Is the end of the road for landlords coming ?

Yourself isit

Ethan Rough Saber wrote: »

Why, why should a person who is renting a property and taken no risk have more or less total control over the property? The 4 year thing as it stands it's too bad as at least every 4 years a LL can move on the tenants if he wants to. No way should he be stuck with people in his property indefinitely, his property.

A rule of indefinite part 4 is just going to make LLs choose their tenants much more wisely, more choosing to rent by the room and picking young professionals, post grad students or even students all of whom won't stay very long and enable them to retain control of their property.

Plenty of long term investments with high returns are locked in. A tenancy with a good tenant with 20 years on his lease is like a long term security generating yearly dividends and capital gains at the end of the term. You want a business to work as an investment but also have the rights to terminate the contract because you own the property. See it as a long term investment. Or some larger investor will.

Go ahead of you wish and operate a loss making business but it ain't for me nor most people who are doing it to make money and not in 30 years time. Property very much interests me as a side businsss and I'd like to have a house or two rented out in the future but I will be doing it in a way that I'm making money from day 1 along with talking all the precautions possible so as not to get stuck with tenants indefinitely. If I can't make money or at the absolute minimum break even I won't do it (excluding initial investment for the deposit). However I've done the sums on many places and if you are shrewd there are opportunities to cover all costs and make a profit each month.

I doubt you will ever get to be a landlord . A quick search indicates you don't have a house yet in your thirties. Btl mortgages need high deposits and have shorter terms so you'd want you get cracking unless you have money to inherit. And of course if you want a profit from day one, after tax you will need more than the requisite 50% down even with the present day elevated rents and low interest rates. And this is peak. From now on the political winds are blowing against landlords and interest rates will rise.

Treating the second home as a pension rather than an income stream isn't hard to understand either. If someone supplements a house with €100 euro per month from his main income and ends up with a 300k house after 15-20 years that's a pretty good deal. Even adding on property tax and incidentals it would still be a good deal.

However I don't think that banks will lend these days in that situation. AIB isn't even in the BTL business.

Fol20

Yourself isit wrote: »

Plenty of long term investments with high returns are locked in. A tenancy with a good tenant with 20 years on his lease is like a long term security generating yearly dividends and capital gains at the end of the term. You want a business to work as an investment but also have the rights to terminate the contract because you own the property. See it as a long term investment. Or some larger investor will.



I doubt you will ever get to be a landlord . A quick search indicates you don't have a house yet in your thirties. Btl mortgages need high deposits and have shorter terms so you'd want you get cracking unless you have money to inherit. And of course if you want a profit from day one, after tax you will need more than the requisite 50% down even with the present day elevated rents and low interest rates. And this is peak. From now on the political winds are blowing against landlords and interest rates will rise.

Treating the second home as a pension rather than an income stream isn't hard to understand either. If someone supplements a house with €100 euro per month from his main income and ends up with a 300k house after 15-20 years that's a pretty good deal. Even adding on property tax and incidentals it would still be a good deal.

However I don't think that banks will lend these days in that situation. AIB isn't even in the BTL business.

AIB are still in the BTL business. I enquired recently and although the figure wasnt great for me. They are still doing them.

_Jamie_

Yourself isit wrote: »

If someone supplements a house with €100 euro per month from his main income and ends up with a 300k house after 15-20 years that's a pretty good deal.

My thoughts too. Even having to make up a small shortfall in the mortgage payments is well worth it for having an an unencumbered asset at the end. It seems fanciful to expect to get this asset AND to always be turning a yearly profit too. If I was planning to be a landlord, I'd expect there would be many periods of time where I wouldn't see a profit. It's definitely something that should be considered a long-term investment.

Graham

_Jamie_ wrote: »

My thoughts too. Even having to make up a small shortfall in the mortgage payments is well worth it for having an an unencumbered asset at the end.

Any landlord that basis his business model on only just covering current record low interest rates is asking to be forced to sell when interest rates inevitably rise. Not good for landlords, not good for tenants.

That counts double now that government are intending to prevent rent rises which may be necessary to account for future cost increases.

_Jamie_

Graham wrote: »

Any landlord that basis his business model on only just covering current record low interest rates is asking to be forced to sell when interest rates inevitably rise. Not good for landlords, not good for tenants.

I've already said that the current market is one where a landlord can expect to profit nicely. But it won't always remain that way and that is what any landlord needs to plan for. I can't believe anyone hoping to become a landlord would be so foolhardy as to not do that. Do people who are hoping to becoming landlords really believe that they will always turn a profit? Even without profit, they will benefit from having their mortgage almost covered. If the idea of not always profiting from renting property turns people away from doing it, I'm not sure what the solution is there. They have unrealistic expectations. There are things that can be done to help of course, but nothing will 100% ensure that they make clear money from the endeavour.

