Meanwhile, In Cork

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From top: A letter from Grant Thornton notifying a resident of Blackrock Mews, Eden in Blackrock, Cork of a rent increase last July; a letter dated January 21, notifying the resident that they must leave the property by March 18; and Blackrock Mews, Eden

Journalist Brian O’Connell spoke to Keelin Shanley on Today with Seán O’Rourke this morning about how some residents renting in the Eden residential complex in Blackrock, Cork – which has around 300 units in total – have been told they must leave their property by Friday.

Grant Thornton – which controls 127 units in the Eden complex – told Mr O’Connell that it sent letters to 35 residents in January telling them they needed to vacate their apartment by March 18, 2016.

The letters sent in January followed letters sent last July, notifying the residents of a 25 per cent increase in rent.

Mr O’Connell explained:

The land was formally owned by the Ursuline order, they put the convent and 22 acres up for sale in 2001 and it was bought for €13million. Planning was secured for up to 550 units and they were going to convert the main convent building to apartments. That undeveloped land was then sold on for a reported €30million to Pierce Construction and they were to develop the large-scale Eden residential development. It was launched in 2005. Apartments at the peak were about €330,000 each.

In 2010, Michael McAteer, from Grant Thornton, was appointed as a receiver by IBRC for part of the development and that encompassed 127 units, plus some of the undeveloped land – so about a third of the development came under control of Gran Thornton as a receiver.

It’s a very desirable location, it’s close to Blackrock, also close to the new IT hub in Mahon Point. Rent for a three-bed apartment was in an around €1,000 per month but in recent weeks some tenants have been told that there’s to be a sale of the units and they’ve been given eight weeks to leave their properties.

One tenant, Celso Lemos, a Brazilian father-of-two, has lived in Eden for five years. Mr O’Connell reported that Mr Lemos heard rumours that something was happening after Christmas but he found it hard to get information.

Mr Lemos said:

“They wouldn’t give me information. They would give me bits and pieces here and there but I had to leave because I got a letter, in mid to late January. We were given the statutory eight weeks to leave the property and there wasn’t much negotiation whatsoever…just a crude letter saying, ‘please leave by the 18th of March’.”

Mr Lemos said he’s now trying to convince his wife to move to either Holland or Germany, or move back to Brazil.

In response to questions from Mr O’Connell about the rent increase, a spokesperson from Grant Thornton said:

“Rents during 2015 (the process started April 2015) were realigned to market rental levels and tenants were all provided with adequate notice on same. A number of rental increase cases were lodged by tenants to the Private Residential Tenancies Board (PRTB)  and in each case the rent increase was upheld. The PRTB confirmed all requests for increases were in line with Market Rental levels.”

“In advance of the Receiver issuing notice to tenants, the Receiver waited until the amendment of the Residential Tenancies Act was enacted in December 2015. This act increased the notice periods to be provided to tenants thus ensured the maximum period was provided in cases where vacant possession was sought.”

The spokesperson added:

“Lisney Estate Agents based in Cork has been appointed as the sales agent and any tenants who have shown interest in purchasing their property have been directed to Lisney.”

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Previously: “It’s Just The Beginning”

Pics: Brian O’Connell

96 thoughts on “Meanwhile, In Cork

      1. Owen C

        Wouldn’t the landed class be more likely to retain their position at the top of the food chain by continuing to rent the apartments out, rather than sell them on to actual owner occupiers? I know it doesn’t fit your narrative very well, but have a think about it.

        1. dav

          “Owner Occupier” – unless they pay the full balance in cash for the property they don’t really own it. Instead they are lumbered with a mortgage like a millstone on their necks soon to become “negative equity” as the latest property developer driven bubble bursts. And somehow that same property finds it’s way back in the possession of the landed class again.

          1. Owen C

            This must be the first property developer driven bubble that didn’t involve property being developed.

          2. dav

            landbanks, friend, land banks, houses not being built because they can’t cream as much profit as they use to and instead they blame the central banks prudent deposit measure. If the blushirts, in the last budget, announced measures to tackle the homeless/housing crisis by the state building 50,000 units per year over the next 5, those developers would be building like crazy as their hoarded land lost value.

