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How do we actually fix the rental market?
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Laws are very tenant sided.Then why are they leaving ?
As aboveIf not the regs what reasons ?
Inability to have the mortgage paid. It's a business. But people seem to want the landlords input money on a monthly basis to pay said mortgage.Inability to make a monthly profit ?
What?Inability for the property to wash its face ? I
Laws are either changed to benefit the tenant, or not at all.Change the laws
Which EU model? Some German cities are worse than Ireland. Also, imagine the shock of Irish people getting a blank flat, and having to furnish it themselves?Run it the same as European models
Just on landlords.But that puts more obligations on landlords and tenants
If the landlord doesn't follow the regs, they get brought to court, and made to pay up.And landlords already give out about the regs and some don’t follow the ones that are there
If the tenant doesn't follow regs, it may take 2 years to have them evicted, and any rent not paid is lost, as well as any damage to the property.0 -
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Laws are very tenant sided.
As above
Inability to have the mortgage paid. It's a business. But people seem to want the landlords input money on a monthly basis to pay said mortgage.
What?
Laws are either changed to benefit the tenant, or not at all.
Which EU model? Some German cities are worse than Ireland. Also, imagine the shock of Irish people getting a blank flat, and having to furnish it themselves?
Just on landlords.
If the landlord doesn't follow the regs, they get brought to court, and made to pay up.
If the tenant doesn't follow regs, it may take 2 years to have them evicted, and any rent not paid is lost, as well as any damage to the property.
If you honestly think that the rental income should cover the mortgage the tax and other associated costs that you are living in cloud cuckoo land
The profit is in 20 years time when you have an appreciating asset that you only paid 30-50% of the cost price
A tenant should not be expected to cover all your costs leaving you with a cost free asset at the end
It’s not how the rental market should work and it’s thinking like that that has the market the way it is0 -
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There should be very strict and very limited reasons for both a tenant and a landlord ending a tenancy...
There are.
But it doesn't matter, if it's not enforced, or enforcement is not resourced enough to makes any real difference to those who abuse it. Be they tenant or landlord.
Reality none of these changes over the past couple of decades made any real difference to affordability or supply. In some cases they made things worse. The only thing that made a significant impact was Covid. Even there if you had enough financial resources regardless if you were tenant or landlord you wouldn't be much effected as you have reserves to weather the crisis.
I expect after Covid we will see disparity in wealth widen considerably.0 -
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If the house is not generating income after paying off the yearly mortgage, nothing gets fixed as the LL has to input the remainder to the bank.If you honestly think that the rental income should cover the mortgage the tax and other associated costs that you are living in cloud cuckoo land
For houses bought before the 1990's, maybe. Anything bought since then; nope.The profit is in 20 years time when you have an appreciating asset that you only paid 30-50% of the cost price
A tenant pays for a service.A tenant should not be expected to cover all your costs leaving you with a cost free asset at the end
That is correct. The rental market should work by a corporation owning multiple properties and/or an apartment block, and rent it out to tenants. Should the tenant fail to pay rent, they should be evicted regardless of their circumstances. And if the tenant doesn't leave, they should be forceably evicted by sheriff within 30 days of eviction date if they fail to leave.It’s not how the rental market should work and it’s thinking like that that has the market the way it is
But that is not the case in Ireland.0 -
If you honestly think that the rental income should cover the mortgage the tax and other associated costs that you are living in cloud cuckoo land
The profit is in 20 years time when you have an appreciating asset that you only paid 30-50% of the cost price
A tenant should not be expected to cover all your costs leaving you with a cost free asset at the end
It’s not how the rental market should work and it’s thinking like that that has the market the way it is
That might be the way affordable housing should be done. But private housing and luxury housing?
In the past I know guys who worked intensively to put down over 50% or more on a property and cleared the mortgage a few years after that. While doing that they leverage against that property and repeat the process. So in relatively short time they have a portfolio that's mostly mortgage free. They clear the mortgage as fast as they can, to spend as little as possible on the interest. They certainly aren't paying 30yrs of
interest to turn a profit.0 -
If you honestly think that the rental income should cover the mortgage the tax and other associated costs that you are living in cloud cuckoo land
The profit is in 20 years time when you have an appreciating asset that you only paid 30-50% of the cost price
A tenant should not be expected to cover all your costs leaving you with a cost free asset at the end
It’s not how the rental market should work and it’s thinking like that that has the market the way it is
Correct.
