Increase in population renting... ticking time bomb?

PokeHerKing

Sleeper12 wrote: »

Dr_Kolossus wrote:

So the state should build houses, rent them at reduced rates then sell them at a loss?

This never happened in the past. They always made a profit.

Why do you now suggest that they should make a loss? Terrible idea imo. Stick to the old plan and make a profit

They may have made a profit but they sold houses to people up to 70% less than market value at the time.

Sleeper12

Franz Von Peppercorn wrote:

They shouldn’t be sold though as it reduces the further income the councils can earn.

Not if they keep building. Many were built purposely to be sold later on. They stop building and the chain broke.

Don't forget we are talking about families on minimum wage here. Families that will still be on minimum wage in 20 years time. It's to give these people a chance. Plus without building the homes we'll continue to pay millions in HAP. Building homes is cheaper in the long run

Franz Von Peppercorn

Sleeper12 wrote: »

Not if they keep building. Many were built purposely to be sold later on. They stop building and the chain broke.

Don't forget we are talking about families on minimum wage here. Families that will still be on minimum wage in 20 years time. It's to give these people a chance. Plus without building the homes we'll continue to pay millions in HAP. Building homes is cheaper in the long run

Oh I agree with public housing - just not the selling of housing. You are right though, they should have kept building.

Sleeper12

PokeHerKing wrote:

They may have made a profit but they sold houses to people up to 70% less than market value at the time.

70 percent less than market value after they paid rent for 30 or 40 years. Not 70 percent less than market value first day in the house.

You are getting your figures mixed up. The final amount they actually paid for the house varied depending on how much rent they paid over the 30 or 40 years

GingerLily

Sleeper12 wrote: »

70 percent less than market value after they paid rent for 30 or 40 years. Not 70 percent less than market value first day in the house.

You are getting your figures mixed up. The final amount they actually paid for the house varied depending on how much rent they paid over the 30 or 40 years

So people paying low rent rates got a fantastic deal!

Claw Hammer

Sleeper12 wrote: »

70 percent less than market value after they paid rent for 30 or 40 years. Not 70 percent less than market value first day in the house.

You are getting your figures mixed up. The final amount they actually paid for the house varied depending on how much rent they paid over the 30 or 40 years

Rent is rent. It has nothing to do with a purchase price. If they had been renting privately for 30 or 40 years, they would have had to pay the full price for any house they sought to buy even the one they're living in.

Browney7

PokeHerKing wrote: »

I agree with half of your post. Rates are definitely a big part of the problem. People paying the council 50e a week to live in Dublin city centre is bonkers.
I do not agree with selling the house onto social welfare recipients. The governments housing stock has diminished for two reason, not building and selling existing stock.
Bring back proper rates where people still need to work to pay the council a reduced rent and use this money to build new stock. Build different types of social housing and move people out of family homes into smaller social housing when they're older. They die there and the cycle is full circle.
DO NOT sell them this property at a reduced rate. That is complete nonsense and you would really have to ask yourself what idiot ever thought it was a good idea!

The flip side of this is that the fall off in social housing provision and construction has fuelled massive increases in rent and house prices making the deals people received look like gold plated ones (not saying I agree with the sell off but politics has always been based on people buying their properties thus creating likely voters for establishment parties - politicians playing politics essentially. Lorcan Sirr had an interesting article recently on this).

The state not building any significant volumes has been a boon for people who own their homes and for REITs and landlords with capital values dramatically increasing.

As for people saying half the rent will come back in tax - if the state start paying HAP style payments to large REITs to provide "affordable housing" it won't. Significant lobbying going on regarding build to rent schemes with 20 year leases to the state in order to cook the books to make it appear all is great with Ireland inc and the debt levels.
Beneficiaries will be Canadian and US pension funds which are tax exempt in Ireland so it will be a significant loss of wealth to the country.

