Media: 3 Tenants awarded compensation after their landlord refuses to engage in HAP

The_Conductor

rawn wrote: »

The rule about having vents in rental properties has been around for years though, no? Are the HAP regulations just regulations that have already been in place, or have they added new ones that LLs were previously unaware of?

The rules about ventilation- are set out in building regs.
The rules have evolved over time.
The only rules that apply to any given dwelling- are the rules that were in place when it was constructed- not the rules in place today.
So an apartment built in the 90s- legitimately can have ventilation built into window frames. An apartment built today- cannot. The apartment from the 90s- can legitimately be let to anyone- except a HAP tenant- who needs formal room ventilation systems- ventilation built into window frames is not acceptable.

So- in the instance of ventilation- the HAP rules are new rules that have been added for HAP tenants. They are not rules that landlords were previously unaware of- or indeed, non-compliant with- as properties without these specific ventilation systems- are 100% compliant with all legislation and regulations- they just don't meet the box ticking exercise on a HAP inspection............

Michael D Not Higgins

The_Conductor wrote: »

The rules about ventilation- are set out in building regs.
The rules have evolved over time.

Another thing to consider is the HAP inspection is based on today's requirements. Does this mean the standards will continue to get more onerous and be forced on the landlords to comply with regardless of the necessity, cost or ability to implement?

Askthe EA

davindub wrote: »

Refurbishments actually don't effect the Rpz cap.

Thats yet to be tested to be honest!

davindub

Askthe EA wrote: »

davindub wrote: »

Refurbishments actually don't effect the Rpz cap.

Thats yet to be tested to be honest!

It would be the only interpretation based on the actual legislation. Substantial refurbishment relates to termination of tenancy, substantial change in nature and increasing Mv relates to the Rpz cap.

LuckyLloyd

utmbuilder wrote: »

I reckon the next play of the Government will be to attack airbnb's , seen this coming they are going to go on a rampage passing the buck of blame onto landlords and kick the **** out of them now for their mistakes.

Of course AirBnB letting is going to be strongly regulated. It would be naive to think otherwise.

Hollister11

Why should a landlord be forced to accept anything other than cash. It's their investment, they take the risk letting someone in their house and again it's their property.

Shocking decision.

jamesthepeach

Hollister11 wrote: »

Why should a landlord be forced to accept anything other than cash. It's their investment, they take the risk letting someone in their house and again it's their property.

Shocking decision.

Landlords take the government's risk too. All of it.
Sorry state of affairs.

khamilto

The_Conductor wrote: »

Was there any explanation of how they came up with the 40k fine?
Seems completely and utterly over the top- and without any justification.
Also- was it clarified what the story with the landlord is- are they one of the 1-2 unit landlords (who make up 63% of the entire market)- or a large scale landlord?

The 40k- just sticks in the gullet- even if they were making a finding against the landlord- they could have given him/her a reasonable fine- 40k just seems so ridiculous- its the sort of fine that they're trying to bankrupt them- or worse........

40k fine- for a private individual- even if they were in the wrong- and I'd argue that the main issue here was the LL argued the wrong case- aka he/she tried to get it dismissed on a point of law- rather than attacking the system head-on to show it was totally ridiculous............

40k though? My god.

What fine? I can't find any mention of a fine. If you had bothered to read the adjudication (which you claimed to have read), you would have clearly seen what the compensation was for: It was for the material financial loss suffered by each complainant due to not being able to avail of the HAP payment for the period in question.

This represents an actual loss from when the refusal of HAP became unlawful on 1st January 2016 to date of circa €13,977 (84 weeks as at the date of issue of decision rounded up).

The Complainant has suffered an actual financial loss of circa €13,977 since the introduction of the ‘housing assistance ground’ and considerably more since the Respondent’s initial refusal to accept HAP on her behalf in March 2015. I am constrained by the maximum award of €15,000 which by virtue of Section 27(2) is fixed at the maximum District Court civil jurisdiction, and in my view does not reflect the seriousness of the discrimination in the instant case. However, I also have to nominally allow for a theoretically more serious situation such as where eviction has resulted. Having regard to all the circumstances and pursuant to Section 27(1)(a) of the Acts, I deem it appropriate to order the Respondent to pay €14,977 to the Complainant in compensation for the effects of the prohibited conduct concerned.

