Councils now paying full market rates for RAS?

murphaph · 20-01-2015 2:32pm #1

I noticed the Fingal website is a bit more "desperate" than it once was, ie that they seem to be having trouble housing people and are trying harder to source RAS properties (and indeed long term leased properties).

They used to always talk of market rate MINUS 10% because of "guaranteed rent payments". I now see no reference to this and instead the FAQ simply states "Rent levels will be determined by negotiation between the landlord and the Local Authority and will reflect local market rents."

Interesting perhaps for anyone with an RAS property in Fingal, or in any high demand area perhaps.

Gatling · 20-01-2015 2:47pm

That could be handy for many wonder if it's a short term thing ,
If others area's do it I might consider going for a property using the scheme

Jasper79 · 20-01-2015 2:54pm

Sounds interesting I have a property and would be interested in something like this, but still seems very risky.

1)The Council select the tennants, but landlord has to deal with them as the council just act as a broker , could lead to all sorts of problems depending on the tennant.

2)Council pays current market rate, will it increase each year for the 4 year period if the market does .

3) They "May" reimbourse property damage up to the value of one months rent.

These would be the main reasons as a landlord I don't think RAS is worth getting involved in . Especially now when demand is high.

murphaph · 20-01-2015 2:59pm

To be honest I'd only use the RAS scheme if I had in situ rent supplement tenants who qualified (known quantity). I wouldn't give up the nomination rights to my property to the council, but some people may feel the background checks the council perform are sufficient. Maybe they are...I just have no way of verifying that they are.

There is a rent review in year 2 and 4 of a 5 year contract and in years 2,4,6 and 8 of a 10 year RAS contract with Fingal.

murphaph · 20-01-2015 3:06pm

Had a quick look at SDCC's site and they still mention a "discount":

"Rent levels will reflect local market conditions but must show an 8% reduction on current market rents applicable at time of contract signing."

So, obviously a localised phenomenon.

Gatling · 20-01-2015 4:34pm

murphaph wrote: »

I wouldn't give up the nomination rights to my property to the council, but some people may feel the background checks the council perform are sufficient. Maybe they are...I just have no way of verifying that they are.

It's a full garda backround check according to sdcc housing department .
So drugs and anti social behaviour gets refused,
But it can be bypassed usually by the applicant saying say a single mother applies she can come back with no issues but an undeclared partner/ family member who could be major trouble just moves in and vice versa ,

foggy_lad · 20-01-2015 5:09pm

Jasper79 wrote: »

Sounds interesting I have a property and would be interested in something like this, but still seems very risky.

1)The Council select the tennants, but landlord has to deal with them as the council just act as a broker , could lead to all sorts of problems depending on the tennant.

2)Council pays current market rate, will it increase each year for the 4 year period if the market does .

3) They "May" reimbourse property damage up to the value of one months rent.

These would be the main reasons as a landlord I don't think RAS is worth getting involved in . Especially now when demand is high.

There is a full Gardai check on potential tenants and the LL usually has a veto on any tenant as well so local knowledge of scumbaggery that had not grabbed Gardai attention could be acted upon.

Rents are reviewed usually every 2 years.

Remember also that the council will continue to pay as long as the place is occupied even when eviction proceedings are brought by the LL or if the council tells LL to start eviction process over tenant not paying the councils rent or other issues. in a normal tenancy the LL could lose out on a years rent or more plus damages.

Gatling wrote: »

It's a full garda backround check according to sdcc housing department .
So drugs and anti social behaviour gets refused,
But it can be bypassed usual by the applicant saying say a single mother applies she can come back with no issues but an undeclared partner/ family member who could be major trouble just moves in and vice versa ,

If someone moves in the LL simply starts the eviction process and that is that! afaik the council will pay the rent while eviction is ongoing and if they are made aware of others living in the property the council can "force" the LL to start the eviction process or they would stop paying the rent.

Gumbo · 20-01-2015 5:20pm

Fingal are not paying full market rate everywhere.
I received contracts from them this week with regards to a house.

Current private rate is €1400 per month (4 bed house).
10 year long term lease offer was €1145
RAS offer is €1300

murphaph · 20-01-2015 6:33pm

kceire wrote: »

Fingal are not paying full market rate everywhere.
I received contracts from them this week with regards to a house.

Current private rate is €1400 per month (4 bed house).
10 year long term lease offer was €1145
RAS offer is €1300

Interesting. Did they clearly state that they were deliberately offering less than market rate?

