Residential tenancies bill 2016 proposals and discussion

Graham

Lizcent wrote: »

However the market rates in 2015 were not unreasonable for landlords.

You can't really state that as fact unless you know what the costs were for those landlords.

axcel

Graham wrote: »

You can't really state that as fact unless you know what the costs were for those landlords.

I'm not talking about those landlord tho, I'm talking about all landlords. As I said some people make a loss on investments, we can't raise prices forever until everyone is in profit. You've invested, you've taken a risk, it hasn't paid off rent wise, but you are still getting a large amount paid off your mortgage, you're still getting a return of sorts it's just not profit in your hands today. If you could guarantee that when people bought a house for rental that they'd cover all costs, and therefore have a free house in 30 years, everyone would be at it.

handlemaster

I think this has done great harm to future investors. Many I would imagine are now thinking what will the government do next to the now seen soft underbelly of landlords. This will mean less property for rent / been build higher rental prices again

Graham

handlemaster wrote: »

This will mean less property for rent / been build higher rental prices again

This is it.

All this is likely to do is shift some of the current rental stock into the homeowner market. Good for those that remain in a rent-capped property, not so good for anyone else.

Sad Professor

It would appear the 8% rise for tenants coming out of 2 year rent review is a mistake and is being corrected.

https://twitter.com/gavreilly/status/809480418676396032

4ensic15

Kapips88 wrote: »

I wonder how this could be challenged.
It does not apply to everyone equally.
And what they have done is punished landlords who have been nice to their tenants.
What they should have done is let everyone start at market rate.
Whats the story with 4 year part 4?
Gone I suppose, without giving a LL change to finish his existing part 4.
Who would invest in property now?

It could be challenged by way of a plenary action in the High Court.

beauf

Lizcent wrote: »

True, and there are these people out there. However the market rates in 2015 were not unreasonable for landlords. We can't keep increasing rates until every Landlord out there covers costs or is in profit. The reality is some people lose out on investments, and if your property is in negative equity that's a sh*te situation, I do feel for people like that but there has to be personal responsibility for the investment you made.

You want to cap profits but not losses. Why would you invest in that.

beauf

Lizcent wrote: »

I love this obsession with the market rate as if somehow people are making a loss by not charging this random rate. This rate has been set my landlords, and the supposed market rates that currently existing for some properties is actually obscene. But everytime there's an increase to a higher ridiculous rate, tenants find the money from somewhere or there's some desperate people/great earners who make the conscious decision to pay this rate. So somehow we get a new market rate and so on and so forth.

If you've been happy with the increase to date, you say you want to be this fair landlord and somehow now are panicking saying oh legislation is going to make me give this huge increase, why is legislation making you do that?? Because you'd already planned making increases bigger than 4% in the future? Mmm doesn't sound too fair to me.

What costs do you forsee coming in that will be higher than 4% each year? Because CPI isn't increasing by that much, wages aren't increasing by that much. If we go back to the oh existing costs are too high, well you could've increase in 2015 because nothings changed since then. Except what has changed is spiraling rents so lets be honest people just want to jump on the garvy train.

If the existing tenants leave. Why you would not to charge the market rate.

This change doesn't effect the existing tenants. It effects the rent you can set going forward.

axcel

beauf wrote: »

You want to cap profits but not losses. Why would you invest in that.

That's certainly not what I'm saying. If salaries and cpi was rising and that was the world we were living in, then yes rates obviously could and would keep increasing based on that. Profits in investements are inherently capped by whatever factor causes them to grow e.g markets, booms, interest rates.

Rents are at sky high price greater than during the boom and this isn't due to salaries, inflation, spending. It's down to supply. Supply can't be freed up overnight, if we are talking about building etc this takes time. If the government is smart they'd be looking at using this 3 year period to increase supply. People cannot keep affording the increases that are happening, more people are being made homeless all the time.
Second Point - We were talking about existing tenants and landlords who believe they were concerned about being fair to these people.

BTW yes I realise being a landlord is a business (chosen for some/accidental for others) It is not a charity but something had to be done by the Government. 4% increase each year for the next 3 years should be a good forecast on an investment for the majority of people.

Zzippy

Lizcent wrote: »

I love this obsession with the market rate as if somehow people are making a loss by not charging this random rate. This rate has been set my landlords, and the supposed market rates that currently existing for some properties is actually obscene. But everytime there's an increase to a higher ridiculous rate, tenants find the money from somewhere or there's some desperate people/great earners who make the conscious decision to pay this rate. So somehow we get a new market rate and so on and so forth.

The market rate is simply what someone is prepared to pay for a given property. That is set by demand, not by landlords. If landlords set the rate at a level they wanted rents would be even higher than they are. A large proportion of landlords are not even covering their costs, but they cannot raise the rent to a level that would, as they would not be able to get tenants at that level. Blame the lack of supply, not landlords, many of whom are barely keeping their heads above water. Who is responsible for the lack of supply? Not landlords...

beauf

It's a pity the govt can't cap car insurance or health insurance, or building costs, or variable mortgages theb way it can private rentals.

