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03-11-2019, 19:16   #61
the_syco
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Originally Posted by CalamariFritti View Post
I tend to agree with OP. Its a shoebox and people make it out as if 680 was nothing.
It has a double bed, so would suit a couple. Heck, it would suit a single person.

It's also the cheapest letting in Sligo.
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03-11-2019, 19:17   #62
Guy:Incognito
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Originally Posted by CalamariFritti View Post
I tend to agree with OP. Its a shoebox and people make it out as if 680 was nothing.

Yes its 'the market' and all that. But if such is the market that this is deemed 'grand' and 'normal' then there is a problem.
Presumably if you were selling a product or providing a service to earn your money youd keep the price as low as possible?
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03-11-2019, 19:19   #63
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Average wage here is €38k per year, this apartment would be 21% of that. Of course if you base that on net income, all LLs would look for high earners rather than an average wage.
Sorry, median income in Sligo is 38k per year is it? Presuming it is, 700 per month is close to 30% net. So the person earning the median national salary in Sligo would be delighted to pay 30% of their income on that place. Lol at the landlord looking for high earners. Sorry, if you're a high earner looking to rent that place, you'd need to re-evaluate what you're doing with your life!

Not sure why you're talking about Eastern block countries either. Of course markets are different, but Berlin is hardly Belgrade or Bucharest.

Honestly, nowhere is perfect, and Berlin has its issues, but one of the things they definitely have right is their attitude to property and housing. A big factor in why I moved here.
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03-11-2019, 19:30   #64
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Sorry, median income in Sligo is 38k per year is it? Presuming it is, 700 per month is close to 30% net. So the person earning the median national salary in Sligo would be delighted to pay 30% of their income on that place. Lol at the landlord looking for high earners. Sorry, if you're a high earner looking to rent that place, you'd need to re-evaluate what you're doing with your life!

Not sure why you're talking about Eastern block countries either. Of course markets are different, but Berlin is hardly Belgrade or Bucharest.

Honestly, nowhere is perfect, and Berlin has its issues, but one of the things they definitely have right is their attitude to property and housing. A big factor in why I moved here.
My reason for mentioning Eastern Bloc countries is that different economies and market conditions mean fluctuations in prices, it is pointless comparing them.

€38k is the national average wage, I would suspect net would be higher in Sligo than in say somewhere like Dublin due to the lower cost of living.

I’m not sure anyone is delighted to pay €680 on rent, but they be slightly happier than the person paying €1000, as another poster said, this appears to be the cheapest rental available.

One of the reasons Irish people prefer to own than rent is that the term of the mortgage usually elapses before you retire, so at the time of your life when income declines significantly, so to do your living expenses. If you rent, those costs increase at a time when earnings decrease. This is one of the problems which the German economy is facing, the Berliner 20-something’s of the 80s are now approaching retirement.
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03-11-2019, 19:37   #65
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I'm sure I'll regret the effort but, just to put things in perspective and show the op what the landlord is making charging that rip off rent, below is a reasonable estimation of costs assuming cost of apt is 70k, rent is actually paid and the tenants don't trash the place.

Rent 680x12=8160
Less
PRTB=90
LPT=90
Insurance=300
Agent fees 11%=898
Management fees=1000
Mortgage Interest (70k@4.5%)=3150
Life cover on mortgage=360
Annual maintenance=650
Accountant to file tax return=360
Phone and travel costs=250

Leaves a profit of 1012, eat of tax at higher rate, 606.

So the landlord is left with a net profit of 606, for taking a massive risk in providing a place for you to live!!

Just to put it into perspective
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03-11-2019, 19:41   #66
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I was in Berlin a couple of weeks ago, driving back to the airport through the student areas, I asked the taxi driver why there were so many derelict buildings, guess what he said, “ property too expensive, rents to low, so no building”

I knew I read that somewhere about new builds, I think it does not apply to anything built in the last 5 years but I’ll have to find the article.
There are many derelict buildings, but there's also lots of building going on. On my street there's a huge new development. Loads of building near where I work. Loads of repurposing of factories etc into housing. Cranes all over the skyline.

But definitely not enough housing currently and it's expensive to buy. Regularly 40 - 100 people turn up to property viewings.
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03-11-2019, 19:41   #67
Samuel T. Cogley
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Originally Posted by ABEasy View Post
I'm sure I'll regret the effort but, just to put things in perspective and show the op what the landlord is making charging that rip off rent, below is a reasonable estimation of costs assuming cost of apt is 70k, rent is actually paid and the tenants don't trash the place.