The rent should not cover the cost of ownership.
The rent should cover the cost of occupation.
If the landlord has to pay cash towards the mortgage capital repayment, that is a form of saving, and is to be expected.0 -
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Nothing's wrong with it. If it happens, it's great. You just shouldn't expect it to happen because the market forces that underpin the capitalist system indicate that, normally, it won't happen. So if you embark on the project expecting the rental income to cover the cost of acquiring the property plus the cost of maintaining it during the letting you are likely to be disappointed.Even a mortgage free property is not cost free to keep and maintain.
If the market price covers all the costs of say a million euro apartment. Whats wrong with that?0 -
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It's not perfect because there are high numbers on waiting lists and shortages of new builds, especially in the major cities, but from a tenants perspective I found renting in Sweden far more affordable and the quality of apartments on offer far and above what you find in this country. Everything from build quality (highest in the world) to utilities for each renter: lock up storage rooms, communal laundry facilities, bicycle storage, children play areas... all as standard.
So have local authorities set up limited companies to build and supply apartments with long term rentals, built for family living and rent controlled. Set up Tenant Rent Unions that will negotiate rents on behalf of their members with the housing companies and set rents yearly.
https://www.sverigesallmannytta.se/in-english/public-housing-in-sweden/
Of course we'd never do this here because this is Ireland where private developers and the market is allowed run riot, but that's my opinion anyway based on my experience.
Ideally I'd have the state build and supply far more mixed development quality housing, and expand co-housing options also.0 -
Peregrinus wrote: »Nothing's wrong with it. If it happens, it's great. You just shouldn't expect it to happen because the market forces that underpin the capitalist system indicate that, normally, it won't happen. So if you embark on the project expecting the rental income to cover the cost of acquiring the property plus the cost of maintaining it during the letting you are likely to be disappointed.
Seems like people are complaining because it IS happening.
A landlord will only get what people will pay. If they ask for 8k a month they won't get it. The landlord will only get what the market will pay. That price is not based on costs. It's based on supply and demand.
I don't know why people think the private market should be supplying at cost (non profit) housing.
If you want to drop the cost of housing supply has to increase or demand fall.0 -
Ireland is a quirky small market that is very vulnerable to outside forces. We're in this little bowl and fighting amongst ourselves to try solve a problem that needs outside help. We're conditioned to think the market is what it is but that's completely unrealistic.
If we keep depending on individual landlords to get loans to fund this then we will always be left with landlords who are dependant on the income. They will never invest in properties. People use morality here when they complain about landlords, but it's bad legislation and policy. We depend on private landlords, they have bills to pay.
The state needs to be more involved, both in regulation as mentioned above and provision. This could even be public private partnership for those who wish to invest. Risk would be lower, so return would be lower but there would be an appetite for long term investment.
Unlike public housing this should be rental housing with rental contacts.
I would even consider after a number of years it should be built-in to the plans to sell the property.0 -
If it's happening extensively, that indicates market inefficiency, because it shouldn't be. It should obviously cost less to rent a property than it does to buy it outright and, if it normally or frequently costs the same or more, then rents are too high which means the market isn't working properly. So you need to look to imperfections in the market to see why this is happening.Seems like people are complaining because it IS happening.
As you point out, it's a matter of supply and demand. If there's a scarcity of housing then both purchase costs and rental costs will go up, but if rental costs are going up more than purchase costs, and especially if they are sustained at a level above the cost of purchasing, that's not accounted for by just the scarcity of housing, and you need to look for other factors to account for it.
It could be, as some have suggested, tenant-friendly legislation driving landlords out of the market. But others have pointed to countries where the legislation is more tenant-friendly, and yet the rental market seems to work better there. Maybe the Irish legislation needs to be tenant-friendly, but in different ways.
