HAP scheme - pros and cons for a landlord?

FelaniaMump · 25-03-2019 9:25pm

Sure, the're "suing". That's definitely a true thing that happened, for sure.

GGTrek · 25-03-2019 11:53pm

Esme Uptight Matting wrote: »

Well aren't you just great &#55357;&#56900;

Yes I usually am with lazy gits:D

tvjunki · 26-03-2019 5:30pm

Fol20 wrote: »

Id say a lot of people are paying rent privately are jealous of paying 10pc on rent. Id say for a lot of renters they are paying 40-50pc on rent alone

Everyone paying income tax are paying to provide HAP scheme so people can rent at a very reduced rate. Those that have the money and are just under the threshold will take up a scheme like this even if they could manage before.

What about the ones paying 40-50pc of their income in a mortgage? They are told to manage.

Old diesel · 26-03-2019 5:53pm

tvjunki wrote: »

Fol20 wrote: »

Id say a lot of people are paying rent privately are jealous of paying 10pc on rent. Id say for a lot of renters they are paying 40-50pc on rent alone

Everyone paying income tax are paying to provide HAP scheme so people can rent at a very reduced rate. Those that have the money and are just under the threshold will take up a scheme like this even if they could manage before.

What about the ones paying 40-50pc of their income in a mortgage? They are told to manage.

What does "could manage before" actually look like though.

For me it means someone struggling to make ends meet.

Regardless of HAPs flaws - that isn't a great way to build a viable sustainable society.

Old diesel · 26-03-2019 5:53pm

tvjunki wrote: »

Fol20 wrote: »

Id say a lot of people are paying rent privately are jealous of paying 10pc on rent. Id say for a lot of renters they are paying 40-50pc on rent alone

Everyone paying income tax are paying to provide HAP scheme so people can rent at a very reduced rate. Those that have the money and are just under the threshold will take up a scheme like this even if they could manage before.

What about the ones paying 40-50pc of their income in a mortgage? They are told to manage.

What does "could manage before" actually look like though.

For me it means someone struggling to make ends meet.

Regardless of HAPs flaws - that isn't a great way to build a viable sustainable society.

FelaniaMump · 27-03-2019 11:33am

It's not 10%, thats only for those whose only income is SW. Most HAP tenants pay the max contribution as most of them are working.

KiloDelta · 08-01-2020 8:52pm

Hi all,

This week I have become a Landlord unintentionally. Just a change in circumstances etc etc.

We rented our place out to a person receiving HAP.

Today I received an email from the Local Authority to say that on the 13th of this month I would receive €XXXX.

This figure I am to receive is 3 times the agreed rent.

I assume one is the deposit (Tenant said our deposit would be paid on 13th) and one is the January rent - but can't figure why there would be a third paid already. The website says payments are not until the last Wednesday of the month.

Any ideas? Thanks

emeldc · 08-01-2020 9:40pm

KiloDelta wrote: »

Hi all,

This week I have become a Landlord unintentionally. Just a change in circumstances etc etc.

We rented our place out to a person receiving HAP.

Today I received an email from the Local Authority to say that on the 13th of this month I would receive €XXXX.

This figure I am to receive is 3 times the agreed rent.

I assume one is the deposit (Tenant said our deposit would be paid on 13th) and one is the January rent - but can't figure why there would be a third paid already. The website says payments are not until the last Wednesday of the month.

Any ideas? Thanks

Unless the rules have changed the rent is paid in arrears, hence the last wed in the month. They don’t pay a deposit or at least they didn’t. Why didn’t you ask the tenant for a deposit assuming they’re already in. Were you that stuck for a tenant that you chose someone on SW or without a full time job. If they have paid you 3 months rent in advance, good for you I say. Although I doubt it.

circular flexing · 08-01-2020 9:44pm

emeldc wrote: »

Unless the rules have changed the rent is paid in arrears, hence the last wed in the month. They don’t pay a deposit or at least they didn’t. Why didn’t you ask the tenant for a deposit assuming they’re already in. Were you that stuck for a tenant that you chose someone on SW or without a full time job. If they have paid you 3 months rent in advance, good for you I say. Although I doubt it.

