Is the end of the road for landlords coming ?

listermint

Claw Hammer wrote: »

Even without S23 he put zero in and now has an asset and income.

There's many on here that don't want that being as obvious. It's all gloom and doom etc etc yet they stay on the game....

Post office indeed

beauf

listermint wrote: »

There's many on here that don't want that being as obvious. It's all gloom and doom etc etc yet they stay on the game....

Maybe they should re-invest back in 97.

newacc2015

davindub wrote: »

There is absolutely nothing stopping any LL from paying 12.5% on top of income tax of dividends/ salaries they receive from the company they have set up if they wish. Same as for all companies.

There is though. Banks generally don't allow LTD companies to buy residential property. I know dozens of landlords with hundreds of properties. Not a single one has a LTD company for their properties. It is not the norm in Ireland. If you have a property and put it into a LTD company, you have to pay CGT on the appreciation if there is any.

If you are a dodgy vulture fund, the state has zero issue with you exploiting loopholes in our tax laws to set up a fund to buy Irish property at distressed prices to rent tax free. Certain investment banks have no issue levering these funds

You average joe doesnt not have means to exploit our tax laws and use German investment banks to buy property like you are saying is possible

Graham

newacc2015 wrote: »

Banks generally don't allow LTD companies to buy residential property.

Source?

listermint

beauf wrote: »

Maybe they should re-invest back in 97.

Maybe they should.....

Kevvv

newacc2015 wrote: »

There is though. Banks generally don't allow LTD companies to buy residential property. I know dozens of landlords with hundreds of properties. Not a single one has a LTD company for their properties. It is not the norm in Ireland. If you have a property and put it into a LTD company, you have to pay CGT on the appreciation if there is any.

If you are a dodgy vulture fund, the state has zero issue with you exploiting loopholes in our tax laws to set up a fund to buy Irish property at distressed prices to rent tax free. Certain investment banks have no issue levering these funds

You average joe doesnt not have means to exploit our tax laws and use German investment banks to buy property like you are saying is possible

"Dodgy vulture funds" and many other funds and/ or investors have typically invested in Irish property through a S.110 company. These have been established for 25 years with little tax paid by them. It's nothing new.

newacc2015

Graham wrote: »

Source?

Call any Irish bank. They just wont do it. I tried doing it last year and not a single one was willing to do it.

odonovanconor

Ethan Rough Saber wrote: »

The current levels of taxation on rental income are not sustainable. Either there needs to be an increase in allowable expenses or a reduction in the rate of tax (a flat rate of tax on rental income rather than it being taxed at your marginal rate for instance).

Or is it that the current level of borrowing for btl's is too high?

newacc2015

Kevvv wrote: »

"Dodgy vulture funds" and many other funds and/ or investors have typically invested in Irish property through a S.110 company. These have been established for 25 years with little tax paid by them. It's nothing new.

They were actually established in 1997. It was possible to do it back then, but they were not commonly used until recently. With all the developers and property owners going under, I have only heard of one of them holding their property within one of these funds. They are not new, they were just not used.

S110 were set up to help international firms manage international investments out of the IFSC without double taxation. They were never intended to be used for helping dodgy private equity firms to buy up distressed assets in Ireland and avoid tax in Ireland.

davindub

newacc2015 wrote: »

There is though. Banks generally don't allow LTD companies to buy residential property. I know dozens of landlords with hundreds of properties. Not a single one has a LTD company for their properties. It is not the norm in Ireland. If you have a property and put it into a LTD company, you have to pay CGT on the appreciation if there is any.

If you are a dodgy vulture fund, the state has zero issue with you exploiting loopholes in our tax laws to set up a fund to buy Irish property at distressed prices to rent tax free. Certain investment banks have no issue levering these funds

You average joe doesnt not have means to exploit our tax laws and use German investment banks to buy property like you are saying is possible

Its not a blanket recommendation to set up a LTD if you own a property, it will suit some investors, others it won't. It was a reply to another poster claiming that LL's should pay the same tax as companies.

But for some investors it could suit, 12.5% on income and 33% cgt but for most people it is an income so their annual tax would be 12.5% + income taxes...increasing the annual tax bill overall.

But the option is there to set up a LTD company. The funds you are referring to abuse a charitable status, i think the government is closing that loophole, they didn't pay any pocket money to anyone..

