Irish Property Market chat II - *read mod note post #1 before posting*

Villa05

That rental tax credit was swallowed up very quickly, although from what I'm hearing most are unable to claim it due to to non registry with PRTB. Ironically they're probably the lucky ones with lower rent

Ireland’s private rental market remains chronically starved of homes, leading to rents in the final quarter of last year an average of 13.7pc higher than the same period a year earlier, the latest Daft.ie report has found.

While there are regional differences, all parts of the country are experiencing substantial year-on-year increases in open market rents.

In the year to December 2022, the rate of inflation in Dublin was 12.6pc, Cork city was 14.9pc, Limerick city was 18.9pc and Waterford city was 20.2pc. Outside the cities, the average annual increase in market rents was 13.6pc.

Villa05

https://www.boards.ie/discussion/comment/120233695#Comment_120233695

One would have hoped that ESB staff were a step above drug dealers.

https://www.boards.ie/discussion/comment/120234756#Comment_120234756

While I agree rents are unsustainable while there is a shortage of properties and competition for rentals rents will remain high unfortunately. Employers pushing employees back into the work place will create more competition in cities again where rents are already very high. I know quite a few that moved out of the city when WFH became a thing to save money, then they were required to come in two days a week the cheaper rent was enough to make the commute bearable but now most have been told to come in 4 to 5 days a week and don't fancy spending 10 to 20 hours a week in a car so are looking for accommodation closer to their workplace again.

The REITs in my area have caused the average rents to increase significantly in the last 4 years. I had a small number of units that I had to leave empty the last two years in order to bring the rents up to the rates REITs are charging. I have two former tenants looking at returning to the city who thought they would find a place for the rent they were paying about 3 years ago but said they are facing a 40%-50% increase for similar properties as before, it would have been more cost effective for them to stay in the city during the WFH period as their rent would have only increased by 6%. Its surprising the number of potential tenants that are trying to negotiate cash deals now.

We have seen large increases again in rents last year. It appears the drive towards making the rental market completely professional is not having the desired effect for renters, landlords that are fixed at low rates are leaving and the ones remaining have the means to get around rent pressure zone rules in order to maximize rents.

wassie

https://www.boards.ie/discussion/comment/120231389#Comment_120231389

Whilst I hope all involved get taken to task, it doesnt come as a complete shock to anyone associated at all with new developments.

The process and timing of electricty connections, along with water, in this country is a basket case. Its a shambolic process that adds considerable delay, cost and uncertainty to a project and was always open to this type of behaviour, especially in the construction industry in this country.

Bass Reeves

https://www.boards.ie/discussion/comment/120235076#Comment_120235076

Saw this last week, Supermacs looking for a water connection at a motorway plaza.

https://m.independent.ie/irish-news/supermacs-threatened-irish-water-twice-over-connection-fees-41341766.html

Previously he stated they wanted 720K.

https://www.irishtimes.com/news/ireland/irish-news/pat-mcdonagh-claims-irish-water-quoted-720-000-to-connect-motorway-plaza-1.4712857

ApeEvolved

https://www.boards.ie/discussion/comment/120234907#Comment_120234907

I have no hard facts on it but just from what I have seen myself...

I have seen very little pushback on work from home by employers, if anything I have noticed more people moving to cheaper Countries while maintaining their wfh.

Im in tech though so maybe its different.

Beigepaint

https://www.boards.ie/discussion/comment/120234907#Comment_120234907

It’s really frustrating to read about landlords leaving properties vacant for two years in order to get around the government’s poorly designed policies.

Thanks for the honesty.

Donald Trump

https://www.boards.ie/discussion/comment/120234907#Comment_120234907

I had a small number of units that I had to leave empty the last two years in order to bring the rents up to the rates REITs are charging.

How can you complain about REITs on one hand, but also have no compunction about going out of your way to match them.

Donald Trump

https://www.boards.ie/discussion/comment/120235137#Comment_120235137

There is a big difference between an arguably overpriced official estimate, and staff using their positions to demand under-the-table personal payments.

Bass Reeves

https://www.boards.ie/discussion/comment/120235177#Comment_120235177

But what can a LL who might have been 50% of the market rent do.

There was a theory that during COVID that people working from home would reduce rental pressure and LL would have to drop prices

Some of us predicted this as a solution for some LL's. Over regulated supply tends always to increase the price of a product as the risk of dropping your price has too much downside.

Regulation is also discouraging LL from renting properties that are short term vacant, as getting the property back is too hard and a single mistake on a notice period can move a property from a short term let to a long term

https://www.boards.ie/discussion/comment/120235177#Comment_120235177

It's unfortunate and its something I'd prefer not to have to do but the RPZ rules have created a massive imbalance in existing rents versus new rents. Rents are increasing at massive rates because landlords need to charge as much as they can at start of a tennancy due to the limitations that the RPZ rules impose.

