Dublin - Significant reduction in rents coming?

sk8board · 07-05-2021 10:04am

Cuckoo funds now spending €53m on homes here every week

https://www.independent.ie/business/personal-finance/property-mortgages/cuckoo-funds-now-spending-53m-on-homes-here-every-week-40396197.html

As a landlord, I’ve always preferred the scenario where the market becomes more professional - which helps tenants, as the professional LL will follow the letter of the law, even if we disagree on some laws at least there’s certainty for both sides.

Meanwhile the accidental LLs, negative equity LLs
and older retiring LLs are all moving out of the market, which is great for the overall market.

Just a reminder again - 66% of all registered LLs have just one property (120,000 from 165,000).

Selling property estates en masse to Funds is good for the rental market - but bad for the owner occupier market.

TSQ · 07-05-2021 11:19am

There was a piece in the Herald yesterday about a woman (in her 40s?) who is worried sick about lack of security and looking towards a future where she repeatedly has to move as she gets older (she is having to move currently because the landlord is selling). She is single (at least, that is the impression in the article), and writes about not being able to start a family and not being able to afford to buy a house. She earned and spent in her 20s, by her own admission never saving or thinking of the future. I have a friend in a similar situation, and I think, to some extent, this is a trap many singletons get into. Most working couples, couples who start a family, and especially couples who get married, tend to start budgeting and saving with the aim of buying a home. Most singletons seem more inclined to live for the moment and don't worry about the future until it is too late. When I lived in bedsitland, all the older renters were single (mostly single men in fact), so nothing much has changed. There will always be these single people who miss the property bus, through their own lack of foresight or because of low income, and who, being single, won't easily qualify for social housing. Will the transition from small landlords to professionally run rental estates actually lead to less uncertainty and more security of tenure for these renters as they age? especially as the property funds switch from buying expensive, high rent, city centre apartments to buying up suburban developments where rents will be lower and long term leases available?

Yellow_Fern · 07-05-2021 12:01pm

TSQ wrote: »

There was a piece in the Herald yesterday about a woman (in her 40s?) who is worried sick about lack of security and looking towards a future where she repeatedly has to move as she gets older (she is having to move currently because the landlord is selling). She is single (at least, that is the impression in the article), and writes about not being able to start a family and not being able to afford to buy a house. She earned and spent in her 20s, by her own admission never saving or thinking of the future. I have a friend in a similar situation, and I think, to some extent, this is a trap many singletons get into. Most working couples, couples who start a family, and especially couples who get married, tend to start budgeting and saving with the aim of buying a home. Most singletons seem more inclined to live for the moment and don't worry about the future until it is too late. When I lived in bedsitland, all the older renters were single (mostly single men in fact), so nothing much has changed. There will always be these single people who miss the property bus, through their own lack of foresight or because of low income, and who, being single, won't easily qualify for social housing. Will the transition from small landlords to professionally run rental estates actually lead to less uncertainty and more security of tenure for these renters as they age? especially as the property funds switch from buying expensive, high rent, city centre apartments to buying up suburban developments where rents will be lower and long term leases available?

It is very unpleasant to think about. Someone needs to tells these kids to invest as soon as they turn 18 even in whatever drips and drabs they can manage.

yagan · 07-05-2021 12:10pm

TSQ wrote: »

There was a piece in the Herald yesterday about a woman (in her 40s?) who is worried sick about lack of security and looking towards a future where she repeatedly has to move as she gets older (she is having to move currently because the landlord is selling). She is single (at least, that is the impression in the article), and writes about not being able to start a family and not being able to afford to buy a house. She earned and spent in her 20s, by her own admission never saving or thinking of the future. I have a friend in a similar situation, and I think, to some extent, this is a trap many singletons get into. Most working couples, couples who start a family, and especially couples who get married, tend to start budgeting and saving with the aim of buying a home. Most singletons seem more inclined to live for the moment and don't worry about the future until it is too late. When I lived in bedsitland, all the older renters were single (mostly single men in fact), so nothing much has changed. There will always be these single people who miss the property bus, through their own lack of foresight or because of low income, and who, being single, won't easily qualify for social housing. Will the transition from small landlords to professionally run rental estates actually lead to less uncertainty and more security of tenure for these renters as they age? especially as the property funds switch from buying expensive, high rent, city centre apartments to buying up suburban developments where rents will be lower and long term leases available?