Marcusm · 20-01-2015 7:00pm

murphaph wrote: »

Interesting. Did they clearly state that they were deliberately offering less than market rate?

The 8% discount reference re SDCC sounds to me as though they are seeking to discount to reflect the absence of a letting agent rather than anything else.

Mrs OBumble · 22-01-2015 7:08pm

foggy_lad wrote: »

There is a full Gardai check on potential tenants and the LL usually has a veto on any tenant as well so local knowledge of scumbaggery that had not grabbed Gardai attention could be acted upon.

While a full Gardai check sounds attractive, the fact is that having a criminal conviction doesn't (generally) excuse the council's responsibility to house someone.

So unless the LL gets to see the vetting-result and has a guaranteed right of veto (which I think they don't), then it's not much help at all.

The fact that the guards don't have a problem with a person living in a certain area doesn't necessarily mean that you want them as a tenant.

yankinlk · 22-01-2015 7:48pm

kceire wrote: »

Fingal are not paying full market rate everywhere.
I received contracts from them this week with regards to a house.

Current private rate is €1400 per month (4 bed house).
10 year long term lease offer was €
RAS offer is €1300

i recon u did well to get that rate. im not familiar with the area, but i am with Ras and in my area they arent even close to market rate last i checked.

/ironic story
CC recently called my daft ad, to see if i would offer less than advertised for a RAS client. i had over 2000 views and multiple offers above asking from desperate families, so i told them to walk on. they would not budge.

the number popped up in the phone, i had saved it from when they called to complain about a previous RAS tenant i eventually evicted.

Gumbo · 22-01-2015 10:17pm

murphaph wrote: »

Interesting. Did they clearly state that they were deliberately offering less than market rate?

Yes. They state in their letter of offer that they expect a discount to allow for the security of payments.

murphaph · 22-01-2015 10:20pm

kceire wrote: »

Yes. They state in their letter of offer that they expect a discount to allow for the security of payments.

Thx. I would be tempted to say I expect a premium as so few LLs are interested in their scheme! (it's been widely reported that LLs are leaving RAS in droves in Dublin at least)

Gumbo · 22-01-2015 10:46pm

murphaph wrote: »

Thx. I would be tempted to say I expect a premium as so few LLs are interested in their scheme! (it's been widely reported that LLs are leaving RAS in droves in Dublin at least)

My letter is from Fingal County Council for a house in the Dublin 11 area.

cerastes · 22-01-2015 11:07pm

murphaph wrote: »

Had a quick look at SDCC's site and they still mention a "discount":

"Rent levels will reflect local market conditions but must show an 8% reduction on current market rents applicable at time of contract signing."

So, obviously a localised phenomenon.

I considered the RAS scheme myself, but with so much available interest, there seemed few if any reasons to get into such an agreement, but especially after looking into it.

For a start, the only calculation I saw showed that the "rent" starting point was below what could be achieved anyway, they then applied another percentage deduction on top of this, not realistic, Id already turned my back at this point and had to decline what seemed like reasonable tenants. Now all I can see is a very basic 8% deduction but I dont think it is that simple.

Another few things besides them not considering a deposit is, they only say, they "may" be willing to guarantee damage up to one months rent, but not where a tenant has already provided a deposit.
It has always seemed to me that the council (any that wants this scheme to be used) wants the best of every world.
Initially, I understood when I first heard of it that the reductions also would account not only for the security of a long lease for them, landlords and tenants, but that would redecorate every 5 years (potentially twice in the lease signed up for by the landlord) and and any and all damage would be rectified, there may have been something about providing or repairing appliances, now not only is everything down to the landlord no security is provided,no liability or risk for the council, a reduced rental cost, and the landlord is effectively stuck with the tenants and the council for longer than they would ever be required in any other situation, on top of that at the whims of what the council deems is an appropriate rent, and all the obligations to deal with antio social behaviour are with the landlord instead of jointly or by the council supporting the landlord. Its no surprise landlords are leaving in droves, it obviously is as one sided as it sounds, thats no incentive for anyone else to get into it. Anyone would be mad to get into this and the council must be too if they think they can get anyone in other than by deceit.
At this stage they'd need to be offering above market rates or at the least a cheaper option for them, a guaranteed security for the landlord in the form of a serious warning to a tenant to ensure cooperation, that they will be at the back of a long line and that the council will support an eviction if they fall out of line regarding damage or anti social behaviour.

murphaph wrote: »

Thx. I would be tempted to say I expect a premium as so few LLs are interested in their scheme! (it's been widely reported that LLs are leaving RAS in droves in Dublin at least)

A premium in the least, support, instead the council openly admits they are casting any landlord adrift, that involves themselves in this with a them.