Franz Von Peppercorn

Franz Von Peppercorn wrote: »

You’re not following this thread. It’s getting harder to buy and some renters are stuck for life. Also they buy later. This is a large constituency for political votes.

I am following the thread .......... you said "majority of people are in the rental sector " & I said it'll be a while before that is the case.

Sleeper12

Sleeper12 wrote: »

...........

Don't forget we are talking about families on minimum wage here. .........

Please do explain how we are talking about families on the minimum wage.

Mrs OBumble

Sleeper12 wrote: »

70 percent less than market value after they paid rent for 30 or 40 years. Not 70 percent less than market value first day in the house.

In many cases the differential rent doesn't cover the actual cost of rental administration, maintenance, insurance and estate management.

ELM327

people also forget that "rent" is due for the commodity of having the property to live in.
Rent does not form part of the purchase price, and should not be presented as such

Sleeper12

GingerLily wrote:

So people paying low rent rates got a fantastic deal!

Ffs some people just begrudge someone worse off than them getting a leg up in life!

Sleeper12

Claw Hammer wrote:

Rent is rent. It has nothing to do with a purchase price. If they had been renting privately for 30 or 40 years, they would have had to pay the full price for any house they sought to buy even the one they're living in.

This is called social housing. It's not there to make a profit even though it does.

What is your solution? Keep paying millions to private landlords on a weekly basis with nothing to show for it after decades?

Sleeper12

Sleeper12 wrote: »

Ffs some people just begrudge someone worse off than them getting a leg up in life!

A leg up?
Get a house for tiny rent for decades and then buy it for 30% market value.
That's a hell of a leg up.

GingerLily

Sleeper12 wrote: »

Ffs some people just begrudge someone worse off than them getting a leg up in life!

No, you said that they they paid for it in rent, I pointed out not everyone would have made rent payments to service the costs - it's not begrudgery, it's maths.

Claw Hammer

Sleeper12 wrote: »

This is called social housing. It's not there to make a profit even though it does.

What is your solution? Keep paying millions to private landlords on a weekly basis with nothing to show for it after decades?

It makes no profit! The buildings have to be constructed and maintained and they are eventually sold off. The reason for selling them off is to transfer the maintenance costs onto the tenant. Not selling the houses might increase the housing stock, but would cause a problem with the occupier profile. The more enterprising tenants would trade out to private housing and fresh tenants would be introduced frequently. This will slow down or prevent the areas stabilising. Social housing should be integrated with private housing, but should not be sold on at other than market value.

cruel_barber

Sleeper12 wrote: »

This is called social housing. It's not there to make a profit even though it does.

What is your solution? Keep paying millions to private landlords on a weekly basis with nothing to show for it after decades?

how about removing moral hazard where if a local authority tenant ( where rent is a pittance ) go into arrears , they dont get to remain in situ

this would entice councils to build , councils dont want to be in the business of paying for housing , the risk of not getting paid is too large , you must remember that the landlord in receipt of HAP takes on significant risk in sofar as if the tenant stops paying their agreed contribution to the local authority , the council cease paying rent to the landlord and not only that , its up to the landlord to then evict the tenant which of course will be frustrated by the RTB and whatever left wing TD decides to put their oar in

much of the housing crisis is related to the entitlement culture which has grown into an industry this past few decades , its not simply down to a malevolent FG and " greedy landlords "

the likes of HAP is cheaper for the state , that various left wing politicians , media and professional do gooders are irate is purely down to ideology , they hate anyone with private property making money full stop

Sleeper12

Mrs OBumble wrote:

In many cases the differential rent doesn't cover the actual cost of rental administration, maintenance, insurance and estate management.

But we are paying private landlords millions right now. It's still millions cheaper for the council to build & and rent

cruel_barber

Sleeper12 wrote: »

But we are paying private landlords millions right now. It's still millions cheaper for the council to build & and rent

no it isnt !

the landlord has to maintain the house , never mind ( in most cases ) had to borrow to buy it , he also has to deal with a tenant who withholds rent and add to that needs two years to evict said tenant who goes rogue , further to that , landlords have been made public enemy number one by an ideologically leftist media , if the councils filled the role of private landlords , it is they who would feel the righteous anger of RTE and RBB , why would the councils want all that hassle ?

