Property Market 2018

sunnyday1234

Boatswain wrote: »

2012 was a long time ago?

Yes , in economic expansion terms. The longest period of expansion ever in the US was 10 years from 1991 to 2001. This current expansion in the US started in 2009 so its 9 years old now and already longer than most historical expansions. Our own expansion started in 2012 and was delayed because of how bad our crash was

Stock markets are very lofty, interest rates in US are heading upwards. These are usually what triggers a correction / recession

Samuel T. Cogley

mel123 wrote: »

Are we going to have a rental crisis for the foreseeable?
I see it as a bit of a catch 22. I do agree about lending criteria to an extent, but say for example a couple out renting now on average or even a bit above average salaries, how are they going to save to buy a house in the next few years? Are these people stuck in a renting bubble now rather than being able to buy?

Until renters start realising it's government policy to keep rents high and start putting real pressure on to intervene in a meaningful way (i.e. restore and increase tax relief for renters) the rental crisis will continue. It's far easier to buy into the narrative that LL's are bastards though.

Best smoke and mirrors job by a government in decades.

Samuel T. Cogley

Samuel T. Cogley wrote: »

Until renters start realising it's government policy to keep rents high and start putting real pressure on to intervene in a meaningful way (i.e. restore and increase tax relief for renters) the rental crisis will continue. It's far easier to buy into the narrative that LL's are bastards though.

Best smoke and mirrors job by a government in decades.

When such things are suggested for mortages the response is that it will just put prices up. Why would it be different for rent?

Samuel T. Cogley

Deleted User wrote: »

When such things are suggested for mortages the response is that it will just put prices up. Why would it be different for rent?

True enough that rental caps would have to be properly enforced first, but we are creeping, ever so slowly, towards that.

Bob24

Samuel T. Cogley wrote: »

Deleted User wrote: »

When such things are suggested for mortages the response is that it will just put prices up. Why would it be different for rent?

True enough that rental caps would have to be properly enforced first, but we are creeping, ever so slowly, towards that.

I’d say the only potential effective way to implement tax breaks / caps would be to offer landlords an attractive tax incentive in exchange for a moderate rent (let them chose whether they want to take part of not, but make it such as both things go hand in hand).

A massive problem though would be how to decide what is a moderate rent. If you take two originaly identical houses next to each other for rent on the same street - if one landlord has kept in in so-so condition while the other one has just fully renovated it to very high standard, it is clear a moderate rent for the second one would be higher than a moderate rent for the first one. Correctly assessing that difference would be critical otherwise only properties in poor condition would be added to the scheme, but is it very hard to do in a systematic way.

The Student

Deleted User wrote: »

When such things are suggested for mortages the response is that it will just put prices up. Why would it be different for rent?

Why not extend the rent a room relief to landlords. Rents under €1k no tax anything above tax on all of it. The landlord is no worse off, the tenant pays less rent and therefore can save for a deposit.

Its a win win for both!

Bob24

The Student wrote: »

Deleted User wrote: »

When such things are suggested for mortages the response is that it will just put prices up. Why would it be different for rent?

Why not extend the rent a room relief to landlords. Rents under €1k no tax anything above tax on all of it. The landlord is no worse off, the tenant pays less rent and therefore can save for a deposit.

Its a win win for both!

Firstly this would probably require significantl funding to compensate for lost tax revenue if many landlord were to join the scheme. Not necessarily a deal breaker but not a trivial question either.

Secondly and more importantly it could overtime create a two tiers rental market in high demand areas with only poor quality and small accommodation available under the scheme in those areas (as there would be no incentive for landlords to renovate there property if the resulting increased rental value is all eaten up by taxes).

Roberto_gas

Colonel Claptrap wrote:

But if we have to choose between loosening lending restrictions or keeping rents high, I choose the latter. It's far less risky for the individuals, banks and taxpayer. Not ideal but unfortunately it's the reality we face.

Income going into high rentals is not a good thing for economy...neither is high purchase prices and higher deposits....its a dangerous spiral in which ultimately savings are going into housing...never a good sign...

Bob24

Roberto_gas wrote: »

Income going into high rentals is not a good thing for economy...