HAP inspections are generally carried out by engineers. The standards are as set in legislation, the fact that a majority (as verified by how many rented properties fail) of rented accommodation in Ireland are below the legal standard is not a valid reason to discriminate against HAP recipients, and I wish any landlord who tries that angle of defense in court all the luck in the world.

The age of the rental property is immaterial to the rental regs for what should be very obvious reasons, a business must comply with the regulations in force at the time in which a contract is entered.

"You see, to bring my property up to the minimum spec for all rented accommodation as certified by Council engineers would be too financially onerous for me. If I rented it to a HAP recipient, an engineer's inspection would find that I am not in compliance with legislation whereas renting privately would mean my tenant would just have to accept it as is. I shouldn't be forced to comply with the law!"

You keep talking about a slippery slope, yet it appears to only exist in your imagination. The WRC has just proven itself to be eminently capable in adjudicating on discrimination cases as regards tenancies, yet you keep finding faults that you won't actually specify beyond "I don't agree with the result, I don't agree with the result!"

Your repeated claims that the Landlords case was "legally accurate" seems to be based on nothing but a terrible lack of knowledge on anything legal. Unless the terms of the tenancy agreement included a covenant on never accepting RS/HAP, new legislation around discriminating refusal of those schemes would not be materially changing the existing contract. Beyond that, you cannot sign away fundamental rights in a contract, including rights that were not enumerated at the time.

Really, you just seem to be desperately trying to defend what seems to be indefensible. This case appeared to be cut and dry and by the sounds of it, both the landlord's agents and the landlord's legal representation were frustrated by the Landlord's refusal to engage with either the HAP scheme or the legal process. Yet here you are, with long-winded nonsensical posts full of pseudo-legalese e.g.

At this point- the stage is being set for a landlord to either bring a case against a local authority, with the Revenue Commissioners as a notified party- or vice versa, against the Revenue Commissioners- with their local authority as a notified party- the relevant Ministers should be named parties on the case (of course their civil servants will get them taken off- but its the principal of the matter).

What's your source for this claim? Your evidence? Do you have professional experience that suggests this? It's a very strong claim to make, so surely you must have some shred of evidence for making it beyond being clearly upset by all this.

the_syco

khamilto wrote: »

HAP inspections are generally carried out by engineers. The standards are as set in legislation, the fact that a majority (as verified by how many rented properties fail) of rented accommodation in Ireland are below the legal standard is not a valid reason to discriminate against HAP recipients, and I wish any landlord who tries that angle of defense in court all the luck in the world.

Unless I'm reading it wrongly, it's only below the HAP standard. If it was below the legal standard, they'd be eligible for grants, and/or the work would be tax deductible.

khamilto

the_syco wrote: »

Unless I'm reading it wrongly, it's only below the HAP standard. If it was below the legal standard, they'd be eligible for grants, and/or the work would be tax deductible.

The HAP standard is the legislative standard, as interpreted by council engineers using current building regulations. They are in theory what every apartment being offered up for a new tenancy should be adhering to.
Building regs when a property was built are irrelevant to the building regs required for a freshly let property now. Renting is a business, and like regulations across all sector of business, the regulations when a product/service is sold or contracted are the regs in force at that specific time. If landlords no longer find it economically viable to keep their properties up to spec, like any business, they can wind up.

The legislation uses words such as "adequate" when stating what the requirements are. Adequate is determined by Council engineers. Council engineers use current regulations to determine what constitutes adequate.

the_syco

khamilto wrote: »

The HAP standard is the legislative standard, as interpreted by council engineers using current building regulations. They are in theory what every apartment being offered up for a new tenancy should be adhering to.

As with everything else in Ireland, I fear this is a case of the left hand not speaking to the right hand.

The_Conductor wrote: »

If it was tax deductible- you might do the modifications- however, Revenue say its an enhancement to the property- and thus does not qualify- whereas the Local Authorities disagree with this assessment in their HAP checklist..........

If the above is true, and that Revenue do not see continuous improvements on a yearly basis as tax deductible, then yes, landlords will exit from the long-term market to avoid being sued.

