# "Rents are at a record high – so why are private landlords selling up?"



## Brendan Burgess

Rents are at a record high – so why are private landlords selling up?
					

Smart Money: For every two landlords selling, only one is buying




					www.irishtimes.com
				




Good article by Cliff Taylor quoting research by Amárach

A recent survey from the RTB, completed by Amárach, shows that while there is not a flood of landlords planning to leave, there is a steady stream. Among smaller landlords with one to two properties, just over one quarter plan to sell a property within the next five years, and around 10 per cent within one year. Very few – just 6 per cent – intend to reinvest in buying more property. Rural landlords were more likely to sell than those in Dublin.

Among the reasons given were the difficulty some found in making a profit, with one in four saying their income was less than their cost. The factors quoted as negatives includded taxes, with landlords complaining that deductions for expenditure which they could make against their tax bill had tightened in recent years. Meanwhile rental income for most is exposed to tax at a marginal rate of 50 per cent plus, as the vast bulk are part-time landlords with other earnings.

More onerous regulations were also blamed by some – seen as tilting the balance too far towards tenants and restricting annual rent increases inside rental pressure zones in the cities. Meanwhile given the generally older age of landlords, some were planning to sell to fund their retirement.


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## horusd

I confess I know little about the rental market per se, but I did read the article yesterday and wondered whether or not we needed to attract  larger private landlords - as are common in most developed rental markets like Germany and Austria - to become the norm here? I understand that many properties in places like Vienna (where I lived) were owned by pension funds and the like. This seems a more stable prospect, but probably needs to be considered in the round as part of a long-term housing strategy.


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## ClubMan

You mean evil, predatory, absentee landlords?


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## horusd

@ClubMan lol.  I know, and given our history, "forrin" absentee landlords might be anathema, but I suspect there are economies of scale in larger owners  such as pension funds having an  input. I imagine we could, to some extent, copy and paste legal and tax legislation (at least somewhat)   from  our European friends to make it a runner.  This would necessarily form part of a comprehensive response to problems in the housing market.


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## NoRegretsCoyote

horusd said:


> I understand that many properties in places like Vienna (where I lived) were owned by pension funds and the like. This seems a more stable prospect, but probably needs to be considered in the round as part of a long-term housing strategy.


Funds are certainly going to be a big part of funding of new development (in particular apartments). The days of new multi-unit developments having multiple owners are largely gone. A friend of mine knows this space and he pointed out the bleeding obvious recently to me. These developments are FAR more valuable (in the region of 20%) when owned as a whole than when owned separately. There are obvious economies of scale from managing an entire development, but the big plus is that you can sell up or re-develop the site in 20 or 25 years. This is impossible with developments in multiple ownership. Multiple ownershp will still exist at the very high end, but the vast majority of new build apartments will have a single owner.

The best landlord I ever had was a fund. They threatened the noisy neighbours upstairs with eviction and it worked. No issues or quibbles with notice or deposit. One neighbour said he'd lived in three or four units in the same development over the years. They rewarded loyal tenants with apartments with a better aspect. Sometimes people even moved within the development as their needs changed. None of this possible when developments are in multiple ownership.


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## Allpartied

They are selling because the market is topping.  Another property crash is inevitable, as property is totally unaffordable for average earners. 
If a three bedroom house/apartment in a modest area of Dublin costs 3/4k a month to rent, then it is beyond a family earning less than 70k.  Most people don't earn 70k. 
While the supply side is a massive problem, there remains a limit on what renters can pay and what buyers can borrow. 
The solution would be to build 200k council houses and rent them to people, like we used to.


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## kinnjohn

horusd said:


> @ClubMan lol.  I know, and given our history, "forrin" absentee landlords might be anathema, but I suspect there are economies of scale in larger owners  such as pension funds having an  input. I imagine we could, to some extent, copy and paste legal and tax legislation (at least somewhat)   from  our European friends to make it a runner.  This would necessarily form part of a comprehensive response to problems in the housing market.


horusd if any of the information I have posted below is incorrect please post and correct it,

You say you live in Austria so let's look at Austria
If you lived in Austria and you had been working for a number of years and you lost your job you would get paid enough to pay the rent and live from your social security payments,

from 1990 to 2021 I think the average social security payroll take is around 39% in Austria,
The employer pays around 21%
Employees pay around 18%
I go walking hiking in the Alps in Austria  almost every year
I was talking to an Austrian woman out walking  the last time I was there she had just turned 65 and retired from Childminding  in her home for over 30 years if I understood her correctly the home she was living in was rented while she was childminding,
she was now going to rent a new home the social security she paid while minding the children gave her enough of a pension to retire comfortably and rent a new home for the rest of her life,

looking at my own payslips From 1990 to 2016  when I retired payroll social security averaged around 19.%
employer around 10.5%
Employee around  9%
If I was out of work I would get the same as if I never worked a day in my life if you earn 300 euro per week you get 203euro
if you earn 1000 a week or 10000 a week you still get 203 euro social security
For rental to become the norm like in Austria and Germany Irish social security rates and payments would have to follow Germany and Austria first,
self-employed pay 4% social security in Ireland from 1990 to 2021,
self-employed pay 27% social security in Austria,


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## odyssey06

NoRegretsCoyote said:


> Funds are certainly going to be a big part of funding of new development (in particular apartments). The days of new multi-unit developments having multiple owners are largely gone. A friend of mine knows this space and he pointed out the bleeding obvious recently to me. These developments are FAR more valuable (in the region of 20%) when owned as a whole than when owned separately. There are obvious economies of scale from managing an entire development, but the big plus is that you can sell up or re-develop the site in 20 or 25 years. This is impossible with developments in multiple ownership. Multiple ownershp will still exist at the very high end, but the vast majority of new build apartments will have a single owner.
> 
> The best landlord I ever had was a fund. They threatened the noisy neighbours upstairs with eviction and it worked. No issues or quibbles with notice or deposit. One neighbour said he'd lived in three or four units in the same development over the years. They rewarded loyal tenants with apartments with a better aspect. Sometimes people even moved within the development as their needs changed. None of this possible when developments are in multiple ownership.


Not disagreeing with your main point but just noting there can be a flip side to that story down the line though which is if a single owner wants to redevelop in 20 years they have an incentive to let things run down at that point.
And perhaps what we are lacking is the possibility of a condo (?) setup of owner occupier only apartment complexes.


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## Purple

Allpartied said:


> The solution would be to build 200k council houses and rent them to people, like we used to


When we did that, between the 30’s and 50’s, we spent very little on welfare, health and education. We were poor and, for the first 40 years after independence, got poorer. It was only when we shifted our state spending to human capital that we got richer. Going back to that model would be madness. We do need to build more public housing but we should be careful what we wish for.


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## AlbacoreA

People wanted Larger institutional landlords, well they got them. Their numbers are increasing
People wanted small landlords out of the market. Well they've got that as well as their numbers are decreasing.

Supply is still falling and rents still increasing.


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## PGF2016

Allpartied said:


> They are selling because the market is topping.  Another property crash is inevitable, as property is totally unaffordable for average earners.
> If a three bedroom house/apartment in a modest area of Dublin costs 3/4k a month to rent, then it is beyond a family earning less than 70k.  Most people don't earn 70k.
> While the supply side is a massive problem, there remains a limit on what renters can pay and what buyers can borrow.
> The solution would be to build 200k council houses and rent them to people, like we used to.


Why if there is a lack of supply will there be a crash? Genuine question.


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## Gordon Gekko

Data is not the plural of anecdote, but almost every landlord I know who has sold up was “accidental”.

i.e. it was their starter or interim home but the financial crisis left them with negative or negligible equity.


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## kinnjohn

PGF2016 said:


> Why if there is a lack of supply will there be a crash? Genuine question.


Irish people always voted with their feet,
Another good example is lots of eastern European construction workers left Ireland after losing their jobs after the last crash and went to work in the likes of Germany, there are two reasons why they will never work in Ireland again the social security they got was enough to feed themselves but nothing left over to pay rent or mortgage,
there will be lots of houses and no money to pay rent or mortgage like in 2008/2009 if the job market tanks,


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## AlbacoreA

I thought there would be economic crash post  the lockdown. But for every business that did badly. There has been another than has done well. Some people have never been busier. Maybe it's not 50:50 but one is offsetting the worst of the other. 

If people were to emigrate there is no where to go to that hasn't got the same problems. 

In 2020 and 2021 we still have the population increasing. So more are coming here than leaving. Which means more demand for housing. 

Add to that we have a backlog demand for housing created over the last decade.


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## The Horseman

Landlords are selling because the rental market is so toxic for small landlords. 

The title of the post speaks volumes. If rents were covering mortgages after tax then logic would say keep the property as its paying for itself.

Both Threshold and the RTB and now even the Govt have acknowledged the fact. Unless the Govt rebalance the situation then expect the situation to continue.


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## kinnjohn

look how much the state was allowed to borrow because of the lockdown, do you really think we would be allowed to borrow at close to zero in a crash,
if there is another crash it will be like 2008/9 again, possibly a lot worse if self-inflected again,
Back to this thread 
In a downturn, new/old landlords with mortgages are exposed to falling asset prices mortgage repayments, and possibly tenants who need to feed themselves first before thinking about paying rent if affected by a downturn,

most private landlords  selling up at present were never in it to make a profit from rent returns, Most were expecting the property to increase in value and are getting out now while they are ahead,


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## cremeegg

Purple said:


> When we did that, between the 30’s and 50’s, we spent very little on welfare, health and education. We were poor and, for the first 40 years after independence, got poorer. It was only when we shifted our state spending to human capital that we got richer. Going back to that model would be madness. We do need to build more public housing but we should be careful what we wish for.


As usual Purple has an interesting and original (afaik at least) point to contribute.


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## cremeegg

kinnjohn said:


> Irish people always voted with their feet,


In the past the UK, US and other countries were much richer than Ireland, so even low status jobs there could be attractive to Irish emigrants, today Ireland is wealthier than most other countries the emigration outlet is no longer very attractive.


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## cremeegg

Allpartied said:


> They are selling because the market is topping.  Another property crash is inevitable, as property is totally unaffordable for average earners.
> If a three bedroom house/apartment in a modest area of Dublin costs 3/4k a month to rent, then it is beyond a family earning less than 70k.  Most people don't earn 70k.
> While the supply side is a massive problem, there remains a limit on what renters can pay and what buyers can borrow.
> The solution would be to build 200k council houses and rent them to people, like we used to.



Property in Ireland is cheap to buy, by comparison with building costs and by comparison with international price/income ratios.

Most couples working full time earn well over €70k per annum.


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## kinnjohn

cremeegg said:


> In the past the UK, US and other countries were much richer than Ireland, so even low status jobs there could be attractive to Irish emigrants, today Ireland is wealthier than most other countries the emigration outlet is no longer very attractive.


Ireland is full of high paid jobs at present, take away the high paid job for a year lots have no wealth worth talking about,
lots could emigrate and get a good job outside of Ireland if we mess up again,

I bought a few houses in the downturn and have them rented out, I would not buy at present going off  present rent and house prices,


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## AlbacoreA

I think a lot of people have cash built up in the lockdown. 

I think i even a crash would be a lot softer than the last time.


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## kinnjohn

cremeegg said:


> Property in Ireland is cheap to buy, by comparison with building costs and by comparison with international price/income ratios.
> 
> Most couples working full time earn well over €70k per annum.


I agree 
but in the back of my mind, I feel there will be upheaval in relation to taxation to many pressure and lobby groups are controlling the Government  no matter who gets elected,
Couples on 70K per annum are going to see a big increase in taxation,


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## PGF2016

kinnjohn said:


> Irish people always voted with their feet,
> Another good example is lots of eastern European construction workers left Ireland after losing their jobs after the last crash and went to work in the likes of Germany, there are two reasons why they will never work in Ireland again the social security they got was enough to feed themselves but nothing left over to pay rent or mortgage,
> there will be lots of houses and no money to pay rent or mortgage like in 2008/2009 if the job market tanks,


That doesn't answer the question. Demand is outstripping supply. What will cause the next crash?