April 73

Regina Doherty TD was on Newstalk tonight saying that a currently rented property cannot have its rent raised to market rates even if the current tenants leave.
This has a welcome effect of stopping current tenants being pushed out to make way for a new tenancy & a higher rent.
However it also means that property currently let at below market rates can never reach market rate again & will be disadvantaged for years.

If the legislation means that coming out of Alan Kelly's two year freeze means that rents can only be raised by 4% at the end of the two years - it's going to upset LLs even more than when they though 8% was bad.

April 73

beauf wrote: »

It's a pity the govt can't cap car insurance or health insurance, or building costs, or variable mortgages theb way it can private rentals.

That would interfering in the market though. Couldn't have that!

quadrifoglio verde

April 73 wrote: »

Regina Doherty TD was on Newstalk tonight saying that a currently rented property cannot have its rent raised to market rates even if the current tenants leave.
This has a welcome effect of stopping current tenants being pushed out to make way for a new tenancy & a higher rent.
However it also means that property currently let at below market rates can never reach market rate again & will be disadvantaged for years.

If the legislation means that coming out of Alan Kelly's two year freeze means that rents can only be raised by 4% at the end of the two years - it's going to upset LLs even more than when they though 8% was bad.

Hmm, I can see key money being paid to get in the door. Is this banned for residential tenancy's?

How much renovation does one have to do to justify a new rate?

beauf

quadrifoglio verde wrote: »

Hmm, I can see key money being paid to get in the door. Is this banned for residential tenancy's?

How much renovation does one have to do to justify a new rate?

That's what happened in Berlin Afaik

utmbuilder

tenants before us 18 months ago where paying 950 , this is really great news for tenants, lots of celebrating in our household. Rent will go up from 1350 by 4% in June, some houses started asking 2000 recently. for small 3 beds.

Aemtler

Regina Doherty TD was on Newstalk tonight saying that a currently rented property cannot have its rent raised to market rates even if the current tenants leave.

How is this going to be enforced? Apart from the departing tenant, who knows what the existing rent was?.  If the landlord increases the rent to market rate for the new tenant and this is greater than 4% who is going to know? 

From RTB website, landlords only have to provide the following information. No mention of Rent.

http://www.rtb.ie/landlords/registering-a-tenancy-what-you-need-to-provide

The following information will be required by the PRTB in order to register a tenancy: 

• Rented Dwelling Address 
• Dwelling Type (i.e. Whole of House/Apartment/Flat Bedrooms, 
• Bedspaces & Number of Occupants 
• Approximate Floor Area in Square Metres 
• BER Cert Rating (if applicable) 
• Local Authority in which rented dwelling is located 
• Tenancy Commencement Date 
• Landlord name/address/ppsn 
• Tenant Name/ppsn 
• Authorised Agent (if applicable) Name/Address/CRO number/ppsn    
• Management Company (if applicable) Name/Address/CRO number

Pkiernan

This is going to make more people homeless.
Tenants paying less than market are in danger now.

The_Conductor

foggy_lad wrote: »

But don't the RPZs only last for three years? so after three years with a 12% raise in rent the landlords are back to normal.

Providing its not extended.........
Thats the knux though- its hard to not extend it- when its so populist to do just that.

As a temporary measure- it may squeak through the AG's office- however, as a permanent measure, it is a dilution of property rights enshrined in the constitution- and would require a referendum.

zl1whqvjs75cdy

The days of good tenants having a discount on market rates are going to end because of this I reckon. Why would future landlords risk getting stung by this sort of measure again? Short term it will slow the current rate of increase, but long term I'd say rents will be consistently higher.

April 73

Aemtler wrote: »

How is this going to be enforced? Apart from the departing tenant, who knows what the existing rent was?.  If the landlord increases the rent to market rate for the new tenant and this is greater than 4% who is going to know? 

From RTB website, landlords only have to provide the following information. No mention of Rent.

http://www.rtb.ie/landlords/registering-a-tenancy-what-you-need-to-provide

The following information will be required by the PRTB in order to register a tenancy: 

• Rented Dwelling Address 
• Dwelling Type (i.e. Whole of House/Apartment/Flat Bedrooms, 
• Bedspaces & Number of Occupants 
• Approximate Floor Area in Square Metres 
• BER Cert Rating (if applicable) 
• Local Authority in which rented dwelling is located 
• Tenancy Commencement Date 
• Landlord name/address/ppsn 
• Tenant Name/ppsn 
• Authorised Agent (if applicable) Name/Address/CRO number/ppsn    
• Management Company (if applicable) Name/Address/CRO number

I'd need to look at the form again. If you raise the rent on an existing tenancy you are "supposed" to inform the RTB. In reality I don't think that happens consistently.
To really enforce what Regina D said you'd need someone in the RTB to check every new tenancy against a previous one (if the two rents are provided) & doing something about it if the difference is more than 4%. It sounds unworkable in reality?

Nickindublin

If you cannot up the rent by more than 4% when there is a tenancy change this is going to have major implications for property values. For example 2 apartments for sale in a complex and both are identical. Apt A has an annual rent of 10000 Euro while Apt B has an annual rent of 12000. So for example let's say they are valued for investment of 10 years rent Apt B will be worth 20% more than Apt A.

