Any landlords renting under the RAS scheme?

Moonbeam

I have been asked by tenants to rent the house out under the RAS scheme.
I am looking through it and the long contract sutis me but the rent under it is slightly less then I get from them now.
I can see loads of advantages for the council and the tenants but I am not seeing any for the landlords?

foggy_lad

Moonbeam wrote: »

I have been asked by tenants to rent the house out under the RAS scheme.
I am looking through it and the long contract sutis me but the rent under it is slightly less then I get from them now.
I can see loads of advantages for the council and the tenants but I am not seeing any for the landlords?

One of the main advantages for Landlords is the long lease and a guarantee of rent paid by the council for the duration of that lease even if the property is vacant, set this against most rental properties where there can be long gaps between lettings where there is no tenants paying rent and also the cost of re-decorating and painting between lettings. The landlord is also guaranteed the rent by the council as long as they keep on top of their responsibilities and maintain the property etc. With private lettings rent can go unpaid for months and several months rent can be lost if a tenant stops paying then does a bunk.

Tenants are also vetted by councils and are apparently Garda vetted to ensure they are not involved in any anti-social behaviour or involved in other crimes such as drugs offences., although I think some councils can be more strict on this than others.

murphaph

Where is the property in question OP? If in an area of high demand (Dublin for sure) then RAS may well not be the optimum solution. A property in a difficult to let area is a different matter.

I take it you'd sign an "in-situ" contract that terminates if/when your existing (presumably good??) tenants leave the property. I wouldn't entertain RAS under the normal "we can nominate whomever we like to live in your property and will not give you any more than a month's rent to fix the place when they trash it".

hfallada

As far as I know RAS tend to give below the market monthly rate as they are letting it for so long. It the house/apartment was in Dublin or Galway in a good area I wouldnt do it as rents and rising and its easy to find a replacement tenant

Moonbeam

When I rang the ras people about how much the rent was I am pretty sure she told me that if the tenant leaves during the 5 years well then that is my contract with the council over,another person told me if the tenant falls behind with rent then it is up to me to chase them for it even so the council pays me but I can not evict them ?
It suits me to have a long lease,the longer the better the tenants are not irish but she is a sister of my previous tenant and I am happy with them.

It is in a really really easy to rent out houses area.

foggy_lad

Moonbeam wrote: »

When I rang the ras people about how much the rent was I am pretty sure she told me that if the tenant leaves during the 5 years well then that is my contract with the council over,another person told me if the tenant falls behind with rent then it is up to me to chase them for it even so the council pays me but I can not evict them ?
It suits me to have a long lease,the longer the better the tenants are not irish but she is a sister of my previous tenant and I am happy with them.

It is in a really really easy to rent out houses area.

In Carlow the leases are for almost 10years and if the tenant leaves it is up to the council to find another suitable tenant who is acceptable to the Landlord because they are paying the rent to the LL for the duration of the lease. If a tenant falls behind with their rent payments to the council they will let the LL know and it is then up to the LL to give the appropriate notices of arrears, eviction etc.

The council may also require a first refusal clause in the case where a LL wants to sell up before the end of the lease.

Moonbeam

I would love to sell it:) the house is in Fingal.
Thanks for the info.
I dunno if I would like the council finding me tenants but would lvoe it rented out for 10 years:)

murphaph

Moonbeam wrote: »

I would love to sell it:) the house is in Fingal.
Thanks for the info.
I dunno if I would like the council finding me tenants but would lvoe it rented out for 10 years:)

Fingal will sign a modified lease if you wish that only applies to the current tenants. Once they leave, agreement terminates. This means you don't need to worry about the council nominating dodgy tenants. If you're happy with a slightly lower than market rent then you are good to go. The rent will be reviewed every 3 years or so and in the event of there being no agreement, it will be decided by a local valuer.

bacon?

How much below the current market price does the council offer? What sort of tax do you pay on the rent?

murphaph

Fingal are currently paying 840 per month on 2 bed units. That'll give you an idea. Tax has nothing to do with RAS and is individual to each landlord.

Edit..in D15 at any rate.

Moonbeam

They told me 760 a month for 2 bed units, 2 adults and 2 small children.
Tax is about 20% or that is how they work it out for non resident landlords of course you can claim expenses against that too.

The_Conductor

The rent is typically around 10% below the market rent for the area.
You remain as landlord to the tenants, and for all intents and purposes, its a private rental agreement between you and the tenants (and you have to register the tenancy with the PRTB etc, as you would with any other tenant).

If any issues arise- you, as landlord, are responsible for resolving it. The council are merely an intermediary between you and the tenant, nothing more.

A few issues-

1. Rent can be paid at vastly different times of the month- it may be paid on the 1st of the month one month, and not until the 12th or 14th the next month- depending on random factors, over which you have limited control.