But the problem could be on the supply side; we have a lot of small landlords - people with just one or two properties to let - who may not have the liquid capital needed to manage the risks and volatility of the business they are in, and so seek to pass those risks to the tenant. (If there's a high proportion of landlords who think that net rent covering mortgage is normal and is to be expected, that's a strong indication that landlords have an unrealistic appreciation of the business they're in.)
Possibly one of the things we need is a regulatory climate that encourages landlording on a commercial scale, and which therefore facilitates more professional landlording? Just a thought.
And, yeah, an improved supply of public housing is definitely an issue. It's notoriously slow and difficult to evict a non-paying tenant in Ireland and part of the reason is (a) a high proportion of non-paying tenants are not paying because they don't have the money, and (b) if evicted and therefore homeless it becomes a public responsibility to house them and therefore (c) the state has an incentive to defer, delay or impede their eviction or, at the very least, not to adopt measures that would make it easier. If we had a better-resourced and more resilient public housing system that problem would be greatly alleviated.0 -
Now that vaccination plans are being rolled out, building completions are way behind and commencements have dropped significantly this year, property prices and rents are expected to increase again in 2021.
https://www.google.ie/amp/s/amp.rte.ie/amp/1183015/
https://www.google.ie/amp/s/www.irishtimes.com/business/personal-finance/fiona-reddan-who-d-be-a-first-time-buyer-in-2021-1.4431161?mode=amp
Institutional landlords continue to buy blocks, reducing stock for sale. This is what people called for, professional landlords, so at least some are happy.0 -
If the house is not generating income after paying off the yearly mortgage, nothing gets fixed as the LL has to input the remainder to the bank.
For houses bought before the 1990's, maybe. Anything bought since then; nope.
A tenant pays for a service.
That is correct. The rental market should work by a corporation owning multiple properties and/or an apartment block, and rent it out to tenants. Should the tenant fail to pay rent, they should be evicted regardless of their circumstances. And if the tenant doesn't leave, they should be forceably evicted by sheriff within 30 days of eviction date if they fail to leave.
But that is not the case in Ireland.
If that is the attitude of the landlord he is in the wrong game
He would be better off with a 3 story 8 bedroom house with 6 bunkbeds in every room0 -
Peregrinus wrote: »If it's happening extensively, that indicates market inefficiency, because it shouldn't be. It should obviously cost less to rent a property than it does to buy it outright and, if it normally or frequently costs the same or more, then rents are too high which means the market isn't working properly. So you need to look to imperfections in the market to see why this is happening...
Why. It's like getting taxi everywhere instead of buying a cheap car. There again the price is set by supply and demand. If you are renting in the middle of capital city or out in the middle of nowhere. Those things change.
It's not constant either. I remember when rent was cheaper than a mortgage and it's flipped a couple of times in my memory.0 -
Peregrinus wrote: »If it's happening extensively, that indicates market inefficiency, because it shouldn't be. It should obviously cost less to rent a property than it does to buy it outright and, if it normally or frequently costs the same or more, then rents are too high which means the market isn't working properly. So you need to look to imperfections in the market to see why this is happening.
As you point out, it's a matter of supply and demand. If there's a scarcity of housing then both purchase costs and rental costs will go up, but if rental costs are going up more than purchase costs, and especially if they are sustained at a level above the cost of purchasing, that's not accounted for by just the scarcity of housing, and you need to look for other factors to account for it.
It could be, as some have suggested, tenant-friendly legislation driving landlords out of the market. But others have pointed to countries where the legislation is more tenant-friendly, and yet the rental market seems to work better there. Maybe the Irish legislation needs to be tenant-friendly, but in different ways.
But the problem could be on the supply side; we have a lot of small landlords - people with just one or two properties to let - who may not have the liquid capital needed to manage the risks and volatility of the business they are in, and so seek to pass those risks to the tenant. (If there's a high proportion of landlords who think that net rent covering mortgage is normal and is to be expected, that's a strong indication that landlords have an unrealistic appreciation of the business they're in.)
Possibly one of the things we need is a regulatory climate that encourages landlording on a commercial scale, and which therefore facilitates more professional landlording? Just a thought.
