Tax Treatment of Landlords has to be Revisited

[T McGibney]

Well how did they build them in the 50's or the 60's or the 70's.

With cheap labour, almost to the point of slave labour. This was 50-70 years ago.
My father and uncle built their house in the 1950s. Their first task was to literally make the blocks, so their materials costs were very very low too.

If all you can say is "Go and learn some basic economics" when asked how the State is going to afford to do what you want, I can only assume that you simply don't know how it will.

Talking of a 100 year payback is nonsense. Social housing doesn't last 100 years, or the colour of it, without massive renovation and refurbishment.

 

[Allpartied]

Not true. Whatever the lease, the tenants have the security of permanent tenure after 6 months (that's the current law, before that it was 4 years and then 6 years) Residential Tenancies (Amendment) (No. 2) Act 2021. The only reasons that a LL can evict tenants after 6 months are if they want to sell, have a family member move in, or substantially renovate. (pretty much the same as in Germany where they can also have fixed-term contracts generally for less than a year).

Ok, so the landlord can evict if he wants to sell, thats substantially different from Germany.
The landlord can evict if he wants to renovate, also substantially different from Germany ( and, we know, widely abused).
So, two of your conditions are substantially different from the German laws, which are much more weighted towards the tenant. Fixed term contracts in Germany are rare, most are open ended, but can be terminated by the tenant, but not by the landlord.

 

[azerty]

"And, maybe, you can direct me to the legislation which allows tenants to, unilaterally, reduce the rent if they judge that the landlord is not maintaining or repairing the property." From experience, the wear and tear caused by tenants are much more than my family of 4. One of my tenants didn't inform us that there was an electrical fault in the electric shower and this could have literally fried her. It was mentioned to us in passing! The shower was replaced that day we were so concerned. We had extensive smoke damage and it took us a while to understand the sticky walls were like that due to tar. This is despite the fact that there is a clear clause of our lease and the apartment had been painted fully 2 years previously. Our last tenants did some unrepairable damage to the floor (but wear and tear!) and destroyed 2 mattresses that were so moldy that I would never have slept on them. They were there for 3 years and the accommodation is not moldy. They also damaged 2 feet of a brand new sofa in less the 6 months when we had the same one with no damages. There are regulations concerning the state of rented accommodation.
According to what I found: "ending your tenancy in Germany, Germany protects renters’ rights and it is very difficult for landlords to terminate a tenancy. Your contract can only be terminated on certain grounds, such as: Your landlord demonstrably requires the property for their own use (i.e. they want to sell the house)." So actually, only one difference.

 

[Firefly]

You should lookup the amount of unpaid rent due to the Local Authorities. They have no powers to collect unpaid rent and cannot evict, except for unsocial behavior.

Dublin City Council owed €38m in unpaid rent
Just over 64% of council’s 25,000 tenants in arrears and 41 owe more than €27,000

At the end of 2019, the council was owed €33,729,994 in unpaid rents. At the end of last year that had increased to €37,895,467.

The council’s average weekly rent charge is €71.09 or €309 per month.

Tenants are required to tell the council if their financial circumstances change, ie if they get a job or a pay rise, but Tara Robertson of the council's housing department said a significant number don't. "If income decreases people tell us, but when it increases that's not as likely."

Dublin City Council owed €38m in unpaid rent

Just over 64% of council’s 25,000 tenants in arrears and 41 owe more than €27,000

www.irishtimes.com

Olivia Kelly Dublin Editor
Fri Jan 21 2022 - 01:00

 

[imalwayshappy]

I don't understand why the government haven't called out SF policy of rent freeze and not allowing landlords vacant possession of their property when selling, as two factors that are spooking investment, driving existing landlords out of the market place and exaccerbating the problem further still.

This might actually be tactical by SF. Spook the market, worsen the the crisis, use it as a stick to beat the FFG at the election and hope its enough to gain a majority.....

