Air BnB [and other platforms] to be effectively outlawed in high demand areas

runawaybishop · 08-11-2018 3:37pm

aloooof wrote: »

Whether they were originally designed as higher density or not, they're still not on the residential market currently.

Having them returned to the market, even as lower density residential property still adds to supply of residential property.

And that's if we accept your premises, which are at best, arguable.

The goal, as stated by the minister, was to return them to the long term rental market. What he has done, instead, is increased rents. Again.

aloooof · 08-11-2018 3:39pm

runawaybishop wrote: »

The goal, as stated by the minister, was to return them to the long term rental market.

From the short-term letting market. Net increase in supply to long-term, residential market.

CrabRevolution · 08-11-2018 4:07pm

runawaybishop wrote: »

The goal, as stated by the minister, was to return them to the long term rental market. What he has done, instead, is increased rents. Again.

Any rent increases will already have happened due to the scarcity created when the property was taken off the rental market to become an airbnb.

Can you explain how rents will rise because a property that's currently not being rented stays not being rented? In a simple model, rent is determined by supply and demand. For prices to rise like you claim, we'd need either increased demand or lower supply.

Changing an airbnb to a residential home doesn't affect supply since it wasn't being rented before and isn't being rented after so supply is constant. It doesn't affect demand either as the previous airbnb occupants were tourists not looking to rent, so it can't force prices up that way.

So, where does changing from airbnb to residential cause rent increases?

RayCun · 08-11-2018 4:56pm

runawaybishop wrote: »

Yeah, they came off the rental market already due to bad policies and now will leave it entirely.

This is just silly.

There are two ways things could go, from today

no restrictions on AirBnB
Restrictions on AirBnB

Suppose the govt says, "okay, changed our minds, we will not do anything about AirBnb"
Does this increase the supply of housing? No.
Does this reduce the supply of housing? Potentially, yes. Because private landlords take property out of the current rental market and put them up on AirBnB - because of the bad policies you are complaining about, because it is more profitable, whatever.

What if the govt goes ahead with this policy?
Does this reduce the supply of housing? No.
Does this increase the supply of housing? Yes. Because all of the properties on AirBnB go back into the market. Maybe some of them are sold instead of rented, but either way it is long-term accommodation that was not available before now.

TheChizler · 08-11-2018 6:02pm

runawaybishop wrote: »

The goal, as stated by the minister, was to return them to the long term rental market. What he has done, instead, is increased rents. Again.

So is your argument that increased supply means higher average prices?

Maybe what your saying is technically true, that they've been off the market so long they can be put back at market rates. The average across the whole market (including the new properties) might go up, but it's irrelevant as the average of the existing stock won't be affected. So what if the average rent goes up? It only affects people who move into these new properties.

Is that an argument against increasing supply? Keep supply low to keep the effective average rent the same?? There are people who are willing to move into new properties at the market rate, it wouldn't be the market rate otherwise. Are you saying that new properties shouldn't be introduced at market rates because it would increase some statistic, while in real life the effect will be entirely weighted to people in the new properties?

runawaybishop wrote: »

Yeah, they came off the rental market already due to bad policies and now will leave it entirely. Any that do go back to the rental market will be able to skip the rent cap if they have been on Airbnb for 2 years leading to, yes you guessed it, higher rents.

This assume the properties aren't just left empty for a while of course, if that happens it's even worse.

runawaybishop · 08-11-2018 8:11pm

CrabRevolution wrote: »

Any rent increases will already have happened due to the scarcity created when the property was taken off the rental market to become an airbnb.

Can you explain how rents will rise because a property that's currently not being rented stays not being rented? In a simple model, rent is determined by supply and demand. For prices to rise like you claim, we'd need either increased demand or lower supply.

Changing an airbnb to a residential home doesn't affect supply since it wasn't being rented before and isn't being rented after so supply is constant. It doesn't affect demand either as the previous airbnb occupants were tourists not looking to rent, so it can't force prices up that way.

So, where does changing from airbnb to residential cause rent increases?

Any that go back on the market after 2 years are exempt from the rental cap.

Anyone considering investing in rentals and increasing supply will see another interference in the market and just not bother.

runawaybishop · 08-11-2018 8:15pm

RayCun wrote: »

This is just silly.

There are two ways things could go, from today
no restrictions on AirBnB

Restrictions on AirBnB

Suppose the govt says, "okay, changed our minds, we will not do anything about AirBnb"
Does this increase the supply of housing? No.
Does this reduce the supply of housing? Potentially, yes. Because private landlords take property out of the current rental market and put them up on AirBnB - because of the bad policies you are complaining about, because it is more profitable, whatever.

