Will the rental market improve now that restrictions are easing?

Sugar_Rush

I was looking at some accommodation over the last week and a broker or two seemed to think that properties may start coming online over the next few months with easing of restrictions.

As I understand it the rental market went to Bolivia since defectors started returning home amidst the pandemic and presumably the loss of employment abroad.

We had a hypothesis in early pandemic times that the pandemic would actually positively effect the Irish rental market as it meant foreign nationals here would return home thus freeing up properties;

I guess we didn't count on the reverse of that effect causing the entire situation to implode.

Thoughts on increasing of rental accommodation availability over the coming months, or are we looking at a year + before things normalize again?

J_1980

rents in Dublin have been effectively stale since 2017.

when I moved here it wws crazy compared to London (given that London is a global capital city).

nowadays it seems fairly priced. Just looking at the trimbleston/goatstown 2beds for 2200 myself. These are nicely sized, modern 2b2b apartments. Converting to sterling thats 425gbp a week. Looking on rightmove you get a pokey 1bed in London for that nowadays. Seems fair in comparison.

the lower end of the market it still quite miserable in Dublin though.

Flinty997

The problem is too many people too few rentals. Building too few.

There is nothing to suggest any of that will change.

zell12

Huge amount of money still chasing property assets and lack of supply means rents will rise

Plus many EU citizens will be expected to migrate here instead of UK, causing more rental demand

Mrs OBumble

Government policies still discourage landlords. Those who have sold won't be back on the rental market anytime soon.

Sugar_Rush

https://www.boards.ie/discussion/comment/118520789#Comment_118520789

Those returning home from overseas caused the spike in demand.

Given easing of restrictions its possible they'll skip the country again, freeing up rentals?

Difficult to predict, just as current rental crises is something no one saw coming.

Sugar_Rush

https://www.boards.ie/discussion/comment/118520815#Comment_118520815

What are investor purchasers doing with the properties in that case?

J_1980

https://www.boards.ie/discussion/comment/118520863#Comment_118520863

Rental usually have higher density of occupation.

Owner occupiers are usually 2 adults per house. Rentals can be up to 4/5. These are forced into decreasing stock and competing with tenants families (who often rent apartments too)

Mrs OBumble

https://www.boards.ie/discussion/comment/118520863#Comment_118520863

Very few investor purchasers now. Mostly all OO. Or purchased by councils /AHBs for social housing.

Patsy167

I would say the demand for rentals in Dublin with increase. Young people who moved back to their parents house in the country will be returning to the city as offices reopen.

Flinty997

https://www.boards.ie/discussion/comment/118520849#Comment_118520849

They didn't really. The demand never fell. There was no reason to leave Ireland during the pandemic. Many businesses actually boomed during the lockdown.

Are you planning on leaving or staying and renting? Everyone else is doing the same thing.

Sugar_Rush

^^ 18/24 months ago rentals were far easier to come by.

Since then it's dried up like a sponge.

How do you rationalize that?

Flinty997

That's how a shortage works. It's gets increasingly worse over time.

There was a slight movement when they dumped Airbnb out of the market and also lockdown kicked off. They've also changed the legislation for Landlords multiple times since then.

https://m.independent.ie/news/tenants-feel-squeeze-as-46-landlords-a-week-left-market-in-the-autumn-41121495.html

Claw Hammer

https://www.boards.ie/discussion/comment/118521180#Comment_118521180

Landlords leaving the market, landlords deciding to leave units vacant because of the rent cap, returning emigrants, the slowdown in building combined with the increase in household formation, students giving up accommodation at the start of the pandemic having to come back as the colleges returned to campus. The pandemic has shown that when rents fall, the landlords quit so there is a natural floor. As workers return to offices the WFH fad will unwind and remote country arears will lose their attraction. Other factors which will influence the market are going to be increased net inward migration. After the pandemic the chickens are going to come home to roost. Thousands of landlords gone from the market and AirBnB kicking off again removing further units, hotels and pubs desperate for staff bringing in South Americans who will cram into every nook and cranny of available accommodation. As far as pain in the rental market goes, you ain't seen nothing yet!

tommyombomb

So worried about this opening up. Mainly cos I moved from Dublin back home but now fear I'll be paying 1k for a room when I have to go back to Dublin.

Sugar_Rush

https://www.boards.ie/discussion/comment/118521680#Comment_118521680

There's some rationale behind your contention but I must ask;

Is it based on well founded knowledge/education, or skepticism?

........

An apartment beside me went on the market recently for a relatively insane asking price given it's floor space.

When it's sold I'm curious whether the purchaser will be an investor and may rent it out and I may be able to upgrade.

I spoke with the auctioneer and their opinion is anyone buying in this market is either going to be an owner-occupier or just buying for an immediate family member.

Claw Hammer

https://www.boards.ie/discussion/comment/118521772#Comment_118521772

I am not going to give an autobiography.

Sugar_Rush

https://www.boards.ie/discussion/comment/118521923#Comment_118521923

Overviewed your last thread,

https://www.boards.ie/discussion/2058214026/exodus-of-small-investors-from-the-irish-rental-sector-has-reduced-the-number-of-available-tenancies

From what I gathered places are being bought up by local authorities and given to low/non-earners to alleviate homelessness?