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## joe sod

kinnjohn said:


> look how much the state was allowed to borrow because of the lockdown, do you really think we would be allowed to borrow at close to zero in a crash


That's the key point , the state will have borrowed 50billion to pay for the pandemic, the pup and all the other stuff, that's why demand for housing did not fall.
For some reason though inflation is still relatively low through out the eurozone in comparison to UK and US even though sterling has risen in value in comparison to the euro over the last year. Surely high inflation in the UK should be reflective in the currency falling in comparison to the euro? 
I think interest rates are more negative in the eurozone than in UK or US yet still very low inflation rates. Something not really right about the whole thing, if the eurozone has to raise interest rates its game over for the borrowing binge that the government has been enthusiastically engaged in


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## kinnjohn

PGF2016 said:


> That doesn't answer the question. Demand is outstripping supply. What will cause the next crash?


slowing down of the job market, loss of corporation tax, and the need for tax increases along with job losses,

 a Citizens assembly proposing to bringing in a hefty wealth tax on property to make for tax shortfalls,, and the main political parties going along with it because they have no other choice,

one thing I notice I bought a few properties after the crash and have them let out  I looked at other properties before and after I bought mine, I have a good idea who bought a good few of them most were bought and left vacant if bought by Irish people
the new Irish bought and moved in straight away

Irish first-time buyers who could get a mortgage were not buying for some reason,
now all of a sudden they all want to buy today if possible just like before the last crash,
there are a large number of homes with one or two old people living in them which will be coming on to the market
in the coming years,


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## DazedInPontoon

kinnjohn said:


> now all of a sudden they all want to buy today if possible just like before the last crash,


I would say the last crash was *after* everyone bought


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## kinnjohn

DazedInPontoon said:


> I would say the last crash was *after* everyone bought


if everyone had bought why was there so many half-finished ghost estates all over Ireland after the crash,
don't forget demand was outstripping supply the day before the crash, demand disappeared overnight,
strange,
as I said after the crash people who could get mortgages and afford to buy  are now in the market  buying at the same time,


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## DazedInPontoon

Because the number of houses an Irish person in boom times must own is 'n +1' when 'n' is the number of houses they currently own.

Seriously though, anecdotally there didn't seem to be much of a shortage, neither in terms of property nor credit, everyone I know who wanted to buy did, which is not what I'm seeing today.


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## Protocol

cremeegg said:


> Property in Ireland is cheap to buy, by comparison with building costs and by comparison with international price/income ratios.
> 
> Most couples working full time earn well over €70k per annum.




Outside of the cities, I accept that modest houses are affordable to couples.

A relation recently paid 210-215k for a 4-bedroom detached 125sqm house in an okay estate (not great) in a provincial town.

An okay detached house in an okay estate, but nothing you'd aspire to, for 215k, so not too bad. 

Is this affordable for a couple on 80k? Yes.

Is the price reasonable compared to build costs? Yes.



*However*, move to a city suburb, and a new 125 sqm semi-detached house can be 375k-415k.

That price is out of reach for a couple on 80k or 90k.


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## kinnjohn

DazedInPontoon said:


> Because the number of houses an Irish person in boom times must own is 'n +1' when 'n' is the number of houses they currently own.
> 
> Seriously though, anecdotally there didn't seem to be much of a shortage, neither in terms of property nor credit, everyone I know who wanted to buy did, which is not what I'm seeing today.


I bought a house I am afraid to tell you how little I gave for it, I believe the people who bought it off plans slept in their car overnight in case they missed out, credit was no problem back then,

most of the labor was East European I know a few Irish who worked on the site most are past retirement age,
they tell me the problem with the building industry now is most of the eastern European around here moved to Germany
there is  ongoing small scale building going on  a few large sites around where I live the labour is not there to scale up anymore,


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## joe sod

There seems to have been a big change in aspirations over the last 2 decades, it is now very difficult to attract labour into the construction industry no matter how good the wages are, nobody wants to do it anymore. The immigration that is coming in now also does not want to work in construction, the welfare rates are simply too good in Ireland and now the pup is acting like a magnet to keep a lot of potential labour away from construction. The government is the problem along with left wing populism


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## AlbacoreA

I can't see welfare rates competing with what you'd earn in construction.


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## AlbacoreA

...


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## AlbacoreA

kinnjohn said:


> slowing down of the job market, loss of corporation tax, and the need for tax increases along with job losses,
> 
> a Citizens assembly proposing to bringing in a hefty wealth tax on property to make for tax shortfalls,, and the main political parties going along with it because they have no other choice,
> 
> one thing I notice I bought a few properties after the crash and have them let out  I looked at other properties before and after I bought mine, I have a good idea who bought a good few of them most were bought and left vacant if bought by Irish people
> the new Irish bought and moved in straight away
> 
> Irish first-time buyers who could get a mortgage were not buying for some reason,
> now all of a sudden they all want to buy today if possible just like before the last crash,
> there are a large number of homes with one or two old people living in them which will be coming on to the market
> in the coming years,



You keep talking this up like its the same as the crash after the Celtic tiger. Its not.


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## Gordon Gekko

AlbacoreA said:


> You keep talking this up like its the same as the crash after the Celtic tiger. Its not.


It’s a mistake that lots of people make.

They compare what we’ve been through to a recession or a crash.

It’s neither; we consciously and deliberately switched off elements of the economy in order to save lives. And now we’re rebooting it.

If you look at what’s happening in the US, and indeed globally, I’d argue that it’s more likely we’re entering a golden era rather than a period of woe. Look at what happened post Spanish Flu and World War I; the Roaring Twenties.


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## Itchy

AlbacoreA said:


> I can't see welfare rates competing with what you'd earn in construction.



Then explain why the gubberment cant get "the immigration" to work then???


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## AlbacoreA

I've no idea what you're trying to say.


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## cremeegg

Protocol said:


> Outside of the cities, I accept that modest houses are affordable to couples.
> 
> A relation recently paid 210-215k for a 4-bedroom detached 125sqm house in an okay estate (not great) in a provincial town.
> 
> An okay detached house in an okay estate, but nothing you'd aspire to, for 215k,


If a 4 bed detached house is “nothing you’d aspire to”. For a couple on €80k. I think we have allowed our aspirations to get ahead of our reality.


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## Gordon Gekko

cremeegg said:


> If a 4 bed detached house is “nothing you’d aspire to”. For a couple on €80k. I think we have allowed our aspirations to get ahead of our reality.


It’s in an “okay estate” in a provincial town…


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## Pmc365

Everywhere outside Dublin is not classed as rural.


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## Purple

Gordon Gekko said:


> It’s a mistake that lots of people make.
> 
> They compare what we’ve been through to a recession or a crash.
> 
> It’s neither; we consciously and deliberately switched off elements of the economy in order to save lives. And now we’re rebooting it.
> 
> If you look at what’s happening in the US, and indeed globally, I’d argue that it’s more likely we’re entering a golden era rather than a period of woe. Look at what happened post Spanish Flu and World War I; the Roaring Twenties.


I've no idea what will happen but governments were much smaller as a proportion of national income back then and State debt levels were also much lower. 
In the 1920's government spending in developed countries was 10-25% of GDP. Now it's 40-50% of GDP. In Ireland it's doubled since the 1920's That's not a bad thing but it does mean that recessions require far greater levels of borrowing to  make up the shortfall.


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## Ravima

Getting back on topic, many landlords in Ireland are owners of one perhaps two other properties, that they may have bought in the past 20 years as investments. Now they are approaching retirement and the hassle of being a landlord is just too much. The mortgage is probably paid off and there is a lump sum on sale of the property that can be invested elsewhere or spent on the holiday of a lifetime.

Its not that the high rents are taxed as tax is the price we pay for all the services, but the other costs all add up. There is maintenance; management charges; prtb; insurance; property tax etc. Some will say that there are tax deductible and so they are, but they must still be paid. Add in the hassle of the 2am call to say the toilet is blocked; the washing machine is broken; the neighbours complaining either justifiably or unjustifiably and the nightmare tenant.

If there was money to be made in it, people would become landlords and not the reverse.


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## AlbacoreA

Something like 70% of LLs have one rental up to 85% have one or two. 

I don't buy into the idea of the great sell off. Landlords often buy them to provide income as a form of pension (passive income) when they retire. There is no need to sell them off, once they are paid for. I think people are a little obsessed with the capital appreciation of  rentals as if thats only objective of property.


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## odyssey06

AlbacoreA said:


> Something like 70% of LLs have one rental up to 85% have one or two.
> 
> I don't buy into the idea of the great sell off. Landlords often buy them to provide income as a form of pension (passive income) when they retire. There is no need to sell them off, once they are paid for. I think people are a little obsessed with the capital appreciation of  rentals as if thats only objective of property.


The article mentions that as one of the reasons why landlords sell up, but it seems to suggest there isn't a next generation of small scale landords replacing them adopting the same strategy.


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## The Horseman

AlbacoreA said:


> Something like 70% of LLs have one rental up to 85% have one or two.
> 
> I don't buy into the idea of the great sell off. Landlords often buy them to provide income as a form of pension (passive income) when they retire. There is no need to sell them off, once they are paid for. I think people are a little obsessed with the capital appreciation of  rentals as if thats only objective of property.


The rtb, threshold and even the govt have acknowledged landlords are selling. If they are paid off logic would suggest continue renting them out.

Whether you accept it or not these are the facts borne out by those who want rental stock to increase rather than decrease.


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## AlbacoreA

Just in case people pick me up wrong I'm NOT saying they aren't leaving.
I'm saying people shouldn't assume they usually sell up once the mortgage is gone.

IMO.
They are selling up because the risk vs return, and return vs hassle is no longer worth it.
New landlords are not entering in the same numbers because the cost to entry vs return is too high.

Large landlords stick to high end, where the number of units, means the profitability is still viable.
Also the risk is spread over many units. Not just one.

Also RPZ and the new rules mean buying a new rental gives you higher rent than buying a property stuck on  a low rent. Which encourage people to sell off older and cheaper places and buy new places. Then you have the fair deal factor. Which both takes the rental property and the income from it (ok the rules have changes slightly).

Which (after supply and demand (population) which is the main issue) has the knock on effect of removing the cheaper property and moving the the price upwards.

So not just people selling up as they clear the mortgage, in my opinion. Though some do just do that.

There's a lot of nuance to it. In my opinion.


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## Allpartied

cremeegg said:


> Property in Ireland is cheap to buy, by comparison with building costs and by comparison with international price/income ratios.
> 
> Most couples working full time earn well over €70k per annum.


The percentage of rent, as a portion of earnings, is rapidly rising.   
This is punishing people, at the expense of small time rentiers and the overseas investors.  
Literally, sucking capital out of the economy. 

I don't think large rental companies is , necessarily , a bad thing.   For one, it is much easier to regulate them and they are much more likely to implement regulations.  It's easier to inspect them and easier to punish them.   They are more likely to have a comprehensive maintenance team , as well.  

When I rented off a private landlord, repairs, replacements, emergencies were a nightmare.   

" I'm in the Algarve, I'll give Seanie a ring, see if he can pop around  next week."


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## AlbacoreA

Allpartied said:


> The percentage of rent, as a portion of earnings, is rapidly rising.
> This is punishing people, at the expense of small time rentiers and the overseas investors.
> Literally, sucking capital out of the economy.
> 
> I don't think large rental companies is , necessarily , a bad thing.   For one, it is much easier to regulate them and they are much more likely to implement regulations.  It's easier to inspect them and easier to punish them.   They are more likely to have a comprehensive maintenance team , as well.
> 
> When I rented off a private landlord, repairs, replacements, emergencies were a nightmare.
> 
> " I'm in the Algarve, I'll give Seanie a ring, see if he can pop around  next week."



All these things, regulation, big companies, supply, small LLs leaving, are pushing the prices up. Supply is the main one. But the rest are all a factor. Not that small LLs keep the price low either.


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## Delboy

AlbacoreA said:


> All these things, regulation, big companies, supply, small LLs leaving, are pushing the prices up. Supply is the main one. But the rest are all a factor. Not that small LLs keep the price low either.


