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Leasing house to the Council for 10 years / Housing for all / Long term leasing scheme /RAS Scheme

  • 15-09-2023 4:44pm
    #1
    Registered Users Posts: 3


    Inquiry Regarding Leasing a Townhouse Maisonette Property to the Council, in a commuter town in the west of Ireland

    I am seeking some guidance and insights regarding the possibility of leasing my Townhouse maisonette property to the council, specifically under the Long Term Leasing Scheme. I have done some research, but there are still some aspects that I find a bit confusing, and I'm hoping some of you might have experience or information to share.


    **Property Description:**

    My property is a Townhouse maisonette comprising a ground floor 1-bedroom apartment and a first-floor 3-bedroom apartment. Currently, there is no mortgage on the property. (But if I secured a 10 year lease I might seek a loan to renovate another property that I own to live in, also no mortgage on this dwelling either)


    **Long Term Leasing Scheme (LTLS):**

    From what I understand, the Long Term Leasing Scheme offers the advantage, such as guaranteed rental payments, the potential for 80% of the market rate, rent reviews every couple of years, and market rate determination based on similar properties listed on Daft in the area at the beginning of the lease and during reviews.


    **RAS Scheme vs. LTLS:**

    One of the key distinctions I'm trying to grasp is the difference between the RAS Scheme and the Long Term Leasing Scheme. I've heard concerns about the RAS Scheme allowing rental payments to fall into arrears, potentially leaving landlords to address the issue with tenants. With LTLS, it seems rental payment agreements are guaranteed. Can anyone shed more light on this?


    **Property Maintenance and Condition:**

    I also understand that under LTLS, the council accepts responsibility for internal repairs during the 10-year lease period. However, there seems to be some ambiguity regarding property condition when returned after 10 years. Has anyone encountered situations where the property had more than wear and tear damages? (Also I feel when it is your own property you still have to be realistic and keep an eye on the condition of the building yourself over the years so things don't get really out of hand)


    **Returning the Property After 10 Years:**

    I've heard that reclaiming your property after the 10-year LTLS agreement might not be straightforward. Can anyone provide insights or share experiences related to this process?


    **BER Rating Upgrade:**

    I understand that the BER (Building Energy Rating) of a property can be a factor in certain leasing or rental schemes, including the Long Term Leasing Scheme (LTLS). Although my property is well-maintained, I'm concerned that its current BER rating might not meet the necessary requirements. Has anyone here had to upgrade their property's BER rating to comply with such schemes? If so, could you share your experiences, including any challenges or costs involved?


    **Difficulty in Attaining Building Insurance:**

    I've also heard about potential challenges related to obtaining building insurance for properties involved in leasing schemes, like LTLS. How did you navigate this issue?

    Finally, Thank you all in advance for reading & if you have any pointers good or bad thank you for that too.



Comments

  • Registered Users, Registered Users 2 Posts: 6,003 ✭✭✭handlemaster


    Is it not the case now after 6 years there is indefinite tenureship ?



  • Registered Users Posts: 3 flettings


    Thank you for the reply- The legislation has been updated from what I understand that the LL who is in an informal or private rental agreement no longer has the right to end the Tenancy after 6 years. However, there are Grounds to end the tenancy if the the grounds are upstanding & genuine for example sale of property, genuine refurbishment, a family member needs use of the property etc:

    However anything could happen in the near future.

    My situation where I am seeking to enter an agreement with the council on a Long Term Leasing Scheme is a contractual agreement for 10 years that states that you as the LL will receive the property back in good faith after 10 years but we all know that sometimes things can seem to make theoretical sense on paper but it is another thing when it comes to the practical aspect of actually getting your property back when the time comes around ie: one side does not honour there agreement & it ultimately ends in legality.



  • Registered Users, Registered Users 2 Posts: 1,786 ✭✭✭DownByTheGarden


    You double or triple the rent if they dont hand it back to you after the 10 years. After 10 years the lease is over. You are not bound by any rent amount and are entitled to your property back. If they dont give it back then charge the council (the ones leasing it from you) as much as you like per month until you get it back. Fortunatly a lease with a company or the council is actually a lease and both parties must follow the rules of leases. Unlike a lease agreement between a landlord and an individual where only the landlord has to abide by the terms.



  • Registered Users, Registered Users 2 Posts: 6,003 ✭✭✭handlemaster


    If the property is in a rent pressure zone is the new rent not fixed to the rent that the county council were paying ?



  • Registered Users, Registered Users 2 Posts: 20,643 ✭✭✭✭Donald Trump



    Depends on the lease. If it is a commercial lease the tenant will have a right to renew a long-term lease unless you have contracted out of that. If the right is in place and the tenant (being the Council) exercises that right and you cannot agree on a cost then ultimately it would be decided in court.

    People shouldn't depend on generic "advice" from randomers on the internet based on hare-brained great ideas of loopholes they think they have discovered.



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  • Registered Users Posts: 3 flettings


    Thanks for the comments, I have been reading about some cases where the council tenancy has came to an end & the LL wants the property back under & the tenant has not moved out & has taken under the counter advice to stay in the property property until otherwise litigated or perhaps I am guessing a new lease is signed. The property is not in a rent pressured zone, I understand that when you are leasing a commercial property lets say a shop out to a commercial tenant you get a right of renunciation signed or otherwise known as a business equity signature forfeiting the right to a have right in the space, But Right of renewal is critical in this type of situation.



  • Registered Users, Registered Users 2 Posts: 20,643 ✭✭✭✭Donald Trump



    If you lease to the Council, the person living there is not your tenant. The Council is your tenant.

    The Council can not sign any new agreement with that person any more than they could sign a lease with them to allow them live in your current PPR against your wishes.

    Part IV will not apply. The ultimate tenant may still overhold but it will be the Council's responsibility.



  • Registered Users Posts: 4 ourware


    Understood @Donald Trump effectively it will come down to the detail within the lease to begin with, have you read any examples of BER Rating requirements - Fire Regulations or the Councils current willingness to assign new lease's to the Long Term Leasing Scheme?



  • Registered Users, Registered Users 2 Posts: 20,643 ✭✭✭✭Donald Trump



    No, I haven't. I am only speaking generally rather than any specifics.



  • Moderators, Education Moderators, Society & Culture Moderators Posts: 18,982 Mod ✭✭✭✭Moonbeam


    With the RAS scheme you are not guranteed rent,they do not pay deposit and you are responsible for any damage that the tenants do.

    LTLS sounds safer in the above context but when I looked in to it I decided that it was not for me, I rented it out under RAS for years but sold it recently.



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  • Registered Users Posts: 4 ourware


    @Moonbeam Thanks for the reply, in regards to inspection & regulation how did you find that aspect or was RAS as specific or conditional?



  • Registered Users, Registered Users 2 Posts: 12,870 ✭✭✭✭Flinty997


    I would like to hear more about how difficult tenants and damage was handled under LTLS before I'd consider it.

    That said after 10yrs you'd expect a certain amount of wear and tear.



  • Moderators, Education Moderators, Society & Culture Moderators Posts: 18,982 Mod ✭✭✭✭Moonbeam


    The usual RAS inspections were fine , I had to change child locks on upstairs windows and some other really minor stuff over the years .



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