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Dublin - Significant reduction in rents coming?

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Comments

  • Registered Users Posts: 267 ✭✭ overkill602


    Metro north 2030


  • Closed Accounts Posts: 436 ✭✭ eleventh


    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.
    Tenants almost always stay a minimum of 2 years or that's their intention when looking. Finding people to stay exactly 12 months -or any fixed term- could be difficult, and especially if there's a choice of places with no fixed term.


  • Registered Users Posts: 9,234 ✭✭✭ Caranica


    eleventh wrote: »
    Tenants almost always stay a minimum of 2 years or that's their intention when looking. Finding people to stay exactly 12 months -or any fixed term- could be difficult, and especially if there's a choice of places with no fixed term.

    After 6 months they're entitled to 6 years inclusive, under Part IV rights. So no point in 1 or 2 year leases, tenants can't sign away their legal rights.


  • Registered Users Posts: 5,368 ✭✭✭ JimmyVik


    Metro north 2030


    Remember Tranport21 :)


  • Registered Users Posts: 37,293 ✭✭✭✭ the_syco


    Ozark707 wrote: »
    Quite a number of examples here of places with multiple drops.

    https://thepropertypin.com/c/the-irish-property-bubble/rental-price-drops
    Having a look at these.

    https://www.daft.ie/22013481
    €2,500 Per month
    THIS PROPERTY IS PART OF A GUESTHOUSE AND IS ONLY AVAILABLE DURING APRIL FOR THE CURRENT PRICE. IT WILL BE AVAILABLE FOR FUTURE BOOKING DATES ON BOOKING.COM.

    https://www.daft.ie/22014713
    €2,350 Per month

    https://www.daft.ie/quaysidequarter
    From €2,430 per month

    A 50% drop may seem good, but not when it's €2,500 after said drop.


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


    the_syco wrote: »
    I say most of them will be looking to sell up, as I doubt the AirBnB hosts will come back to a market where you currently can't evict people.

    I expect that very much depends on what way property prices move over the next few weeks/months.


  • Closed Accounts Posts: 436 ✭✭ eleventh


    Caranica wrote: »
    After 6 months they're entitled to 6 years inclusive, under Part IV rights. So no point in 1 or 2 year leases, tenants can't sign away their legal rights.
    He's probably aware of part IV.

    There's nothing wrong with an agreement for a fixed term provided both agree to it. It can often suit students for example. But no students now (and wrong time of year), that's what I was getting at.


  • Registered Users Posts: 5,368 ✭✭✭ JimmyVik


    eleventh wrote: »
    He's probably aware of part IV.

    There's nothing wrong with an agreement for a fixed term provided both agree to it. It can often suit students for example. But no students now (and wrong time of year), that's what I was getting at.




    A lot of student giving up properties they would even keep over the summer for the following year. Now they are just giving them up completely. So ordinarily those guys would not be in the market come the end of summer because they would already be sorted with accommodation. Now they and all the other students who are normally looking will be back in September / October all looking for accommodation at the same time. Its going to be a bloodbath.


  • Closed Accounts Posts: 436 ✭✭ eleventh


    JimmyVik wrote:
    ....Now they and all the other students who are normally looking will be back in September / October all looking for accommodation at the same time. Its going to be a bloodbath.
    I wouldn't even bank on students returning. Reality is we can't predict the timing of what's ahead. Colleges could remain shut, or courses moved online.

    If students do return in Sept/Oct, ex-AirBnbs can then offer their 12 month agreements.


  • Registered Users Posts: 5,368 ✭✭✭ JimmyVik


    eleventh wrote: »
    I wouldn't even bank on students returning. Reality is we can't predict the timing of what's ahead. Colleges could remain shut, or courses moved online.

    If students do return in Sept/Oct, ex-AirBnbs can then offer their 12 month agreements.


    Eventually even if the virus doesnt go away people (and govenrments) will just sat f*ck it, cant live life locked up forever. Need to get back out, make money, live life, take my chances with the virus. Anything is better than being locked up.


    Not saying I know for sure, but I think this I think is likely to happen.