The population of the Republic has increased by 1.5m (43%) since 1995. Supply could never match that especially given that nobody ever planned for or envisaged a population growth rate at anything like that. And the Govt continues to encourage population growth at every turn. 

And the population continues to rise at a greater rate than houses/apts are coming on stream. The housing crisis will be with us for the next 50 years and more


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## NoRegretsCoyote

Delboy said:


> The population of the Republic has increased by 1.5m (43%) since 1995. Supply could never match that


Housing units in 1991 were 1 million.

Housing units in 2016 were 2 million.

Housing increased considerably more than population. Perfectly possible to do if the conditions are right.


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## AlbacoreA

I would say the devil is in the detail here. What's the breakdown of those housing units vs demand.


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## NoRegretsCoyote

AlbacoreA said:


> I would say the devil is in the detail here. What's the breakdown of those housing units vs demand.


Well population increased 50% and dwellings increased 100%.

Supply exceeding demand.


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## Purple

NoRegretsCoyote said:


> Well population increased 50% and dwellings increased 100%.
> 
> Supply exceeding demand.


Household unit size has to be factored in.
In the 1990's if you were an adult living at home with your parents because you couldn't afford a house. A person in the same scenario now is homeless. 
As long as the State gives away free houses there will be a housing list. 
As long as being homeless gets you further up that list there'll be a homelessness issue. 
As long as the State used your money to price you out of the housing market there'll be a housing affordability issue.

The main driver in house price inflation is the States social housing policy. The more it does, the more expensive housing becomes, the fewer people can afford to buy or rent, the more the State has to do. I'm not saying we shouldn't house people but we should acknowledge the unintended consequences of the policies we have.


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## joe sod

NoRegretsCoyote said:


> Well population increased 50% and dwellings increased 100%.
> 
> Supply exceeding demand.


Is the devil not in the detail though, in the 90s emmigration was still a big factor in Ireland mostly the young were emmigrating reducing the demand for houses so the same body of housing with small increases was more than sufficient.
This completely changed in the 2000s the young were staying and forming families here as well as that we were attracting new immigrants also forming families, so that 50% increase in population were virtually all looking for housing.
The 100% increase in housing is a bit illusionary because much of it was built in the wrong places in fields in longford and leitrim rather than in the cities, the infamous ghost estates, some of these were even demolished during the crash because there was absolutely no demand for them. A lot of that housing that was built like one off houses in the country does not satisfy housing demand.


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## Gervan

It is primarily the regulation that deters me from becoming a 'landlord'. 
I currently have a family living in my house under the rent a room relief scheme. It is not ideal; they would love to have a place to themselves, but there is nothing in their price range. Schools and jobs mean there is only a specific area suitable.
I have considered downsizing and letting them the whole house, but I couldn't face having to register with the RTB. The insulation is not up to their requirements, I don't have a cooker hob etc. 
If it is all right for me as an owner to live in a non-perfect house, why must tenants have a higher quality?

The second deterrent is that I am the one who deals with leaking fridges, cleans floors, opens windows and treats showers against mould, works out why the tumble dryer isn't working, all the little things that if left undone would lead to the property deteriorating. They are not deliberately careless, but don't seem to understand how things work. It must be rare tenants who take care of a property as well as the resident owner would.


----------



## Firefly

Gervan said:


> It is primarily the regulation that deters me from becoming a 'landlord'.


For me, a bad tenant not paying the rent and hiding behind the regulation / rtp would just mean too much downside risk. I am in favour of better standards of housing for tenants, but think it needs to be 50-50....the place should be nice but if the rent is not paid, then tenant should be made leave. I think this would lead to more landlords entering the market, which would lead to an increase in supply....


----------



## AlbacoreA

NoRegretsCoyote said:


> Well population increased 50% and dwellings increased 100%.
> 
> Supply exceeding demand.



I'm just not seeing that in the market. I see the opposite. 

I think some supply of new builds, and vacant properties are unsuitable for the demand. Or are deliberately kept vacant.


----------



## Purple

AlbacoreA said:


> I'm just not seeing that in the market. I see the opposite.
> 
> I think some supply of new builds, and vacant properties are unsuitable for the demand. Or are deliberately kept vacant.


Family units have got smaller.  30 years ago it was normal for siblings to share a bedroom. Now it's a breach of their human rights.


----------



## AlbacoreA

The rooms and houses are smaller too. Not just families. 

You go into show houses these days and you realize theres all sorts of trick's with fitted tables and beds to disguise the size of the rooms.


----------



## Purple

AlbacoreA said:


> The rooms and houses are smaller too. Not just families.
> 
> You go into show houses these days and you realize theres all sorts of trick's with fitted tables and beds to disguise the size of the rooms.


They did that 30 years ago too.


----------



## AlbacoreA

So, it seems like there is not shortage, and actually our properties are too big for us. 









						Seven in 10 Irish people live in homes too large for their needs
					

Average of 2.1 rooms per person in Irish dwellings compared with EU average of 1.6




					www.irishtimes.com


----------



## Purple

AlbacoreA said:


> So, it seems like there is not shortage, and actually our properties are too big for us.
> 
> 
> 
> 
> 
> 
> 
> 
> 
> Seven in 10 Irish people live in homes too large for their needs
> 
> 
> Average of 2.1 rooms per person in Irish dwellings compared with EU average of 1.6
> 
> 
> 
> 
> www.irishtimes.com


Everything points to  a proper residential property tax as a key part of the solution.


----------



## AlbacoreA

Purple said:


> Everything points to  a proper residential property tax as a key part of the solution.



That would have a further negative effect on supply especially rentals. 

But since the official stats don't reflect any supply problems guess we'll keep turning the heat up on the market.


----------



## Peanuts20

Lies, damn lies and statistics as the saying goes, If you drill down into the stats behind that report, you'll see that the average sqm per person in a household in Germany is 47m2, in Denmark it is 56 and in Ireland it is 36.5 whilst in Japan it is 22m2.

There is no doubt that in parts of Ireland that there are massive "macmansions" that really are not needed and I do wonder sometime what people do with them. The other side of the coin is I recall looking at so called 4 and 5 bedroom houses in the Celtic Tiger era where you might get a cot into the extra "bedroom" but you'd struggle to get a bed in. Also it's interesting how the size of gardens in new estates is far smaller then in older estates. That doesn't mean to say the older estates are a waste of land, to me it reflects a "race to the bottom" mentality when it comes to house building in Ireland and how do we cram the most "boxes" onto an area so the developers can maximise their profits with no thought to the social impact of what they are doing. 

What covid really brought home is the lack of joined up thinking in Ireland when it comes to house building. I recall being on holidays in Northern Spain a few years ago. We rented a City Centre Apartment. The Ground floor of every apartment block was given over to shops and businesses so that there were facilities for people living there. The apartments were well built, properly sound proofed and had large balcony's for people to use as well. There must have been a dozen playgrounds and play areas for kids and they seemed to be all properly maintained. 

Here we find a field in the rear end of nowhere and stick up 6 and 7 story blocks with no facilities worth talking about. I know Spain did the same in places but rather then focusing on the number of rooms, the size etc, should we not focus on the quality of what we are building and build communities and not rabbit hutches?


----------



## Purple

AlbacoreA said:


> That would have a further negative effect on supply especially rentals.


How so?
Triple the existing property taxes to stimulate more trading down, freeing up family homes where the infrastructure for children is already in place. If you are sitting on a house worth a million plus you are rich, even if you have a modest income. 


AlbacoreA said:


> But since the official stats don't reflect any supply problems guess we'll keep turning the heat up on the market.


We've been stimulating the demand side in the hope that supply would follow but it's not an open market so normal market forces don't apply.
There is a supply side constraint on land and labour and massive costs associated with State inefficiencies.


----------



## AlbacoreA

Landlords will pass on taxes to renters increasing tents, and people won't upsize  to avoid taxes. Putting even more pressure on smaller affordable housing. People won't downsize because of the supply issues you've just caused. 

There's no supply problems of expensive property.


----------



## joe sod

AlbacoreA said:


> The rooms and houses are smaller too. Not just families.


What about all the McMansions that have been and are still being built the length and breadth of the country, that only started in the 2000s , in the 70s and 80s it was just a bog standard 3 bedroom bungalow. These houses consume alot of materials and labour and result in less units being built, you don't see that anywhere else in Europe


----------



## AlbacoreA

That's true. When I visit outside the city I'm staggered by the size of properties that have been built all over the place.


----------



## Purple

AlbacoreA said:


> There's no supply problems of expensive property.


They are expensive because there’s a supply problem.


----------



## Purple

joe sod said:


> What about all the McMansions that have been and are still being built the length and breadth of the country, that only started in the 2000s , in the 70s and 80s it was just a bog standard 3 bedroom bungalow. These houses consume alot of materials and labour and result in less units being built, you don't see that anywhere else in Europe


Yes, another example of where the State is causing the problem. Ribbon development should never have been allowed.


----------



## AlbacoreA

Purple said:


> They are expensive because there’s a supply problem.



It's not as simplistic as that. If I want a mansion or grand large estate they are for sale. Want a modest sized apartment or average size family home almost nothing for sale in some areas. 

"...In its report, Daft noted that the total number of properties available to buy on its website – as of June 21st – was fewer than 12,500, up slightly from the March total (11,900), but down by more than 6,000 on the same period last year..."

When it comes to supply of so called "affordable" housing by the govt"

"...Just 400 affordable homes will be delivered next year under a government scheme launched three years ago that is supposed to deliver 6,200 homes to buy or rent...."


----------



## AlbacoreA

Then there's....









						Viewers slam RTE's new 'out of touch' housing programme - Extra.ie
					

Viewers who were tuned in to RTE on Monday night were understandably disgruntled when they caught the broadcaster's new housing programme.



					extra.ie


----------



## Purple

AlbacoreA said:


> It's not as simplistic as that. If I want a mansion or grand large estate they are for sale. Want a modest sized apartment or average size family home almost nothing for sale in some areas.
> 
> "...In its report, Daft noted that the total number of properties available to buy on its website – as of June 21st – was fewer than 12,500, up slightly from the March total (11,900), but down by more than 6,000 on the same period last year..."
> 
> When it comes to supply of so called "affordable" housing by the govt"
> 
> "...Just 400 affordable homes will be delivered next year under a government scheme launched three years ago that is supposed to deliver 6,200 homes to buy or rent...."


There's a big difference between a large home and an expensive home. Average 4 bed semi's with small gardens in places like Terenure in Dublin (ugly pebble-dashed houses) are selling for €750k-€800k. By no stretch of the imagination are they grand or could they be described as mansions.


----------



## Purple

AlbacoreA said:


> Then there's....
> 
> 
> 
> 
> 
> 
> 
> 
> 
> Viewers slam RTE's new 'out of touch' housing programme - Extra.ie
> 
> 
> Viewers who were tuned in to RTE on Monday night were understandably disgruntled when they caught the broadcaster's new housing programme.
> 
> 
> 
> extra.ie


Yea, it's a bit like running a cookery series on the State TV channel in South Sudan...


----------



## AlbacoreA

Purple said:


> There's a big difference between a large home and an expensive home. Average 4 bed semi's with small gardens in places like Terenure in Dublin (ugly pebble-dashed houses) are selling for €750k-€800k. By no stretch of the imagination are they grand or could they be described as mansions.



They are still in short supply. In many cases older properties also need extensive refurbishment in the order of 100k+. Even if you can get a builder to do it.

But it makes no financial sense to spend that amount on a modest size increase vs adding an extension, which is what many are deciding to do in cities. Also the bang for buck is extremely poor compared to buying out side the cities. The divide between urban and rural is ludicrous.


----------



## AlbacoreA

And all of this is having a knock on effect on landlords and rentals.


----------



## Purple

AlbacoreA said:


> They are still in short supply. In many cases older properties also need extensive refurbishment in the order of 100k+. Even if you can get a builder to do it.
> 
> But it makes no financial sense to spend that amount on a modest size increase vs adding an extension, which is what many are deciding to do in cities. Also the bang for buck is extremely poor compared to buying out side the cities. The divide between urban and rural is ludicrous.





