Dublin - Significant reduction in rents coming?

Smouse156

justfortherecor wrote: »

Limited data to date but for some of the listed REITs that disclose information (e.g. IRES, Hibernia, Kennedy Wilson), on-time rent collections for residential assets have been around 97/98% for April and occupancy levels have remained around 99%, so very little impact so far it seems. Will play out over next few months I'd say if anything does start to become evident.

Kennedy Wilson don’t have anywhere near 99% occupancy! They love empty overpriced apartments. Look at Capital Dock! The Vantage in Leopardstown has 10 units listed. Irish REIT did have very low vacancy but not Kennedy Wilson

Blut2

The Economist a few days ago had an article on the troubles facing NYC recovering from Corona, it had an interesting fact:

According to Enrico Moretti, an economist at the University of California, Berkeley, each of the “knowledge jobs” that make cities like San Francisco or New York so successful supports five service jobs, some high paying—lawyers—some much less so—baristas. If office workers stay at home, the workers who depend on them being in town have no income.

https://www.economist.com/briefing/2020/06/11/covid-19-challenges-new-yorks-future

Presumably a similar ratio would apply in Dublin to our own "knowledge jobs". With so much of Google, Facebook etc WFHing for the forseeable future that bodes ill for a lot of jobs - and renters - in the more central parts of Dublin.

justfortherecor

Smouse156 wrote: »

Kennedy Wilson don’t have anywhere near 99% occupancy! They love empty overpriced apartments. Look at Capital Dock! The Vantage in Leopardstown has 10 units listed. Irish REIT did have very low vacancy but not Kennedy Wilson

98.3% occupancy across its 2,080 Irish residential units as at 31 March according to its last quarterly results. Avg rent per unit of c. $2,300

Smouse156

justfortherecor wrote: »

98.3% occupancy across its 2,080 Irish residential units as at 31 March according to its last quarterly results. Avg rent per unit of c. $2,300

That’s completely wrong! That would suggest that they have 2044/2080 units occupied and only 36 empty! Capital Dock has over 100 empty apartments alone since it opened in 2018 and they own the entire building!

global23214124

The_Conductor wrote: »

Is this from a REIT?

No a regular agency.

JimmyVik

Smouse156 wrote: »

That’s completely wrong! That would suggest that they have 2044/2080 units occupied and only 36 empty! Capital Dock has over 100 empty apartments alone since it opened in 2018 and they own the entire building!

Are they lying to their shareholders?

Smouse156

JimmyVik wrote: »

Are they lying to their shareholders?

Clearly! It happens, companies lie, look at wirecard yesterday! I always questioned the validity of those ridiculous occupancy numbers (99%+) which didn’t seem plausible even in a very strong demand market. There had to be some vacancy period for people leaving, buying houses, maintenance or upgrades etc.

It’s clearly some accounting fudge! Simple as! Capital Dock has over 100 vacant apartments so that’s 5% of their portfolio alone in Dublin. Perhaps because the “lights weren’t turned on” they don’t count these but the REAL vacancy rate is way higher.

justfortherecor

Smouse156 wrote: »

That’s completely wrong! That would suggest that they have 2044/2080 units occupied and only 36 empty! Capital Dock has over 100 empty apartments alone since it opened in 2018 and they own the entire building!

Looked at their Q1 accounts further. Capital Dock is currently categorised outside of the 2,080 units referenced for the purposes of the 98.3% occupancy at 31 March. Still categorised as going through letting stabilisation process, so no occupancy given for the 190 units there just yet.

They own 50% of the development - AXA own other 50%.

JimmyVik

Smouse156 wrote: »

Clearly! It happens, companies lie, look at wirecard yesterday! I always questioned the validity of those ridiculous occupancy numbers (99%+) which didn’t seem plausible even in a very strong demand market. There had to be some vacancy period for people leaving, buying houses, maintenance or upgrades etc.

It’s clearly some accounting fudge! Simple as! Capital Dock has over 100 vacant apartments so that’s 5% of their portfolio alone in Dublin. Perhaps because the “lights weren’t turned on” they don’t count these but the REAL vacancy rate is way higher.

