# Long term letting to County Councils.



## KOW (27 May 2020)

I have an apartment let to South Dublin County Council on the long term letting scheme.
I get 80% of the going rent for similar properties. Unlike RAS scheme SDCC manage the apartment repairs tenants etc. At the end of the lease which is for 8yrs my agreement/lease states that the apartment is handed back to me in original condition.
Can anybody who  availed of this scheme advise me how well their property was returned to them at end of lease. Cheers


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## cmalone (27 May 2020)

Expect - should be same as you gave - subject to normal use and age (8 years older)


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## dereko1969 (28 May 2020)

How old is that scheme? It may be too early for any properties to have been handed back yet.


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## Baby boomer (28 May 2020)

Variations of the scheme have been running for at least 15 years so there should be ample experience.  Dublin City Council's scheme has options to lease long-term for 10, 15 and 20 years.  They will pay 80% of market (they say Daft average for similar properties) rent or 85% if property has a service charge paid by the owner.  Rent is indexed to CPI at regular intervals. 

Interestingly, the rent is not subject to RPZ restrictions so it might suit a landlord trapped into a historically low rent level having done the decent thing by a long sitting tenant.  No RTB registration fee either.

I downloaded the draft long term rental agreement and it APPEARED to say that at the end of the lease period, DCC would not be responsible for handing back contents.  In practice, I suppose furniture would be written off and replaced after ten years anyway.

On the surface at least, it looks like an attractive option for a landlord that wants to be hands off.  A letting agent would be charging about 10% anyway, so an extra 5% to cover all voids and all repairs is a good deal. 

And it would also simplify record keeping and tax returns.

I'd be interested in hearing from anyone with practical experience.


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## llgon (29 May 2020)

Baby boomer,

@galway_blow_in has posted good information before on this scheme though not specifically on the point raised by the OP. See these threads:






						Key Post - How risky is property investment?
					

It's interesting to see the arc of this thread over 16 years.  Back in the early 2000s investors were basically accepting poor yields in the expectation of capital appreciation. This worked for some, but only if your timing was perfect.  Now, it is quite different. No one builds capital...



					www.askaboutmoney.com
				




Post 33 and after






						Lease to Council
					

Hi All,  Just wondering if anyone has had any experience with the below? It seems attractive to anyone wanting to retain a property for the future but doesn't want the day to day hassle of dealing with tenants (albeit on a reduced rent basis). Any thoughts...



					askaboutmoney.com


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## Baby boomer (1 Jun 2020)

Thanks, ligon


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## KOW (1 Jun 2020)

llgon said:


> Baby boomer,
> 
> @galway_blow_in has posted good information before on this scheme though not specifically on the point raised by the OP. See these threads:
> 
> ...



While Nobody has answered the question I have asked let me add experience to date.
On the scheme for past four years. All good paid on time every month. No dealings at all with the property. Just phoned up council regarding rent review after two years and no problems there.
Anyone considering the scheme please note in my case I was liable for any repairs etc for the first six months of my eight year lease.


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## Laststop (8 Jun 2020)

KOW said:


> While Nobody has answered the question I have asked let me add experience to date.
> On the scheme for past four years. All good paid on time every month. No dealings at all with the property. Just phoned up council regarding rent review after two years and no problems there.
> Anyone considering the scheme please note in my case I was liable for any repairs etc for the first six months of my eight year lease.




When you entered into the scheme, was there much negotiation over the rent figure? did they give a figure and it was take it or leave it? Did you rent a house or apt to them? How rigorous was their inspection of the property and finally how long was the process to get signed up ?  Thanks.


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## KOW (8 Jun 2020)

Laststop said:


> When you entered into the scheme, was there much negotiation over the rent figure? did they give a figure and it was take it or leave it? Did you rent a house or apt to them? How rigorous was their inspection of the property and finally how long was the process to get signed up ?  Thanks.


Hi Laststop, 
                 Rented an apartment to South Dublin CC.  They compared three properties in the area and we agreed what 80% of the average rent was. No problem there.
Inspection of property was straight forward as I had just renovated. Bit of paper work showing proof of ownership maintenance fees up to date. Electrician signing off all was to code etc. 
I had tenant in situation on the RAS scheme so I think it took about a month once everything was submitted to go from RAS onto Long Term Lease.
Hope that helps.


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## anntionette (16 Aug 2020)

Hi KNO, My mum is thinking about this scheme I’ll do the negotiations for her. So I’m just wondering if you could use your own Electriian or an up to date cert inspection that the electrics were up to code or do they insist on their own inspection? Thanks in advance


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## KOW (16 Aug 2020)

anntionette said:


> Hi KNO, My mum is thinking about this scheme I’ll do the negotiations for her. So I’m just wondering if you could use your own Electriian or an up to date cert inspection that the electrics were up to code or do they insist on their own inspection? Thanks in advance


As far as I can remember at the time they had a list of sparks that they approved. You choose   and arrange inspection etc. The sparks then sends report directly to Council.


