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Government to cut rent supplement
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Are his companies not effectively NAMA's (ie. the taxpayers) now?Liam Byrne wrote: »That's nothing......Johnny Ronan's company owes us a fortune and we're still paying him rent for government offices in Dublin, FFS!0 -
Do you know how the RS system works? As i said, its based on the amount of humans claiming and not on your needs.I honestly cannot make head nor tail of that.
A Minister as head o the dept in an official capacity. Not just any TD.snubbleste essentially quoted the same thing you did – it leaves us none the wiser. But I must say, I find it mildly amusing that a Fianna Fáil TD’s vague figures on something property-related are being accepted without question.
Multiple viewings at the same time with said claimants having RS forms in their hands.How could you possibly know that?
RS sets an artificial floor on rents.Countrywide? Why?0 -
Paying him or his company?Liam Byrne wrote: »That's nothing......Johnny Ronan's company owes us a fortune and we're still paying him rent for government offices in Dublin, FFS!0 -
You keep repeating this and I have no idea why it matters?Do you know how the RS system works? As i said, its based on the amount of humans claiming and not on your needs.
So what? You really want me trawl through the archives and find examples of inaccurate statements made by ministers? Because that’s going to be a tremendously long post.A Minister as head o the dept in an official capacity.
I think pretty much everyone is aware of that, but that doesn’t explain why “rents will come down to the base level as set out in the RS rates”. Some rents might, but I find it very hard to believe that all (or even most) rents will take a tumble, especially considering that rents in some places, such as Cork and Dublin City, are rising.RS sets an artificial floor on rents.0 -
You keep repeating this and I have no idea why it matters?
Because thats how the system works.
The Minister quoted figures from his dept. If you really have a problem with it, contact the dept themselves.So what? You really want me trawl through the archives and find examples of inaccurate statements made by ministers? Because that’s going to be a tremendously long post.I think pretty much everyone is aware of that, but that doesn’t explain why “rents will come down to the base level as set out in the RS rates”. Some rents might, but I find it very hard to believe that all (or even most) rents will take a tumble, especially considering that rents in some places, such as Cork and Dublin City, are rising.
No they are not. A subsection of each city have seen fluctuations of a tiny rise in rents for a certain period of time while other subsections have seen falls. The artificial floor is been gradually removed in 2012, hence it will help rents fall. Unless you see a severe shortage of accommodation to support your theory that rents will rise from now on?!0 -
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Great. What's it got to do with your 50% figure?Because thats how the system works.
I didn't say rents will rise from now on – I just don’t think we’ll see the substantial fall in asking prices that you’re predicting. The stock of properties available to rent has fallen significantly, especially in Dublin.No they are not. A subsection of each city have seen fluctuations of a tiny rise in rents for a certain period of time while other subsections have seen falls. The artificial floor is been gradually removed in 2012, hence it will help rents fall. Unless you see a severe shortage of accommodation to support your theory that rents will rise from now on?!0 -
Great. What's it got to do with your 50% figure?
Its not my figure, its a figure publicised by the Dept of Social Protection.I didn't say rents will rise from now on – I just don’t think we’ll see the substantial fall in asking prices that you’re predicting.
We'll wait and see then. This will help.http://www.irishtimes.com/newspaper/finance/2011/0910/1224303849797.htmlHE NATIONAL Asset Management Agency plans to seek tenants for some of its 8,000 apartments with a view to selling them as blocks to investors to help shift properties stuck on its books.
Brendan McDonagh, chief executive of Nama, said that most of the apartments were in Dublin.0 -
Does anyone know when tenants will start receiving the informational letters?0
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Does anyone know when tenants will start receiving the informational letters?
They were sent out on Monday according to the news. I got one anyways. The post might take a bit longer getting yours to Berlin.
The letter says nothing anyways other than the new maximum rent you can pay and that you need to provide them with a copy of your lease.0 -
Interesting. I am prepared to meet my tenants half way somewhere (I already charge at or below the going rate for my area) but I am not really prepared to drop the rent to €755 and I'm sure landlords paying €1200+ a month on a mortgage certainly won't be rushing to drop and will seek replacement (non RS) tenants. I think the rule that the tenant may not rent a home where the rent costs more than the maximum supplement is a bit crazy. If the tenant wants to stay in a place and make up the shortfall themselves, they should really be allowed to.Pin_Cushion wrote: »The letter says nothing anyways other than the new maximum rent you can pay and that you need to provide them with a copy of your lease.