 

[Greenbook]

I was, maybe, being a bit facetious with the total abolition suggestion. This is a scenario where private landlords might provide a service. Short term, single persons in high demand skillsets. Private landlords should be a niche market, providing, perhaps 5-10% of housing needs, to the well paid, high end,short term tenant.

They would apply for a council house/apartment like everyone used to in the 70's. When my parents were young, they had a choice of three properties, in various estates. Each house had three bedrooms, a garden and two toilets. They would pay a reasonable rent, have security of tenure and a well maintained house. They could then decide to purchase a private house or, maybe, they would stay in the house forever and live happily ever after.


She would just buy a house, as she would at the moment.

Again, he could buy a property. Or rent from the local authority/housing association.


If we are going to persist with the private landlord as the mainstay of housing in Ireland, then we need to legislate accordingly. Take the German model ( rather than the North Korean) and we might begin to create a society which values the citizen over the investor. The idea that legislation , in Ireland, is restrictive is for the birds. Landlords have absolute power in the relationship with their tenants. They can expel, without reason, after 6 months, or a year. They can neglect the house without sanction. ( unlike in Germany, where the tenant is protected from eviction and can reduce their rent if the landlord is negligent)
Some of the landlords, on this thread, are quoting the constitution, which protects their right to make money from the ownership of houses. They are right, because that principle is enshrined in the constitution. The right of a private landlord to make money is protected in our Constitution – but the right to housing is not. Something needs to change.

Your suggestion of a government agency to handle housing needs is not unprecedented. Local authorities provided such services for many decades. That should have continued and developed. But, some time in the 80's, the principles changed and housing became a method for people to make money, rather than an essential human right.

So, my suggestion, is for a widespread enlargement of the local authority housing stock, the development of not-for-profit housing associations and a minimal role for the private landlord.

Overall, I agree, the private rental sector should be a lot smaller than it is - too many people who should be in social housing or buying a house are stuck in it. This is largely the fault of the government and not landlords

With my examples - do you think two 25 year olds a carpenter and a teacher (probably on 80k combined) should be given a social house - presumably forever. They also live in Tuam.

The doctor and the separated accountant would presumably long term buy houses - but they should do so straight away? The doctor moving from Galway to Dublin must buy the first house she sees because otherwise she and her family are homeless. Likewise, the accountant, moves out of the family home and immediately buys a new house for himself. Much more feasible to rent in the PRS and then buy when the dust settles in both cases.

Other points in your reply:

1. Yes, councils should have a larger role. A lot of the problem is that councils stopped having a role in housing. But are you saying that they should be sourcing housing everyone unless they are, as you say, (a) single (b) looking for short term accommodation so presumably six months or a year (c) high skill set. That leaves a large swathe of the population whom the councils must source/build, fit out, furnish, maintain and repair housing for.

2. A landlord can expel a tenant here for any reason whatsoever after 6 months? Not the case at all - a tenant can only be expelled for sale, extensive renovation, family member moving in or breach of lease terms. Otherwise, tenants can stay in the property for as long as they want, in effect for life if the wish. The German system is different. 10 year leases are very common, but that lease need not be renewed by the landlord and the tenant must then move out at the end of the 10 year period.

3. Landlords can neglect the house without sanction - read the legislation and the RTB reports - landlords sanctioned all the time and made compensate their tenants. Tenants who destroy the property - it does happen - face no sanction

 

[Allpartied]

There are regulations concerning the state of rented accommodation.
According to what I found: "ending your tenancy in Germany, Germany protects renters’ rights and it is very difficult for landlords to terminate a tenancy. Your contract can only be terminated on certain grounds, such as: Your landlord demonstrably requires the property for their own use (i.e. they want to sell the house)." So actually, only one difference.

The ie; they want to sell the house bit, is not, entirely, accurate.
Landlords, in Germany, cannot evict tenants just to sell the house. They can only evict, with very strict and lengthy timelines, if they are going to move in themselves and live in the property. This discussion gives an indication of the difficulty German property owners have when trying to evict tenants, even when the owner has died.

