Boomer Wealth

joeguevara

Eric Cartman wrote: »

In dublin 1800 quid is relatively normal for a 2/3 bed , what people have to remember though is youre not just paying to live somewhere , the landlord probably owes 50% of that amount in tax and has to cover Maintainence etc.. if somewheres mortgage cost is 800 its rental income being 1600 is not unusual. Landlords all peg rents here on properties being able to ‘wash their own face’ so to speak paying the full mortgage amount after tax.

The single best thing we could do to lower rents is allow the full mortgage payment to come out pre tax and lower the tax on profits to 12.5% corporate rate , you’d have a glut of landlords enter the market and prices fall.

You are bang on with your premise which very people take into account. Often see threads here from people who think they will make a mint buying a property on mortgage where the rent covers it but don’t know about the income tax and other charges etc.

The part I disagree (unless I misunderstood) is the way of getting more landlords in. These types of landlords provide an unstable environment as they are usually not very liquid and if property price increases are liable to cash in.

In my opinion the way forward is appropriately regulated REITs which would probably be vulture funds to have large blocks of apartments. Funds aren’t taxed like normal landlords so much more financially viable. If there were strict terms of how long they must hold the property, providing long term tenancies at appropriate rents. If the market rent dipped, it could be made up by public monies which would be saving from Rent assistance. The vitriol spewed at vulture funds is usually unwarranted but understandable as mortgage repayments aren’t made so more attractive to repossess and charge full rent to someone else.

Eric Cartman

joeguevara wrote: »

You are bang on with your premise which very people take into account. Often see threads here from people who think they will make a mint buying a property on mortgage where the rent covers it but don’t know about the income tax and other charges etc.

The part I disagree (unless I misunderstood) is the way of getting more landlords in. These types of landlords provide an unstable environment as they are usually not very liquid and if property price increases are liable to cash in.

In my opinion the way forward is appropriately regulated REITs which would probably be vulture funds to have large blocks of apartments. Funds aren’t taxed like normal landlords so much more financially viable. If there were strict terms of how long they must hold the property, providing long term tenancies at appropriate rents. If the market rent dipped, it could be made up by public monies which would be saving from Rent assistance. The vitriol spewed at vulture funds is usually unwarranted but understandable as mortgage repayments aren’t made so more attractive to repossess and charge full rent to someone else.

I don't agree with the term vulture funds, absolutely agree REITs make sense , but small landlords are very necessary and a lot more human when things go wrong for tenants. A group like Kennedy Wilson is acting how a professional REIT acts, built a heap of 2 bed apartments close to the city, absolutely needed 100% success and Im sure it will be profitable,

but we do need small landlords for people renting rurally, in villages, country houses , 1 bed apartments etc... that reits don't consider profitable or viable enough for them. Whats good for the small landlord is good for the REIT too, and we need all the help we can for small landlords who are all just fed up of this.

CageWager

Eric Cartman wrote: »

In dublin 1800 quid is relatively normal for a 2/3 bed , what people have to remember though is youre not just paying to live somewhere , the landlord probably owes 50% of that amount in tax and has to cover Maintainence etc.. if somewheres mortgage cost is 800 its rental income being 1600 is not unusual. Landlords all peg rents here on properties being able to ‘wash their own face’ so to speak paying the full mortgage amount after tax.

The single best thing we could do to lower rents is allow the full mortgage payment to come out pre tax and lower the tax on profits to 12.5% corporate rate , you’d have a glut of landlords enter the market and prices fall.

Yes, the previous discussion (which I was referencing in the post you quoted) was all about 1 bed apartments in Cork but 2/3 bed apartments in Dublin split between 2/3 people will be all be c. €2000+ per month.

We need massive reform in the rental space to make it more secure for renters and more stable as an investment for landlords in terms of tax and also being able to get rid of non-paying/troublesome tenants without having to spend years in the courts.

Edgware

CageWager wrote: »

Yes, the previous discussion (which I was referencing in the post you quoted) was all about 1 bed apartments in Cork but 2/3 bed apartments in Dublin split between 2/3 people will be all be c. €2000+ per month.