As the government thus far have shown that they will not step up to house people, and mainly leave it to the private sector, they are IMO the man in the picture below; pruning the tree that keeps them up.

GGTrek

khamilto wrote: »

The HAP standard is the legislative standard, as interpreted by council engineers using current building regulations. They are in theory what every apartment being offered up for a new tenancy should be adhering to.
Building regs when a property was built are irrelevant to the building regs required for a freshly let property now. Renting is a business, and like regulations across all sector of business, the regulations when a product/service is sold or contracted are the regs in force at that specific time. If landlords no longer find it economically viable to keep their properties up to spec, like any business, they can wind up.

Sure and this is exactly what is happening. It is exactly this line of thinking that has caused a massive shrink of housing supply. Your line of thinking and your legal arguments sound like a city planner or a surveyor ones (I met a few) Please keep pushing for it. Everything is going to end well (or maybe not).

khamilto

GGTrek wrote: »

Sure and this is exactly what is happening. It is exactly this line of thinking that has caused a massive shrink of housing supply. Your line of thinking and your legal arguments sound like a city planner or a surveyor ones (I met a few) Please keep pushing for it. Everything is going to end well (or maybe not).

I don't have an oar in this, I stopped renting well over a year ago and stopped renting out 4 years ago.

There has long been an expectation from part time landlords that they are somehow special and that they (and their industry) deserve extra rights and extra protection.

I can guarantee you that companies that specialise in buying apartment blocks and renting them out long-term have zero problems with HAP standards, as they accept it as an industry expense. They also treat housing stock as a depreciating asset, not an appreciating one, and with a defined lifespan after which it will no longer be suitable for purpose nor economically viable to update. A landlord with a 60 year old house that is no longer suitable as per current building regs, should have no expectation that it can be rented out in perpetuity with nothing but the most basic of repairs.

Also, you're making a really basic mistake there. There isn't and hasn't been a shrink in housing (or rental) supply in Dublin. There has been an increased demand without a concurrent rise in supply. Further, if you think part-time Landlords ever had any meaningful effect in driving up house supply, you're sadly deluded on that.

FrStone

Mrs OBumble wrote: »

There's another way they're discriminated against: rental property income is treated as unearned. If any of it is put into a pension scheme, then it doesn't qualify for the tax-relief that earned income gets.

That's because it's neither employment income or trading income. It is clearly investment income.

khamilto

FrStone wrote: »

That's because it's neither employment income or trading income. It is clearly investment income.

Indeed. I'm not sure where the belief that owning an asset and deriving a return on that asset is somehow anything other than investment income.

Investors pay 4% PRSI on dividends (see here) but apparently Landlords should be exempt because....that's why.

Here's a few links about part-time Landlords complaining about REITs (i.e. the kind of investor who doesn't care about putting in the required maintenance)

After falling into the sector “by accident”, Pat at one stage had about 80 tenants on his books in 20 properties around Dublin 6 and Dublin 1. “I wouldn’t house one now,” he says. “Not one.”
This, he argues, is due to “appalling treatment” by the Government, and what he calls the “Tesco-isation” of the sector. “What I mean by that is, the small guy who was providing accommodation was put out of business while the bigger players came in.
“These big American companies are coming in and they have no problem with compliance and all the registration and so forth. It’s easy for them because they have the scale, but, for the small guy, it’s murderous.

Isn't it awful when a business has to comply with rules and regulations?

“It’s very inequitable. You have a smaller landlord who is being really taxed out of it. They’re providing accommodation, a service and helping the Government out in a big way. If they weren’t there, the Government would have to provide it,” says Davitt,
McNamara also believes Reits have an “unfair advantage”, including the fact that they are able to buy blocks of apartments “at a knock-down price and are able to let them out at top dollar”.
“When you have that kind of advantage, it’s unfair competition,” he says.

Apparently having any kind of an advantage = unfair competition. Fantastic.

the_syco

khamilto wrote: »

Investors pay 4% PRSI on dividends (see here) but apparently Landlords should be exempt because....that's why.

Would landlords be able to pay the 4% PRSI, instead of the 40% tax they currently have to pay?