Questions of rights when landlord wants to sell...

Hi, Last year, our landlord unfortunately and suddenly died and the outcome of Erbengemeinschaft's deliberations were that the flat in which we live should...

www.toytowngermany.com

 

[Greenbook]

Not true. The vast majority of rental agreements in Ireland are 12 months or less. At the end of which the landlord can turf a family out with no reason. Landlords in Germany, use open ended leases and can only evict a tenant if they are going to live in the property themselves. They can't evict a tenant to sell the property.
And, maybe, you can direct me to the legislation which allows tenants to, unilaterally, reduce the rent if they judge that the landlord is not maintaining or repairing the property.

No they cannot. Landlord can put a year in the tenancy agreement alright, but the legislation overrides that. What is called a Part 4 Tenancy comes into existence after the end of the first six months. The only grounds for eviction then are sale, required for family member, extensive renovation (increasing floor area by 25% or moving BER up 7 notches) or breach of tenancy terms.

A landlord cannot turf out a family at the end of year simply because the tenancy agreement says so. That is an illegal eviction and the landlord would be sanctioned and made pay compensation to the tenants for doing so. He/she would also have to reinstate them in the property if possible. Read the RTB website and/or Citizens Advice

 

[NoRegretsCoyote]

Dublin City Council owed €38m in unpaid rent
Just over 64% of council’s 25,000 tenants in arrears and 41 owe more than €27,000

Apparently a lot of these arrears are due to improved circumstances.

Differential rents are based on your income. If your income increases you're supposed to tell DCC but many tenants don't. Arrears can be quite substantial when correct income figures are worked out.

 

[Greenbook]

The ie; they want to sell the house bit, is not, entirely, accurate.
Landlords, in Germany, cannot evict tenants just to sell the house. They can only evict, with very strict and lengthy timelines, if they are going to move in themselves and live in the property. This discussion gives an indication of the difficulty German property owners have when trying to evict tenants, even when the owner has died.

Questions of rights when landlord wants to sell...

Hi, Last year, our landlord unfortunately and suddenly died and the outcome of Erbengemeinschaft's deliberations were that the flat in which we live should...

www.toytowngermany.com

Tenancies in Germany - not quite as pro-tenant as you make out. Also, rent increase capped at a max of 20% every three years! Here it is 2% per annum

Rental contracts & Housing rights in Germany – 2022 Guide​

 

[The Horseman]

The ie; they want to sell the house bit, is not, entirely, accurate.
Landlords, in Germany, cannot evict tenants just to sell the house. They can only evict, with very strict and lengthy timelines, if they are going to move in themselves and live in the property. This discussion gives an indication of the difficulty German property owners have when trying to evict tenants, even when the owner has died.

Questions of rights when landlord wants to sell...

Hi, Last year, our landlord unfortunately and suddenly died and the outcome of Erbengemeinschaft's deliberations were that the flat in which we live should...

www.toytowngermany.com

Every point you have made has been disproved. Can I suggest you do some research before making spurious claims that are incorrect.

 

[PebbleBeach2020]

This might actually be tactical by SF. Spook the market, worsen the the crisis, use it as a stick to beat the FFG at the election and hope its enough to gain a majority.....

that's 100% the tactic. What I don't understand is why FG or FF haven't called them out on it and stated it for the lay man what SF rhetoric is doing to the market/problem.

 

[Always Learning]

Not true. The vast majority of rental agreements in Ireland are 12 months or less. At the end of which the landlord can turf a family out with no reason.

Are you joking or do you genuinely have no clue?

 

[Allpartied]

Every point you have made has been disproved. Can I suggest you do some research before making spurious claims that are incorrect.

My points The vast majority of rental agreements in Ireland are 12 months or less.

My research: Just read Daft.ie

My point: Landlords can turf tenants out, with little protection.

