2% max rental increase allowed inflation 7% plus

Donald Trump

https://www.boards.ie/discussion/comment/118888025#Comment_118888025

People don't know what the price will be in the future. When they were selling, they might have anticipated that prices would drop. Prices of land, for example, dropped over the couple of years to around 2018. Many people were aware of people getting burning in the previous crash and probably wanted to take their profits and run.

"Landlords" are a funny group. They call it a business yet it is the only business that expect the State to support amateur actors.

Fattybojangles

https://www.boards.ie/discussion/comment/118887821#Comment_118887821

The property market is constantly subject to Government regulation and as for restriction on market rate are you having a laugh? Rent is colossally expensive in this country as it is you are lucky there aren't strict rent controls in this country already.

amacca

https://www.boards.ie/discussion/comment/118886332#Comment_118886332

I think we are in agreement tbh.....I don't like state meddling either, what you have described there sounds more like a functioning market and something approaching fair play.

I'm not sitting on property like smaug the dragon giving the two fingers to everyone else rubbing my hands with glee as the state tells me what I can charge for the use of my own property as I dont see that as sustainable, (now letting people build what they want wherever they want with no checks and balances is probably not a great idea either) but a functioning market with minimal state meddling and law and order is something everyone should want.....

100% in agreement on falling behind then you entered into an agreement and its time to move on and no more hap payments etc, work for it

And at the same time as that I'm not a thatcher, I think people should have good conditions to work in and fair play too. I know that might bring down rents but I dont think thats a bad thing my issue is the interference more so than the final rate.....I should be able to decide what I charge myself (even if its going to lower because of that right), I should be able to get rid of people that don't pay with a minimum of fuss and there should be recourse for damages.......in other words I don't mind less money for law and order and a functioning market...long term thats good for everyone ......if the whole thing wasn't dysfunctional they wouldn't need to be meddling in peoples affairs.

Donald Trump

https://www.boards.ie/discussion/comment/118888081#Comment_118888081

How much do you think you'd be getting for rent now if the government had not intervened during covid and supported the whole economy?

No PUP, no EWSS. No pressure on banks to bring in mortgage holidays. No borrowing to pump massive amounts into the economy overall. In a free market that is what should have happened.

Grumpypants

https://www.boards.ie/discussion/comment/118888031#Comment_118888031

I get the concept of risk-reward. The balance has been artificially skewed against landlords preventing them from getting a reward based on the level of risk they take on. As the government has put in place additional measures to increase the risk while at the same time reducing the rewards.

The reward is that after working for 30 years you "might" own a property that is worth a decent amount. That you can then sell. Because until you sell it you don't release the value.

The risk: Property prices fall, the property is damaged beyond repair, the tenants stop paying rent, the mortgage rates go up, the cost of providing the service goes up but you can't increase rent in line to cover the costs.

Don't forget if you get a mortgage for 300K you end up paying back nearly 600K. To get 600K income from the property you need to earn 1.2 million from rent.

amacca

https://www.boards.ie/discussion/comment/118888122#Comment_118888122

TBH I'd be getting the same but I'm in a unique kind of situation and I'm not saying that as an I'm all right jack statement.

I'm not a free market zealot btw, state has to intervene in some circumstances.....but comparing an exceptional event like a pandemic to an ongoing situation like the balls up made of property..................

there may be some parallels but those two are not directly analogous, arguing for one doesnt mean you are arguing for the other

Donald Trump

https://www.boards.ie/discussion/comment/118888159#Comment_118888159

It you want to lock up your money for 30 years with no risk, Irish sovereign bonds are yielding about 1.6%. So that is an option for you if you want "risk free". If you want more, then you will need to take on some more risk.

http://www.worldgovernmentbonds.com/bond-historical-data/ireland/30-years/

Grumpypants

https://www.boards.ie/discussion/comment/118888174#Comment_118888174

You can't get a mortgage to buy bonds. You can get one to buy a house to then rent out.

BASHIR

https://www.boards.ie/discussion/2058239880/2-max-rental-increase-allowed-inflation-7-plus

If you cant afford to run your "business" I suggest you sell it and try alternative forms of income

Donald Trump

https://www.boards.ie/discussion/comment/118888173#Comment_118888173

No but I find it a bit rich when general people rail against aspects of a system which is slightly to their detriment without recognising that the system is actually highly beneficial overall.

There is no way that rents in general, or property prices, would be anything like they are now had the Irish State, and others around the world, not stepped in to prop everything up. They did it for the overall benefit of society.