I reckon we will see RS tenants being forced into poorer housing (bed sits etc.) tbh. Rents in D15 aren't ready to fall to €755 for a house IMO. Rents have been holding pretty steady for the last year or so. The going rate is more like €1000 and that's already more than the RS maximum.
(all this is valid for Dublin only-I don't know enough about elsewhere to hold an opinion but I suspect non urban areas will see more empty properties as people try to find work in the cities)0 -
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This is completely wrong. If a tenant is in receipt of rent allowance then they are unemployed and in receipt of unemployment benefit. If they can afford to make up the difference then it's clear that the benefit is too high and should be cut. This is taxpayers money and should not be used to subsidise the landlords mortgage. The rent allowance has been cut in line with current asking rents. The tenant contribution has been raised in line with the percentage you should pay out of your income to meet your housing needs. If a landlord cannot pay his mortgage out of his rental income then he is bankruptInteresting. I am prepared to meet my tenants half way somewhere (I already charge at or below the going rate for my area) but I am not really prepared to drop the rent to €755 and I'm sure landlords paying €1200+ a month on a mortgage certainly won't be rushing to drop and will seek replacement (non RS) tenants. I think the rule that the tenant may not rent a home where the rent costs more than the maximum supplement is a bit crazy. If the tenant wants to stay in a place and make up the shortfall themselves, they should really be allowed to
. Rents should not be based on mortgage repayments. Tenants should not be dipping into their other benefits to subsidise landlords which in turn is being used to bail out the banks - again.0 -
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Fair point.This is completely wrong. If a tenant is in receipt of rent allowance then they are unemployed and in receipt of unemployment benefit. If they can afford to make up the difference then it's clear that the benefit is too high and should be cut.
Also perfectly fair point.This is taxpayers money and should not be used to subsidise the landlords mortgage.
This appears incorrect to me for my area (D15). Current asking prices for a 2 bed on Daft start at €780 (only one property, the rest start at €800) but 2 bed properties are not widespread in D15 at least-it's mostly 3 bed semi-d stock (which seems to ask for €1000 on average). So, a family with one kid on RS will almost certainly no longer be able to afford a 3 bed semi in D15. They may (if lucky) get a terraced ex corpo 3 bed, but there are limited stocks of these too, so demand will presumably push them up and none cost as little as €755 at present in any case.The rent allowance has been cut in line with current asking rents.
So, I think my main point stands: RS tenants are going to face some upheaval in certain areas and will have to seek out 2 bed accomodation where it's going (if it's at an affordable price). I'm not saying it's right or wrong, just making some obervations based on what I am prepared to do. I have dropped the rent previously due to RS cuts and my tenants having to pay more towards the rent themselves, but am I prepared to drop it to €755 when the going rate is at or around €1000? Not really. I think it's a step too far for me (just shy of 3k loss a year) and I may have to take my chances and give my RS tenants notice. The demand is still there in D15 at least from non-RS tenants as employment is still to be had there, thank God.
Never said any of this-not sure if you're attributing it to me or if this is an aside. I don't agree with taxpayers' money being used to subsidise anyone. I don't have a large mortgage as I bought in the 90's to live there. I am simply not prepared to lose that much money a year, even though my tenants are decent and it's a risk to lose them. I am currently charging app. 1.2k less per anum than market rate.The tenant contribution has been raised in line with the percentage you should pay out of your income to meet your housing needs. If a landlord cannot pay his mortgage out of his rental income then he is bankrupt
. Rents should not be based on mortgage repayments. Tenants should not be dipping into their other benefits to subsidise landlords which in turn is being used to bail out the banks - again.
It costs me 500 to insure the place for a year, another 100 to have the gas appliances checked/serviced/signed off, another 300 in property taxes, 20 on average PRTB (must be renewed every 4 years regardless of tenant change), mortgage interest was 1000 last year (though this declines year on year), redecorating costs every few years, incidental maintenance, then I have to pay full 20% tax on any profit (no reliefs as I'm non-resident and can't even offset the property taxes against tax due!).
I'm not whining here: just showing that for the hassle of being a (residential) landlord it's starting to make me question whether or not I want to continue. I may opt to sell and just buy a property in Germany. I am sure other landlords will be questioning the viability of it too.0 -
This appears incorrect to me for my area (D15). Current asking prices for a 2 bed on Daft start at €780 (only one property, the rest start at €800) but 2 bed properties are not widespread in D15 at least-it's mostly 3 bed semi-d stock (which seems to ask for €1000 on average)...