We need massive reform in the rental space to make it more secure for renters and more stable as an investment for landlords in terms of tax and also being able to get rid of non-paying/troublesome tenants without having to spend years in the courts.

If we ease off the tax take on landlords it will entice more property owners in to the rental market. The Law of Supply and Demand should then reduce rents. However will landlords be happy with a lower return?

joeguevara

joeguevara wrote: »

You are bang on with your premise which very people take into account. Often see threads here from people who think they will make a mint buying a property on mortgage where the rent covers it but don’t know about the income tax and other charges etc.

Well, here's one perspective. The vast majority of houses in my estate are rented out with the owners trying to cover the costs of their mortgages, or pay off the losses they had during/after the recession. What I've found (myself included) is that most people aren't aware of all the costs in renting out a property. Not just the taxes, or rates, but also the maintenance/repair costs since many tenants don't take care of a rental property. (I assumed that most would take reasonable care of a property... nope. Those who do are a minority)

At least half of the houses in my estate were bought as relative short term investments with the intention of resale, so that people could buy something better for themselves. And just as with my situation, the banking crash forced them to hold on to the properties, renting them out, and struggling to break even. Things are starting to turn around, but for myself, and others, we're still working to make up on over a decade of losses.

Generally, you won't find much sympathy online for this kind of situation. Those without houses/mortgages will talk about people being greedy by getting expensive mortgages, or be angered at people who sought to invest/resell a property in order to afford something better. However, what they fail to realise is that if we could make some actual profits, we'd sell off our properties, and people would be able to buy them.. as opposed to us staggering along trying to pay off past debts, while also maintaining an expensive undertaking.

I would never have entered the rental market as a landlord voluntarily. I know that people talk about Landlords in Dublin making a fortune, but i know quite a few people in Dublin who aren't (Landlord mailing lists and forums). Rental values in my area have increased in recent years, but for a long time, I was barely covering the costs from tax/interest, while paying for repairs (or extras) out of my own pocket.

In any case, I would love to sell my property. I'm dying to get rid of it. So too are over 9 other property owners in my estate. And it's a decent estate (in spite of the councils attempts to load us with settled travellers nearby). People talk about there being a lack of housing, but they fail to realise that many landlords, want to sell, but are still managing built up losses from the recession. When you're not making a profit, you get taxed... when you make a profit, you get taxed more.

Lower the taxes on landlords for a while, and you'll likely see a rash of houses being released to the market to be sold. Sure, there's those who entered the market intending to rent their properties, but I know very few who want to continue doing so into the future. It's just not worth it. It's really not. (unless you're rich enough to have a variety of properties, and the accountants to manage them for you, in which case, it can be very profitable.. but that's out of reach for most single property landlords). Once I'm finished with renting out my place, I'll never do it again.

CageWager

Edgware wrote: »

If we ease off the tax take on landlords it will entice more property owners in to the rental market. The Law of Supply and Demand should then reduce rents. However will landlords be happy with a lower return?

Well they’ll never be happy if they benchmark long term returns against the top of a policy-driven bubble. Rents are so high at the moment that even a 20% drop wouldn’t put too much of a dent in our reputation as a high rent city. Most private landlords are holding an asset for the long term in lieu of a pension so as long as there is positive cashflow and they have positive equity they should have no major complaints. We’d all love ROI to be through the roof on assets we own over 30 years but when you invest long term you have to roll with market movements and adjust strategy accordingly.

Eric Cartman

Edgware wrote: »

If we ease off the tax take on landlords it will entice more property owners in to the rental market. The Law of Supply and Demand should then reduce rents. However will landlords be happy with a lower return?

if you allowed them to pay the mortgage before tax and taxed the profits at 12.5% they could slash 40% off the current rent and earn the exact same, even a 30% rent drop would see landlords and tenants incredibly happy.

joeguevara

Eric Cartman wrote: »

I don't agree with the term vulture funds, absolutely agree REITs make sense , but small landlords are very necessary and a lot more human when things go wrong for tenants. A group like Kennedy Wilson is acting how a professional REIT acts, built a heap of 2 bed apartments close to the city, absolutely needed 100% success and Im sure it will be profitable,

but we do need small landlords for people renting rurally, in villages, country houses , 1 bed apartments etc... that reits don't consider profitable or viable enough for them. Whats good for the small landlord is good for the REIT too, and we need all the help we can for small landlords who are all just fed up of this.