What if the govt goes ahead with this policy?
Does this reduce the supply of housing? No.
Does this increase the supply of housing? Yes. Because all of the properties on AirBnB go back into the market. Maybe some of them are sold instead of rented, but either way it is long-term accommodation that was not available before now.

Sure, and realistically Airbnb should have been regulated properly long before this point. However, when landlords are exiting the market in droves punitive regulations don't help the situation. This regulation doesn't address the root cause of issue. It's just another populist and poorly thought out idea by a succession of ministers that will contribute to the lack of supply.

runawaybishop · 08-11-2018 8:18pm

TheChizler wrote: »

So is your argument that increased supply means higher average prices?

Maybe what your saying is technically true, that they've been off the market so long they can be put back at market rates. The average across the whole market (including the new properties) might go up, but it's irrelevant as the average of the existing stock won't be affected. So what if the average rent goes up? It only affects people who move into these new properties.

Is that an argument against increasing supply? Keep supply low to keep the effective average rent the same?? There are people who are willing to move into new properties at the market rate, it wouldn't be the market rate otherwise. Are you saying that new properties shouldn't be introduced at market rates because it would increase some statistic, while in real life the effect will be entirely weighted to people in the new properties?

As I have mentioned before my argument is that this regulation doesn't do what the minister claims it will do. It looks great in the newspapers though.

Even threshold have come out and said landlords are being screwed and threshold are the most pro-tenant organisation you will find.

Legislation that protects the landlord (speedily) from overholding tenants should be enacted along with, imo, longer tenancies and an escrow system..

CrabRevolution · 08-11-2018 8:25pm

runawaybishop wrote: »

Any that go back on the market after 2 years are exempt from the rental cap.

Anyone considering investing in rentals and increasing supply will see another interference in the market and just not bother.

But the 2 years is irrelevant when it's currently not on the market at all. It's better for someone to be living in it at any price than for it to not be lived in.

And unless the investors were going to build houses/apartments with that money, they weren't ever going to increase the supply of housing, just buy existing housing. On top of that, the only people who'll be put off by these regulations are investors who had intended on buying houses or apartments and renting them out entirely on airbnb. These investors were, again, doing nothing to increase supply. If anything they were reducing it.

TheChizler · 08-11-2018 8:25pm

runawaybishop wrote: »

As I have mentioned before my argument is that this regulation doesn't do what the minister claims it will do. It looks great in the newspapers though.

Well if you keep ignoring people's points that even if 100% of these properties are sold to owner occupiers it will free up a large number of rentals elsewhere you could make that argument. Even if 50% (a grossly exaggerated number IMO) of those buyers are coming straight from living with mammy and daddy it will have an impact.

The only way it will have zero impact is if the number of properties affected is equal to the sum of properties landlords are happy to leave empty plus first time entrants to the market who would have stayed home otherwise.

Fian · 12-11-2018 6:21pm

runawaybishop wrote: »

Any that go back on the market after 2 years are exempt from the rental cap.

Anyone considering investing in rentals and increasing supply will see another interference in the market and just not bother.

This is a common misconception. But a two year absence fromn teh market does not remove RPZ caps.

Properties that weren't rented in the two years before the RPZ came in are not subject to RPZ caps, properties that were rented during that period are subject to RPZ caps, regardless of whether they are subsequently taken off the market for 2 years or not.

There is nothing in the legislation that states that RPZ cap does not apply in respect of properties which have not been rented for 2 years. For such properties the rent cap is calculated at 4% per annum increase from the last time rent was set.

shenanagans · 12-11-2018 6:36pm

Fian wrote: »

This is a common misconception. But a two year absence fromn teh market does not remove RPZ caps.

Properties that weren't rented in the two years before the RPZ came in are not subject to RPZ caps, properties that were rented during that period are subject to RPZ caps, regardless of whether they are subsequently taken off the market for 2 years or not.

There is nothing in the legislation that states that RPZ cap does not apply in respect of properties which have not been rented for 2 years. For such properties the rent cap is calculated at 4% per annum increase from the last time rent was set.

If a landlord has a vacant property and ups the rent over 4%, the PRTB wont do a thing about it.

The RTB only investigate complaints from tenants. If the property is vacant there's no tenant to lodge a complaint.

Fian · 12-11-2018 6:44pm

shenanagans wrote: »

If a landlord has a vacant property and ups the rent over 4%, the PRTB wont do a thing about it.

The RTB only investigate complaints from tenants. If the property is vacant there's no tenant to lodge a complaint.

Unless the new tenant finds out what the old rent was, ofc you are correct. It is illegal to increase rent beyond RPZ caps but with a new tenant it is difficult to police/establish.