Actually if you are classified as homeless in Dublin city, the council will pay deposit and 2 months rent in advance

http://hap.ie/homeless-hap/

circular flexing · 08-01-2020 9:45pm

KiloDelta wrote: »

Hi all,

This week I have become a Landlord unintentionally. Just a change in circumstances etc etc.

We rented our place out to a person receiving HAP.

Today I received an email from the Local Authority to say that on the 13th of this month I would receive €XXXX.

This figure I am to receive is 3 times the agreed rent.

I assume one is the deposit (Tenant said our deposit would be paid on 13th) and one is the January rent - but can't figure why there would be a third paid already. The website says payments are not until the last Wednesday of the month.

Any ideas? Thanks

I would call the HAP payments section in Limerick and find out - usually they are good on the phone.

the_syco · 08-01-2020 10:06pm

circular flexing wrote: »

Actually if you are classified as homeless in Dublin city, the council will pay deposit and 2 months rent in advance

http://hap.ie/homeless-hap/

I think they started to do this to balance out the way the rent is paid in arrears, so that although it'd be paid in arrears, it'd appear before the rent is due at the start of the month.

Monokne · 08-01-2020 10:08pm

KiloDelta wrote: »

Hi all,

This week I have become a Landlord unintentionally. Just a change in circumstances etc etc.

We rented our place out to a person receiving HAP.

Today I received an email from the Local Authority to say that on the 13th of this month I would receive €XXXX.

This figure I am to receive is 3 times the agreed rent.

I assume one is the deposit (Tenant said our deposit would be paid on 13th) and one is the January rent - but can't figure why there would be a third paid already. The website says payments are not until the last Wednesday of the month.

Any ideas? Thanks

Deposit and 2 months rent I think. Pretty sure that's what I got at first. But then you won't be getting another payment for like 2 months.

Saudades · 08-01-2020 10:24pm

KiloDelta wrote: »

Hi all,

This week I have become a Landlord unintentionally. Just a change in circumstances etc etc.

We rented our place out to a person receiving HAP.

Today I received an email from the Local Authority to say that on the 13th of this month I would receive €XXXX.

This figure I am to receive is 3 times the agreed rent.

I assume one is the deposit (Tenant said our deposit would be paid on 13th) and one is the January rent - but can't figure why there would be a third paid already. The website says payments are not until the last Wednesday of the month.

Any ideas? Thanks

Yes it sounds like your tenant applied for Homeless HAP as opposed to the regular HAP scheme.

"Deposit and two months’ rent upfront available for homeless households only."

PrettyBoy · 08-01-2020 10:46pm

Have two rental properties that I rent out myself (no letting agent or management company) so I meet potential tenants myself and have had to show the house to some HAP recipients at viewings. I would never consider letting a property out to someone that's not paying the rent themselves and is relying on a council to do it for them.

There's no benefit to having a HAP recipient as a tenant over an employed person that's paying their own way. Some misguided people bang on about not having to worry about non-payment because the council is guaranteeing payment - absolute bollocks. The council pay only when they receive the money from the tenant and, surprisingly, sometimes the people receiving free money can be a bit lax and contrary when the time comes to pay for things. The council won't do a thing to help you when it happens and you'll be left to deal with a long, expensive and stressful ordeal.

Months/years of over-holding, mounting rent arrears and legal costs and then the costs to repair the inevitably destroyed property. It's an absolute minefield for landlords, playing Russian Roulette with a major asset like a house/apartment. In this market it's entirely possible to get a tenant that works full-time, understands the value of money and respects other peoples property.

Saudades · 08-01-2020 11:04pm

PrettyBoy wrote: »

There's no benefit to having a HAP recipient as a tenant over an employed person that's paying their own way.

Landlords who rent to tenants in receipt of social housing supports like HAP may avail of increased tax relief - allowing property owners to claim 100% relief on their mortgage interest, as an expense against rental income.

http://hap.ie/landlords/whyhap/

circular flexing · 08-01-2020 11:40pm

PrettyBoy wrote: »

Have two rental properties that I rent out myself (no letting agent or management company) so I meet potential tenants myself and have had to show the house to some HAP recipients at viewings. I would never consider letting a property out to someone that's not paying the rent themselves and is relying on a council to do it for them.