Report them. Serious consequences for them. And then maybe the REITS will fcuk off.

Smouse156

justfortherecor wrote: »

Looked at their Q1 accounts further. Capital Dock is currently categorised outside of the 2,080 units referenced for the purposes of the 98.3% occupancy at 31 March. Still categorised as going through letting stabilisation process, so no occupancy given for the 190 units there just yet.

They own 50% of the development - AXA own other 50%.

Ha stabilisation process my ass! A total fudge! Didn’t realise Axa owner half

Gael23

I left a share house paying €950 in Mid March. Place is still vacant and he’s looking for €790

Rodney Bathgate

Smouse156 wrote: »

Ha stabilisation process my ass! A total fudge! Didn’t realise Axa owner half

You probably shouldn’t make serious accusations when you clearly don’t have the facts to back them up.

Ozark707

Gael23 wrote: »

I left a share house paying €950 in Mid March. Place is still vacant and he’s looking for €790

I know of someone who was struggling to fill a room in an apartment (in city centre) well before Corona struck. I suspect he would have to drop the price markedly to fill now as well. If rooms now have dropped approx 20% you are going to start to see people in house/apt shares move about.

Hubertj

Ozark707 wrote: »

I know of someone who was struggling to fill a room in an apartment (in city centre) well before Corona struck. I suspect he would have to drop the price markedly to fill now as well. If rooms now have dropped approx 20% you are going to start to see people in house/apt shares move about.

I would be a bit wary going into a house share under the current circumstances. Covid is pretty much gone (for now) but I’m sure people would be concerned sharing with strangers

Blut2

Hubertj wrote: »

I would be a bit wary going into a house share under the current circumstances. Covid is pretty much gone (for now) but I’m sure people would be concerned sharing with strangers

If you're moving from one houseshare to another its no difference, though. Most of the people in houseshares currently don't have the option of renting an entire place to themselves for financial reasons.

JJJackal

I suspect re falling rent prices people are still at home (with their parents or in Europe and all college students have left their properties); will be interesting to see what happens when and if these people come back.

TheSheriff

JJJackal wrote: »

I suspect re falling rent prices people are still at home (with their parents or in Europe and all college students have left their properties); will be interesting to see what happens when and if these people come back.

Read on the newspaper today that international post-grad applications where down 10% for next September.

Tbh, I had thought it would have been much, much more!

JJJackal

TheSheriff wrote: »

Read on the newspaper today that international post-grad applications where down 10% for next September.

Tbh, I had thought it would have been much, much more!

10% seems quite small! I agree should be more!

TheSheriff

JJJackal wrote: »

10% seems quite small! I agree should be more!

Possibly still early days tough and i has yet to play out.

I have a good friend who is a lecturer in Dublin and while there was fear re; the international student cohort two months back, it seems to have died down a bit and has been replaced with cautious optimism.

Blut2

TheSheriff wrote: »

Read on the newspaper today that international post-grad applications where down 10% for next September.

Tbh, I had thought it would have been much, much more!

A large % of post-grad courses would have had application deadlines in December 2019, or January/Feb/March of this year, for courses starting in September 2020. So applications probably aren't the best metric to use - a lot of them would have been already made pre-corona.

The real question/enlightening figures will be enrollment numbers come late August.

Hubertj

TheSheriff wrote: »

Read on the newspaper today that international post-grad applications where down 10% for next September.

Tbh, I had thought it would have been much, much more!

I think I read the same article but it also said the INS isn’t reopening until tomorrow. Ther will be a big backlog in processing visa applications.

frw5

Blut2 wrote: »

A large % of post-grad courses would have had application deadlines in December 2019, or January/Feb/March of this year, for courses starting in September 2020. So applications probably aren't the best metric to use - a lot of them would have been already made pre-corona.

The real question/enlightening figures will be enrollment numbers come late August.

Thumbs up here, absolutely correct, I would say 90% actually end up signing up for it officially by that time, a lot can go through and be accepted even in mid September.


PS on topic, can't believe there is still no news on extending rent freeze. At least till September that is.