Donald Trump

https://www.boards.ie/discussion/comment/118888184#Comment_118888184

You can get a loan if you want. But why would someone loan you money at a rate lower than the risk free rate?

And why should you be entitled to arbitrage in the case of property? That is a very entitled perspective.

Buying a bond is giving a loan. If I buy a bank bond for 500k with a 1% yield, why do you think that you should be able to get that 500k from the bank, use it to buy a house, and have the State (including me) effectively guarantee, or at least strongly protect, you with say a 5% income? You take the risk. Your decision. It's actually my capital that is buying the house. If the State will guarantee it for me, I'll buy it myself. You can go and whistle with your mortgage.

Grumpypants

https://www.boards.ie/discussion/comment/118888212#Comment_118888212

I don't have 500k so I can't buy a bond.

ballyharpat

https://www.boards.ie/discussion/comment/118887861#Comment_118887861

I applied for PUP, as 2 of my tenants refused to pay rent for 3 months during the pandemic, I had zero income and still had overheads, I was told I am not considered self employed in the regard that PUP was counted.

Donald Trump

https://www.boards.ie/discussion/comment/118888267#Comment_118888267

You weren't prevented from performing your "employment". You still provided the houses as per your agreement. Your tenants not paying you is separate from you being able to perform your "employment" - which is what PUP was for.

It would be the difference between you not being able to work because your shop was closed and you being able to work, but the employer not paying you at the end of the month. PUP was for the former. Not the latter.

Donald Trump

https://www.boards.ie/discussion/comment/118888253#Comment_118888253

Well if you don't have the money, we are back to the doctrine of tough titties.

If you want to set up a system where there is no risk for property, you can waive goodbye to buying any more. Nobody will give you a loan to do it when they can just do it themselves for zero risk. The only reason they would not, would be if the yields (rent) come down massively.

Why on earth would you feel entitled to borrow my 500k and for me to guarantee you a return on it (thereby me taking the risk). If you want me to retain the risk, I'll buy it myself. So we'll go back to a system where people with money keep money and the plebs can stay stuck with nothing.

ballyharpat

https://www.boards.ie/discussion/comment/118888287#Comment_118888287

I read the first 4/5 of your comments on here-none of what you say is logical, you keep moving goalposts to paint the picture of landlords always being in the wrong, rhere is no debate or discussion, or willingness to look at anyone else's point of view, so excuse me as I refrain from having any communication with you , other than this one.

I do hope that you get rid whatever chip (concrete block) is on your shoulder.

Donald Trump

https://www.boards.ie/discussion/comment/118888313#Comment_118888313

I do hope you get the chip off your own shoulder. Nobody owes you a living.

What did the pandemic prevent you from doing in relation to your employment? To entitle you to the PUP.

If you were already unemployed, you'd have been entitled to apply for normal SW under normal rules.

Fattybojangles

https://www.boards.ie/discussion/comment/118888267#Comment_118888267

Get a real job then owning property is not a profession.

rightmove

https://www.boards.ie/discussion/comment/118888054#Comment_118888054

you dont know why ppl are selling??. You just go around name calling as if everything in the world is black and white. Your professional LLs are taking over now and I hope they will get a chance to discuss your rent with you. Your image of LL's needs improving. Perhaps there is some woke course for it.

Grumpypants

https://www.boards.ie/discussion/comment/118888308#Comment_118888308

What are you on about. Why would I need you to guarantee me a return?

It's not about landlords being guaranteed a return. It's about allowing them to make a return like other service providers.

It's not about giving a guarantee against landlords losses. It's about allowing landlords to stop making a loss by evicting non paying or property damaging tenants.

In the UK if they stop paying rent. You pay a small fee, go to court, judge makes a ruling, court appointed officers enforce it, they go to the house move them out, change the locks. The non paying tenant is moved out in a matter of weeks.

Here (before evictions were banned due to COVID) you could spend 18 months, and thousands of euros trying to get them out.

We should have a system where a landlord can choose who to rent to and how much to charge them. Then they can fairly take on all the risk and get the reward.

Donald Trump

https://www.boards.ie/discussion/comment/118888594#Comment_118888594

"woke" is hardly an insult now if it comes from a category of perennial priviliged whingers who want everything to be handed to them because they feel special.