AlbacoreA said:


> And all of this is having a knock on effect on landlords and rentals.


I agree with you but people want to live near friends and family, children want to stay in local schools etc. If you are relatively well off you have to move out of your locality to have a reasonably nice house. If you are very rich or moderately poor you can live where you want as you can either buy a house or have one given to you.


----------



## Sarenco

From the Q2 2021 RTB Rent Index -

On an annualised basis, rents grew by 7.0% in the second quarter of 2021 on a nationwide basis. This growth rate is higher than that of the previous quarter (4.4%) and the highest since Q1 2019 (which recorded growth of 7.4%).

At the same time, there has been a huge decline in the number of tenancies registered with the RTB in Q2 2021 (13,884) compared to Q1 2021 (16,085).

The puzzling thing is that I have yet to hear a single politician state the obvious - rent controls are hurting renters.


----------



## AlbacoreA

There are more renters (votes) than LLs.  Also even amongst people are neither of those, the LLs are the bad guy in all this. So more votes again. 

If they can shift the political fall out to LLs. It give the politicians a free pass.


----------



## NoRegretsCoyote

AlbacoreA said:


> There are more renters (votes) than LLs.


Yes, but not by much. Most landlords have one property, very few have more than two. I would say the ratio is something like 3 landlords to every 5 tenancies. That's not massively lopsided.

To alter Bill Clinton, "it's the tax, stupid". Gross rental yields are very high in Ireland so what is putting landlords off is the 52% tax that most of them pay. Also a lot of BTL mortgages have been paid down so there isn't a high interest bill to offset against tax for many any more.


----------



## kinnjohn

Sarenco said:


> From the Q2 2021 RTB Rent Index -
> 
> On an annualised basis, rents grew by 7.0% in the second quarter of 2021 on a nationwide basis. This growth rate is higher than that of the previous quarter (4.4%) and the highest since Q1 2019 (which recorded growth of 7.4%).
> 
> At the same time, there has been a huge decline in the number of tenancies registered with the RTB in Q2 2021 (13,884) compared to Q1 2021 (16,085).
> 
> The puzzling thing is that I have yet to hear a single politician state the obvious - rent controls are hurting renters.


To be fair Tom Barry TD from FG did state the above,


----------



## AlbacoreA

Still significant. 

You've no protection against the cost of bad tenant.


----------



## Jonocon12345

Is it legally permissable to pass on the RTB registraton fee to tenant?


----------



## Clueless Clive

No but its tax deductable, isn't it?


----------



## Paul O Mahoney

Clueless Clive said:


> No but its tax deductable, isn't it?


Yes it is.


----------



## PebbleBeach2020

All the kite flying seems to be about some package (taxation being just one element) being included in the Budget in October. With that in mind, what are the likely actions by the government do people think to retain, attract or entice "mom and pop" landlords to remain or invest in the sector?

Are we saying property tax will be tax deductible? Capital repayments off mortgages being tax deductible? Tax at the 20% or 40% rate only, that is, not liable for PRSI or USC? Ending of the RPZ system?


----------



## cremeegg

PebbleBeach2020 said:


> All the kite flying seems to be about some package (taxation being just one element) being included in the Budget in October. With that in mind, what are the likely actions by the government do people think to retain, attract or entice "mom and pop" landlords to remain or invest in the sector?
> 
> Are we saying property tax will be tax deductible? Capital repayments off mortgages being tax deductible? Tax at the 20% or 40% rate only, that is, not liable for PRSI or USC? Ending of the RPZ system?


I don't know where people are seeing this speculation, any links ?

Property tax deductable. Logically reasonable or simply just. Financially irrelevant its only a few hundred in the year.

Capital repayments. Logically unsupportable. Financially huge for some, irrelevant for others. It would favour those with large borrowings while giving nothing to those who bought with cash. It would probably attract many new landlords, who could borrow large amounts.

Ending PRSI. In the past rental income was seen as unearned income, i.e. not subject to PRSI (good) and not qualifying for pension relief (bad). In recent years this has been reversed, so removing PRSI would be a change of direction. Though probably a good thing.

Ending RPZ system. Well it could certainly be modified. No restrictions when a tenancy comes to an end seems the obvious one.


----------



## PebbleBeach2020

cremeegg said:


> I don't know where people are seeing this speculation, any links ?
> 
> Property tax deductable. Logically reasonable or simply just. Financially irrelevant its only a few hundred in the year.
> 
> Capital repayments. Logically unsupportable. Financially huge for some, irrelevant for others. It would favour those with large borrowings while giving nothing to those who bought with cash. It would probably attract many new landlords, who could borrow large amounts.
> 
> Ending PRSI. In the past rental income was seen as unearned income, i.e. not subject to PRSI (good) and not qualifying for pension relief (bad). In recent years this has been reversed, so removing PRSI would be a change of direction. Though probably a good thing.
> 
> Ending RPZ system. Well it could certainly be modified. No restrictions when a tenancy comes to an end seems the obvious one.


You want links??? Have you seen any news stations or read a paper the last month or so no?

Here you go:









						Tax measures may need review to keep landlords from exiting the rental market, says minister
					

Housing Minister Darragh O’Brien indicated that tax breaks may be needed to keep ‘mom-and-pop landlords’ from selling up.




					jrnl.ie
				












						Report claims rent controls have backfired and worsened crisis
					

Study claims rent pressure zones have added to rent pressures




					www.irishtimes.com


----------



## cremeegg

PebbleBeach2020 said:


> You want links??? Have you seen any news stations or read a paper the last month or so no?


I live under a rock.

Thanks for the links.


----------



## PebbleBeach2020

cremeegg said:


> I live under a rock.
> 
> Thanks for the links.











						Government to consider new tax breaks for small landlords
					

Seen and Heard: Move to halt exodus of smaller landlords, public-sector pay deal to be kept and Kennedy Wilson on Dublin's ‘buzzing’ rental market




					www.irishtimes.com
				




In case you didn't see that article in the Irish times today either


----------



## Sconeandjam

PebbleBeach2020 said:


> Government to consider new tax breaks for small landlords
> 
> 
> Seen and Heard: Move to halt exodus of smaller landlords, public-sector pay deal to be kept and Kennedy Wilson on Dublin's ‘buzzing’ rental market
> 
> 
> 
> 
> www.irishtimes.com
> 
> 
> 
> 
> 
> In case you didn't see that article in the Irish times today either


Too little too too late as anything they do now will be from next year. Also will it mean those landlords that have the rents already low below market rent be asked to drop even further? This is for long term indefinite  tenancies.


----------



## Paul O Mahoney

PebbleBeach2020 said:


> Government to consider new tax breaks for small landlords
> 
> 
> Seen and Heard: Move to halt exodus of smaller landlords, public-sector pay deal to be kept and Kennedy Wilson on Dublin's ‘buzzing’ rental market
> 
> 
> 
> 
> www.irishtimes.com
> 
> 
> 
> 
> 
> In case you didn't see that article in the Irish times today either


What defines "cheaper rent " our properties are between 30 and 50% of market value.

This will be another window dressing exercise,  HAP is going up and they want rents to go down..........

I'm serving quit notices on July 1st , no matter what they propose.


----------



## PebbleBeach2020

If you have a property rented at say €1400 and market rent is €2000, you have it at 30% discounted already. If that's the threshold you won't have to do anything. I would imagine if cost rental is upto 50% market rent then I'd say around 25-33% is the discount they would seek to maybe get taxed at 20% plus prsi and USC instead. This would help landlords who never raised rents previously due to good long term tenants and are now stuck in a RPZ area.


----------



## Paul O Mahoney

PebbleBeach2020 said:


> If you have a property rented at say €1400 and market rent is €2000, you have it at 30% discounted already. If that's the threshold you won't have to do anything. I would imagine if cost rental is upto 50% market rent then I'd say around 25-33% is the discount they would seek to maybe get taxed at 20% plus prsi and USC instead. This would help landlords who never raised rents previously due to good long term tenants and are now stuck in a RPZ area.


It might persuade some,  but they issues aren't taxation alone,  its tenancies and the rights that the state have given the tenants and enshrined it in law. I have good tenants but we want to sell one property and we must give them essentially 9 months notice to quit.

We are the lucky one, there are thousands of horror stories about tenants not leaving,   wrecking rental and essentially not caring about the owner or his/her rights.

When my high income disappeared due to cancer in 2008 and the world fell into a financial crisis our tenants asked for and got reductions when our family really needed to money. Interest was double the combined rent. 

The word " Landlord", you'd swear the 1/2 property landlord is depicted as the old Earl's and Dukes owing huge swathes of land and property and we are tossing families out on the street as during the famine, we are probably more hated than the black and trans, and this  narrative is getting worse year in year out.

We are Christian people who have and particularly in my case give time,money and anything else we can to those who need it, yet we are the evil ones.

Posts on AAM has seen  people explaining allowing low rent was a defacto reduction for long term tenants,  and you couldn't put the rent up or sell unless you give extended notices, the banks won't help, few auctioneers won't sell with sitting tenants, Insurance companies wriggle out  of claims due to clauses lawyers have hard times understanding ....the list is endless and frankly not worth it.

If they want more properties available for renting treat the owners with respect.
Respect our rights and our assets.
Respect us for helping with the mess that was created by Governments.

And call us something else.


----------



## Cavanbhoy

I am slightly confused as what bearing private landlords selling up has on the housing market.
As it is the house is rented if the landlord sells the house will be still lived in.
Therefore whether he sells or stays a landlord it wont have a difference on people looking for a home.
The only solution is new builds.
Or am I missing something


----------



## PebbleBeach2020

Cavanbhoy said:


> I am slightly confused as what bearing private landlords selling up has on the housing market.
> As it is the house is rented if the landlord sells the house will be still lived in.
> Therefore whether he sells or stays a landlord it wont have a difference on people looking for a home.
> The only solution is new builds.
> Or am I missing something


Let's say every landlord sells every rented property to an owner occupier. Where do all the renter's go then?

On a smaller scale, say there's 600,000 renters across 200,000 properties. Say 50,000 properties are sold. Now there's 600,000 renters but only 150,000 properties. Do you see the problem now?


----------



## Paul O Mahoney

Cavanbhoy said:


> I am slightly confused as what bearing private landlords selling up has on the housing market.
> As it is the house is rented if the landlord sells the house will be still lived in.
> Therefore whether he sells or stays a landlord it wont have a difference on people looking for a home.
> The only solution is new builds.
> Or am I missing something


Another point would be that  some people are renting due to financial constraints and would find it difficult to raise funds to buy a property and where would they find suitable housing if the rental sector shrank to a low level. 

While building our way out of this is part of the solution the lead time is very long. and becoming increasingly expensive


----------



## noproblem

Just a word on the supposedly new laws/rules, etc coming to the rental market. The Goverment can do all that they want to make it easier for people to rent out their houses, apartments and everything else. They can't (it seems) legislate for non payment of rent and there's a hell of a lot of that out there. Be very, very, aware of this if you're thinking of buying to rent. Oh, there's not a lot you can do about it either and it's one of many reasons the small property owner is leaving the market, but doesn't get mentioned a lot anywhere. Writing this on a bright, very warm sunny morning in Cyprus 23 deg. Just in case someone thinks I'm crazy to be up at an unhealthy time of day, it's just gone 8.15 am here, we're 2 hours ahead.


----------



## Paul O Mahoney

noproblem said:


> Just a word on the supposedly new laws/rules, etc coming to the rental market. The Goverment can do all that they want to make it easier for people to rent out their houses, apartments and everything else. They can't (it seems) legislate for non payment of rent and there's a hell of a lot of that out there. Be very, very, aware of this if you're thinking of buying to rent. Oh, there's not a lot you can do about it either and it's one of many reasons the small property owner is leaving the market, but doesn't get mentioned a lot anywhere. Writing this on a bright, very warm sunny morning in Cyprus 23 deg. Just in case someone thinks I'm crazy to be up at an unhealthy time of day, it's just gone 8.15 am here, we're 2 hours ahead.