Vulture funds was coined by the funds themselves to differentiate themselves from hedge funds. As part of one of my roles I went through the requirements and determined which authorisation was required. In most cases the requirement to be authorised was mainly on the asset raising company to be a MiFID firm, with the fund itself a corporate vehicle with registration. Credit Servicing Regulation came in much later to ensure that consumers with distressed assets were treated the same if directly owned by the bank. Cerberus and Link would be good examples here. Negative press was stirred up to demonise it which exacerbated the situation.

I think in large Urban areas REITs are the way forward. In smaller urban and rural, it should be able to have direct ownership. For example in Clonmel, my hometown, properties can be bought and afforded by people on factory wages or other similar brackets.

I think the proposals so far for Dublin are inappropriate as they don’t tackle long term tenancy in wanted areas and talk about building housing in green sites which will have ridiculous commutes. And education about the protections REITs can offer people instead of them immediately categorising them as the enemy. It was crazy to me the vitriol put forward at supposed directors of a fund at this golf event. Firstly it was unlikely as the said company directors are so well known. But even if true, no benefits would have been there. It takes months if not years to do a credit risk assessment of any purchases. This is done by an expert team and not directors. Also the risk to fitness and probity assessment and possible removal by the Central Bank was too high for an evening. This would not only effect their current position but also every other future one.

But I suppose the agenda of those pushing it fit,

blanch152

Deleted User wrote: »

Well, here's one perspective. The vast majority of houses in my estate are rented out with the owners trying to cover the costs of their mortgages, or pay off the losses they had during/after the recession. What I've found (myself included) is that most people aren't aware of all the costs in renting out a property. Not just the taxes, or rates, but also the maintenance/repair costs since many tenants don't take care of a rental property. (I assumed that most would take reasonable care of a property... nope. Those who do are a minority)

At least half of the houses in my estate were bought as relative short term investments with the intention of resale, so that people could buy something better for themselves. And just as with my situation, the banking crash forced them to hold on to the properties, renting them out, and struggling to break even. Things are starting to turn around, but for myself, and others, we're still working to make up on over a decade of losses.

Generally, you won't find much sympathy online for this kind of situation. Those without houses/mortgages will talk about people being greedy by getting expensive mortgages, or be angered at people who sought to invest/resell a property in order to afford something better. However, what they fail to realise is that if we could make some actual profits, we'd sell off our properties, and people would be able to buy them.. as opposed to us staggering along trying to pay off past debts, while also maintaining an expensive undertaking.

I would never have entered the rental market as a landlord voluntarily. I know that people talk about Landlords in Dublin making a fortune, but i know quite a few people in Dublin who aren't (Landlord mailing lists and forums). Rental values in my area have increased in recent years, but for a long time, I was barely covering the costs from tax/interest, while paying for repairs (or extras) out of my own pocket.

In any case, I would love to sell my property. I'm dying to get rid of it. So too are over 9 other property owners in my estate. And it's a decent estate (in spite of the councils attempts to load us with settled travellers nearby). People talk about there being a lack of housing, but they fail to realise that many landlords, want to sell, but are still managing built up losses from the recession. When you're not making a profit, you get taxed... when you make a profit, you get taxed more.

Lower the taxes on landlords for a while, and you'll likely see a rash of houses being released to the market to be sold. Sure, there's those who entered the market intending to rent their properties, but I know very few who want to continue doing so into the future. It's just not worth it. It's really not. (unless you're rich enough to have a variety of properties, and the accountants to manage them for you, in which case, it can be very profitable.. but that's out of reach for most single property landlords). Once I'm finished with renting out my place, I'll never do it again.

You bought into a Ponzi scheme at the wrong point in time, we can’t expect to have sympathy for you.

The fact is, those in 2006-2008 bought property to live in and grow their family in, have had no issues, they are still living in those houses raising their kids. It is the ones who wanted to make a quick buck off the others following them along who have suffered.

