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Dublin - Significant reduction in rents coming?

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  • Moderators, Education Moderators, Technology & Internet Moderators Posts: 34,593 Mod ✭✭✭✭ AlmightyCushion


    https://www.hospitalityireland.com/hotel/dalata-ceo-expects-covid-19-related-restrictions-last-september-94385
    McCann said that he believes that 2020 is the year to "make you survive", 2021 will be about beginning to "build back the business" and 2022 will likely be the year when "some levels of normality" are regained "in terms of visitor traffic and numbers".

    The CEO of Dalata Hotel Group said that he expected it would be 2022 before some levels of normality come back. If that is the case then you would imagine it would be the same for short term lets over the next 2 years as well.


  • Registered Users Posts: 11,681 ✭✭✭✭ Dav010


    Graham wrote: »
    I suspect many AirBnB hosts are the same.

    I'd guess many of those haven't cancelled yet as the extenuating circumstances cancellation policy only applies to stays up to May 31st (for now).

    I don't envy any hosts dependant on a handful of bookings 6 months from now, most couldn't survive as evidenced by the sudden rush back to long-term rentals.

    Horses for courses. We’ll know in 6 months.


  • Registered Users Posts: 11,681 ✭✭✭✭ Dav010


    Ozark707 wrote: »
    Even if they do it is unlikely to massively change the supply/demand dynamic...if the place for sale ends up being bought as an investment then no net change, if it purchased by someone who was renting then it is one less place to rent but also one less person looking to rent.

    Do you think there are a lot of investors buying one off properties for rental?


  • Registered Users Posts: 709 ✭✭✭ Ozark707


    Dav010 wrote: »
    Do you think there are a lot of investors buying one off properties for rental?

    If an avalanche of them come on the market then the sale price will plummet thereby making them more attractive to one off investors (even though rents are dropping).

    I doubt anyone will buy to leave them empty so wherever they ultimately end up will not massively change the dynamic.


  • Registered Users Posts: 2,077 ✭✭✭ Blut2


    If I owned an airbnb/STL property I would 100% be looking to get tenants in on a 12 month contract right now. The tourist market might bounce back somewhat by August this year. But its likely to be destroyed again in October/November for 6 months when Corona comes back for the winter. You're looking at at most 2~ months of probably nowhere near normal summer occupancy, and then possibly nothing else until April/May 2021.

    At least with tenants on a 12 month contract theres guaranteed income coming in every month. And the property would free up again just in time for summer 2021, if the tourism market is swinging back to normal by then.


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  • Registered Users Posts: 9,246 ✭✭✭ Caranica


    Blut2 wrote: »
    .
    At least with tenants on a 12 month contract theres guaranteed income coming in every month. And the property would free up again just in time for summer 2021, if the tourism market is swinging back to normal by then.

    Nope. The property would not be free as the tenants would have Part IV rights entitling them to live there for 5 more years with limited termination options.


  • Registered Users Posts: 11,681 ✭✭✭✭ Dav010


    Ozark707 wrote: »
    If an avalanche of them come on the market then the sale price will plummet thereby making them more attractive to one off investors (even though rents are dropping).

    I doubt anyone will buy to leave them empty so wherever they ultimately end up will not massively change the dynamic.

    That’s a lot of assumptions.

    You understand, that at a time when rents were at a historic high, lots of LLs were selling?


  • Moderators, Society & Culture Moderators Posts: 17,643 Mod ✭✭✭✭ Graham


    Caranica wrote: »
    Nope. The property would not be free as the tenants would have Part IV rights entitling them to live there for 5 more years with limited termination options.

    absent many realistic or palatable alternatives, I suspect that's the most likely scenario for most previous STL properties.


  • Registered Users Posts: 11,681 ✭✭✭✭ Dav010


    Blut2 wrote: »
    If I owned an airbnb/STL property I would 100% be looking to get tenants in on a 12 month contract right now. The tourist market might bounce back somewhat by August this year. But its likely to be destroyed again in October/November for 6 months when Corona comes back for the winter. You're looking at at most 2~ months of probably nowhere near normal summer occupancy, and then possibly nothing else until April/May 2021.

    At least with tenants on a 12 month contract theres guaranteed income coming in every month. And the property would free up again just in time for summer 2021, if the tourism market is swinging back to normal by then.

    Free up again in time for the summer? Do you know how difficult it could be to get your property back for the summer market?


  • Moderators, Society & Culture Moderators Posts: 17,643 Mod ✭✭✭✭ Graham


    Dav010 wrote: »
    You understand, that at a time when rents were at a historic high, lots of LLs were selling?

    Property prices were also doing well which made that decision easier at the time.


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  • Registered Users Posts: 2,077 ✭✭✭ Blut2


    Dav010 wrote: »
    Free up again in time for the summer? Do you know how difficult it could be to get your property back for the summer market?