Right now there are 112 2beds asking at 1100 and under in D15. I chose 1100 as a top figure as you had said 1000 as a ballpark figure to compare even though that was for 3beds. The market rate will come down for all types as a result of the drop in RS, give it time.
If you and many landlords like you opt for non-RS tenants as to previously RS tenants, there is not an unlimited supply of non-RS tenants out there. This sub section of landlords will end up competing against each other for tenants hence further helping a drop in rents across the board.0 -
It's re-shuffling the deckchairs on the Titanic imho.
Social housing (which this is) should be handled centrally by the department allowing them to take advantage of their negotiating power, allowing the department to get better value for money: such as saying "well, mr x, we currently pay rent on 5/6 of your properties, we're reducing the rent we're prepared to pay to Y - 15%".
Reduce dole in line with the tenants' current weekly contributions and have the dept pay the landlords directly.0 -
There's not an unlimited supply of properties either, in urban areas at least.If you and many landlords like you opt for non-RS tenants as to previously RS tenants, there is not an unlimited supply of non-RS tenants out there.
Landlords have always competed against each other for tenants?This sub section of landlords will end up competing against each other for tenants hence further helping a drop in rents across the board.
To be honest, the whole idea of a substantial drop in rents across the board sounds like little more than blinkered optimism on your part, especially when we consider the scale of the cuts in rent supplement - €22 million spread across 95,000 tenants isn't all that much (less than €20 per month, on average).0 -
There's not an unlimited supply of properties either, in urban areas at least.
Landlords have always competed against each other for tenants?
They'll be competing in that scenario for a limited supply of non-RS tenants. More landlords competing for a stable supply of non-RS tenants, thats a renters market for non-RS tenants.To be honest, the whole idea of a substantial drop in rents across the board sounds like little more than blinkered optimism on your part, especially when we consider the scale of the cuts in rent supplement - €22 million spread across 95,000 tenants isn't all that much (less than €20 per month, on average).
The biggest drops are in the cities of at least 100 quid for various categories, look at the table again.0 -
Interesting. I am prepared to meet my tenants half way somewhere (I already charge at or below the going rate for my area) but I am not really prepared to drop the rent to €755 and I'm sure landlords paying €1200+ a month on a mortgage certainly won't be rushing to drop and will seek replacement (non RS) tenants. I think the rule that the tenant may not rent a home where the rent costs more than the maximum supplement is a bit crazy. If the tenant wants to stay in a place and make up the shortfall themselves, they should really be allowed to.
I reckon we will see RS tenants being forced into poorer housing (bed sits etc.) tbh. Rents in D15 aren't ready to fall to €755 for a house IMO. Rents have been holding pretty steady for the last year or so. The going rate is more like €1000 and that's already more than the RS maximum.
(all this is valid for Dublin only-I don't know enough about elsewhere to hold an opinion but I suspect non urban areas will see more empty properties as people try to find work in the cities)
Funnily enough the cheapest two-bed property for rent in Blanchardstown on daft.ie is this one:
http://www.daft.ie/searchrental.daft?id=1153944
€780 for a two-bed apartment just off the Main Street of Blanchardstown. The strange thing about it is that it specifies that the landlord will not accept rent supplement. Does he have to set the rent that low to attract private sector tenants? If so, then rent allowance really does put a floor on the market and you will see falls in rents.
The real effect will then be on the property market as the rent falls in Dublin 15 should see a further fall in prices too even though D15 has seen some of the biggest falls already.0 -
To be honest I haven't looked at daft in a year or so (the last time my tenants asked for a reduction). I was quite surprised today to see asking prices as high or possibly a touch higher than they were 12 months ago (in D15).Right now there are 112 2beds asking at 1100 and under in D15. I chose 1100 as a top figure as you had said 1000 as a ballpark figure to compare even though that was for 3beds. The market rate will come down for all types as a result of the drop in RS, give it time.
I think it's quite possible that the cities may buck the national trend a bit as people move to find work in them. I really don't know though.
True, but as I say, it depends how many people decide they have at least a better chance of employment "up in Dublin". If this figure is significant, it could really skew the figures nationally.If you and many landlords like you opt for non-RS tenants as to previously RS tenants, there is not an unlimited supply of non-RS tenants out there. This sub section of landlords will end up competing against each other for tenants hence further helping a drop in rents across the board.
Some (possibly many) may sell up just to get out of it. I'll certainly be thinking that over myself. If this happens, who knows what the knock on effect will actually be-cheaper houses, but no credit for RS tenants most likely. Non-RS folks may be able to buy, if banks will lend etc. etc. Who knows.