Former Former

blanch152 wrote: »

You bought into a Ponzi scheme at the wrong point in time, we can’t expect to have sympathy for you.

The fact is, those in 2006-2008 bought property to live in and grow their family in, have had no issues, they are still living in those houses raising their kids.

This is about as accurate and well informed as saying all millennials could afford a house if only they didn't spend so much on avocado toast.

beauf

blanch152 wrote: »

...The fact is, those in 2006-2008 bought property to live in and grow their family in, have had no issues, ....

Thats not a fact. Plenty of people with families bought houses and were unable to keep them or kept them with great hardship.

joeguevara

beauf wrote: »

Thats not a fact. Plenty of people with families bought houses and were unable to keep them or kept them with great hardship.

Definitely true if working in any way connected with the financial industry. Interestingly the year after Lehman was when the highest budgets were spent on training, it, development etc as it was allocated and everyone knew that nothing would be forthcoming. In 2008, I had to reduce the rent on my apartment from 1100 to 650 in the space of 6 months I thinks as each tenant had to move out due to job loss (I think I mentioned somewhere else that I did have a tenant for 1 night that was caught with a huge amount of patsy and asked me to give a character reference to the bride well for station bail application.

blanch152

blanch152 wrote: »

You bought into a Ponzi scheme at the wrong point in time, we can’t expect to have sympathy for you.

No, I didn't. I bought into a decent estate with reasonable projected returns. And to be fair, the prices are reaching the projected amounts now... just didn't factor on a property/banking crash, and the decade of low rents/property values.

The fact is, those in 2006-2008 bought property to live in and grow their family in, have had no issues, they are still living in those houses raising their kids. It is the ones who wanted to make a quick buck off the others following them along who have suffered.

Not a fact in sight. Just a skewed opinion.

But you've proven my point about the lack of sympathy, and attitude of many online. Still, sympathy was perhaps the wrong word to use. Appreciation? Understanding? Consideration? hmm..

beauf

Which decade of low rents and property prices.

It's all cyclical.

joeguevara

beauf wrote: »

Which decade of low rents and property prices.

It's all cyclical.

While cyclical it is a false economy seeing as most rental properties are funded by credit so if low rents, mortgage fails, arrears, repossession, no stability, people lose faith in the financial system which leads to more problems. Property needs to be looked at holistically not what’s best for me.

Also banks aren’t evil. A lot of the issues now are due to consumer protections and credit assessment requirements and liquidity requirements which are now being attacked by the parties who demanded it. Another example is people complaining recently about BOI bank charges. As a cost saver sold ATMs in shops that were loss leader but uproar. Atms in shops aren’t required but it doesn’t help when it’s all blame on all sides.

beauf

joeguevara wrote: »

While cyclical it is a false economy seeing as most rental properties are funded by credit so if low rents, mortgage fails, arrears, repossession, no stability, people lose faith in the financial system which leads to more problems. Property needs to be looked at holistically not what’s best for me.

Also banks aren’t evil. A lot of the issues now are due to consumer protections and credit assessment requirements and liquidity requirements which are now being attacked by the parties who demanded it. Another example is people complaining recently about BOI bank charges. As a cost saver sold ATMs in shops that were loss leader but uproar. Atms in shops aren’t required but it doesn’t help when it’s all blame on all sides.

....Tracker Mortgage Scandal...oops...sorry. you didn't need to lose your home. Our bad...

Had to be dragged kicking and screaming to the table for that mess.

The banks also had rules imposed on them because they couldn't be trusted to do it themselves.

Banks seem to only interested in what's good for them. Bit late to take the high moral ground.

joeguevara

beauf wrote: »

....Tracker Mortgage Scandal...oops...sorry. you didn't need to lose your home. Our bad...

Had to be dragged kicking and screaming to the table for that mess.

The banks also had rules imposed on them because they couldn't be trusted to do it themselves.

Banks seem to only interested in what's good for them. Bit late to take the high moral ground.

I think the banks acted abysmally in loads of places. The tracker being the worst. And refusing ombudsman ruling. Having to go to court

Yurt2

Deleted User wrote: »

No, I didn't. I bought into a decent estate with reasonable projected returns. And to be fair, the prices are reaching the projected amounts now... just didn't factor on a property/banking crash, and the decade of low rents/property values.