    Rather less difficult than trying to maintain any sort of tourist occupancy rates for the next 12 months I'd imagine.

    My family has rented out properties where I told any prospective incoming tenants the property would be changing use in 12/18/X months, and I would be expecting them to leave then. The tenants in every case were thankful for the advanced notice, planned around it because they had plenty of time to, and moved out on the forewarned date no problem.

    The vast majority of tenants are reasonable adults, if you treat them that way they'll treat you the same.


  • Posts: 18,752 ✭✭✭✭ [Deleted User]


    Dav010 wrote: »
    I have an Airbnb house that I am just going to wait it out with, and put it up on Airbnb again when things open again later in the year. If rents are falling, the benefits of Airbnb will be even more obvious.

    There won't be any airbnb market this year, maybe towards the end if next year.
    Travel & holidays will be very different for the next 18 months at least.
    Good for you if you can leave it empty


  • Registered Users Posts: 11,681 ✭✭✭✭ Dav010


    Blut2 wrote: »
    Rather less difficult than trying to maintain any sort of tourist occupancy rates for the next 12 months I’d imagine.

    Evicting a tenant can take up to a year, and you can only terminate a Part 4 tenancy under certain circumstances. So you would be wrong, I would prefer a property to be empty than spend a year and thousands of Euro evicting a tenant. I would suspect there is a heightened risk of rents not being paid at the moment, and we are going to have to see what way payment of the rolled up rents during the freeze work out, so evictions could go up in the latter half of the year.


  • Registered Users Posts: 26,285 ✭✭✭✭ Eric Cartman


    surely if we only allow 4% increases we should be only allowing 4% reductions.

    or are laws only ok when landlords get shafted ?


  • Registered Users Posts: 11,681 ✭✭✭✭ Dav010


    surely if we only allow 4% increases we should be only allowing 4% reductions.

    or are laws only ok when landlords get shafted ?

    No votes in that one I’d say Eric.


  • Registered Users Posts: 6,193 ✭✭✭ saabsaab


    I'd say the sale prices will take a knock as people get out. Most of these will be bought by people taking the opportunity to get a place in town. This won't result in a reduction in rent (no increases either) for a while.


  • Registered Users Posts: 709 ✭✭✭ Ozark707


    Dav010 wrote: »
    You understand, that at a time when rents were at a historic high, lots of LLs were selling?

    I do and a colleague was one of them. Interestingly he sold to some who had been renting.


  • Registered Users Posts: 11,681 ✭✭✭✭ Dav010


    Ozark707 wrote: »
    I do and a colleague was one of them. Interestingly he sold to some who had been renting.

    Best result possible.


  • Registered Users Posts: 2,077 ✭✭✭ Blut2


    Dav010 wrote: »
    Evicting a tenant can take up to a year, and you can only terminate a Part 4 tenancy under certain circumstances. So you would be wrong, I would prefer a property to be empty than spend a year and thousands of Euro evicting a tenant. I would suspect there is a heightened risk of rents not being paid at the moment, and we are going to have to see what way payment of the rolled up rents during the freeze work out, so evictions could go up in the latter half of the year.

    To quote myself, since you apparently didn't read the full post:
    Blut2 wrote: »
    Rather less difficult than trying to maintain any sort of tourist occupancy rates for the next 12 months I'd imagine.

    My family has rented out properties where I told any prospective incoming tenants the property would be changing use in 12/18/X months, and I would be expecting them to leave then. The tenants in every case were thankful for the advanced notice, planned around it because they had plenty of time to, and moved out on the forewarned date no problem.

    The vast majority of tenants are reasonable adults, if you treat them that way they'll treat you the same.

    You wouldn't need to go through an eviction process at all if you simply treated your tenants decently and were honest from the outset.


  • Registered Users Posts: 11,681 ✭✭✭✭ Dav010


    Blut2 wrote: »
    To quote myself, since you apparently didn't read the full post:



    You wouldn't need to go through an eviction process at all if you simply treated your tenants decently and were honest from the outset.

    I did read your post, my reply covered the unintended consequence of a tenant refusing to leave at the end of the term. Most errant tenants look, and sound, like good tenants the day the lease is signed. Lots of posters on here treated their tenants decently, then recount the nightmare when they stop paying rent and/or refuse to leave when they are supposed to.

    You might expect them to leave, legally though, they can tell you to take a hike.


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  • Registered Users Posts: 929 ✭✭✭ DubCount


    Blut2 wrote: »
    You wouldn't need to go through an eviction process at all if you simply treated your tenants decently and were honest from the outset.

    Sorry, but that's just not true. There are lots of decent landlords who treated their tenants well, and were rewarded with a non-paying / antisocial / overholding tenants that they had to evict.