It raises an interesting question about how tradition mortgage backed debt created a negative feedback loop as families got smaller, extending to the point where being single becomes the norm rather than the exception.

mrslancaster · 07-05-2021 2:31pm

Yellow_Fern wrote: »

It is very unpleasant to think about. Someone needs to tells these kids to invest as soon as they turn 18 even in whatever drips and drabs they can manage.

Something my great grandparents instilled in their kids & it came down the generations to my entire family. Most important thing was to own your home however modest it was. Holidays, cars, etc etc always came second. It was probably a hangover from their own grandparents time when people could lose their homes through eviction by absentee landlords. It is very specific to the Irish psyche & one of the reasons we have high rates of home ownership imo. I lived in a few other countries & found a different attitude to renting, even in the UK it was more common for people to rent for life.

Unfortunately anyone who wants to buy now faces major difficulties and competition from AHB's, councils & cuckoo funds. Renting for life sounds like a really bad idea to me because I think as people get older or lose work or become ill then the reality of renting for the rest of your life hits home.
Paying a mortgage for 25 years may be a better option if at all possible even if it's for a property farther away from your preferred area or current job. Over time jobs change, public transport improves, salaries increase & repayments become easier.
If you can buy, you will not lose your home e.g. Renters are vulnerable when a landlord sells up or hikes the rent up or the council suddenly changes the rules & your 3 bed family home no longer suits as your kids have flown the nest. Renting & freedom to move around is great in your 20's but not the uncertainty & ever increasing monthly outgoings as we get older. Just my two cents.

mrslancaster · 07-05-2021 2:48pm

Private renters facing difficulties or homelessness in future due to getting older & reduced income is something nobody in government seems to be thinking about let alone planning for. For example, if a
30/40 year old is paying high monthly rent now, how much will they be able to afford when they retire if they have to rely on the state pension? Will their current landlord even be still around? How many times will they have moved by then etc etc
it's something that needs to be discussed.

Amadan Dubh · 07-05-2021 3:48pm

mrslancaster wrote: »

Private renters facing difficulties or homelessness in future due to getting older & reduced income is something nobody in government seems to be thinking about let alone planning for. For example, if a
30/40 year old is paying high monthly rent now, how much will they be able to afford when they retire if they have to rely on the state pension? Will their current landlord even be still around? How many times will they have moved by then etc etc
it's something that needs to be discussed.

Hole them up in the co-living blocks when they're old. That is the long term plan of FFG!

C14N · 07-05-2021 5:23pm

mrslancaster wrote: »

Unfortunately anyone who wants to buy now faces major difficulties and competition from AHB's, councils & cuckoo funds. Renting for life sounds like a really bad idea to me because I think as people get older or lose work or become ill then the reality of renting for the rest of your life hits home.
Paying a mortgage for 25 years may be a better option if at all possible even if it's for a property farther away from your preferred area or current job. Over time jobs change, public transport improves, salaries increase & repayments become easier.
If you can buy, you will not lose your home e.g. Renters are vulnerable when a landlord sells up or hikes the rent up or the council suddenly changes the rules & your 3 bed family home no longer suits as your kids have flown the nest. Renting & freedom to move around is great in your 20's but not the uncertainty & ever increasing monthly outgoings as we get older. Just my two cents.

The attitude to homeowning in Ireland is a mixture of being rational and irrational imo. It's rational in the sense that our own market is setup in a way where renting for life really just isn't very viable. It's much cheaper to buy than rent, all else being equal, and it's a major asset to have. In addition, trying to pay for our high rates of rent on a pension is something that is extremely difficult.

It's irrational in the sense that we and our politicians seem to be unable to envision a society where this is not the case, even though as you say, renting for life is something that is already done far more successfully in other countries and is completely feasible there. I also think we have some other irrationalities, like a sort of ingrained bias toward paying off mortgages early, even when it's not really a financially smart move (since the money used to pay off earlier could usually be used more effectively elsewhere), because people fear any debt.

I don't think it's a great tradeoff though. Moving further away from your work and social life has many negative outcomes. Research has shown that longer commutes, especially by car, have significant negative impacts on stress and mental wellbeing. It's true jobs may change and public transport may improve, but in general new jobs and public transport will all be concentrated in urban areas which are the things you often have to move away from to be able to buy property.