There's no benefit to having a HAP recipient as a tenant over an employed person that's paying their own way. Some misguided people bang on about not having to worry about non-payment because the council is guaranteeing payment - absolute bollocks. The council pay only when they receive the money from the tenant and, surprisingly, sometimes the people receiving free money can be a bit lax and contrary when the time comes to pay for things. The council won't do a thing to help you when it happens and you'll be left to deal with a long, expensive and stressful ordeal.

Months/years of over-holding, mounting rent arrears and legal costs and then the costs to repair the inevitably destroyed property. It's an absolute minefield for landlords, playing Russian Roulette with a major asset like a house/apartment. In this market it's entirely possible to get a tenant that works full-time, understands the value of money and respects other peoples property.

Yes because no employed person has ever thrashed a house ever. :rolleyes:

Renting out a house is a risk not matter who you rent to, maybe renting to HAP is riskier. I would say the sheer volume of people getting HAP means they can't all be bad, which btw includes many working people now. I had HAP tenants for a couple of year and it was fine. House was left in good condition and they left of their own accord.

PrettyBoy · 09-01-2020 12:05am

circular flexing wrote: »

Yes because no employed person has ever thrashed a house ever. :rolleyes:

Not saying that at all. I completely agree that there is a risk no matter who you let live in your house, but there are ways to mitigate that risk, and taking on people that are paying with their own way is one of them. Taking on HAP tenants is a massive gamble, and far less likely to pay off than going with someone that's paying their own rent in full. I know some people in receipt of HAP are working but in my experience (in general, not just with tenants) is that people that pay for their own things with money they've earned generally respect them. People that have things given to them for free (or very close to it) very often don't.

tvjunki · 09-01-2020 11:55am

Saudades wrote: »

Landlords who rent to tenants in receipt of social housing supports like HAP may avail of increased tax relief - allowing property owners to claim 100% relief on their mortgage interest, as an expense against rental income.

http://hap.ie/landlords/whyhap/

The 100% relief on mortgage interest applies to all lettings now.

KiloDelta · 09-01-2020 4:28pm

emeldc wrote: »

Unless the rules have changed the rent is paid in arrears, hence the last wed in the month. They don’t pay a deposit or at least they didn’t. Why didn’t you ask the tenant for a deposit assuming they’re already in. Were you that stuck for a tenant that you chose someone on SW or without a full time job. If they have paid you 3 months rent in advance, good for you I say. Although I doubt it.

Thank you all for your replies. Some good information being given.

I did ask for a deposit from Jan 1st when the tenancy started but the tenant asked if we could wait until Jan 13th as this is when HAP would pay it for her, so that is the reason for that.

I personally know a relation to the tenant and felt that this particular tenant would not screw us over - but like the points have been raised above - full employment or SW recipient - nothing guarantees payment or good care of the home. A person on €75k p.a could lose their job tomorrow and be a SW recipient themselves.

For the likes of purchasing an expense such as kettle, toaster, painting, bathroom etc etc - is all of the cost written off against your tax liability on the income?

Eg - tax on the rental income €7000pa

Washing machine bought @ €300

New liability €6700????

Excuse my naivety!

Saudades · 09-01-2020 5:43pm

Fair play and my total respect to you for accepting homeless HAP tenants.
It appears that a lot of landlords reject HAP applicants as they either don't understand what it is, or they think it's associated with social welfareites on the dole, or they don't want the hassle of the extra few sheets of A4 paperwork.

circular flexing · 09-01-2020 5:47pm

KiloDelta wrote: »

Thank you all for your replies. Some good information being given.

I did ask for a deposit from Jan 1st when the tenancy started but the tenant asked if we could wait until Jan 13th as this is when HAP would pay it for her, so that is the reason for that.

I personally know a relation to the tenant and felt that this particular tenant would not screw us over - but like the points have been raised above - full employment or SW recipient - nothing guarantees payment or good care of the home. A person on €75k p.a could lose their job tomorrow and be a SW recipient themselves.