Claw Hammer · 12-11-2018 6:45pm

runawaybishop wrote: »

Any that go back on the market after 2 years are exempt from the rental cap.

Anyone considering investing in rentals and increasing supply will see another interference in the market and just not bother.

A 2 year break doesn't break the rent cap. A property that was being let within 2 years prior to the rent cap coming into force is always caught by it, no matter how long an interval there is between lettings. Once you let a rent cap in, it is impossible to get rid of it.

runawaybishop · 12-11-2018 8:07pm

Fian wrote: »

This is a common misconception. But a two year absence fromn teh market does not remove RPZ caps.

Properties that weren't rented in the two years before the RPZ came in are not subject to RPZ caps, properties that were rented during that period are subject to RPZ caps, regardless of whether they are subsequently taken off the market for 2 years or not.

There is nothing in the legislation that states that RPZ cap does not apply in respect of properties which have not been rented for 2 years. For such properties the rent cap is calculated at 4% per annum increase from the last time rent was set.

This is wrong, any property on Airbnb before Dec 2016 is exempt from the 4% per year rise as that is when the caps were introduced. Once they let it out they will be subject to the restrictions but can set what they want initially.

jd · 12-11-2018 8:15pm

Just back from SF, and the following was in the news

https://www.sfchronicle.com/business/article/SF-fines-Airbnb-landlords-2-25-million-for-13364513.php

Airbnb crime doesn’t pay.
That’s the message San Francisco wants to send after a well-heeled couple who turned 14 city apartments into illegal hotels through the vacation-rental service agreed to a $2.25 million settlement.

Darren and Valerie Lee agreed to pay that amount for penalties and investigation costs. In addition, they are barred for at least seven years from offering short-term rentals in any of the 17 San Francisco buildings they own or manage. The couple had to pledge their real estate as collateral to make sure they pay the fine and comply with the injunction, which was approved Monday in San Francisco Superior Court.

“The serious financial penalty is an important deterrent,” City Attorney Dennis Herrera said in a statement. “It sends a clear message to those looking to illegally profit off of San Francisco’s housing crisis: Don’t try it. We will catch you.”

Samuel T. Cogley · 12-11-2018 10:23pm

Surely this will come out in the wash once the rent amount register thinggy comes in or will that only publish the rent at time of the new legislation coming in? It seems mad that you can just tell the RTB you've increased the rent over the cap and they don't do anything about it.

Eric Cartman · 12-11-2018 11:19pm

jd wrote: »

Just back from SF, and the following was in the news

https://www.sfchronicle.com/business/article/SF-fines-Airbnb-landlords-2-25-million-for-13364513.php

if they own even half of those 17 buildings then thats pocket change, one building in downtown SF with multiple units would be worth north of 7.5 million easy.

davindub · 12-11-2018 11:22pm

runawaybishop wrote: »

This is wrong, any property on Airbnb before Dec 2016 is exempt from the 4% per year rise as that is when the caps were introduced. Once they let it out they will be subject to the restrictions but can set what they want initially.

Its actually 2 years before the RPZ came in rather than off the market for 2 years.

"where a dwelling has not at any time been the subject of a tenancy during the period of 2 years prior to the date the area is prescribed under section 24A as a rent pressure zone or deemed to be so prescribed"

the_syco · 12-11-2018 11:45pm

jd wrote: »

Just back from SF, and the following was in the news

https://www.sfchronicle.com/business/article/SF-fines-Airbnb-landlords-2-25-million-for-13364513.php

Ah... San Fran, where you could be classed as being low income if you're earning under the 100k mark in the Bay Area.

jd · 13-11-2018 12:41am

the_syco wrote: »

Ah... San Fran, where you could be classed as being low income if you're earning under the 100k mark in the Bay Area.

Well yeah, there is not the same reason to go there as there was before (IMHO). I lived there for while in the early 90s, as did some other people I know. We arrived there on spec. You can't go there without a plan now! A friend of my brother touched on it in the IT.

That said there are still people I know living there who have managed to stay because of rent controls. I'm not sure what they'll do if their tenancy ends. People have moved to Oakland and latterly, LA.

Fian · 13-11-2018 11:24am

runawaybishop wrote: »

This is wrong, any property on Airbnb before Dec 2016 is exempt from the 4% per year rise as that is when the caps were introduced. Once they let it out they will be subject to the restrictions but can set what they want initially.

I'm pasting the below from somehting i just posted in another thread. If a property was not subject to a tenancy during the two years ebfore the RPZ was established it is not captured by teh rent caps. Not even after it is let out.

No, not if it was not the subject of a tenance rented in the two years prior to the establishment of the RPZ.

It is not subject to a 4% increase cap, but it remains subject to a cap based on market rent of similar properties. So rent can be increased every 12 months to market rent, with 90 days notice.

