Dublin - Significant reduction in rents coming?

Phat Cat

More overpriced apartments being fast tracked, €1,900 for a one bedroom & €2,400 for a two bedroom.

https://www.irishtimes.com/business/construction/noel-smyth-gets-go-ahead-for-d%C3%BAn-laoghaire-apartments-despite-objections-1.4552532?mode=amp

Ozark707

Phat Cat wrote: »

More overpriced apartments being fast tracked, €1,900 for a one bedroom & €2,400 for a two bedroom.

https://www.irishtimes.com/business/construction/noel-smyth-gets-go-ahead-for-d%C3%BAn-laoghaire-apartments-despite-objections-1.4552532?mode=amp

2400 in Dun L? Might be pushing it to get that....

Phat Cat

Ozark707 wrote: »

2400 in Dun L? Might be pushing it to get that....

Dún Laoghaire has always been very expensive, hopefully these new builds don't push the prices up because it's already at breaking point IMO

https://www.daft.ie/property-for-rent/dun-laoghaire-dublin?numBeds_to=2

Ozark707

Phat Cat wrote: »

Dún Laoghaire has always been very expensive, hopefully these new builds don't push the prices up because it's already at breaking point IMO

https://www.daft.ie/property-for-rent/dun-laoghaire-dublin?numBeds_to=2

Loads of those places have been at those prices from well before Covid time. They will never be let at those prices unless the council pay that rate. The market is not there for it. So bringing on places even more than will be empty as well. Lets see what REIT come in and take these...

1percent

Ozark707 wrote: »

Loads of those places have been at those prices from well before Covid time. They will never be let at those prices unless the council pay that rate. The market is not there for it. So bringing on places even more than will be empty as well. Lets see what REIT come in and take these...

I live (rent) near by them and have been thinking that that whole complex will end up in social housing. The new phase that is being built has already been bought off plan by a fund.

mrslancaster

JimmyVik wrote: »

If rents are dropping would it not fall out of being an RPZ ?

would anyone have info on how this works exactly? If the RPZ is based on high increases in the previous few years does the area stay as an RPZ even if rents in the area subsequently fall?
Edit: could rents in some places go back up if the area falls out of RPZ?

BingCrosbee

My son is after block booking luxury office accommodation to run her business down from 250 euro daily to 85 euro per office unit.

Claw Hammer

JimmyVik wrote: »

Most people who have moved to the country during covid are living with their parents. I think this welcome might wear out sooner than later


And as someone from a rural area, i can tell you that most people who grow up in a rural area dont want to live in one, especially after they have had a taste of urban life. Maybe when they hit maybe 45 or so they get a hankering for the quiet life again and might consider a move to the home town then. And even then they have to convince the other half to move to a rural area too.

If people are living with their parents it will make no difference to the rental situation in their area of the country.

Edgware

1percent wrote: »

I live (rent) near by them and have been thinking that that whole complex will end up in social housing. The new phase that is being built has already been bought off plan by a fund.

There are so many Build to Let going up at the moment that at some stage I can see the Council taking the entire development long term. Of course that is better than taking 10% of a complex and Whacker moving in with Sharon and their brood beside someone who has paid 400 grand plus

sk8board

Edgware wrote: »

There are so many Build to Let going up at the moment that at some stage I can see the Council taking the entire development long term. Of course that is better than taking 10% of a complex and Whacker moving in with Sharon and their brood beside someone who has paid 400 grand plus

That’s already been trialled and failed in the 1960’s.

Its called Ballymun.

The 10% rule is a half-assed but workable way to have decent social integration.
The premise is simple - if there’s 1 Whacker & Sharon for every 9 Fintan & Tara’s, it’s more likely that Fintan will rub off on Whacker than visa versa

(unless one of the Fintans is rubbing off on Sharon. Then there’s trouble.)

yagan

sk8board wrote: »

That’s already been trialled and failed in the 1960’s.

Its called Ballymun.

The 10% rule is a half-assed but workable way to have decent social integration.
The premise is simple - if there’s 1 Whacker & Sharon for every 9 Fintan & Tara’s, it’s more likely that Fintan will rub off on Whacker than visa versa

(unless one of the Fintans is rubbing off on Sharon. Then there’s trouble.)

Interesting thing about the Ballymun highrises was that the tenants could never buy them out, but those in the houses that were developed at the time could.

With no incentive to take ownership the towers became a dumping ground.

If the units being bought up now to reduce the housing list don't have a buyin option then I can see history repeating itself.

Ozark707

BingCrosbee wrote: »

My son is after block booking luxury office accommodation to run her business down from 250 euro daily to 85 euro per office unit.

