Property Market 2020

coolshannagh28

Graham wrote: »

Out of curiosity, which of the BTR developments have an ultrarich owner?

Most I assume , Greystar an active investor CEO has a 3.7bn net worth .

Graham

coolshannagh28 wrote: »

Most I assume , Greystar an active investor CEO has a 3.7bn net worth .

IIRC they only have the Ballymore development Dublin Landings.

Any others? I recall a few of the REITs are publically traded, pension funds and the like.

Graham

Graham wrote: »

What part of the country bubblypop?

Dublin, castleknock
It's what I have experienced since last summer in this area, Dublin 7 & few close areas

coolshannagh28

Graham wrote: »

IIRC they only have the Ballymore development Dublin Landings.

Any others? I recall a few of the REITs are publically traded, pension funds and the like.

A cursory search revealed that one and there are many more but remember that vultures and hedge funds etc owned by HNI s are also treated favourably in their property acquisitions and these are also impacting on the market .

coolshannagh28

beauf wrote: »

Do you have any links where it was strongly recommended?

It not investment thats creating disadvantage. Its Govt Policy.

Its Govt policy that compounding this housing crisis.

I agree , capital flows to where it can make the highest gain and in Ireland Govt policy is to incentivise this by low taxation but who benefits and why ?

Graham

coolshannagh28 wrote: »

who benefits and why ?

The state by achieving both the broadening of the landlord base/types of landlords and the increased supply of rental accommodation.

I don't buy the "it was done for the gazillionaires" consipracy theory. If we're incentivising investment it stands to reason it's more likely that those with money to invest will be the investors whether they are HNIs or investment funds.

coolshannagh28

Graham wrote: »

The state by achieving both the broadening of the landlord base/types of landlords and the increased supply of rental accommodation.

I don't buy the "it was done for the gazillionaires" consipracy theory. If we're incentivising investment it stands to reason it's more likely that those with money to invest will be the investors whether they are HNIs or investment funds.

That would be a benign view in light of the escalation of rental costs to the point of unaffordability , we are incentivising investment with tax breaks at a scale that excludes most investors ; is this fair even if it could be proved that it was for the greater good ?

Graham

coolshannagh28 wrote: »

That would be a benign view in light of the escalation of rental costs to the point of unaffordability , we are incentivising investment with tax breaks at a scale that excludes most investors ; is this fair even if it could be proved that it was for the greater good ?

Rents will continue to rise until supply improves. This is improving supply.

Governments the world over use taxation to encourage/discourage all types of investment. In this case I expect the tax incentives will be reduced over time as the objectives of increasing supply/broadening the types of landlord are achieved.

beauf

Graham wrote: »

The state by achieving both the broadening of the landlord base/types of landlords and the increased supply of rental accommodation.

It increases the supply where its the most profitable end. It ignores the rest.

Where is the supply most needed. Social and affordable. The least profitable.

beauf

Graham wrote: »

...the objectives of increasing supply/broadening the types of landlord are achieved.

The objective isn't to broaden the type of supply. Its to drive investment in the economy, to drive recovery.
They could care less about anyone left behind in the stampede.

Has supply broadened? Nope.

Graham

beauf wrote: »

The objective isn't to broaden the type of supply. Its to drive investment in the economy, to drive recovery.
They could care less about anyone left behind in the stampede.

Has supply broadened? Nope.

Not what I posted. Read my post again.

Broadening the types of landlord. i.e. reduce the dependence on small private landlords by incentivising institutional investors.

Increase supply, i.e. BTR developments.

beauf

People use sweeping terms like supply as is if its all the same thing. It isn't. Small LL aren't in the same market as the big investors.

What this is doing is increasing supply where it least needed.

https://www.98fm.com/news/hundreds-of-high-rent-luxury-dublin-apartments-lying-empty-971988

Graham

Even if the supply is currently focussed at the upper end of the market, people moving in to these developments free-up properties further down the chain.

Properties that are priced to high won't let. At some point this will force the prices to be dropped.

As the demand at the upper end of the market is satisfied, developments will start to focus on the middle market as can already be seen with the likes of the Vesta Living development.

Cuddlesworth

Graham wrote: »

Rents will continue to rise until supply improves. This is improving supply.

Is it net improving though? At least in the rental market. Or is the mass exodus of individual landlords too large?

The last RTB report in registrations had a 1k increase year on year, q2 2018 to q2 2019. Reported earlier in this thread that 3400 BTL apartments were finished last year, that would have been brought to market.

coolshannagh28

Graham wrote: »

Rents will continue to rise until supply improves. This is improving supply.

Governments the world over use taxation to encourage/discourage all types of investment. In this case I expect the tax incentives will be reduced over time as the objectives of increasing supply/broadening the types of landlord are achieved.

There isn t a hope of this happening , the Govt is beholden to MNCs of all descriptions and there is the same chance of the tax breaks changing as corporation tax increasing . When Michael Noonan went on his American investment tour in 2011 these deals were worked out and while they have obviously brought prosperity to us by increasing property values and property diversification ,they have skewed the market in favour of big capital who are using a quasi monopoly to control the market which in their terms is a small profit rich one.