This needs tougher legislation or some kind of meaningful arbitration not the years it takes to solve this as it does now. 

Enjoy that sunshine we visited Cork over the weekend rain was ferocious and the journey home to Kildare yesterday was painful.


----------



## Clueless Clive

A potential solution - govt pay for truant payments for the length of time it takes to get from start of arbitration to end of arbitration. Landlord doesn't suffer and tenant remains homed during the dispute. Would incentivize ensuring a speedy resolution.


----------



## PebbleBeach2020

Paul O Mahoney said:


> Enjoy that sunshine we visited Cork over the weekend rain was ferocious and the journey home to Kildare yesterday was painful.


Any trip to Kildare is painful imo


----------



## Nordkapp

Thread has gone somewhat offtrack in the last few posts. At a minimum:
1. Property tax must be made an allowable expense.

2. PRSI and the USC to be dropped.


----------



## Paul O Mahoney

Nordkapp said:


> Thread has gone somewhat offtrack in the last few posts. At a minimum:
> 1. Property tax must be made an allowable expense.
> 
> 2. PRSI and the USC to be dropped.


No it hasn't if you read the title. Taxation isn't the main reason why" landlords " are leaving despite record rents


----------



## Paul O Mahoney

PebbleBeach2020 said:


> Any trip to Kildare is painful imo


The new section of the M7 from Junction 9? was like a river it had stopped raining and she still had wipers on full. Dry surface road my ..........


----------



## Purple

Landlords are selling up because;

Accidental Landlords have recovered their losses.
Many of the people who bought investment properties 20 years ago are retiring and are selling up.
They are just cashing in their gains.
They are fearful that they will be unable to evict difficult tenants because, well, they know that it's just about impossible to do that.
They fear that the next government will change the law so that their tenant cannot be evicted even if the landlord is selling their property.
They just don't want the hassle anymore.
A combination of the above.


----------



## Mucker Man

Purple said:


> Landlords are selling up because;
> 
> Accidental Landlords have recovered their losses.
> Many of the people who bought investment properties 20 years ago are retiring and are selling up.
> They are just cashing in their gains.
> They are fearful that they will be unable to evict difficult tenants because, well, they know that it's just about impossible to do that.
> They fear that the next government will change the law so that their tenant cannot be evicted even if the landlord is selling their property.
> They just don't want the hassle anymore.
> A combination of the above.


We finalised the sale of our 'investment property' last week.
Accidental landlords, sold for €1k less than what we paid for it in 2007, tenants moved out last November, and we were afraid to rent again as we felt we'd have trouble getting the house back to sell in the future.
We had great tenants, no hassle, but the rewards were not there for the risks involved, especially after taxes were paid.


----------



## PebbleBeach2020

Mucker Man said:


> We finalised the sale of our 'investment property' last week.
> Accidental landlords, sold for €1k less than what we paid for it in 2007, tenants moved out last November, and we were afraid to rent again as we felt we'd have trouble getting the house back to sell in the future.
> We had great tenants, no hassle, but the rewards were not there for the risks involved, especially after taxes were paid.


was that the main/only reason for selling? Did you mind being accidental landlords? Would you have kept it for a pension purpose?

If someone asked you what do we need to do to keep you in the rental sector, would taxation have been an answer together with an ability to get vacant possession?


----------



## Mucker Man

PebbleBeach2020 said:


> was that the main/only reason for selling? Did you mind being accidental landlords? Would you have kept it for a pension purpose?
> 
> If someone asked you what do we need to do to keep you in the rental sector, would taxation have been an answer together with an ability to get vacant possession?


We were mainly worried that we'd get a bad tenant who would wreck the house, or just stop paying rent, and we'd be relying on the RTB to help.
We rented it for 8 years and it only washed it's face for 2 of those, so we were happy to exit the market.
In terms of pension, I think there are better opportunities out there for investment, where the government isn't constantly meddling. 

Vacant possession is a big issue for other similar landlords I have spoken to.

We had no choice really about being an accidental landlord, the house value dropped by 60% and I was made redundant, so we moved for work.


----------



## Cavanbhoy

PebbleBeach2020 said:


> Let's say every landlord sells every rented property to an owner occupier. Where do all the renter's go then?
> 
> On a smaller scale, say there's 600,000 renters across 200,000 properties. Say 50,000 properties are sold. Now there's 600,000 renters but only 150,000 properties. Do you see the problem now?


I see their is a housing problem.
But still feel that private landord issue is a red herring.
In your eg 200k properties 600k renters shortfall of 400k properties.
If 50k private landlords leave the market surely the hses will be purhased by the renters/state or institutional landlords and will be still accommodating 50k previous renters.
Thus just rearranging who actually owns the properties. With no net change.
In shortage of 400k people.


----------



## T McGibney

Cavanbhoy said:


> I see their is a housing problem.
> But still feel that private landord issue is a red herring.
> In your eg 200k properties 600k renters shortfall of 400k properties.
> If 50k private landlords leave the market surely the hses will be purhased by the renters/state or institutional landlords and will be still accommodating 50k previous renters.
> Thus just rearranging who actually owns the properties. With no net change.
> In shortage of 400k people.


Lots of renters house share with strangers, often with 3, 4 or more occupying the one place. Fewer owner occupiers do. So the more ex-rented homes are bought by ex-renter owner occupiers, the fewer people overall will be accommodated without an increase in supply.


----------



## PebbleBeach2020

Cavanbhoy said:


> I see their is a housing problem.
> But still feel that private landord issue is a red herring.
> In your eg 200k properties 600k renters shortfall of 400k properties.
> If 50k private landlords leave the market surely the hses will be purhased by the renters/state or institutional landlords and will be still accommodating 50k previous renters.
> Thus just rearranging who actually owns the properties. With no net change.
> In shortage of 400k people.


if that's the logic, perhaps you can explain why rents are going through the roof? Why there's the lowest supply/availability of rental property in the history of the state? What 25,000 landlords who have left the rental sector (RTB figures) since 2016 and yet the rental situation has gotten progressively worse every year since 2016??? By your logic, the 25,000 landlords who sold, it made no difference as the houses didn't disappear.

You logic isn't quite logical!


----------



## Cavanbhoy

PebbleBeach2020 said:


> if that's the logic, perhaps you can explain why rents are going through the roof? Why there's the lowest supply/availability of rental property in the history of the state? What 25,000 landlords who have left the rental sector (RTB figures) since 2016 and yet the rental situation has gotten progressively worse every year since 2016??? By your logic, the 25,000 landlords who sold, it made no difference as the houses didn't disappear.
> 
> You logic isn't quite logical!


Would that not be down to the fact that the supply of new homes been built each year for rent/owner occupier is less than the demand.


----------



## Cavanbhoy

T McGibney said:


> Lots of renters house share with strangers, often with 3, 4 or more occupying the one place. Fewer owner occupiers do. So the more ex-rented homes are bought by ex-renter owner occupiers, the fewer people overall will be accommodated without an increase in supply.


Cheers that makes sense.


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## Purple

PebbleBeach2020 said:


> if that's the logic, perhaps you can explain why rents are going through the roof? Why there's the lowest supply/availability of rental property in the history of the state? What 25,000 landlords who have left the rental sector (RTB figures) since 2016 and yet the rental situation has gotten progressively worse every year since 2016??? By your logic, the 25,000 landlords who sold, it made no difference as the houses didn't disappear.
> 
> You logic isn't quite logical!


Our population is growing faster than the supply of homes. 

It's a problem of success. Unfortunately our Government did a really good job of handling Covid and keeping the economy going. 

A good deep recession which causes large scale emigration and a proper pandemic, not that wishy-washy one we had recently, would sort it out.

That or we could accept that there's a down side to the upside.


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## noproblem

Might also be a good idea for councils to do an audit of their properties. So many one person renters given houses and other property that far exceeds one person status. I wonder how many are doing cash deals on renting out rooms in this "fiddle"? I'm told it's happening.


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## Paul O Mahoney

noproblem said:


> Might also be a good idea for councils to do an audit of their properties. So many one person renters given houses and other property that far exceeds one person status. I wonder how many are doing cash deals on renting out rooms in this "fiddle"? I'm told it's happening.


The highest HAP recipients are also single so I would imagine theres a lot of undeclared cash changing hands.


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## Purple

noproblem said:


> Might also be a good idea for councils to do an audit of their properties. So many one person renters given houses and other property that far exceeds one person status. I wonder how many are doing cash deals on renting out rooms in this "fiddle"? I'm told it's happening.


They are perfectly entitled to avail of the rent a room scheme. I posted in another thread that this amounted to the monetising of the excessive allocation of State assets by the recipient of that asset and the core problem was that misallocation... but they aren't breaking the law.


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## lff12

Agree there is a steady movement of landlords out of the market, but the problem is more that there are no "new" landlords coming into the market. There are two kinds of landlord selling up - those who've rented properties who are "retiring" and wish to cash in on capital values, and secondly there are tactical landlords, the "accidental" landlord so often spoke of, who tactically let former PPRs when they couldn't sell due to negative equity, but are reaching a point where the value has recovered sufficiently to break even or profit by selling.

Can't remember what the exact figure for mortgage draw downs for 20 years ago was for buy-to-let, but it was a lot more than the 1% there is now.
Some of this also related to fact that compliance has changed greatly in past 20 years, particular tax compliance, which in the light of the end of 1990s incentives (which ensured landlords came into the tax net) has left landlords with far less to write off tax against.

[edit - actual % of mortgages now BTL is 1.4% compared to 19.9% in 2006]


----------



## landlord

Don’t forget all the landlords who are selling now because of the “ hold for seven year and pay no capital gains tax“ deal for property purchased between 7 December 2011 and 31 December 2014. 
This was subsequently reduced to hold for four years but I’m sure a lot of landlords were not aware it was reduced. 
For me anyway the seven-year period has just completed and I am considering selling this particular property I bought seven years ago.


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## PebbleBeach2020

landlord said:


> Don’t forget all the landlords who are selling now because of the “ hold for seven year and pay no capital gains tax“ deal for property purchased between 7 December 2011 and 31 December 2014.
> This was subsequently reduced to hold for four years but I’m sure a lot of landlords were not aware it was reduced.
> For me anyway the seven-year period has just completed and I am considering selling this particular property I bought seven years ago.


what did you buy for and what will it sell for? to give an idea of the scale of the incentive to sell now.


----------



## PebbleBeach2020

I think this upcoming Budget is critical for the government to act to entice/reward/attract landlords to remain in and invest in the rental sector.

I think the crucial issues are:

1) taxation is too highly and unfairly punished mom-and-pop landlords with taxation rates of 52%. A flate rate at 35-40% would make a difference and stop pushing existing people over the edge.
2) properties below market rent and I mean way below market rent, need to be afforded some facility to bring the rents up. I would imagine that the landlord leaving the market are ones charging much lower than the average/headline rents in Ireland and due to being punished and limited to 2% increases year-on-year. Its for this reason, that new properties coming onto the market are charging/quoting far in excess of market rent because they are conscious of not being able to increase more than 2% a year going forward. I see 3/4 bed semis renting for 2500 euro in Cork when these should be 1500 max. If you have an existing landlord with rent of 1300euro a month who didn't increase rent for years due to a good tenant, that tenant now leaves, the landlord is likely/encouraged/motivated to sell up a property, and if they want, go in and buy a new property. The exit and entry costs would be covered within 12-18 months from the higher rent.
3) ability of landlord getting back vacant possession (stop threatening them that this shouldn't be allowed). And if a tenant stops payment of rent, the RTB should be siding with the landlord and not the tenant. If a tenant stops paying rent, it shouldnt take the guts of 2 years to get them out of the property. In many cases, they walk away scott free and never repay the outstanding rent. If they cause damage etc, there are no consequences either. This is just wrong and again, it's encouraging landlords, good landlords, to leave the market.

All the fannying about the edges with small changes. Do the above and you will entice landlords to remain and christ, maybe start attracting mom-and-pop landlords back into the market. Ireland are a nation of house owners, with a history of investment in property, so we should be doing better if the environment permits it. The government should be facilitating investment not discouraging it. All parties are part of the solution. It isn't one side the problem.