And you see this as having a bearing on the rental market in what way? An indication of less demand for offices meaning less people looking to rent in places close to offices?

sk8board

yagan wrote: »

Interesting thing about the Ballymun highrises was that the tenants could never buy them out, but those in the houses that were developed at the time could.

With no incentive to take ownership the towers became a dumping ground.

If the units being bought up now to reduce the housing list don't have a buyin option then I can see history repeating itself.

They relocated all the original tenants from inner city tenements that they wanted to tear down, following a model that was already failing from Birmingham. The towers were the original pre-fabricated housing too. They nearly appeared over night, relatively speaking.

Flinty997

sk8board wrote: »

That’s already been trialled and failed in the 1960’s.

Its called Ballymun.

The 10% rule is a half-assed but workable way to have decent social integration.
The premise is simple - if there’s 1 Whacker & Sharon for every 9 Fintan & Tara’s, it’s more likely that Fintan will rub off on Whacker than visa versa

(unless one of the Fintans is rubbing off on Sharon. Then there’s trouble.)

And if there is one genuine bad egg. Local authority doesn't have to do anything about 9 houses lives made a misery because the council doesn't own them. Win win for the local authority.

That's said you can be unlucky with a owner of a private house aswell.

Yellow_Fern

sk8board wrote: »

That’s already been trialled and failed in the 1960’s.

Its called Ballymun.

The 10% rule is a half-assed but workable way to have decent social integration.
The premise is simple - if there’s 1 Whacker & Sharon for every 9 Fintan & Tara’s, it’s more likely that Fintan will rub off on Whacker than visa versa

(unless one of the Fintans is rubbing off on Sharon. Then there’s trouble.)

The premise is simple but the support isnt. There is surprisingly little evidence that integrated housing works as designed. Possible as a lot of people these don't have any relationships with their neighbours anymore.

Claw Hammer

Yellow_Fern wrote: »

The premise is simple but the support isnt. There is surprisingly little evidence that integrated housing works as designed. Possible as a lot of people these don't have any relationships with their neighbours anymore.

Marino was an integrated scheme from the start and nearly 100 years later is still a highly desired area.

C14N

Phat Cat wrote: »

Dún Laoghaire has always been very expensive, hopefully these new builds don't push the prices up because it's already at breaking point IMO

https://www.daft.ie/property-for-rent/dun-laoghaire-dublin?numBeds_to=2

New builds don't push up prices of surrounding rentals, no matter how much the new build costs. Some BER C2 apartment built in 2006 that's rented out for €1800 doesn't suddenly become more desirable and competitive for renters becuase it's down the road from an A2 apartment built in 2021 that's going for €2500.

Dav010

C14N wrote: »

New builds don't push up prices of surrounding rentals, no matter how much the new build costs. Some BER C2 apartment built in 2006 that's rented out for €1800 doesn't suddenly become more desirable and competitive for renters becuase it's down the road from an A2 apartment built in 2021 that's going for €2500.

It may look as if it’s better value at a higher rental price though.

New builds can set a first time rental price which is not governed by RPZ legislation. Rental increases on other properties must be supported by examples of similar properties in the area renting at the same price, so higher new builds in the area can be used as examples to increase to the limit. Also, the higher first-let rents set a guide for subsequent new rentals in the area.

Phat Cat

C14N wrote: »

New builds don't push up prices of surrounding rentals, no matter how much the new build costs. Some BER C2 apartment built in 2006 that's rented out for €1800 doesn't suddenly become more desirable and competitive for renters becuase it's down the road from an A2 apartment built in 2021 that's going for €2500.

Landlords can use the €2,500 BER A2 as a bench mark price to push their €1800 C2 property upto say a €2,000 and it looks like better value in comparison.

The property in areas like Dún Laogaire are a good example of this. There are hundreds of new builds in that area, with more in the pipeline, and the prices barely budge around there now.

The example of my colleague, that rents in that area, is another example. His rent is going up €200+ per month over the last 18 months on an older BER D/E apartment, mainly because other rents are so high in that area.

Ozark707

Phat Cat wrote: »

The example of my colleague, that rents in that area, is another example. His rent is going up €200+ per month over the last 18 months on an older BER D/E apartment, mainly because other rents are so high in that area.

How is this happening if it is covered by RPZ?

Phat Cat

Ozark707 wrote: »

How is this happening if it is covered by RPZ?

Under RPZ landlords can raise the rent by 4% every year.

Ozark707

Phat Cat wrote: »

Under RPZ landlords can raise the rent by 4% every year.

If it is going up by 200+ it means that he was paying €5k a month???