          3. Condescending Nana

            doesn’t necessarily have to go that way boss, many peeps in pos. equity and with nice close to zero interest rates. It pays to do your homework before putting the money where your mouth is.

          4. Joe Small

            Imagine living next door to “dav”? He’s the kind of guy people he knows cross the road to avoid and the more you know him the less you like him.

        1. MoyestWithExcitement

          Yes, this is planet earth where people can make millions by changing a name on a piece of paper and adversely affecting your life as a direct consequence but also where losers will tell you ‘welcome to planet earth’ if you have an ethical problem with people bring made homeless so that some privileged toff can make those extra millions.

          1. rotide

            1.000 a month for a three bedroom appartment?

            Daaaayumm, that’s cork value right there.

            Years ago I was living in a flat where the owner sold the building but we were able to stay on for the extent of our leases, is that not the case here?

      2. Baz

        Hey Karl,
        It’s 2016, your doctrine has failed and has been rejected in any country where the citizens were given free choice.
        It may be time to generate a new lexicon.

  1. Owen C

    “Selso said he’s now trying to convince his wife to move to either Holland or Germany, or move back to Brazil.”

    So because he has to find a new place to rent, he wants to leave the country? This seems a bit of an overreaction.

    1. Bertie Blenkinsop

      “Selso said he’s now trying to convince his wife to move to either Holland or Germany, or move back to Brazil.”

      I tried that line too but she was insistent that I went with her.

    2. Bruncvik

      If the cost of living compared to the income becomes much less favourable than in another country, I find it sensible to move elsewhere. Had we not secured a reasonably priced property and had we stayed in a rental situation, my wife and I have also been considering the move to Holland or Belgium. This is simple economics: a substitute product (country) offers better value.

      1. TheBeef

        As soon as I saw that this was about something happening in Cork, I waited for the Cork-bashing to begin. And lo and behold, just a few comments down, there it was. Thanks for not disappointing, you guys!

          1. TheBeef

            @Vote Rep #1 – not so much hyper-sensitive, just plain bored of the inevitable and childish insults whenever Cork is mentioned. Inevitable, even on a story such as this which is really about the state of renting in Ireland and isn’t exactly exclusive to Cork.

          1. TheBeef

            @meadowlark – oh I know, it’s not just Cork. I’ve been to Leitrim and thought it was beautiful.

          2. meadowlark

            For the record, I think Cork is stunning. Bear Island (sorry if I spelled it wrong) is amazing.

          3. Bertie Blenkinsop

            Are you from Leitrim Meadowlark?

            * updates “Meadowlark Facts” Excel spreadsheet *

  2. dan

    Here’s how things are for me:
    Self employed, 1 rental property to pay for retirement
    Rent currently €300 a month less than market rates (Family renting apartment for the last 5 years)
    Government fleecing me with tax on rental income, therefore no incentive to keep the rent low.
    If I increase it the tenant won’t be able to afford it (I’ve seen their income figures), but I’ll get a new tenant straight away.
    If I don’t increase the rent I have to subsidise it every week.
    I don’t want to sell and take a big loss.
    I don’t want to be a b***ox and throw this family out
    But I don’t want to keep having to pay a substantial amount of money out every month.

    And here’s a good one.
    I can’t get a 3rd level grant for my children as the gross rental income is considered, even though I don’t get a cent out of it!
    Finally, a little off topic. Landlords are not liable for water charges for the time that a property is rented, I have this in writing from Irish Water.

    1. andydufresne2011

      Dan, you are a decent person.

      “Government fleecing me with tax on rental income, therefore no incentive to keep the rent low.”
      This is obviously one of the problems then.

      The other is the assumption that “Market Rental levels” are set by some untouchable deity or something are are unchangeable. Who sets them really? (that’s not a rhetorical question). Greedy landlords? Greedy Agents? Where is the appetite by the government to tackle this?

      People who come back with “welcome to the real world” show a horrible mix of apathy and a lack of empathy.

    2. DubLoony

      Interesting perspective, thanks for sharing.
      Could you expand on gov taxation charges for landlords?

      I’d heard from someone else that they were being fleeced but I wasn’t sure if the rent was just treated as another income.

      1. Anne

        I’m being fleeced myself with PAYE income tax, USC, PRSI.. we’re all being fleeced.

