The State is the one crowding out first time buyers, not investment funds

Fred Cryton · 09-05-2021 2:27pm #1

All the talk in the media about funds buying up property is misplaced. The anger is misdirected and should be focused at the State, the councils and so called "Approved housing bodies"

Let's be clear here. The REITs are just the middle men. Ultimately they are only doing this because they can lease to the council at guaranteed rent.

It is the council, backed by taxpayer funding, that is ultimately the real enemy of the hard working first time buyer. Let's not lose sight of that.

The answer here is for the government to get the heck out of the housing market and just let the private sector and private capital rip. Someone needs to stand up for the hard working first time buyer against the well funded councils housing their welfare class voters at enormous expense in desirable areas.

end of the road · 09-05-2021 4:52pm

the state did exactly what you are suggesting it should do, hence why we are where we are.

Wanderer78 · 09-05-2021 4:55pm

the state is still facilitating the sectors that have caused all our property issues, i.e. the fire sectors(finance, insurance and real estate)

Fred Cryton · 09-05-2021 5:10pm

end of the road wrote: »

the state did exactly what you are suggesting it should do, hence why we are where we are.

Wrong. The State interfered in the market by entering into agreements with REITs for council housing. That's not staying out of the market.

Outkast_IRE · 09-05-2021 5:13pm

The most worrying thing in all this is that the state is apparently entering into contracts for 15-20 years rent at a fixed rate. So even we start building enough homes and apartments the state will be paying rent at todays rates for 20 years potentially - And own no asset at the end of it !

NSAman · 09-05-2021 5:15pm

Outkast_IRE wrote: »

The most worrying thing in all this is that the state is apparently entering into contracts for 15-20 years rent at a fixed rate. So even we start building enough homes and apartments the state will be paying rent at todays rates for 20 years potentially - And own no asset at the end of it !

Not to mention getting nothing or very little in the way of tax from profits.

Utter madness!

Outkast_IRE · 09-05-2021 5:24pm

NSAman wrote: »

Not to mention getting nothing or very little in the way of tax from profits.

Utter madness!

Yeah a balance needs to be struck, but the conditions i would say are overly favourable for the funds right now.

NSAman · 09-05-2021 5:33pm

Outkast_IRE wrote: »

Yeah a balance needs to be struck, but the conditions i would say are overly favourable for the funds right now.

I’m not a landlord, but I can see that landlords (private) are being discriminated against in the current set up.

I also saw somewhere on line that BTL mortgages were practically obliterated in the past decade.

Favoured taxation set-ups for investment firms over traditional rental landlords is a disaster waiting to happen (is already happening).

The government FFFG have been abysmal in dealing with housing matters. Short-term solutions are not what are required. Unfortunately, they are not long term thinkers (not thinking at all) when it comes to this issue.

Levelling the playing field, in relation to taxation, building government controlled (council) housing and also creating a system where building is not the cash cow for tax from Irish companies is the long term solution.

We all know that planning in Ireland is a joke. The costs, the process and political interference in same, has caused more damage than it has solved.

Wanderer78 · 09-05-2021 5:36pm

NSAman wrote: »

I’m not a landlord, but I can see that landlords (private) are being discriminated against in the current set up.

I also saw somewhere on line that BTL mortgages were practically obliterated in the past decade.

Favoured taxation set-ups for investment firms over traditional rental landlords is a disaster waiting to happen (is already happening).

The government FFFG have been abysmal in dealing with housing matters. Short-term solutions are not what are required. Unfortunately, they are not long term thinkers (not thinking at all) when it comes to this issue.

Levelling the playing field, in relation to taxation, building government controlled (council) housing and also creating a system where building is not the cash cow for tax from Irish companies is the long term solution.

We all know that planning in Ireland is a joke. The costs, the process and political interference in same, has caused more damage than it has solved.

yup, small time landlords are also in serious trouble under such an economy, you simply cannot compete against such monopiles

Darc19 · 09-05-2021 5:39pm

NSAman wrote: »

I’m not a landlord, but I can see that landlords (private) are being discriminated against in the current set up.