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  • Registered Users Posts: 5,655 ✭✭✭ Claw Hammer


    eleventh wrote: »
    He's probably aware of part IV.

    There's nothing wrong with an agreement for a fixed term provided both agree to it. It can often suit students for example. But no students now (and wrong time of year), that's what I was getting at.

    If it is for over 6 months, Part 4 kicks in no matter what was agreed at the start.


  • Registered Users Posts: 19,223 ✭✭✭✭ Muahahaha


    Just on the Airbnb thing (and this is just anecdotal) but from work Im aware of one operator who has somewhere around 40 different units in Dublin to let to tourists. He owns none of them, the way it works is he approaches landlords and offers a 3,4 or 5 year lease at below market rates. The lease also puts full responsibility on him for repairs.

    The problem he has now is he is locked into these long leases and theres no tourists for the foreseeable. The other problem is he now has to deal with 40+ individual property owners and try to somehow convince them to reduce the rent or offer some forebearance. On top of that the only way out is to get those properties let ASAP because the rents are still due.

    There is quite a lot of Airbnb operators in Dublin using a similar model. iirc an Airbnb report said one operator has over 100 units. People in that position are going to struggle because they need rent to pay their own leases otherwise they are going to have a lot of property owners suing them for non-performance of the lease. But the rent they get wont match their Airbnb revenues so the profit gets swallowed up very quickly.


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


    AirBnB arbitrage, a spectacularly uncomfortable business model to be operating in the current environment.


  • Registered Users Posts: 11,668 ✭✭✭✭ Dav010


    Graham wrote: »
    AirBnB arbitrage, a spectacularly uncomfortable business model to be operating in the current environment.

    Graham, do you think a guy who has been operating 40 Airbnb units owned by different owners, illegally, is going to continue to pay rent when there are no tourists? I doubt he/she is feeling the least bit uncomfortable.

    For those banging on about how the LA are going to clamp down on Airbnb’s, this is another example of how unlikely that is. In the case described above, none of the property owners are advertising their properties for STLs, so cannot be prosecuted.


  • Closed Accounts Posts: 436 ✭✭ eleventh


    If it is for over 6 months, Part 4 kicks in no matter what was agreed at the start.
    You're repeating the same point from the post I replied to.

    What I said does not contradict part 4. There's nothing to stop people having their own agreement (and taking the risk that goes with it) if they want to do that.


  • Registered Users Posts: 13,746 ✭✭✭✭ partyjungle


    Muahahaha wrote: »
    Just on the Airbnb thing (and this is just anecdotal) but from work Im aware of one operator who has somewhere around 40 different units in Dublin to let to tourists. He owns none of them, the way it works is he approaches landlords and offers a 3,4 or 5 year lease at below market rates. The lease also puts full responsibility on him for repairs.

    The problem he has now is he is locked into these long leases and theres no tourists for the foreseeable. The other problem is he now has to deal with 40+ individual property owners and try to somehow convince them to reduce the rent or offer some forebearance. On top of that the only way out is to get those properties let ASAP because the rents are still due.

    There is quite a lot of Airbnb operators in Dublin using a similar model. iirc an Airbnb report said one operator has over 100 units. People in that position are going to struggle because they need rent to pay their own leases otherwise they are going to have a lot of property owners suing them for non-performance of the lease. But the rent they get wont match their Airbnb revenues so the profit gets swallowed up very quickly.

    Finally some good news


  • Registered Users Posts: 3,181 ✭✭✭ snotboogie


    JimmyVik wrote: »
    I think they will do everything in their power not to hit the tax payer this time.
    I really thing that all capital spending for the next few years will be reined right in.
    So much so that any government sponsored housing will not be built for a few years. You may see the ones already started being finished at a trickle, but you wont see any big projects that were due to be started in the next year or two getting going.
    That and roads etc will just crawl. The national BB plan will be put on ice. Id say the childrens hospital will keep going.
    We are in for a huge cut in any form of government spending. There will be no social welfare christmas bonus or increases. No pension increases. No childrens allowance increases.

    Im all over the place here, but what I mean is that government spending will just die for a few years.