The_Conductor

khamilto wrote: »

The HAP standard is the legislative standard, as interpreted by council engineers using current building regulations. They are in theory what every apartment being offered up for a new tenancy should be adhering to.

Its an interpretation by a vested party of a legislative standard. They have chosen to apply current building regulations as their interpretation of the standard. Current constructed buildings are obliged under law to comply with current building legislation- no other buildings. Council engineers are deigning that all properties presented for rental- should be retrofitted, regardless of when they were constructed, to comply with current building regulations. I think we are both in agreement with this?

khamilto wrote: »

Building regs when a property was built are irrelevant to the building regs required for a freshly let property now. Renting is a business, and like regulations across all sector of business, the regulations when a product/service is sold or contracted are the regs in force at that specific time. If landlords no longer find it economically viable to keep their properties up to spec, like any business, they can wind up.

Building regs when a building was built- most certainly are relevant- and are policed by the self-same council engineers who in their infinite wisdom, are applying HAP rules as some sort of gospel. Any building which is non compliant with the regulations associated with it- comes under the jurisdiction of the designated county engineer, and regardless of whether it is rented, or owner occupied- has a sliding scale of penalties associated with the non-compliance- up to and including an order to demolish the building. We've had 42 orders to demolish buildings thus far this year- the largest number of which were in Kidlare Co. Co.- followed closely by Meath Co. Co.

Any other business- if they have to change their business model- or the specs- to remain in business- are eligible to write-off the cost associated with this respec- against their taxable income. Landlords- are not- precisely because the respec is deemed to be an enhancement of the property.

Revenue and the Local Authorities *need* to talk to one another ang get their stories straight- as it stands, they are singing off two entirely different hymn sheets.

khamilto wrote: »

The legislation uses words such as "adequate" when stating what the requirements are. Adequate is determined by Council engineers. Council engineers use current regulations to determine what constitutes adequate.

Legislation should not use words like 'adequate'. Legal Divisions in Departments have had the riot act read to them over crap like this- sloppiness like this is indefensible in the modern era. Housing complaining that they are short staffed and have no intention of defending the SI- if its challenged- is appalling- just amend and correct the bloody SI.

The_Conductor

FrStone wrote: »

That's because it's neither employment income or trading income. It is clearly investment income.

Guys- I'm not entirely clear how or why you seem to imagine that a landlord letting a property is simply sitting back and letting his investment generate income for him/her. It is patently unlike a share dividend in this respect- however, for whatever reason- you seem insistent on viewing it in this manner.

Any landlord who spent their 250k on an apartment, installed a tenant- and buggered off to the Algarve to enjoy their retirement- would have an RTB case lobbed at them before very long.

Your share dividends do not call you at 11.30pm at night- because a lightbulb has blown, on a Sunday morning when they trip fuses by accidentally pouring water over a live plug etc etc. It is a business- whether its structured as one- or not- is entirely a different question- and for tax reasons- it would be entirely more appropriate if it was structured as a formal business. As it stands- small landlords with one or two units- comprise over 63% of all registered tenancies with the RTB (and over 96% of all tax paid on rental income).

The correct argument- would be whether or not landlords should be coralled into running tenancies via formal companies- or allowed operate as sole traders- as the majority are continuing to do. Suggesting letting a property is pure investment income- to be brutally honest is trolling, plain and simple- its deliberately trying to provoke a negative response. Flaming people in this manner- isn't acceptable behaviour.

davindub

the_syco wrote: »

khamilto wrote: »

Investors pay 4% PRSI on dividends (see here) but apparently Landlords should be exempt because....that's why.

Would landlords be able to pay the 4% PRSI, instead of the 40% tax they currently have to pay?

Prsi + 40% + usc on both.....

Askthe EA

khamilto wrote: »

The age of the rental property is immaterial to the rental regs for what should be very obvious reasons, a business must comply with the regulations in force at the time in which a contract is entered.

.

Isn't this the nub of the issue? Isnt it possible, as in in the example I gave, that an existing tenant could have entered into a lease when the property was wholly compliant but over time the regs changed and it is now no longer compliant?

To accept HAP from the exact same tenant for the exact same property will lead to an inspection, which will lead to a large bill, none of which is tax deductible.

