Dublin - Significant reduction in rents coming?

Timing belt · 16-01-2021 8:45pm

Ozark707 wrote: »

As some of the other posters on this page have shown there is quite a bit of supply being effectively held back due to unrealistic rents being sought. If more of the same is brought to the market it is hardly going to help matters. Unless the government do something about that nothing will change.

If there is more supply they will not be able to hold out unless they own it all.

The more gov intervention the less supply in the long run

Smouse156 · 16-01-2021 9:04pm

If WFH becomes significant they will maintain their huge vacancy rates! Easier to pretend and extend but can’t last forever. Dublin won’t see 2019 rents/demand for years to come

The_Conductor · 16-01-2021 9:07pm

Smouse156 wrote: »

If WFH becomes significant they will maintain their huge vacancy rates! Easier to pretend and extend but can’t last forever. Dublin won’t see 2019 rents/demand for years to come

With the new legislation they're bringing in- it is entirely foreseeable that demand in remote areas will grow- while demand in Dublin (and probably Galway and Cork) will fall. The availability of broadband will become a deciding factor on the attractiveness of a property from the perspective of someone who plans to WFH.

In all probability- people will work centrally- perhaps 1 day a week- and simply commute for that day (from where-ever they setup base)- and thank their lucky stars that they don't work in Dublin any longer..........

Ozark707 · 16-01-2021 9:17pm

Smouse156 wrote: »

If WFH becomes significant they will maintain their huge vacancy rates! Easier to pretend and extend but can’t last forever. Dublin won’t see 2019 rents/demand for years to come

Whilst I agree we probably won't see 2019 levels for quite a while I can see the pretend and extend lasting for a considerable time going forward. It has lasted since well before Covid struck.

steddyeddy · 16-01-2021 10:01pm

The_Conductor wrote: »

With the new legislation they're bringing in- it is entirely foreseeable that demand in remote areas will grow- while demand in Dublin (and probably Galway and Cork) will fall. The availability of broadband will become a deciding factor on the attractiveness of a property from the perspective of someone who plans to WFH.

In all probability- people will work centrally- perhaps 1 day a week- and simply commute for that day (from where-ever they setup base)- and thank their lucky stars that they don't work in Dublin any longer..........

I'm looking at Galway myself. I'm a Dubliner but I couldn't stomach paying those rents for working in Dublin. Germany is attractive to me right now as it's fairly decentralised relative to Ireland.

Smouse156 · 16-01-2021 11:01pm

steddyeddy wrote: »

I'm looking at Galway myself. I'm a Dubliner but I couldn't stomach paying those rents for working in Dublin. Germany is attractive to me right now as it's fairly decentralised relative to Ireland.

Told my company staying in Cork for another year, **** Dublin rent! No issues! The Ghetto will remain empty for the foreseeable especially as all the good attractions (events, theatres, nightlife etc) remain closed. So you’d only be going there for it’s other attractions: shootings, gangs and drug dealing

Ozark707 · 16-01-2021 11:04pm

steddyeddy wrote: »

I'm looking at Galway myself. I'm a Dubliner but I couldn't stomach paying those rents for working in Dublin. Germany is attractive to me right now as it's fairly decentralised relative to Ireland.

If your job allows/enables you to work in a location outside of Dublin you can certainly get better value outside of Dublin. That article on SF was very interesting. Will be interesting to see if rents/house prices continue to climb outside of Dublin going forward.

Browney7 · 16-01-2021 11:39pm

Ozark707 wrote: »

Whilst I agree we probably won't see 2019 levels for quite a while I can see the pretend and extend lasting for a considerable time going forward. It has lasted since well before Covid struck.

Whilst interest rates are negative, the opportunity cost of holding empty property is small so extend and pretend will go on! The Irish government will probably be the renter of last resort then and ride to the rescue with sweetheart long term HAP deals

Ozark707 · 17-01-2021 12:14am

Browney7 wrote: »

The Irish government will probably be the renter of last resort then and ride to the rescue with sweetheart long term HAP deals

Yep that cheque book will save many a LL going forward

agoodpunt · 17-01-2021 6:49am

also know many a LL wont touch hap, needs the "it is illegal to refuse" to emphasize that point speaks for itself...