And, yeah, an improved supply of public housing is definitely an issue. It's notoriously slow and difficult to evict a non-paying tenant in Ireland and part of the reason is (a) a high proportion of non-paying tenants are not paying because they don't have the money, and (b) if evicted and therefore homeless it becomes a public responsibility to house them and therefore (c) the state has an incentive to defer, delay or impede their eviction or, at the very least, not to adopt measures that would make it easier. If we had a better-resourced and more resilient public housing system that problem would be greatly alleviated.
Agree to all of that and especially the bit in bold
Too many landlords get into the market to make a quick profit expecting all their capital and running costs to be paid
One poster even compared it to the rental car market
Its landlords not knowing what they are getting into plus bad legislation and poor enforcement that are the main issues0 -
Peregrinus wrote: ».... ..
It could be, as some have suggested, tenant-friendly legislation driving landlords out of the market. But others have pointed to countries where the legislation is more tenant-friendly, and yet the rental market seems to work better there. Maybe the Irish legislation needs to be tenant-friendly, but in different ways. ..
Many of those places have more protection for landlords also and things like 3 month deposits, and tenants are pursued for costs and damages unlike here.
Also many of those markets have supply issues. A lot stopped building public housing all around the same time, and out sourced it to the private market as Ireland did. If you are looking for common policy change, that was it.0 -
Now that vaccination plans are being rolled out, building completions are way behind and commencements have dropped significantly this year, property prices and rents are expected to increase again in 2021.
https://www.google.ie/amp/s/amp.rte.ie/amp/1183015/
https://www.google.ie/amp/s/www.irishtimes.com/business/personal-finance/fiona-reddan-who-d-be-a-first-time-buyer-in-2021-1.4431161%3fmode=amp
Institutional landlords continue to buy blocks, reducing stock for sale. This is what people called for, professional landlords, so at least some are happy.
And yet the Banking payments federation disagree with you
19k completions opposed to a planned 23 completions in the middle of a pandemic is good enough in my opinion
https://www.rte.ie/news/business/2020/1208/1183015-housing-supply-wont-meet-demand-for-at-least-3-years/
The pandemic may have had an effect on new starts
If however as evidence seems to suggest there is a large cohort of deposit rich mortgage approved buyers out there then builders will build to satisfy the market
Remember commercial and office builds are expected to be minimal this year .freeing up labour0 -
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Agree to all of that and especially the bit in bold
Too many landlords get into the market to make a quick profit expecting all their capital and running costs to be paid
One poster even compared it to the rental car market
Its landlords not knowing what they are getting into plus bad legislation and poor enforcement that are the main issues
Am I the only one that thinks what you are advocating would make the rental sector immeasurably worse? I know you have claimed that you used to be a landlord, but I’m not convinced.
Institutional/commercial/professional landlords, whatever you want to call them, don’t tend to buy properties outside the biggest urban areas. If you advocate that small/amateur landlords get out if they are not happy with the regs, or unable to afford to pay a mortgage for a year whilst trying to remove a non paying tenant, instead of increasing stock/lower rents, you get reduced stock and thus higher rents. This is your way of fixing the rental market, reduce the number of landlords?0 -
Agree to all of that and especially the bit in bold
Too many landlords get into the market to make a quick profit expecting all their capital and running costs to be paid
One poster even compared it to the rental car market
Its landlords not knowing what they are getting into plus bad legislation and poor enforcement that are the main issues
How is 30yrs a quick profit.
Landlords don't set the market price. They don't set the rules or enforcement them. Landlords might be taking advantage of the market conditions but they aren't creating them.
Legislation and enforcement have nothing to do with supply or demand.
Which is why vilification and penalising landlords and all the regulation had almost no effect on the market or supply and demand in decades.0 -
Am I the only one that thinks what you are advocating would make the rental sector immeasurably worse? I know you have claimed that you used to be a landlord, but I’m not convinced.
Institutional/commercial/professional landlords, whatever you want to call them, don’t tend to buy properties outside the biggest urban areas. If you advocate that small/amateur landlords get out if they are not happy with the regs, or unable to afford to pay a mortgage for a year whilst trying to remove a non paying tenant, instead of increasing stock/lower rents, you get reduced stock and thus higher rents. This is your way of fixing the rental market, reduce the number of landlords?