Not a fact in sight. Just a skewed opinion.

But you've proven my point about the lack of sympathy, and attitude of many online. Still, sympathy was perhaps the wrong word to use. Appreciation? Understanding? Consideration? hmm..

This one really is a head scratcher. Talking about empathy and consideration when a few posts previous telling people to man the f*ck up and lecturing about personal responsibility, all the while talking about returns as if housing is a stock-pick.

Klaz, I'm sorry but I've very little respect for how you've approached this thread and how you've responded to people expressing concern about the Irish housing obscenity.

Yurt!

Yurt! wrote: »

This one really is a head scratcher. Talking about empathy and consideration when a few posts previous telling people to man the f*ck up and lecturing about personal responsibility, all the while talking about returns as if housing is a stock-pick.

Klaz, I'm sorry but I've very little respect for how you've approached this thread and how you've responded to people expressing concern about the Irish housing obscenity.

Yurt, You rarely have much respect for anyone with differing opinions..

As for how I've approached this thread, I've suggested that people do what it takes to earn the money needed for a deposit, acquire a mortgage, and improve their credit rating... as opposed to expecting others to provide for them, or simply complaining about it. I made one comment to "man the **** up" in response to your own post, and yet, you've decided to judge all my posts based on that one comment. So... yeah, your respect isn't such a terrible loss to me.

SusieBlue

[Deleted User] wrote: »

Yurt, You rarely have much respect for anyone with differing opinions..

As for how I've approached this thread, I've suggested that people do what it takes to earn the money needed for a deposit, acquire a mortgage, and improve their credit rating... as opposed to expecting others to provide for them, or simply complaining about it. I made one comment to "man the **** up" in response to your own post, and yet, you've decided to judge all my posts based on that one comment. So... yeah, your respect isn't such a terrible loss to me.

You advised me to go into the market of renovating run down rural properties and selling them at profit in order to make the extra money needed to be able to get a mortgage, and that I need to compromise and suck it up.

You have now admitted that it has taken you the guts of 14 years to see any return on your latest endeavour, yet you still presented your idea to me as a reasonable, safe investment in order to earn money if I would bother only put in the effort, when your own situation is proof that it doesn’t always work, and therefore not an investment a low earner should be making with their life savings.
It’s clearly a huge risk and waiting a decade and a half to have access to secure accommodation is not something I’m aspiring to do.

Also I never once stated I expect the state or anyone else to provide housing to me, and I will never agree that wanting secure rentals for a fair price and fairer access to mortgages is the equivalent of being a sponger.

GreeBo

lainey_d_123 wrote: »

eventually get a well-paid job

Why do you expect to be able to compete with people who had a well paid job from the start?

lainey_d_123

GreeBo wrote: »

Why do you expect to be able to compete with people who had a well paid job from the start?

'Compete with' - shows the sick attitude towards housing, doesn't it?

It shouldn't be a competition for anyone to put a secure roof over their head, whether they're an investment banker or working in Centra.

The entire point is that buying (or securely renting - a concept which doesn't exist in the UK or Ireland) a modest home should not be beyond the reach of the average person. You shouldn't need to be a high earner to have a modest home.

How do you STILL not get it?

GreeBo

Edgware wrote: »

If we ease off the tax take on landlords it will entice more property owners in to the rental market. The Law of Supply and Demand should then reduce rents. However will landlords be happy with a lower return?

You might increase the supply of landlords, but where are all the properties coming from?
The law of supply and demand means that property price will increase.

lainey_d_123

SusieBlue wrote: »

You advised me to go into the market of renovating run down rural properties and selling them at profit in order to make the extra money needed to be able to get a mortgage, and that I need to compromise and suck it up.

You have now admitted that it has taken you the guts of 14 years to see any return on your latest endeavour, yet you still presented your idea to me as a reasonable, safe investment in order to earn money if I would bother only put in the effort, when your own situation is proof that it doesn’t always work, and therefore not an investment a low earner should be making with their life savings.
It’s clearly a huge risk and waiting a decade and a half to have access to secure accommodation is not something I’m aspiring to do.

