Does putting in a new kitchen count as "substantial refurbishment"?

FishOnABike

Maya Defeated Meadow wrote: »

By far the easiest and best solution to all this is scrap these idiotic rent pressure zones and allow LLs to set the rent at an amount that the market will accept.

The problem being that it is unsustainable for rent to continue to increase at a rate greater thsn general inflation or wage increases (this applies to house sale prices too).

The government 'manage' the market in other ways through the planning process and various development incentives e.g. section 23, section 50, urban renewal, etc. it is just as valid to intervene in the public interest and to promote longterm market stability by controlling inflationary price increases while the supply problem is being addressed.

Eric Cartman

This has come up a few times, and while this is not an accurate figure or even a rule of thumb, from a few cases I have seen (doing work for some landlords) , spending 5k and refurbishing 2 rooms of the property seems to keep the rtb happy.

Ive seen kitchen completely done and the hall get a new wooden floor and paint

Ive seen the living room completely refurbished & new furniture and a bathroom redone to include an electric shower, new suite and tiles etc..

Ive seen the whole house painted and re-floored , furniture changed and a patio done out the back.

All in the last 4 months, rtb happy once receipts and photos submitted.

FishOnABike

FishOnABike wrote: »

The problem being that it is unsustainable for rent to continue to increase at a rate greater thsn general inflation or wage increases (this applies to house sale prices too).

The market should set the rent, once the rate gets too high the market will stop paying for it and rents will stop increasing.

Lack of supply is the main driver of rent increases, if this is sorted the market rate will fall. None of these are a LLs problem though and they should be allowed to maxamise their income now especially as losses from the recession need to be made back. That's how a business in nearly any other sector operates. Good times make up for bad times, market sets prices etc etc. But many LL are being unfairly tied down and prevented from running their business as they wish and to try and make some profit from it.

Carlos Orange

FishOnABike wrote: »

I'd be inclined to agree, rewiring (unless it is surface mounted in channels) usually requires chasing walls, lifting floorboards, replastering and repainting all while the house is without electricity for a significant time - not something you could probably do without moving out for a while.

Rewired my house this year without any noticeable time without electricity and without moving out.

You can do a lot to a house without moving out or planning permission.

FishOnABike

Before the RPZ legislation introduction Dublin rent rates had been increasing at 15% per annum and were at 65% above their 2010 rates. Rent rates are now almost 15% above their pre recession high.

When general inflation is at or near zero and salary increases are almost non-existant it is not sustainable in a functioning economy or society for the cost of basic needs to increase at double digit rates.

High costs are already disincentivising people from relocating to and working in Dublin. This is causing recruitment and retention issues for companies and harming the economy.

Rents are higher than they were at their previous peak as are asset values in property. How high is enough? Long term ecenomic and social stability is more important than short time profiteering by the few.

_Dara_

alias no.9 wrote: »

Does a substantial change in the nature of the accommodation necessarily imply an improvement?

Intuitively... yes? Arguing that the change doesn't have to be a improvement is one for the people who love to trot out sentences that start with "Well, technically..." before the eyes of everyone in the vicinity glaze over.

I mean, you could argue that the change doesn't have to be an improvement if a dispute arose but I wouldn't fancy the chances of anyone who tries that.

Lumen

Maya Defeated Meadow wrote: »

None of these are a LLs problem though and they should be allowed to maxamise their income now especially as losses from the recession need to be made back. That's how a business in nearly any other sector operates. Good times make up for bad times, market sets prices etc etc. But many LL are being unfairly tied down and prevented from running their business as they wish and to try and make some profit from it.

If you choose to operate in a market for a basic human need then you should expect to be heavily regulated. If you don't like it nobody is stopping you from employing your capital elsewhere.

Graham

FishOnABike wrote: »

Before the RPZ legislation introduction Dublin rent rates had been increasing at 15% per annum and were at 65% above their 2010 rates. Rent rates are now almost 15% above their pre recession high.

When general inflation is at or near zero and salary increases are almost non-existant it is not sustainable in a functioning economy or society for the cost of basic needs to increase at double digit rates.

High costs are already disincentivising people from relocating to and working in Dublin. This is causing recruitment and retention issues for companies and harming the economy.

