Are rent controls making things better or worse for renters?

LotharIngum · 13-12-2018 7:12pm #1

This would probably be better as a poll.

Now that it has been shown that rental supply is dwindling and rents are going up and up and up and landlords are leaving the sphere, does anyone actually think that rent controls are working or are have they made the rental issues worse?

Dinarius · 13-12-2018 7:56pm

Well, take the evil landlords out of the equation and people either live with their parents or buy a house; period.

Sometimes I wonder if it is forgotten that landlords are the *only* middle-ground. Without them, our homeless crisis would be multiples of what it is.

I suspect that ever increasing legislation in favour of the tenant, coupled with a very heady property market (in what are unpredictable times) are two of the reasons that many landlords have had enough and are bailing out.

I fully understand legislation regarding minimum requirements in lettings. But, RPZs and 4% limits on rent increases barely keep pace with inflation. There is a middle-ground, but is this it? The market doesn’t seem to think so.

D.

mrslancaster · 13-12-2018 7:58pm

Imo it is not just the rent controls that are causing less supply.

If you were a small landlord and read the proposed anti eviction bill or other similar changes on the way, imo it would make you think about leaving the sector.

More landlords are needed to provide houses to rent but too much uncertainty and constant changes makes everyone nervous. it's hard to keep up with all the regulations and it's not good for tenants if rental supply is reduced again.

Maybe the government should try to encourage more landlords instead of the current approach.

Andycap8 · 13-12-2018 8:00pm

I don't think there's any way to tell if they're a good or bad thing. They're obviously a good thing for existing tenants.

The lack of rental supply growth is largely due to a wider lack of total new supply overall.

At Q3 there were 339,117 tenancies registered, which is only down 0.6% on Q3 2017. Similarly, the number of landlords is only down 1.6% over the same period.

RTB figures below
https://onestopshop.rtb.ie/images/uploads/Registration/Reg_Q3_2018.pdf

matrim · 13-12-2018 8:01pm

What isn't helping is this piecemeal tweaking every year. Neither tenants or landlords have any stability. They should look at a full review that priortises long term stable tenancies and allows landlords to remove people who don't pay

Den14 · 13-12-2018 8:04pm

Those horrible landlords are the baddies. Tax them to the hilt then slap a ton of regulations on top of that. That'll learn 'em.... *Sarcasm

antoinolachtnai · 13-12-2018 8:45pm

It is good for people who have adequate rental accommodation.

It is on the whole bad for people who don’t.

Wheres Me Jumper? · 13-12-2018 9:21pm

RTE reported that whilst rents were still rising, the pace of increase has slowed down.
Also the number of LLs has fallen.

There are 1,778 fewer landlords than there were three years ago, while tenancies have declined by 8,829.

https://www.rte.ie/news/2018/1213/1016879-rent_index/

Wheres Me Jumper? · 13-12-2018 9:22pm

Den14 wrote: »

Those horrible landlords are the baddies. Tax them to the hilt then slap a ton of regulations on top of that. That'll learn 'em.... *Sarcasm

it's ok Eoghan, we know it's you.

LotharIngum · 13-12-2018 9:56pm

With all of the current legislation and the bills and changes being scoped out now,
Im thinking we are going to see a move from houses and large apartments to one or two bed apartments.
REITs will take over and as such it will only be manageable apartments for rent in future.
I think houses for rent are going to dwindle and are already.
Smaller apartments may hang on for a little while, but they are going too.
God help anyone who has to move now. They are in for a shock, especially families in houses.

theboringfox · 13-12-2018 11:01pm

Better Short Term and ii already renting.
Bad long term and in particular if looking to rent.

If you want more investment in a sector you don't disincentive investment there.

Wheres Me Jumper? · 13-12-2018 11:06pm

LotharIngum wrote: »

With all of the current legislation and the bills and changes being scoped out now,
Im thinking we are going to see a move from houses and large apartments to one or two bed apartments.
REITs will take over and as such it will only be manageable apartments for rent in future.
I think houses for rent are going to dwindle and are already.
Smaller apartments may hang on for a little while, but they are going too.
God help anyone who has to move now. They are in for a shock, especially families in houses.

i agree. every time the Govt. interferes in the housing market they just make a bad situation worse. every bit of extra regulation simply confuses and discourages people.

eg the removal of bedsits was so badly thought through. plenty of tenants (many possibly now homeless) were perfectly happy in them. they didn't need or want a yuppie apartment. most couldn't afford one tbh.

An_Toirpin · 14-12-2018 12:27am

Andycap8 wrote: »

I don't think there's any way to tell if they're a good or bad thing. They're obviously a good thing for existing tenants.

