators, Category Moderators, Arts Moderators, Entertainment Moderators, Technology & Internet Moderators Posts: 22,677 CMod ✭✭✭✭Sad Professor


    JP 1800 wrote: »
    This country has gone mad again. it just shows the desperation out there at the moment, how long can it last?.

    There’s a ceiling in terms of what people can afford to pay, but the impression I get from landlord lobby is that they think there’s enough high earners renting but unable to buy to absorb the current rate of rent increases for several years to come. I don’t think the government’s supply-side subsidies will work in the short-term, if at all, so rents will probably continue to rise until the state intervenes. The question is whether the rent crisis has become bad enough for them to do so yet, and I don’t think it has. How long have we had a “health crisis” now? At a certain point you have to accept that it’s not a crisis, it’s policy.

    Ireland is somewhat unusual in not having a tenant’s union and I suppose you could see a very radicalised tenant movement appear very quickly if rents continue to spiral out of control. I don’t think that’s likely, though, as it would require young people to get involved on a very large scale and if there’s one thing we teach our young people in Ireland it’s that when the going gets tough… you emigrate.


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    #71
    [Deleted User]
    Posts: 24,714 ✭ [Deleted User]


    spacetweek wrote: »
    Housing is a commodity on a completely different scale to any other. Have your computer or car taken off you, you can get by. Your house is your shelter and it is worthy of a greater level of protection than anything else.

    Then buy your own house rather than try to introduce crazy laws to stop people operating the rental business in the houses they own as they see fit.


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    #72
    [Deleted User]
    Posts: 11,614 ✭✭✭✭ [Deleted User]


    beauf wrote: »
    US has https://en.wikipedia.org/wiki/Ellis_Act

    We have rent control. You can only increase it once in 2yrs, and you can only match the market rate.

    Has it brought prices down?

    2 weeks after the legislation came in stating that you can only up the rent every two years, my rent went up by 10%. And the new rent was for the following month, not the 90 days notice that the legislation stated. When I queried it I was told "Don't like it? Move."

    Did it bring prices down? No. Mine went up. And when we do move, I bet they'll ask for even more, putting the price up further.


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    #73
    Graham
    Moderators, Society & Culture Moderators Posts: 17,642 Mod ✭✭✭✭Graham


    Deleted User wrote: »
    2 weeks after the legislation came in stating that you can only up the rent every two years, my rent went up by 10%. And the new rent was for the following month, not the 90 days notice that the legislation stated. When I queried it I was told "Don't like it? Move."

    You accepted that and paid up?


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    #74
    [Deleted User]
    Posts: 11,614 ✭✭✭✭ [Deleted User]


    Graham wrote: »
    You accepted that and paid up?

    What would you suggest I do?

    I did request a new bed(as it was f&%ked), a new microwave as it didnt work, and new couch (as it was f&%ked too). The client(actual landlord) shelled out about a grand in one month so it'll be next July until her rent increase actually benefits her.


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    #75
    Clampdown
    Closed Accounts Posts: 423 ✭✭Clampdown


    I would love to move to Dublin but one quick look at the threads on renting there puts the idea to bed. Every renter there must live in constant fear of an increase, if they haven't already got one, in which case they have to hope they get a pay raise within the next two years to put toward the next one.

    And no matter where you are renting, any time you hear 'my son is taking over the property', it's time to start packing.

    OP what will you do if the tenants tell you they can't afford the proposed increase?


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    #76
    Graham
    Moderators, Society & Culture Moderators Posts: 17,642 Mod ✭✭✭✭Graham


    Deleted User wrote: »
    What would you suggest I do?

    Register a dispute with the RTB to enforce your rights.


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    #77
    Ashbx
    Registered Users Posts: 750 ✭✭✭Ashbx


    Graham wrote: »
    Does that work the other way too?

    If the market rent isn't enough to cover the mortgage would you be ok with paying more than the market rate or would you "sense an opportunity to bleed a bit more cash from your tenants landlord?

    Yes absolutely. My landlord increased my rent a couple of years ago because his mortgage payments increased. Absolutely no problem and completely understandable from my end. But my landlord increased by €100 a month...not €1k a month!

    ted1 wrote: »
    A landlord is running a private business with the intent of maximum return. He can raise it to what the market can bear.

    Private landlords should t be providing social housing, that's the job of the state.

    Either buy your own house or you'll have to pay what the market rate is.


    I never said they couldn't raise it and certainly never mentioned or implied anything about social housing so please don't mince my words. I am just saying to the OP to be prepared that their current tenants may not be willing to pay that so the landlord will need to be prepared to fund the cost to get new tenants (cleaning fees, returning deposit, estate agent fees, new furniture/facilities to the house, possible months of house being vacant etc).