Operating rentals has become more time consuming/expensive over the last number of years and these costs have to passed onto renters in the form of higher rents.

https://www.boards.ie/discussion/comment/120235189#Comment_120235189

I pointed out that REITs drove the price increases in areas where I have rentals, im only trying to catch up. Once my units are rented out I'm sure it won't be long before I'm stuck at rents below average again for the area. REITs are what people appear to want, REITs are what are driving rental increases.

Rentals are a business, businesses tend to watch each others prices in order to remain viable. I'm small scale you don't expect me to provide the same service as REITs for significantly less?

Donald Trump

https://www.boards.ie/discussion/comment/120235177#Comment_120235177

It really lends the lie to the myth that landlords would not increase rents by much anyway if there were no rent caps. It gives an indication of how those rent caps are actually protecting people if the landlords are chomping at the bit to screw the tenants.

Perhaps the solution, in terms of policy design, might be a 5 year period rather than a 2 year period.

Donald Trump

https://www.boards.ie/discussion/comment/120235339#Comment_120235339

im only trying to catch up

How does what the other person is charging affect the viability of your own operation???????? The vast majority of your outgoings were fixed when you purchased the property.

If you want to reverse your logic, then you would have no issue with being viable if rents crashed to 50% of their current values tomorrow, as long as it also crashed for the REITs

REITs were brought in, and given tax advantages, precisely to bail out existing property owners - particularly landlords

Villa05

https://www.boards.ie/discussion/comment/120235196#Comment_120235196

There isn't really except one is blue collar and the other is white collar. The white collar has captured politics and made there extortion legal while the blue collar attempts remain illegal end up in the High Court making white collared/wigged professionals even wealthier.

Watch the video from Lorcan Sirr posted yesterday. He sums it up perfectly. "The brown envelope has been replaced by lobbying. Lobbying now makes developers very wealthy"

Donald Trump

https://www.boards.ie/discussion/comment/120235426#Comment_120235426

Maddest post of the year I've seen so far.

Lobbying has nothing got to do with ESB workers allegedly abusing their position to extort money out of people for a service they are already being paid to provide

You seriously wouldn't see any difference between a Council introducing an official published development levy of say 50k a house, and the Council planner who decides your application demanding a bag of 50k cash delivered to his house in secret or else you won't get your planning?

timmyntc

https://www.boards.ie/discussion/comment/120235371#Comment_120235371

Your bias is blinding you to the obvious - if the OP ever wanted to sell up, their rent having fallen behind the rest of "the market" would devalue their property too, since the chargeable rent directly impacts the property sale prices.

If all other landlords doubled their prices and you kept yours the same, your house would be worth far less than the rest due to RPZ rules. Rent increases are not just about cashflow but also an attempt to stave off capital depreciation. And lets be honest, if you could keep off capital depreciation like that in any other asset you would.

If there were no RPZ rules this situation wouldn't occur ironically, as a new purchaser could set the rent whatever the market will bear, whereas now its based on your ability to raise to meet RPZ. The RPZ actually promotes the cartel-like rent increasing across the board funny enough.

If they changed it to 5years as you suggest then the rental shortage would get even worse, but REITs would still keep stuff vacant for 5 years. The rents in the meantime would skyrocket, making it worthwhile as an investment to get no rent for 5 years but then set it way higher after the 5.

Donald Trump

https://www.boards.ie/discussion/comment/120235548#Comment_120235548

How much of a discount should a prospective owner occupier expect for a house which was rented before at below market rents? 10%? 20%? 50%? Do you have any links of any current ads with such a discount that proves your theory?

I mean, has it not been already established on the thread that all landlords are trying to exit the market anyway, so it would only be owner occupiers buying?

No need for the victim complex either timmy. Although I like your novel economic thesis that instead of setting the rent at a price the market can bear, RPZs force the have-a-go's to charge more than the market can bear. Which the market can somehow bear.....

timmyntc

https://www.boards.ie/discussion/comment/120235600#Comment_120235600

victim complex?

methinks the lady doth protest too much

Its been covered to death on this thread going back 2 years at least how rental yields influence the capital price of property, RPZ and their influence on rents are no different. They limit the rent achievable (compared to what the market will bear - can be seen by newer entrants to market with higher rents), and by limiting rent the property valuation is limited too.

It has been established that small landlords are tying to exit the market, due to too much red tape and overheads and taxes for such a small yield. Larger players are still fine as have enough property to deal with risk of non-payments and the overheads for multiple rental units do not scale linearly.

Donald Trump

https://www.boards.ie/discussion/comment/120235644#Comment_120235644

Stating the obvious automatically provokes a response of some kind of "bias". Perfect evidence of a victim complex.

Now we have on the thread that not only landlords are victimised because of the "difficulty" in selling after availing of additional easy exemptions to evict a tenant. They are now also being forced to leave their apartments empty for two years instead.