Rents are higher than they were at their previous peak as are asset values in property. How high is enough? Long term ecenomic and social stability is more important than short time profiteering by the few.

I can't disagree with much of that post but pretty much everything you've pointed out is a symptom of lack of supply.

Tinkering with the symptoms (as is currently happening) is not going to do anything to fix the underlying cause. I'd go as far as saying the incessant tinkering is acting as a disincentive to increased supply if anything.

lcwill

Lumen wrote: »

Maya Defeated Meadow wrote: »

None of these are a LLs problem though and they should be allowed to maxamise their income now especially as losses from the recession need to be made back. That's how a business in nearly any other sector operates. Good times make up for bad times, market sets prices etc etc. But many LL are being unfairly tied down and prevented from running their business as they wish and to try and make some profit from it.

If you choose to operate in a market for a basic human need then you should expect to be heavily regulated. If you don't like it nobody is stopping you from employing your capital elsewhere.

Great comment. All landlords should keep this in mind.

Graham

lcwill wrote: »

Great comment. All landlords should keep this in mind.

It helps to look at the issue from both side of the equation.

Over-regulate a market and supply starts to reduce or move to other markets, AirBnB is a topical example.

A bit of balance is necessary before we find ourselves asking where have all the landlords (and rental properties) gone.

Lumen

Graham wrote: »

Over-regulate a market and supply starts to reduce or move to other markets, AirBnB is a topical example.

Without evidence that's just free market fundamentalism.

https://www.irishtimes.com/business/personal-finance/housing-who-are-the-cash-buyers-and-how-come-there-s-so-many-of-them-1.3224402

Vested interest wrote:

According to figures compiled by Savills, investors are some of the main drivers of cash sales, accounting for a little more than a third of all cash sales last year. And when you consider purchases by institutional investors such as reits and property funds are excluded, the figure for the entire market is likely to be higher.

But of course people respond to incentives. On AirBnb, there's a horrible symmetry between people renting out homes for Airbnb whilst councils pay for homeless to live in hotels.

Graham

Lumen wrote: »

Without evidence that's just free market fundamentalism.

Evidence like hundreds upon hundreds of residential properties moving to short-term (holiday) lets?

pwurple

Lumen wrote: »

If you choose to operate in a market for a basic human need then you should expect to be heavily regulated. If you don't like it nobody is stopping you from employing your capital elsewhere.

Indeed. That's why all clothing shops are required to limit the price for clothes, and all bread is the same price, subject to 2% annual increase. Right?

Bull of the highest order. Last time I looked, we were not an annex of Cuba.

And yes , you're correct. I will take my capital elsewhere. I am waiting for the budget to see if this idiotic RPZ stuff is changed. If not, the rest of my residential units are becoming commercial. All of mine are in mixed unit developments anyway, and there is a hell of a lot of demand for office space in the city. It's a shame, they are nice units, well located, well maintained, and I'll be sorry to lose the tenants, but I feel I have no choice. Im not running a charity or am I part of the local council.

15 years of being the best landlord I could be. Repeatedly thanked by tenants for being fair and charging below market rate for good tenants, paid a shedload of tax, always fully compliant. They can think again if I'm putting up with this kick in the teeth. It penalises the compliant and encourages a black market economy. Utter stupidity.

FishOnABike

FishOnABike wrote: »

Before the RPZ legislation introduction Dublin rent rates had been increasing at 15% per annum and were at 65% above their 2010 rates. Rent rates are now almost 15% above their pre recession high.

When general inflation is at or near zero and salary increases are almost non-existant it is not sustainable in a functioning economy or society for the cost of basic needs to increase at double digit rates.

High costs are already disincentivising people from relocating to and working in Dublin. This is causing recruitment and retention issues for companies and harming the economy.

Rents are higher than they were at their previous peak as are asset values in property. How high is enough? Long term ecenomic and social stability is more important than short time profiteering by the few.

We should be disincentivising people from moving to Dublin anyway and incentivising job creation around the county. This would be far more beneficial to the economy rather than forcing loads of people to Dublin who don't want to live there as that's where jobs are being created.

__..__

Maya Defeated Meadow wrote: »

We should be disincentivising people from moving to Dublin anyway and incentivising job creation around the county. This would be far more beneficial to the economy rather than forcing loads of people to Dublin who don't want to live there as that's where jobs are being created.