I also saw somewhere on line that BTL mortgages were practically obliterated in the past decade.

Favoured taxation set-ups for investment firms over traditional rental landlords is a disaster waiting to happen (is already happening).

The government FFFG have been abysmal in dealing with housing matters. Short-term solutions are not what are required. Unfortunately, they are not long term thinkers (not thinking at all) when it comes to this issue.

Levelling the playing field, in relation to taxation, building government controlled (council) housing and also creating a system where building is not the cash cow for tax from Irish companies is the long term solution.

We all know that planning in Ireland is a joke. The costs, the process and political interference in same, has caused more damage than it has solved.

Favourable taxation is available to certain types of pension funds accessible to many ordinary people.

But councils including some with sinn Fein majority are renting bulk properties from these institutional landlords and are paying premium rents.

An immediate stop by any council renting bulk properties should be enacted immediately.

Dempo1 · 09-05-2021 5:49pm

Not sure how we got here but the harsh reality is if pension, vulture funds continue to be able to block purchase new housing, new buyers and those wishing to upgrade are essentially excluded, that can not be right. There's also the two immediate effects, House prices rising dramatically and Rents becoming extortionate (albeit they are already)

I was amused watching virgin media news this evening, their correspondant falling over herself with the news house viewing permitted again, all well and good if potential buyers actually get to see properties before they are sold from under them and that's before most average people could afford to purchase a property at the moment.

09-05-2021 6:21pm

NSAman wrote: »

The government FFFG have been abysmal in dealing with housing matters. Short-term solutions are not what are required. Unfortunately, they are not long term thinkers (not thinking at all) when it comes to this issue.

They can't afford to be long term thinkers. Voters want this resolved and they want it resolved now. People want to push, via taxation, property funds out of the market here now, because the affordable housing bodies are struggling to buy houses. Things just keep getting worse here instead of better when it comes to housing.

end of the road · 09-05-2021 6:26pm

Fred Cryton wrote: »

Wrong. The State interfered in the market by entering into agreements with REITs for council housing. That's not staying out of the market.

no, but that only began happening after the effects of them staying out of the market became clear.
they did what you suggested, it failed, time to go back and do something that actually did work.

The DayDream · 09-05-2021 6:32pm

You know what, I had a feeling it couldn't be all the rich folks' fault. It's always the poor who screw over the middle class, isn't it? with all their money, power, influence and connections.

One eyed Jack · 09-05-2021 6:34pm

Fred Cryton wrote: »

All the talk in the media about funds buying up property is misplaced. The anger is misdirected and should be focused at the State, the councils and so called "Approved housing bodies"

…

The answer here is for the government to get the heck out of the housing market and just let the private sector and private capital rip. Someone needs to stand up for the hard working first time buyer against the well funded councils housing their welfare class voters at enormous expense in desirable areas.

Nice try Fred

How do you see your idea working out for people who cannot afford to buy property because they are priced out of the property market by private capital investment funds? That’s why the Government is involved in regulating the property market, to prevent that sort of thing from happening.

Donald Trump · 09-05-2021 7:02pm

end of the road wrote: »

the state did exactly what you are suggesting it should do, hence why we are where we are.

No, the state can still build its own social housing. By definition, that housing isn't being produced for the market. It would be produced for those who cannot get into the market. They can build as many of those as they want.

What they are doing is instead entering the market and essentially outbidding private individuals with public money.

Wanderer78 · 09-05-2021 7:10pm

Donald Trump wrote: »

No, the state can still build its own social housing. By definition, that housing isn't being produced for the market. It would be produced for those who cannot get into the market. They can build as many of those as they want.