(And of course another post above from another poster implying that landlords want to reduce rents, but are instead being forced to leave their properties empty so that they can increase it)

DublinDweller2023

I have a Question re: Auctioneera if anyone knows regarding this:

Acceptance of Your Offer

Once the deadline for offers closes, we present the top three offers to the vendor. If the vendor decides to accept your offer, you will be asked to make a booking deposit in order to move to sale agreed. Auctioneera takes a booking deposit of €2000. This is fully refundable right up until contracts are signed.

If it appears there is just one other party bidding on a property, why would one continue to outbid? If your offer of say €1000 less is going to be presented anyway?

If you are a 1st time buyer, no chain, and mortgage approved. Do you think it is worth the risk of waiting it out and not continue to outbid one another to drive the price up even more? Or are people aware of this? That even if they have the highest bid it doesn't necessarily guarantee them the property?

TIA

Donald Trump

https://www.boards.ie/discussion/comment/120235697#Comment_120235697

If I was selling a property that you were bidding on, I might be very happy if my buddy sworn enemy kept pushing you up and up to your absolute limit, safe in the knowledge that I can decide not to accept his perfectly legitimate bid in favour of your absolute highest one.

Villa05

https://www.boards.ie/discussion/comment/120235474#Comment_120235474

I'm referring to the developement industry as a whole. The culture within it is to extort the maximum by every means possible. That appears to be having trickle down effect to blue collars.

Donald Trump

https://www.boards.ie/discussion/comment/120235789#Comment_120235789

Yes, that is what the developers do. And what many on here seem to support. Presumably because they have deluded themselves into thinking it will be them some day

What is alleged in the ESB would never have happened in the private sector though. Can you imagine a develop finding out that his staff were skimming like that and turning a blind eye?

https://www.boards.ie/discussion/comment/120235371#Comment_120235371

Haha here we go again. Operate rentals like businesses when it comes to legalisation and taxes but when it comes to charging rent operate rentals like charities. You have an awful chip on your shoulder.

What outgoings were fixed? Insurance costs are up, management fees are up, legal fees are up, cost of repairs are up, interest rates are up, cost of labour is up, property tax and RTB annual registration.

Unless costs come down at the same rate many rentals would not be viable for both private landlords and REITs.

REITs were brought in to stabilise the rental market, the hope was that they would use some of their billions to provide many rental units but instead they have drip fed units to the market to maintain the rental shortage and drive prices up further.

https://www.boards.ie/discussion/comment/120235789#Comment_120235789

You think there is something unusual with a private business maximising profits? I would think it is negligent of them not to.

What the ESB workers were doing on the other hand, is extortion, particularly if their performance of a work order from their employer (ESB) was contingent on the client giving them a cash payoff which their employer knew nothing about.

Donald Trump

https://www.boards.ie/discussion/comment/120235822#Comment_120235822

You'd also want to get rid of the victim mentality - like many of the moaners on here.

You are entitled to charge as much as you can get. But if you also keep putting on the poor mouth and pretending and blaming others for you deciding to raise your prices, then it is fair to point out your inconsistencies to you.

Part of this poor mouth mentality is whinging about rising interest rates. If you made a commercial decision not to fix, then that was your decision. There is not a legitimate expectation for a rise in rates to be passed on to tenants. Not to mention the fundamental concept that if you are paying interest, then it is because you borrowed someone else's capital. You took on risk they did not want to and were compensated with a greater return. But you took that on willingly and can't expect a handout if you encounter a blip in the road.

Selective memory there about the reason for REITs being attracted in btw. I think they call "insisting black is white" as gaslighting these days.

herbalplants

https://www.newstalk.com/news/rents-increase-by-almost-14-amid-chronic-shortage-of-housing-1436700

Hope government will take a hard look at the mess they made with their regulations.

We never had these regulations in the past and the rental market worked. Now it doesn't.

https://www.boards.ie/discussion/comment/120235977#Comment_120235977

Haha pure shite as per usual, Donald states costs associated with rentals are fixed then is provided with eight examples of costs that have increased and only focuses on interest rates.

What poor mouth?

I'm not a victim, I don't blame anybody for having to raise prices. REITs have been beneficial to those that are able to leave units empty for two years, REITs have much more power than me to manipulate the rental market I'm just riding on their coat tails. If left to me I would calculate rent to cover my costs plus what I think is sufficient for the time and investment involved that figure would probably be lower than the figure units are going for in my area. REITs have determined that the value of rental units in the area is higher and I have decided to match that, if they decided the value of rental units was lower I'd probably have to match that too.

https://www.boards.ie/discussion/comment/120235977#Comment_120235977

You can ignore the whinging on this thread and perhaps look at the actual evidence instead - Landlords are leaving in their droves, rents are rising and supply is getting worse. The restrictive renting policies have not been a success.