If you can't handle something, get out of it. Simple as that. Don't be crying for everyone else to bail you out by changing rules and paying more just because you are inefficient and unable to manage. There is no benefit to allowing people to continue in a position when they aren't able for it. Pis$ or get off the pot as they say

And no harm to take a minute to read a post before you go off on your incoherent diatribes. I never mentioned not knowing why people sell

Donald Trump

https://www.boards.ie/discussion/comment/118888645#Comment_118888645

You get your high yields because of those issues. Not in spite of them. I think that is what you don't understand.

Why would you expect to be given access to my capital for basically the risk free rate and then earn a relatively huge return on it for little to no risk and little to no effort on your behalf?

You get your higher return because that risk exists.

mrslancaster

https://www.boards.ie/discussion/comment/118887923#Comment_118887923

Well I expected to be attacked for asking a general question so no big surprise there. Not a landlord here btw.

You seem to have all the answers but just to be clear, I was trying to find out how two citizens, who are both liable to the same tax, prsi and usc rates on their personal income (irrespective of the source of that income) were treated with regard to income supports during the pandemic.

The example of self-employed was used as that group of citizens pay PRSI & USC on their income at the same rates as landlords. And as you mention it, personal income in the form of dividends are also liable to the same prsi & usc rates.

The term self-employed covers people who are self-assessed and file their own tax returns with Revenue, ie, anyone other than a PAYE employee. So if you are saying that the benefits linked to the same rates of PRSI contributions are different for different citizens, then why is that?

Donald Trump

https://www.boards.ie/discussion/comment/118888688#Comment_118888688

I'll give you a clue. You might not have been aware but PUP was not named after a crowd of bigots up the North, nor was it named after a young dog. It was an acronym which stood for Pandemic Unemployment Payment. It was a payment for people who became unemployed due to the pandemic. It is fairly self-explanatory.

It was not a payment for people who were owed any money for any reason by anyone anywhere. If I gave my buddy 100 quid two weeks before covid hit and he didn't pay me back, I can't claim it back from the State under PUP either.

Do you know any landlords who were prevented from performing their "employment" during the pandemic? Can you explain how that employment was stopped?

mrslancaster

https://www.boards.ie/discussion/comment/118888725#Comment_118888725

No need to be all shouty and angry in your replies - it's just a discussion with different questions and opinions.

You seem to know a lot more about certain things than some others do, me included, but why do you get so het up and annoyed when people on this forum ask a simple question?

I got an answer from @ballyharpat thanks.

mrslancaster

@Donald Trump

Just FYI, those landlords paying Class S PRSI @ 4% are classed as self-employed.

From Department of Social Protection; Published on 4 February 2020

Individuals in the following employments will be classed as PRSI Class S and will pay the rate in the table below;

• Self-employed people, including certain company directors and certain people with income from investments and rents and members of a local authority.
• The minimum annual contribution for Class S is €500.

StupidLikeAFox

https://www.boards.ie/discussion/comment/118888159#Comment_118888159

"Don't forget that if you get a mortgage for 65k, you'll end up paying back 130k, which you need to earn 260k in rent"

This is somebody from 30 years ago using the same logic you are using now.

I just don't get the idea that a landlord should get subsidised/special tax treatment for what is effectively a largely passive income

Donald Trump

https://www.boards.ie/discussion/comment/118889030#Comment_118889030

That is not relevant. The PUP was for those who became unemployed due to the pandemic. Not for those who did not receive money owed during that time.

Your link does not class people as self-employed. It just says that the 4% rate is also paid on other incomes such as investment and rents.

I'm pretty sure I pay the 4% PRSI (and DIRT) on non-EU interest income I receive. I don't put that much pass on them as it would be 4% of less than half a percent interest anyway. That wouldn't make me, in and of itself, self employed. I just fire it into the Form 11 or whatever the number is.

Donald Trump

https://www.boards.ie/discussion/comment/118889048#Comment_118889048

They always forget that they will pay no CGT on the nominal amount paid for the house.

rightmove

https://www.boards.ie/discussion/comment/118888672#Comment_118888672

honestly you dont have a clue. I was a renter for more of my life than a LL. I am neither now but I will stand up for something when I see it been made a mess off. Your incapable of seeing the real enemy. The REITS and the Government and SF if they get in.