The lack of rental supply growth is largely due to a wider lack of total new supply overall.

At Q3 there were 339,117 tenancies registered, which is only down 0.6% on Q3 2017. Similarly, the number of landlords is only down 1.6% over the same period.

RTB figures below
https://onestopshop.rtb.ie/images/uploads/Registration/Reg_Q3_2018.pdf

You could look at how the price of renting is at all time highs while the cost of buying is still well below 2007 and infer that its not driven by a lack of houses.

AlmightyCushion · 14-12-2018 1:52am

An_Toirpin wrote: »

You could look at how the price of renting is at all time highs while the cost of buying is still well below 2007 and infer that its not driven by a lack of houses.

That would be due to a lack of credit. Back in the boom people could borrow a lot more than they can now and we were building a hell of a lot more back then as well. Back in the boom people were buying second and third houses on interest only and renting them out and then planning to sell the place when the interest only period was over and make a load of easy money. We don't have that now.

The_Conductor · 14-12-2018 7:41am

AlmightyCushion wrote: »

That would be due to a lack of credit. Back in the boom people could borrow a lot more than they can now and we were building a hell of a lot more back then as well. Back in the boom people were buying second and third houses on interest only and renting them out and then planning to sell the place when the interest only period was over and make a load of easy money. We don't have that now.

IS there a lack of credit though?
According to Central Bank figures- there were over 40,000 approvals in principle issued by Irish financial institutions in the 12 months to the end of September- that were allowed lapse.

The absolute issue is a lack of supply of residential dwellings- however, the rental sector is going the way of the dodo- and in future, will be limited to 1-2 bed apartments in centrally managed blocks. The renting a house of yore- is going to be seen as a quaint historic quirk. Good luck to anyone trying to find one in future.

Mitzy · 14-12-2018 9:43am

I am a landlord and consider myself to be a good one however because of the increased regulations etc I am selling up in 2019.
The rules & now potential criminalisation is simply scaring me off and I'm simply not willing to put myself at risk because the area is becoming very complex with ever changing rules.
I fear that in the long term renters will be in a much worse state because the large REITS will never show any mercy to tenants & don't care about the law's of the country.
This crisis will never be resolved for a long time to come.

Claw Hammer · 14-12-2018 1:09pm

The_Conductor wrote: »

IS there a lack of credit though?
According to Central Bank figures- there were over 40,000 approvals in principle issued by Irish financial institutions in the 12 months to the end of September- that were allowed lapse.

The absolute issue is a lack of supply of residential dwellings- however, the rental sector is going the way of the dodo- and in future, will be limited to 1-2 bed apartments in centrally managed blocks. The renting a house of yore- is going to be seen as a quaint historic quirk. Good luck to anyone trying to find one in future.

The amount lent by the banks on property or declining year on year. AIPs happen but when it comes to drawdown the banks act the maggot. The banks have no notion of actually giving out the amount of money approved. More money is coming in on repayments than is going out in loans where property is concerned. The European Central Bank wants the Irish banks to reduce their exposure to property. The result is that developers cannot get credit to build from the banks and people who get loan approval discover they can't find a property to purchase.

Del2005 · 14-12-2018 1:21pm

Den14 wrote: »

Those horrible landlords are the baddies. Tax them to the hilt then slap a ton of regulations on top of that. That'll learn 'em.... *Sarcasm

Only the small private landlord with a few properties stuck in an RPZ are the baddies.

The REITs releasing new rentals at the top of the market , rent is capped at 4% for any previously rented property so it has to be new releases driving the >4% increase, and gaining from the higher rent and near zero tax are the darlings.

Wheres Me Jumper? · 14-12-2018 1:54pm

Del2005 wrote: »

Only the small private landlord with a few properties stuck in an RPZ are the baddies.

The REITs releasing new rentals at the top of the market , rent is capped at 4% for any previously rented property so it has to be new releases driving the >4% increase, and gaining from the higher rent and near zero tax are the darlings.

why do we always love discriminating in favour of foreigners in this country?
local Irish LLs are providing a valuable service, yet the Govt. loves to hammer us, while vulture funds get tax break after tax break.
Irish begrudgery even at the top echelons of Govt. it seems...

Tar.Aldarion · 14-12-2018 4:08pm

Dinarius wrote: »

Well, take the evil landlords out of the equation and people either live with their parents or buy a house; period.

Sometimes I wonder if it is forgotten that landlords are the *only* middle-ground. Without them, our homeless crisis would be multiples of what it is.