Crazy talk. All any minister has to do is pander to the media and come up with a few silly ideas to divert attantion until he rotates out and then we start again. That's how it works

Lumen

pwurple wrote: »

Indeed. That's why all clothing shops are required to limit the price for clothes, and all bread is the same price, subject to 2% annual increase. Right?

Bull of the highest order. Last time I looked, we were not an annex of Cuba.

Screaming about communism when you can't have your own way doesn't make for a strong argument. It's not 1950s America.

Housing is not like clothes, you can't just manufacture more land*. The current (insane) price of housing is a direct consequence of government restrictions on land use. The resulting insane rents are not the effect of a free market working normally, they are a consequence of regulation.

You want to capture the profitable effects of regulation without the downsides. This is unreasonable.

* OK, you could fill in the Dublin Bay.

Carlos Orange

Maya Defeated Meadow wrote: »

We should be disincentivising people from moving to Dublin anyway

What do you suggest we do to disincentive people from moving to Dublin? Something more effective than current rental prices.

psinno

psinno wrote: »

What do you suggest we do to disincentive people from moving to Dublin? Something more effective than current rental prices.

Disincentivising wasn't really the correct term, its more than we should be removing the requirement for so many people to need (or be forced) to move to Dublin for work rather we should be spreading employment around the country enabling people to live where they are from and get work, have access to much cheaper housing (particularly buying/building etc). This has so many benefits from improving local economies thus creating more jobs (pubs, shops, cafes, creches, schools etc etc), better quality of life, less congestion, shorter commute times, living close to family, better off financially etc etc.

Lumen

Maya Defeated Meadow wrote: »

Disincentivising wasn't really the correct term, its more than we should be removing the requirement for so many people to need (or be forced) to move to Dublin for work rather we should be spreading employment around the country enabling people to live where they are from and get work, have access to much cheaper housing (particularly buying/building etc). This has so many benefits from improving local economies thus creating more jobs (pubs, shops, cafes, creches, schools etc etc), better quality of life, less congestion, shorter commute times, living close to family, better off financially etc etc.

I don't think anyone doesn't want that (well maybe apart from Dublin landlords) but it's not easy to achieve. Expensive rents are a strong disincentive but they're not working.

Say office space costs €500/mo/desk, and the employee pays €1500/mo to house themselves. Perhaps those numbers could be halved somewhere cheaper. That's €1000/mo Dublin tax. And yet still they come.

Actually, it's a bit like traffic. Everyone wants someone else to leave their car at home.

Graham

Lumen wrote: »

You want to capture the profitable effects of regulation without the downsides. This is unreasonable.

You've obviously forgotten that most landlords went through the downsides during the GFC when rents were decimated.

Lumen

Graham wrote: »

You've obviously forgotten that most landlords went through the downsides during the GFC when rents were decimated.

Those were not a consequence of housing market regulation.

If you want a fixed income then buy fixed income.

Graham

Lumen wrote: »

Those were not a consequence of housing market regulation.

If you want a fixed income then buy fixed income.

It would be equally pointless to suggest if you want fixed housing costs, buy a house. :rolleyes:

It would be more sensible (and in everyones interest) to find a way to limit the enormous swings in the market that both landlords and tenants have suffered under.

The current approach of making landlords suffer losses during the bad times and severely limit or eliminate returns during the better times just isn't working.

pwurple

Lumen wrote: »

Screaming about communism when you can't have your own way doesn't make for a strong argument. It's not 1950s America.

Housing is not like clothes, you can't just manufacture more land*. The current (insane) price of housing is a direct consequence of government restrictions on land use. The resulting insane rents are not the effect of a free market working normally, they are a consequence of regulation.

You want to capture the profitable effects of regulation without the downsides. This is unreasonable.

* OK, you could fill in the Dublin Bay.

What's my own way? I want to be able to advertise my property at a price where I don't get 200 phonecalls in an hour, and 50 people asking me to take 500 euro cash above the monthly asking price. It's CLEARLY undervalued, especially as the exact same apartment next door is leased for 700 euro a month more. Everyone I know is telling me I'm nuts for not taking under the table cash payments. God forbid I want some integrity and fairness instead of a blackmarket and a heap of chaos.

Cray cray I know.


