Rent Freeze - the mechanics of

Antares35

Fann Linn wrote: »

3 month ban on evictions just passed plus freeze on rent increases in Ireland.

Where can we read about this?

Fann Linn

Antares35 wrote: »

Where can we read about this?

Live on rte 1 as we speak from Dail Eireann

Antares35

Fann Linn wrote: »

Live on rte 1 as we speak from Dail Eireann

Thanks!

Samuel T. Cogley

In practical terms it makes no difference. No Judge was going to give an eviction order given the current situation anyway. Anyone unable to pay now was looking at a year before eviction was likely anyway.

Zulu

Samuel T. Cogley wrote: »

In practical terms it makes no difference. No Judge was going to give an eviction order given the current situation anyway. Anyone unable to pay now was looking at a year before eviction was likely anyway.

And no eviction process started now or over the coming weeks would get to a point of eviction within the 3 months.

Someone acting the maggot months ago however, a LL who has been trying to evict someone due to arrears or antisocial behavior for the past year is now screwed!?!

LuckyLloyd

Just formalises what we all knew to be the case.

Antares35

What happens where the tenant is still employed and hasn't had a pay cut? Presumably they will be required to keep paying their rent and LL in turn will be required to keep paying their mortgage? If LL needs to show proof to bank that no rent/ income is being received in order to avail of the 3 month break, then does a tenant also need to prove same?

Fann Linn

Antares35 wrote: »

What happens where the tenant is still employed and hasn't had a pay cut? Presumably they will be required to keep paying their rent and LL in turn will be required to keep paying their mortgage? If LL needs to show proof to bank that no rent/ income is being received in order to avail of the 3 month break, then does a tenant also need to prove same?

Paschal said something like that last night. I'm sure the fine details will come out later today.

Spencer Winterbotham

Zulu wrote: »

So your plan is to cut your income off now and get in before the rush is it?

Are you expecting the breakdown of society?


Well there's a third type apparently - one that give ups their income voluntarily for the benefit of those who might or might not need it.
Fair play to you.

Ok.. I will explain. I have a portfolio of several houses and apartments... I cancelled all Mortgage Direct Debits.. So I will not be paying any mortgages for the foreseeable... with or without the bank's consent.

All my tenants are casual type workers... they are all unemployed now... I know they can't pay..

I have no idea how this will end but if you think things will return to the way they were you are wrong.

The entire world economy is going to stop.... do you understand what that means?

Even in the hardest times of the recent recession or the depression 100 years ago... there was still economic activity...

All economic activity is stopping... the gears that keep the world economy driving are grinding to a stop...

This has never happened before.

There is no amount of government money in the world that can keep the show on the road for another month... let alone another 6 - 18 months.. things are going to change.

Really, really think about that.

tom1ie

This thread right here is why I wouldn’t want to be a landlord.
Tenants cannot see this from a landlords point of view.
If I’m an owner occupier and I loose my job, fair enough I don’t have to pay my mortgage as I get a break, but do ya think the bank is going to be out of pocket on this?
Will they fcuk. They add the interest on to the remainder of the loan.
In the same way think of the LL with the mortgage, they get hit with the interest paid over the remainder of the mortgage but do they get more pay off the tenant?
Do they fcuk.

PommieBast

Antares35 wrote: »

What happens where the tenant is still employed and hasn't had a pay cut? Presumably they will be required to keep paying their rent and LL in turn will be required to keep paying their mortgage? If LL needs to show proof to bank that no rent/ income is being received in order to avail of the 3 month break, then does a tenant also need to prove same?

I would not be surprised if for some people quitting their job just to get the rent write-off would actually make economic sense.


..or ask their company to change which bank account salary is paid into

sbsquarepants

Spencer Winterbotham wrote: »

Ok.. I will explain. I have a portfolio of several houses and apartments... I cancelled all Mortgage Direct Debits.. So I will not be paying any mortgages for the foreseeable... with or without the bank's consent.