I suspect that ever increasing legislation in favour of the tenant, coupled with a very heady property market (in what are unpredictable times) are two of the reasons that many landlords have had enough and are bailing out.

I fully understand legislation regarding minimum requirements in lettings. But, RPZs and 4% limits on rent increases barely keep pace with inflation. There is a middle-ground, but is this it? The market doesn’t seem to think so.

D.

Rents are higher than they have ever been and inflation is really low, certainly nowhere near 4%, it's been effectively 0 or negative for the last 6 years. This year it went up a bit and still is well below 1%. Compare a 4% increase yearly over those 6 years. Property price is still laughably low compared to London where rents are comparable to here. My brothers apartment rents for the same rate as here and is worth far far more than a similar apartment here, so returns are far worse than here. It's a great time to be a landlord here from that perspective. The only reason people could be leaving is if the laws on overstaying and things bite them on the ass.

robp · 14-12-2018 5:24pm

Wheres Me Jumper? wrote: »

why do we always love discriminating in favour of foreigners in this country?
local Irish LLs are providing a valuable service, yet the Govt. loves to hammer us, while vulture funds get tax break after tax break.
Irish begrudgery even at the top echelons of Govt. it seems...

REITs are shells that buy property and act as landlords. Many are public companies and anyone can buy their shares. When people actually receive their profits it is taxed.

The_Conductor · 14-12-2018 5:50pm

robp wrote: »

REITs are shells that buy property and act as landlords. Many are public companies and anyone can buy their shares. When people actually receive their profits it is taxed.

In theory. In practice the holdings in REITs are structured such that the vast preponderance of holders are not liable for tax- indeed, a not insignificant number of holders are purely nominees in various autonomous British tax jurisdictions. Several posters in this forum have already outlined how they have helped set up this structure for several clients in the recent past. If you go back a little to the Panama revelations- there are significant REIT holdings in the arrangements documented..........

Its all well and good to suppose the disbursements are taxed in the jurisdiction in which the holder is resident- but in a not insignificant number of cases- this simply is not the case........

AlmightyCushion · 14-12-2018 5:57pm

The_Conductor wrote: »

In theory. In practice the holdings in REITs are structured such that the vast preponderance of holders are not liable for tax- indeed, a not insignificant number of holders are purely nominees in various autonomous British tax jurisdictions. Several posters in this forum have already outlined how they have helped set up this structure for several clients in the recent past. If you go back a little to the Panama revelations- there are significant REIT holdings in the arrangements documented..........

Its all well and good to suppose the disbursements are taxed in the jurisdiction in which the holder is resident- but in a not insignificant number of cases- this simply is not the case........

And if these people owned property directly instead of investing in a REIT, they'd be able to do the exact same thing.

The_Conductor · 14-12-2018 5:59pm

AlmightyCushion wrote: »

And if these people owned property directly instead of investing in a REIT, they'd be able to do the exact same thing.

Yup. And some of the wealthiest people in Irish society do just this.

AlmightyCushion · 14-12-2018 6:00pm

The_Conductor wrote: »

Yup. And some of the wealthiest people in Irish society do just this.

So, REITs don't offer these people any advantage tax wise over being a normal landlord.

14-12-2018 6:06pm

LotharIngum wrote: »

This would probably be better as a poll.

Now that it has been shown that rental supply is dwindling and rents are going up and up and up and landlords are leaving the sphere, does anyone actually think that rent controls are working or are have they made the rental issues worse?

It's not the rent control, its how they were implemented. What they should have done was a rent freeze, and say something like "What your rent was at midnight last night will stay the same for 2 years". Instead, they announced they "would be bringing in a cap of 4% in the next couple of weeks". The result? I got a text the next day saying my rent was going up by 12%. Then a year later, my rent went up a further 4% in line with the regulations.

The_Conductor · 14-12-2018 6:10pm

AlmightyCushion wrote: »

So, REITs don't offer these people any advantage tax wise over being a normal landlord.

They insulate people from dealing with the nitty gritty of being a landlord- while making it far easier to obsfusciate the ultimate ownership of the REIT shares. It used to be the case that you could handily incorporate an office in Jersey, with bank accounts there, or in the Isle of Man- and presto- you were untouchable- hell, boilerplate outfits were even common in Dublin once upon a time- have a look in the classified section of Time Magazines from the 1980s- it was the wild wild west here- every bit as bad as the channel islands. Its far easier to hide the ownership of shares- by use of nominated owners- than it is a full property- thanks to the crackdown on tax evasion that has gathered pace here over the last 12 years- however, not every jurisdiction has had the same success in dealing with evasion, as Ireland has done (and even Ireland is managing to bring in vast sums that it had no idea existed- equal to nearly a quarter a billion in 2017).