----------



## Groucho

I agree with all of the above - but I cannot see our floundering, invertebrate government having the cojones to take such steps as the howls of outrage from both the opposition and the homelessness industry would be heard as far away as Mongolia.


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## NoRegretsCoyote

landlord said:


> For me anyway the seven-year period has just completed and I am considering selling this particular property I bought seven years ago.


Exactly. As less and less of the paper gain is sheltered from CGT it acts like a de facto tax.

If you made a €100k profit over 7 years you can sell it now CGT-free and pocket the full gain.

But in three years only 30% of the gain is sheltered. So 3/10*33%*€100k=€10k in CGT. That's a big chunk (if not all) of your rental profit for the period.


----------



## lff12

Just to back up my point about there being no new landlords (outside of institutional funds which tbh are grossly exaggerated in terms of size and impact). Going by Michael Byrne's Week in Housing weekly newsletter the figure for buy to let lending is now currently 1.4% of mortgages whereas in 2006 it was 19.9%. Yes there is cash buyers (including councils) but these surely include owner occupiers and those buying-to-knock rather than BTL.


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## Sarenco

PebbleBeach2020 said:


> A flate rate at 35-40% would make a difference and stop pushing existing people over the edge.


A flat rate of that order would be a disaster for landlords with a low marginal tax rate (e.g. retired folk) and, IMO, would trigger a further exodus of landlords.

There are certain tweaks that could be made to the tax code (e.g. LPT should be a deductible expense, PRSI should not be levied on unearned income, etc.) but the more fundamental problem, IMO, is the regulatory framework.

If a landlord's costs (maintenance, insurance, etc.) are rising by 9%pa but rents can only be increased by 2%pa, it should be obvious that is not a viable long-term business. 

Add in the ineffective regime for resolving disputes and the risks inherent in operating a property rental business are simply too high for most folks.


----------



## lff12

VonHohenzollern said:


> Is it that apartments are not financially viable or that the margin of profit is smaller than other builds?
> 
> People are willing to live in many different types of accommodation and with demand so high; market forces may be driving the building of the more valuable housing types rather than apartments.


As of 2016 census, only 30% of apartments were currently owner occupied, which helps indicate that there is an aversion towards apartment buying by FTBs in particular (I suspect there is a small downsizing contingent buying high end apartments).


PebbleBeach2020 said:


> I think this upcoming Budget is critical for the government to act to entice/reward/attract landlords to remain in and invest in the rental sector.


As I said - the problem is as much about there being no new landlords than old ones exiting, and their reasons for leaving might not be just about taxation - most landlords are now in their 60s and reaching an age where they wish to cash in on capital appreciation rather than wait until they are dead. 


PebbleBeach2020 said:


> I think the crucial issues are:
> 
> 1) taxation is too highly and unfairly punished mom-and-pop landlords with taxation rates of 52%. A flate rate at 35-40% would make a difference and stop pushing existing people over the edge.


Point I keep making is that this is about income tax and not rental income per se. If you have no other income and rent out 2 or more properties at under 32k per annum you'll pay the lower rate of tax.


PebbleBeach2020 said:


> 2) properties below market rent and I mean way below market rent, need to be afforded some facility to bring the rents up. I hope imagine that the landlord leaving the market are ones charging much lower than the average/headline rents in Ireland due to been punished and limited to 2% increases year-on-year. Its for this reason, that new properties coming onto the market are charging/quoting far in excess of market rent because they are conscious of not being able to increase more than 2% a year going forward. I see 3/4 bed semis renting for 2500 euro in Cork when these should be 1500 max. If you have an existing landlord with rent of 1300euro a month who didn't increase rent for years due to a good tenant, that tenant now leaves, the landlord is likely/encouraged/rewards to sell up a property, and if they want, go in and buy a new property. The exit and entry costs would be covered within 12-18 months from the higher rent.
> 3) ability of landlord getting back vacant possession (stop threatening them that this shouldn't be allowed).


Are you actually suggesting that good tenants who have cared for properties over perhaps 8 or 10 years, and paid their rent on time, should now be punished with rent hikes of hundreds (or as you suggest, even a thousand euro!) just because you've enviously looked at daft and see other landlords are getting more than you are? If you want a bunch of tenants to come and tear you apart with their bare hands and put your decapitated head on a pike (along with the elected reps who enabled that), its a sure way to do so.


PebbleBeach2020 said:


> And if a tenant stops payment of rent, the RTB should be siding with the landlord and not the tenant. If a tenant stops paying rent, it shouldnt take the guts of 2 years to get them out of the property. In many cases, they walk away scott free and never repay the outstanding rent. If they cause damage etc, there are no consequences either. This is just wrong and again, it's encouraging landlords, good landlords, to leave the market.


I fully agree with this - but generally such tenants are evicted eventually, overholding does happen but currently we still have no fault eviction clauses where properties are being sold or reused for families (we had 2 such evictions in my tiny development here and the adult children and their families of the landlords now live there). In reality there is no legal protection where a sale is mooted or landlord wants to move in themselves, and populists are howling very loudly to remove these reasons, which I don't see current government giving in to.
The issue with tenants vanishing into the sunset leaving bills or unpaid rent is as old as the hills and long precedes PRS reforms here - I recall a bad tenant in one house I lived in leaving unpaid rent/bills of 1700 pounds behind as far back as 2001.


PebbleBeach2020 said:


> All the fannying about the edges with small changes. Do the above and you will entice landlords to remain and christ, maybe start attracting mom-and-pop landlords back into the market. Ireland are a nation of house owners, with a history of investment in property, so we should be doing better if the environment permits it. The government should be facilitating investment not dicouraging it. All parties are part of the solution. It isn't one side the problem.


There is little chance that someone who is approaching retirement now and can cash in value of anything from 150k after fixed rate CGT upwards right now with the market as is, rather than drip feed in rent at marginal tax rates over say 14 years, is going to be tempted to stay. The only thing that *might* change matters is a considerable drop in property values which makes sales less palatable, or a change in upfront requirements from the banks - which currently require a 30% deposit and charge an interest rate of 4.8% typically.


----------



## lff12

Sarenco said:


> A flat rate of that order would be a disaster for landlords with a low marginal tax rate (e.g. retired folk) and, IMO, would trigger a further exodus of landlords.
> 
> There are certain tweaks that could be made to the tax code (e.g. LPT should be a deductible expense, PRSI should not be levied on unearned income, etc.) but the more fundamental problem, IMO, is the regulatory framework.
> 
> If a landlord's costs (maintenance, insurance, etc.) are rising by 9%pa but rents can only be increased by 2%pa, it should be obvious that is not a viable long-term business.
> 
> Add in the ineffective regime for resolving disputes and the risks inherent in operating a property rental business are simply too high for most folks.


Since income tax is based on income why not have a separate "rental tax" based on the actual level of rent levied?
Thus - landlords charging a rental income of under 1k per month attract a lower tax rate than those who charge more than 2.5k per month?
So thus, someone who has 3 properties let at 800 per month each pays a net lower rate of tax than someone who has 1 property rented out for 2.4 per month?


----------



## lff12

I think there's another issue which is kind of an elephant in the room, but there was a "gold rush" element around property investing in the early 00s that left a lot of urban tales around with regard to debt, equity collapse, the actual reality of working as a landlord. People thought they were buying into some kind of get rich quick scheme, when the reality was that it required a lot of work people just didn't realise they would have to do, and dealing with people, in many cases difficult people. So there's been a huge backlash against the sector as a whole, worsened of course by the fact that so many people perceive the rents they pay now as being unfairly high.
I did a stint on contract in one of the foreign owned banks from 2014-2015 & recall from working with the arrears teams that more than half of their arrears cases involved BTL investors. There was a degree of hubris in the early 00s that encouraged people to not do the math with regard to property investment that has huge consequences now.


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## PebbleBeach2020

lff12 said:


> most landlords are now in their 60s and reaching an age where they wish to cash in on capital appreciation rather than wait until they are dead.


that's incorrect according the Residential Tenacies Board figures. Look them up for your information.



lff12 said:


> Point I keep making is that this is about income tax and not rental income per se. If you have no other income and rent out 2 or more properties at under 32k per annum you'll pay the lower rate of tax.


that would be rentals at approximately €1,300 a month. Where are these rentals at those rates? Outside the major urban centres anyway.




lff12 said:


> Are you actually suggesting that good tenants who have cared for properties over perhaps 8 or 10 years, and paid their rent on time, should now be punished with rent hikes of hundreds (or as you suggest, even a thousand euro!) just because you've enviously looked at daft and see other landlords are getting more than you are?


No i'm not. Did you read my post?! I didn't say to bring the rate upto market rent, I suggested to facilitate increases more than 2%. It's a fact, mom-and-pop landlords charge on average lower than average rents and significantly lower than market rent. This is about keeping supply up, its not about landlord milking it and screwing tenants to the wall. This is a two sided issue and it needs both sides to find the solution. If you want numbers, if you had a property rented at 1000 a month and market rent was 2000 a month, I think permitting a landlord to increase rents by 10% for a fixed number of years say 3 years instead of 2%  a year, would encourage at least some of these landlords to remain in the sector. The alternative is the tenants leave the property and it's sold, likely to an owner-occupier. Yes, the rent for the current tenants will be higher. But still well below market rent. I know many landlords and they are disgusted at the market rents at the moment. They wouldn't charge anything like that. But these same people rented long term and didn't increase the rents as the tenants were good. Now they are seeing the potential value of these property being reduced as low rents can adversely affect selling price and limit interested parties to purchasing. 

You seem to make out the relationship between landlords and tenants is a confrontational one and it's one or the other. I believe more can be gained through engagement and collaboration. There needs to be give on both sides and make it one for each. Not having the scales heavily biased to one side, be it tenant or landlord. That's no way to operate and continue.


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## PebbleBeach2020

lff12 said:


> I fully agree with this - but generally such tenants are evicted eventually, overholding does happen but currently we still have no fault eviction clauses where properties are being sold or reused for families (we had 2 such evictions in my tiny development here and the adult children and their families of the landlords now live there). In reality there is no legal protection where a sale is mooted or landlord wants to move in themselves, and populists are howling very loudly to remove these reasons, which I don't see current government giving in to.
> The issue with tenants vanishing into the sunset leaving bills or unpaid rent is as old as the hills and long precedes PRS reforms here - I recall a bad tenant in one house I lived in leaving unpaid rent/bills of 1700 pounds behind as far back as 2001.



I 100% believe that a landlord should be able to regain vacant possession of their property provided they give the tenants sufficient notice of this. Whether it's for selling or moving in themselves, I don't see the differentiation. The landlords rights as owner should be respected and adhered to.

Tenants have rights but they do not extend to possession of someone elses property indefinitely. Regardless of the rightful owners financial/personal/family circumstances. The constituents of the tenants (singletons or single parent with 3 children etc) doesn't make a difference. Again, this is a two sided transaction and each sides rights need to be respected and honoured, within reason.


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## PebbleBeach2020

lff12 said:


> There is little chance that someone who is approaching retirement now and can cash in value of anything from 150k after fixed rate CGT upwards right now with the market as is, rather than drip feed in rent at marginal tax rates over say 14 years, is going to be tempted to stay. The only thing that *might* change matters is a considerable drop in property values which makes sales less palatable, or a change in upfront requirements from the banks - which currently require a 30% deposit and charge an interest rate of 4.8% typically.


Again, you are back to the retired/retiring landlords. These do not make up the majority of mom-and-pop landlords in Ireland. Yes, if government can retain them in the sector, then excellent. They will contribute to the solution. But the majority should not be penalised and not enticed/rewarded/incentivised to remain in the sector for fear of upsetting the retirees and soon to be retired persons.


----------



## lff12

PebbleBeach2020 said:


> Again, you are back to the retired/retiring landlords. These do not make up the majority of mom-and-pop landlords in Ireland. Yes, if government can retain them in the sector, then excellent. They will contribute to the solution. But the majority should not be penalised and not enticed/rewarded/incentivised to remain in the sector for fear of upsetting the retirees and soon to be retired person.


from CSO
Age breakdowns are - 0-29, 30-44, 45-64 and over 65. You can be fairly sure that the 45-64 category is weighted heavily at the upper end.