It's also not fully correct to say buying means you'll never lose your home. Or at least, not until the mortgage is paid off, which even on a short mortgage, is often 20-25 years. It's not likely, but you can still be evicted from your house if you fall on bad times. Another risk is that your home may lose value and make it harder to move, which as we saw in the last economic crash, was a real problem for many people. It's bad enough to lose employment, but it's even worse if you can't leave to look for it abroad, or elsewhere in the country, because you can't sell your house. If you buy a house in a place that becomes less in demand, you may end up saddled with it and be unable to sell, even if you want to move elsewhere to chase a job or opportunities. That's one of my personal biggest fears as a person looking to buy for the first time on a budget now.

And for single people (like mentioned in the article above), buying is sadly just not really feasible for most unless you have a very well-paying job. Even on a good salary of maybe €60k per year, your limit on what you can buy is just a €210k without an exception, and that doesn't go far in today's market even if you do save up the deposit for it.

sk8board · 07-05-2021 8:57pm

TSQ wrote: »

Will the transition from small landlords to professionally run rental estates actually lead to less uncertainty and more security of tenure for these renters as they age? especially as the property funds switch from buying expensive, high rent, city centre apartments to buying up suburban developments where rents will be lower and long term leases available?

Well they’ll have certainty that things like an accidental LL moving back in themselves wouldn’t happen, and the maintenance would get done etc etc.

Where the Irish system falls down is that we have no legal facility for a lifetime renter. This is mainly because the level of accidental landlords here means that most of those properties will exit the market eventually, either selling the house or moving back in.

Europe is full of countries with lifelong leases, index linked to inflation, in professional landlord markets.

Imagine the Gov went to the Fund who bought that estate last week and told them they’d rent it all from them, on lifetime leases for specific tenants, index linked to inflation.

fixed income Pension Fund buyers would bite your hand off.

Yyhhuuu · 09-05-2021 12:49pm

sk8board wrote: »

Well they’ll have certainty that things like an accidental LL moving back in themselves wouldn’t happen, and the maintenance would get done etc etc.

Where the Irish system falls down is that we have no legal facility for a lifetime renter. This is mainly because the level of accidental landlords here means that most of those properties will exit the market eventually, either selling the house or moving back in.

Europe is full of countries with lifelong leases, index linked to inflation, in professional landlord markets.

Imagine the Gov went to the Fund who bought that estate last week and told them they’d rent it all from them, on lifetime leases for specific tenants, index linked to inflation.

fixed income Pension Fund buyers would bite your hand off.

Housing bodies ( I.e. the government) are already buying large amounts of houses in new private housing estates.

Ray Palmer · 10-05-2021 5:03pm

C14N wrote: »

The attitude to homeowning in Ireland is a mixture of being rational and irrational imo. It's rational in the sense that our own market is setup in a way where renting for life really just isn't very viable. It's much cheaper to buy than rent, all else being equal, and it's a major asset to have. In addition, trying to pay for our high rates of rent on a pension is something that is extremely difficult.

It's irrational in the sense that we and our politicians seem to be unable to envision a society where this is not the case, even though as you say, renting for life is something that is already done far more successfully in other countries and is completely feasible there. I also think we have some other irrationalities, like a sort of ingrained bias toward paying off mortgages early, even when it's not really a financially smart move (since the money used to pay off earlier could usually be used more effectively elsewhere), because people fear any debt.

I don't think it's a great tradeoff though. Moving further away from your work and social life has many negative outcomes. Research has shown that longer commutes, especially by car, have significant negative impacts on stress and mental wellbeing. It's true jobs may change and public transport may improve, but in general new jobs and public transport will all be concentrated in urban areas which are the things you often have to move away from to be able to buy property.

It's also not fully correct to say buying means you'll never lose your home. Or at least, not until the mortgage is paid off, which even on a short mortgage, is often 20-25 years. It's not likely, but you can still be evicted from your house if you fall on bad times. Another risk is that your home may lose value and make it harder to move, which as we saw in the last economic crash, was a real problem for many people. It's bad enough to lose employment, but it's even worse if you can't leave to look for it abroad, or elsewhere in the country, because you can't sell your house. If you buy a house in a place that becomes less in demand, you may end up saddled with it and be unable to sell, even if you want to move elsewhere to chase a job or opportunities. That's one of my personal biggest fears as a person looking to buy for the first time on a budget now.

And for single people (like mentioned in the article above), buying is sadly just not really feasible for most unless you have a very well-paying job. Even on a good salary of maybe €60k per year, your limit on what you can buy is just a €210k without an exception, and that doesn't go far in today's market even if you do save up the deposit for it.