Rent 680x12=8160
Less
PRTB=90
LPT=90
Insurance=300
Agent fees 11%=898
Management fees=1000
Mortgage Interest (70k@4.5%)=3150
Life cover on mortgage=360
Annual maintenance=650
Accountant to file tax return=360
Phone and travel costs=250

Leaves a profit of 1012, eat of tax at higher rate, 606.

So the landlord is left with a net profit of 606, for taking a massive risk in providing a place for you to live!!

Just to put it into perspective

In fairness you haven't included equity gained in the profit calculation. Not that it'll change your very valid point.

Last edited by Samuel T. Cogley; 03-11-2019 at 20:40.
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03-11-2019, 19:42   #68
Samuel T. Cogley
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Originally Posted by pinksoir View Post
There are many derelict buildings, but there's also lots of building going on. On my street there's a huge new development. Loads of building near where I work. Loads of repurposing of factories etc into housing. Cranes all over the skyline.

But definitely not enough housing currently and it's expensive to buy. Regularly 40 - 100 people turn up to property viewings.

None of that is going to be covered by this rental freeze.
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03-11-2019, 19:43   #69
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Originally Posted by ABEasy
So the landlord is left with a net profit of 606, for taking a massive risk in providing a place for you to live!!

It's called an investment. Tennant is actually buying the property for the LL. There are very few investments where you pay out such a small amount of money for the return of investment over a 20 or thirty year period.
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03-11-2019, 19:46   #70
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So the landlord is left with a net profit of 606, for taking a massive risk in providing a place for you to live!!

AND ultimately an asset worth €70K plus inflation, paid off by those renting. And if some of that rent is done in cash, bobs your uncle.
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03-11-2019, 19:47   #71
Fritzbox
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Quote:
Originally Posted by ABEasy View Post
I'm sure I'll regret the effort but, just to put things in perspective and show the op what the landlord is making charging that rip off rent, below is a reasonable estimation of costs assuming cost of apt is 70k, rent is actually paid and the tenants don't trash the place.

Rent 680x12=8160
Less
PRTB=90
LPT=90
Insurance=300
Agent fees 11%=898
Management fees=1000
Mortgage Interest (70k@4.5%)=3150
Life cover on mortgage=360
Annual maintenance=650
Accountant to file tax return=360
Phone and travel costs=250

Leaves a profit of 1012, eat of tax at higher rate, 606.

So the landlord is left with a net profit of 606, for taking a massive risk in providing a place for you to live!!

Just to put it into perspective
How can you be so sure that there are agent or management fees or that the accountant fees even exist? And why would phone and travel costs be so high - they'd be negligible surely?
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03-11-2019, 19:49   #72
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One bed apartments are also going for €700 a month in Monaghan town. At least Sligo has an IT and large hospital.
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03-11-2019, 19:51   #73
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It's called an investment. Tennant is actually buying the property for the LL. There are very few investments where you pay out such a small amount of money for the return of investment over a 20 or thirty year period.
This is incorrect. The tenant is paying for his/her accommodation, not buying the property for the Landlord.

You are correct about it being an investment, and like all investments it’s value can go up and down, that is the risk you take, but again, the tenant does not buy the property for the LL.

I can’t think of another investment where gains are capped and where an entity like a tenant can stop paying for the service, and still legally get the benefit of it.
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03-11-2019, 19:58   #74
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How can you be so sure that there are agent or management fees or that the accountant fees even exist? And why would phone and travel costs be so high - they'd be negligible surely?
Management fees, it's an apartment, management company will own the freehold and owner will have a leasehold interest, costs of the building will be spread over the owners. As it's an apartment this is most likely probable.

Agent fees, assume this is a straight investment you'd have an agent manage it. If not price it the owners own time as opportunity cost and the increased risk of poor tenants and also the cost of letting.

Accountant, owner is obliged to file a tax return as income exceeds the limit to register. Landlord would not be required to file a return if he didn't have rent, this is an additional cost of being a landlord.

Phone & travel, I think this is very reasonable. Cost of actual phone, 2nd number, private number is a private number not a business number, travel at civil service mileage rate (incorporates vehicle, ins, tax, service, tryes, fuel).
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03-11-2019, 20:00   #75
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AND ultimately an asset worth €70K plus inflation, paid off by those renting. And if some of that rent is done in cash, bobs your uncle.
At 606 per annum, you'd own the asset in 115 years and 6 months.
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