All my tenants are casual type workers... they are all unemployed now... I know they can't pay..

I have no idea how this will end but if you think things will return to the way they were you are wrong.

The entire world economy is going to stop.... do you understand what that means?

Even in the hardest times of the recent recession or the depression 100 years ago... there was still economic activity...

All economic activity is stopping... the gears that keep the world economy driving are grinding to a stop...

This has never happened before.

There is no amount of government money in the world that can keep the show on the road for another month... let alone another 6 - 18 months.. things are going to change.

Really, really think about that.

Have you been drinking the hand sanitiser or something?

All economic activity is not stopping or anything like it.

Where I work we have a lot of CNC machinery which comes from a company in northern Italy, roughly halfway between Milan and Genoa - last week we had need to order some spare parts for one of the machines and it was just business as usual, and this is while the country is in lockdown.

shreko

I don't see how people think that this will have no impact on the LL. I am an accidental landlord, bought a house years ago and now live in my husbands house. The last thing I want to do is take out a payment break on my mortgage. The assumption is that it just adds the three months to the end of the term, not so. You will still be charged the interest each month which will be added on to the Capital. So for me this will be about €2400 added on to my mortgage at the end of the three months. Not to mention the additional interest I will pay on that €2400 over the term of the mortgage. Its a huge financial hit for the landlord and not all of us are loaded. We are just a normal family and cant afford to cover someone elses rent for three months.

Im not going to be an asshole about it, obviously if my tenants lose their jobs I will discuss alternatives with them and try and come up with a fair solution but just taking on their housing costs for three months is impossible for us and unfair to make it my responsibility. If they are unemployed shouldnt they be entitled to rent allowance ?

tom1ie

tom1ie wrote: »

This thread right here is why I wouldn’t want to be a landlord.
Tenants cannot see this from a landlords point of view.
If I’m an owner occupier and I loose my job, fair enough I don’t have to pay my mortgage as I get a break, but do ya think the bank is going to be out of pocket on this?
Will they fcuk. They add the interest on to the remainder of the loan.
In the same way think of the LL with the mortgage, they get hit with the interest paid over the remainder of the mortgage but do they get more pay off the tenant?
Do they fcuk.

Excuse my ignorance but wouldn't the interest be a fraction of the monthly rent?

tom1ie

[Deleted User] wrote: »

Excuse my ignorance but wouldn't the interest be a fraction of the monthly rent?

So? Will the tenant pay extra to the LL as he’s out of pocket?
Nope.
Also it wouldn’t be a small amount depending on the size of the mortgage. There is a few examples explained in earlier posts.
At one time I considered taking on a buy to let mortgage. Thank the high heavens I didn’t.

shreko

Deleted User wrote: »

Excuse my ignorance but wouldn't the interest be a fraction of the monthly rent?

Nope unfortunately not for everyone, depends on your interest rate and where you are in the term of your mortgage. The rent I receive every month is €1200. My mortgage is €1140.
The interest I pay out of the €1140 is approximately €800. So during my "Payment Holiday" for each month I lodge nothing to my mortgage account the €800 interest gets added to the over all debt amount. So If owe €200,000 today in three months time when my "Payment holiday" is over I will now owe €202,400

So I am basically taking on the majority of my tenants housing costs for three months.

This doesnt even consider the monthly direct debit I also have for House Insurance, property tax and Boiler servicing on the property which amounts to another €100 or so a month.

sbsquarepants

shreko wrote: »

I don't see how people think that this will have no impact on the LL. I am an accidental landlord, bought a house years ago and now live in my husbands house. The last thing I want to do is take out a payment break on my mortgage. The assumption is that it just adds the three months to the end of the term, not so. You will still be charged the interest each month which will be added on to the Capital. So for me this will be about €2400 added on to my mortgage at the end of the three months. Not to mention the additional interest I will pay on that €2400 over the term of the mortgage. Its a huge financial hit for the landlord and not all of us are loaded. We are just a normal family and cant afford to cover someone elses rent for three months.