I wonder, what if there was absolutely no RS. Where would rents settle then...0 -
True, but as I say, it depends how many people decide they have at least a better chance of employment "up in Dublin". If this figure is significant, it could really skew the figures nationally.
This is a moot point if you're using it in a context whereby RS cuts make the rental sector unavilable to RS recipients in rural areas forcing them to move to Dublin. The cuts in most places outside Dublin are a lot less drastic. No cuts at all in Louth in fact. My monthly rent had to be renegotiated down by around 4% in Westmeath. The landlord thought nothing of it and life goes on as usual.
Adding to that there's a huge surplus of buy-to-let investments "down" here. Landlords are happy to just get something towards the mortgage repayments so it's very much a renter's market.
I do think however that less and less people are willing to buy property now so we'll certainly see the rental market growing over the next few years. So it will probably beome more competitive everywhere eventually. Whether that will result in rents going up or coming down is anyone's guess.0 -
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Just as rent shouldn't be determined by a landlord's mortgage, nor should it be determined by the government setting rates. The market should decide.A Disgrace wrote: »Well then they shouldn't evict them. And also, where will the 95,000 RS tenants go?
I, as a landlord, have a contract with my tenants for a certain rent. In exchange I guarantee to provide them a home. They have their own agreement with government wrt their RS. If they can no longer afford the agreed rent, then (unless we can come to a new, lower, agreed rent) they must leave and seek (presumably) lower quality housing.
I have time for my tenants and have worked with them before as their RS has been reduced and their contribution increased, BUT I can only go so far. If the market rate says the house is worth x per month, then I should be able to achieve that or close enough. It's a business. If the market rates fall to the new RS upper limits (or lower) then that's tough on me and I'll have to offer the property for that rate (or sell up) BUT if the market rate doesn't fall then I should be able to achieve that. I should not have to simply forgo the difference because the state can't house its people.
As for where the RS tenants will go? I presume they'll find their way towards poorer quality, smaller homes, perhaps further from the cities in some cases. I said a long time back: unemployed people cannot and should not expect to be able to live in better located properties than working people. This is just a fact in most countries.0 -
Yes. Yes I do.Do you really have to ask?
I never said anything about 95,000 new tenants. All I asked was why you were assuming the number of tenants to be fixed? For example, if rents to tumble, as you are hoping they will, don't you think more people will rent, as it becomes more attractive to do so?Where do you think 95,000 new non-RS tenants will come from if landlords evict the present 95,000 RS tenants?0 -
As for where the RS tenants will go? I presume they'll find their way towards poorer quality, smaller homes, perhaps further from the cities in some cases. I said a long time back: unemployed people cannot and should not expect to be able to live in better located properties than working people. This is just a fact in most countries.
I'm feeling frazzled by the scale of doomery gloomery stuff attached to this PRS business.
Ireland,over the past 30 years,appears to have detached itself from reality in so many different ways,particularly in how it's people use their powers of rationality.
It's my belief that the notion of a universal entitlement,almost compulsion,to own ones home is responsible for much of the woe we currently endure.
Back in the 1960's the State,through it's local authorities,fulfilled a perfectly realistic role in building,supplying and managing large scale housing stock.
At the beginning of my working life,virtually all of my colleagues were from Council Estates and saw no social stigma to renting from the Corpo.
There was always an amount of movement out of the "Schemes" into the "Purchase" houses,moving from the "Tenants Association" to the "Residents Association".
This movement required a substantial amount of extra effort and dedication on the part of an individual or couple "saving up for a deposit",but it was a choice,which many decided to take,but substantial numbers saw no need for.
Then,at some point in the mid 70's we started smelling ourselves,and our heads began to burst with expectation and entitlement,particularly when Milady Thatcher successfully convinced her adoring populace that owning one's own house was simply de rigeur if one was to be successful in life.
Thus began the era of the Local Authority property sell-off,the notion of the State having a role in housing it's own people was roundly derided,particularly by the new-era of silver tongued property professionals eager to flog LUXURY as an absolute pre-requisite for life itself.
The eventual end of this in Irish terms was the notion that a 75 mile commute twice daily was somehow or other sustainable in a country which had also dutifully followed UK Rail Closure policies laid down by Dr Beeching in his report....
To fund this raw desire for one's own place,and one's own means of transport to it we were encouraged to borrow vast amounts,a process which has now bankrupted us all.
The scale of individual property related debt held by relatively young Irish people is scary indeed.
This debt and its servicing has literally taken over the lives of a generation,divorcing them from the other elements of Social Existance which,luckily,mainland Europeans still manage to enjoy.