Phat Cat

Ozark707 wrote: »

If it is going up by 200+ it means that he was paying €5k a month???

What? I said it had gone up by €200 over the space of 18 months, that's two calender years.

I've no idea what he was paying before but has been there 5 or 6 years now and his rent went up to around €1700 last year and this year it's due to go up to around €1800 so he wants out.

From going a quick Google I found this:

Reviewing the rent for an existing tenancy in a Rent Pressure Zone
Where a landlord is reviewing the rent in a Rent Pressure Zone the amount can not be greater than the amount determined by the formula R x (1 + 0.04 x t/m).

PommieBast

Phat Cat wrote: »

Landlords can use the €2,500 BER A2 as a bench mark price to push their €1800 C2 property upto say a €2,000 and it looks like better value in comparison.

It says a lot about the Dublin property market that the on-streaming of newer properties does not cause the existing stock to depreciate. To me that is a sign is dysfunction.

JimmyVik

Claw Hammer wrote: »

If people are living with their parents it will make no difference to the rental situation in their area of the country.

It will when they move out of the parents house.
People cant live with their parents forever.

JimmyVik

PommieBast wrote: »

It says a lot about the Dublin property market that the on-streaming of newer properties does not cause the existing stock to depreciate. To me that is a sign is dysfunction.

But because of the RPZ owners of lower value properties for sure will use the newer property higher rents to push their "rent cap" up. Just another mess that the RPZ and rent controls have made. All pointed out when rent controls came in first but ignored.

The_Conductor

JimmyVik wrote: »

But because of the RPZ owners of lower value properties for sure will use the newer property higher rents to push their "rent cap" up. Just another mess that the RPZ and rent controls have made. All pointed out when rent controls came in first but ignored.

The only thing that is going to push prices down- is an equilibrium being reached in supply and demand- an A2 property being built up the road- is only one component of this- several hundred A2s in defined local areas- are needed if prices are to be depressed.

Supply and demand is the issue- we are incapable of meeting demand in specific areas- come what may- so ye 1960s clapped out property is in demand- because of a lack of viable alternates.

Its not a race to the bottom- when the bottom is set at an abnormally high level.

The other issue is HAP- the government is viewed as a renter of last resort- but HAP levels are set at prices that are defining the market, rather than taking advantage of the market.

It is all so screwed up.

Cal4567

JimmyVik wrote: »

It will when they move out of the parents house.
People cant live with their parents forever.

It doesn't please me to say this, as everyone should be able to leave the family nest and be able to set up on their own, but that is what is now happening. Imagine someone in their early 30s 5/6 years ago having to move back in with their parents. They are still there, but are now pushing 40. On the plus side they may have accumulated good savings for a deposit but that apartment or even the house they had their eye on, a fund has bought it along with the rest of the new development.

I am seeing more and more cases of just such as the above example, renting in Dublin but now looking to buy a property close to where they came from originally.

C14N

Phat Cat wrote: »

Landlords can use the €2,500 BER A2 as a bench mark price to push their €1800 C2 property upto say a €2,000 and it looks like better value in comparison.

The property in areas like Dún Laogaire are a good example of this. There are hundreds of new builds in that area, with more in the pipeline, and the prices barely budge around there now.

The example of my colleague, that rents in that area, is another example. His rent is going up €200+ per month over the last 18 months on an older BER D/E apartment, mainly because other rents are so high in that area.

This doesn't make any sense. If the LL thinks someone is willing to pay €2000, the LL will set it at €2000 (RPZ limits permitting), whether the more expensive property was down the road or not. Adding in new higher-price properties will at best be a bellweather of the increased demand in general (and an indication of the true market value), but it's not a cause of it. Your colleagues rents are going up because the demand is going up. The fact that other rents are up is just a symptom of the same cause.

If anything, it has the exact opposite effect. It soaks up some demand and decreases the competition for getting other apartments in the area. This just may not be seens as clearly in the numbers when the rent is already at a rate significantly less than its market value already, as the rate of increase will be the same no matter what happens, but it at least means that someone looking for the apartment is not competing against everyone else who was willing to pay the €2500 for the better ones.

C14N

PommieBast wrote: »

It says a lot about the Dublin property market that the on-streaming of newer properties does not cause the existing stock to depreciate. To me that is a sign is dysfunction.

It's due to the fact that demand still greatly outstrips supply and many rents are kept far below market rate by the RPZ rules. If a place is being rented out for €1700, but the free market price would actually be, say €2100, then even if competition from new builds around it brings its theoretical equilibrium price down to €2000, the landlord will still be pushing the prices up until it reaches that rate. They'll only stop putting the rents up when they think they're hitting a number that no tenant will be willing to pay.