I'm in much the same boat myself, but it is what it is and it's just not that huge a hit all things considered. Yes the interest will still be charged and it will be added to the capital at the end of the 3 months, but even on a small mortgage adding an extra couple of grand is not going to make a whole lot of difference.

You may end up paying 4 or 5 grand extra but it's over the life of the mortgage - no one is going to ask you to pony up 5k tomorrow or the next day.

In my own case i have about 10 years left to pay on the mortgage so lets take 5k as the overall cost, that's €41 a month on the repayments, or a few extra payments at the end.

It's a pain in the arse but it's hardly life changing.

dharma200

Rents already plummeting on daft.

If it wasnt the virus it was going to be something else.

Thats the facts of it.

Rents will have to drop wether landlords like it or not. I expect the adjustment should be made sooner rather than later because there wont be queues of tennants anymore to replace the ones that are going to walk.

Antares35

dharma200 wrote: »

Rents already plummeting on daft.

If it wasnt the virus it was going to be something else.

Thats the facts of it.

Rents will have to drop wether landlords like it or not. I expect the adjustment should be made sooner rather than later because there wont be queues of tennants anymore to replace the ones that are going to walk.

Walk to where? People still need a roof over their head.

shivermetimber

One idea would be to consider rewinding the clock so to speak - a mandatory reduction of all rents back to 2014(?) rates across the board. Any new tenancies commenced since then will also be reduced to the 'going market rate' for the size and area at that time according to the index. This would apply to both private and commercial landlords.

It would remove the max 4% rpz year on year increases, which I imagine nearly every landlord has done to the max of 4% every time and remove the more then 4% increases done outside rpz's. It would reduce rents across the entire country in one swoop, which lets face it has gone beyond ridiculous at this stage and supply isn't going to fix this crisis any time soon.

Of course it won't suit some e.g. very recent landlords who might have stretched themselves mortgage wise if their rental income were suddenly cut but I imagine it will be a more acceptable measure to a lot of longer term landlords given the situation everyone now finds themselves in.

Just a quick though and the above could of course be supplemented with various other measures.

sbsquarepants

dharma200 wrote: »

Rents already plummeting on daft.

If it wasnt the virus it was going to be something else.

Thats the facts of it.

Rents will have to drop wether landlords like it or not. I expect the adjustment should be made sooner rather than later because there wont be queues of tennants anymore to replace the ones that are going to walk.

Because once this disease runs it's course all the people who needed a place to live last week (remember the housing crisis, it was a big thing in the news recently) they will all magically have houses??

Zulu

Spencer Winterbotham wrote: »

Ok.. I will explain. I have a portfolio of several houses and apartments... I cancelled all Mortgage Direct Debits..

Did your tenants contact you first, or was this a preemptive strike?

So I will not be paying any mortgages for the foreseeable... with or without the bank's consent.

A dangerous game. You're a braver man than me thats for sure. I'd have been talking to the bank first myself.

All my tenants are casual type workers... they are all unemployed now... I know they can't pay..

All of them? Wow thats unfortunate. How many people was that in the several properties?

The entire world economy is going to stop.... do you understand what that means?

No I dont. What does it mean?

Really, really think about that.

...you weren't in the SAS by any chance?

dharma200

sbsquarepants wrote: »

Because once this disease runs it's course all the people who needed a place to live last week (remember the housing crisis, it was a big thing in the news recently) they will all magically have houses??

No,
Because air b n b will be pretty much finished, air travel will be extortionate, people all over europe too skint to spend a week in dublin or galway, no more big cultural events, mass unemployment and no more false rental economy.

Have a big long think.

shreko

sbsquarepants wrote: »

I'm in much the same boat myself, but it is what it is and it's just not that huge a hit all things considered. Yes the interest will still be charged and it will be added to the capital at the end of the 3 months, but even on a small mortgage adding an extra couple of grand is not going to make a whole lot of difference.