TSQ

Graham wrote: »

Even if the supply is currently focussed at the upper end of the market, people moving in to these developments free-up properties further down the chain.

Properties that are priced to high won't let. At some point this will force the prices to be dropped.
.....

If residential property trends mirror those of commercial property owned by large conglomerates and investment vehicles, these will remain empty rather than see prices drop. The investment value is based on the theoretical rental income, not on the actual return on investment. That is one reason so many commercial landlords refused to drop rents during the bust, preferring to leave units empty. By reducing rents they would reduce the paper value of the investment and this in turn could leave the owners in breach of covenants (loan to value) with banks. Banks could then demand immediate repayment of any loans. So, unless the government steps in and places a charge on un-let properties, there will be no rush on the part of these large scale landlords to drop rents. If there was a realistic property tax, this would discourage property hoarding, but Morons Before Profit put paid to this.

The_Conductor

TSQ wrote: »

So, unless the government steps in and places a charge on un-let properties, there will be no rush on the part of these large scale landlords to drop rents. If there was a realistic property tax, this would discourage property hoarding, but Morons Before Profit put paid to this.

+1
We need both a realistic property tax- but even more importantly, a vacant property tax. I would argue that it should include the 23,640 vacant properties nationwide that are voluntarily vacant by people availing of the Fair Deal Scheme. Its bonkers that you avail of that scheme and there is no onus on you to let your property. It should be a condition of the scheme.

Mic 1972

TSQ wrote: »

If residential property trends mirror those of commercial property owned by large conglomerates and investment vehicles, these will remain empty rather than see prices drop. The investment value is based on the theoretical rental income, not on the actual return on investment. That is one reason so many commercial landlords refused to drop rents during the bust, preferring to leave units empty. By reducing rents they would reduce the paper value of the investment and this in turn could leave the owners in breach of covenants (loan to value) with banks. Banks could then demand immediate repayment of any loans. So, unless the government steps in and places a charge on un-let properties, there will be no rush on the part of these large scale landlords to drop rents. If there was a realistic property tax, this would discourage property hoarding, but Morons Before Profit put paid to this.

if the landlord has no mortgage to pay there is no ground for breach of covenant. In that case a house could be left empty with no legal consequences

beauf

The_Conductor wrote: »

+1
We need both a realistic property tax- but even more importantly, a vacant property tax. I would argue that it should include the 23,640 vacant properties nationwide that are voluntarily vacant by people availing of the Fair Deal Scheme. Its bonkers that you avail of that scheme and there is no onus on you to let your property. It should be a condition of the scheme.

Its not practical. There are too many legal and practical considerations. Wills and estates can take years to sort out. Even where their are no arguments or conflicts. Never mind if the properties are suitable, which they usually aren't. Even if you could do it. You are basically forcing people to be LLs, and taking on a lot of risk and expense, for little gain. Considering the people who want to be LLs are leaving the market. There is no protection. The only reason you want, or need to do this. Is because the Govt has neglected the provision of housing. Asking OAP's to cover for them is ridiculous.

beauf

Graham wrote: »

Even if the supply is currently focussed at the upper end of the market, people moving in to these developments free-up properties further down the chain.

Properties that are priced to high won't let. At some point this will force the prices to be dropped.

As the demand at the upper end of the market is satisfied, developments will start to focus on the middle market as can already be seen with the likes of the Vesta Living development.

Not if the people moving into these high end properties, are from somewhere else. We are importing high end skilled labour. These properties are aimed at them. Lots of properties left empty. They are investments.

Like a broken clock at some point these predictions will be true the market will decline. But you'll have allowed a housing crisis to exist for generations.

The_Conductor

beauf wrote: »

Asking OAP's to cover for them is ridiculous.

Meanwhile the whole point of the Fair Deal Scheme- is that it allows OAPs leverage their PPR to pay for nursing home fees.

If they're in there for a number of years- the property is going to deteriorate, and suitable location or otherwise- it is vacant...…..

We currently have over 23,600 such vacant residences nationwide- and it beggars belief that no-one has any ideas for a scheme adjustment to get them onto the market (if not the rental market- the open market- make them available for people to buy).

Also- there aren't any estate issues etc- its simply an asset that is being folded into the estate- and if the owner of the property is still with us- they can elect to do whatever they may with the balance of their liquidity- which might be an attractive prospect for some people.

It might also be used as a mechanism to encourage more of co-living arrangements- which are in pitiful supply in Ireland. Its bonkers that we are shovelling our OAPs into nursing homes- when many of them simply need a little more care and attention than they have in their own homes.

One way or the other- there are currently 23,640 vacant residential properties that belong to people availing of the 'Fair Deal Scheme' and this is increasing by a net 4000 units per annum.

Cuddlesworth

The_Conductor wrote: »

I would argue that it should include the 23,640 vacant properties nationwide that are voluntarily vacant by people availing of the Fair Deal Scheme. Its bonkers that you avail of that scheme and there is no onus on you to let your property. It should be a condition of the scheme.