The_Conductor

Pkiernan wrote: »

This is going to make more people homeless.
Tenants paying less than market are in danger now.

Big time- there has been absolutely no cognisance of the fact that there are large cohorts of landlords out there who for various reasons- including the fact that they like to keep a good tenant- have not brought rent up to market rates.

Personally- I'm chatting and trying to advise a girl who inherited a property in a nice location in Galway city. Its had the same tenant for over 4 years. She increased the rent once in that time frame to 750 Euro, and similar units in the duplex are being let now at 1,200. She was happy to leave the rent at 750- the tenant is happy with the property, communication between the landlord and tenant is at a minimum- which is what they're both happy with, any issues that have arisen- have been sorted promptly to their satisfaction etc etc. She currently pays over 50% tax on the rental income- as she inherited it, its not mortgaged, and its upkeep and repair is minimal.

Were she to increase the rent to market rates- I am certain the couple (who have an older child and a young baby) would be homeless- as frankly, they are not going to get even a much smaller property in the vicinity for what she is charging them.

She kept the property- as she has children myself- and both saw it as somewhere she would ultimately like to retire to herself- and when the time comes for her own children to go to college- it means she doesn't have to worry about accommodation- if she can persuade her little ones that university in Galway is their best option.

Now- she is quite honestly reassessing her options. She doesn't intend to increase rent to market rates for her tenants- but quite honestly- it doesn't make sense for her to hold onto the unit either. She would be better off selling- clearing her mortgage on her PPR- and keeping herself debt free so she can reassess her options in 15 years time- as she don't believe having a nice retirement home in Galway makes any sense whatsoever anymore.

I know she will probably be slated- as ultimately her tenants will have to find alternate accommodation- however, while she might have considered a long term tenancy previously- it simply doesn't make any sense at all anymore (wholly aside from the fact that she is paying over half the rental income to the tax man).

Landlords who don't charge the going rate- are a lot more common than people realise- and they are performing a social good. There are very often factors other than simply maximising one's rental income at play- most landlords have been burnt by at least one tenant at some stage- if you get good tenants, you are willing to put a price on having good tenants. Good tenants should be the norm, rather than the exception- however, for many landlords- they really have discovered just how valuable good tenants really are.

I can honestly see a lot of people who may have inherited a property, or moved elsewhere with work and let out their PPR etc- as seeing the current proposals as a shot across the bow- and together with the predictions of 18,000 new homes being built in 2017- assess the current environment as not being conducive to remaining in the industry- divesting, and most probably paying down debt. I honestly don't see what good this will do for anyone.

The knux of all of this- is the simple fact that the government through its policies abdicated its responsibility to provide housing to its people to the private sector- and to cap all of this- went on a spree of divesting itself of local authority housing stock, without replacing it.

Currently (and traditionally) landlords are held up as bogeymen- and are popular scapegoats for politicians.

Looking at some of the comments here and on the Journal in the last day or two- who would want to be a landlord? They're slated no matter what they do.

Politicians really have done the ultimate divide and conquer here.

There is sufficient pent-up demand for any landlord in any of the urban areas to sell their pre-existing property at close on 2005 prices- the current environment is quite simply the straw that is going to break the camels back for a lot of people who were reasonably happy to keep their heads down and keep going up to this point.

Having 40,000 units nationally hit the property market- will be great for prospective purchasers- however, unless the government somehow makes remaining in the sector attractive- it also means 40,000 fewer units nationally available to rent (presumably a large proportion of people currently renting would purchase given the opportunity- so its not to say 40,000 more people would be homeless- there would be upheavel though).

Its a mess- entirely of the government's own making.

Donal55

40000 landlords aren"t going to sell up.

pc7

What happens if you had already given notice of an increase (90 days) that's due to kick in in January?

pobber1

pc7 wrote: »

What happens if you had already given notice of an increase (90 days) that's due to kick in in January?

Current legislation applies.

The_Conductor

Donal55 wrote: »

40000 landlords aren"t going to sell up.

No they aren't. A sizeable number have already done so- and this is simply going to hasten the rush to the door. How many will ultimately decide its simply not worth their while- who knows........

Baby01032012

An even bigger blow for landlords came yesterday - it's not really 4% per annum. It's 4% after a 2 year freeze. Not only were they retrospectively applying the 4% but a landlord can not apply 4% per annum for the last 2 years that he wasn't allowed to give a rent increase.

Donal55

The_Conductor wrote: »

No they aren't. A sizeable number have already done so- and this is simply going to hasten the rush to the door. How many will ultimately decide its simply not worth their while- who knows........

According to Lorcan Sirr last week there was a 1400 net increase in the amount of landlords entering the market in the first 9 months of this year.

Sad Professor

Savills using census data rubbished these claims of fleeing landlords a couple of months ago. Landlords left, but have and are being replaced by cash rich investors with no where else to put their money. Even the IPOA who was falsely claiming this for the last year isn't saying it anymore.