Any other business is allowed to claim any costs incurred with regulatory changes except landlords, its not looked at as a business (by revenue at least).

Browney7

Askthe EA wrote: »

Isn't this the nub of the issue? Isnt it possible, as in in the example I gave, that an existing tenant could have entered into a lease when the property was wholly compliant but over time the regs changed and it is now no longer compliant?

To accept HAP from the exact same tenant for the exact same property will lead to an inspection, which will lead to a large bill, none of which is tax deductible.

Any other business is allowed to claim any costs incurred with regulatory changes except landlords, its not looked at as a business (by revenue at least).

Presumably it's CGT deductible if it's classified as an improvement by revenue?

The_Conductor

Browney7 wrote: »

Presumably it's CGT deductible if it's classified as an improvement by revenue?

Yes- when you sell it.
The whole point is- these are allegedly a business- rather than trying to sit on an appreciating asset (though of course there are people out there who are in it for the appreciating asset).
If you're running the tenancy as a going-concern- and incurring large non-deductible costs- honestly- it doesn't make any business sense continuing- you'd be far better off- selling and getting the hell out.

On the bright side- looking at the bigger picture- the property becomes available for a prospective owner occupier. On the cloudier side- the tenant is out- which sort of negates the whole idea to begin with.

The lack of joined up thinking here is staggering.

FrStone

FrStone wrote: »

That's because it's neither employment income or trading income. It is clearly investment income.

How on earth are you arriving at that conclusion? Renting out property is very much a hands on job as much as many other business and it should be treated exactly the same. It's head in the sand stuff saying it's simply an investment.

Browney7

Alora Embarrassed Vapidity wrote: »

How on earth are you arriving at that conclusion? Renting out property is very much a hands on job as much as many other business and it should be treated exactly the same. It's head in the sand stuff saying it's simply an investment.

Hands on? Paint the place if needed, Show the property day one, vet tenants, register tenancy, take a few phone calls during the year if needed (very little maintenance on new property), inspect two to three times a year. Hardly he equivalent of running a shop, mechanic or plumbing business in fairness... Of course there is some work in it which is reflected in the higher income yield you get v dividend bearing equity investments

What do letting agents charge to take the tenant facing element out of it? 1 month to ten % of annual rent?

I don't blame landlords exiting - if you bought an apartment for 200k and if someone is willing to pay 400k why wouldn't you sell? Your investment has effectively matured. Time to cash in. There will be a glut for sale once the seven year CGT relief is up in 2019 - you'd be a fool not to sell as you gradually lose the relief

khamilto

the_syco wrote: »

Would landlords be able to pay the 4% PRSI, instead of the 40% tax they currently have to pay?

Many Irish companies pay dividends twice a year and will always deduct 20% tax at source from the gross dividend. If you are liable for tax at a higher rate you will pay tax on the gross dividend at the higher tax rate and be given a credit for the 20% tax already deducted.

PRSI and the USC are also due on the gross dividend and will be collected through the Self Assessment system if applicable.

Why should Landlords receive preferential treatment?

The Conductor wrote:

Its an interpretation by a vested party of a legislative standard. They have chosen to apply current building regulations as their interpretation of the standard. Current constructed buildings are obliged under law to comply with current building legislation- no other buildings.

Oh look, another wonderful insight. Tenants, Landlords, Local Authorities, Engineers, etc etc all have a vested interest. It is perfectly right, natural and acceptable to have a vested interest.

Yet here you are talking about a 'vested party' (you mean vested interest. Vested party is a legal term and does not mean what you think it does) as if that's some sort of negative trait of Local Authorities. "Oh, look at the LA's. Did you know they have a vested interest? They must be awful!"

Local Authorities (and presumably DHPLG) believe that under law, existing properties being let to a new tenant are in a meaningful way expected to be in line with current building regs.

Any other business- if they have to change their business model- or the specs- to remain in business- are eligible to write-off the cost associated with this respec- against their taxable income. Landlords- are not- precisely because the respec is deemed to be an enhancement of the property.

You're showing an abject lack of knowledge of accounting if you think a business can write-off costs associated with increasing the value of an investment.

Half of your problems seem to stem from not understanding how different classes of assets are treated and from the mistaken belief that landlords who choose not to form a business entity should be treated the same way as other businesses.