This is where many people in Ireland don't pay attention to history and the consequences.

The reason other countries have good social housing is because they started in a place we didn't.WW I and II destroyed huge amounts of housing and killed many property owners and a portion of the population. I think in total Ireland had 4 bombs dropped on it in this time. One such drop destroyed a large section of North Strand in Dublin. That site became social housing.
Other countries were mostly destroyed. When reparations and economic plans were made. That included social housing at incredibly cheap prices and cheap long term investment. They didn't sell these properties and the funds allowed for more social housing to match the economy and growth.

The jesuits built our first social housing estates as they didn't like the government plans for "shared hallways". The government have sold the social housing stick and not invested further.

Do not blame the government because the public wanted to be able to buy these properties and it is very popular to this day.

If you suggest a OAP be moved out of a 3 bed council house and make room for a family people go crazy saying that is unfair. The children often buy the property due to the right to buy and make a profit.

Easy to blame the government but reality is they have never stood up properly against public views for the greater good. The vaguely tried with pension reductions and people went crazy. The majority of private landlords are pensioners. There is no joined up thinking on public opinion

salonfire · 10-05-2021 8:45pm

Amadan Dubh wrote: »

Hole them up in the co-living blocks when they're old. That is the long term plan of FFG!

And what's wrong with that as long it is affordable and of a decent standard?

Amadan Dubh · 10-05-2021 10:48pm

salonfire wrote: »

And what's wrong with that as long it is affordable and of a decent standard?

True, they'd be able to sit around the common room watching RTE and telling stories together, could get into the gym there, ride each other, cook stew and bake bread for each other; would be ideal for retiring.

Claw Hammer · 12-05-2021 2:25pm

The latest survey data seems to be that rents are rising again in Dublin. that is extraordinary given that the country was in lock down for that quarter. What will it be like when things open up and students return?

Jmc25 · 12-05-2021 5:39pm

Claw Hammer wrote: »

The latest survey data seems to be that rents are rising again in Dublin. that is extraordinary given that the country was in lock down for that quarter. What will it be like when things open up and students return?

It's very surprising and actually at odds with my own experience a couple of months ago in Dublin. I was looking mainly close to but not actually in the city centre. I looked at a couple of places a bit further out and there did seem to be more demand for those though, but hardly enough to push rents up even further, so quite surprised by this.

I should say though - I was offered a reduction on the asking rent on a few places. Most of them were then taken of Daft a few weeks later without the reduction which was offered to me being reflected in the asking rent.

JimmyVik · 13-05-2021 8:23am

Jmc25 wrote: »

It's very surprising and actually at odds with my own experience a couple of months ago in Dublin. I was looking mainly close to but not actually in the city centre. I looked at a couple of places a bit further out and there did seem to be more demand for those though, but hardly enough to push rents up even further, so quite surprised by this.

I should say though - I was offered a reduction on the asking rent on a few places. Most of them were then taken of Daft a few weeks later without the reduction which was offered to me being reflected in the asking rent.

At one point last year I decided to try and take advantage of the exodus from the city center and get a cheaper rent there.
I contacted so many agents and landlords and they were all 6 month leases.
Of the ones that engaged with me it was clear that they were prepared to wait it out for the pandemic to end if they didnt get the rent they were asking at the time.
At this point I think they will all be waiting until October 2021 before they start filling those places.

Browney7 · 13-05-2021 1:46pm

https://raycooke.ie/property/ballyfermot-drive-ballyfermot-dublin-10/

The rental market in Ballyfermot is strong! 2k per month for a two bed. No doubt it must be a palace inside since it's recently refurbished.

selassie · 13-05-2021 1:55pm

Browney7 wrote: »

https://raycooke.ie/property/ballyfermot-drive-ballyfermot-dublin-10/

The rental market in Ballyfermot is strong! 2k per month for a two bed. No doubt it must be a palace inside since it's recently refurbished.

3 people per bedroom and 3 in the living room at 400 a month each could get ya 3600 a month, landlord underselling it.

Phat Cat · 14-05-2021 9:16pm

Browney7 wrote: »

https://raycooke.ie/property/ballyfermot-drive-ballyfermot-dublin-10/

The rental market in Ballyfermot is strong! 2k per month for a two bed. No doubt it must be a palace inside since it's recently refurbished.