You may end up paying 4 or 5 grand extra but it's over the life of the mortgage - no one is going to ask you to pony up 5k tomorrow or the next day.

In my own case i have about 10 years left to pay on the mortgage so lets take 5k as the overall cost, that's €41 a month on the repayments, or a few extra payments at the end.

It's a pain in the arse but it's hardly life changing.

But why should you have to ? Why is it my responsibility to pay their rent .. even over the lifetime of my mortgage. For all anyone knows they could be in a far better financial situation than I am.
Im not suggesting that I shouldn't help out or try and make things easier on them and Id be fully open to having conversations about reductions and deferred payments. But there has to be some expectation the tenant will try and pay it back, even if they only tried to cover the additional interest. The idea that I just have to pay a strangers rent for three months just doesn't sit right with me. .

sbsquarepants

shreko wrote: »

But why should you have to ? Why is it my responsibility to pay their rent .. even over the lifetime of my mortgage. For all anyone knows they could be in a far better financial situation than I am.
Im not suggesting that I shouldn't help out or try and make things easier on them and Id be fully open to having conversations about reductions and deferred payments. But there has to be some expectation the tenant will try and pay it back, even if they only tried to cover the additional interest. The idea that I just have to pay a strangers rent for three months just doesn't sit right with me. .

I don't think i should "have" to. I certainly don't feel obligated to provide for anyone just because they happen to be renting from me. They are strangers i have a financial agreement with, i haven't adopted them!

But I do think that it is probably what i'm going to end up doing through necessity by the time the dust settles on this crisis, and all things considered it's not as enormous a burden as some are making out.

It's far from ideal, but desperate times and all that.

Fian

Zulu wrote: »

...you weren't in the SAS by any chance?

Zulu I may be doing you a disservice but i can't help but detect a hint of scepticism in your posts. Maybe I am being unfair to you.

I for one believe every word posted by random strangers on boards, particularly when they are very impressive posters with a portfolio of properties and a very impressive generousity of spirit.

ForestFire

Any advice on the below situation would be appreciated...


- Accidental landlord - renting out the one and only house that they own, as they need to move to another location for work. (Rent received is 150% of monthly mortgage)
- Renting accommodation in there new location close to work - (rent paid is more than rent received - €200PM)
- Has not lost Job to date, but the tenants in their home have lost their job and stop paying rent as they have no funds...

So they will lose their rental income fully
Can pause their own mortgage, but this still leaves a large short fall for their own rent.

If tenants (Both in this case, and in general) have savings built up over time for a rainy period, are they expected to use this to cover their rent, while dose who did not save would get if for free?

Antares35

There is a freeze on rent increases for people affected by the virus, and a ban on evictions for 3 months, but no mention of rents being suspended for 3 months the way mortgage payments can be

Samuel T. Cogley

Antares35 wrote: »

There is a freeze on rent increases for people affected by the virus, and a ban on evictions for 3 months, but no mention of rents being suspended for 3 months the way mortgage payments can be

Because rents can't be suspended using the same mechanism, which if kinda the point of the thread.

Dav010

dharma200 wrote: »

No,
Because air b n b will be pretty much finished, air travel will be extortionate, people all over europe too skint to spend a week in dublin or galway, no more big cultural events, mass unemployment and no more false rental economy.

Have a big long think.

I would have thought Airbnb will be more popular if rents fall. I have an Airbnb house, I’m genuinely thanking my lucky stars it isn’t rented.

Air travel will not be extortionate, if anything it will be great value when it returns as the airlines try to get up and running again.

Listening to Newstalk, rent freeze apply only to those who can show their job has been effected, I would presume you have to show you are in receipt on new pandemic payment, it does not apply to everyone.

Out of interest, where are you seeing rents on daft plummeting, I just googled that and got no results.