For the likes of purchasing an expense such as kettle, toaster, painting, bathroom etc etc - is all of the cost written off against your tax liability on the income?

Eg - tax on the rental income €7000pa

Washing machine bought @ €300

New liability €6700????

Excuse my naivety!

Revenue have a guide for what can and cannot be written off as an expense

https://www.revenue.ie/en/property/rental-income/irish-rental-income/what-expenses-are-allowed.aspx

In the case of white goods, you can write the cost of them off over 8 years.

Old diesel · 09-01-2020 6:12pm

Saudades wrote: »

Fair play and my total respect to you for accepting homeless HAP tenants.
It appears that a lot of landlords reject HAP applicants as they either don't understand what it is, or they think it's associated with social welfareites on the dole, or they don't want the hassle of the extra few sheets of A4 paperwork.

There is also concern that HAP inspections re standards are more strict then if you were letting to a non HAP tenant.

But I don't think anyone has ever fully got to the bottom of the issue.

People have had the inspector demand big work to be done like drilling holes in every room for ventilation.

What isnt clear is what the same inspector would do different if non HAP.

Because up to now most reported inspections are HAP.

If a landlord thinks he could be asked to spend 30 grand on work the Landlord thinks isnt necessary and cant afford anyway.

Then he will try and avoid HAP.

Could be as simple as he simply not having the cash for 30 k of unnecessary (to him) work.

And then the people in charge of the wider HAP system are a pain. So if the Tenant stops paying their share then it gets messy.

Especially as you get paid by HAP in arrears - so January's rent is at the end of January rather then at start of month.

More work is needed to make HAP more friendly to landlords. Should be scope to deliver a better financial business offer to Landlords taking up HAP and STILL be cheaper then putting the tenant and their family up in a hotel.

the_syco · 09-01-2020 9:00pm

Saudades wrote: »

or they don't want the hassle of the extra few sheets of A4 paperwork.

Your building must confirm to the standards of HAP. Said standards are not published. No-one knows what they are. No-one knows if their building is up to scratch. So if you take HAP, you may have to spend a few thousand to bring it up to whatever standard happens to be happening at that time. Failure to do so gets the LL a fine. Once the LL lets the HAP tenant in, I can't see any way that the LL can get rid of them should the house fail the inspection whereby the LL does not get a fine.

The LL won't make the money they spend back, as HAP is usually under market rate.

tvjunki · 09-01-2020 11:05pm

KiloDelta wrote: »

Thank you all for your replies. Some good information being given.

I did ask for a deposit from Jan 1st when the tenancy started but the tenant asked if we could wait until Jan 13th as this is when HAP would pay it for her, so that is the reason for that.

I personally know a relation to the tenant and felt that this particular tenant would not screw us over - but like the points have been raised above - full employment or SW recipient - nothing guarantees payment or good care of the home. A person on €75k p.a could lose their job tomorrow and be a SW recipient themselves.

For the likes of purchasing an expense such as kettle, toaster, painting, bathroom etc etc - is all of the cost written off against your tax liability on the income?

Eg - tax on the rental income €7000pa

Washing machine bought @ €300

New liability €6700????

Excuse my naivety!

Pre letting expenses are not allowed. Keep those costs and receipts to when you sell the house and offset against sale. E.g refurbishment painting. What you buy things or do maintenance they can be used to reduce your tax bill.
Do not put in kettles toasters as they will not last long and the tenant should have them anyway. Years ago you had to provide cutlery,plates and the likes but not anymore.
Have a look at the rtb site to see what you need to provide.

Pay for an accountant to do your first tax bill so you do not mess up. Maybe meet one now so you know what your allowed to reduce your tax bill.
Washing machine fridge you write of over 8 years not just written off in the first year.

You may know a tenant though a friend but they can go rogue. As soon as the tenant is late sent 14days notice and then 30day notice of termination for non payment of rent. You can give a tenant notice within the first 6months for no reason so any late or non payment would be a warning for future.

