Is there a rental shortage in Dublin?

murphaph

Speaking as a landlord I dislike the way the market operates in Ireland. We need some sort of rent control to prevent these large swings in the rental market. If renting instead of buying in Ireland is genuinely to become a real prospect, then tenants need to now their rent can only go up by x% each year, even if the local market rents for new tenancies have increased by x + y%. There should be exceptions that allow rent increases if the landlord has carried out modernisation works to the property, especially energy saving works, but again controlled increases.

Having said that, rents should NEVER decrease!!

If we had rent controls we could settle down for the long haul with good long term tenants. We could move towards unfurnished lettings (fewer headaches for LL and tenant sits on a couch he actually likes the colour of!).

Some landlords will think I'm mad and I must qualify everything I say with the following: the PRTB are not fit for purpose and should not be let any hand, act or part in any reforms I talk about. It should all be privatised so it has a chance of efficient running!

who_ru

murphaph wrote: »

It should all be privatised so it has a chance of efficient running!

and to be administered by who exactly?

Ray Palmer

murphaph wrote: »

Speaking as a landlord I dislike the way the market operates in Ireland. We need some sort of rent control to prevent these large swings in the rental market. If renting instead of buying in Ireland is genuinely to become a real prospect, then tenants need to now their rent can only go up by x% each year, even if the local market rents for new tenancies have increased by x + y%. There should be exceptions that allow rent increases if the landlord has carried out modernisation works to the property, especially energy saving works, but again controlled increases.

Having said that, rents should NEVER decrease!!

If we had rent controls we could settle down for the long haul with good long term tenants. We could move towards unfurnished lettings (fewer headaches for LL and tenant sits on a couch he actually likes the colour of!).

Some landlords will think I'm mad and I must qualify everything I say with the following: the PRTB are not fit for purpose and should not be let any hand, act or part in any reforms I talk about. It should all be privatised so it has a chance of efficient running!

What are these large swings you are talking about? Even people coming on here complaining about hikes in rent aren't talking about wild swings just increases they don't want.
There is basically a resistance to increase rents which means going to the hassle of increase rent by 5% doesn't happen. People instead leave it an wait and then when they increase the rent it is by 10%. It is a mental tipping point. The current rules you can't jump up the rent beyond the market how is that failing people? I am not aware of it not working so you seem to be coming up with a solution to a problem that doesn't exist.
Why you would put a restriction on rental property that doesn't apply to any other market in this country is a mystery suggestion. Is a pub stopped from putting up it's prices unless they decorate or improve their service, a hospital, doctor, insurance, banking etc... Who is going to invest in such a market?
Rent controls don't really work just look what happens in New York. You end up with extremely poor rental properties. Places where it is working have completely different model and history with mass subsidies making it happen. You can't even make these subsidise under EU law now. So unless you want the country to be a former communist state or destroy the majority of housing in a bombing campaign it isn't going to happen.

Of course this also requires ignoring plans in place to bring rental standards up. You know where the government has set new rental standards that will have to be met. Like the removal of bedsits being part of it. So rental standards are improving without any of your suggestions.

It's not as a landlord I object to your suggestions but as somebody who has looked at the situation because I am a landlord. The state rely on private LL to provide rent al property. Your suggestions would just restrict property and ultimately lead to poorer rental properties. Not only that is doesn't seem to be a issue in the first place unless the complaint is rents are too high. The solution for that is to provide more rental property not less.

murphaph

Ray Palmer wrote: »

Why you would put a restriction on rental property that doesn't apply to any other market in this country is a mystery suggestion. Is a pub stopped from putting up it's prices unless they decorate or improve their service, a hospital, doctor, insurance, banking etc... Who is going to invest in such a market?

I didn't suggest that rents could only go up if a property was renovated. Perhaps you should read my post again.

In answer to your question about who would invest in a rent controlled market however I would direct you to Germany, which despite rent controls has massive investment from huge companies that own tens of thousands of units. So rent controls do not equate to a shortage or lack of investors in the rental sector generally. The system in Ireland needs a radical overhaul however and rent controls should form just a part of that overhaul which should include the freedom to rent out completely unfurnished (ie bare bones, kitchen optional!) and the ability to swiftly evict non-paying tenants.