My research : The quoted Threshold Report

Landlords pretend to renovate houses in a bid to unlawfully vacate tenants

LANDLORDS are claiming to renovate properties in a bid to unlawfully vacate tenants from rental properties and hike rents, says the watchdog for the rental sector. The annual Threshold report for 2…

www.thesun.ie

My point Protection for tenants, in Ireland, is inferior to most European countries. This is particularly true in terms of security of tenure.

My research: This is slightly subjective, but as an additional piece of research, I hope it meets with your approval.

Rootlessness: How the Irish private rental sector prevents tenants feeling secure in their homes and tenant’s resistance against this

Ireland’s housing situation in the 2020s is similar to many other Anglophone countries, including Australia and the UK: A deepening housing crisis, an…

www.sciencedirect.com

No they cannot. Landlord can put a year in the tenancy agreement alright, but the legislation overrides that. What is called a Part 4 Tenancy comes into existence after the end of the first six months. The only grounds for eviction then are sale, required for family member, extensive renovation (increasing floor area by 25% or moving BER up 7 notches) or breach of tenancy terms.

A landlord cannot turf out a family at the end of year simply because the tenancy agreement says so. That is an illegal eviction and the landlord would be sanctioned and made pay compensation to the tenants for doing so. He/she would also have to reinstate them in the property if possible. Read the RTB website and/or Citizens Advice

Sure thing.

I suggest you read the Threshold Annual report, which shows widespread abuse of the safeguards.

Pretending to renovate, pretending to sell, all that garbage.

Dr Rory Hearne: It's simple - the Government favours landlords and investors over renters

The housing expert says the broken rental market in Ireland is down to years of failed political policy.

www.thejournal.ie

 

[Greenbook]

My points The vast majority of rental agreements in Ireland are 12 months or less.

My research: Just read Daft.ie

My point: Landlords can turf tenants out, with little protection.

My research : The quoted Threshold Report

Landlords pretend to renovate houses in a bid to unlawfully vacate tenants

LANDLORDS are claiming to renovate properties in a bid to unlawfully vacate tenants from rental properties and hike rents, says the watchdog for the rental sector. The annual Threshold report for 2…

www.thesun.ie

My point Protection for tenants, in Ireland, is inferior to most European countries. This is particularly true in terms of security of tenure.

My research: This is slightly subjective, but as an additional piece of research, I hope it meets with your approval.

Rootlessness: How the Irish private rental sector prevents tenants feeling secure in their homes and tenant’s resistance against this

Ireland’s housing situation in the 2020s is similar to many other Anglophone countries, including Australia and the UK: A deepening housing crisis, an…

www.sciencedirect.com

Sure thing.

I suggest you read the Threshold Annual report, which shows widespread abuse of the safeguards.

Pretending to renovate, pretending to sell, all that garbage.

Dr Rory Hearne: It's simple - the Government favours landlords and investors over renters

The housing expert says the broken rental market in Ireland is down to years of failed political policy.

www.thejournal.ie

It is against the law, illegal etc. to evict a tenant at the end of a year long tenancy. The landlord can certainly grant a year long tenancy, but he/she cannot evict at the end of that period. The Residential Tenancies Acts apply, no matter what the lease says. After 6 months a landlord can only evict for the four stated grounds. That is the law. It has been the law since 2004. If you do not believe me check with Threshold, Citizens Advice or a solicitor. No point contacting the RTB, you will not get a reply.

Our tenancy protections are on par with those in Europe - in fact we seem to have followed the German system. Indefinite tenancies after a certain period with evictions on the four grounds only.

Everything you have quoted is various people with agendas such as Rory Hearne (an People before Profit candidate) who make lots of noise about tenants lacking rights but never talk about the specifics in the legislation.

As I said, if you do not believe me (and I'm sure you don't) contact Threshold or Citizens Advice. They will tell you precisely as I am telling you.