You sound like you are not too long in the tooth TBH.

mrslancaster

https://www.boards.ie/discussion/comment/118889098#Comment_118889098

Well it is a bit relevant when you said earlier that anyone who rented out property and described it as self-employment was "the height of self-delusion". It seems that the term is used by both Revenue and DSP.

https://www.boards.ie/discussion/comment/118887923#Comment_118887923

Donald Trump

https://www.boards.ie/discussion/comment/118889143#Comment_118889143

You're attempt at an insult of "not having a clue" is merely an attempted projection of your own inadequacies.

While you might find the whole concept of renting out something - receiving the use of it and paying something in return - to be taxing on your brain. It is actually quite a simple concept.

Donald Trump

https://www.boards.ie/discussion/comment/118889157#Comment_118889157

It isn't self employment. You just pay the same rate of PRSI.

You will be subject to the same rates of income tax as a doctor. It doesn't mean you are a doctor FFS

If a person with a property rented out loses their job after 10 years continuous employment, they will get jobseekers. Unless you want to suggest that they shouldn't as they are still "self-employed"?

Grumpypants

https://www.boards.ie/discussion/comment/118888683#Comment_118888683

Wait a minute. All this time you are thinking that being a landlord is a "high reward" investment !! FFS.

How do you figure that out?

Unfortunately, people are daft enough to think that if the landlord gets 2K rent a month, that means they are making 24K a year.

The vast majority of landlords run at a loss for decades until the debt is paid off, at which time they will start to make a small profit. The pay off isn't until they sell and the capital that has been built up is released. Even at that point, it is unlikely to be any great windfall when you consider the total outlay and effort put in.

A minimum wage job would pay more than most landlords make. (20K a year for 30 years is 600K)

Grumpypants

https://www.boards.ie/discussion/comment/118889048#Comment_118889048

What subsidy are you on about? Landlords should pay their tax, there is no need for any tax relief or subsidy (they don't get any anyway). They should be allowed to put their service out to the public at a price they chose and if someone wants to use it they should pay for it.

It's a pretty simple concept. If I want to charge ten grand a week for my house, and you don't want to pay ten grand a week, then don't enter into a contract that says you will rent it for ten grand a week to rent my house.

Donald Trump

https://www.boards.ie/discussion/comment/118889395#Comment_118889395

What do you think Grumpypants. 500k in the bank. Risk free is that I can stick it into State Savings and have 550k in 10 years. That is your base rate of return.

Do you think that if I use it to buy a house, rent it out for 10 years (even just saving the income) and sell it at year 10, that I might have more than 550k at the end of it?

You're exhibiting a massive misunderstanding of your own "investment" by saying you "run a loss". You are not running anything. You are just paying for an asset over time. At the end of it, you get all that juicy capital tax free (up to the initial price ......... that you used someone else's capital to actually pay for.). The strange thing ios that you are going on about "outlay" and "effort". For the former, as stated, you appear to be borrowing other people's money to put it in, and then if it is too much of an effort, then frankly, maybe it isn't for you. It's a relatively passive investment. You can't count the "capital" twice. You either pay it up front or you are paying it off over the life of the mortgage. But you only pay it once.

It would be a bit like if the government brought in another SSIA type scheme and I maxed it out, all the while complaining I was "running at a loss"

amacca

https://www.boards.ie/discussion/comment/118889143#Comment_118889143

I thought young and inexperienced tbh.......

amacca

https://www.boards.ie/discussion/comment/118888203#Comment_118888203

If you just consider rental rates alone without thinking of other factors like

Quality of life

The kind of society/damage to social cohesion

Cost of living and transaction

Difficulty in transacting etc

Etc

Then yes you might think that about people, I think I made it vlear it wasn't just the rental rate. Its not a functioning market and its increasingly becoming a dysfunctional society that's what depresses me.

rightmove

https://www.boards.ie/discussion/comment/118889175#Comment_118889175

now I really know you havent got a clue.😆

Donald Trump

https://www.boards.ie/discussion/comment/118889765#Comment_118889765

I'm not disagreeing.

However when one can accept the principle that there was a necessity for the state to step in due to the greater social good, then they have established that they understand that principle and should not be unable to see the reason behind other similar social measures such as rent controls.

I was trying to buy some property (cash purchase, not residential) before covid came. In the end up the seller did not sell. So I actually had a big chunk sitting there in cash when covid hit. Had the arse fallen out of the market, I'd have been well placed to buy up property at a knock down prices by virtue of pure luck. However I understand, accept, and agree with, the actions taken to protect the economy. I would never complain that they should not have been done because I would have benefited more had they not been.