What they are doing is instead entering the market and essentially outbidding private individuals with public money.

the abilities of the market of being able to produce all of our needs is clearly untrue, its a figment of our imaginations, there has never been such a thing as invisible people, with invisible hands, its time for us to grow up a bit and accept this

jimmycrackcorm · 09-05-2021 7:15pm

Outkast_IRE wrote:

The most worrying thing in all this is that the state is apparently entering into contracts for 15-20 years rent at a fixed rate. So even we start building enough homes and apartments the state will be paying rent at todays rates for 20 years potentially - And own no asset at the end of it !

That's no worse than building council houses that have never gotten handed back to the state.
Either they get sold off cheaply to the tenants or the tenants children's get to hold on to them after.

At least this way the state doesn't have to pay up front for the house build.

growleaves · 09-05-2021 7:20pm

Fred Cryton wrote: »

All the talk in the media about funds buying up property is misplaced. The anger is misdirected and should be focused at the State, the councils and so called "Approved housing bodies"

Let's be clear here. The REITs are just the middle men. Ultimately they are only doing this because they can lease to the council at guaranteed rent.

It is the council, backed by taxpayer funding, that is ultimately the real enemy of the hard working first time buyer. Let's not lose sight of that.

The answer here is for the government to get the heck out of the housing market and just let the private sector and private capital rip. Someone needs to stand up for the hard working first time buyer against the well funded councils housing their welfare class voters at enormous expense in desirable areas.

I don't know what the exact breakdown of buyers is but between REITs buying to let to councils, sovereign wealth funds and individual buyers there are many factors at play.

The ECB's suppression of bond rates has helped to turn houses into financialised assets.

There are foreign investors, possibly even foreign governments(?), buying up houses here. If you "let them rip" they will buy properties as investments giving a better return than cash or stocks and they mightn't even bother with tenants.

Also the constriction of supply is partly due to lockdown. Feel free to oppose that ludicrous piece of "state intervention".

jimmycrackcorm · 09-05-2021 7:24pm

Wanderer78 wrote:

the abilities of the market of being able to produce all of our needs is clearly untrue, its a figment of our imaginations, there has never been such a thing as invisible people, with invisible hands, its time for us to grow up a bit and accept this

The same applies to the state. The abilities if the state to produce all of our needs is clearly untrue. If it was then we wouldn't need to have anyone pay for private health insurance as an example.

The state could go back to producing enough housing through schemes such as the Ballymun flats, if it could do something about the antisocial element.

Donald Trump · 10-05-2021 10:30am

Wanderer78 wrote: »

the abilities of the market of being able to produce all of our needs is clearly untrue, its a figment of our imaginations, there has never been such a thing as invisible people, with invisible hands, its time for us to grow up a bit and accept this

I think you misunderstood my post. The state/councils should not be getting involved in the private sector market like they currently do. We are in a situation where you have desk jockeys using your public money to outbid you on that house you want to buy.

It can be building its own social housing because that is, or could be, a parallel system. They can do that and still stay out of the market.

If the council builds a council estate, the direct effect on me is only that the council, with its relatively unlimited budget, is now not going to be competing against me for the private house I want to buy. The houses it built are irrelevant to me otherwise. They are for people on housing lists. They are not flooding the market.

The council can still outsource the building to the private sector for their own houses. But in the sense that they have a site, put it out to tender, and agree a contract with a builder to build X houses on it for Y. That's if they want to do it. Swooping in on just finished houses and outbidding private buyers is wrong.

Shebean · 10-05-2021 4:00pm

Fred Cryton wrote: »

All the talk in the media about funds buying up property is misplaced. The anger is misdirected and should be focused at the State, the councils and so called "Approved housing bodies"

Let's be clear here. The REITs are just the middle men. Ultimately they are only doing this because they can lease to the council at guaranteed rent.

It is the council, backed by taxpayer funding, that is ultimately the real enemy of the hard working first time buyer. Let's not lose sight of that.

The answer here is for the government to get the heck out of the housing market and just let the private sector and private capital rip. Someone needs to stand up for the hard working first time buyer against the well funded councils housing their welfare class voters at enormous expense in desirable areas.

Where are all the voting unemployed welfare classes? Surely there's more squeezed middle working voters? Pre Covid unemployment nationwide was 4.93%. I think you've been sold a pup.

