How high will the rental rates go ?

Heisenberg.

This post has been deleted.

beauf

Johngoose wrote: »

Hopefully the government will bring in another measure to help the landlords...I mean tenants.The two year cap on rents worked a treat,every rent in the country skyrocketed over night.

The pressure for rent controls appeared to have come mainly from tenants. Despite all evidence to show rent controls don't work. The Govt bowed to popular opinion. You might argue the control wasn't more strict. But its likely that would have made the problem worse.

Regardless, studies of opinions held by economists still show a near universal consensus on the ineffectiveness of rent control, both first generation and second generation.[14][15] According to Gregory Mankiw [16] the statement, "A ceiling on rents reduces the quantity and quality of housing available" is believed by 93% of economists, and has the highest consensus rate on the survey. The Swedish economist Assar Lindbeck, a housing expert, says that "rent control appears to be the most efficient technique presently known to destroy a city – except for bombing".[17]

The issue is supply. More specifically the supply of rental property. Just because new property is built doesn't mean it will be rented out.

appfry

Johngoose wrote: »

Hopefully the government will bring in another measure to help the landlords...I mean tenants.The two year cap on rents worked a treat,every rent in the country skyrocketed over night.

A lot of landlords are scrambling again to inform people of rent increases at the earliest opportunity, given the noise from government the last few days about new even stricter handcuffs on landlords coming out in the next couple of months.

maninasia

It's a massive problem for people who would like to move back to Ireland.

The rate of rent increase is phenomenal. What with already high taxes, VAT and costs like health and car insurance the higher rent would make it very hard for us to live well, unless we moved outside of Dublin. Of course Dublin is where many of the jobs are and in other citie rents are getting higher as well. I've heard it's even difficult getting a place as a tenant never mind paying for it!

The problems fairly obvious, unnecessary planning restrictions limiting housing density and the height of new buildings.

It's the 21st century and Ireland's poplulation has been growing rapidly. The government is FAILING badly to adapt to modern Ireland.

4ensic15

Rent controls are already in place. They do not help the situation much if at all. Any more severe rent controls are likely to be unconstitutional. In any event, high rents are the symptom, not the cause, of the problem. When rents are rising it should be a trigger to increase supply. Rents have been rising for quite some time and all that has happened has been hand wringing and a few modular houses planned. The reality is that rents will keep going up until they are at levels last seen around 1980 as adjusted for inflation.

Baby01032012

4ensic15 wrote: »

Rent controls are already in place. They do not help the situation much if at all. Any more severe rent controls are likely to be unconstitutional. In any event, high rents are the symptom, not the cause, of the problem. When rents are rising it should be a trigger to increase supply. Rents have been rising for quite some time and all that has happened has been hand wringing and a few modular houses planned. The reality is that rents will keep going up until they are at levels last seen around 1980 as adjusted for inflation.

I'm not sure controlling the frequency of rent increases is actually a rent control. The increase still happens every 2 years instead of 1. And as such landlords have built in additional increase to deal with the 2 years. Rent control for me would be linking rate of increase to inflation or capping rate or amount.

I'm sure the government planned the 2 year freeze in hope supply would increase and rent levels would decrease in the meantime However this didn't happen.

beauf

Doesn't matter how you do it, it doesn't work.

I don't think it was hope. They were just pushing the issue down the line.

appfry

The real test will be what the government decide to do when the rules are up for their 4 year review.
Will they bury their heads and pretend it worked and extend it.
Or will they admit that it was a spectacular failure and reverse it and then stop meddling in future.

catrionanic

A tiny 2bed midterrace on our street in ranelagh, no garden, has just let for €2400

pilly

The ONLY thing that is going to stop rents rising is increased supply and the only way the government can create that is to either buy or build quickly. It is so simple and yet they seem to determined to try everything else first. If they had start building 5 years ago when this first became a problem there would be a much smaller issue now.

4ensic15

pilly wrote: »

The ONLY thing that is going to stop rents rising is increased supply and the only way the government can create that is to either buy or build quickly. It is so simple and yet they seem to determined to try everything else first. If they had start building 5 years ago when this first became a problem there would be a much smaller issue now.

It wasn't a problem 5 years ago.

http://www.boards.ie/vbulletin/showthread.php?p=79006148

beauf

They had stopped building social housing as well. Which just made it worse.

pilly

4ensic15 wrote: »

It wasn't a problem 5 years ago.

http://www.boards.ie/vbulletin/showthread.php?p=79006148

So there was no housing list 5 years ago? I think you'll find there was. The fact that people were finding private rented accommodation wasn't a long term solution and was never going to be.

Graham

pilly wrote: »

So there was no housing list 5 years ago? I think you'll find there was. The fact that people were finding private rented accommodation wasn't a long term solution and was never going to be.

While there are people occupying social housing that would no longer qualify for social housing, there will always be a housing list.

pilly

Graham wrote: »

While there are people occupying social housing that would no longer qualify for social housing, there will always be a housing list.

Agree there will always be a housing list but not one the size it is now.

Graham

pilly wrote: »

Agree there will always be a housing list but not one the size it is now.

You were referring to the housing list of 5 years ago. I'd hazard a guess it was still a significant size then.