        He’ll pay either 20% or 41%, depending on the income from the rent, other income, martital status.. things like that.

        Except he can write off a ton of expenses such a portion of the interest on the mortgage (75%), any wear and tear expenses. It’s all available on revenue’s website.

        The mortgage is not considerable a deductible expense.

    3. Anne

      Of course the gross income is considered Dan.

      I presume you have a mortgage on the property, as you say you don’t get a cent out of it..

      Do you think you should be entitled to grants until the mortgage is paid off is it? If you had ten properties, all with mortgages, where the rent just covered the mortgages, if the gross income from the rent was not taxable, at the end of your mortgage, you’d had an asset/s that you got, tax free.

      You say the propose of the property is for retirement, but you indicate that you could make an income from it now.. You would normally have to subsidise a pension btw.. You don’t want to here?

      I’m not telling you how to behave.. But it sounds like a bad investment… I presume when you bought it the rents were lower..

    4. timble

      You aren’t subsiding the mortgage when you end up owning the property when it’s paid off. This is the problem with our landlord class. They want their renters to pick up the entire cost of their asset along with having to pay no tax on the income of the asset.

      A property you own with a mortgage is not a retirement fund. Start up a pension, you get marginal tax relief on your contributions.

      1. JC

        +100 But sure a landlord wouldnt see it that way. Ends up with a fully paid asset which he has partially paid for (if paid for at all)

      2. ahjayzis

        What’s twisted is if the tenant is paying someone else’s mortgage – why can’t they get their own mortgage?

        I don’t want Joe Soap’s running the odd spare property for ‘their pension’ – these things should be done at scale, professional dedicated businesses or cooperatives who own multiple properties and can benefit from economies of scale and render an efficient service to the tenant. Renting should be cheaper than buying.

        One-off buying to let should be an expense for the landlord, else the tenant is buying them a house.

        1. Kieran NYC

          +1

          But then you have people calling any large-scale professional, steady-return based investment in rental properties ‘vulture funds’ and railing against ‘Yanks’ (as it us usually foreign-owned funds that could afford such investments) owning any property, as if it makes a difference.

          It all gets a bit ‘The Field’, writ large.

      3. dan

        1, The subsidy I pay in doesn’t include paying anything off the mortgage.
        2. To offset repairs against tax bill you have to pay for the repairs

        Here’s the figures.

        €800 in rent

        expenditure
        €400 interest on mortgage
        €120 on management fees
        €190 tax paid
        Net income after mortgage interest and management fees: €90
        That does not include repairs, letting fees, property management fees

        Property bought in 2004, 80% mortgage, 25 year term.
        Property now worth 50% of it’s purchase price
        BUT, some day I’ll own it and will have a nice retirement income

        I wasn’t moaning in the earlier post Anne, just telling a story,

        The point is this, no-one is going to build new houses and apartments because there’s no profit in rental and not enough profit in building and selling compared to the risk.

        1. Anne

          190 as a percent of 800 is 23.75%..
          That’s hardly being fleeced.

          You mentioned 400 there in interest payments on the mortgage.. is that after the 75% relief you get on the interest payments or before?
          You also get relief on repairs.. obviously you have to pay for them first as you said.
          Management fees also deductible..
          http://www.revenue.ie/en/tax/it/leaflets/it70.html#section3

          You say there you’re getting 90 euros net income there..
          You mentioned earlier if you don’t increase the rent you have to subsidise it every week… what ‘subsidy’ do you mean?

          I’m not saying you’re moaning dan. Thanks for your story.. but we’re all being fleeced by having to pay tax.

          It seems to me, you want to be left with an asset, that someone else pays for & not only that, you want more of a profit on it along the way.. that you’re being ‘fleeced’ in tax.
          It’s not profitable enough if you’ve to contribute anything, it seems.

          I’m sorry Dan, I’ve no sympathy for you.. why should you be sitting on your nelly making as much money as possible by the virtue of someone else needing a place to live?
          You want to be rewarded more by the very fact of the investment is it?