2. The council can unilaterally decide to reduce the rent paid, without notice, you have no control over this.

3. The tenants will have been used to council accommodation and may think that its their right to modify the property- which is obviously wrong. Have a look in this forum- this has cropped up a few times.

4. You need to furnish tax clearance certs annually to the council- which for someone who may be letting their sole property- is a fair bit of paperwork. Just doing a regular tax return for the property is far easier- plus you'll still have to register the tenancy with the PRTB as you'd have to do anyway.


Moonbeam- you say the property is in an area where its very easy to let it. While a longer term lease may sound attractive- its at a lower rent- and you still have all the obligations of a landlord that you currently have. Personally I don't think its worth the hassle- its entirely up to you though.

The only upside to this is no vacant periods- but, if its in an easy to let areas- this probably isn't an issue to begin with?

foggy_lad

smccarrick wrote: »

The rent is typically around 10% below the market rent for the area.
You remain as landlord to the tenants, and for all intents and purposes, its a private rental agreement between you and the tenants (and you have to register the tenancy with the PRTB etc, as you would with any other tenant).

If any issues arise- you, as landlord, are responsible for resolving it. The council are merely an intermediary between you and the tenant, nothing more.

A few issues-

1. Rent can be paid at vastly different times of the month- it may be paid on the 1st of the month one month, and not until the 12th or 14th the next month- depending on random factors, over which you have limited control. afaik the council pay the LL on a specified date each month, the tenants pay the Council weekly.

2. The council can unilaterally decide to reduce the rent paid, without notice, you have no control over this. The council can only decrease the rent after a rent review which usually takes place every two years, it must also be agreed by the LL or the LL can give notice of termination of the lease

3. The tenants will have been used to council accommodation and may think that its their right to modify the property- which is obviously wrong. Have a look in this forum- this has cropped up a few times. Tenants are usually those who are not used to council accommodation and who have no history of any anti-social/criminal behaviour, Councils wouldn't bother otherwise as no landlord would sign up to having problem families as tenants

4. You need to furnish tax clearance certs annually to the council- which for someone who may be letting their sole property- is a fair bit of paperwork. Just doing a regular tax return for the property is far easier- plus you'll still have to register the tenancy with the PRTB as you'd have to do anyway.


Moonbeam- you say the property is in an area where its very easy to let it. While a longer term lease may sound attractive- its at a lower rent- and you still have all the obligations of a landlord that you currently have. Personally I don't think its worth the hassle- its entirely up to you though.

The only upside to this is no vacant periods- but, if its in an easy to let areas- this probably isn't an issue to begin with?

Most of the tenants will be decent people who for whatever reason have found themselves in need of housing and they are not a high priority on the housing lists because they would rather rent and get rent allowance or RAS than live in council estates. some people are suited to council estates and others are not.

also the stories of tenants tearing out walls inside to change rooms around is not that common as the lease is quite specific and is explained very well by the RAS officer of the council before occupancy.

The_Conductor

Google people's experiences of the scheme in this forum- it'll give you an idea of some of the issues that have arisen for people here.

murphaph

smccarrick wrote: »

1. Rent can be paid at vastly different times of the month- it may be paid on the 1st of the month one month, and not until the 12th or 14th the next month- depending on random factors, over which you have limited control.

I'm currently transitioning to RAS from RS in Fingal. They've promised to pay on the 15th of the month. I'll be pretty pissed off if it's just paid at random!

smccarrick wrote: »

2. The council can unilaterally decide to reduce the rent paid, without notice, you have no control over this.

Not according to the contract I have just signed. That states that the rent is to be decided by negotiation. If no agreement can be reached a local MIAVI gets to decide a fair market rent which both parties agree to be bound to.

smccarrick wrote: »

3. The tenants will have been used to council accommodation and may think that its their right to modify the property- which is obviously wrong. Have a look in this forum- this has cropped up a few times.

It depends on the RAS contract. My tenants have never lived in council property and are moving to RAS for the first time.

smccarrick wrote: »

4. You need to furnish tax clearance certs annually to the council- which for someone who may be letting their sole property- is a fair bit of paperwork. Just doing a regular tax return for the property is far easier- plus you'll still have to register the tenancy with the PRTB as you'd have to do anyway.

A tax clearance certificate is a formality. I just do regular tax returns and revenue had no problem issuing the cert.

smccarrick wrote: »

Moonbeam- you say the property is in an area where its very easy to let it. While a longer term lease may sound attractive- its at a lower rent- and you still have all the obligations of a landlord that you currently have. Personally I don't think its worth the hassle- its entirely up to you though.

This is the crux of the issue. If moonbeam is non resident like me, RAS can make some sense that it otherwise wouldn't. If moonbeam can manage the property locally I wouldn't advise RAS too quickly.

murphaph

smccarrick wrote: »

Google people's experiences of the scheme in this forum- it'll give you an idea of some of the issues that have arisen for people here.