Del2005 · 23-01-2015 1:57am

cerastes wrote: »

I considered the RAS scheme myself, but with so much available interest, there seemed few if any reasons to get into such an agreement, but especially after looking into it.

For a start, the only calculation I saw showed that the "rent" starting point was below what could be achieved anyway, they then applied another percentage deduction on top of this, not realistic, Id already turned my back at this point and had to decline what seemed like reasonable tenants. Now all I can see is a very basic 8% deduction but I dont think it is that simple.

Another few things besides them not considering a deposit is, they only say, they "may" be willing to guarantee damage up to one months rent, but not where a tenant has already provided a deposit.
It has always seemed to me that the council (any that wants this scheme to be used) wants the best of every world.
Initially, I understood when I first heard of it that the reductions also would account not only for the security of a long lease for them, landlords and tenants, but that would redecorate every 5 years (potentially twice in the lease signed up for by the landlord) and and any and all damage would be rectified, there may have been something about providing or repairing appliances, now not only is everything down to the landlord no security is provided,no liability or risk for the council, a reduced rental cost, and the landlord is effectively stuck with the tenants and the council for longer than they would ever be required in any other situation, on top of that at the whims of what the council deems is an appropriate rent, and all the obligations to deal with antio social behaviour are with the landlord instead of jointly or by the council supporting the landlord. Its no surprise landlords are leaving in droves, it obviously is as one sided as it sounds, thats no incentive for anyone else to get into it. Anyone would be mad to get into this and the council must be too if they think they can get anyone in other than by deceit.
At this stage they'd need to be offering above market rates or at the least a cheaper option for them, a guaranteed security for the landlord in the form of a serious warning to a tenant to ensure cooperation, that they will be at the back of a long line and that the council will support an eviction if they fall out of line regarding damage or anti social behaviour.

A premium in the least, support, instead the council openly admits they are casting any landlord adrift, that involves themselves in this with a them.

If a tenant is renting for >6 months don't they automatically get part 4 rights which enables them to stay for 4 more years after the 1st year? So a 5 year RAS contract would be similar. While there currently is a LL's market it wasn't that long ago that people were getting rent decreases, it could easily swing back.

cerastes · 23-01-2015 2:27am

Del2005 wrote: »

If a tenant is renting for >6 months don't they automatically get part 4 rights which enables them to stay for 4 more years after the 1st year? So a 5 year RAS contract would be similar. While there currently is a LL's market it wasn't that long ago that people were getting rent decreases, it could easily swing back.

5 year, Ive heard 10 year, tenants could get virtually that in a standard part 4, landlords generally dont want to take someone on for 6 months so most will have 4 years rights to rent.
And no, its 3.5 years after the first 6 months or 4 years total, big difference to ten years.
A RAS contract is no where near similar,and there is nothing to suggest a council wouldnt try re negotiate downwards, but most of all, a landlord has all the responsibility and the council takes none whatsoever. It may be unlikely to be worth getting into that kind of agreement with a tenant selected by the council.
You're saying its very alike, Im saying it isnt, as another poster has suggested, landlords leaving in droves suggests it is one sided.
I was never referring to increases or decreases, its the uncertainty over RAS tenants and the large reduction offered by the councils as a benefit for letting security, which there seems to be little in certain aspects and the complete one sidedness of the entire agreement.

Gumbo · 23-01-2015 10:01am

cerastes wrote: »

5 year, Ive heard 10 year, tenants could get virtually that in a standard part 4, landlords generally dont want to take someone on for 6 months so most will have 4 years rights to rent.
And no, its 3.5 years after the first 6 months or 4 years total, big difference to ten years.
A RAS contract is no where near similar,and there is nothing to suggest a council wouldnt try re negotiate downwards, but most of all, a landlord has all the responsibility and the council takes none whatsoever. It may be unlikely to be worth getting into that kind of agreement with a tenant selected by the council.
You're saying its very alike, Im saying it isnt, as another poster has suggested, landlords leaving in droves suggests it is one sided.
I was never referring to increases or decreases, its the uncertainty over RAS tenants and the large reduction offered by the councils as a benefit for letting security, which there seems to be little in certain aspects and the complete one sidedness of the entire agreement.

RAS is 5 year contract.
Long term lease scheme is 10 years.
(Fingal County Council)

Councils now paying full market rates for RAS?

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