Jinglejangle69 · 11-05-2021 9:00am

I see DCC voted against buying up of estates by vulture funds even though they are the ones encouraging it by taking out long term leases with the funds.

This country..

Kermit.de.frog · 11-05-2021 9:13am

Fred Cryton wrote: »

All the talk in the media about funds buying up property is misplaced. The anger is misdirected and should be focused at the State, the councils and so called "Approved housing bodies"

Let's be clear here. The REITs are just the middle men. Ultimately they are only doing this because they can lease to the council at guaranteed rent.

It is the council, backed by taxpayer funding, that is ultimately the real enemy of the hard working first time buyer. Let's not lose sight of that.

The answer here is for the government to get the heck out of the housing market and just let the private sector and private capital rip. Someone needs to stand up for the hard working first time buyer against the well funded councils housing their welfare class voters at enormous expense in desirable areas.

We need to have the council's investigated over planning as well. Another big issue.

Everyone's attention should be focused on what Dublin City Council is doing in Dublin Docklands, limiting height of buildings to just a few floors.

There could 10's of thousands of apartments built there.

A scandle and massive distortion of the market. They are taking An Bord Pleanala to court to PRRVENT new housing.

Another part of the problem.

_Kaiser_ · 11-05-2021 9:17am

Councils are definitely part of the issue alright.

As I've posted here before, I live in an end of terrace row of 4. In the last 2 years or so, 2 of those have been bought by the council and used for social housing tenants. It's happening everywhere.

It's not just other regular buyers that people are competing with, it's councils using their taxes as well.

mariaalice · 11-05-2021 9:21am

Social housing is not going away, if social housing was not purchased from the developer and was built directly by the housing associations or local council there would still be competition for land and labor to build the houses so it would change nothing for the first-time buyer.

JimmyVik · 11-05-2021 9:23am

I started a thread a good while ago about what the councils were doing in the property forum and a mod closed it, accusing me of being a conspiracy theorist. Well I guess the cat is out of the bag now. God know what can be done about it at this point.

_Kaiser_ · 11-05-2021 9:24am

mariaalice wrote: »

Social housing is not going away, if social housing was not purchased from the developer and was built directly by the housing associations or local council there would still be competition for land and labor to build the houses so it would change nothing for the first-time buyer.

It's not just buyers. Private renters are similarly under pressure because of this practise - and this is before things like O'Gorman's "own door" policy for migrants starts to come into play.

Reallocating existing supply to those who pay little to nothing for it at the expense of those who work damn hard, pay a lot of taxes and charges, and yet have nothing to show for it, is a clear sign of a broken system.

Kermit.de.frog · 11-05-2021 9:32am

JimmyVik wrote: »

I started a thread a good while ago about what the councils were doing in the property forum and a mod closed it, accusing me of being a conspiracy theorist. Well I guess the cat is out of the bag now. God know what can be done about it at this point.

It's not conspiracy. There is a range of measures being used to intentionally distort the market for various reasons.

Sinn Fein got nearly 1,000 new units in Coolock stopped because it didn't include enough social housing despite something like half being dedicated.

That's the type of sh!te your dealing with.

There should be an investigation in to particular councils in this country starting with DCC and their planning policies but others as well.

Parties like SF and other objectors should also get proper attention from the public for their antics in denying supply in areas most needed.

People think the corruption ended in the 90's.

They are in for a rude awakening and it will all come out eventually just like back then.

Dyr · 11-05-2021 9:35am

_Kaiser_ wrote: »

It's not just buyers. Private renters are similarly under pressure because of this practise - and this is before things like O'Gorman's "own door" policy for migrants starts to come into play.

Reallocating existing supply to those who pay little to nothing for it at the expense of those who work damn hard, pay a lot of taxes and charges, and yet have nothing to show for it, is a clear sign of a broken system.