    Just giving my opinion that if it was me, I wouldn't stay in the house. Not out of spite but because I couldn't afford it! Just my two cents!

    And I will refrain from elaborating on your "just buy a house" comment....jeez if it were that easy everyone would own their own property!

    rubadub wrote: »
    its 100% as said a few times. Are you both suggesting they will leave to go to a smaller place? cheaper area? or that they would leave out of spite and pay the same 100% increased rate in a similar place, which would cause them major disruption to themselves. Or have you simply not thought it through.

    If anything rather than leaving out of spite they more logically would stay loyal to the landlord who has been giving them such an easy ride for years, rather than leave and move into an identical place next door paying the new landlord the very same price that is being asked now. But I suppose many would not be rational about it, and could have this knee jerk reaction.

    No jeez no, not out of spite. Because of the fact that I simply wouldn't be able to afford to live there anymore. Unfortunately, I would have to downsize or move to another cheaper area.
    CiboC wrote: »
    OP here, well that didn't take long...!

    There is still a loan outstanding and although the rent hasn't increased the same cannot be said for property taxes and service charges. My father is entitled to a fair return on his investment, no?


    Thanks for all the replies, some of which were even helpful...

    By all means if it has to be done, then go for it. You didn't make it clear in your initial post that there was loans outstanding etc hence why I asked. All I was saying was if you are going to increase it (to the full amount especially) to be prepared that your current tenants may not be able to pay that price. If it was me, I wouldn't be able to afford it and you would therefore be losing me as a tenant so its a possibility your tenants will do the same. It is something that needs to be considered because judging by your initial post, you seem to be assuming that your tenants will have no issue with this whether its gradual or all in one go, it may not go the way you are hoping it will.

    Just my two cents....whether you deem it "helpful" or not.


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    #78
    conf101
    Registered Users Posts: 1,037 ✭✭✭conf101


    The_Conductor wrote: »
    I've helped a colleague let a property in Lucan in the last few days. She had over 50 enquiries within 4 hours of putting the property up on Daft- which she whittled down to 20 interested parties who turned up for an open viewing the following day and evening- of whom 14 offered more than the price on Daft- one, a consultant in the Hermitage, who wants to bring his family over, but has been having difficulty finding somewhere suitable- offered double the asking price- and 6 months rent upfront to Cathy. She was shocked- but took it........

    As a tenant and someone who has had to move recently when my landlord wanted to sell my apartment I really despair when I hear stories like this. The way renting in Dublin is going at the moment is genuinely frightening and the absolute lack of supply means things aren't going to turn around for a long time.

    I really hope I can buy soon because I'm scared about my ability to keep renting in this crazy market.


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    #79
    [Deleted User]
    Posts: 17,728 ✭✭✭✭ [Deleted User]


    Deleted User wrote: »
    Ill be flamed for this, but this thread is proving to me why we need rent control in Dublin. Uneducated, unprofessional landlords causing ridiculous rising rents, policed only by market rate. Aka each other.

    Did you have that sentiment in recessionary times when rent control would have prevented prices dropping?


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    #80
    Claw Hammer
    Registered Users Posts: 6,236 ✭✭✭Claw Hammer


    Augeo wrote: »
    Did you have that sentiment in recessionary times when rent control would have prevented prices dropping?

    Rent control would not prevent price dropping. Tenants would leave if they could get a better deal elsewhere. They would not be locked into paying above the odds,


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    #81
    [Deleted User]
    Posts: 17,728 ✭✭✭✭ [Deleted User]


    Claw Hammer wrote: »
    Rent control would not prevent price dropping. Tenants would leave if they could get a better deal elsewhere. They would not be locked into paying above the odds,


    So rent control is only "called for" when market rates rise. When it suits tenants in other words.

    The market controls the price, not the landlords. Supply and demand.


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    #82
    runawaybishop
    Registered Users Posts: 9,504 ✭✭✭runawaybishop


    Claw Hammer wrote: »
    Rent control would not prevent price dropping. Tenants would leave if they could get a better deal elsewhere. They would not be locked into paying above the odds,

    A very attractive market for landlords indeed. That could only help supply.