Seems unworkable if I honest.
After tax, 80% of the rental income goes to the state again.
The landlord is in a home, not exactly ideal.
Basically losing their home upon entering the scheme.
Seems like a financial and emotional burden.

Best option would be to force the sale of the home upon entering the scheme. But you would assume most people would just loophole around it.

The_Conductor

Cuddlesworth wrote: »

Best option would be to force the sale of the home upon entering the scheme. But you would assume most people would just loophole around it.

This would be the sanest option.
Having a growing number of vacant properties, around the country, deteriorating and falling into disrepair- for however long a person lives out their twilight in a nursing home- just isn't good for anyone. I doubt the OAP in the retirement home is happy with the fact that his roof has developed a leak, his gutters are blocked, windows are broken- and his garden looks like an attempt at rebirthing a rain forest. Of course they're in a nursing home- so they don't necessarily see this.

It would have to be packaged up in some sort of a satisfactory manner so that the OAP saw it was in their interests to sell the property rather than leave it vacant- but the current lack of any consideration for all those properties- is nothing short of scandalous.

The Fair Deal Scheme costs a cool billion Euro per annum- and even with the clawback on the PPR- is not run on a cost recovery basis- which is not what was decreed when the scheme was setup.

These properties are going to hit the market anyhow- however, leaving tens of thousands of properties to deteriorate for a number of years- is just mind boggling- there has to be a better way of managing housing stocks...…….

Why not put them on the open market- to establish a market price, then roll them into local authority housing stock- so they'd be taken good care of.

We actually have these 23,640 (and growing by 16% per annum) numbers of vacant properties- and no-one is discussing them- they are untouchable, because the family home is sacrosanct- but its no longer a family home if the homeowner is in a nursing home...……..

beauf

The_Conductor wrote: »

Meanwhile the whole point of the Fair Deal Scheme- is that it allows OAPs leverage their PPR to pay for nursing home fees.

If they're in there for a number of years- the property is going to deteriorate, and suitable location or otherwise- it is vacant...…..

We currently have over 23,600 such vacant residences nationwide- and it beggars belief that no-one has any ideas for a scheme adjustment to get them onto the market (if not the rental market- the open market- make them available for people to buy).

Also- there aren't any estate issues etc- its simply an asset that is being folded into the estate- and if the owner of the property is still with us- they can elect to do whatever they may with the balance of their liquidity- which might be an attractive prospect for some people.

It might also be used as a mechanism to encourage more of co-living arrangements- which are in pitiful supply in Ireland. Its bonkers that we are shovelling our OAPs into nursing homes- when many of them simply need a little more care and attention than they have in their own homes.

One way or the other- there are currently 23,640 vacant residential properties that belong to people availing of the 'Fair Deal Scheme' and this is increasing by a net 4000 units per annum.

Sorry but this is all fantasy. Its completely devoid of any understanding of the realities.

beauf

The_Conductor wrote: »

Meanwhile the whole point of the Fair Deal Scheme- is that it allows OAPs leverage their PPR to pay for nursing home fees....

You haven't even got this bit right. The fair deal only takes max 7.5%x3yrs of the PPR, and then only the part that the person in the home owns. They may not be the sole owner. It will not cover the cost of the nursing home over the persons lifetime, which can be 60~100k a year, unless its a very expensive property and/or the person doesn't live that long and/or the 7.5% is the same as the yearly cost of the care. If you sell the house and put the cash in the bank, it takes 7.5% every year as long as the person is in care. The person can outlive the value in the house.

The rest of your ideas are similarly off...

Cuddlesworth

Part of changing how the scheme works, involves changing the scheme.

You could easily say sale of house, sale cost minus 7.5% over 3 years, remaining cash exempt.

beauf

Cuddlesworth wrote: »

Part of changing how the scheme works, involves changing the scheme.

You could easily say sale of house, sale cost minus 7.5% over 3 years, remaining cash exempt.

Who pays the cost of selling the house, all the tax, do you rip up the will, do you kick out any family still in the house. Who pays to bring he house up to standard. Who pays all the legal fees for this. How long does it all take. What do you do with their stuff. Who pays for the storage of this stuff. There may be other costs to be borne by the estate, they might have other debts, funeral costs.

Instead of this why don't the Govt just buy/build properties in the first place and rent them. Like they used.

TSQ

beauf wrote: »

....

Instead of this why don't the Govt just buy/build properties in the first place and rent them. Like they used.

and leave perfectly good homes go to rack and ruin? If the govt can legislate for a derelict site tax, impose rules for landlords in rent pressure zones, etc, no reason why they cant legislate for a derelict homes tax, or better still, for an empty dwelling tax in rent pressure zones. The Housing Together scheme could surely be tweaked to facilitate loans to do up houses for long term social housing (the 10 year lease would be short enough to suit someone going in to care, and their families).

0gac3yjefb5sv7

Overall, do people think the Dublin market is picking up again? With a steady rise throughout the year or is it just Jan/Feb being busy now that Brexit is over and it will slowdown later this year.

anplaya27

How much would ye bid under a houses asking price or would ye offer what they are asking ? Similar houses have sold in the last few months 20000 of what they are currently asking.