In commercial leases it is not uncommon for rent increases to be tied to an inflation index, rather than some more vague notion of "market rent" which can swing quite wildly. I was charging €1200 at one stage for a property but the market collapsed in 2009 and the tenants were able to point to rapidly falling asking prices for neighbouring properties so I had no choice bu to reduce to €800 over the course of 18 months. It's now gone back up but not to what it was. 400/1200 is a 33.33% fall Ray and such falls were not uncommon over the past few years in Dublin West at least. I classify a fall of 1/3 as a wild swing anyway.

I reiterate: there should be no rent controls introduced unless as part of a holistic reform of the rental sector to provide security to landlords as well as tenants (whom the law currently favours quite clearly)

Ray Palmer

murphaph wrote: »

I didn't suggest that rents could only go up if a property was renovated. Perhaps you should read my post again.

In answer to your question about who would invest in a rent controlled market however I would direct you to Germany, which despite rent controls has massive investment from huge companies that own tens of thousands of units. So rent controls do not equate to a shortage or lack of investors in the rental sector generally. The system in Ireland needs a radical overhaul however and rent controls should form just a part of that overhaul which should include the freedom to rent out completely unfurnished (ie bare bones, kitchen optional!) and the ability to swiftly evict non-paying tenants.

In commercial leases it is not uncommon for rent increases to be tied to an inflation index, rather than some more vague notion of "market rent" which can swing quite wildly. I was charging €1200 at one stage for a property but the market collapsed in 2009 and the tenants were able to point to rapidly falling asking prices for neighbouring properties so I had no choice bu to reduce to €800 over the course of 18 months. It's now gone back up but not to what it was. 400/1200 is a 33.33% fall Ray and such falls were not uncommon over the past few years in Dublin West at least. I classify a fall of 1/3 as a wild swing anyway.

I reiterate: there should be no rent controls introduced unless as part of a holistic reform of the rental sector to provide security to landlords as well as tenants (whom the law currently favours quite clearly)

Maybe you should take your own advise as I mentioned Germany in my post. The only reason they have the situation is due to mass bombing during WWII. The international community subsidised their property investment allowing large companies to manage property. Effectively they were given a free asset to manage that was later sold and managed by investment companies. This property also has to remain residential only possible due to destruction of residential privately owned property with mass deaths of the owners. That is how it happened so to replicate it you need to do the same and wait some 60-70 years for it to work out. The set-up scenario for this situation is why it exists not a plan that can be replicated.

You certainly did suggest rents could only increase beyond a limit with investment. Which is what I said was not reflected in any other market. Removing investment potential.

A third rent change over a number of years is not the same as a rent change in a year. You are exaggerating the rent change by compiling years together.

Commercial rent is under vastly different laws and rules which no residential tenant would be happy with. Apple and oranges.

I didn't have to reduce my rent by a third or close to it. No wild swings in my rental income.

murphaph

Then we'll agree to differ on this one Ray. Enjoy your day.

Ray Palmer

murphaph wrote: »

Then we'll agree to differ on this one Ray. Enjoy your day.

You can't really say that. We can have different views on a solution and agree to disagree on that . You have stated things actually work a different way to the reality or involve rewriting history. Germany is always held up as a shining example of how things should work but ignoring how it happened is the same as ignoring how it can't be reproduced.

Sierra Oscar

D3PO wrote: »

ive yet to hear of somebody go homeless because they couldn't find somewhere to rent.

I am dealing with a good few people in work who are currently in emergency accommodation because they have been asked to vacate their rented property, and their rent allowance no longer covers the rising rent. The council have absolutely no stock left either. There are plenty of people in emergency accommodation for well over a year now, when emergency accommodation itself is only meant to last a few weeks. The supply is just non-existent in many parts of the city.

The sad reality is that the next stop for those in emergency accommodation is living on the streets and moving from hostel to hostel.