 

[Allpartied]

Overall, I agree, the private rental sector should be a lot smaller than it is - too many people who should be in social housing or buying a house are stuck in it. This is largely the fault of the government and not landlords

I never blamed landlords for exploiting the system to line their pockets. Of course, they will do that and they are doing it, largely at the expense of the taxpayer, who has to subsidise their rents.

2. A landlord can expel a tenant here for any reason whatsoever after 6 months? Not the case at all - a tenant can only be expelled for sale, extensive renovation, family member moving in or breach of lease terms. Otherwise, tenants can stay in the property for as long as they want, in effect for life if the wish. The German system is different. 10 year leases are very common, but that lease need not be renewed by the landlord and the tenant must then move out at the end of the 10 year period.

A landlord can expel the tenant for the reasons you mention. These reasons may seem perfectly valid to the landlord. His brother is coming back from Australia, or he wants to cash in and sell. But to the tenant it is being turfed out and they must try to build a home somewhere else, with all the stress that involves. That fear hangs over many tenants in the private sector. So, my suggestion is simply that more of the housing stock should be provided by local authorities, or not-for-profit housing associations. The tenants would then have increased secuity of tenure, a reasonable controlled rent and access to professional maintenence.

3. Landlords can neglect the house without sanction - read the legislation and the RTB reports - landlords sanctioned all the time and made compensate their tenants. Tenants who destroy the property - it does happen - face no sanction

There is a difference between neglect ( holes in the roof, rat infestations) and the tired , worn look of rental properties. Landlords, necessarily, will do the absoloute minimum and there is no sanction for that. But many don't even do that and they get away with it more often than not.

 

[Allpartied]

It is against the law, illegal etc. to evict a tenant at the end of a year long tenancy. The landlord can certainly grant a year long tenancy, but he/she cannot evict at the end of that period. The Residential Tenancies Acts apply, no matter what the lease says. After 6 months a landlord can only evict for the four stated grounds. That is the law. It has been the law since 2004. If you do not believe me check with Threshold, Citizens Advice or a solicitor. No point contacting the RTB, you will not get a reply.

Our tenancy protections are on par with those in Europe - in fact we seem to have followed the German system. Indefinite tenancies after a certain period with evictions on the four grounds only.

Everything you have quoted is various people with agendas such as Rory Hearne (an People before Profit candidate) who make lots of noise about tenants lacking rights but never talk about the specifics in the legislation.
%As I said, if you do not believe me (and I'm sure you don't) contact Threshold or Citizens Advice. They will tell you precisely as I am telling you.

The landlord can evict if his brother wants to move in. 3 months notice. Or he wants to sell, 3 months notice.
Or he is going to renovate, 3 months notice.

I understand that this is what needs to happen in the private sector, but it is this overreliance on the private landlord, that is the problem. They will, necessarily, treat the property as an asset. The tenant as a source of income, until they are not needed anymore.

I grew up in local authority housing and it was a godsend. We never had to worry about moving, or being turfed out. As long as my mother paid the rent, adhered to the rental agreement, we stayed. That stress, at least, was removed. So, we grew up, in a stable, clean, , well run and well maintained home. We regarded it as our home and treated it as our home.

It is common, these days, for families to be moved on, several times, in a 5 or 10 year period. I cannot imagine the stress that creates, not to mention the expense.

 

[azerty]

The landlord can evict if his brother wants to move in. 3 months notice. Or he wants to sell, 3 months notice.
Or he is going to renovate, 3 months notice.

I understand that this is what needs to happen in the private sector, but it is this overreliance on the private landlord, that is the problem. They will, necessarily, treat the property as an asset. The tenant as a source of income, until they are not needed anymore.

I grew up in local authority housing and it was a godsend. We never had to worry about moving, or being turfed out. As long as my mother paid the rent, adhered to the rental agreement, we stayed. That stress, at least, was removed. So, we grew up, in a stable, clean, , well run and well maintained home. We regarded it as our home and treated it as our home.

