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The Irish rental market needs more regulation

  • 18-05-2020 3:26pm
    #1
    Registered Users Posts: 27,430 ✭✭✭✭ steddyeddy


    If the corona pandemic has highlighted on thing it's that the Irish rental market has some serious problems. In an article from the Independent, Amy Molloy reveals that the some Irish landlords have repeatedly flouted the tenancy laws, with one landlord owing 44k due to repeatedly unlawful ending of tenancies.

    More than 30 private landlords have had 10 or more cases taken against them by different tenants for issues such as withholding deposits, unlawful evictions and poor living conditions, Independent.ie can reveal.

    An analysis of disputes lodged with the Residential Tenancies Board (RTB) over the past six years shows how a cohort of landlords continue to rent despite consistently breaching tenancy laws, with some not paying money owed to renters after the RTB found against them.

    A Co Monaghan landlord has been ordered by the RTB to pay more than €44,000 to a number of tenants for unlawfully ending tenancies and keeping security deposits.

    On the Commercial side of things we're seeing the closure of Bewley's, a business entity which sees over 600,000 customers pass through their doors. The closure of a business affects all of the other businesses around it through loss of custom.

    More recently Nick's coffee company in Ranelagh, Dublin has been closed by a local landlord responsible for closing several businesses in the area.


    I know people will say that being late with rent is a problem for landlords too but where's the priority here? A landlord that misses out on some payment, in part due to an epidemic or a business like Bewley's which sees up to 600,000 a year pass through its doors.

    It seems the case that a commercial landlord might avoid a loss but the economy takes a much bigger hit in the process. Is this sustainable? What's more important, that businesses stay open or that landlords are protected from loss?


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Comments

  • Closed Accounts Posts: 161 ✭✭ LeYouth


    Landlords are greedy by nature. Asking 1600 for a one bed shack (and it is a 19th century shack) in the middle of Dublin. Sorry it's just overpriced. I don't care what anyone says about market conditions.


  • Closed Accounts Posts: 904 Blaze420


    LeYouth wrote: »
    Landlords are greedy by nature. Asking 1600 for a one bed shack in the middle of Dublin. Sorry it's just overpriced. I don't care what anyone says about market conditions.

    No they aren’t, commercial landlords perhaps but the domestic landlord is vilified for no reason (and no I’m not a landlord but I am renting). What do you expect them to do? If a house is going for 1600 in the area they own property should they just be good souls and price it at 1000? That’s not how it works and that’s not how any supply/demand market works.


  • Registered Users Posts: 9,477 ✭✭✭ runawaybishop


    It's enforcement that is needed, not more regulation. No point having regulations if you can just ignore them and get away with it.


  • Registered Users Posts: 14,122 ✭✭✭✭ Donald Trump


    LeYouth wrote: »
    Landlords are greedy by nature. Asking 1600 for a one bed shack (and it is a 19th century shack) in the middle of Dublin. Sorry it's just overpriced. I don't care what anyone says about market conditions.




    You would be more than welcome to purchase said shack, or similar, and make an example by renting it out for 600 per month instead.



    Why don't you do it? You might even get it a bit cheaper now with uncertainty over corona


  • Registered Users Posts: 27,430 ✭✭✭✭ steddyeddy


    Blaze420 wrote: »
    No they aren’t, commercial landlords perhaps but the domestic landlord is vilified for no reason (and no I’m not a landlord but I am renting). What do you expect them to do? If a house is going for 1600 in the area they own property should they just be good souls and price it at 1000? That’s not how it works and that’s not how any supply/demand market works.

    I'm referring to the behaviour of landlords acting irresponsibly regarding the law. Some of the cases were detailed in the article I linked to.

    More than 30 private landlords have had 10 or more cases taken against them by different tenants for issues such as withholding deposits, unlawful evictions and poor living conditions, Independent.ie can reveal.
    An analysis of disputes lodged with the Residential Tenancies Board (RTB) over the past six years shows how a cohort of landlords continue to rent despite consistently breaching tenancy laws, with some not paying money owed to renters after the RTB found against them.

    A Co Monaghan landlord has been ordered by the RTB to pay more than €44,000 to a number of tenants for unlawfully ending tenancies and keeping security deposits.