Yourself isit

Yourself isit wrote: »

I doubt you will ever get to be a landlord . A quick search indicates you don't have a house yet in your thirties. Btl mortgages need high deposits and have shorter terms so you'd want you get cracking unless you have money to inherit. And of course if you want a profit from day one, after tax you will need more than the requisite 50% down even with the present day elevated rents and low interest rates. And this is peak. From now on the political winds are blowing against landlords and interest rates will rise.

Treating the second home as a pension rather than an income stream isn't hard to understand either. If someone supplements a house with €100 euro per month from his main income and ends up with a 300k house after 15-20 years that's a pretty good deal. Even adding on property tax and incidentals it would still be a good deal.

However I don't think that banks will lend these days in that situation. AIB isn't even in the BTL business.

You have no idea about my ability to buy a property or multiple properties, what has very early 30's got to do with it? If you read a bit more you would also see mortgage approved with the intention to buy very soon, live there a short time most likely and then let it out when buying my next place (well most likely building on our own land) so I won't be dealing with BTL interest rates or deposit requirements (Which are 30% not 50% as you incorrectly indicated). Also the calculations I have been doing would show net profit with about a 20% deposit such is the vast difference between rental prices and mortgage repayments (buying the right type of property in the right location too of course, as I mention you have to be shrewd).

I don't see it as a pension, I have a pension already I'd see it as a business that would be expected to generate additional income to supplement my salary along with having an asset which could be sold or retained in future.

John_Rambo

You should really try doing it instead of talking about it Nox. I mean for yourself.

noodler

50/60% increases in rent over the last two years haven't increased supply so don't blame the government for trying to call a halt.

Happy for the landlords bluff to be called.

Workers can't continue paying nearly half their salary in rent.

John_Rambo

John_Rambo wrote: »

You should really try doing it instead of talking about it Nox. I mean for yourself.

You should mind your own business. I'll do what I want and when I feel is right. Advance planning and "talking about it" as you say has given me far more knowledge than many already in the business.

But of course by your thinking nobody can comment on or talk about things they haven't done despite having build up a very in depth knowledge (something you have levelled at me on more than on topic).

John_Rambo

Ethan Rough Saber wrote: »

You should mind your own business. I'll do what I want and when I feel is right. Advance planning and "talking about it" as you say has given me far more knowledge than many already in the business.

But of course by your thinking nobody can comment on or talk about things they haven't done despite having build up a very in depth knowledge (something you have levelled at me on more than on topic).

It's a public forum and you're constantly talking about your ambitions of being a landlord and buying property to rent. For years now. Just good giving you good advice (god knows you're always giving people advice here), go and do it instead of talking about it. You'll learn a lot more doing than talking.

athtrasna

Mod note

Enough of the sniping. Attack the post not the poster is one of the foundations of boards. Please bear that in mind.

the_syco

noodler wrote: »

50/60% increases in rent over the last two years haven't increased supply so don't blame the government for trying to call a halt.

Happy for the landlords bluff to be called.

Actually, how much tax did the government lessen what the landlord could claim against during that timeframe?

I wonder will the landlords call the governments bluff regarding RA tenants?

beauf

noodler wrote: »

50/60% increases in rent over the last two years haven't increased supply so don't blame the government for trying to call a halt. Happy for the landlords bluff to be called. Workers can't continue paying nearly half their salary in rent.

Why would increased rent increase supply?

What Bluff.

The Govt is successfully trying to divert peoples attention from its abysmal failure on delivering housing, by pushing new controls which haven't worked elsewhere. People are falling for it. Then are baffled when it hasn't solved the problem. It may indeed make it worse in the long run.

beauf

the_syco wrote: »

...I wonder will the landlords call the governments bluff regarding RA tenants?

Theres another measure that hasn't worked.

It was another smoke and mirrors trick that avoided the govt actually tackling the real problems in the sector.

murphaph

the_syco wrote: »

Actually, how much tax did the government lessen what the landlord could claim against during that timeframe?

I wonder will the landlords call the governments bluff regarding RA tenants?

I doubt we'll see much change there. In urban areas with decent employment landlords have been refusing to accept RS tenants for a few years now.

In rural areas of high unemployment landlords can't afford to be so picky.

antoinolachtnai

beauf wrote: »

Why would increased rent increase supply?

What Bluff.

The Govt is successfully trying to divert peoples attention from its abysmal failure on delivering housing, by pushing new controls which haven't worked elsewhere. People are falling for it. Then are baffled when it hasn't solved the problem. It may indeed make it worse in the long run.

Higher rent increases supply because it makes it more attractive to build and to rent. The increased supply then results in more people being housed and a reduction in rent over the medium term.

The problem now isn't the existing landlords and rheir properties so much as that as things are, new rental accommodation isn't coming into the market at any great rate and there is no reason to think this will change for some time.

beauf

Only theory. In practice its more attractive to build and sell. For many its more attractive not to build in the first place. Hence the shortage.

Any either case its got nothing to do with existing LL. So I dunno who's bluff is being called.

Graham

beauf wrote: »

Only theory. In practice its more attractive to build and sell.