I think most people will agree it’s not good (at least I do). But as Colonel Claptrap was saying and as we have seen in this country only 10 years ago, excessive lending is even worse.

The_Conductor

Bob24 wrote: »

I think most people will agree it’s not good (at least I do). But as Colonel Claptrap was saying and as we have seen in this country only 10 years ago, excessive lending is even worse.

The level of private indebtedness in Ireland (to say nothing of our public sector debt)- is in absolute terms- the highest per head of population in Europe- and the third highest in the world.

The only thing keeping the show on the road- for the last decade- has been historically unprecedented interest rates.

If you want a real scare- read the minutes from the last ECB meeting- and the comments from both doves and hawks- regarding 'it is now time to implement normalization of interest rates'.

We already have a rapid unwinding of the ECB's QE programme- it is a simple question- when, not if, interest rates are going to start ratcheting upwards.

Irish lending institutions have, of late, been making a concerted effort to convince consumers to buy fixed rate products to try and insulate them from the vagaries of the market- when the day of reckoning does come. The government itself- is recognising this with its lifetime mortgage interest rate offer (at sovereign rates).

The Irish market is not the only market to have had bubble pricing as a result of the fiscally loose policies of the last decade- we are, however, unique in having such a large pool of both public and private sector debt at floating interest rates.

The NTMA has to refinance over 85 billion of public sector debt within the next 4 years- something that is not being spoken of- everyone seems to be drunk of the exuberance of an expansionary budget policy for the first time in years..........

We have a world of hurt on the horizon in both the public and private sectors- and anyone who tries to warn people is getting fun poked at them- the old chestnut about a broken clock being right twice a day is the euphemism that is most regularly being rolled out to greet these warnings.

We need to exercise severe caution and prudence in both the public and private sectors. Instead- we seem intent on throwing caution to the wind.

Bubbaclaus

Do people think demand will fall in the near future due to people being unable to save a deposit in the first place due to high rents?

Once this current blockage is cleared we could go through a phase of low demand due to a large chunk of the age group expecting to buy not being able to save the required 10%.

Bob24

Bubbaclaus wrote: »

Do people think demand will fall in the near future due to people being unable to save a deposit in the first place due to high rents?

Once this current blockage is cleared we could go through a phase of low demand due to a large chunk of the age group expecting to buy not being able to save the required 10%.

Bar an economic shock, I don’t think demand will fall as such. But the max budget of buyers will stop increasing at such a fast pace and hopefully prices will settle.

While rents are kind of spiralling out of control, there are still many people in a position to save money.

The Student

The Student wrote: »

Why not extend the rent a room relief to landlords. Rents under €1k no tax anything above tax on all of it. The landlord is no worse off, the tenant pays less rent and therefore can save for a deposit.

Its a win win for both!

Buy to lets would than be incredibly attractive for folks with cash as an investment.

When I was a landlord I paid little to no tax as the mortgage interest & other expenses were significant compared to the rent which was low at the time.

Your suggestion would benefit those with money who invest in by to let property more than renters imo

Samuel T. Cogley

The additional problem of extending RAR to apartments is you'd curtail the number of rooms available for rent. People like me would stop renting a room and just focus on an apartment. You only need look at the threads here where people are thinking of doing RAR and want to put in separate kitchens and entrances.

Well if you rented out the whole thing and not just a room presumably there'd be at least an extra room out there

If it's your primary residence you'd hardly rent it all out anyway, if it isn't and your doing the rar thing then that's a different chat that's off topic and irrelevant.

Samuel T. Cogley

Augeo wrote: »

Well if you rented out the whole thing and not just a room presumably there'd be at least an extra room out there

If it's your primary residence you'd hardly rent it all out anyway, if it isn't and your doing the rar thing then that's a different chat that's off topic and irrelevant.

I currently rent a room in my PPR and an apartment. If the allowance was moved to the apartment I'd use that allowance for the apartment. A room at €550 per month would be removed from the market and an apartment at €14K a year would replace it, doing the exact opposite of what needs to happen.

It's neither off topic nor irrelevant since RAR is a massive subset of people that would be forced into apartments.