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  • Registered Users Posts: 9,477 ✭✭✭ runawaybishop


    LeYouth wrote: »
    Landlords are greedy by nature. Asking 1600 for a one bed shack (and it is a 19th century shack) in the middle of Dublin. Sorry it's just overpriced. I don't care what anyone says about market conditions.

    All businesses are greedy by nature, they don't get set up to lose money.

    You could easily say any tenant that rents a one bed shack for 1600 is thick.


  • Closed Accounts Posts: 904 Blaze420


    steddyeddy wrote: »
    I'm referring to the behaviour of landlords acting irresponsibly regarding the law. Some of the cases were detailed in the article I linked to.

    More than 30 private landlords have had 10 or more cases taken against them by different tenants for issues such as withholding deposits, unlawful evictions and poor living conditions, Independent.ie can reveal.

    Just to play the devils advocate - what did those people do to the property to deserve a withholding of deposits or being ****ed out of the house? Soundbites only paint a picture of poor tenants being at the mercy of a moustache twirling landlord - the reality is they are probably scum who had an eviction a long time coming


  • Registered Users Posts: 27,430 ✭✭✭✭ steddyeddy


    Blaze420 wrote: »
    Just to play the devils advocate - what did those people do to the property to deserve a withholding of deposits or being ****ed out of the house? Soundbites only paint a picture of poor tenants being at the mercy of a moustache twirling landlord - the reality is they are probably scum who had an eviction a long time coming

    Actually the court ruled in their favour so I doubt the scum hypothesis. I worked in UCD's student accommodation sector. I've seen countless times were the landlord behaved unlawfully.


  • Closed Accounts Posts: 904 Blaze420


    steddyeddy wrote: »
    Actually the court ruled in their favour so I doubt the scum hypothesis. I worked in UCD's student accommodation sector. I've seen countless times were the landlord behaved unlawfully.

    One case out of X? That’s hardly representative.


  • Registered Users Posts: 26,407 ✭✭✭✭ Eric Cartman


    LeYouth wrote: »
    Landlords are greedy by nature. Asking 1600 for a one bed shack (and it is a 19th century shack) in the middle of Dublin. Sorry it's just overpriced. I don't care what anyone says about market conditions.

    heres the easiest way to calculate landlord greed, find a property to rent, find out how much that property was sold for , do a mortgage calculation and then double the monthly mortgage payment, thats the minimum amount a landlord can charge to break even in this country.

    you'll soon find that many of them are just about breaking even and in a lot of cases losing money on the rent.


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  • Registered Users Posts: 14,122 ✭✭✭✭ Donald Trump


    heres the easiest way to calculate landlord greed, find a property to rent, find out how much that property was sold for , do a mortgage calculation and then double the monthly mortgage payment, thats the minimum amount a landlord can charge to break even in this country.

    you'll soon find that many of them are just about breaking even and in a lot of cases losing money on the rent.




    That's completely wrong.


  • Registered Users Posts: 26,407 ✭✭✭✭ Eric Cartman


    Blaze420 wrote: »
    Just to play the devils advocate - what did those people do to the property to deserve a withholding of deposits or being ****ed out of the house? Soundbites only paint a picture of poor tenants being at the mercy of a moustache twirling landlord - the reality is they are probably scum who had an eviction a long time coming

    not sure id call them all 'scum' but the issue of tenant overholding, damage and misrepresentation (putting properties on Airbnb without landlords approval, converting apartments into bunk bed jungles etc...) is way more prevalent than tenants being thrown out the door.

    and its always the same "why didn't you pay your rent for 8 months" "the heating was broken for a week last year and there was a bit of mould in the bathroom we kept the window shut in"


  • Registered Users Posts: 26,407 ✭✭✭✭ Eric Cartman


    That's completely wrong.

    its not an exact figure but considering the mortgage is paid after tax (interest relief only goes so far) , its a good rule of thumb to say 2x mortgage payment to break even.


  • Registered Users Posts: 27,430 ✭✭✭✭ steddyeddy


    Blaze420 wrote: »
    One case out of X? That’s hardly representative.