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    #83
    spacetweek
    Moderators, Science, Health & Environment Moderators Posts: 5,054 Mod ✭✭✭✭spacetweek


    A lot of people still saying "Just buy a house if you don't like it." Getting and maintaining a mortgage is a huge amount of responsibility and commitment. Most Irish people only buy a house because they know well that you've no security of tenure and are subject to arbitrary price increases all the time if you rent. It's really questionable whether mass home ownership is a good thing at all.
    The_Conductor wrote: »
    one, a consultant in the Hermitage, who wants to bring his family over, but has been having difficulty finding somewhere suitable- offered double the asking price- and 6 months rent upfront to Cathy. She was shocked- but took it........
    She should not have taken it. Her next tenant won't be able to afford double the asking price so the bar has been raised too high. I seriously think it should be illegal to pay double the asking price - doctors can just price everybody else out.
    beauf wrote: »
    We have rent control. You can only increase it once in 2yrs, and you can only match the market rate.
    Hahaha. That is not rent control. This just means landlords increase the rent 2 years' worth every 2 years instead of 1 year's worth every year. And there is no such thing as the market rate, as we've established a few times now. The market rate is just whatever other landlords are charging.


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    #84
    Sad Professor
    Moderators, Category Moderators, Arts Moderators, Entertainment Moderators, Technology & Internet Moderators Posts: 22,677 CMod ✭✭✭✭Sad Professor


    Tenants moving to avail of falling prices seems unlikely. Since rent regulation would only apply to ongoing tenancies, the market rent would have to drop pretty dramatically in a very short space of time for it to be cheaper than the regulated rent for existing tenants. The bigger issue for rent regulation would probably be unscrupulous landlords evicting tenants so they can charge new tenants the full market rate, i.e. what's already going on since the introduction of the 2 year rent review clause. This is why security of tenure would have to go hand in hand with rent certainty.


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    #85
    hytrogen
    Registered Users Posts: 952 ✭✭✭hytrogen


    CiboC wrote:
    I have recently taken over management of my father's rental property, he is getting on a bit and it was getting too much hassle for him at his age.

    CiboC wrote:
    I don't want to be completely unreasonable and put the rent up to market level in one fell swoop, but on the other hand there is no way of increasing it more gradually now that there is a 2 year review limit.

    Imao if I were you, I'd sit down and make a full business plan and assessment of the property, see how much outlay you need for general upkeep, legal fees rtb reg, out goings of mortgage etc. All the expenses to run it as a business.
    Then compare the results with your aul fellas plan, books and see if you actually need to up the rates. Most likely if he's had the property for some time he'll have a big chunk of the mortgage paid off and it'll probably be at a much lower rate to the neighbouring properties if they were purchased more recently..
    Finally double check the local rates again for comparison and see do you actually need to increase up to them. I'm only estimating from my own personal experience in a similar matter not so long ago.
    As long as there's enough in the kitty to cover the unexpected departure of your tenant after this justified review until a new one comes along then you should be in a good position to assume running the business.


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    #86
    ZeroThreat
    Registered Users Posts: 2,191 ✭✭✭ZeroThreat


    spacetweek wrote: »
    To even contemplate a 50% increase in a single rent review is all the evidence you need that we must introduce rent controls in this country, or at least in areas where rent is already high.

    Seems to me like the tenants have been taking advantage of the lack of business acumen of an old man, so it's either pay up, or move please.


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    #87
    [Deleted User]
    Posts: 24,714 ✭ [Deleted User]


    hytrogen wrote: »
    CiboC wrote:
    I have recently taken over management of my father's rental property, he is getting on a bit and it was getting too much hassle for him at his age.

    CiboC wrote:
    I don't want to be completely unreasonable and put the rent up to market level in one fell swoop, but on the other hand there is no way of increasing it more gradually now that there is a 2 year review limit.

    Imao if I were you, I'd sit down and make a full business plan and assessment of the property, see how much outlay you need for general upkeep, legal fees rtb reg, out goings of mortgage etc. All the expenses to run it as a business.
    Then compare the results with your aul fellas plan, books and see if you actually need to up the rates. Most likely if he's had the property for some time he'll have a big chunk of the mortgage paid off and it'll probably be at a much lower rate to the neighbouring properties if they were purchased more recently..
    Finally double check the local rates again for comparison and see do you actually need to increase up to them. I'm only estimating from my own personal experience in a similar matter not so long ago.
    As long as there's enough in the kitty to cover the unexpected departure of your tenant after this justified review until a new one comes along then you should be in a good position to assume running the business.
    hytrogen wrote: »
    CiboC wrote:
    I have recently taken over management of my father's rental property, he is getting on a bit and it was getting too much hassle for him at his age.

    CiboC wrote:
    I don't want to be completely unreasonable and put the rent up to market level in one fell swoop, but on the other hand there is no way of increasing it more gradually now that there is a 2 year review limit.