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## Laughahalla (17 Aug 2020)

They need a 4 page report from an electrician (any qualified electrician in my case ). The electrician gave me the report and I just scanned and sent it to the council


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## galway_blow_in (25 Oct 2020)

one thing to be aware of is the local authorities have the right to sub lease the property to a third party who then manage the property instead of the council

they are often homeless charities or NGO,s who help rehouse people who have been in prison or substance abuse issues , my return on money has been very good in the nearly two and a half years but im not sure id do it with anything but a cheap property

in this country where the bleeding hearts get all resources , i think its too tempting for councils to use long term leases to house seriously dysfunctional people , ive only staked 72 k and ive already taken in over 23 k since july 2018 without spending a single penny but im still not sure id do it with a property costing more than even 120 k as i would not be sure the council would hand it back the way they got it , could easily see myself having to spend a years rent doing repairs after ten years , in my case il probably just extend the lease to twenty years but someone might not want to do that with a property costing 300 k ?


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## PebbleBeach2020 (25 Oct 2020)

Where did u get a house for 72k in 2018 that a council were interested in renting from you? It must be in a terrible area is it? Great ROI though.


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## galway_blow_in (25 Oct 2020)

PebbleBeach2020 said:


> Where did u get a house for 72k in 2018 that a council were interested in renting from you? It must be in a terrible area is it? Great ROI though.



limerick city and not st marys park or moyross etc ( town house ) , the house along with several each side of it flooded in 2014 , it was completely dry lined and refurbished by the time i bought it in september 2017 , houses a few doors up sold for 45 k in 20151 ( post refurbishment )  as that was before the flood prevention began , i thought of buying two at the time but talked myself out of it

since 2014 , limerick city council has erected significant flood defences in this area so i see the risk as worthwhile , granted if it ever flooded again , id be a fool


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## PebbleBeach2020 (25 Oct 2020)

Fair play. That was a great little investment.


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## galway_blow_in (25 Oct 2020)

PebbleBeach2020 said:


> Fair play. That was a great little investment.



well it might be too early to say yet for sure ?


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## PebbleBeach2020 (26 Oct 2020)

32% gross return in 2 years. I think I'll call it now.


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## NoRegretsCoyote (26 Oct 2020)

PebbleBeach2020 said:


> Fair play. That was a great little investment.



People don't realise how good the returns are on rental property in unfashionable places in Ireland.

Double digits in some places with deposits paying zero. It's worth the risk.


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## Villaines (10 Nov 2020)

Some recent experience on seeking to let a property to DCC under their LTL scheme:

Their standards are very high. Their surveyors will examine the property top to bottom and "issues" that have never caused a problem in 100+ years of occupation of the house by its owners/private tenants will be show-stoppers for the council. For example, very small gaps in the party wall in the attic of a 100+ year old house will not be acceptable, if the windows are big enough to meet fire exit requirements but are not very large they may request that hinges are changed to increase the opening area.
They offer no solutions in respect of the issues raised. Owner must resolve everything privately.
There is no list of contractors/surveyors/certifiers that they require you to use to meet the requirements they set.
The lease cannot be executed without appointing a lawyer. Presumably there is some sort of lien on the property that gets registered on the folio.
There is a requirement to obtain the "consent" of the lender if there is a mortgage on the property. However, there is no prescribed form or standard wording.
It is necessary to have the Council noted on the insurance policy, which the owner must retain. Some insurers may not be willing to provide insurance on a house let to the council/this type of letting may be regarded as riskier for the insurer and may attract a higher premium. The council offer no solution in this regard.
Full certification is required in respect of electricity supply, fire alarm systems and gas supplies. This must be 
The property has to have a D1 energy rating or better. This may increase in the future.
Oil/Gas boiler has to have been installed in the last 5 years or this is a show-stopper.
All white goods have to be less than 6 months old with receipts/guarantees even if they are in perfect working order/high-end models - must dump anything more than 6 months old and replace with new or lease will not proceed.
Council want a right of first refusal in event of sale of property during the lease term. This may mean the owner won't get full MV for the property if they have to sell.
Tax Clearance certificate, NPPR certificate of discharge, LPT record.
Exacting furniture requirements.
No negotiation on rental valuation offered.
No sense that there is a crisis of accommodation - if anything, they appear to have a good supply of property being made available and are in no rush to secure one-off properties.
Overall it's possibly simple enough for properties that have recently been refurbished from top to bottom, new builds or recently purchased buy to lets.