Tax avoidance and tax evasion- are legal and illegal- however, they get murkied terribly and one often encroaches from legal territory into illegal actions.......... There are whole industries based on people minimising their payable tax- not all those involved in those industries are necessarily only looking at 'legal' options..............

Claw Hammer · 14-12-2018 6:44pm

Deleted User wrote: »

It's not the rent control, its how they were implemented. What they should have done was a rent freeze, and say something like "What your rent was at midnight last night will stay the same for 2 years". Instead, they announced they "would be bringing in a cap of 4% in the next couple of weeks". The result? I got a text the next day saying my rent was going up by 12%. Then a year later, my rent went up a further 4% in line with the regulations.

a text is not a adequate notice of a rent increase. you should have objected.

AlmightyCushion · 14-12-2018 7:01pm

The_Conductor wrote: »

They insulate people from dealing with the nitty gritty of being a landlord- while making it far easier to obsfusciate the ultimate ownership of the REIT shares. It used to be the case that you could handily incorporate an office in Jersey, with bank accounts there, or in the Isle of Man- and presto- you were untouchable- hell, boilerplate outfits were even common in Dublin once upon a time- have a look in the classified section of Time Magazines from the 1980s- it was the wild wild west here- every bit as bad as the channel islands. Its far easier to hide the ownership of shares- by use of nominated owners- than it is a full property- thanks to the crackdown on tax evasion that has gathered pace here over the last 12 years- however, not every jurisdiction has had the same success in dealing with evasion, as Ireland has done (and even Ireland is managing to bring in vast sums that it had no idea existed- equal to nearly a quarter a billion in 2017).

Tax avoidance and tax evasion- are legal and illegal- however, they get murkied terribly and one often encroaches from legal territory into illegal actions.......... There are whole industries based on people minimising their payable tax- not all those involved in those industries are necessarily only looking at 'legal' options..............

You're sidestepping the point there. If someone can structure their tax affairs in a way that they can avoid the tax from the income they receive from a REIT, then they can do the same for the income they receive from a rental property. If a normal person like you or me invests in a REIT we will end up paying tax on the income just like we would on the income from a rental property. You're saying REITs have an unfair advantage over landlords because REITs don't pay tax but that isn't the case. Wealthy individuals who can structure their affairs in a way that avoids tax have an unfair advantage but that has nothing to do with REITs as they will reduce their tax burden whether the income is from a REIT or a rental property.

Dinarius · 14-12-2018 7:40pm

[Deleted User] wrote: »

It's not the rent control, its how they were implemented. What they should have done was a rent freeze, and say something like "What your rent was at midnight last night will stay the same for 2 years". Instead, they announced they "would be bringing in a cap of 4% in the next couple of weeks". The result? I got a text the next day saying my rent was going up by 12%. Then a year later, my rent went up a further 4% in line with the regulations.

And those landlords who were locked into a lease found themselves caught out by the suddenness of it and, in some cases (me included) have never been able to catch up. (We own a purpose built one-bed apartment in Dublin 6 let for €1250 p/m. Check out Daft or MyHome and see a. How many one-beds there are to let in the whole of Dublin 6 and... b. What can you get for €1250?)

Hence the huge temptation in this heady property market to say, bu**er it, and sell.

I’m not sure what the solution is; but, what we have doesn’t seem to be working.

D.

Wheres Me Jumper? · 14-12-2018 8:21pm

AlmightyCushion wrote: »

And if these people owned property directly instead of investing in a REIT, they'd be able to do the exact same thing.

sure but your average Irish LL with a few apartments is highly unlikely to go down that route.

The_Conductor · 14-12-2018 8:54pm

Wheres Me Jumper? wrote: »

sure but your average Irish LL with a few apartments is highly unlikely to go down that route.

The average Irish landlord (58% of landlords)- has 1 unit. A further 28% of landlords have 2 units. Only 14% of landlords have more than 2. Source RTB annual report.

alias no.9 · 14-12-2018 9:00pm

I'm a landlord, a single property former PPR, in an RPZ. I did my sums a few months back when our tenants of nearly 5 years moved out and decided to let again. The rent hadn't been reviewed in more than 3 years and the RPZ rules punish you in perpetuity if you don't set it to the maximum allowable so I didn't really have any other option so it'll feed the stats as an above the notionally allowed annual increase but it is in fact compliant with the law.