    Imao if I were you, I'd sit down and make a full business plan and assessment of the property, see how much outlay you need for general upkeep, legal fees rtb reg, out goings of mortgage etc. All the expenses to run it as a business.
    Then compare the results with your aul fellas plan, books and see if you actually need to up the rates. Most likely if he's had the property for some time he'll have a big chunk of the mortgage paid off and it'll probably be at a much lower rate to the neighbouring properties if they were purchased more recently..
    Finally double check the local rates again for comparison and see do you actually need to increase up to them. I'm only estimating from my own personal experience in a similar matter not so long ago.
    As long as there's enough in the kitty to cover the unexpected departure of your tenant after this justified review until a new one comes along then you should be in a good position to assume running the business.

    What planet are you living in, the op has indicated he can get about 900 euro more per month than he is. Even at 50% tax that 450 euro a month more, would you turn now a net 450 euro per month pay increase? You would in your arse.

    The rental market is mad, if the current tenant pays they make a lot more per month, if they leave they will have someone in immediately in the current climate more than likely above the market rate. They obviously don't waste their money on agents etc as they look after it themselves so people talking about agents fees are talking nonsense.

    It's a business and there are a lot of people here who should stay far far away from running a business judging by the comments as it's would be a massive flop.


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    #88
    ZeroThreat
    Registered Users Posts: 2,191 ✭✭✭ZeroThreat


    Landyn Raspy Traveller wrote: »
    What planet are you living in, the op has indicated he can get about 900 euro more per month than he is. Even at 50% tax that 450 euro a month more, would you turn now a net 450 euro per month pay increase? You would in your arse.

    The rental market is mad, if the current tenant pays they make a lot more per month, if they leave they will have someone in immediately in the current climate more than likely above the market rate. They obviously don't waste their money on agents etc as they look after it themselves so people talking about agents fees are talking nonsense.

    It's a business and there are a lot of people here who should stay far far away from running a business judging by the comments as it's would be a massive flop.

    If we were in a world where it was legally possible, I'd be trying to charge them extra retrospectively to compensate for all those years when they were paying ridiculously low rates. :D


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    #89
    davindub
    Registered Users Posts: 1,447 ✭✭✭davindub


    Augeo wrote: »
    So rent control is only "called for" when market rates rise. When it suits tenants in other words.

    The market controls the price, not the landlords. Supply and demand.
    Perhaps you might re-evaluate your perception of "market"...

    If the government removed all the restrictions that prevent the development of houses by persons other than disinterested bigger developers, landlords would be facing ruin. Thats a real market, you compete either on price or value or you go bust. I'm not saying we go as far as that, but government rent controls are necessary to mitigate the damage other policies have created and I hope they put them in place.


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    #90
    DivingDuck
    Registered Users Posts: 1,396 ✭✭✭DivingDuck


    spacetweek wrote: »
    A lot of people still saying "Just buy a house if you don't like it." Getting and maintaining a mortgage is a huge amount of responsibility and commitment.

    Absolutely true.

    This is why tenants do and should pay a premium to landlords for doing it. It's why it's fair for rents to be higher than mortgage repayments, and why landlords deserve to make a profit on houses they own and rent out.


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    #91
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,285 Mod ✭✭✭✭The_Conductor


    conf101 wrote: »
    As a tenant and someone who has had to move recently when my landlord wanted to sell my apartment I really despair when I hear stories like this. The way renting in Dublin is going at the moment is genuinely frightening and the absolute lack of supply means things aren't going to turn around for a long time.

    I really hope I can buy soon because I'm scared about my ability to keep renting in this crazy market.

    I really hear what you're saying.
    The problem is- supply in the rental sector- is actually falling- and supply of properties for sale- is stalled at low levels.
    Until such time as supply side issues change (and this includes making letting property more attractive for landlords- but also opening up large quantities of purpose built properties built solely for the letting market to all tenants and not just social welfare recipients)- we're going to remain in a whole lot of hot water.

    The current market and the wider political and financial considerations- suit no-one aside from the Revenue Commissioners and the Banks. Politicians have successfully played off tenants against landlords- to deflect attention from their own gross failures- and unfortunately- they have gotten away with it.

    The new Minister for Housing has to be held to account for the state of the market- and I'm really sorry but the First Time Buyers scheme is just another bit of vapourware- all that creates is extra demand for a static number of properties- and more anguish and angst amongst both property owners, prospective property owners- and those who rent.

    Its a never ending circle.

    The most recent international studies for the REITs which they are using to drum up funds for further Irish residential property purchases- suggest a further annual increase of up to 27% over the next 12 months. I fail to see how anyone in the market is served by such a proposition.


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