# Have Kildare CoCo reduced monthly rent allowance from €850 to €725 for new rentals?



## kildon (5 Jan 2012)

Have heard in the past couple of days that Kildare County Council have reduced the monthly rent allowance from €850 to €725 for all new lettings or renewals in 2012

has anyone else heard of this happening?


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## gipimann (5 Jan 2012)

The rent limits set by Dept of Social Protection for persons on Rent Supplement were reduced from Jan 1st.    The new limits can be found at the bottom of this webpage:

http://www.welfare.ie/EN/Schemes/SupplementaryWelfareAllowance/Pages/RentSupplement.aspx

I'm not sure if these limits are also used by councils for RAS (rental accommodation scheme), is this what you're referring to when you mention Kildare Co Co?


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## kildon (5 Jan 2012)

thanks for the link and yes that's what I'm refferring to


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## murphaph (13 Oct 2012)

*Fingal now as well*

Tenant received a letter from the DSP stating that she has until the end of the year to get me to reduce my rent (3 bed semi d in D15) to 775pm (currently 900 and not the most expensive 3 bed semi in the area if daft is anything to go by) or else she and her husband and child have to move out and find alternative accommodation.

Rents in D15 at least have held firm or even gone up a notch IMO (watch daft the odd time to see if I'm competitive) so I am confident I'm charging a very competitive rent. 

I checked daft to see what exactly one can rent for 775 in D15 and it seems you will get a 1 bed apartment. 2 bed units start at 800 (ok, many of those advertised might take 775). They are decent tenants, which has a value all of its own and which will have to be factored into any decision, but 125pm is 1500 per annum and I'm not so sure I want to absorb that sort of loss. Interesting times ahead. Not sure at the moment how to proceed tbh. so any thoughts are welcome.


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## superfan (14 Oct 2012)

My tenant's rent allowance has been cut by €60 a month this year,didn't want to lose her so reluctantly took the hit..


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## murphaph (14 Oct 2012)

Yeah I'm not totally un-receptive to the idea of a slight reduction (have reduced the rent several times for this tenant in the last 4 years tbh-was originally 1200 and now sits at 900, which as I say is definitely competitive) but a reduction of 125 pm (1500 per annum) is heavy going (just under 14%!!), especially as we all know our own costs as landlords have not come down one iota, quite the opposite in fact, would expect the govt to be looking for a grand in property taxes before long.

Gonna have to give this some serious consideration. I can't really understand what the government expects these families to do apart from squeeze into studio flats/bedsits or become homeless as rents simply aren't being floored by RS in the way the government suggested they were, at least not in D15. 

If there was some room for negotiation with the CWO I would be amenable to it, but not sure if there is. Their boy goes to school across the road, so moving to a different area would be tricky I suppose.


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## murphaph (14 Oct 2012)

Thanks Cashier, will make interesting reading. Was considering joining the RAS a couple of years ago. Will have to look into it again I think, or just get out of renting to RS tenants altogether.


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## oldnick (14 Oct 2012)

Murphaph

yes it's a crazy situation,especially for D 15 LLs who are expected to charge the same rent as, for example, LLs in Balbriggan - just because its all Fingal. 
Just as annoying for you is that LLs in ,say, Cabra can charge 100 euros more than for the same property in dearer Castleknock a mile or so along the Navan Road.

It is quite ridiculous and unfair. So you must get rid of the tenants asap if you believe you can get at least 900 elsewhere. Indeed, now is the time to charge more not less, especially with property charges coming. 

€775 is absolutely crazy from the LLs point of view (though from society's point of view why should a couple with one kid be provided with free accommodation in a three bedroomed house)-especially if ,with a tidy-up, you could earn one thousand a month - nearly three grand more a year than 775 p.mnth ! It's a no brainer.

It's tough on you living abroad especially if they're nice people with long established links in the area. But as you say there are two bedroomed apts which they may get at 775. Either they move or you lose thousands.

You could, of course, take 125 under the table in cash each month. Dodgy, because once you agree to 775 you can't turn round and kick them out if they don't give you the unoffical amount. Plus you could get into trouble. 

I wonder if the accommodation must be furnished for RA ? If furniture is not obligatory I wonder if you could charge 775 rent plus an extra amount for furniture? Does any poster know ?

I really believe you should tell them to leave.


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## oldnick (15 Oct 2012)

I thought that the RAS scheme makes no difference to the (lousy) rent given to LLs under the RA scheme.  In other words Murph still ends up with a meagre 775 euros for a three bedroom house in D.15., the main difference being that the council pays direct to LL.
Have I got that wrong?


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## twofor1 (15 Oct 2012)

I think a 15% - 20% reduction was mentioned here before, so under the RAS scheme Murph might only get between €620.00 - €658.75.