Sleeper12

GingerLily wrote:

No, you said that they they paid for it in rent, I pointed out not everyone would have made rent payments to service the costs - it's not begrudgery, it's maths.

Your maths does not add up to. We are paying millions to private landlords right now. It's millions cheaper to build and rent and sell. It's simple maths. This maths worked in the 60's, 70s and 80's.

Again it is social housing. It's not supposed to make a profit. Private landlords are the only ones making a profit right now with the present setup

cruel_barber

Sleeper12 wrote: »

Your maths does not add up to. We are paying millions to private landlords right now. It's millions cheaper to build and rent and sell. It's simple maths. This maths worked in the 60's, 70s and 80's.

Again it is social housing. It's not supposed to make a profit. Private landlords are the only ones making a profit right now with the present setup

do you think the money local authorities spend is found on trees ?

it suits the state to outsource this area to private landlords

its not that complicated if you take off the ideological glasses

antoinolachtnai

Sleeper12 wrote: »

Your maths does not add up to. We are paying millions to private landlords right now. It's millions cheaper to build and rent and sell. It's simple maths. This maths worked in the 60's, 70s and 80's.

Again it is social housing. It's not supposed to make a profit. Private landlords are the only ones making a profit right now with the present setup

It actually adds up just fine. The state can house a family in a 2-bed apartment for 600 euros a month net in dublin including service and maintenance and without the government needing to borrow a euro.

It will never be cheaper than this to build council housing. There is just no way to make it add up.

That doesn’t change the actual fundamental problem. There aren’t enough homes for the number of families in the city.

the real disconnect in this debate is how some ppl really seem to fail at getting their heads around something extremely basic:

the state does not exist to provide agreed and basic necessary service to its citizens at a profit

that "at a profit" which appears to be sticking in throats is an absolutely bizarre clause that exists only in your imagination folks

the debate is: what level of housing, at what balance of costs to state/renter (or owner) and with what genuflection towards location preference, etc

the debate is: what does housing as a basic fundamental right actually mean, and how much can the govt leave to the free market?

the debate is not "can it be done at a profit"

imagine if the debate was: what could all the govt and private resources currently going into housing provide for our citizens if we didnt divide along lines of ideology/income immediately but looked at the value we were getting from property and construction

imagine if the questions were "who is profiting from this macroeconomic mess?" instead of "do i know an individual getting a cheap house'

Claw Hammer

Sleeper12 wrote: »

Your maths does not add up to. We are paying millions to private landlords right now. It's millions cheaper to build and rent and sell. It's simple maths. This maths worked in the 60's, 70s and 80's.

Again it is social housing. It's not supposed to make a profit. Private landlords are the only ones making a profit right now with the present setup

The mats did not work in the 60s, 70s and 80s. The houses were built with money raised from taxation, no profit accrued to the councils. Up to 1977 the council had income from domestic rates. That's where the money came from to build houses. It did not come from the rents the councils were collecting.

tom1ie

Is there any country in the world where a builder and the tradesmen on site are paid a salary by the state regardless of what price the final product (the house) is sold for.
For example if the state becomes the main contractor and employs different tradesmen (or trades people, before people start kicking off!) and pays them a salary, this will remove the profiteering element that is jacking up our house prices at the moment.
The state has enormous resources to buy materials in bulk, thus lowering the cost of material. Land can be provided by Nama or cie etc for free for AFFORDABLE housing. V.a.t can be exempted as there is not much point in the government taxing itself.
All this would result in prices being a whole lot less when you factor in the economy of scale.
This would result in ftb’s taking on a lot less debt which would break the vicious cycle we as a nation are caught up in.