It is common, these days, for families to be moved on, several times, in a 5 or 10 year period. I cannot imagine the stress that creates, not to mention the expense.

Once again, your understanding of tenancy law is lacking. The only time for 3 months notice is for less than 6 months tenancy. Then the notice increases to152, 180, 196 and 224 days.
I don't think anyone argued that social housing need to increase. However you floated the idea that LL could be in some way expropriated!

 

[Greenbook]

The landlord can evict if his brother wants to move in. 3 months notice. Or he wants to sell, 3 months notice.
Or he is going to renovate, 3 months notice.

I understand that this is what needs to happen in the private sector, but it is this overreliance on the private landlord, that is the problem. They will, necessarily, treat the property as an asset. The tenant as a source of income, until they are not needed anymore.

I grew up in local authority housing and it was a godsend. We never had to worry about moving, or being turfed out. As long as my mother paid the rent, adhered to the rental agreement, we stayed. That stress, at least, was removed. So, we grew up, in a stable, clean, , well run and well maintained home. We regarded it as our home and treated it as our home.

It is common, these days, for families to be moved on, several times, in a 5 or 10 year period. I cannot imagine the stress that creates, not to mention the expense.

I think we are both in agreement to some extent. I 100% agree that there should be lots more social housing. One of the main drivers of the problems in the PRS is that people who should never be there in the first place have no place else to go because there is insufficient public housing available. That is due to government policy - the State decided to get out of providing social housing. We need lots more social housing. We also need lots more reasonably priced new houses and apartments for young people to buy. Were that the situation, the PRS will just be used by better off people who don't want to buy a house for whatever reason or it is not practicable for them to do so. That would leave a situation where there is plenty of supply in the PRS so if the landlord is evicting you, some place else of similar quality and rent is available nearby. That is the way it works in Germany and elsewhere in Europe. Very few European countries grant 100% secure tenancies for life. The Netherlands does - but only after a year, so many rental contracts end on the first anniversary and you do have to leave. Longer term contracts are generally only granted to wealthier people moving to the Netherlands to take up jobs in pharma or in finance. The landlord knows they will not be staying in the rented house forever; the stay in Holland is short-term or they will buy there. There are also indications that this system is causing problems in the Netherlands.

Re. shabby, neglected apartments - just take a look on Daft or in the windows of rental agencies. The vast majority of rental properties are of good quality these days.

Yes, some renters do want fixed term contracts these days. If these were in place, then the landlord could not evict for sale or because a family member needed to move in until the end of the fixed term. I actually think that these are a good idea as they will suit some tenants and some landlords. Similar systems do exist elsewhere in Europe (Belgium for example) and it seems to work quite well. The problem here is that the Residential Tenancies Acts impose there own rules on the lease. If you agreed a six year lease with a tenant, the RTA converts it into an indefinite tenancy with eviction on the four grounds only once the fixed term comes to an end. It therefore makes no sense for a landlord to grant a fixed term tenancy, it puts them in a worse position and changes completely what they and the tenant agreed. The legislative system is the problem here, not the landlords. Many landlord would be happy to grant a three, four or five year fixed term tenancy to a tenant they knew was reliable.

 

[Allpartied]

Once again, your understanding of tenancy law is lacking. The only time for 3 months notice is for less than 6 months tenancy. Then the notice increases to152, 180, 196 and 224 days.
I don't think anyone argued that social housing need to increase. However you floated the idea that LL could be in some way expropriated!

I never suggested expropriation, so stop making stuff up.
But making private landlordism the central plank of our housing policy is dysfunctional.

I dislike the phrase " social housing" as it implies that the state should only provide housing to the most distressed citizens, those on the verge of homelessness. In practice, however, huge numbers of working people are being subsidised through the private rental market. The HAP is claimed by the majority of Irish renters, so why not use the funds to provide long term, stable , secure housing for people.