I didn't offer a fixed term lease because that would lock them in until after part IV kicks in. If things go ok for the six months, I'll have no problems with continuing into part IV but a 6 months getting to know you period before being tied to a 6 year term is not unreasonable. I don't even think the 6 year part IV term is in any way unreasonable, if part IV didn't exist, I'd probably prefer to be working with long fixed term leases, but there simply has to be some "no fault" exit for the landlord, as I said once every 6 years is probably sufficient.

Something had to be done to hold back rents and I'm reasonably ok with the RPZ apart from the fact that it can lock in two identical neighbouring properties at massively different rents which is unfair to the landlord in one house and the tenant in the other. I understand that was necessary to bring the rules in overnight but they've had more than enough time to bring in something better. New tenancies should be tied to a rent index for an area, not the previous rent, which should pull back the top end rents.

I'll now be watching this bill like a hawk as the part IV date looms in a few month. I won't be tied into an indefinite term with no provision for terminating a tenancy to sell the property in a scenario where banks won't offer a mortgage to prospective buyers without vacant possession. If the risk is hanging out there, I may just have to give them notice before part IV, something I wouldn't otherwise do. I'll keep it vacant until this is decided one way or the other, if it passes into law I'll be selling.

Wheres Me Jumper? · 14-12-2018 9:36pm

alias no.9 wrote: »

I'm a landlord, a single property former PPR, in an RPZ. I did my sums a few months back when our tenants of nearly 5 years moved out and decided to let again. The rent hadn't been reviewed in more than 3 years and the RPZ rules punish you in perpetuity if you don't set it to the maximum allowable so I didn't really have any other option so it'll feed the stats as an above the notionally allowed annual increase but it is in fact compliant with the law.

I didn't offer a fixed term lease because that would lock them in until after part IV kicks in. If things go ok for the six months, I'll have no problems with continuing into part IV but a 6 months getting to know you period before being tied to a 6 year term is not unreasonable. I don't even think the 6 year part IV term is in any way unreasonable, if part IV didn't exist, I'd probably prefer to be working with long fixed term leases, but there simply has to be some "no fault" exit for the landlord, as I said once every 6 years is probably sufficient.

Something had to be done to hold back rents and I'm reasonably ok with the RPZ apart from the fact that it can lock in two identical neighbouring properties at massively different rents which is unfair to the landlord in one house and the tenant in the other. I understand that was necessary to bring the rules in overnight but they've had more than enough time to bring in something better. New tenancies should be tied to a rent index for an area, not the previous rent, which should pull back the top end rents.

I'll now be watching this bill like a hawk as the part IV date looms in a few month. I won't be tied into an indefinite term with no provision for terminating a tenancy to sell the property in a scenario where banks won't offer a mortgage to prospective buyers without vacant possession. If the risk is hanging out there, I may just have to give them notice before part IV, something I wouldn't otherwise do. I'll keep it vacant until this is decided one way or the other, if it passes into law I'll be selling.

This bill you refer to, do you (or anybody else) have any more info on it?
i heard it being discussed on the radio with Fintan McNamara, but i was in the car and failed to take proper note.

seems like the Dept. is considering a proposal to end the practise of terminating a tenancy for purposes of sale or inhabitance by LL's relative. is that correct?
at what stage is the bill at?

maybe we need another thread to discuss it?

Dinarius · 14-12-2018 9:50pm

alias no.9 wrote: »

I didn't offer a fixed term lease because that would lock them in until after part IV kicks in. If things go ok for the six months, I'll have no problems with continuing into part IV but a 6 months getting to know you period before being tied to a 6 year term is not unreasonable. I don't even think the 6 year part IV term is in any way unreasonable, if part IV didn't exist, I'd probably prefer to be working with long fixed term leases, but there simply has to be some "no fault" exit for the landlord, as I said once every 6 years is probably sufficient....

I'll now be watching this bill like a hawk as the part IV date looms in a few month. I won't be tied into an indefinite term with no provision for terminating a tenancy to sell the property in a scenario where banks won't offer a mortgage to prospective buyers without vacant possession. If the risk is hanging out there, I may just have to give them notice before part IV, something I wouldn't otherwise do. I'll keep it vacant until this is decided one way or the other, if it passes into law I'll be selling.

I too am a one property landlord.

Current tenants started their 4th year (one year leases) in October.

What is the 6 year term to which you refer?

If we decided to sell next year (when their lease ends in September) are there any restrictions?

Thanks.

D.

The_Conductor · 14-12-2018 9:51pm

Dinarius wrote: »

I too am a one property landlord.

Current tenants started their 4 year (one year leases) in October.

What is the 6 year term to which you refer?

If we decided to sell next year (when their lease ends in September) are there any restrictions?

Thanks.

D.