TheSheriff

Blut2 wrote: »

A large % of post-grad courses would have had application deadlines in December 2019, or January/Feb/March of this year, for courses starting in September 2020. So applications probably aren't the best metric to use - a lot of them would have been already made pre-corona.

The real question/enlightening figures will be enrollment numbers come late August.

Didn't think of that, makes sense we are likely looking at pre-covid sign ups.

One would think the Universities will want to do everything they can to get these students on campus for some level of tutorials/workshops etc.

Donald Trump

TheSheriff wrote: »

Read on the newspaper today that international post-grad applications where down 10% for next September.

Tbh, I had thought it would have been much, much more!

That's probably still enough to fill the same number of spots. (i.e. a slightly lower threshold for acceptance of applications)

GocRh

Donald Trump wrote: »

That's probably still enough to fill the same number of spots. (i.e. a slightly lower threshold for acceptance of applications)

https://www.thejournal.ie/international-students-blow-to-universities-5127324-Jun2020/


“At the moment it’s still very unclear,” said Paul Smith, Director of DCU’s International Office. “If you look at it from a pipeline perspective, we normally have around 2,000 – 2,500 applications for postgraduate courses but obviously the conversion, or people who actually come, is much smaller. At this point, we’re about 10% down on applications… but we’re not clear yet on the intent students have on how to progress.”

Ozark707

GocRh wrote: »

https://www.thejournal.ie/international-students-blow-to-universities-5127324-Jun2020/


“At the moment it’s still very unclear,” said Paul Smith, Director of DCU’s International Office. “If you look at it from a pipeline perspective, we normally have around 2,000 – 2,500 applications for postgraduate courses but obviously the conversion, or people who actually come, is much smaller. At this point, we’re about 10% down on applications… but we’re not clear yet on the intent students have on how to progress.”

It is hard to see how international destinations for academia would have a demand this year. If a second wave was to hit in the autumn would you want to be stuck far away from home with potentially great difficulty getting home?

Blut2

Ozark707 wrote: »

It is hard to see how international destinations for academia would have a demand this year. If a second wave was to hit in the autumn would you want to be stuck far away from home with potentially great difficulty getting home?

Thats not even the biggest issue. Lets say you get a bit of warning so you do manage to get home. You're now sitting at home in your parents house in a different country, having paid €8,000 or so for your student accommodation in Ireland. And you've already paid €15,000-€30,000 per year for your student fees. Neither of which universities are refunding (as is the case this semester).

Sure you might get some sort of "distance learning" maybe, but it'll come nowhere close to the normal level of learning. And you'll get none of the student social experience, teaching practice, or professional networking, that are as valuable a part of any post-grad degree as the actual learning.

It'd be a very confident (or foolish) international student to accept and pay for a post-grad course place this September, when everything is still so up in the air.

polaco

https://www.irishexaminer.com/breakingnews/business/rents-likely-to-fall-5-while-home-prices-steady-after-covid-19-lockdown-1007685.html

Looks like we are going to have some reductions on the housing market

Ozark707

polaco wrote: »

https://www.irishexaminer.com/breakingnews/business/rents-likely-to-fall-5-while-home-prices-steady-after-covid-19-lockdown-1007685.html

Looks like we are going to have some reductions on the housing market

It would look like we are already past 5% since Covid struck on the rental front (Dublin based figures). I would expect next few months to see a further drop and then maybe stabilisation for a while. It will be interesting to see if the new government look for any quick wins on this front as I can see an appetite for a further reduction in rents from them.

https://bl.ocks.org/pinsterdev/raw/234b4a5310a14a32e080/

polaco

Ozark707 wrote: »

It would look like we are already past 5% since Covid struck on the rental front (Dublin based figures). I would expect next few months to see a further drop and then maybe stabilisation for a while. It will be interesting to see if the new government look for any quick wins on this front as I can see an appetite for a further reduction in rents from them.

https://bl.ocks.org/pinsterdev/raw/234b4a5310a14a32e080/

I am guessing when all those people return to offices in September and students return to college demand will go up and there will be no more reductions