From the RAS landlord application form, 


*Rent Levels.*
Rents will reflect local market rents. However, housing authorities are charged with making savings on current rent supplement rent levels. The rent payable will be the subject of negotiation but rents may not exceed the current SWA rent supplement rent level and a reduction in that rent will be sought in return for:

1. The landlord not having to collect rents for the duration of the RAS contract;
2. The landlord not having to fill vacancies (advertise and interview prospective tenants) for the duration of the RAS contract;
3. The fact that the average yield across the private rented sector is 11 months rent per annum due to vacancies/tenant turnover;
4. The very bankable asset that a guaranteed RAS rent payment represents; 
5. Guaranteed prompt payment, in advance, by a State agency.
6. The fact that many landlords pay a letting agent the equivalent of one months rent per annum as a fee.

http://www.fingalcoco.ie/Housing/RentalAccommodationScheme/


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## oldnick (15 Oct 2012)

It gets worse and worse the more I read and learn about anything to do with dealing with the council.
If someone lets a decent property in a sought after area, and properly vets the private tenants  who pay by SO /DD every month then Murphaph would lose 20-30.000 euros over ten years dealing with the council. The lower figure would take into account  using letting agents and empty periods.
However, there shouldn't be empty periods if one has decent tenants who give good notice.  Out of my last one thousand letting month(properties x months) I doubt I've had a dozen empty months.

If a property was in a less desireable area and there was  a general decrease in demand for rentals (which is absoulety not the case at present) then I would amend my views.


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## murphaph (15 Oct 2012)

oldnick said:


> I thought that the RAS scheme makes no difference to the (lousy) rent given to LLs under the RA scheme.  In other words Murph still ends up with a meagre 775 euros for a three bedroom house in D.15., the main difference being that the council pays direct to LL.
> Have I got that wrong?


I would only get 775 because of the family composition: 2 parents + 1 child = max 775 in Fingal, not because of the house type. If I switched to RAS, I'd get the market rate less 8~12% for the house itself (minimum 900 pm IMO, but I have no idea how the council measure this, anyone??). The only question would then be whether or not the council allow my existing tenants to remain on where they are or would the council seek to populate the house with more bodies (family with 2+ kids).


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## oldnick (15 Oct 2012)

Murphaph - the council want to reduce costs , as per Twoforone's post. They won't pay   8-10% less than your estimate of current market rent.

The only way you can get more money than 775 from the cou8ncil is to rent it to a larger family. Two adults and one child means the council will not pay more ,whether RA or RAS , than around 775 euros.  
So, tell your tenants to quickly have twins or move out.

Anyway, why not phone the council now? -all details on the link in twoforone's post.

I bet you won't pleased with whatever they say.


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## dereko1969 (15 Oct 2012)

Slightly different case in that it was a house share but a friend of mine had awful difficulty renting out the spare room in her house (that she also rents) in D15. Had to reduce the rent 3 times as she just wasn't having any enquiries. 

The thing to remember is while it's €1500 pa of a reduction that's less than having the place empty for 2 months which could easily happen. I think there's an over-supply in D15 and I would suggest that the prices on DAFT are asking prices not actual renting prices.


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## murphaph (15 Oct 2012)

oldnick said:


> Murphaph - the council want to reduce costs , as per Twoforone's post. They won't pay   8-10% less than your estimate of current market rent.
> 
> The only way you can get more money than 775 from the cou8ncil is to rent it to a larger family. Two adults and one child means the council will not pay more ,whether RA or RAS , than around 775 euros.
> So, tell your tenants to quickly have twins or move out.
> ...


I don't know nick, I pick it up that they pay based on property type rather than the family composition of the first occupants (who might leave at any time) because the property could theoretically be occupied by anyone the council nominates during the contract. If they tried to offer ~700 I would tell them to take a running jump and exit the RS sector altogether.

With Fingal to even make an application to join the scheme, I have to get a BER and TC2 certs. The TC2 is obviously foc from Revenue but the BER will cost a little bit. I am actually curious about the BER and what improvements I can make there.


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## murphaph (15 Oct 2012)

dereko1969 said:


> Slightly different case in that it was a house share but a friend of mine had awful difficulty renting out the spare room in her house (that she also rents) in D15. Had to reduce the rent 3 times as she just wasn't having any enquiries.
> 
> The thing to remember is while it's €1500 pa of a reduction that's less than having the place empty for 2 months which could easily happen. I think there's an over-supply in D15 and I would suggest that the prices on DAFT are asking prices not actual renting prices.


You're absolutely right that the prices on daft would be asking prices but they have been creeping up (for my type of property anyway) over the past 12 months.