We seem to think we can run a society with and endless supply of inbound migration increasing the population in flash floods

Demand will always outstrip supply when the economy is doing well, and apparently even when it isnt, as the covid local lockdown demonstrates

mariaalice · 11-05-2021 9:42am

JimmyVik wrote: »

I started a thread a good while ago about what the councils were doing in the property forum and a mod closed it, accusing me of being a conspiracy theorist. Well I guess the cat is out of the bag now. God know what can be done about it at this point.

That is an ideological point and like it or not most people don't care or have no interest in the ideology of it.

Unless the state bans social housing something that is most unlikely to happen any change would not increase supply or decrease prices, it would be just tinkering with the market. The only thing that will have an effect is supply meeting demand so more building.

Fred Cryton · 11-05-2021 11:39am

mariaalice wrote: »

Social housing is not going away, if social housing was not purchased from the developer and was built directly by the housing associations or local council there would still be competition for land and labor to build the houses so it would change nothing for the first-time buyer.

The council already gets 10% of any new estate. They also get north of 30% on State owned land.

The council should be barred completely from leasing out any of the remaining homes on a new estate.

Now THAT would make a difference to hard working first time buyers.

recyclops · 11-05-2021 11:45am

There should be a time limit on how long a property is up for sale before it can be sold to investment funds for rent or to the council, the council are outbidding a lot of people were I grew up and its pushing the prices up for FTB who want to stay in the area.

JimmyVik · 11-05-2021 12:46pm

recyclops wrote: »

There should be a time limit on how long a property is up for sale before it can be sold to investment funds for rent or to the council, the council are outbidding a lot of people were I grew up and its pushing the prices up for FTB who want to stay in the area.

Then sellers will just wait for the council.

11-05-2021 12:51pm

Part of the problem is giving houses to people not working, in areas where working people need houses. It should be the choice of council to decide where people get their subsidising house (or free!), not the recipier. Also, first time buyers a lot are looking for first house in ideal location instead of where they can afford.

thegetawaycar · 11-05-2021 1:16pm

This issue is HUGELY ignored. The council should stick to their 10% (maybe add 5/10% for charities) and the REITs should have a limit too.

At the moment the council are leasing in bulk all apartments in new builds from developers/REITs for no return after 25 years. No single FTB that wants an apartment can get one, they are all gone before going on the market.

Jinglejangle69 · 11-05-2021 1:18pm

thegetawaycar wrote: »

This issue is HUGELY ignored. The council should stick to their 10% (maybe add 5/10% for charities) and the REITs should have a limit too.

At the moment the council are leasing in bulk all apartments in new builds from developers/REITs for no return after 25 years. No single FTB that wants an apartment can get one, they are all gone before going on the market.

People wanted the scam homeless situation sorted.

They fell for Maggie cash and Erica Flemings fake tears and stories cheered on from the likes of SF and PBP.

Not forgetting Apollo house.

They were conned.

I have some sympathy, not a lot though.

Madeoface · 19-05-2021 3:45pm

I was waiting for a bus in dun laoghaire this morning and had to watch in awe as one black eyed beaten up dishevelled waster took a piss in the bus shelter while his mate rolled up a joint, giving out yards about something of huge importance, probably the middle East situation.

Don't worry lads I thought to myself, it's going to get better, our local council is leasing ye brand new gaffs, right off the plans, in cabinteely next year. Though there is no off licence in the village however so ye might have to turn it down.

If I was to rent an apartment there it would cost about 1,800 for a one bed. But u guys need it, nay deserve it, free of charge as we don't understand moral hazard in this country.

Did you smash it · 23-05-2021 1:01pm

To compare Ireland to the rest of the EU..

Beasty · 23-05-2021 2:51pm

Threads merged

crooked cockney villain · 26-05-2021 9:18pm

Fact of the matter is, the affordability crisis has only intensified in the last few months. Prior to Covid, an ex corporation house in most parts of West Dublin seldom exceeded the 190K mark. A 3 bed semi in nearby, private built estates typically started at 210K. Not cheap, but not unaffordable for a couple on average wages.