I was a landlord ,but it was not to make a monthly income
It was to be an enhancement to my employment pension when I retired i.e a long term game
Like any pension I was prepared to put money in if needed knowing the end result was a mortgage free property at the end of which I had paid less than half
Unless you have a lot of properties and a lot of equity in those properties then you should not expect to make a living
When a better opportunity presented itself we left the market
Reduce the number of amateur landlords who do not know what they are doing and increase the number of professional landlords0 -
And yet the Banking payments federation disagree with you
19k completions opposed to a planned 23 completions in the middle of a pandemic is good enough in my opinion
https://www.rte.ie/news/business/2020/1208/1183015-housing-supply-wont-meet-demand-for-at-least-3-years/
The pandemic may have had an effect on new starts
If however as evidence seems to suggest there is a large cohort of deposit rich mortgage approved buyers out there then builders will build to satisfy the market
Remember commercial and office builds are expected to be minimal this year .freeing up labour
Not close to meeting demand and how much of it is social and affordable housing.0 -
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I was a landlord ,but it was not to make a monthly income
It was to be an enhancement to my employment pension when I retired i.e a long term game
Like any pension I was prepared to put money in if needed knowing the end result was a mortgage free property at the end of which I had paid less than half
Unless you have a lot of properties and a lot of equity in those properties then you should not expect to make a living
When a better opportunity presented itself we left the market
Reduce the number of amateur landlords who do not know what they are doing and increase the number of professional landlords
So you advocate reducing rental stock to those owned by “professional landlords”? Can you see the obvious issues with this policy and how it could drastically reduce rental stock leading to higher rents?0 -
Peregrinus wrote: »....
But the problem could be on the supply side; we have a lot of small landlords - people with just one or two properties to let - who may not have the liquid capital needed to manage the risks and volatility of the business they are in, and so seek to pass those risks to the tenant. (If there's a high proportion of landlords who think that net rent covering mortgage is normal and is to be expected, that's a strong indication that landlords have an unrealistic appreciation of the business they're in.)
When rents were low you had an even higher % of small landlords and there is no difference in the rent charged between a small or a large landlord. Which means risk isn't factored into rent. It might cause landlord to leave the market. But it doesn't itself directly set the rent.Peregrinus wrote: »Possibly one of the things we need is a regulatory climate that encourages landlording on a commercial scale, and which therefore facilitates more professional landlording? Just a thought.....
Large landlords have the lowest % of social and affordable housing. Small landlords the highest %.
But the market wants what it wants. Time to get popcorn out and see how that plays out long term.0 -
I was a landlord ,but it was not to make a monthly income
It was to be an enhancement to my employment pension when I retired i.e a long term game
Like any pension I was prepared to put money in if needed knowing the end result was a mortgage free property at the end of which I had paid less than half
Unless you have a lot of properties and a lot of equity in those properties then you should not expect to make a living
When a better opportunity presented itself we left the market
Reduce the number of amateur landlords who do not know what they are doing and increase the number of professional landlords
Well that is whats happening. Didn't fix any thing. Probably made it worse as new rentals are not bound by the RPZ so free to set rents higher than market rent. Which is why rents still increased with the introduction of RPZ.
But the market wants what it wants.0 -
Of course its not close to meeting demand and will not for years
I never claimed it did
I have no idea how much of it was social and affordable housing
These things are central to the crisis though.
If you are wealthy, there is no shortage of housing. Which is much of the housing is aimed at big Tech companies and banks, or well heeled students from all around the world.0 -
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Depends on the quality on the new entrants and if they know what they are doing and are prepared to accept and abide by the laws and not bitch about them and only accept the ones that suit
Buying an investment property with a mortgage is a long term game ,it should not be viewed as additional income ,which many landlords do
So how do you attract new ll then?
If rent is far below market rent. How can a new ll invest it while they wait 10years to get it up to the market rate of 2020 let alone what it would be at in 2030. In a normal industry, it’s a free market and the business will charge what the people are willing to pay and this can act as a big disincentive for current and future ll.0
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