Baby01032012

Anyone see the news headline this morning that Simon covney is bringing proposals to cabinet today for rent controls in specific areas, initially dublin and cork. This will limit how much landlords can increase rents by and how often. It's proposed as s temporary measure.

The_Conductor

Baby01032012 wrote: »

Anyone see the news headline this morning that Simon covney is bringing proposals to cabinet today for rent controls in specific areas, initially dublin and cork. This will limit how much landlords can increase rents by and how often. It's proposed as s temporary measure.

Its the lead story in today's Irish Times.
In brief- the Minister is proposing a rent increase cap of 4% per annum for Dublin and Cork (with the probability of adding Galway and Waterford to this).
Its for rent reviews only- aka for new tenancies- a landlord could go with the market rates.

Its a sad inditement of the Ministers failure to come up with proposals to increase supply in our areas of highest demand- and instead to focus on price controls.

We need more supply- we do not need stupid price controls- we need supply- proposals like this won't do anything whatsoever, other than piss people off. You're still going to have queues of people to viewings of property which come on the rental market- and the person who offers the year's rent in advance, or some such similar type inducement to the landlord, will get the property.

I honestly hope the proposal gets knocked down- and not because I want rents to rise- because I hope the Minister gets a boot up the rear and gets told to come up with concrete proposals to boost supply asap.

While I can see there will be a small cohort of interested parties on the sidelines who might think this is a good idea- once again it'll be the law of unintended consequences- and for larger landlords such as the REITs- it will simply become the norm to end every single tenancy after 4 years- and relet at the prevailing open market rate to a new tenant (and they will get this too- such is demand).

The key to unlocking our soaring rents- is to massively increase supply- it is not to bring in price controls by the back door.

If the Minister came up with a scheme to abolish the height restrictions in Cork and Dublin- simultaneously specifying reasonable and realistic apartment sizes, with parking and storage- I'd be lauding him. This proposal- is a poor sticking plaster that achieves nothing whatsoever in the medium term- other than more uncertainty for tenants.

The_Conductor

Wanderer78 wrote: »

Are fg finally admitting free market economic policies are a load of horse****?

Free market economics- would mean supply was allowed to rise- until an equilibrium was reached where supply matched demand, and rents were reasonable for each demographic group. Instead- they are crippling supply- and through taxation policy- are making it impossible for the majority of our construction workers who emigrated during the downturn- to return and work here again.

Freeing up construction- but specifying reasonable dwelling sizes and dictating that external storage and parking *has* to be supplied with each dwelling unit- simultaneously abolishing height restrictions- but applying reasonable capital costs (via an enforced social housing provision)- is the way to go. The Minister doesn't have the balls to do this.

Wanderer78

The_Conductor wrote:

Free market economics- would mean supply was allowed to rise- until an equilibrium was reached where supply matched demand, and rents were reasonable for each demographic group. Instead- they are crippling supply- and through taxation policy- are making it impossible for the majority of our construction workers who emigrated during the downturn- to return and work here again.

The market knows **** in my eyes, the eu is in bits because of it and may very well crumble, eventually. It's been cleared obvious for years now that the government was needed to step in to solve this disturbing problem by simply building houses but they have become blinded by the precious market. Better luck next time eu!

The_Conductor

The_Conductor wrote: »

The issue for a lot of people who do have a small lumpsum to invest- is a lack of viable alternates- there quite simply aren't the range of investment opportunities that normally one would expect...............

Folks not seeing what's offered on the stock & bond markets as viable is puzzling IMO

newacc2015

newacc2015 wrote: »

Call any Irish bank. They just wont do it. I tried doing it last year and not a single one was willing to do it.

So not a single bank was willing to lend your Ltd company money to buy property?

That's a tad different to what you are claiming.

Barely Hedged

Baby01032012 wrote: »

Anyone see the news headline this morning that Simon covney is bringing proposals to cabinet today for rent controls in specific areas, initially dublin and cork. This will limit how much landlords can increase rents by and how often. It's proposed as s temporary measure.

There is nothing more permanent than a temporary government measure

Barely Hedged

Augeo wrote: »

Folks not seeing what's offered on the stock & bond markets as viable is puzzling IMO

A lot of people who work in rates and equities trading, have the majority of their investment portfolio in property...

Barely Hedged

Barely Hedged wrote: »

A lot of people who work in rates and equities trading, have the majority of their investment portfolio in property...

Define "a lot" quantitatively please?