I also spent some time in a homeless shelter within the last week and there were a few in there who were made homeless due to the rising rents and requirements to vacate the rented accommodation that they were in.

murphaph

Ray Palmer wrote: »

You can't really say that. We can have different views on a solution and agree to disagree on that . You have stated things actually work a different way to the reality or involve rewriting history. Germany is always held up as a shining example of how things should work but ignoring how it happened is the same as ignoring how it can't be reproduced.

People said the smoking ban would never work in Ireland because of our cultural history of smoky pubs. Almost overnight it did work. Things can change. Germany isn't the only place with rent controls. You don't have to raze a country to the ground to have rent controls either. I live in a pre-war building like most of the residents of this city but rent controls apply.

Ray Palmer

Sierra Oscar wrote: »

I am dealing with a good few people in work who are currently in emergency accommodation because they have been asked to vacate their rented property, and their rent allowance no longer covers the rising rent.

Is this not just a case of people can't afford to rent the property they were in and the state doesn't provide accommodation?

I feel bad for anybody in the situation but it is the state who are responsible not LL. The state have failed these people not the free market.

Ray Palmer

murphaph wrote: »

People said the smoking ban would never work in Ireland because of our cultural history of smoky pubs. Almost overnight it did work. Things can change. Germany isn't the only place with rent controls. You don't have to raze a country to the ground to have rent controls either. I live in a pre-war building like most of the residents of this city but rent controls apply.

I am not saying it is a cultural difference which was what people were saying about the smoking ban. It is a hard economic fact how Germany has it's rent control and laws. It was economically possible due to a certain set of circumstances. Those circumstances don't exist here and EU stops it from being done again. There is much more to this than just changing Irish law.
You do also get that just because the building you are in was pre-war the ownership and financial incentives to use it as residential rental were all done at the same time. The government seized assets and gave them away over time. You can't do that here and now.

Rent controls in other countries result in poorer rental property not better. Look at New York. I have been in rent controlled property there at it is squalid. Many let out without rent being charged so the LL doesn't have to do the property out.

Where is the money going to come from? It all has to be raised privately without the government funding it. Where it is run by the government it is all loss making. Hence they don't want to develop any more social housing. If you thing you can get it to work go raise the money. Why has nobody else done it if it so easy?

Sierra Oscar

Ray Palmer wrote: »

Is this not just a case of people can't afford to rent the property they were in and the state doesn't provide accommodation?

No, it is a case that demand is so high that rents are rising and pushing many properties beyond the reach of people that could afford them before.

If there wasn't a rental shortage then we would not be seeing rental prices increasing by 7% in the capital in a single quarter in my view.

Ray Palmer

Sierra Oscar wrote: »

No, it is a case that demand is so high that rents are rising and pushing many properties beyond the reach of people that could afford them before.

Not seeing how that is different from what I said. People can't afford to pay the rent where they once were and the state provides no alternative. Not seeing why a private LL should subsidise rent to these people. That is the job of the state.
People complained RA was keeping rents high for many years. Here is why it was high and the state no longer want to match market rates. Your issue is with the state nobody else.

dinnyirwin

Sierra Oscar wrote: »

I am dealing with a good few people in work who are currently in emergency accommodation because they have been asked to vacate their rented property, and their rent allowance no longer covers the rising rent. The council have absolutely no stock left either. There are plenty of people in emergency accommodation for well over a year now, when emergency accommodation itself is only meant to last a few weeks. The supply is just non-existent in many parts of the city.

The sad reality is that the next stop for those in emergency accommodation is living on the streets and moving from hostel to hostel.

I also spent some time in a homeless shelter within the last week and there were a few in there who were made homeless due to the rising rents and requirements to vacate the rented accommodation that they were in.

If social welfare want to change the conditions that they created themselves in the last few years, then i think now they are going to have to pay a premium. Most landlords now would accept rent allowance, but only if it was at a rate higher than the normal rent achievable, and paid directly to them. landlords are no longer prepared to risk dealing with the whims of the dept social welfare