    I'm referring to the cases in the article. One landlord was ordered to pay ~ 44k. That's hardly one tenant.
    A Co Monaghan landlord has been ordered by the RTB to pay more than €44,000 to a number of tenants for unlawfully ending tenancies and keeping security deposits.


  • Registered Users Posts: 14,122 ✭✭✭✭ Donald Trump


    its not an exact figure but considering the mortgage is paid after tax (interest relief only goes so far) , its a good rule of thumb to say 2x mortgage payment to break even.




    No.


    You break even if you cover the cost of your capital (i.e. the interest cost)


  • Registered Users Posts: 27,430 ✭✭✭✭ steddyeddy


    its not an exact figure but considering the mortgage is paid after tax (interest relief only goes so far) , its a good rule of thumb to say 2x mortgage payment to break even.

    But Eric a mortgage is effectively a loan repayment at the end of which they get an asset. It's not all bad.


  • Registered Users Posts: 27,430 ✭✭✭✭ steddyeddy


    No.


    You break even if you cover the cost of your capital (i.e. the interest cost)

    Exactly DT. I'm amazed at the amount of landlords that don't understand business expenses.


  • Registered Users Posts: 26,407 ✭✭✭✭ Eric Cartman


    No.


    You break even if you cover the cost of your capital (i.e. the interest cost)

    and maintenance, and empty periods etc.. rental properties are supposed to be a good investment and cover their own mortgage payment. this "you'll own it in 30 years so charge a pittance in rent for it" crap doesn't wash.


  • Registered Users Posts: 604 ✭✭✭ SmithySeller


    LeYouth wrote: »
    Landlords are greedy by nature. Asking 1600 for a one bed shack (and it is a 19th century shack) in the middle of Dublin. Sorry it's just overpriced. I don't care what anyone says about market conditions.

    Is that 1600 not subject to full tax, i.e. 52%odd depending on Landlord? So the landlord only gets 768, no? Just wondering...

    Sorry, should have read page 2 (-:


  • Registered Users Posts: 26,407 ✭✭✭✭ Eric Cartman


    Is that 1600 not subject to full tax, i.e. 52%odd depending on Landlord? So the landlord only gets 768, no? Just wondering...

    and of that the mortgage is probably 700 quid so he gets 68 quid a month, what an absolute scrooge...


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  • Registered Users Posts: 604 ✭✭✭ SmithySeller


    Jeece the Government really are scr3wing the Tenants so...


  • Registered Users Posts: 27,430 ✭✭✭✭ steddyeddy


    Jeece the Government really are scr3wing the Tenants so...

    You're assuming a LL would lower their prices with a tax reduction.


  • Registered Users Posts: 2,198 ✭✭✭ sk8board


    steddyeddy wrote: »
    If the corona pandemic has highlighted on thing it's that the Irish rental market has some serious problems. In an article from the Independent, Amy Molloy reveals that the some Irish landlords have repeatedly flouted the tenancy laws, with one landlord owing 44k due to repeatedly unlawful ending of tenancies.




    On the Commercial side of things we're seeing the closure of Bewley's, a business entity which sees over 600,000 customers pass through their doors. The closure of a business affects all of the other businesses around it through loss of custom.

    More recently Nick's coffee company in Ranelagh, Dublin has been closed by a local landlord responsible for closing several businesses in the area.


    I know people will say that being late with rent is a problem for landlords too but where's the priority here? A landlord that misses out on some payment, in part due to an epidemic or a business like Bewley's which sees up to 600,000 a year pass through its doors.

    It seems the case that a commercial landlord might avoid a loss but the economy takes a much bigger hit in the process. Is this sustainable? What's more important, that businesses stay open or that landlords are protected from loss?

    30 landlords from 170,0000, or perhaps thats 30 commercial LL's?
    either way, the irish market is dependent on amateur LL's to provide social housing and private rentals.

