RPZ - Barrier to entry for Landlords looking to buy.

K

Knuttell

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Perhaps this has been mentioned before, the RPZ means landlords selling up with low rents rely heavily on owner occupier to purchase as the low rent is very unattractive to potential investor who would inherits whatever rent was previously set.

There is another side to the coin. I as an investor have been looking for a property to buy but time and time again I'm coming up against ex rental stock with pitifully low previous rents. Been looking at Mullingar and Balbriggan and must have had to rule out 20 something properties at this stage where the monthly rent was massively below actual achievable rents.

Quite frustrating actually. The RPZ system is making it quite difficult for me to buy a renal property which i would then place back on the rental market.
 
Apartment so significant renovation not really possible nor is it viable to leave empty for 2 years, needs to be making money from day one.

If I went down the Ukranian route, where would that leave me in terms of rent I could charge post Ukrainian tenants....are the Govt still looking for properties for Ukranian tenants and could they unilaterally decide to put in some other class of tenant that I wouldn't likely rent to ever.
 
Ukrainian accomodation is outside the RTB registration process. All the info is on the official Govt. website.
 
RPZ is a most imperfect instrument, forcing landlords to sell up as rent is so low and keeping new landlords out as they inherit the low rent.

It reminds of the Reagan joke

"the nine most terrifying words in the English language are ‘I’m from the government and I’m here to help.’”
 
Knuttell said:
Apartment so significant renovation not really possible nor is it viable to leave empty for 2 years, needs to be making money from day one.
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If the rent is sufficiently below market levels it could make sense to leave it empty as you could break even in under four years.

I am curious what you are looking at. Could you give us an example here with:
-RPZ rent
-likely market rent
-asking price
 
NoRegretsCoyote said:
If the rent is sufficiently below market levels it could make sense to leave it empty as you could break even in under four years.

I am curious what you are looking at. Could you give us an example here with:
-RPZ rent
-likely market rent
-asking price
Click to expand...
RPZ rent 720pm
Likely rent 1350
Asking price 150k
 
Knuttell said:
RPZ rent 720pm
Likely rent 1350
Click to expand...
If you leave it empty your breakeven point is a little over 4 years - possibly sooner if market rents rise.

I am sure you can find a "caretaker" in the interim who would live there rent-free and pay all bills and management charges.

I've no expertise on the Ukrainian scheme but this might work in the same way.
 
Looked into Ukraine scenario, I'd have to cover gas/ electricity/broadband etc so stopped being attractive then. My experience with things that are provided free is no value is placed on them and I'd likely get stung with big bills.
 
Could you buy outside an RPZ? A TD recently highlighted an anomaly for Clogherhead, Co Louth - due to a change in local electoral area boundaries, and the timing of the RPZ rollout in Co Louth, Clogherhead is not in an RPZ. It can't be the only area affected?

Drogheda Life | Rent Pressure Zone anomaly leaves Clogherhead tenants facing big rent hikes

A bizarre anomaly in the local designation of Rent Pressure Zones has resulted in tenants in Clogherhead facing some of the biggest rent hikes in the country, according to Louth Labour TD, Ged Nash.
droghedalife.com droghedalife.com
 
Good point, had looked at New Ross, but apartment blocks looked very ropey and the older houses were complete gut jobs despite looking alright on photos...part of my problem is budget circa 160k.
 
Knuttell said:
Good point, had looked at New Ross, but apartment blocks looked very ropey and the older houses were complete gut jobs despite looking alright on photos...part of my problem is budget circa 160k.
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New Ross, in my opinion, is a good spot to get properties that are out of the RPZ but still demanding high rents, on par with Waterford City. I know of several nice 2 bed 2 bath apartments coming to the market at around which are well below your budget of and will offer a good return of 10 or 11% per annum. I bought two places there myself recently and I'm very happy with them. There are also decent town houses there under your budget that don't require any (or very little) work. I'll send you a link as an example. I should note, I have no vested interest in recommending anything.

I wouldn't rule out the Ukranian route either, I've got them in an investment property of mine. 800 tax free each month, additionally, although there can be no rent agreement in place, they can pay you maintenance for the property themselves on top of the 800 you get from the government. The family I have in my property are working here, so the additional maintenance payment covers any additional costs.

I have a fair bit of knowledge on investment property in the area, feel free to message me if you have any questions.

EDITED TO SAY:
I don't seem to be able to send you a direct message? Maybe you have them turned off or something.
 
Thanks a lot, not sure what issue is with PMs but feel free to post link on this thread
 
Knuttell said:
Thanks a lot, not sure what issue is with PMs but feel free to post link on this thread
Click to expand...

I linked one below. 150K. Place is newly refurbished, just needs to be furnished and it's ready to let. You will furnish it for 2 - 2.5K for beds, couch etc. from the likes of Jysk or even cheaper if you want to go to the trouble of searching Done Deal. I often get great deals on there. I have property in the area that I'm letting out. You will get €1,300 per month for this place, no problem. Depending on what you spend to furnish it that will leave you with a gross return of 10% or more.

Potential Investment Property

Here's another option , i actually viewed this, I was going to buy it myself, the plan changed but I still consider it a good investment.

Apartment, New Ross

120K + legal fees is 125K. You will rent it for €1,200, you could get higher but I think 1,200 is fair and still gives the return you're after. Service charges for the block are about 1,200 - 1,300. After purchase price, legal fees and service charges are all accounted for it leaves you with over 10.5% return per annum. This apartment complex is well looked after and well run. You may have been looking at the ones in Waterside across the road, the management company has not been very active there and the place has become run down but that's not the case in The Moorings.

Both good options in my book. I live close to the area, if you need any help I'm happy to answer questions or even lend a hand.
 
Ruben86 said:
EDITED TO SAY:
I don't seem to be able to send you a direct message? Maybe you have them turned off or something.
Click to expand...
Disabled for new posters to put off spammers.

One of the goals of AAM is to provide a resource people can refer to for answers or guidance on common issues. People taking conversations offline goes against this goal and so is discouraged.

Note also that if you are professionally involved in a related sector we ask that you declare any interests and note that any advertising or soliciting for business is banned.
 
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