StatisticRental YearAge GroupLandlord Tenancy SizeUnitValuePercentage RTB Landlords201765 years and overAll Landlords%16.4Percentage RTB Landlords201865 years and overAll Landlords%17.7Percentage RTB Landlords201965 years and overAll Landlords%19.0Percentage RTB Landlords202065 years and overAll Landlords%20.4Percentage RTB Landlords202165 years and overAll Landlords%22.0


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## Sarenco

PebbleBeach2020 said:


> So to suit retired folds who are landlords, we should keep a tax rate of 52% on rental income for all working landlords. That's a strange logic.


There are plenty of landlords that pay tax on their rental profits at an effective rate of far less than 52%.

For example, a single 66 year-old taxpayer with rental profits of €12,500 and no other income would pay precisely zero in tax.

If that person had €25,000 in total income, including rental profits, they would pay a grand total of €1,767 in tax - an effective rate of just over 7%.

Your proposal for a flat tax rate of 42% on all rental profits would be a disaster for taxpayers in those circumstances and would be grossly unfair.


----------



## NoRegretsCoyote

Sarenco said:


> For example, a single 66 year-old taxpayer with rental profits of €12,500 and no other income would pay precisely zero in tax.
> 
> Your proposal for a flat tax rate of 42% on all rental profits would be a disaster for taxpayers in those circumstances and would be grossly unfair.


Why is it so unfair to tax the same activity in broadly similar ways? LPT is like that, so is VAT. There are many unfairnesses built into how rental income is treated such as the approach to resident and non-resident landlords.

I am all in favour of taxing people on their income when it is a return on their effort like going to work every day. But being a landlord is largely a return on your capital, not your effort, and should be taxed as such. A flat 1% LPT on all occupied rental property would be extremely simple to administer and understand. It would create the right incentives for getting into the sector and staying in it.


----------



## Purple

NoRegretsCoyote said:


> I am all in favour of taxing people on their income when it is a return on their effort like going to work every day. But being a landlord is largely a return on your capital, not your effort, and should be taxed as such.


Can you clarify that please? Are you in favour of higher taxes on work and lower taxes on return on capital or vice versa?


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## PebbleBeach2020

lff12 said:


> from CSO
> Age breakdowns are - 0-29, 30-44, 45-64 and over 65. You can be fairly sure that the 45-64 category is weighted heavily at the upper end.
> 
> 
> StatisticRental YearAge GroupLandlord Tenancy SizeUnitValuePercentage RTB Landlords201765 years and overAll Landlords%16.4Percentage RTB Landlords201865 years and overAll Landlords%17.7Percentage RTB Landlords201965 years and overAll Landlords%19.0Percentage RTB Landlords202065 years and overAll Landlords%20.4Percentage RTB Landlords202165 years and overAll Landlords%22.0


so 78% of landlords are (in all likelihood) paying the top rate of tax. You have validated my point against your argument so. The government shouldn't be in fear of upsetting these 22% by incentivising and enticing the remaining 78% of landlords to remain and/or invest further in the rental sector. The 22% of landlords who are retirees may have other income such as pensions (state and private) and also be paying tax at the higher rate (albeit with reduced prsi and usc) but it would still benefit some of them.


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## PebbleBeach2020

lff12 said:


> from CSO
> You can be fairly sure that the 45-64 category is weighted heavily at the upper end.
> 
> 
> StatisticRental YearAge GroupLandlord Tenancy SizeUnitValuePercentage RTB Landlords201765 years and overAll Landlords%16.4Percentage RTB Landlords201865 years and overAll Landlords%17.7Percentage RTB Landlords201965 years and overAll Landlords%19.0Percentage RTB Landlords202065 years and overAll Landlords%20.4Percentage RTB Landlords202165 years and overAll Landlords%22.0


How can you be "fairly sure"? You can't use your opinion as fact.


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## NoRegretsCoyote

PebbleBeach2020 said:


> How can you be "fairly sure"? You can't use your opinion as fact.


I'm fairly sure that Revenue research from a few years ago showed that (on average) about a third of rental income was paid over in tax.

That suggests a mix of people paying zero from right up to the top marginal rate.


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## PebbleBeach2020

Sarenco said:


> For example, a single 66 year-old taxpayer with rental profits of €12,500 and no other income would pay precisely zero in tax.
> 
> If that person had €25,000 in total income, including rental profits, they would pay a grand total of €1,767 in tax - an effective rate of just over 7%.
> 
> Your proposal for a flat tax rate of 42% on all rental profits would be a disaster for taxpayers in those circumstances and would be grossly unfair.


you are focusing in on a retired person only. Just 22% of the landlords in Ireland in 2021.

it's not tax on rental profits either, it's tax on rental income that's charged (after allowable expenses are removed). There is a big BIG difference.

A flat rate I'm suggesting at doing something meaningful for the majority of landlords in Ireland. You example of a 66 year old singleton with absolutely no income other than a property rented for €1,041 a month, is far from the majority and more likely to be a frequency of less than 50 (I'm being generous with that arbitrary number I'm thinking too!!!)

If someone is paying 20% tax on rental income then I think they are getting a pretty good deal from government in terms of that. I would rather see government resources being directed to the majority of landlords aged under 65, working/earinng in full-time employment, who are being taxed upto 52% on rental income. I think a 10% reduction or more in this would have a major impact on peoples decision to sell or remain.

*It's not so long ago the government decided overnight to make rental income liable to PRSI and USC. So the effective tax went from 40% to 52%. To pay this tax, landlords had to increase rents 24% just to maintain their current income. This was neither fair on tenants or landlords, yet the only winners were the government in terms of extra taxation revenue. The only losers were tenants, in terms of higher rents. And the only ones who got the blame and nothing else was the landlords.*


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## PebbleBeach2020

NoRegretsCoyote said:


> I'm fairly sure that Revenue research from a few years ago showed that (on average) about a third of rental income was paid over in tax.
> 
> That suggests a mix of people paying zero from right up to the top marginal rate.


how many years ago was that? Prior to Revenue making rental income liable to PRSI and USC? Any link to same please?

The median would be a much better and informative insight than the mean. If you had six landlords and four were paying tax at the top rate of 52% and twowas paying no tax, the average would be 34.6%. However, the median would be 52%. The median is a lot more representation of a population than a mean.


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## NoRegretsCoyote

PebbleBeach2020 said:


> how many years ago was that? Prior to Revenue making rental income liable to PRSI and USC? Any link to same please?


Here it is.



> The total amount of gross rental income declared on residential properties in 2018 is of the order of €3,043 million, an increase of €195 million from 2017........ The total net profit declared was of the order of €1,933 million, while the net loss declared was of the order of €29.7 million. The amount of chargeable profit/loss is after expenses have been deducted but before any capital allowances or losses forward.



I had remembered it wrong. Gross rental is about €3bn, with a bit more than a billion as allowable expenses. Therefore profits is €2bn or so, it says nothing about tax.


----------



## Purple

PebbleBeach2020 said:


> It's not so long ago the government decided overnight to make rental income liable to PRSI and USC. So the effective tax went from 40% to 52%. To pay this tax, landlords had to increase rents 24% just to maintain their current income. This was neither fair on tenants or landlords, yet the only winners were the government in terms of extra taxation revenue. The only losers were tenants, in terms of higher rents. And the only ones who got the blame and nothing else was the landlords.


Excellent point. Any cost imposed on a landlord has to be grossed up and charged to the tenant.


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## PebbleBeach2020

yes it doesn't have anything on the rate of tax paid, if you want to correct your original post.

Remember, the median is a better measure of the central tendency of a group as it is not skewed by exceptionally high or low characteristic values.


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## PebbleBeach2020

NoRegretsCoyote said:


> Here it is.
> 
> 
> 
> I had remembered it wrong. Gross rental is about €3bn, with a bit more than a billion as allowable expenses. Therefore profits is €2bn or so, it says nothing about tax.


yes it doesn't have anything on the rate of tax paid, if you want to correct your original post.

Remember, the median is a better measure of the central tendency of a group as it is not skewed by exceptionally high or low characteristic values.


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## Leo

lff12 said:


> he figure for buy to let lending is now currently 1.4% of mortgages whereas in 2006 it was 19.9%.


An ever increasing proportion of the buy to let market are using institutional money to purchase, and this is not reflected in the mortgage numbers.


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## Sarenco

PebbleBeach2020 said:


> you are focusing in on a retired person only


Not really.

If the individual in my example was, say, 35 and had a total income, including rental profits, of €25,000, he would only pay tax at an effective rate of 12%.  A heck of a lot less than your suggested flat rate of 42%. 


PebbleBeach2020 said:


> it's not tax on rental profits either, it's tax on rental income that's charged (after allowable expenses are removed). There is a big BIG difference.


Rental income - allowable expenses = rental profit.  You know, what you pay tax on!


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## PebbleBeach2020

Sarenco said:


> If the individual in my example was, say, 35 and had a total income, including rental profits, of €25,000, he would only pay tax at an effective rate of 12%.  A heck of a lot less than your suggested flat rate of 42%.


So a 35 year old with an investment property but wages + rental income of €25000. That's realistic alright. He has no mortgage on this property either no?

He's barely even earning the dole equivalent outside of rental income????


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## Sarenco

PebbleBeach2020 said:


> That's realistic alright.


Of course it's realistic!

The taxpayer in my example might have a high-earning spouse and only works part time.  

Or might not work at all.

Just because a flat tax rate of 42% on rental profits might suit you, it doesn't mean that it would suit everybody.

Anyway, there is no chance of a flat tax rate being introduced on rental profits so this is all totally academic.


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## Purple

Sarenco said:


> Of course it's realistic!
> 
> The taxpayer in my example might have a high-earning spouse and only works part time.
> 
> Or might not work at all.


Or they inherited a place in a different part of the country from Granny and they rent it out while they are in college or they have decided that they just want to walk the earth for a few years or lots of other reasons.


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## Firefly

PebbleBeach2020 said:


> 1) taxation is too highly and unfairly punished mom-and-pop landlords with taxation rates of 52%.


As someone who bought their first pair of slippers in the past 12 months, I suppose I am now of the mom-and-pop cohort (which is a lot cuddlier than Gen X). For us, we could afford the shortfall between the mortgage and net income (after tax is paid). I would see it as a form of saving and would be a lot cheaper as it would keep herself out of BTs  . And I would reasonably expect the property to be worth something in 20 years time.

For us, the reason we're not investing is the risk of a bad tenant not paying the rent. It would be too great a risk, would bring on untold levels of stress, so just not worth it. Investing in a pension may/may not give the same returns, but it's zero effort on my behalf..


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## PebbleBeach2020

“I think also we’re conscious that a lot of smaller landlords are exiting the market. We’ve got to address that,” said the Taoiseach.

Article on the Journal about the upcoming budget. There's going to be something for small landlords, but what is the question.


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## landlord

PebbleBeach2020 said:


> what did you buy for and what will it sell for? to give an idea of the scale of the incentive to sell now.


It’s exactly doubled in value as seven years ago was pretty much the very bottom of the market.


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## PebbleBeach2020

landlord said:


> It’s exactly doubled in value as seven years ago was pretty much the very bottom of the market.


If 200k to 400k then yes it makes sense to sell and back free of CGT.

Would you consider going back in and buying again? Or no interest in being a landlord?


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## landlord

PebbleBeach2020 said:


> If 200k to 400k then yes it makes sense to sell and back free of CGT.
> 
> Would you consider going back in and buying again? Or no interest in being a landlord?


I have a dilemma regarding selling that property because I have above market average rent on that property, with fantastic tenants (on homeless HAP… therefore pretty much guaranteed income) where as my others are all below market average. However each year from now that I do not sell I eat into my CGT benefit.

I want to bump a post I made a while ago in another thread as it is so important this message gets out there……

RENTS ARE NOT AT RECORD HIGHS FOR THE VAST MAJORITY OF LANDLORDS !!!