The proposal is that you will have to give the tenants 6 months rent in a lumpsum if you wish to regain vacant possession of the property in order to sell it........... Alternatively- you can sell it, but it'll have a sitting tenant- and good luck to anyone who hopes to use it as a PPR- they will have to pay a commensurate sum to the tenant- and hope and pray that they then move (and why should they?)

Wheres Me Jumper? · 14-12-2018 9:53pm

The_Conductor wrote: »

The proposal is that you will have to give the tenants 6 months rent in a lumpsum if you wish to regain vacant possession of the property in order to sell it........... Alternatively- you can sell it, but it'll have a sitting tenant- and good luck to anyone who hopes to use it as a PPR- they will have to pay a commensurate sum to the tenant- and hope and pray that they then move (and why should they?)

time to get out i reckon.:eek:

Dinarius · 14-12-2018 10:05pm

The_Conductor wrote: »

The proposal is that you will have to give the tenants 6 months rent in a lumpsum if you wish to regain vacant possession of the property in order to sell it........... Alternatively- you can sell it, but it'll have a sitting tenant- and good luck to anyone who hopes to use it as a PPR- they will have to pay a commensurate sum to the tenant- and hope and pray that they then move (and why should they?)

Just to be clear; is that if I want to sell while they’re still within their lease?

Current lease is up September 30, 2019. If I gave them notice prior to this (30 days, 90 days?) would I still owe them 6 months rent, if the proposed law was in place?

Finally, is there a proposed period after which they’re entitled to this lump sum? E.g. would tenants who’d only been there one year be eligible?

Many thanks.

D.

4ensic15 · 14-12-2018 10:23pm

Dinarius wrote: »

Just to be clear; is that if I want to sell while they’re still within their lease?

Current lease is up September 30, 2019. If I gave them notice prior to this (30 days, 90 days?) would I still owe them 6 months rent, if the proposed law was in place?

Finally, is there a proposed period after which they’re entitled to this lump sum? E.g. would tenants who’d only been there one year be eligible?

Many thanks.

D.

The view of the RTb is that you cannot serve notice during a fixed term lease. Even on the present law you will have problems.

Dinarius · 14-12-2018 10:28pm

4ensic15 wrote: »

The view of the RTb is that you cannot serve notice during a fixed term lease. Even on the present law you will have problems.

Now I feel I’ve really taken my eye off the ball!

If you can’t serve notice during a lease, when can you serve notice?

For example, my tenants will be expecting to hear from me around September 30, usually to renew the lease.

Are you saying that it’s there decision whether the property continues to be occupied? Is it the case that I only regain possession if they choose to move out and not if I give notice?

Thanks again.

D.

alias no.9 · 14-12-2018 10:33pm

Dinarius wrote: »

Just to be clear; is that if I want to sell while they’re still within their lease?

Current lease is up September 30, 2019. If I gave them notice prior to this (30 days, 90 days?) would I still owe them 6 months rent, if the proposed law was in place?

Finally, is there a proposed period after which they’re entitled to this lump sum? E.g. would tenants who’d only been there one year be eligible?

Many thanks.

D.

Right now, once they have been tenants for 6 months or more, they have security of tenure for up to 6 years except for very limited circumstances, selling the property, you or a family member moving in, etc... in which case you give notice of increasing length depending on how long they've been there. If you start with a 1 year fixed contract right now without any break clause in the first six months, you're handing them 6 years out of the traps except for selling, moving in, etc...

The proposal is to shorten the initial 6 months to 2 months for them to acquire security of tenure and for that to be for life effectively. The only way to break the tenancy is to pay 6 months rent in compensation.

Fol20 · 14-12-2018 10:59pm

alias no.9 wrote: »

I'm a landlord, a single property former PPR, in an RPZ. I did my sums a few months back when our tenants of nearly 5 years moved out and decided to let again. The rent hadn't been reviewed in more than 3 years and the RPZ rules punish you in perpetuity if you don't set it to the maximum allowable so I didn't really have any other option so it'll feed the stats as an above the notionally allowed annual increase but it is in fact compliant with the law.

I didn't offer a fixed term lease because that would lock them in until after part IV kicks in. If things go ok for the six months, I'll have no problems with continuing into part IV but a 6 months getting to know you period before being tied to a 6 year term is not unreasonable. I don't even think the 6 year part IV term is in any way unreasonable, if part IV didn't exist, I'd probably prefer to be working with long fixed term leases, but there simply has to be some "no fault" exit for the landlord, as I said once every 6 years is probably sufficient.