  3. Rainy Day

    This and the example in Tyrrelstown proves that protection for renters in Ireland is far too weak. Three months is a very short time to leave your home and find a new one, irrespective of how long you have lived in the home ( I hate the term ‘unit’).
    Some people in Tyrrelstown were in their homes for over 8 years, we have very weak laws where it is legal to force these people to leave in a matter of months. These weak laws fed our previous property bubble and will feed the next one as people have no certainty of tenure from renting so the only way to put down roots in a community is to buy.
    To the person above who says “Welcome to Planet earth”, firstly there are countries with much stronger laws protecting tenants, where it is normal to rent as way of obtaining a long term home – e.g. Germany. Secondly renting a home should not be viewed on a par with selling a pint of milk or any other commodity, you are selling a home to people, albeit a temporary home but a home none the less.

    1. DubLoony

      +1
      In Germany, all rental houses are managed by an agency so that the owner is removed from day to day running of it.

  4. Panty Christ

    This must be the cashing out and consolidating phase we are seeing. Cash for capital on new building bubble.

  5. Junkface

    Ireland is full of Vultures, and extortionists. Citizens are ripped off at every milestone of their life, and have no protection. Emmigrate while you can

    1. phil

      Most of the Vultures, and extortionists are irish citizens , might be one sitting beside you , we really do despise each other when living at home, but if people emigrate as you suggested , and as I did one time, you will not find a nicer person than another paddy whilst abroad …

      Not sure why that is, but I suspect the best and most decent of us have emigrated over the many decades , leaving behind the most corrupt and venal of us all…

    1. Same old same old

      Funny – that’s what I thought too :)

      We’re tra-as-ash you and me
      We’re the lovers
      On the street

  6. Tish Mahorey

    It would be interesting to see if there are rent price fixing meetings happening in Ireland, similar to what happened with the concrete industry here. All you need is about 20% of landlords to agree high rents and the rest will follow.

        1. jonotti

          So you need thousands of landlords to gather together at a meeting to try and fix prices of 100% of the market. That’s idiotic.

          1. Tish Mahorey

            The US Vulture Fund landlords alone probably own at least 10% of the apartment market if not a lot more. In tandem with other large institutional owners and the main estate agents, they can easily drive up rents.

            And all of these grubby outfits are also availing of Fine Gael’s capital gains tax exemption (2011-2014) where they will pay NO tax on the sale of property purchased between 2011 and 2014 if they hold it for seven years.

            For decades, the state has failed the citizens in regard to all aspects of home rental and ownership in favour of speculators.

          2. Owen C

            “The US Vulture Fund landlords alone probably own at least 10% of the apartment market if not a lot more.”

            There’s around 1.7mn private households in Ireland.

            Of these, around 500k are rented (475k per 2011 census plus some small estimated increase in the intervening years).

            For 20% of ‘landlords’ to be involved in price fixing, we would need 100,000 homes to fall into this category. For 10% to be owned by “US vulture fund industry” we’d need 50,000 to fall into this category.

            For comparison, the only residential REIT in the country, IRES, owns around 2,000 properties valued at around €470mn. Hibernia REIT owns around 300 residential properties. Green REIT own no residential property. The largest single US investor in property in the Republic of Ireland was Kennedy Wilson. They have total residential assets in Ireland of approximately €77mn, or around 15% of the value of IRES’s asset value. As such, its fair to say that they have less than 1,000 residential units. Now, if you think there are over 50 “US vulture funds” of equivalent size to Kennedy Wilson, you are making some heroic assumptions about the scale of their investment here in Ireland. I would suggest they own less than 10,000 properties, or 2% of the market, maximum. The reality is that most landlords in Ireland are small private citizens owning less than a handful each.

          3. rotide

            Owen C, Silencing the hysterical hyperbole one reasonable fact at a time.

            And having his ‘forced sterlisation’ called for at the same time, from the same person defending twitter abuse no less.

          4. Anne

            Price fixing = see what everyone else is getting, up the price. ‘Morket rates’

            http://www.irishtimes.com/business/commercial-property/cerberus-set-to-buy-6-25bn-nama-loan-portfolio-for-800m-1.2403578

            I’ll just leave that there for ye.

            Cerberus set to buy €6.25bn Nama loan portfolio for €800m.
            Controversial US fund is preferred bidder for Project Arrow portfolio of properties.

            (50 percent, that’d be like I think half of Project Arrow consists of Irish residential property)

            The commercial loans of development lands are being sold to the vultures, as are individual borrowers mortgages.