Now obviously the current builders and developers will cause bloody murder over an idea like this. Tom parlon wouldn’t be off the radio giving out about it, but unless we do something to bring the prices of the houses down we’ll be stuck in this ever worsening loop until the next crash, and then we’ll have to take on more sovereign debt to bail out more banks, as banks had to lend more to keep up with ever increasing prices due to, you got it, profiteering and greed.

Just to point out I am not talking about social housing here and it’s associated maintance costs, I’m talking about AFFORDABLE housing where the state can afford to build houses at a much lower cost base then a developer/builder can (or let’s on he can) and then sells that house for no profit.

Claw Hammer

tom1ie wrote: »

Is there any country in the world where a builder and the tradesmen on site are paid a salary by the state regardless of what price the final product (the house) is sold for.
For example if the state becomes the main contractor and employs different tradesmen (or trades people, before people start kicking off!) and pays them a salary, this will remove the profiteering element that is jacking up our house prices at the moment.
.

this is exactly what the Councils used to do. They then discovered that it was costing more to build houses this way than they could by houses on the open market for. Paying wages and salaries leads to unionisation and inefficiencies. It costs more to build a house or apartment than the equivalent second-hand house can be bought for. It is simply not economic to build houses other than certain types. The cost of the land as the biggest variable rather than the builders profit in providing new building.

cruel_barber

Claw Hammer wrote: »

this is exactly what the Councils used to do. They then discovered that it was costing more to build houses this way than they could by houses on the open market for. Paying wages and salaries leads to unionisation and inefficiencies. It costs more to build a house or apartment than the equivalent second-hand house can be bought for. It is simply not economic to build houses other than certain types. The cost of the land as the biggest variable rather than the builders profit in providing new building.

also needs to be pointed out that building standards are light years more strict today than in the golden age of council house building

standards from 2008 are well behind 2018 , this adds major cost

GingerLily

Sleeper12 wrote: »

Your maths does not add up to. We are paying millions to private landlords right now. It's millions cheaper to build and rent and sell. It's simple maths. This maths worked in the 60's, 70s and 80's.

Again it is social housing. It's not supposed to make a profit. Private landlords are the only ones making a profit right now with the present setup

That's not simple maths, that's made up numbers, pulling figures from the air.

Building and renting might be cost effective, but selling heavily discounted years later is not.

Wanderer78

tom1ie wrote:

Is there any country in the world where a builder and the tradesmen on site are paid a salary by the state regardless of what price the final product (the house) is sold for. For example if the state becomes the main contractor and employs different tradesmen (or trades people, before people start kicking off!) and pays them a salary, this will remove the profiteering element that is jacking up our house prices at the moment. The state has enormous resources to buy materials in bulk, thus lowering the cost of material. Land can be provided by Nama or cie etc for free for AFFORDABLE housing. V.a.t can be exempted as there is not much point in the government taxing itself. All this would result in prices being a whole lot less when you factor in the economy of scale. This would result in ftb’s taking on a lot less debt which would break the vicious cycle we as a nation are caught up in.

Does the fact, banks actually create the majority of our money through loans, also cause the price of houses to rise?

DubCount

Question: What is an affordable home? By the time we pay the going rate for materials, labour, planning and meeting building regulations, the cost of a home (with or without profit) is just not what people think is affordable. If experienced developers cant make the maths work, I cant see how our bureaucratic Councils can. If we want real affordable housing, we need to look at standards, minimum size requirements etc. Wishing it could be more affordable wont help.

Question: What level of social housing are we prepared to pay for? What level of taxes are we prepared to pay and what kind of housing do we provide to those that dont (cant or wont) contribute. Is it fair that one person works overtime/2 jobs and cuts out all social life to pay for a home, should be living next door to someone who has the same house provided free from the state. I would like to live in a large house with a sea view in Killiney - that is something my income does not allow - should the government provide that to me.