Has anyone gone through the process and if so, can they offer a ballpark for the cost of the legals, surveys etc.?


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## PaxmanK (21 Nov 2020)

Was just talking to someone who is doing this.
He let his apartment to Fingal CoCo 3 years ago on the LTL scheme for 10 years.
He said it was very straightforward in the end.
And about 3 months ago, realizing he would probably never live in the apartment again even after in another 7 years and is happy with 85% of market rent, he called them and asked did they want to change from 10 to 25 years.  And they agreed.  So no he is on a new 25 year LTL with them.  He is happy, they are happy.  Everybody is happy.
Which is more than I can say for landlords who I know who did rent allowance or HAP.


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## Brendan Burgess (21 Nov 2020)

PaxmanK said:


> Which is more than I can say for landlords who I know who did rent allowance or HAP.



Or private tenants who are being priced out of the market by the state.

Brendan


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## PaxmanK (21 Nov 2020)

Brendan Burgess said:


> Or private tenants who are being priced out of the market by the state.
> 
> Brendan



Thats true.  Councils buying up and leasing huge amounts of property at the moment.  Ordinary people cant get a look in at all. 
But the RPZs have forced landlords to go for the easy more secure option.  Makes you wonder if that was the intention of them all along.  Force landlords out or to just lease to the state.


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## galway_blow_in (22 Nov 2020)

Villaines said:


> Some recent experience on seeking to let a property to DCC under their LTL scheme:
> 
> Their standards are very high. Their surveyors will examine the property top to bottom and "issues" that have never caused a problem in 100+ years of occupation of the house by its owners/private tenants will be show-stoppers for the council. For example, very small gaps in the party wall in the attic of a 100+ year old house will not be acceptable, if the windows are big enough to meet fire exit requirements but are not very large they may request that hinges are changed to increase the opening area.
> They offer no solutions in respect of the issues raised. Owner must resolve everything privately.
> ...



Yes indeed , they go over the house with tooth comb prior to taking it on , making various demands for improvements which are borderline neurotic , once they then take over the house , they dont give a sh1t if the occupants wreck it within a week


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## SPC100 (22 Nov 2020)

I'm curious to the state they actually return them in after ten or twenty years. 

Can you inspect the interior during the lease?


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## PebbleBeach2020 (22 Nov 2020)

What about devaluing if the house? The area could take a downward turn with unsavoury tenants there for years.


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## 7 of 9 (23 Nov 2020)

If your tenant is already under the HAP scheme, can  you change to the Long Term Letting Scheme?


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## Leo (23 Nov 2020)

7 of 9 said:


> If your tenant is already under the HAP scheme, can  you change to the Long Term Letting Scheme?



No, LTL scheme houses those with insufficient means for HAP scheme.


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## misemoi (18 Jan 2021)

Picking up this thread again as I have a couple of questions.  We are investigating the possibility of purchasing an investment property for our children to live in for college/early years of working, on the basis that we would purchase near where they would likely attend or sell and purchase a new one if that turns out to be a different location. Still very early exploratory spreadsheet musings!

Has anyone exited such a scheme?  What happens to the tenants after say a ten year lease?  Are they made aware at the start that they will be moving eventually? Has anyone struggled with getting vacant possession at the end of the lease?  Would this be more likely if it is a house rather than an apartment on the basis that a house would be more likely used to house a family who would put down more roots, have children in local schools etc. 

Has anyone experienced difficulty in getting insurance cover for a property in this scheme?

Has anyone experienced difficulty in getting approval from a bank to enter the scheme, assuming the property is already on an investment rate and is up to date on payments etc?

Has anyone experienced issues in getting approval from the management company of an apartment block to enter the scheme?

I assume that under RPZ that the ending rent paid by the council becomes the baseline for rent going forward.  Any other impacts in that regard, or is this an incorrect assumption?  

Has anyone entered this scheme after first entering the Living City Initiative?  probably a question for the council as to whether the two are mutually exclusive.  Or in reality the standards required for the long term lease scheme would make it too expensive to renovate an older property.  

Thanks for any info!


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## Baby boomer (20 Jan 2021)

Good questions!  I'll have a go at the second last one.

Not sure about the ending rent being the RPZ baseline. The rent paid by the council to the landlord is definitely NOT subject to RPZ limits.  That would suggest the relationship between landlord and council is not a residential tenancy within the meaning of the Act and thus falls outside the RPZ rules entirely.