Where traders invest wouldn't be a huge indicator for me tbh.

beauf

Baby01032012 wrote: »

Anyone see the news headline this morning that Simon covney is bringing proposals to cabinet today for rent controls in specific areas, initially dublin and cork. This will limit how much landlords can increase rents by and how often. It's proposed as s temporary measure.

None of it works. you need affordable supply. Especially for social housing.

Law on Social Housing in Berlin (housing law Berlin - WoG Bln)


http://www.tagesspiegel.de/berlin/neues-wohnraumgesetz-fuer-berlin-senat-will-30-000-neue-sozialwohnungen-foerdern/12578902.html

https://www.berlin.de/rbmskzl/aktuelles/pressemitteilungen/2015/pressemitteilung.364922.php

http://www.thelocal.de/20160503/100s-of-flats-still-available-after-berlins-airbnb-ban

Barely Hedged

Augeo wrote: »

Define "a lot" quantitatively please?

Where traders invest wouldn't be a huge indicator for me tbh.

Everybody on my desk has property(ies).

Talking to people on other desks about personal trading and nearly everybody over 30 has property as their major investment allocation.

We read analyst reports, have instant access to market data and news and talk to brokers all day. Who do you suggest would be a better indicator for rates and equities?

Fian

The_Conductor wrote: »

.....<snip>

While I can see there will be a small cohort of interested parties on the sidelines who might think this is a good idea- once again it'll be the law of unintended consequences- and for larger landlords such as the REITs- it will simply become the norm to end every single tenancy after 4 years- and relet at the prevailing open market rate to a new tenant (and they will get this too- such is demand).

.....<snip>.

The bill as it currently stands and as passed by the Seanad

(available here: http://www.oireachtas.ie/documents/bills28/bills/2016/9216/b92b16S.pdf)

already eliminates the right to end a part IV tenancy on the expiration of 4 years. The bill proposes t section 32) the repeal of Section 42 of the residential tenancies act 2004 - so part IV tenancies become of indefinite duration.

newacc2015

The S&P500 has delivered returns of 10% pa for the last 50 years on average. There is obviously peaks and crashes, but if you can expect a solid return on an index fund.

There is liquidity in stocks/index funds. If you need €200k tomorrow, you can sell them with no issue. Imagine how much you would get for your house if you needed to sell it tomorrow. If you buy stocks with many capital gain, they are lower taxed than rental income.

There is little risk in a highly diversified S&P 500 index fund.Where as if you have a non-paying tenant and a mortgage, you could end up bankrupt

Kapips88

Its almost like the owners of rented property dont actually own it anymore.
They cant make any decisions ever again once its rented to someone.

I bet a lot of people are going to go the AirBnB route now once a property is vacant.

listermint

Kapips88 wrote: »

Its almost like the owners of rented property dont actually own it anymore.
They cant make any decisions ever again once its rented to someone.

I bet a lot of people are going to go the AirBnB route now once a property is vacant.

I bet they don't airbnb is being hammered as it should on major capital cities they won't get leeway here either.

handlemaster

Looking like the govenment dont have a clue. But they will get 50 percent of the allowed rent increase so they can be happy.

handlemaster

Whats the feeling out there now ? Will this government move make you want to sell up ? Will investment properties come down in price

murphaph

handlemaster wrote: »

Will investment properties come down in price

Tenanted properties will be worth less than untenanted ones but overall this will see property prices increase because very few owner occupied properties are house shares, maximising the use of the property, whereas many rental units are house shares with maximum use made of the property. If you reduce the number of house shares by making landlords sell up to owner occupiers, you reduce the overall number of bed spaces in the housing market thus driving up the cost of the remaining bed spaces.

If your average owner occupier was willing to let all his bedrooms at maximum occupancy then there would be no effect on property prices IMO but that is not what most owner occupiers want.

beauf

Won't make any difference. Supply is the problem.

riclad

There s many landlords in negative equity , they,ll sell up as soon as they can afford to , when the loan on their rental home is less than the
the value of the house.
Landlords should get at least 20 per cent extra for renting to rent allowance tenants ,in urban area,s theres very little reason to take on rent allowance tenants when theres lots of professional working people looking for a place to rent .
Theres 1000,s of landlords out there making very little profit ,
after paying tax, property tax,usc etc
companys like apple pay 1 per cent tax, while landlords pay 50 per cent plus.