Also I never once stated I expect the state or anyone else to provide housing to me, and I will never agree that wanting secure rentals for a fair price and fairer access to mortgages is the equivalent of being a sponger.

It was a ludicrous, laughable suggestion.

Taking on renovation projects in the countryside is something you do when you have the spare money to invest, knowing it may take years to see a return on your investment, and that you may actually end up losing.

To suggest it as a viable way for a person to obtain a secure home is bordering on actual insanity.

GreeBo

lainey_d_123 wrote: »

'Compete with' - shows the sick attitude towards housing, doesn't it?

Welcome to the real world.:rolleyes:

It shouldn't be a competition for anyone to put a secure roof over their head, whether they're an investment banker or working in Centra.

Of course it is? How could it possibly not be outside of a communist country?
Who is building these nice properties in nice areas that you can afford to buy but yet other people with more money than you are not buying?

Explain to me slowly, why people with more money that you would rather spend more than you to end up in a similar property to you?
Newsflash, they wont. And that is what will drive up the price of those nice properties in nice places that you think should be reserved for you.

The entire point is that buying (or securely renting - a concept which doesn't exist in the UK or Ireland) a modest home should not be beyond the reach of the average person. You shouldn't need to be a high earner to have a modest home.

Clearly its not a *modest* home if only high earners can afford it?

How do you STILL not get it?

RIGHT back at you.

Wanderer78

GreeBo wrote: »

You might increase the supply of landlords, but where are all the properties coming from?
The law of supply and demand means that property price will increase.

seriously lads, we have to stop with this bollcoks! these are not laws, similar to the laws of science, there is no market equilibrium! one of the main reasons for the rising price of housing, is due to the increasing availability of credit, i.e. more credit = higher prices, its got literally fcuk all to do with supply

GreeBo

SusieBlue wrote: »

I will never agree that wanting secure rentals for a fair price and fairer access to mortgages is the equivalent of being a sponger.

Define "fair" for me?

and as I asked your fellow poster, explain to me (again slowly) how any market maintains the supply of cheap fairly priced properties in nice areas?

SusieBlue

GreeBo wrote: »

Define "fair" for me?

and as I asked your fellow poster, explain to me (again slowly) how any market maintains the supply of cheap fairly priced properties in nice areas?

Other countries do long term and even life time leases with the tenants rent being proportional to their income. It negates the need for a mortgage too.
That’s my idea of fair.
How do other countries (with much denser populations too) manage to have such systems in place but the best we can come up with is having low earners spend over half their income on rentals with no security. Surely we can do better than that.
Surely we should want to do better than that?

Wanderer78

SusieBlue wrote: »

Other countries do long term and even life time leases with the tenants rent being proportional to their income.
That’s my idea of fair.
How do other countries (with much denser populations too) manage to have such systems in place but the best we can come up with is having low earners spend over half their income on rentals with no security. Surely we can do better than that.
Surely we should want to do better than that?

financing some of our accommodation needs, can and should be done by ourselves

lainey_d_123

GreeBo wrote: »

Welcome to the real world.:rolleyes:


Of course it is? How could it possibly not be outside of a communist country?
Who is building these nice properties in nice areas that you can afford to buy but yet other people with more money than you are not buying?

Who is talking about nice properties in nice areas??

I linked to a one-bed in Dolphin's Barn which was an absolute hole of a place and needed extensive work done to it, on sale for 185K.

You really believe that someone on average Dublin wages should still struggle to afford a kip like that after saving for years?

Explain to me slowly, why people with more money that you would rather spend more than you to end up in a similar property to you?
Newsflash, they wont. And that is what will drive up the price of those nice properties in nice places that you think should be reserved for you.


Clearly its not a *modest* home if only high earners can afford it?


RIGHT back at you.

You're one of the slowest posters I've ever encountered on Boards.ie, and there's a good bit of competition.

Nobody is talking about 'nice' properties in 'nice' places except you.

How much more 'modest' can you get than a one-bed flat or a studio, in the worst parts of Dublin?

You think it's normal that average and below average earners (so half the city population) should not even be able to afford that?