RAR is it's own thing and should remain as such. That's not to say that there aren't tax based incentives that would work.

I don't think many folk rent out an apartment & a room in the ppr.

The overall impact of what you are describing is close to SFA TBH, as you well know.

At 14k/year the mentioned tax relief wouldn't apply to your apartment BTW.

Also...no one is suggesting eliminating rar thing....just extending it to full lets that are under 1000/month.

Samuel T. Cogley

Augeo wrote: »

I don't think many folk rent out an apartment & a room in the ppr.

The overall impact of what you are describing is close to SFA TBH, as you well know.

At 14k/year the mentioned tax relief wouldn't apply to your apartment BTW.

14K is the current RAR relief. You're clearly not entirely sure what you're talking about and are missing the point. RAR's in PPR's are a lower cost along with a potential additional rental stream for certain Landlords.

The Student

The Student wrote: »

Why not extend the rent a room relief to landlords. Rents under €1k no tax anything above tax on all of it. The landlord is no worse off, the tenant pays less rent and therefore can save for a deposit.

Its a win win for both!

I'm talking about what's up there ....

Samuel T. Cogley wrote: »

14K is the current RAR relief. You're clearly not entirely sure what you're talking about and are missing the point. RAR's in PPR's are a lower cost along with a potential additional rental stream for certain Landlords.

Samuel T. Cogley

Augeo wrote: »

I'm talking about what's up there ....

Certainly seems to be coming from up there.

keane2097

Are ye talking about a landlord getting relief for RAR in their own house or just giving landlords 14k allowance for their lettings?

Samuel T. Cogley

Samuel T. Cogley wrote: »

Certainly seems to be coming from up there.

Oh....I expected better from you.
Ah well.

The Student

keane2097 wrote: »

Are ye talking about a landlord getting relief for RAR in their own house or just giving landlords 14k allowance for their lettings?

On the whole property. The tenant then pays less rent then they are currently paying and can save a deposit for their own house while renting.

keane2097

The Student wrote: »

On the whole property. The tenant then pays less rent then they are currently paying and can save a deposit for their own house while renting.

Sounds incredibly expensive!

keane2097

keane2097 wrote: »

Sounds incredibly expensive!

A pocket liner for the wealthy paid for by the taxpayer.
I suppose those potentially benefiting pay and have paid and would pay plenty tax though.

The Student

keane2097 wrote: »

Sounds incredibly expensive!

To who? Would you prefer people are forced to rent indefinitely as they can't afford to rent and save for a deposit

Bob24

The Student wrote: »

To who? Would you prefer people are forced to rent indefinitely as they can't afford to rent and save for a deposit

Given the extremely tense rental market we have, most rents in a place like Dublin are set by high demand v.s. limited offer, not by running costs for landlords*.

So I doubt a massive tax cut for landlords would make it cheaper for tenants. It would in large part simply make it more profitable to be a landlord* (very few people on this thread if any could honestly say that if they were landlords and getting a tax cut, they would reduce rents accordingly even if the market allowed for higher rents). There is an argument that making it more profitable would bring more properties onto the market, but I personally doubt it would be a significant number compared to the cost of giving all landlords that tax break*.

As always, the issue simply is that in Dublin and some other places the stock of homes is simply not sufficient to cater for the population. Anything except building more homes is just talks and won't improve the situation.

* by saying these things I am not saying landlords have it easy or that taxation for individual landlords is not somewhat unfair, just stating the market situation and what I think the effect of the suggested measure would be given that situation.

zl1whqvjs75cdy

Anyone else see the indos front page this morning. 18 months until celtic tiger peaks are reached. Levels of ****ty journalism reaching incredible new heights.

The_Conductor

donkeyoaty0099 wrote: »

Anyone else see the indos front page this morning. 18 months until celtic tiger peaks are reached. Levels of ****ty journalism reaching incredible new heights.

If there was ever a clarion call to sell- that is it..........

Zenify

The_Conductor wrote: »

If there was ever a clarion call to sell- that is it..........

Seems to be a lot of articles going around at the moment. My mortgage broker rang me the other day encouraging me to buy too. I've had a rolling approval for over a year with him and never got a call before.