    Not looking like that at the moment. Ireland is borrowing for next to nothing right now, which is the huge difference to 2009. If we continue to see low borrowing costs, capital spending will be seen as a way to restart the economy. Large scale public housing building is looking more likely now than it was pre covid.


  • Registered Users Posts: 5,943 ✭✭✭ handlemaster


    snotboogie wrote: »
    Not looking like that at the moment. Ireland is borrowing for next to nothing right now, which is the huge difference to 2009. If we continue to see low borrowing costs, capital spending will be seen as a way to restart the economy. Large scale public housing building is looking more likely now than it was pre covid.

    Large renewable energy projects. Bring down the cost of electricity for the state and businesses thus this would bring in more tax and fund other projects.


  • Registered Users Posts: 1,157 ✭✭✭ The Student


    snotboogie wrote: »
    Not looking like that at the moment. Ireland is borrowing for next to nothing right now, which is the huge difference to 2009. If we continue to see low borrowing costs, capital spending will be seen as a way to restart the economy. Large scale public housing building is looking more likely now than it was pre covid.

    Not sure this will happen. Building houses will not generate enough economic activity to generate income tax receipts. I would expect tax breaks to encourage consumption and thereby generating VAT and income tax receipts. It will without doubt be very interesting to see what happens.


  • Registered Users Posts: 3,181 ✭✭✭ snotboogie


    Not sure this will happen. Building houses will not generate enough economic activity to generate income tax receipts. I would expect tax breaks to encourage consumption and thereby generating VAT and income tax receipts. It will without doubt be very interesting to see what happens.

    Yes, the only thing is that we have a huge backlog in infrastructure anyway, probably the worst in Western Europe. Now would be a good time to build without overheating the economy


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  • Registered Users Posts: 1,157 ✭✭✭ The Student


    snotboogie wrote: »
    Yes, the only thing is that we have a huge backlog in infrastructure anyway, probably the worst in Western Europe. Now would be a good time to build without overheating the economy

    We have to repay what we are currently borrowing for covid. Borrowing further to fund long term projects will not help us repay what we owe. We need income tax receipt to go towards paying down the extra debt we now have from covid.


  • Registered Users Posts: 2,000 ✭✭✭ Hubertj


    We have to repay what we are currently borrowing for covid. Borrowing further to fund long term projects will not help us repay what we owe. We need income tax receipt to go towards paying down the extra debt we now have from covid.

    i read on the weekend - https://www.rte.ie/news/business/2020/0401/1127866-governments-covid-19-costs-could-hit-30-billion-kbc/ - that Ireland could borrow the guts of €30bn and it "only" adds about €150m a year in interest payments.


  • Registered Users Posts: 1,157 ✭✭✭ The Student


    Hubertj wrote: »
    i read on the weekend - https://www.rte.ie/news/business/2020/0401/1127866-governments-covid-19-costs-could-hit-30-billion-kbc/ - that Ireland could borrow the guts of €30bn and it "only" adds about €150m a year in interest payments.

    Its not the interest payments that is the concern its the capital repayments. We don't know what covid is going to cost us without wanting to use money for capital projects. We will be in a recession after this and the first priority is to create employment to generate tax receipts.


  • Registered Users Posts: 2,000 ✭✭✭ Hubertj


    Its not the interest payments that is the concern its the capital repayments. We don't know what covid is going to cost us without wanting to use money for capital projects. We will be in a recession after this and the first priority is to create employment to generate tax receipts.


    Agreed but is it possible some, or a lot, of the shorter term bonds will be refinanced to kick the can further down the road a number of years until the economy gets back on a surer footing?


  • Registered Users Posts: 1,157 ✭✭✭ The Student


    Hubertj wrote: »
    Agreed but is it possible some, or a lot, of the shorter term bonds will be refinanced to kick the can further down the road a number of years until the economy gets back on a surer footing?

    Yes but only if we can show in the short term we can repay our borrowings hence the need for employment and income tax receipts.

    This is my view we can only speculate until we see how this plays out.