Something had to be done to hold back rents and I'm reasonably ok with the RPZ apart from the fact that it can lock in two identical neighbouring properties at massively different rents which is unfair to the landlord in one house and the tenant in the other. I understand that was necessary to bring the rules in overnight but they've had more than enough time to bring in something better. New tenancies should be tied to a rent index for an area, not the previous rent, which should pull back the top end rents.

I'll now be watching this bill like a hawk as the part IV date looms in a few month. I won't be tied into an indefinite term with no provision for terminating a tenancy to sell the property in a scenario where banks won't offer a mortgage to prospective buyers without vacant possession. If the risk is hanging out there, I may just have to give them notice before part IV, something I wouldn't otherwise do. I'll keep it vacant until this is decided one way or the other, if it passes into law I'll be selling.

How about 4pc increase for existing tenants however if tenants leave you can set it at whatever rate you want. Current tenants can get a decent deal while ll are not snookered when they leave

tvjunki · 14-12-2018 11:00pm

Dinarius wrote: »

Now I feel I’ve really taken my eye off the ball!

If you can’t serve notice during a lease, when can you serve notice?

For example, my tenants will be expecting to hear from me around September 30, usually to renew the lease.

Are you saying that it’s there decision whether the property continues to be occupied? Is it the case that I only regain possession if they choose to move out and not if I give notice?

Thanks again.

D.

Just dont give a lease in September and the lease becomes a month by month lease and you have to work under the rules of the residental tenancies act that is there at the moment.

Keep any eye on the new rules and if this daft thing comes in where you have to give 6months rent the give statutory notice before it comes into law. Get the statutory declaration from rtb website and have it ready to give to the tenant. You need a peace commissioner to witness your signature. Make sure you work out how much notice you have to give from the start of the tenancy.
You will find the form here https://onestopshop.rtb.ie/forms-documents

Wheres Me Jumper? · 14-12-2018 11:15pm

alias no.9 wrote: »

Right now, once they have been tenants for 6 months or more, they have security of tenure for up to 6 years except for very limited circumstances, selling the property, you or a family member moving in, etc... in which case you give notice of increasing length depending on how long they've been there. If you start with a 1 year fixed contract right now without any break clause in the first six months, you're handing them 6 years out of the traps except for selling, moving in, etc...

The proposal is to shorten the initial 6 months to 2 months for them to acquire security of tenure and for that to be for life effectively. The only way to break the tenancy is to pay 6 months rent in compensation.

on first viewing this proposal does seem very draconian, but i might not be so adverse to it if there is included in the Bill a fast-track means (with teeth) to evict non-paying &/or anti-social tenants.

i mean if i have a good tenant and he wants to stay in my property for 10, 15, or 20 years, so long as he pays his rent and doesn't cause issues, then personally i don't have a problem with that.

if fact i would argue why would any LL have a problem with a paying tenant, who wants to stay long-term?

alias no.9 · 14-12-2018 11:31pm

Fol20 wrote: »

How about 4pc increase for existing tenants however if tenants leave you can set it at whatever rate you want. Current tenants can get a decent deal while ll are not snookered when they leave

It's reasonable to limit the increase on sitting tenants tenants they need certainty, I'd never be in a hurry to increase the rent with sitting tenants if they were looking after the place and always up to date with the rent.

For new tenants, some level of sanity must be maintained or something is going to blow and **** knows what other parts of the economy it takes with it. The current system where one property is fixed at one rent and the identical next door neighbor can charge twice that rent is nonsense.

If there's going to be a rent index, it should be the benchmark for new tenancies, maybe with a bit of leniency for energy efficiency or standard of fixtures and fittings, but its time to finish with the previous rent baseline. The current system doesn't even allow for a landlord to reduce the rent short term if the tenant is hit with some short term problems because that then becomes the baseline for all future tenancies, even if that tenant moves on.

Maybe the tax system should be reformed so that the rates are based on percentiles of the rent index?

There's lots of options that would see landlords of similar properties treated the same and also tenants of similar properties treated the same.

Fol20 · 14-12-2018 11:35pm

alias no.9 wrote: »

It's reasonable to limit the increase on sitting tenants tenants they need certainty, I'd never be in a hurry to increase the rent with sitting tenants if they were looking after the place and always up to date with the rent.

For new tenants, some level of sanity must be maintained or something is going to blow and **** knows what other parts of the economy it takes with it. The current system where one property is fixed at one rent and the identical next door neighbor can charge twice that rent is nonsense.

If there's going to be a rent index, it should be the benchmark for new tenancies, maybe with a bit of leniency for energy efficiency or standard of fixtures and fittings, but its time to finish with the previous rent baseline. The current system doesn't even allow for a landlord to reduce the rent short term if the tenant is hit with some short term problems because that then becomes the baseline for all future tenancies, even if that tenant moves on.

