RPZ - Barrier to entry for Landlords looking to buy.
- Thread starter Knuttell
- Start date
In my opinion it is never wise to charge less than you can. A few years goes by, the rent falls further behind the market. You resent it and more to the point the tenant is trapped, they cannot afford to move out, and they resent it.
T McGibney
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I know of more than one person who bought BTLs in New Ross and deeply regretted it. It's a difficult part of the world to access if you're not in the south or south-east.
Exactly this. The law and regulation are such as to make it poor financial sense to do anything other than get max rent.
Each to their own I suppose, I have certain percentages that I want achieve. Once I achieve that, I am happy. My moral compass won't allow me to keep charging way above what is needed. I'm only in the game about 5 years but my methods are working quite well for me so far. Not to say that's the right route for everyone but I can only comment on how it's been dong for me.
I have never been to New Ross but the minimum wage is €11.30, for a 39 hour week that is €440.70 or €1,908 per month. That is €3,816 for 2 people.
€1,200 is 31% of €3,816 so a couple, on minimum wage, can rent a 2 bed apartment for just less than a third of their income.
According to https://www.housingagency.ie/housing-information/affordability-calculator
Housing cost affordability is measured by looking at the proportion of household income that is spent each month to meet the basic cost of accommodation. This internationally used way of assessing housing cost affordability suggests spending less than 35% of monthly disposable income on basic accommodation costs is generally affordable for most households.
Hardly a broken market.
It works out at 35% on the button once you take account of the small amount of tax paid on minimum wage. The bigger problem is paying that in New Ross!
so you don't understand my point!
The problem is when they change the rules and you don't achieve your "percentages" it will be too late to change.
You don't have to pay electricity etc., 2.7 of the Licence agreement says it is the responsibility of the tenant.
Hey, New Ross is a lovely place!
Waterford is only 15 mins down the road the town itself is very nice and the surrounding area has loads of lovely historical sites and gardens and other places of interest to visit. It gets a bad rep, I used to always make fun of it too, but I changed my opinion on it once I spent a little time there.Why are percentages in quotes?
Anyway, yeah that is a risk but I personally don't believe New Ross will ever be in an RPZ zone, so I'm going with gut on that one. Maybe I'll be proven wrong, can't say for sure on that one.
Yes, lots of lovely places 'near' New Ross. The town itself though... personally not where I would choose to live in a 58 sq metre apartment, or a run down 100 year old end of terrace.Hey, New Ross is a lovely place!
I recently sold an apartment and it was empty for 7-8 months before the sale went through. Can that time be included in the 2 years? It should help quite a bit if you are going for option 3!!
has to be unregistered at rtb for a full two years; so you'd need confirmation that last tenant vacated (say) 8 months before you purchased, then wait another 16 months before rental.
Well each to their own I suppose. We are very lucky to be able to choose where we want to live, not everyone is. I think it's a lovely little town but maybe I'm just a simple guy that's easily pleased.
Sorry, I didn't mean to be specifically hard on New Ross. But are those rents sustainable? I would imagine it was possible to rent a 3 bed semi for c.700 up the the end of 2018?
It looks like rents have gone from c. 70% of the national average to over 100% in that time frame. Is that the impact of being outside RPZ?
No need to apologise to me, I have no ties to the area other than property and the fact I like to go there for a coffee now and again!
Well, that probably deserves it's own thread. In fact I might make one for it. It's a question I've been mulling over for a while and discussing with several people in the industry. On the one hand, if you follow the simple laws of supply and demand, then I can't see how prices will come down because supply will not outweigh demand for some time to come. However, if you ignore supply / demand and just think about it for a moment and see the strain that standard couple are put under in order to afford a standard town house in a city / town outside Dublin now (circa say €1,400 per month), then the rates are going to have to at least plateau at where they are now if not fall slightly. However, as I mention, it's hard to see that happening if demand is so high.... tough question! Of course there are other factors to consider like government intervention, HAP, etc. etc. that add to the complexity.
"Is that the impact of being outside RPZ?" - another good question. It may very well have something to do with it, that's specifically why I started buying property there. Although for as long as I've been paying attention to BTL's I can remember New Ross pretty much tracking rents with it's nearest city, Waterford. They always seem to be on par in terms of what you get bang for your buck wise.
NoRegretsCoyote
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Rent for a 2-bed house in Wexford (which is a lot more than New Ross) is €8,46 in Q1 according to Daft. They don't have statistics on 2-bed apartments.
The only part of Wexford in an RPZ is Gorey which might be 15% of the stock in the county so what's on daft is pretty much the market price for new stock.
Daft doesn't give a national average but Wexford rents still seem cheaper than anywhere else in Leinster and Munster (save for Longford, Clare, and Tipp).