See section 19(5) inserted by the 2016 amendments:

http://www.irishstatutebook.ie/eli/2016/act/17/section/34/enacted/en/html#sec34

(5) Subsection (4) does not apply—

(a) where a dwelling has not at any time been the subject of a tenancy during the period of 2 years prior to the date the area is prescribed under section 24A as a rent pressure zone or deemed to be so prescribed;

(b) if, in the period since the rent was last set under a tenancy for the dwelling—

(i) a substantial change in the nature of the accommodation provided under the tenancy occurs, and

(ii) the rent under the tenancy, were it to be set immediately after that change, would, by virtue of that change, be different to what was the market rent for the tenancy at the time the rent was last set under a tenancy for the dwelling.

some landlords have been voluntarily abiding by teh 4% increase cap though they are not legally obliged to.

13-11-2018 11:38am

Claw Hammer wrote: »

A 2 year break doesn't break the rent cap. A property that was being let within 2 years prior to the rent cap coming into force is always caught by it, no matter how long an interval there is between lettings. Once you let a rent cap in, it is impossible to get rid of it.

It’s a ridiculous rule and not only is it close to impossible to enforce its even difficult to abide by.

I could buy a property with vacant possession that was rented, live in it for a year sell it and the next person buys it and rents it and they have no idea whatsoever what the rent was nor can they be accused of breaking a rule they have no idea they are breaking it.

robp · 13-11-2018 6:22pm

Carlos Slow Traitor wrote: »

It’s a ridiculous rule and not only is it close to impossible to enforce its even difficult to abide by.

I could buy a property with vacant possession that was rented, live in it for a year sell it and the next person buys it and rents it and they have no idea whatsoever what the rent was nor can they be accused of breaking a rule they have no idea they are breaking it.

You are completely right. This scenario probably occurs too, because if a property has been rented out below market rent than a home owner will not want to disclose this information which devalues the property. Nor will they want to be honest when submitting the price to a price register. Rent controls like all price controls distort supply by creating perverse incentives. If you want to help people you need more market.

4ensic15 · 14-11-2018 9:18am

robp wrote: »

You are completely right. This scenario probably occurs too, because if a property has been rented out below market rent than a home owner will not want to disclose this information which devalues the property. Nor will they want to be honest when submitting the price to a price register. Rent controls like all price controls distort supply by creating perverse incentives. If you want to help people you need more market.

An intending investor will make enquiries about the ownership of the property. The rent cap was only supposed to last 3 years. Some chance of that now. More trouble for intending investors.

TSQ · 18-11-2018 1:41am

Carlos Slow Traitor wrote: »

It’s a ridiculous rule and not only is it close to impossible to enforce its even difficult to abide by.

I could buy a property with vacant possession that was rented, live in it for a year sell it and the next person buys it and rents it and they have no idea whatsoever what the rent was nor can they be accused of breaking a rule they have no idea they are breaking it.

For how long is a property listed on the RTB database after it has ceased being a rental property? Are properties delisted automatically if not renewed on the anniversary of last notification, or on request (of the owner)? I know of a couple

LotharIngum · 18-11-2018 11:35am

TSQ wrote: »

For how long is a property listed on the RTB database after it has ceased being a rental property? Are properties delisted automatically if not renewed on the anniversary of last notification, or on request (of the owner)? I know of a couple

I have always registered all of my tenants for about 10 years and the property still is not on the RTB database.

I know people who have stopped renting years ago and their properties are still on it, even though they replied to letters from the RTB.

4ensic15 · 18-11-2018 8:49pm

TSQ wrote: »

For how long is a property listed on the RTB database after it has ceased being a rental property? Are properties delisted automatically if not renewed on the anniversary of last notification, or on request (of the owner)? I know of a couple

When a property is no longer rented, the RTB is supposed to be notified.

Kidkinobe · 04-01-2019 9:15am

Reading the threads in here, there seems to be a lot of people saying 'Landlords are giving up on land lording because its just got too difficult and not worth the grief'
If there are any Airbnb hosts in here, do you intend to continue airbnb'ing under the new rules and regs or just giving up on it?
Govt are saying rental prices are high because of landlords preferring the Airbnb system and the financial return but in the same breath, making it very difficult for private landlords to break even.
Seems like a catch 22 system where no one will actually benefit from anything.
Worth a discussion I thought...

Fol20 · 04-01-2019 9:54am

I dont ll for airbnb and personally believe most wont get planning permission to keep it as airbnb. I think we will see that some properties will come back into the market but no where near what the government are "expecting".

Air BnB [and other platforms] to be effectively outlawed in high demand areas

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