  • Registered Users Posts: 152 ✭✭ JamesMason


    Muahahaha wrote: »
    Just on the Airbnb thing (and this is just anecdotal) but from work Im aware of one operator who has somewhere around 40 different units in Dublin to let to tourists. He owns none of them, the way it works is he approaches landlords and offers a 3,4 or 5 year lease at below market rates. The lease also puts full responsibility on him for repairs.

    The problem he has now is he is locked into these long leases and theres no tourists for the foreseeable. The other problem is he now has to deal with 40+ individual property owners and try to somehow convince them to reduce the rent or offer some forebearance. On top of that the only way out is to get those properties let ASAP because the rents are still due.

    There is quite a lot of Airbnb operators in Dublin using a similar model. iirc an Airbnb report said one operator has over 100 units. People in that position are going to struggle because they need rent to pay their own leases otherwise they are going to have a lot of property owners suing them for non-performance of the lease. But the rent they get wont match their Airbnb revenues so the profit gets swallowed up very quickly.
    Good luck with that. Karma


  • Registered Users Posts: 2,006 ✭✭✭ Sunny Disposition


    I didn’t vote SF in the last election, but when I see the stories about AirBNB I have a small bit of regret. FG and FF will do anything but interfere in property or business to help the average working person. A clear out is definitely needed.
    People are now paying over €2,000 a month just to RENT an average property. That’s a crazy situation, but the outgoing Government let it happen.
    Have a lot of issues with SF but the country needs a turn to the left, this laissez faire approach to housing failed very badly.


  • Registered Users Posts: 3,181 ✭✭✭ snotboogie


    We have to repay what we are currently borrowing for covid. Borrowing further to fund long term projects will not help us repay what we owe. We need income tax receipt to go towards paying down the extra debt we now have from covid.

    It's a lot more complicated than that. You can't tax your way out of a depression. In theory, long term projects would help us repay the principal. Counter cyclical investment is how an economy should be run, spending on useful long term infrastructure in a recession to inject money into the economy while saving on the projects that would need to be done anyway and running budget surpluses in the boom times to build credibility, save money and avoid overheating the economy.


  • Registered Users Posts: 11,668 ✭✭✭✭ Dav010


    I didn’t vote SF in the last election, but when I see the stories about AirBNB I have a small bit of regret. FG and FF will do anything but interfere in property or business to help the average working person. A clear out is definitely needed.
    People are now paying over €2,000 a month just to RENT an average property. That’s a crazy situation, but the outgoing Government let it happen.
    Have a lot of issues with SF but the country needs a turn to the left, this laissez faire approach to housing failed very badly.

    Crikey, do you not think RPZs, 4% rent caps and a RTB which is biased toward tenants is “interference”? I really don’t get why you think STLs are the root of all evil, they account for a minuscule proportion of all wholly rented units. Why would you not be directing your ire towards LA planning laws, cost of building, institutional investors buying huge swathes of existing/new developments? Do you really think SF is going to build 50k houses per year? When asked during the election where the 40billion they were going to need to deliver on their election promises when only 20billion was in the state coffers, Pierce couldn’t answer.

    I would think LLs would be more inclined to lower rents now if they weren’t going to be locked into a rent cap on the new rate.


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  • Registered Users Posts: 2,006 ✭✭✭ Sunny Disposition


    Dav010 wrote: »
    Crikey, do you not think RPZs, 4% rent caps and a RTB which is biased toward tenants is “interference”? I really don’t get why you think STLs are the root of all evil, they account for a minuscule proportion of all wholly rented units. Why would you not be directing your ire towards LA planning laws, cost of building, institutional investors buying huge swathes of existing/new developments? Do you really think SF is going to build 50k houses per year? When asked during the election where the 40billion they were going to need to deliver on their election promises when only 20billion was in the state coffers, Pierce couldn’t answer.

    I would think LLs would be more inclined to lower rents now if they weren’t going to be locked into a rent cap on the new rate.

    Token efforts were made, which failed utterly. Average rents are too high. It’s unacceptable and people are going to elect politicians who they think at least care about the problem, as they should.

    I’m a landlord myself, but the proverbial dog with mallet in its arse can see that the current market is dysfunctional and completely disastrous for average workers.


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