  • Registered Users Posts: 2,077 ✭✭✭ Blut2


    Dav010 wrote: »
    I did read your post, my reply covered the unintended consequence of a tenant refusing to leave at the end of the term. Most errant tenants look, and sound, like good tenants the day the lease is signed. Lots of posters on here treated their tenants decently, then recount the nightmare when they stop paying rent and/or refuse to leave when they are supposed to.

    You might expect them to leave, legally though, they can tell you to take a hike.

    Landlords posting here are of course going to post a lot of problem stories about tenants. For the same reason tenants posting here post a lot of problem stories about landlords. Because its a forum where people go to ask advice about accommodation, its going to get the problem/unusual cases - not the mundane everyday ones where everything works out.

    But on both sides the overwhelming majority of both landlords and tenants are reasonable, normal people who aren't out to screw anyone over.

    Letting a property sit idle for the best part of a year, receiving absolutely no income from it, because you're afraid of getting one of the possibly 1% of problem tenants seems insane to me from financial risk/reward point of view. But its your lack of income.
    DubCount wrote: »
    Sorry, but that's just not true. There are lots of decent landlords who treated their tenants well, and were rewarded with a non-paying / antisocial / overholding tenants that they had to evict.

    Statistically its completely true. The vast, vast majority of tenancies in Ireland do not end in problematic, drawn out evictions.


  • Registered Users Posts: 155 ✭✭ dowhatyoulove


    Place beside me is up for rent I noticed on daft this week for exactly the same as our rent - don’t think some landlords are noticing the crisis outside their front doors.

    My brother got given notice as well during the month and they managed to secure another place but I found it odd the landlord gave them notice during a pandemic.


  • Registered Users Posts: 11,681 ✭✭✭✭ Dav010


    Place beside me is up for rent I noticed on daft this week for exactly the same as our rent - don’t think some landlords are noticing the crisis outside their front doors.

    My brother got given notice as well during the month and they managed to secure another place but I found it odd the landlord gave them notice during a pandemic.

    Depends on whether your neighbour finds someone to rent the property. Keep us posted.


  • Registered Users Posts: 1,554 ✭✭✭ WhiteMemento9


    Place beside me is up for rent I noticed on daft this week for exactly the same as our rent - don’t think some landlords are noticing the crisis outside their front doors.

    My brother got given notice as well during the month and they managed to secure another place but I found it odd the landlord gave them notice during a pandemic.

    People putting properties onto the market are going to do so at the current rate in the hopes of snagging someone quickly. It will take a while when things are not shifting for people to start reducing rents to try move them and then like dominoes they will fall.


  • Registered Users Posts: 3,102 ✭✭✭ Mic 1972


    Blut2 wrote: »

    You wouldn't need to go through an eviction process at all if you simply treated your tenants decently and were honest from the outset.


    I don't want to sound smart here but that's delusional, you can treat a tenant as nicely as you can, send Christmas cards and keep it friendly, if they have it in them they will still screw you. From personal experience


  • Closed Accounts Posts: 2,971 ✭✭✭ Assetbacked


    The Daft rental report published on Friday says to expect significant falls in rent due to the extraordinary shock to housing demand. Oddly the report wasn't widely covered by Irish media and the few articles that did cover it did not quote the words "significant", "falls" and "rents".

    https://www.daft.ie/report?fr=touch


  • Registered Users Posts: 11,681 ✭✭✭✭ Dav010


    The Daft rental report published on Friday says to expect significant falls in rent due to the extraordinary shock to housing demand. Oddly the report wasn't widely covered by Irish media and the few articles that did cover it did not quote the words "significant", "falls" and "rents".

    https://www.daft.ie/report?fr=touch

    You are cherry picking a few words from the report.

    “Despite all its complexities, housing is still a case of supply and demand. It is clear that COVID-19 represents a dramatic contraction in demand for owner-occupied properties. Households will be far less likely to enter into a 30-year mortgage contract, for example, if they are unsure what their 3-, 6- and 12-month prospects are for being employed and for what they'll earn. Things may be different for rental properties. Clearly, unemployment will soar - but if government steps in to guarantee incomes and prevent evictions, then there may be far less change in the rental market than on the sales side.”


  • Moderators, Society & Culture Moderators Posts: 17,643 Mod ✭✭✭✭ Graham


    Blut2 wrote: »
    You wouldn't need to go through an eviction process at all if you simply treated your tenants decently and were honest from the outset.

    Regardless of how honest you are with your tenants, the law remains. After 6 months a tenant gains the protection of a Part 4 tenancy and the rights afforded by a Part 4 tenancy.

    This includes the right to continue the tenancy other than for a limited set of circumstances.


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  • Closed Accounts Posts: 22,674 ✭✭✭✭ beauf


    The idea being that people will obey these laws even though you can see most of these have been ignoring them for a couple of years already. That the mechanism for dealing with them PRTB and similar which were so slow and backlogged before the crisis. Are unlikely to be functional for some time, and then even more backlogged and even slower.


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