So instead of buying an apartment in the IFSC or a 3 bed semi in Phibsboro you think it's going to be more attractive for a small investor to build? Where?

beauf

Graham wrote: »

So instead of buying an apartment in the IFSC or a 3 bed semi in Phibsboro you think it's going to be more attractive for a small investor to build? Where?

No I'm saying few if any new builds are coming into the rental market. Few are being built in the first place.

New building stock and rental stocks are at their lowest historically. This didn't happen overnight. It took a long time to happen. So we had plenty of warning before the rents got to their current level.

Graham

beauf wrote: »

we had plenty of warning before the rents got to their current level.

Cant argue with that.

4ensic15

Graham wrote: »

Cant argue with that.

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


Some people did!

nebraska132

Hi

I've been following these discussions on and off these last few days. It's depressing but not surprising that we have reached this situation. Everyone can see there is housing problem and rather than deal with underlying causes and structural problems the government has taken rather radical steps to disincentivise the suppliers of property to the rental market.

I wonder will or should landlords seek to significant increases in deposits to cover the longer term risks now associated with rentals. Will we see 3 or 6 month deposits versus the more common 1 month?

Sad Professor

nebraska132 wrote: »

Hi

I've been following these discussions on and off these last few days. It's depressing but not surprising that we have reached this situation. Everyone can see there is housing problem and rather than deal with underlying causes and structural problems the government has taken rather radical steps to disincentivise the suppliers of property to the rental market.

I wonder will or should landlords seek to significant increases in deposits to cover the longer term risks now associated with rentals. Will we see 3 or 6 month deposits versus the more common 1 month?

Some LLs were already seeking 3 month deposits and well-off tenants were paying 6-12 months in advance just to secure a property. RTB has a deposit protection scheme in the works that may regulate this, or link bigger deposits and more favourable tax treatment to security of tenure.

The_Conductor

nebraska132 wrote: »

I wonder will or should landlords seek to significant increases in deposits to cover the longer term risks now associated with rentals. Will we see 3 or 6 month deposits versus the more common 1 month?

3 and 6 month deposits are becoming the norm- and are the norm on the continent (with the exception of social housing in areas where landlords have difficulty finding tenants).

A lot of tenants are trying to differentiate themselves with landlords now- by offering increasing deposits- its also no longer unheard of for tenants to pay an entire year's rent in advance (there are a few threads in this forum illustrating this).

The larger deposits are being driven more by tenants who are trying to distinguish themselves from the field and secure a particular property in a location they want- than by landlords though (i.e. it is a market led phenomenon, which is working to the advantage of a limited number of tenants who *want* to live in a specific property or a specific area- and are willing to make this investment to do so. Obviously the landlords aren't arguing with it..........)

TheQuietFella

Roger_007 wrote: »

It was only when I became an 'accidental landlord ' that I realised what a raw deal landlords get. 3 years ago, I inherited a small two-bedroomed house in a commuter town. I spent about €10k upgrading and reequiping it and I let it out to a young family for €600 per month.
When I paid all the overheads such as property tax, maintenance costs, insurance etc and then paid the income tax, PRSI, USC, I am left with a net income of about €50 per week.
The tenants are now moving on and there is absolutely no way I am going to let the house again. I will keep it unoccupied until I can can sell it for a reasonable price.
I'm sure I'm not the only landlord to choose this course of action and may explain why the number of properties available for rent is declining.

Wouldn't have believed this only I know someone in the same situation! Incredible!

beauf

deposits are of limited value when there is no protection from over holding.

the_syco

Sad Professor wrote: »

RTB has a deposit protection scheme in the works that may regulate this, or link bigger deposits and more favourable tax treatment to security of tenure.

As the RTB is seen as slow now, and very much pro-tenant, I can't see many landlords signing up to this, or blatantly ignoring it.

listermint

beauf wrote: »

deposits are of limited value when there is no protection from over holding.

Proper reference checks, A Character interview and Jobs references should really give one enough to work off when choosing though.

But if your only have bothered doing any of the above then well trouble can be waiting.

beauf

Depends what you mean by proper. To get a proper reference you'd have to information independently from a 3rd party, which they won't give out to a LL.

Easily spoofed. Especially by experienced scammers.

The_Conductor

the_syco wrote: »

As the RTB is seen as slow now, and very much pro-tenant, I can't see many landlords signing up to this, or blatantly ignoring it.

Yes- the RTB has sullied its reputation with the glacial speed which it seems to move at- and its complete and utter bias in favour of tenants. The fairest way to go forward- would be a wholly independent body- perhaps modelled on the Scottish example- married to a defined inspection regimen, and effective rules for ending the tenancies of overholders, non-payees, anti-social tenants or those who damage property.

I'd definitely go along with abandoning anything the RTB are doing- and handing the whole lot over to a different body altogether- hell, even put it out to tender- and have Capita who do the RTB's phone service, or an alternate vendor, manage the scheme- but just keep it away from the RTB.