In the last few months the ex corpo homes are far breaching 200 and the former 210's are going to 250. FF needs to act fast to get this back to where it was.

But they won't. And FG definitely won't. Whether SF can when they surely get in as part of a SF FF coalition in 2024 (because FG will never get with SF) remains to be seen.

ILoveYourVibes · 26-05-2021 9:21pm

Fred Cryton wrote: »

All the talk in the media about funds buying up property is misplaced. The anger is misdirected and should be focused at the State, the councils and so called "Approved housing bodies"

Let's be clear here. The REITs are just the middle men. Ultimately they are only doing this because they can lease to the council at guaranteed rent.

It is the council, backed by taxpayer funding, that is ultimately the real enemy of the hard working first time buyer. Let's not lose sight of that.

The answer here is for the government to get the heck out of the housing market and just let the private sector and private capital rip. Someone needs to stand up for the hard working first time buyer against the well funded councils housing their welfare class voters at enormous expense in desirable areas.

For every council house there was meant to be one on the private market or something wasn't there? Not sure.

They also need to cap house prices.

People need affordable houses.

26-05-2021 9:34pm

crooked cockney villain wrote: »

Fact of the matter is, the affordability crisis has only intensified in the last few months. Prior to Covid, an ex corporation house in most parts of West Dublin seldom exceeded the 190K mark. A 3 bed semi in nearby, private built estates typically started at 210K. Not cheap, but not unaffordable for a couple on average wages.

In the last few months the ex corpo homes are far breaching 200 and the former 210's are going to 250. FF needs to act fast to get this back to where it was.

But they won't. And FG definitely won't. Whether SF can when they surely get in as part of a SF FF coalition in 2024 (because FG will never get with SF) remains to be seen.

As an economy we have performed fairly well during Covid and a lot of people are hording a fook tonne of cash and ready to buy 1st and 2nd homes. This is leading to insane demand at the minute which is driving prices through the roof. Investment funds are also eager.

I think I'll be waiting for the next crash at least to buy. Can't see any value in the market. People are very keen to buy right now at sky high prices. At 33, I might even do another stint abroad for 2/3 years and see where the housing market eventually lands at.

Freight bandit · 26-05-2021 9:38pm

They want a renters market..

ThunbergsAreGo · 26-05-2021 10:00pm

State housing is the only one true housing.

All other housing is for profit, and evil

jmlad2020 · 26-05-2021 10:03pm

This is terrible. Won't somebody please think about the Children who have to buy homes in the future

crooked cockney villain · 26-05-2021 10:14pm

It's also worth remembering that the housing crisis is only applicable to areas within easy commuting distance of Dublin. It is a Dublin crisis that only applies to Dubliners who, quite fairly, only want to live within the Dublin region. There is a glut of affordable property in most regional towns.

It is not a national crisis. Even towns within decent commuting distance of Dublin such as Dundalk have plenty of properties in reasonable areas for very affordable prices for even a single buyer with a bit of savings.

I get the feeling acknowledging this has TD's worried that rural voters will refuse to see their taxes going to subsidising housing for Dubs while they pay full whack of a very affordable amount.

Shebean · 27-05-2021 6:34pm

if a Clare native can't afford to live in Clare is it okay to suggest they move to Waterford? I think it's reasonable for people to seek accommodation in their own county were possible.

I see Barrister James Geoghegan the Fine Gael self professed 'Voice for generation locked out of the housing market', his words, lives in a 730,000 house, not in the Dublin Bay South area he's running in.

Classic Fine Gael.

Geuze · 27-05-2021 6:56pm

crooked cockney villain wrote: »

It's also worth remembering that the housing crisis is only applicable to areas within easy commuting distance of Dublin. It is a Dublin crisis that only applies to Dubliners who, quite fairly, only want to live within the Dublin region. There is a glut of affordable property in most regional towns.

I see your point, but I would add Cork and Galway to Dublin.

I'm not sure about Limerick.

The State is the one crowding out first time buyers, not investment funds

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