There appear to be plenty of greedy people on here who moan and are apparently oblivious to the fact that their current position were actually greatly helped by the state and society overall. So when they moan moan moan that the same State puts in some protections which help others slightly and not them, I'm happy to point it out.

Donald Trump

https://www.boards.ie/discussion/comment/118889811#Comment_118889811

Don't worry dude. You'll get your head around it some day. Even if you are struggling with it now, just stick at it.

L1011

https://www.boards.ie/discussion/comment/118889832#Comment_118889832

Your posting style on this and other recent threads is overly aggressive and overly personal. Please take some time to consider this before posting again. Do not reply to this post.

Ray Palmer

https://www.boards.ie/discussion/comment/118889473#Comment_118889473

That is your view

Reality is different. When buy a property to rent out most people will expect that initially the rent will not cover the mortgage and expenses. As time moves on the expectation is that will change to the rent exceeding the mortgage and other costs.

After a time many landlords found they were making a profit a profit while still gaining the asset. Now due to the restrictions that profit reduces and may return to a state where they are adding to the rent to cover increased expenses. This will happen while all their income decreases in value. THe only reason they cannot stay inline with inflation is due to government interference.

You might be happy for the LLs to just leave if they don't like it but there are issues with this.

Either way people have a right to complain and also point out the negative effects of the policy

Grumpypants

https://www.boards.ie/discussion/comment/118889473#Comment_118889473

Lots of people thought that in 2005. I'll buy a house now and in ten years it will be worth more. It was worth about 70% less.

I understand the timeline. I also understand a balance sheet. It's the same for most businesses. You put in capital+time, you run at a loss for x days, it takes time for you to break even, then from that point you are in the black and start making money.

The timeline is different depending on the buisiness. That's where "Black Friday" comes from, shops were in the red (running a loss) up until thanksgiving. Then they go into the "black" and start making money. so they flog off the stock at a discount to make room for next year's.

In my case, I bought the house in 2004. I'll be in the red for about another ten years. Then I'll be able to start making some money on it. Maybe 4 or 5 grand a year after tax and costs.

Donald Trump

https://www.boards.ie/discussion/comment/118889866#Comment_118889866

Expectations =/= reality.

What is your basis for expecting that a mortgage should cover a capital asset which doesn't really depreciate? Other than you want it to?

DFB-D

https://www.boards.ie/discussion/comment/118889157#Comment_118889157

That is just silly now. Read case V income!

Donald Trump

https://www.boards.ie/discussion/comment/118889951#Comment_118889951

Again, I think you are double counting the capital. You either put the capital in, or you had an agreement with a lender where they put in the capital and you paid them back over time. If you go to DID electrical and buy a 1000 Euro TV on finance deal so that a finance company pays DID for the TV and you pay them back in 10 installments of 100, you haven't paid both the 1000 and the 1100.

BTW, if you bought in 2004 and you still don't have any real equity in it, something was seriously wrong there. First of all your house has to be valued at more today then it was then - it is a couple of years since they said that houses were back at Celtic Tiger peaks which happened well after 2004. Plus 18 years of either rental income or else saving rent and you still only owe what the property is worth? After an unprecedented period of historically extremely low rates? Man you were lucky the rates didn't go back to normal levels during that time.

Donald Trump

https://www.boards.ie/discussion/comment/118889981#Comment_118889981

mrslancasters conclusion, as I pointed out, would mean that nobody who had any investment income or any form, could avail of jobseekers if they lost their day job even if they had been paying stamps for years. I would not agree with that.

mrslancaster

Others may know all about the DSP Benefits associated with Class S PRSI 4% contributions but I don't and was curious about what supports were payable to Class S contributors during the pandemic. I know from @ballyharpat that the support was only made available for Class S contributors who had 'trading income'.

If DSP benefits are only available to citizens who pay Class S Prsi with 'trading income' and not to other contributors, then the information is not very clear IMO.

Maybe landlords have a valid gripe when they say they're taxed more than others if the 4% PRSI must be paid but they're ineligble for any associated benefits. Either it's a Class S contribution with eligibility for the benefits or it's just an extra 4% tax.

https://www.boards.ie/discussion/comment/118887852#Comment_118887852

Like the rest, doesn't know, doesn't care to find out. Homeowning voters are all that really matter along with social housing tenants in long leases.

Iv a few new colleagues looking for places to rent for 3 months now, but none of the politicians will give a damn.

Less landlords = big idealogical victory to people who already own their houses (quite often inherited too)