When the tenant moves in make sure you take the utlities off your name and moved into theirs. Make sure the tenant knows the cannot put in a key meter for energy as they are costly to remove. Gas board charged me 220to remove when the gas board put it in for non payment of the gas bill and I knew nothing about it until she left.

Maybe put up a post on an advice for a new landlord....many will say don't do it. New Legislation is coming down the line so definately do your research.

emeldc · 09-01-2020 11:52pm

Gas board charged me 220to remove when the gas board put it in for non payment of the gas bill and I knew nothing about it until she left.

Prepay power tried to charge me for the removal of a meter that a tenant put in. I asked them for a copy of the letter that I gave them allowing permission for it to be fitted in the first place. They removed it then no problem

Irish_peppa · 10-01-2020 10:03am

I did this once not sure the exact name of scheme i own my own house and was renting to a guy who lost his job, I suggested he go to SW office and ask about rental allowance. It worked out as roughly 75% of what he paid me allready the SW would pay the the bulk he would make up the balance.
In any event filled out all forms, all good . weeks passed and no sign of money at all. Each week i would ask have you heard from SW, nope they are so slow. After 2 months . Yes im a fool for letting it go so long i was told there would be a back payment if any rent due after documents submitted so i didnt really mind.
Getting frustrated unbeknown to the lodger i rang the SW office. he had been collecting the cheques himself or whatever way he was getting the payment. I immediatly told him to leave. so that soured me slightly to such schemes. PS this was about 10 years ago so procedures might have changed by now

Old diesel · 10-01-2020 10:29am

the_syco wrote: »

Your building must confirm to the standards of HAP. Said standards are not published. No-one knows what they are. No-one knows if their building is up to scratch. So if you take HAP, you may have to spend a few thousand to bring it up to whatever standard happens to be happening at that time. Failure to do so gets the LL a fine. Once the LL lets the HAP tenant in, I can't see any way that the LL can get rid of them should the house fail the inspection whereby the LL does not get a fine.

The LL won't make the money they spend back, as HAP is usually under market rate.

If HAP stop the payment over "failure to fix the issues that failed HAP inspection".

Can you not terminate for non payment of rent......

If the HAP tenant somehow keeps paying then no reason to get rid of them right?????

the_syco · 10-01-2020 8:20pm

Old diesel wrote: »

If HAP stop the payment over "failure to fix the issues that failed HAP inspection".

Can you not terminate for non payment of rent......

If the HAP tenant somehow keeps paying then no reason to get rid of them right?????

By "keeps paying", do you mean the percentage that they pay the CC, or the full 100% of the rent? If the latter, great.

If HAP payment stops & the tenant is unable to pay you, you can start the eviction proceedings. As the tenant may not have anywhere to go, you'll need to go down the route of the 14 days notice, followed by the 28 days notice, and if the tenant decides not to go, you'll need to start the PTRB eviction process.

tvjunki · 10-01-2020 8:52pm

emeldc wrote: »

Prepay power tried to charge me for the removal of a meter that a tenant put in. I asked them for a copy of the letter that I gave them allowing permission for it to be fitted in the first place. They removed it then no problem

There was a guy here that have me advice in regards to prepay power as he used to work for them. Said the same as you. I had no contract with prepay so want their property out of mine. I did not have to pay. The same with electric ireland. Bord Gas do charge.
Prepay damaged the walls on removal of the box and just cut cables to the box.

By the way both instances the tenants were on Rent Allowance and we're not given permission to install.
Never had this issue with private tenants.

Old diesel · 10-01-2020 11:42pm

the_syco wrote: »

By "keeps paying", do you mean the percentage that they pay the CC, or the full 100% of the rent? If the latter, great.

If HAP payment stops & the tenant is unable to pay you, you can start the eviction proceedings. As the tenant may not have anywhere to go, you'll need to go down the route of the 14 days notice, followed by the 28 days notice, and if the tenant decides not to go, you'll need to start the PTRB eviction process.

I meant full rent.

Clearly if they only pay "pay part rent" then they are building up arrears.

And if they are simply paying the council then they are paying the landlord nothing so it's pretty much a not paying rent situation.

HAP scheme - pros and cons for a landlord?

Comments