And LOL @ you can't manufacture more land. What are you, in the DCC?

Look up buddy. Sky's the limit.


You know what makes people build property, buy property for rent and rent it out? Income from it. It's not a crime to provide a service and charge for it. Unknot the knickers about profit and get your lingo right, because the government class and tax it as income, not profit. It's income. If it WAS profit, I'd be much happier, at 3% tax instead.

Lumen

Graham wrote: »

It would be equally pointless to suggest if you want fixed housing costs, buy a house. :rolleyes:

I don't see how buy vs rent for occupiers is relevant to a discussion on investment returns.

Graham wrote: »

It would be more sensible (and in everyones interest) to find a way to limit the enormous swings in the market that both landlords and tenants have suffered under.

The current approach of making landlords suffer losses during the bad times and severely limit or eliminate returns during the better times just isn't working.

What "losses" are you referring to? Do you mean negative yields, negative cashflow or (unrealised?) capital losses?

__..__

Lumen wrote: »

I don't see how buy vs rent for occupiers is relevant to a discussion on investment returns.



What "losses" are you referring to? Do you mean negative yields, negative cashflow or (unrealised?) capital losses?

Ah come on now.
Are you ALWAYS just pulling the p1ss?

FishOnABike

__..__ wrote: »

Ah come on now.
Are you ALWAYS just pulling the p1ss?

It's a relevant point. Property should be a long term investment, continuous positive cashflow should not be a given.

If I buy an investment property for 300K and rental income after expenses and tax only cover half the ongoing mortgage costs I still have acquired a 300K property for a 150K outlay at the end of the mortgage (for simplicity I have ignored interest -some of it is expenseable anyway) , plus any capital appreciation in the property. I may never have had a positive cashflow but I could still make a reasonable long term return on my investment.

__..__

FishOnABike wrote: »

It's a relevant point. Property should be a long term investment, continuous positive cashflow should not be a given.

If I buy an investment property for 300K and rental income after expenses and tax only cover half the ongoing mortgage costs I still have acquired a 300K property for a 150K outlay at the end of the mortgage (for simplicity I have ignored interest -some of it is expenseable anyway) , plus any capital appreciation in the property. I may never have had a positive cashflow but I could still make a reasonable long term return on my investment.

You do make it sound so easy.
You must be a millionaire by now.
Whats the secret?

FishOnABike

FishOnABike wrote: »

It's a relevant point. Property should be a long term investment, continuous positive cashflow should not be a given.

If I buy an investment property for 300K and rental income after expenses and tax only cover half the ongoing mortgage costs I still have acquired a 300K property for a 150K outlay at the end of the mortgage (for simplicity I have ignored interest -some of it is expenseable anyway) , plus any capital appreciation in the property. I may never have had a positive cashflow but I could still make a reasonable long term return on my investment.

But this is not going to be good enough for most investors and without investors we have the issues we now have with supply issue.

If its not an attracitive long term investment and day to day business people are not going to get involved and why would they.

I really believe there needs to be a drastic reducion in the taxes paid by LLs or allow the full capital repayment of a mortgage to be an expense against tax. This along with giving more power to LLs to choose their tenants, get rid of bad tenants etc and we will attract a lot of people back into the game.

Developers and builders also need to be incentivised with tax breaks to encourage building.

Graham

FishOnABike wrote: »

It's a relevant point. Property should be a long term investment, continuous positive cashflow should not be a given.

Property absolutely should be viewed as a long term investment.

Unfortunately property investment in Ireland is more like high-stakes gambling where the odds are changed on a monthly basis.

_Dara_

pwurple wrote: »

And yes , you're correct. I will take my capital elsewhere. I am waiting for the budget to see if this idiotic RPZ stuff is changed. If not, the rest of my residential units are becoming commercial. All of mine are in mixed unit developments anyway, and there is a hell of a lot of demand for office space in the city. It's a shame, they are nice units, well located, well maintained, and I'll be sorry to lose the tenants, but I feel I have no choice. Im not running a charity or am I part of the local council.

Genuine question here. Say that a magic wand was waved over Dublin and supply massively increased. Rents decreased dramatically bringing market rate below the RPZ caps. You are now able to fully charge what the market will bear but it's lower than the current cap. Would you still leave the residential rental market?