Browney7 · 17-01-2021 12:58pm

Browney7 wrote: »

Brexit would have had impacts too surely in London. But yes, rent control legislation would make Dublin a bit different. Looking at Daft.ie, it appears several of the large multi unit developments owned by the likes of Kennedy Wilson and IRES REIT have a lot of vacancies but are in no rush to reduce rents - to avoid being locked into lower rents or a more likely reason to avoid having to write down the property value.

Kennedy Wilson had in their Q3 report that their Clancy quay development was c.30% occupied but as it's a new development I'm uncertain how long they've been trying to fill it.

https://www.businesspost.ie/houses/hundreds-of-luxury-apartments-controlled-by-us-fund-lie-vacant-in-capital-7993e066?utm_campaign=article&utm_source=twitter&utm_medium=web business post has a piece today on this

Graham · 17-01-2021 1:12pm

The same site also reports today:

Rents ‘set to rise again’ as increasing numbers of landlords sell up

Residential estate expert at Sherry FitzGerald says a third of its sales are through private landlords exiting the market

That might explain why some of the REITS aren't opting for fire-sale lettings.

Dav010 · 17-01-2021 1:15pm

Graham wrote: »

The same site also reports today:

That might explain why some of the REITS aren't opting for fire-sale lettings.

Is the SF nationally or just in Dublin? That is an astonishing percentage of sales.

Browney7 · 17-01-2021 1:30pm

Graham wrote: »

The same site also reports today:

That might explain why some of the REITS aren't opting for fire-sale lettings.

Fair point - with absolute value of sales volume being low as is frequently being pointed out on the forum (people not moving house etc) then it's conceivable that a third of their sales at present will be landlords leaving the market (denominator much lower and pent up demand of landlords trying to leave the market who couldn't serve notice for a good while with restrictions). Point being stats at present can look alarmist with Covid.

With more and more REIT properties being purchased and delivered and aimed at corporate standards with aspirational rents there is still going to be a dearth of availability of "average" properties for rent. My own view is there is loads of property empty at the high end but the demand side in the middle greatly outweighs available supply. Who will buy the property off the landlords selling if REITs are aiming at the high end?

Graham · 17-01-2021 2:48pm

Browney7 wrote: »

the demand side in the middle greatly outweighs available supply. Who will buy the property off the landlords selling if REITs are aiming at the high end?

that demand side in the middle would be my guess.

I'd expect those ex-rental properties reported by Sherry Fitz will become owner occupied.

Khumatmibro · 17-01-2021 3:03pm

Dav010 wrote: »

I would say most cities have their fair share of undesirables, Dublin is no different. Luckily, you are not required to raise your kids there, there are many beautiful and safe parts of Ireland to choose from.

You're right however there seems to be a rise in violent crime amongst young people, similar to that seen in Dublin in rural areas now. I understand I am maybe being a bit irrational at the minute but there just seems to be constant stories of violent crime all over the country.

Graham · 17-01-2021 3:03pm

Mod Note

Khumatmibro please read the thread title and forum charter before posting again.

Off topic posts deleted.

Please do not reply to this post.

Ozark707 · 17-01-2021 5:10pm

Browney7 wrote: »

https://www.businesspost.ie/houses/hundreds-of-luxury-apartments-controlled-by-us-fund-lie-vacant-in-capital-7993e066?utm_campaign=article&utm_source=twitter&utm_medium=web business post has a piece today on this

So a couple of developments between them have hundreds of empties. Shows the extent of the issue out there. Can the government continue to ignore the elephant in the corner corner for much longer?

errlloyd · 17-01-2021 5:45pm

Can confirm that a decent proportion of the apartments I have viewed to buy in Dublin are private landlords selling. And every Estate Agent says the buyer are all owner occupiers.

PommieBast · 17-01-2021 5:54pm

errlloyd wrote: »

Can confirm that a decent proportion of the apartments I have viewed to buy in Dublin are private landlords selling. And every Estate Agent says the buyer are all owner occupiers.

From my own experience I would say ex-rental is the vast majority of sellers. I suspect that a lot of the buyers are actully ex-renters.