          5. Owen C

            Anne, lets looks at Project Arrow…

            First of all…its a set of property loans, not properties. Many will no doubt be foreclosed on, but that’s something for the future. At transfer date, Cerberus were not the landlord. Secondly, 43% of these loans are residential. Given that there was only 1,906 properties included in the sale, we’ll assume that 1,000 or so of these are residential. As such, congrats, you have found someone else who may in the future (but not now) be in control of the same amount of properties as Kennedy Wilson. Only 49 more to go…

          6. Anne

            “Anne, lets looks at Project Arrow…
            First of all…its a set of property loans, not properties.”

            Yes, I said loans Owen.. Loans on properties.. We’re not talking loans for Ice-cream vans are we?

            “As such, congrats, you have found someone else who may in the future (but not now) be in control of the same amount of properties as Kennedy Wilson”

            What are you congratulating me for? That information is readily available for everyone..

            And there’s plenty more available..

            http://www.indymedia.ie/article/105489
            “NAMA Has Been a Dream Come True for Many US Vulture Funds…”

            A dream come true Owen.

          7. MoyestWithExcitement

            Well done, Anne. It’s hilarious to watch shrieking ideologues like that fella wet themselves when presented with actual facts.

          8. Owen C

            Amazingly, no one has been able to come even remotely close to substantiating the ideas of 20% of the market colluding on price fixing and 10% of the market being owned by US vulture funds.

            Moyest, have you ever actually posted a fact on this site? I mean, ranting and raving you are top dog at, but facts you seem less proficient in. You don’t even offer interesting opinions, just little one liners here and there. At least Anne gives it a blast with some sort of substance in her response.

          9. MoyestWithExcitement

            You’re right, Owen. I should take this Internet message board as seriously as you do. That what socially adept winners do.

          10. Owen C

            Awesome reply, devoid of any intelligent input, as always. Consistency in a world gone mad.

          11. MoyestWithExcitement

            That’s actually a really good description of all your vacuous, hysterical posts, Owen. I’m impressed for once. I didn’t think you had any self awareness. Clearly I was wrong.

          12. Anne

            “Amazingly, no one has been able to come even remotely close to substantiating the ideas of 20% of the market colluding on price fixing and 10% of the market being owned by US vulture funds.”

            Everyone’s colluding on price fixing, as far as I’m concerned.. it’s what people do. The morket sets the price. More demand than supply, you get your price fixing.

            But cmere Owen, could you substantiate that yourself? That 10% of the market is owned by US vulture funds? You’re talking about residential properties only is it? Not development sites – that houses will have to be built on?
            Any links at all, to say it’s only 10%..

            https://www.broadsheet.ie/2016/03/09/a-test-of-our-progress/

            Did you happen to catch that article there recently on here?

            ‘Their Report shows that housing property (primary residence and second homes) accounts for a quarter of UHNW’s investable wealth, while commercial property investments make up 11%. Thus, total property investment makes up almost 40% of the wealth of the UHNWs while financial investments (equities, bonds, etc) makes up a smaller proportion (28%).

            And the importance of property as an asset has increased in recent years. The reason for the increasing importance of purchasing property was its role as an ‘investment to sell in the future’ and a ‘safe haven for funds’.

            This is in contrast to how most of us see housing as a home rather than an investment asset’

            I thinking you fall into the latter category there.. in relation to seeing housing as an investment for the wealthy.

  7. theCitizen

    First letter doesn’t show any comparables to justify market rent increase. It’s pretty clear cut what comparables must be used and how.

    The legislation around residential tenancy isn’t complicated, amazed people don’t read it.

  8. Tish Mahorey

    The tradition of the Gombeen man goes back to when small farmers were forced off their farms by rack-renter absentee landlords and the local men auctioned off their possessions to pay back rent, etc. These opportunistic Irish men were happy to do the bidding of landed gentry Lords in Britain and impoverish their fellow countrymen. And many of their descendants went into politics and continue in that tradition today.

    Nothing has changed.

    Nothing.

    1. Jake38

      @TishMahorey. That was almost perfect. You got “US”, “Vulture Funds”, “Fine Gael”, “Gombeen”, and “Lords”. You forgot Israel and the Corrib Gas field. Do you want to try again for honours?

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