    You could try to professionalise the market, by allowing LL's with 3-4+ properties to establish a company and be beholden to stricter rules (getting around the tax burden issue too), as would the tenant of course, and drive out the amateur/accidental LL's, however that cohort is currently 120,000 from the 170,000 total residential LL's according to the RTB (LL's wiht one rental, and all their risk carried by just one tenancy), and no matter how many times people argue that LL's are greedy profiteering gougers, the stats from the RTB shows that 12-15,000 of them left the market last year alone, and only 1 in 5 of those sales were sold on to another LL.

    There are bad LL's, but LL's in general aren't the problem - right now they're the only solution keeping the social housing market together


  • Registered Users Posts: 14,122 ✭✭✭✭ Donald Trump


    and maintenance, and empty periods etc.. rental properties are supposed to be a good investment and cover their own mortgage payment. this "you'll own it in 30 years so charge a pittance in rent for it" crap doesn't wash.




    Nobody said any of that.



    I always see this guff about landlords saying they are making a loss if their after-tax rent doesn't cover all their mortgage repayments.



    That's even ignoring capital appreciaetion. If you purchase property, let it sit there and do nothing with it, and it increases in value over time at a rate faster than the interest rate, and suppose that you are even allowed to capitalize the interest into the outstanding amount, then you make money with ZERO rental income.


  • Registered Users Posts: 26,407 ✭✭✭✭ Eric Cartman


    steddyeddy wrote: »
    You're assuming a LL would lower their prices with a tax reduction.

    probably not, the HAP threshold keeps an artificial floor in the rental market to keep rents above that to keep them away.

    if you allowed landlords deny hap tenants and lowered the taxes and allowed an expidited 90 day legal eviction a lot more people would buy BTL's and see them as a good investment, increasing supply which would decrease rents.

    at the moment its a high cost, low return industry that only the very dedicated or incredibly long term planners enter knowing that mortgage has to be done and dusted before it actually makes returns. Sadly even those people are put off as you can't just give it to your kids, they've to re-mortgage and continue with the same hardship due to inheritance tax.


  • Registered Users Posts: 19,802 ✭✭✭✭ suicide_circus


    if the government owned all property, it could just allocate housing based on need. It could also control all factories, farms and transport.


  • Registered Users Posts: 2,198 ✭✭✭ sk8board


    if the government owned all property, it could just allocate housing based on need. It could also control all factories, farms and transport.

    theres a word for that. can't quite lay my finger on it ........ :D


  • Registered Users Posts: 26,407 ✭✭✭✭ Eric Cartman


    if the government owned all property, it could just allocate housing based on need. It could also control all factories, farms and transport.

    I can't think of anything more horrific.


  • Registered Users Posts: 27,430 ✭✭✭✭ steddyeddy


    probably not, the HAP threshold keeps an artificial floor in the rental market to keep rents above that to keep them away.

    if you allowed landlords deny hap tenants and lowered the taxes and allowed an expidited 90 day legal eviction a lot more people would buy BTL's and see them as a good investment, increasing supply which would decrease rents.

    at the moment its a high cost, low return industry that only the very dedicated or incredibly long term planners enter knowing that mortgage has to be done and dusted before it actually makes returns. Sadly even those people are put off as you can't just give it to your kids, they've to re-mortgage and continue with the same hardship due to inheritance tax.

    You're describing any home owner with the bit in bold.

    The landlord has the extra benefit of using rental of his asset to pay for the loans to cover that asset. If they're accidental landlords then they're fortunate to be able to use an asset to assist them financially.

    Don't forget that being a landlord in renting an asset out to A) make a profit or B) pay off an asset. It's not exactly being hard done by.


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  • Registered Users Posts: 26,407 ✭✭✭✭ Eric Cartman


    steddyeddy wrote: »
    You're describing any home owner with the bit in bold.

    The landlord has the extra benefit of using rental of his asset to pay for the loans to cover that asset. If they're accidental landlords then they're fortunate to be able to use an asset to assist them financially.

    Don't forget that being a landlord in renting an asset out to A) make a profit or B) pay off an asset. It's not exactly being hard done by.

    Exactly, so it has to cover the cost of itself including the mortgage payments to break even, thus when you lump the obscene tax on top, rent usually has to be around 2x the mortgage payment to break even in the short term, hence my original point, landlords aren't all scrooge mcduck sitting on piles of cash screwing over tenants like the original post suggested.


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