You want to create a new civil service quango?
No. LA's already exist. They can be funded as appropriate to build housing. There are basically four types of housing in my view
1) LA housing for people and families who have no reasonable means to source accommodation for themselves
2) Social and Affordable housing for people and families who do have incomes but whose incomes are deemed insufficient to ever afford a home in private market.
3) Private rental market. For people and families who earn incomes over and above thresholds for social supports and/or who cannot afford to buy a house or who choose not to own a house.
4) Private home ownership. For people and families whose incomes qualify for mortgages to buy homes.
Its
3) Im focused on.
How would the rental agency make money if they charge the tenant LA rents and pass on this rent to the LA?
Ok I have explained all of this before, so I will try keep it simple.
- LA (say Dublin City Council) assesses housing needs for the population in its area. It deems there is a severe shortage manifesting itself in increasing numbers of homelessness, waiting lists
and notably that private rental rates are at record highs.
- It builds 2/3 bed townhouses and apartments as required.
- It begins to allocate these houses on basis of need.
- It recognises that alot of working people who by virtue of their incomes are disqualified from social supports but are also paying chronically high proportions of their incomes on rents. It recognises that these people are also in need.
Proposal
The LA designates a portion of the new housing it builds to be occupied by income earning tenants who by virtue of their incomes are disqualified, until now, from any social supports with regard housing.
The scheme will operate in designated RPZ's initially.
The LA will request letting agents or any other property management agents/companies to take charge of properties in the day to day management, furnishing, letting of properties to tenants and any other conditions it deems reasonable and appropriate.
The LA will award the letting of the property to the letting agent/property manager that, amongst other things, guarantees the
lowest rent to the tenants.
The letting agent will pay the LA a sum equivalent to the average LA authority rent (around €400pm).
The letting agent will also pay for furnishings, fixtures and fittings, management fees (if applicable) etc.
For sake of argument, lets say the cost of managing the property for the letting agent is circa €700 a month including LA fee. No mortgage, or interest payments.
Currently a two-bed townhouse or apt in Dublin city centre can fetch €2,500-€3,000 a month.
Thats a minimum of €1,800 a month clear profit.
However, the LA being in the business of serving the public will only award the management of the property to the letting agent/property manager who guarantees the
lowest rent to the tenant. Therein lies a competitive tendering process where letting agents and landlords are competing against each other to avail of the profits to be made from providing the exact same service that they would otherwise provide for their clients or in their capacity as private landlords.
The question emerges, how low would the rent go before a letting agent/property manager deems it not worthwhile to provide the service of managing a property for profit.
I hope that explains the concept?
If so, I will try to answer other questions you may have.
if not, then no need to continue any further.