I keep track of the number of rental properties on daft in Swords. A few years ago there were around 200 or more properties available. The last few weeks has averaged less than 10.
The SAMPLE of properties being used as a measure of rental prices is therefore tiny !!!
The vast majority of landlords are restricted by the rent pressure zone limitations and are achieving rents way below market average.
The tiny sample on daft often represent brand new landlords who are not subject to RPZ restrictions and landlords who ignore the restrictions knowing that no body is actively monitoring the rules. So rents as reported on Daft are jacked up according to whatever supply and demand will allow. So this market average rent is massively artificially inflated.


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## odyssey06

landlord said:


> I have a dilemma regarding selling that property because I have above market average rent on that property, with fantastic tenants (on homeless HAP… therefore pretty much guaranteed income) where as my others are all below market average. However each year from now that I do not sell I eat into my CGT benefit.
> 
> I want to bump a post I made a while ago in another thread as it is so important this message gets out there……
> 
> RENTS ARE NOT AT RECORD HIGHS FOR THE VAST MAJORITY OF LANDLORDS !!!
> 
> I keep track of the number of rental properties on daft in Swords. A few years ago there were around 200 or more properties available. The last few weeks has averaged less than 10.
> The SAMPLE of properties being used as a measure of rental prices is therefore tiny !!!
> The vast majority of landlords are restricted by the rent pressure zone limitations and are achieving rents way below market average.
> The tiny sample on daft often represent brand new landlords who are not subject to RPZ restrictions and landlords who ignore the restrictions knowing that no body is actively monitoring the rules. So rents as reported on Daft are jacked up according to whatever supply and demand will allow. So this market average rent is massively artificially inflated.



Some landlords are getting more than others - but for those who aren't getting the 'max':

Was there a time these landlords were getting a higher rent than they are currently getting?

_ps I'm not in favour of RPZ legislation as currently constructed, just something about your claim struck me as off_


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## landlord

odyssey06 said:


> Was there a time these landlords were getting a higher rent than they are currently getting?



Hey odyssey06,
Apologies if I am misunderstanding your question, but are you suggesting a landlord who was achieving for example €3000 per month a few years ago is now only getting €2000. I can’t think of too many cases where a landlord would be reducing the rent over time?


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## landlord

J


Sarenco said:


> Not really.
> 
> If the individual in my example was, say, 35 and had a total income, including rental profits, of €25,000, he would only pay tax at an effective rate of 12%.  A heck of a lot less than your suggested flat rate of 42%.
> 
> Rental income - allowable expenses = rental profit.  You know, what you pay tax on!


Just a suggestion to cater for those on the different tax rates…
Would it be feasible as an emergency measure for say the next 5 years to offer landlords the ability to reduce their gross rental income by say 30% for the purposes of calculating tax? That way all landlords benefit, regardless of their marginal tax rate.


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## DazedInPontoon

landlord said:


> I want to bump a post I made a while ago in another thread as it is so important this message gets out there……
> 
> RENTS ARE NOT AT RECORD HIGHS FOR THE VAST MAJORITY OF LANDLORDS !!!





landlord said:


> Hey odyssey06,
> Apologies if I am misunderstanding your question, but are you suggesting a landlord who was achieving for example €3000 per month a few years ago is now only getting €2000. I can’t think of too many cases where a landlord would be reducing the rent over time?


The sentiment of these two statements seems to contradict each other.

While you made some points about daft in the first quoted comment I don't think that rules out that rents are also at an all-time high. Both things can be true, right?


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## odyssey06

landlord said:


> Hey odyssey06,
> Apologies if I am misunderstanding your question, but are you suggesting a landlord who was achieving for example €3000 per month a few years ago is now only getting €2000. I can’t think of too many cases where a landlord would be reducing the rent over time?


Well yes that's kindof my point. Are there many landlords out there who are getting less than their own particular "all time high" for a property?
If so when were they getting higher rents? 2007? 
So while some landlords are getting higher rents than others, even for similar properties, there can't be many properties out there being currently rented for less than the "all time high" of the property.


----------



## landlord

DazedInPontoon said:


> The sentiment of these two statements seems to contradict each other.





landlord said:


> RENTS ARE NOT AT RECORD HIGHS FOR THE VAST MAJORITY OF LANDLORDS !!!



Yes sorry I didn’t word that very well.
I was trying to say that the average landlord is achieving rents way below the reported Daft record high rents.


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## llgon

odyssey06 said:


> there can't be many properties out there being currently rented for less than the "all time high" of the property.



While the rents may not have decreased I would expect that the rental profits have in a lot of cases, as the costs have increased. For example the service charge for an apartment I own has increased from €1950 in 2018 to over €3200 this year.


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## Greenbook

Have you seen the new termination rules coming in in the next week or so? 3 months notice for tenancies under six months. Further increases for notice for tenancies upto three years. For every termination, the notice must be served on the tenant and the RTB on the same day, otherwise it is invalid.


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## KOW

Anybody know what happens be it under RAS or the long term rental agreements when the contract ends with County Councils.
The property is leased to said county council who place tenant in property. What happens if the tenant gives the two fingers when contract ends.


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## lff12

llgon said:


> While the rents may not have decreased I would expect that the rental profits have in a lot of cases, as the costs have increased. For example the service charge for an apartment I own has increased from €1950 in 2018 to over €3200 this year.


Or more pertinently, the ability to reduce taxes via various allowances has greatly reduced.



KOW said:


> Anybody know what happens be it under RAS or the long term rental agreements when the contract ends with County Councils.
> The property is leased to said county council who place tenant in property. What happens if the tenant gives the two fingers when contract ends.


Not sure - council may have a clause whereby they can rent to a new tenant, but more likely the contract ends? You'd need to talk to someone who actually has a lease with the council.


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## Paul O Mahoney

odyssey06 said:


> Well yes that's kindof my point. Are there many landlords out there who are getting less than their own particular "all time high" for a property?
> If so when were they getting higher rents? 2007?
> So while some landlords are getting higher rents than others, even for similar properties, there can't be many properties out there being currently rented for less than the "all time high" of the property.


In 2007 we were getting €900 a month for both properties,  now we are getting €1400 a month each , same type of house over 2000sq feet and 5 bedrooms, one in Nass the other in Oranmore and they are certainly below market or as you say " all time high ".


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## Paul O Mahoney

KOW said:


> Anybody know what happens be it under RAS or the long term rental agreements when the contract ends with County Councils.
> The property is leased to said county council who place tenant in property. What happens if the tenant gives the two fingers when contract ends.


Very little data or actual facts about this but I would imagine its rolled up into the arrears figures that Councils and indeed Housing Associations publish.


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## Paul O Mahoney

lff12 said:


> Not sure - council may have a clause whereby they can rent to a new tenant, but more likely the contract ends? You'd need to talk to someone who actually has a lease with the council.


Councils do not "turf people out " , and I spoke with a councillor recently over a pint and she confirmed this.


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## Paul O Mahoney

Trying to remember which thread as there are so many,  but the legislation to take the arrears off payments from the government is still not passed, and its causing a huge issue,  I'm working from memory but arrears could be as high as €350m at 31st Dec 2020 but many think this is " reported" arrears and the actual figure is higher.


I don't want to jump to conclusions but over the last few months while doing research its impossible to tie up figures on any aspect of this issue.


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## Paul O Mahoney

llgon said:


> While the rents may not have decreased I would expect that the rental profits have in a lot of cases, as the costs have increased. For example the service charge for an apartment I own has increased from €1950 in 2018 to over €3200 this year.


But equally your tax liability has decreased and your asset value has increased.  Yes you will pay tax on the increase if you sell, but owing an asset that's essentially increasing by 10% plus pa , and you payments essentially static, and taxation reduced......its not a bad return.


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## llgon

Paul O Mahoney said:


> But equally your tax liability has decreased and your asset value has increased.  Yes you will pay tax on the increase if you sell, but owing an asset that's essentially increasing by 10% plus pa , and you payments essentially static, and taxation reduced......its not a bad return.


Are you my accountant? I only mentioned one expense but you seem to know it all .

You're way out in some of your assumptions though and reduced taxation is only due to reduced income.  Try giving someone a pay cut and tell them it's not bad, their tax liability will decrease.


----------



## Paul O Mahoney

llgon said:


> Are you my accountant? I only mentioned one expense but you seem to know it all .
> 
> You're way out in some of your assumptions though and reduced taxation is only due to reduced income.  Try giving someone a pay cut and tell them it's not bad, their tax liability will decrease.


Eh no I'm not your accountant and equally you gave only one example,  so I based my response on your post. 

If I am " way off on my assumptions " please correct me. I certainly didn't intend to upset you in anyway, if I did I apologise. 

However my post isn't that far away from the reality,  yes your income is lower,  as is your tax liability,  but surely the value of the underlying asset has increased too, or maybe not?

While I understand your income has declined and that pressure from a cashflow perspective I was trying to describe a holistic view. 


Again I apologise for any hurt I caused


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## bipped

Greenbook said:


> Have you seen the new termination rules coming in in the next week or so? 3 months notice for tenancies under six months. Further increases for notice for tenancies upto three years. For every termination, the notice must be served on the tenant and the RTB on the same day, otherwise it is invalid.


Read it on the RTB website. They should change the name to NEC (never ending changes).


Has this Rent Reduction Bill any chance of being passed or is it just noise?









						Rent Reduction Bill 2022
					

Act and Bill text



					www.oireachtas.ie


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## llgon

Paul O Mahoney said:


> Eh no I'm not your accountant and equally you gave only one example,  so I based my response on your post.
> 
> If I am " way off on my assumptions " please correct me. I certainly didn't intend to upset you in anyway, if I did I apologise.
> 
> However my post isn't that far away from the reality,  yes your income is lower,  as is your tax liability,  but surely the value of the underlying asset has increased too, or maybe not?
> 
> While I understand your income has declined and that pressure from a cashflow perspective I was trying to describe a holistic view.
> 
> 
> Again I apologise for any hurt I caused



No worries, no hurt caused. I'm not going to take the thread off-topic but lots of issues can arise which upset the best made plans. General assumptions may not hold true in a lot of situations related to property ownership. 

I didn't post looking for sympathy though. I was only giving an example of how rental profits are affected, if you read the post in the context of the thread.


----------



## Paul O Mahoney

llgon said:


> I didn't post looking for sympathy though. I was only giving an example of how rental profits are affected, if you read the post in the context of the thread.


I know but I find it more gentlemanly to give all the facts rather than focus on one issue. 

I too am a "landlord,"   unfortunately,  and understand that increases in costs don't necessarily flow through to hardship that is perceived. 

Thus my reply.


----------



## lff12

bipped said:


> Has this Rent Reduction Bill any chance of being passed or is it just noise?
> 
> 
> 
> 
> 
> 
> 
> 
> 
> Rent Reduction Bill 2022
> 
> 
> Act and Bill text
> 
> 
> 
> www.oireachtas.ie


on p1 it says "Luxury accommodation is excluded" which means that literally everything gets declared to be "Luxury accommodation" in order to bypass it. Its noise.


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## Greenbook

It won't be passed, it's a Richard Boyd Barrett, not a government Bill. But per the Bill REITs can continue to charge €5k for a three bed apartment - on the basis that they are renting to millionaires. The small private landlord will be confined to 25% of the median wage as rent. Shows where RBB's priorities lie


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## NoRegretsCoyote

Seems something similar happening in London according to the FT:



> Research from property site Zoopla found that rents increased by nearly 20 per cent in inner London in the first quarter of 2022, and by 10 per cent in outer London. That compares with growth of about 2 per cent in the first quarter of 2019............
> Supply of private rented accommodation has fallen sharply in London to a five-year-low after buy-to-let investors sold up or reduced their exposure during the coronavirus pandemic. On average, letting agencies had 11.8 homes to rent in the capital in the year to date, compared with 21.8 in the five years to 2021, a fall of 48 per cent, according to Zoopla. Richard Donnell, research director at Zoopla, said: “A lot of the focus has been on the sales market, but there’s actually an even greater supply squeeze in the lettings market and it’s worst in London.”


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