Revenue and the Local Authorities *need* to talk to one another ang get their stories straight- as it stands, they are singing off two entirely different hymn sheets.

No they are not, and for all your waffle (and let's be clear, it is waffle because you seem to regularly refuse to back up any of your assertions) the Revenue and the LA's positions are not at odds.

Revenue do not believe that expenditure that increases the value of an investment asset can be classed a business expense. Local Authorities want improvements in standards in rental accommodation.

They are in no way mutually exclusive, and I look forward you to trying to explain how.

Legislation should not use words like 'adequate'. Legal Divisions in Departments have had the riot act read to them over crap like this- sloppiness like this is indefensible in the modern era. Housing complaining that they are short staffed and have no intention of defending the SI- if its challenged- is appalling- just amend and correct the bloody SI.

Common law frequently uses words like adequate. You would be aware of that if you had 1% of the knowledge you claim to have.

Can you provide a reference or source for your claim that "Legal Divisions in Departments have had the riot act read to them over crap like this"?

I'm still waiting for a source/reference on one of your other claims, and I notice you couldn't back up the vast majority of your 'points' (and I use that term loosely) that I challenged you on.

Askthe EA wrote:

Isn't this the nub of the issue? Isnt it possible, as in in the example I gave, that an existing tenant could have entered into a lease when the property was wholly compliant but over time the regs changed and it is now no longer compliant?

To accept HAP from the exact same tenant for the exact same property will lead to an inspection, which will lead to a large bill, none of which is tax deductible.

Any other business is allowed to claim any costs incurred with regulatory changes except landlords, its not looked at as a business (by revenue at least).

The first is a valid point. If the tenancy was entered into before building regs that a HAP inspector is insisting the Landlord updates his property to comply with, this would be a very serious issue and one that would almost certainly fall in the Landlord's favour.

"Any other business" is the wrong language. "A business" is the correct one. Individual landlords are treated as investors. If they wish to be treated differently, they can form a business. Or they can sell their investment and invest in something else.

Camilla Few Tapestry wrote:

How on earth are you arriving at that conclusion? Renting out property is very much a hands on job as much as many other business and it should be treated exactly the same. It's head in the sand stuff saying it's simply an investment

Investors who manage their own portfolios don't receive tax breaks for doing so.

Let's see, The Conductor has so far:
Lied about reading the adjudication (he waffled on about the fine when the adjudication clearly explained the criteria for compensation)
Was unaware that the WRC has been the venue for discrimination cases in relation to tenancies for several years
Waffled on about some sort of slippery slope but has failed to explain what exactly this slippery slope is beyond hints that it is bad for individual landlords
Has stated that the Landlords case in the WRC was "legally accurate" but has failed to explain what his source or evidence for this is, particularly in light of his proving that he didn't actually read the adjudication
Showed an abject lack of knowledge as to how commonlaw legislation is phrased
Offered yet more legal opinion that he refuses to source or give evidence for
Offered yet MORE legal opinion that he refuses to source or give evidence for

It's quite disgraceful how you throw around obviously incorrect legalese and position yourself as someone informed on the subject.

awec

Alora Embarrassed Vapidity wrote: »

How on earth are you arriving at that conclusion? Renting out property is very much a hands on job as much as many other business and it should be treated exactly the same. It's head in the sand stuff saying it's simply an investment.

What rubbish.

Michael D Not Higgins

Mod note: khamilto, your posting is quite aggressive in how you're engaging in the discussion. We appreciate alternative points of view but please tone it down a bit.

khamilto

khamilto wrote: »

You're showing an abject lack of knowledge of accounting if you think a business can write-off costs associated with increasing the value of an investment.

Ever heard of capital allowances?

awec wrote: »

What rubbish.

The fact that's all you can say proves I'm correct. Buying the property is an investment but renting it out is a job.

khamilto

Alora Embarrassed Vapidity wrote: »

Ever heard of capital allowances?

Yes. You seem to have heard of it, but you clearly don't know what it is seeing as:

Capital allowances provide businesses with tax relief for the reduction in value of eligible capital assets used by the business

Askthe EA

That escalated quickly......