The housing list isn't a particularly good indicator of the rental market or rental rates. It's always going to grow while it offers the opportunity for people to reduce their housing costs.

riclad

The government plan is to build 40,000 houses in the next 5 years ,this will reduce rents at some point or maybe stop them from rising in most area ,s .There seems to be alot of new student housing being built in dublin which will help a bit.

I'm not sure how the gov building social housing is going to have much of an impact on private renters. Ok their may be a little less competition but in general a lot of the places that rent is going up in are not places where people on RA etc are going to be renting.

Strong and more direct incentives to developers and builders are needed to get private housing going. Things like VAT reclaim on building of houses etc which will reduce the cost of building thus making it more profitable and encouraging building to start.

Banks also need to start lending properly to developers, yeah people will say look at the bust etc but people can't build without capital and many don't have it and those that do are not going to throw all their own money into it.

pilly

Stella Clever Strapless wrote: »

I'm not sure how the gov building social housing is going to have much of an impact on private renters. Ok their may be a little less competition but in general a lot of the places that rent is going up in are not places where people on RA etc are going to be renting.

Strong and more direct incentives to developers and builders are needed to get private housing going. Things like VAT reclaim on building of houses etc which will reduce the cost of building thus making it more profitable and encouraging building to start.

Banks also need to start lending properly to developers, yeah people will say look at the bust etc but people can't build without capital and many don't have it and those that do are not going to throw all their own money into it.

It will reduce the competition dramatically. I recently advertised a property and had at 80% of applicants on HAP, they can rent anywhere they want to you know, not particular areas and some people get €1550 per month under the new HAP scheme rules, this is absolutely driving rents sky high.

beauf

I don't think its limited to certain area's.

4.1 Rent Supplement.....There are currently approximately 70,000 households in receipt of this payment...

4.2 Rental Accommodation Scheme ....A total number of 51,757 cases were transferred from Rent Supplement to RAS from the first transfer in Q4 2005 to the end of December 2014 (DECLG 2015) .... Landlords are now beginning to pull out of the scheme and are not renewing contracts as they can get a higher rent return from private
tenant

...All of the above schemes are dependent on landlords engaging with the Department of the Environment, Community and Local Government (DECLG), the Department of Social Protection and tenants. Landlords however are reporting bureaucratic issues with all schemes and with no incentives to engage with the schemes as rents continue to rise, it is more attractive and profitable to remain in the open market.

4.4 Rent Supplement and HAP Limits The number of people in receipt of RS remains very high. Of the almost 90,000 households in 2013 assessed as having a housing need in 2013, 47% were in receipt of RS in private rented accommodation.

http://www.simon.ie/Portals/1/Reports/Locked-Out-of-the-Market.pdf

appfry

pilly wrote: »

It will reduce the competition dramatically. I recently advertised a property and had at 80% of applicants on HAP, they can rent anywhere they want to you know, not particular areas and some people get €1550 per month under the new HAP scheme rules, this is absolutely driving rents sky high.

The people in hotels will get the first social housing.

utmbuilder

when all these new houses arrived, with first time buyers only needing 10grand deposits, and mortgage rates rise those landlords might not be so comfortable not to mention advancements in Revenues automated auditing


look around they are building everywhere now, ever small bit of land is being broken since the budget

pilly

appfry wrote: »

The people in hotels will get the first social housing.

And your point is? That will also ease the pressure on the rental market as these people are also in competition for rented houses?

pilly

utmbuilder wrote: »

when all these new houses arrived, with first time buyers only needing 10grand deposits, and mortgage rates rise those landlords might not be so comfortable not to mention advancements in Revenues automated auditing


look around they are building everywhere now, ever small bit of land is being broken since the budget

I'm confused?

Graham

pilly wrote: »

I'm confused?

From that post I'd infer the poster thinks:

the housing shortage is about to be solved
all first time buyers are going to get a house
interest rates are going to jump
landlords are going to get caught by revenues auditing robot

Not sure there's much evidence to support the theories.

pilly

Graham wrote: »

From that post I'd infer the poster thinks:

the housing shortage is about to be solved
all first time buyers are going to get a house
interest rates are going to jump
landlords are going to get caught by revenues auditing robot

Not sure there's much evidence to support the theories.

Thanks for clearing that up! I haven't noticed new builds going up all over the place.

Graham

pilly wrote: »

I haven't noticed new builds going up all over the place.

Me either although I wouldn't be surprised to see a slight bump in new build starts when the official figures come out.

beauf

Graham wrote: »

From that post I'd infer the poster thinks:

the housing shortage is about to be solved
all first time buyers are going to get a house
interest rates are going to jump
landlords are going to get caught by revenues auditing robot

Not sure there's much evidence to support the theories.

You missed

... that all LL are avoiding tax...

... making it less "uncomfortable" for LL's will increase the number of rental properties for renters.

draiochtanois

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riclad

High rents are driving up wages and house prices .We are competing with
eu countrys poland,germany with lower rents .
if rents get too high companys will be stop investing here .
There was storys on the radio about the poor gardai,
who cant afford to buy a house in dublin.
So are all wages in ireland going to be based on the cost of a 3bed house in dublin ,even though you can buy a house in longford for 60k.