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## dereko1969 (21 Jan 2021)

misemoi said:


> Picking up this thread again as I have a couple of questions.  We are investigating the possibility of purchasing an investment property for our children to live in for college/early years of working, on the basis that we would purchase near where they would likely attend or sell and purchase a new one if that turns out to be a different location. Still very early exploratory spreadsheet musings!
> 
> Has anyone exited such a scheme?  What happens to the tenants after say a ten year lease?  Are they made aware at the start that they will be moving eventually? Has anyone struggled with getting vacant possession at the end of the lease?  Would this be more likely if it is a house rather than an apartment on the basis that a house would be more likely used to house a family who would put down more roots, have children in local schools etc.
> 
> ...


How old are your children? Presuming quite young if you're looking to rent out for 10 years.
I think the fact that no-one has probably exited the scheme yet should give you pause, is the scheme even 10 years old at this stage?
Why do you want to buy now rather than closer to the time of your children need the property?
Is it the case that *eventually *you'll want to buy them a place to stay near *potential *colleges that they might *potentially *go to? There are a lot of variables there where money is sunk for a decade, is the money burning a hole in your pocket at present?
If there's a referendum on the right to property who knows what impact that might have on long-term rentals.
For me it's way too early to do something like this on the promise of a maybe. Maybe your kids won't go to college, maybe they'll go abroad for education or jobs.


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## NoRegretsCoyote (21 Jan 2021)

dereko1969 said:


> Is it the case that *eventually *you'll want to buy them a place to stay near *potential *colleges that they might *potentially *go to?


If you:

Live somewhere like Laois, where Dublin is an obvious university choice, but not commutable; 
*and* have at least 2 children with aptitude for third-level;
*and* have a lot of free cash;
*and* don't mind the administrative and other hassle of being a landlord;
*then *it could suit you to buy an apartment in Dublin that your children might use in future.

But it's a lot of boxes to tick first.


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## misemoi (21 Jan 2021)

We will have cash soon to invest, are on top of our pensions and have a low LTV in a house that is suitable for our needs - this being the case if we can have an independent place for our children to live during early student life/ early adulthood, which will be in approx 10 years.  We are trying to find a low risk method of investing and this is one of the options...depending on finding the right property of course.  While we could manage being a landlord, we would prefer not to, but would be happy to do the admin of tax, insurance etc that is involved in the LTL scheme. 

In the event that they decide to follow the sun and head to Australia or elsewhere, the leases are extendable it would seem, or if the market was in a reasonable state we could sell.  And you can be sure that we would be charging our kids rent if they do live in our property (in fact we should set the rent lower than the stay at home option to incentivise it )

I am aware that laws, regulations etc can change, but so can pension levies, taxes etc.  We just have to make the best choice with the information and goals that we have at the time.  So posing the questions above so that we can gather as much info on the scheme as possible.  But I am all ears if there is something else we should consider that would allow us to achieve the same goals!


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## dereko1969 (21 Jan 2021)

How much will you have to spend on the property? There are apartments/houses suitable for LTL that might not be as suitable for your kids.
I'd probably pay off my home mortgage to leave wiggle room, a lot easier to raise a mortgage later if needed on your home than on an LTL property if you find yourself in a bind later on. Property is very illiquid.


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## OMG_OMG (27 Jan 2021)

I know someone who has been in this scheme for about 4 years now.
I was talking to him a couple of weeks ago and he was talking about contacting the council to extend it to 25 years.  He is currently 4 years into a 10 year contract.
He must be happy with it if he wants to extend it already without even having done half his first contract.


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## SPC100 (27 Jan 2021)

What exactly are 'structural issues' that you are responsible for?

E.g. say someone driver through a garden wall pillar? Or a large tree needs pruning? Or the garden wall falls in. Or significant fire or leak damage? Is that on you to do?


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## Laughahalla (9 Feb 2022)

OMG_OMG said:


> I know someone who has been in this scheme for about 4 years now.
> I was talking to him a couple of weeks ago and he was talking about contacting the council to extend it to 25 years.  He is currently 4 years into a 10 year contract.
> He must be happy with it if he wants to extend it already without even having done half his first contract.


Has your friend had a rent review after 3 years and if yes, what sort of increase percentage can be expected?


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## Laughahalla (6 Jan 2023)

Laughahalla said:


> Has your friend had a rent review after 3 years and if yes, what sort of increase percentage can be expected?



Raising this from the dead. - Has anybody had a review with the council yet and if yes, what % increase was given. Council are supposed to use HIPC but not sure how they calculate it and from what point in time it is calculated from.
Harmonised Indices of Consumer Prices (HICP) - Eurostat​
I'm guessing this calculator might be used but not sure what people are getting in reality





						Interactive Data Visualisations | CSO Ireland
					






					visual.cso.ie


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## HollyBud (6 Jan 2023)

2% each year


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