A quick Google search revels that house was bought for €250k earlier this year.

https://www.myhome.ie/residential/brochure/40-ballyfermot-drive-ballyfermot-dublin-10/4477869

They'd have a better chance knitting fog then getting €2k per month for that

Emma2019 · 15-05-2021 5:17pm

Weirdly doesn't seem to be on the PPR yet.

Unless theres something specificly wrong with that particular house I'd assume it went for 20k+ over asking based on houses in good nick nearby going for 40k+ over asking since about Nov 2020.

dalyboy · 15-05-2021 5:30pm

What with WFH becoming the possible long term norm who in their right mind will pay €2000 per month for a one bed apartment in Dublin ?

You can head to Navan or Dundalk etc and pay one third of that rip off asking price.

15-05-2021 8:52pm

dalyboy wrote: »

What with WFH becoming the possible long term norm who in their right mind will pay €2000 per month for a one bed apartment in Dublin ?

You can head to Navan or Dundalk etc and pay one third of that rip off asking price.

Many people want to live in Dublin, over Dundalk or Navan, for reasons other than work.....

dalyboy · 15-05-2021 11:10pm

Deleted User wrote: »

Many people want to live in Dublin, over Dundalk or Navan, for reasons other than work.....

If the average salary is netting €2500 per month and Dublin rent is €2000 per month (approaching approx for a 1 bed) that leaves €500 per month for bills, entertainment, savings and food etc.

They can want all they want tbh. That’s not a sustainable situation by a long stretch.

Ozark707 · 15-05-2021 11:16pm

dalyboy wrote: »

If the average salary is netting €2500 per month and Dublin rent is €2000 per month (approaching approx for a 1 bed) that leaves €500 per month for bills, entertainment, savings and food etc.

They can want all they want tbh. That’s not a sustainable situation by a long stretch.

For a 1 bed? Maybe a two bed?

PommieBast · 16-05-2021 1:14am

Ozark707 wrote: »

For a 1 bed? Maybe a two bed?

I'm paying 1800 for a 1-bed. I'm also out of the country once I have some loose ends tied up.

AlphabetCards · 16-05-2021 1:17am

PommieBast wrote: »

I'm paying 1800 for a 1-bed. I'm also out of the country once I have some loose ends tied up.

Do it. I couldn't bring myself to move home a few years ago because of it. I got a 5 bed with a huge garden here in the UK for £1000 a month with a gardener turning up weekly thrown in. Don't buy in to the Dublin rent farce if you can move.

Antho12 · 16-05-2021 6:54am

Deleted User wrote: »

Many people want to live in Dublin, over Dundalk or Navan, for reasons other than work.....

Finally someone mentioning this on here! People who rent in Dublin city are not always doing so because of work, most of them actually do want to live in Dublin.

dalyboy · 16-05-2021 8:40am

Ozark707 wrote: »

For a 1 bed? Maybe a two bed?

I’ve seen numerous examples of 1 bed apartments in the city for 2k plus per month.

Speaking only on 1 beds, in swords area and north co Dublin the rent can be €1800 approx. South side suburbs at least 2k per month.

dalyboy · 16-05-2021 8:51am

AlphabetCards wrote: »

Do it. I couldn't bring myself to move home a few years ago because of it. I got a 5 bed with a huge garden here in the UK for £1000 a month with a gardener turning up weekly thrown in. Don't buy in to the Dublin rent farce if you can move.

Couldn’t agree more.

A mate of mine (sadly split with his wife last year) was left to witness the horror of the prospect of renting in Dublin.

He went to see one property in Druncondra (1 bed apt) for €1500 pm. 450sft. The queue was down the street. He packed his bag , got on a plane to Malaga and hasn’t looked back. He’s paying €475 pm for a 3 bed penthouse near a marina.

The contrast is extraordinary for what you get here and elsewhere in both quality and price. Ireland clearly displays massive disfunction at fundamental level.

Thespoofer · 16-05-2021 8:56am

dalyboy wrote: »

Couldn’t agree more.

A mate of mine (sadly split with his wife last year) was left to witness the horror of the prospect of renting in Dublin.

He went to see one property in Druncondra (1 bed apt) for €1500 pm. 450sft. The queue was down the street. He packed his bag , got on a plane to Malaga and hasn’t looked back. He’s paying €475 pm for a 3 bed penthouse near a marina.

The contrast is extraordinary for what you get here and elsewhere in both quality and price. Ireland clearly displays massive disfunction at fundamental level.

Good for him.

Dublin - Significant reduction in rents coming?

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