Ozark707 · 17-01-2021 10:03pm

PommieBast wrote: »

From my own experience I would say ex-rental is the vast majority of sellers. I suspect that a lot of the buyers are actully ex-renters.

Well according to many on here no one should be getting into being a LL so that is unsurprising.

JimmyVik · 18-01-2021 10:53am

I can tell you also that I know a lot of landlords and all of them are selling up now or asap.
A fair few of them were accidental landlords and are now bolting for the door.
I also know a few people who wanted to get into residential investment at some time or other over the last few years, but when they did their homework none invested in the end.
There is nothing to keep ordinary landlords in the market at the moment, and a hundred reasons for the to get out as fast as they can.

PommieBast · 18-01-2021 11:53am

Ozark707 wrote: »

Well according to many on here no one should be getting into being a LL so that is unsurprising.

Maybe I misread the post I replied to. By "every Estate Agent says the buyer are all owner occupiers" it sounded like those who already own property rather than those going from renter to owner..

Edgware · 18-01-2021 1:18pm

Ozark707 wrote: »

So a couple of developments between them have hundreds of empties. Shows the extent of the issue out there. Can the government continue to ignore the elephant in the corner corner for much longer?

Thanks for that. I hadnt read the Business Post. There are a lot of factors that are contributing to the situation of empty rentals:
Native Irish leaving the city during Covid to work from their family homes in the provinces.
Reduction in the number of non Irish coming to work for the multi nationals due to reduced recruitment, reduced mobility of labour due to Covid
Cheaper options from "accidental landlords" or single property landlords. The Kennedy Wilson rents are excessive
Reluctance by Vultures to reduce rents as they will be caught by the Rent Restrictions when Covid restrictions ease later this year.

Incidentally I see Dublin City Council are owed 30 million in rent arrears. What efforts are being made to recover same?

Dav010 · 18-01-2021 1:41pm

PommieBast wrote: »

Maybe I misread the post I replied to. By "every Estate Agent says the buyer are all owner occupiers" it sounded like those who already own property rather than those going from renter to owner..

They are buying to occupy it themselves rather than B2L.

rightmove · 18-01-2021 2:02pm

Dav010 wrote: »

They are buying to occupy it themselves rather than B2L.

Rentals also have higher occupancy then ppl buying to live somewhere themselves so if all the LL that are selling are taken out of rental and its owner occupiers buying we will see higher displacement.i.e. problem getting worse.

PommieBast · 18-01-2021 3:08pm

Dav010 wrote: »

They are buying to occupy it themselves rather than B2L.

I was thinking in terms of people who are becoming owner-occupiers. In the current climate I doubt people who already owns property will really be interested in buying city-centre apartments.

Lux23 · 18-01-2021 3:21pm

JimmyVik wrote: »

I can tell you also that I know a lot of landlords and all of them are selling up now or asap.
A fair few of them were accidental landlords and are now bolting for the door.
I also know a few people who wanted to get into residential investment at some time or other over the last few years, but when they did their homework none invested in the end.
There is nothing to keep ordinary landlords in the market at the moment, and a hundred reasons for the to get out as fast as they can.

In that case, why isn't there more supply on the market for sale? I am looking for a city centre place, two bedrooms and I am not fussy about whether it is a house or an apartment, but there seems to be very little out there.

JimmyVik · 18-01-2021 3:23pm

PommieBast wrote: »

I was thinking in terms of people who are becoming owner-occupiers. In the current climate I doubt people who already owns property will really be interested in buying city-centre apartments.

What about the 3 house in Santry that has a few people sharing in it?
One decides to buy their own place to shack up with the other half.
Thats usually how house shares end in my experience

Or if they dont want to buy in the city center then those places might all just be left to the REITS.

JimmyVik · 18-01-2021 3:25pm

Lux23 wrote: »

In that case, why isn't there more supply on the market for sale? I am looking for a city centre place, two bedrooms and I am not fussy about whether it is a house or an apartment, but there seems to be very little out there.

Was looking to rent one myself there last year. In the end i gave up and bought.
REITs are contacting entire blocks to ask people to sell to them. And people are. Especially landlords looking to get out.

Dublin - Significant reduction in rents coming?

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