Last year I could find several houses for €800 (asking price). Now on daft I find one anomalous €800 unit and the rest start at €900 (although there are only a handful, then it goes up to €950).

I'm not surprised that rents are creeping up (for complete houses in Dublin anyway) as banks aren't lending and so more people are going to be looking at renting for the long haul. 

I am very pragmatic to be honest (have dropped rent already a few times to reflect market rates). If the market would tolerate less, my tenants would be pointing me to the evidence (as they have done before to secure rent reductions from me). My tenants have not once mentioned a rent reduction since last November or so. They haven't even explicitly asked for one now as they recognise that they are paying market rates or slightly better (IMO).


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## oldnick (15 Oct 2012)

murphaph - you are quite right that they pay for the size/type of property. But ,unless Fingal are different from the two councils I asked last year  - Dundalk and  Dublin city - once the council pay for a certain type of property it then installs families best suited to the size/type.

I'd be amazed if Fingal would pay  for a three bedroomed house only to allow your 2+1 family to stay.

However, I would be interested in what they tell you....


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## murphaph (15 Oct 2012)

I'm going to enquire with them anyway so I'll let you know. They might allow them to stay for a set period while they find something smaller for them under the RAS perhaps. It's such a mess, which could be much better run really.

I wouldn't mind -10% on market rate if the RAS was professionally organised and you were guaranteed not to be out of pocket for malicious damages by council tenants.


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## murphaph (18 Oct 2012)

Just to give you guys an update...
Contacted FCC and they told me that they would consider a contract tied to these tenants only (so they couldn't replace them with messers, which would be a huge concern of mine under RAS) BUT if I did that then I would only be eligible to receive the 2 bed rent (as the council considers 2 beds enough for 2 parents and 1 child, which it is in fairness!). They quoted me around the 840 mark, which is certainly better than the 775, but not quite market rates of course. 

I'll have to take all things into consideration: the downside is obvious, the house could probably get 900-1000 on the open market, but I'd almost certainly have some voids there.

The plus side is that I know these tenants very well and they are 110% reliable and if the day comes when I need possession again, I will get it no problem with these folks. No overholding rubbish to worry about. I can also speak frankly to them and tell them that I will be receiving under the odds for the house and that any decoration etc. that needs doing will have to be done by them (in the past, I have bought paint etc. for them to do it themselves but in the future they'd need to do that too, as there'd be 700 or so less per annum coming in.

The fact that I rely on a family member to manage the property is also a concern. It is not my place to burden them with extra hassle associated with unknown tenants and using an agent will see me lose at least 8% anyway.

I'm leaning towards the RAS if they accept the house onto the scheme at 840pm, but I know that wouldn't be for everybody, especially someone who can manage a property themselves and isn't reliant on family etc.


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## Dermot (18 Oct 2012)

Having followed your situation and taking everything involved in your particular situation I have to say go for the Ras. How long will the contract be for. Best of luck to you.


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## murphaph (18 Oct 2012)

I still have to formally apply and be accepted. If FCC turn around and say no (there was no mention of it from them, they seemed to be talking like it would be a formality but who knows) then unfortunately my tenants will have to seek something else. 775 is just too low and it's probably going to be cut again in December, so it's the RAS or nothing for these tenants. Let's hope it works out (have to get BER next week and TC2 from revenue before I can apply).


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## Dermot (18 Oct 2012)

I presume your tenants would be agreeable to go with RAS. Check with them and get them to check with the Council on all the details.  There can be a greater contribution by the tenant in some situations. Get them to put all their income ie SW and any other income on paper and to organise all paperwork in relation to their income before the go to meet the Council. They need to sort out their end as early as possible. There is no point in you having yourself organised and then find that they are not interested. You or your accountant can get the tax free clearance on line. Make sure you have tax situation up to date. Get quotes for your BER Cert.


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## murphaph (18 Oct 2012)

They'd be delighted to be able to stay Dermot. The last thing they want is to have to move into a 2 bed or God forbid smaller. I already have the BER guy lined up (doing it for €130, which is ok) and I'm organising the TC2 as well. No harm in having either of these things tbh. I'll get my tenants to get on to the council and see what they need from them. Even if they have to pay a bit more, they'll do it, rather than move to something smaller (they could never have family over etc. which they do regularly enough as it is as they can use the spare room).


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## Dermot (18 Oct 2012)

That looks like taking a weight off your mind. You got a good price for your BER Cert. That will last you 10 years anyway. Happy for you.


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## bacchus (19 Oct 2012)

Dermot said:


> I presume your tenants would be agreeable to go with RAS.



If you switch to RAS for which deposit is not required, does the landlord has to give deposit, if any, back to the tenant?


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