Cuckoo fund and housing market

Sheepdish1

What are people’s opinion on these type of purchases? Is this a good way to help solve housing crises or is it pushing normal buyers out of the market with the view to charging crazy rents to renters?

Would like to hear people’s opinion on this please
Thanks

https://m.independent.ie/business/commercial-property/cairn-sells-150-homes-in-kildare-to-cuckoo-fund-for-53-5m-38734042.html

mikhail

Sheepdish1 wrote: »

Is this a good way to help solve housing crises or is it pushing normal buyers out of the market with the view to charging crazy rents to renters?

This is the real world, as opposed to political manifesto land, so it's doing both of those things. It's a source of investment encouraging housing stock to be built, which is good, and it's also a transfer of wealth from renters to capitalists, which is bad.

James Brown

It's bad during a housing crisis. It's making a commodity out of a necessity.
During this ongoing crisis we should be discouraging such things. The average tax payer can't compete with companies buying up around them and prices need not fall because properties are being sold.
The idea that simply having more builds is a good thing is not the case. More houses tax payers can't afford to buy. More high rentals tax payers can't afford to rent.

The government (national/local) feed the crisis in three ways:
1) Making lot property purchase attractive, with low taxation for vulture funds, (yeah cuckoo sounds more palatable).
2) Buying and renting off these people at market rates, basically providing custom.
3) Subsidising low income people so they can rent privately at the exorbitant rates the market sets.

The bottom will fall out. We are using tax payer money to support tax payers in an ever growing number.

The only way more private builds is a plus is if they flood the market to such an extent that prices drop and that's not going to happen. These vulture funds should be taxed very heavily to discourage them.

BENDYBINN

Nearly every TD has a large property portfolio. It’s in their interest to keep rents and property prices high. Don’t expect change any time soon...

ednwireland

the councils are buying up more property than cuckoo funds buy all accounts

IK09

ednwireland wrote: »

the councils are buying up more property than cuckoo funds buy all accounts

The Councils are buying the properties as turn key developments on sites which developers purchased from (in some cases) NAMA...

or where the developer couldnt get planning permission for reasons such as City and county development plans...only for the council to say...you can build them but we have exclusive rights on purchase.

It just happened in my locality, and it cost the tax payer €14.5m for 49 social houses.

Its a disgrace in some cases, and its necessary in others.

osarusan

What's grim is that this US investment company pretty much publicly announced their intention, more than a year ago, to take advantage of the housing crisis will a billion dollar fund, and a year later, what obstacles have been put in their way?

jam_mac_jam

Institutional landlords are more likely to do things properly. Its not all about first time buyers people also need to rent. The less accidental landlords who seem to think they are doing the tenants a huge favour by carrying out the most basic of things can only be good for those renting.

In the wonderous utopia of Germany that we hear so much about a high proportion of homes that are rented are institutionally owned. The sky does not fall down.

Cuckoo funds is a new one though.

blanch152

Sheepdish1 wrote: »

What are people’s opinion on these type of purchases? Is this a good way to help solve housing crises or is it pushing normal buyers out of the market with the view to charging crazy rents to renters?

Would like to hear people’s opinion on this please
Thanks

https://m.independent.ie/business/commercial-property/cairn-sells-150-homes-in-kildare-to-cuckoo-fund-for-53-5m-38734042.html

For decades, Ireland has had a very strange housing market.

House ownership at any cost has been a societal goal. This has had serious implications for our economic development and spatial strategy, as the location of skills availability has not always matched the location of job availability. The fixed nature of house ownership has meant that neither labour not capital have been mobile.

Capital has only wanted to invest in Dublin because that is the only place you can guarantee an adequate supply of labour, and the only place that has had even an embryonic rental market to allow for the importation of labour.

Government policies over the decades have not helped, the cheap sell-off of social housing to tenants has not only meant a transfer of wealth from the many to the few, but also reduced the amount of flexibility and fluidity in the market. Traditionally high stamp duties on property as well as tax incentives for buying have also contributed to the inflexibility.

Within the miniscule rental market, it has traditionally been dominated by small-scale landlords. Whether it is gardai investing their overtime earnings, or small rural businessmen buying a house for their kids in college that turns into a rental property in the longer term, we have a class of what you might call unprofessional landlords.

Therefore, the entry into the market of professional landlords has to be welcomed. Calling them cuckoo funds is a typical Irish begrudgery. Nonetheless, there is some truth in them competing with first-time buyers for new properties. Why? Well, many of the inflexibilities above still remain. Transaction costs, the lack of availability of properties, the tradition of small-scale landlords which makes it hard to buy in bulk, all mitigate against a professional landlord buying existing properties, hence they look at new builds.

What can be done? Increase building heights, particularly in Cork, Limerick, Galway and other regional cities. Increase building density in those cities as well. Concentrate economic development in those cities. All there in Project Ireland 2040. That will lead to more houses being built and plenty of room for all.

randomspud

BENDYBINN wrote: »

Nearly every TD has a large property portfolio. It’s in their interest to keep rents and property prices high. Don’t expect change any time soon...

It's actually less than a third of them that are landlords but let's not have facts get in the way of another rant.

BattleCorp

Works out at about €355k per house. The fund aren't getting them cheap.

BENDYBINN

randomspud wrote: »

It's actually less than a third of them that are landlords but let's not have facts get in the way of another rant.

I suppose you believe in the tooth fairy as well...

Heres Johnny

BattleCorp wrote: »

Works out at about €355k per house. The fund aren't getting them cheap.

So the builder did well. I studied economics in university and most of our lecturers favoured laissez-faire economics, that of non government intervention in markets, let supply and demand dictate. I've an economists thinking cap on usually as opposed to a socialists and normally I think if someone can't afford something, feck them, get a better job or work harder. But cuckoo funds in a housing market is intervention in a different way, feel kinda sorry for people looking to buy a house and denied the opportunity because of a cuckoo fund