Maybe the tax system should be reformed so that the rates are based on percentiles of the rent index?

There's lots of options that would see landlords of similar properties treated the same and also tenants of similar properties treated the same.

Honestly. Taxation should be the same as people that work normal jobs. Why should i as a landlord earn more for the same person that works. In any rate. Im always of the opinion that the markwt should dictate the cost and not the government impeding it.

alias no.9 · 14-12-2018 11:44pm

Wheres Me Jumper? wrote: »

on first viewing this proposal does seem very draconian, but i might not be so adverse to it if there is included in the Bill a fast-track means (with teeth) to evict non-paying &/or anti-social tenants.

i mean if i have a good tenant and he wants to stay in my property for 10, 15, or 20 years, so long as he pays his rent and doesn't cause issues, then personally i don't have a problem with that.

if fact i would argue why would any LL have a problem with a paying tenant, who wants to stay long-term?

A fast track eviction process for non payment or antisocial behaviour along would help. It would also help if a termination of tenancies was allowed in the instance of a sale to an owner occupant or perhaps keep the current clause on sale of the property but prohibit the the letting of the property to any other tenant for 2 years in instance the owner doesn't sell. I can recognise that there's spoofer landlords out there ending tenancies on the premise of selling but with no intention of selling but the current proposal is collective punishment rather than just targeting these spoofers.

alias no.9 · 14-12-2018 11:52pm

Fol20 wrote: »

Honestly. Taxation should be the same as people that work normal jobs. Why should i as a landlord earn more for the same person that works. In any rate. Im always of the opinion that the markwt should dictate the cost and not the government impeding it.

A rent index is a measure of the market. The taxation thing could be an additional levy on rents above a certain percentile of the rent index for a given area, it doesn't have to be a discount. It's about discouraging a run away rental market because it presents a danger to the economy, being a landlord doesn't preclude me from recognising that current trends are dangerous.

Wheres Me Jumper? · 14-12-2018 11:52pm

alias no.9 wrote: »

A fast track eviction process for non payment or antisocial behaviour along would help. It would also help if a termination of tenancies was allowed in the instance of a sale to an owner occupant or perhaps keep the current clause on sale of the property but prohibit the the letting of the property to any other tenant for 2 years in instance the owner doesn't sell. I can recognise that there's spoofer landlords out there ending tenancies on the premise of selling but with no intention of selling but the current proposal is collective punishment rather than just targeting these spoofers.

i agree. there are greedy & unscrupulous LLs who have been "turfing people out" on spurious grounds in order to hike rents, and this proposal does seem to be an attempt to stop that.

but as always seems to happen the Govt PBP. takes a sledgehammer to crack a nut, often with many unforeseen consequences, many of which adversly affect the very people they are trying to protect.

Fol20 · 14-12-2018 11:57pm

alias no.9 wrote: »

A rent index is a measure of the market. The taxation thing could be an additional levy on rents above a certain percentile of the rent index for a given area, it doesn't have to be a discount. It's about discouraging a run away rental market because it presents a danger to the economy, being a landlord doesn't preclude me from recognising that current trends are dangerous.

every other major city has these issues. The only way to address the rental sector specifically is to incentivise people to both stay in the market and have more people entering it. If you make it worse for ll, which this would do, it will have the opposite effect which in the end will negatively impact the renters.

alias no.9 · 15-12-2018 12:26am

Fol20 wrote: »

every other major city has these issues. The only way to address the rental sector specifically is to incentivise people to both stay in the market and have more people entering it. If you make it worse for ll, which this would do, it will have the opposite effect which in the end will negatively impact the renters.

The only fix is to build more. There is a short term risk until supply is brought on and I don't think it's unreasonable to try and reign in rent hikes until then and I don't think that is making things worse for landlords. Headline rents are not currently a problem for landlords, they're at or close to all time highs.

Risks to landlords are non payment and damage to the property or antisocial behaviour along with inability to secure legitimate possession of the property. If you can't see that these risks are exacerbated by a runaway rental market then I'm not sure I can help you.

This is made worse where the government sanctions a scenario where one landlord can charge twice as much as another for identical neighbouring properties. It's **** to be a tenant right now but it's often easier to deal with **** times when you feel you're in it together with your neighbors, with your peers. Bad behaviour often stems from grievances, perceived or real. If you find out your rent is way higher than your neighbour and what's more, the government says it's all above board, that grievance is probably real. How then do you then feel about your landlord, about the property? Do you respect either?

Are rent controls making things better or worse for renters?

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