DubCount

Before the pandemic, we had a supply problem - too may prospective renters chasing too few available rental properties. Thats why RPZ's etc were brought in, long before covid hit.

During the pandemic, supply has continued to contract. Building completions interrupted by covid shut downs, property purchase cost increasing making it more attractive for landlords to leave, government anti-landlord policies making it more attractive for landlords to leave. This was offset by some easing of demand with work from home, colleges going online, immigrants returning home as work was suspended.

The future of rental price pressure will depend on if and how fast the demand pressure returns. With nothing happening to bolster supply though, I cannot see any reduction in rents coming any time soon.

Flinty997

https://www.boards.ie/discussion/comment/118521772#Comment_118521772

It's quite simple.

You can get any property you want. Just out bid everyone.

tommyombomb

https://www.boards.ie/discussion/comment/118521967#Comment_118521967

Honestly I would be happy if I could get something for 800 I would be happy enough. Still a lot compared to what I'm expecting to pay for mortgage (1230 pm).

Im just stressed that I will have to move up too quick as only about 4 months from having enough of a deposit to buy an apartment. If I move up I'll need 10months at least. Prob just a selfish opinion

agoodpunt

still a race to the exit less supply, no money in renting a couple of places any more unless its for cash and thats time consuming.

High taxes, standards, regs and admin have sapped the any incentives that where there.

There large pros are able to absorb they pay less tax and can manage profit targets

agoodpunt

https://www.boards.ie/discussion/comment/118523157#Comment_118523157

A mortgage and a rent are two different things because rental does include property tax, management charges, maintaince and some utilities

If you stop paying young mortage bank wont be as easy as LL who has to comply with RTB rules.

Bass Reeves

Another interesting factor was the Labour party and other left wingers were gung-ho about bringing in legislation to freeze rents, prevent rented houses being vacated before sales, unrestricted tenancy lengths, entitlement to keep pets etc. Now the rush to bring in the bill seems to have slowed down. The continual exit of LL may have impacted the thinking behind the bill.

agoodpunt

Damage is already done

Claw Hammer

many people came into the letting business either by accident after the crash because of negative equity or by availing of incentives which were in place from the 1980s to the noughties. The accidentals will sell virtually as soon as they can in a lot of cases. The Investors who bought because of tax incentives are in a radically different situation from when they purchased. When they bought, interest was fully tax deductible, there was no lpt, they got a tax free allowance against their rental income of about 75% of the price of the property which only applied after the other expenses were deducted from the rental income. In many cases they paid no rent for years as the mortgage interest meant there was very little tax due. There was no registration and no inspections from the council, no rent caps and no RTB. Tenants could be turfed out on a months notice and non paying tenants could be got rid of easily. Many in that latter category are also fed up with taxes charges and regulations and laws which change frequently. The Tenancies Act was brought in after a survey done around 2002. It largely reflected the rental market at that time. It is no completely out of date and the changes made since have turned it into spaghetti type law. It is all over the place. As long as that regime persists there will be no respite for tenants. landlords have a choice, they can rent out, leave empty or sell. Tenants have to live somewhere.

JimmyVik

We have lost and are losing so many rental properties.

no matter what you do, anyone who has left the rental game wont be coming back. You wont be persuading any new entrants unless they are REITs, no matter what you do. There is only so many times an investor can be slapped in the face.

Now the best that can be hoped for is that you persuade the (with a carrot, not a stick, nobody responds to the stick as we have seen) the ones who remain but are queing up for an exit to stay. And I dont see the government doing that in Ireland.

So yes, rents to continue rising for many years to come

Topgear on Dave

https://www.boards.ie/discussion/comment/118523279#Comment_118523279

Of course they are. Practically speaking I think lots of these moves will totally screw things. But ideologically they are absolutely the right things to do.

rightmove

https://www.boards.ie/discussion/comment/118531292#Comment_118531292

Surely the right thing to do would be to have more rental properties available for more ppl and help ease the prices and give renters some choice. So far ever government measures helped do the opposite to this. The measures were all virtue signaled type politics which pitted the small LL versus the tenant and the small LL left the market. They policies were spineless and cheer lead by a media who seem not to understand or care about the consequences of their opinion driven bile.

Ray Palmer

https://www.boards.ie/discussion/comment/118531292#Comment_118531292

I don't think they are ideologically they are right things. Rent freeze seems immoral to me as take no consideration to people renting below the market rate and forces that price on the landlord for the next tenancy. If an employee worked for a company below market rates and was bought out and then tells the employee that legally they can't increase the salary it would be wrong and the same applies to landlords.

You can't force an employee to work in a company but indefinitely forcing a landlord to keep renting is fine.

Most policies are to give the appearance of action and not actually correct the issue. Rent freeze isn't about fair rents but keeping the figure of rent rises down. A disincentive for people who rented out property as a service for decades.

JimmyVik

If you have two shops next door to you selling loaves of Brennans bread.

one of them gave a loaf to someone he felt sorry for for 50c.

Then the govt made it law that he had to give everyone else the loaf for 50c after that while the shop next door could charge what the market price is.

Brennans increase the wholesale cost of a loaf over the years.

What do you think is going to happen to the shop keeper who can only charge 50c a loaf. he is going to stop selling the bread. Now the one next door can do what he likes with bread.

And if shops only sold Brennans bread, which one of them is going to go out of business if he continues to sell it.