What,I wonder,was to be the eventual end-game of this quest to establish an Ownership Culture...was Ireland eventually to be comprised of hundreds of thousands of individually owned bungalows on half an acre or luxury 2 bed townhouses in Tourmakeady.
We're still somewhat chipper that something will come along and allow us to return to normality...but I'm not betting whats left of my weeks wages on that.
I believe that the next generation of young Irish need to re-establish that link with reality,firstly by accepting that some form of property rental directly from the State or it's agents is not the end of the world.....Those Corporation Houses were far better built than the vast majority of the stuff which was flogged to the gullible in the decades following our adoption of Lady Thatchers social policies.
Lets wake up !!Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, and one by one.
Charles Mackay (1812-1889)
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Yes. Yes I do.
I never said anything about 95,000 new tenants. All I asked was why you were assuming the number of tenants to be fixed? For example, if rents to tumble, as you are hoping they will, don't you think more people will rent, as it becomes more attractive to do so?
There was only 13,000 mortgages given out last year. We are already in a position where everyone is renting that doesn't own a house because banks can't actually afford to give out mortgages anymore. New people out of college etc.. are obviously not buying either anymore where as they were at the peak so rental demand is climbing slowly but when you factor in many of those were already renting college accommodation and many are actually just leaving the country, it isn't removing the oversupply very fast I don't think.
The above figure of 13,000 is from the Financial Times who claim that mortgage lending is down 95% from 2008 levels. However, at the peak of the boom, a significant percentage of properties were actually empty, not even rented. Something like 20% was the estimate.
I think many people don't understand the extent of the oversupply of property in Ireland at the peak of the boom. It will take a long time for all this property to work its way out of the system. Just look at daft.ie. There is massive numbers of property up for rent still and I'm looking in a fairly sought after area and the same properties are always up there. The best properties are snapped up fairly fast (as in a month or two) but the others are being taken down and put back up a few weeks later and have been up there for 3-4 months and over in some cases.0 -
Just as rent shouldn't be determined by a landlord's mortgage, nor should it be determined by the government setting rates. The market should decide.
I, as a landlord, have a contract with my tenants for a certain rent. In exchange I guarantee to provide them a home. They have their own agreement with government wrt their RS. If they can no longer afford the agreed rent, then (unless we can come to a new, lower, agreed rent) they must leave and seek (presumably) lower quality housing.
I have time for my tenants and have worked with them before as their RS has been reduced and their contribution increased, BUT I can only go so far. If the market rate says the house is worth x per month, then I should be able to achieve that or close enough. It's a business. If the market rates fall to the new RS upper limits (or lower) then that's tough on me and I'll have to offer the property for that rate (or sell up) BUT if the market rate doesn't fall then I should be able to achieve that. I should not have to simply forgo the difference because the state can't house its people.
As for where the RS tenants will go? I presume they'll find their way towards poorer quality, smaller homes, perhaps further from the cities in some cases. I said a long time back: unemployed people cannot and should not expect to be able to live in better located properties than working people. This is just a fact in most countries.
So just for purposes of example, you probably wouldn't be prepared to drop rent to accomdate RS claimants right? And that's totally your choice, but I worry that it will be also the case for most landlords and thus, this decision by the government is totally wrong
The whole idea was to drive rents down, or so they say, but it seems that rents can't actually be driven any lower. It's all very worrying, not only for tenants, but also for Landlords0 -
Heard Paddy O Gorman on Kenny yesterday stating that and I quote " The government should put manners on landlords" in the context of getting them to reduce rents in line with recent decreases in RS. I"ve always thought that Paddys Dog had more sense than Paddy, now I know it has.0
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Yes. Yes I do.
I never said anything about 95,000 new tenants. All I asked was why you were assuming the number of tenants to be fixed? For example, if rents to tumble, as you are hoping they will, don't you think more people will rent, as it becomes more attractive to do so?
Simples, where will you find 95,000 new tenants? Go on, let us know.
You maybe onto something, lets have cheaper rent like the continentals have. It would be a massive sea change and actually help the economy.A Disgrace wrote:The whole idea was to drive rents down, or so they say, but it seems that rents can't actually be driven any lower. It's all very worrying, not only for tenants, but also for Landlords
Rents will fall. There is this one massive assumption that all landlords took out mortgages in 2006 and you know that is false.
Who is more important, the states finances and worker tenants(like me) or a select few of landlords who have this gravy train of RS? Give your answer to the IMF.0
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