Absolutely. RAS is no magic bullet. The scheme could be seriously improved.

Moonbeam

I am resident but maybe not be for the next 10 years:)
Thanks for all the info,the tenants are related to my previous tenants and I am happy with them.
I only live an hour from Balbriggan where the house is,the new tenants are not irish.
The tenants will be coming from rent supplement.
Is ras cheaper for the tenants?
I am totally tax complaint.

The_Conductor

The one big point I'd make- is you are still the landlord, and responsible for the property. The council do not maintain the property or take care of any issues that arise for the tenants. If you're not going to be resident- you will really need to nominate an agent to take care of these responsibilities. Hopefully very little would be involved, but its difficult to tell, and you should expect the unexpected.

A lot of people assume that the council are taking care of the property and its maintenance- unfortunately, they're not. They are simply middlemen between you and the tenant.

A longer term lease may suit you better, regardless of the lower monthly rental income, if there is the possibility that you're going to be moving abroad- but you need to take everything into consideration.

murphaph

Moonbeam wrote: »

I am resident but maybe not be for the next 10 years:)
Thanks for all the info,the tenants are related to my previous tenants and I am happy with them.
I only live an hour from Balbriggan where the house is,the new tenants are not irish.
The tenants will be coming from rent supplement.
Is ras cheaper for the tenants?
I am totally tax complaint.

It costs the tenants the same AFAIK.

Sheep Shagger

Have a tenant in situ for a couple of months (got stung with the last one) but so far no issues.

They've asked me if I would be interested in signing up for RAS.

Have done a little bit of research online (including here), like anything there a pros and cons. It's not in a hard to rent area but in saying that it can be a pain having to go through the whole interim/vetting process.

The tenants say they would like to stay long term (and at this point I'd have no problem in facilitating that under the status quo).

My main question is, is there a list/matrix of what councils pay (I'm probably charging a little below market as it is, will I be knocked down any further?). Would be in SDCC.

Also would not like the CC to be able to just put anyone in, ideally if these people left the agreement would terminate?

Finally, presume are there any 'get out' clauses if required for the landlord (if I wanted to sell say 3 years down the line?)

Am fully tax compliant, understand I have to stay registered with the PRTB and maintain the place the same as I do today so apart from guaranteed rent there's not much difference?!?

Is the main benefit to the tenant just that they have a long term lease ?

EDIT: found this link which is helpful, any landlord who has rented on a tenancy by tenancy agreement through SDCC with any thoughts would be great to hear from.

http://www.sdcc.ie/sites/default/files/guidelines/ras-information-for-landlords-september-2012.doc

Main question remains, is there a set amount they pay for a 2 bed apartment with one bathroom or would they simply take 8% off what the tenants pay today (which is probably a bit below market).

murphaph

Sheep Shagger wrote: »

Main question remains, is there a set amount they pay for a 2 bed apartment with one bathroom or would they simply take 8% off what the tenants pay today (which is probably a bit below market).

In my experience transitioning to RAS with Fingal they have a set rate for a type of property in a given area. I saw rent increase in fact as I was charging these particular tenants a bit below the market rate as they were very solid.

80sbaby

Hi

I'm really hoping that someone out there can offer me some advice
I am a PAYE worker, I take home approx €500 a week, my wife has been unemployed for 2 years and not entitled to jobseekers we've got 3 children under 4 and 2 mortgages,
I'm hoping to rent our 2nd property (3 bed semi)to the council but apparently I need a tax clearance cert, I've looked on revenue.ie and it says that tax certs are not applicable to PAYE workers.

Does anyone know what steps I need to take to approach the council. Our situation is desperate so I need to do something with that second house asap,

Thank you in advance

murphaph

You should contact your local tax office directly and request a TCC anyway. If they refuse because you are "just" PAYE then request to be registered for Income tax by them. If you do however you may be required to file your returns on a Form 11 instead of a Form 12 (only available to PAYE & Pensioners). The Form 12 is slightly advantageous in that you are not required to actually forward any tax payment (they adjust your tax credits the following year so you pay more tax from your PAYE income) and you are not obliged to pay preliminary tax.

First of all see can you get a TCC being PAYE only. You can chance your arm and complete the TC1 form at least. It's only a short thing with your PPS and a few other bits. I'm almost certain I obtained a TCC when I was still PAYE in Ireland.

Sheep Shagger

I'm PAYE and just recently got a tax clearance cert.

Ring Revenue, they'll need to register you which takes a few days.

You'll then be able to request the cert online.

80sbaby

Sheep Shagger wrote: »

I'm PAYE and just recently got a tax clearance cert.

Ring Revenue, they'll need to register you which takes a few days.

You'll then be able to request the cert online.

thank you both for replying, I will give them a call tomorrow,