Tag Archives: Rental Sector


In The Irish Times.

Colin Gleeson writes about the rental sector and residential landlords.

He writes:

Pat (66) has been a residential landlord all his life, but he’d prefer if his full name wasn’t published by The Irish Times. “Do you know the opprobrium I would get if I was identified?” he asks. “The hate mail I would get?”

After falling into the sector “by accident”, Pat at one stage had about 80 tenants on his books in 20 properties around Dublin 6 and Dublin 1. “I wouldn’t house one now,” he says. “Not one.”

This, he argues, is due to “appalling treatment” by the Government, and what he calls the “Tesco-isation” of the sector.

“What I mean by that is, the small guy who was providing accommodation was put out of business while the bigger players came in.

“These big American companies are coming in and they have no problem with compliance and all the registration and so forth. It’s easy for them because they have the scale, but, for the small guy, it’s murderous.

“Pretty soon, the only people letting properties will be the big huge companies. When tenants have a problem, they’ll ring up a number to say the toilet’s blocked, and they’ll get an answering machine somewhere in the United States.”

…The story of the housing and rental crisis has largely been told through the prism of the house buyer and the tenant, but Pat can barely contain his anger at what he perceives to be a stacked deck, and vitriol towards landlords among the public.

‘Tesco-isation’ of home rental sector driving landlords out (Colin Gleeson, The Irish Times)

Mark Stedman/Rollingnews


Michelle Moran and Roughan MacNamara of Focus Ireland launching the charity’s campaign calling for legislation to fully protect Irish homes from vulture funds in August

First-Time Buyer writes:

Effective lobbying is done as quietly as possible behind the scenes, ensuring that you get the result you were looking for without anyone else being the wiser…

Back in September, Minister for Finance Michael Noonan proposed a number of changes to Section 110 of the Taxes Consolidation Act 1997 which contains the provisions for Ireland’s securitisation regime.

This was on the back of various concerns raised in the media that “investors” (foreign funds) were using the legislation to avoid paying tax on Irish property by using S110 Special Purpose Vehicles (“SPVs”) for their transactions.

The Irish securitisation regime is very generous in that it permits certain companies to deduct interest payments on profit participating debt (i.e. loans where the interest rate is directly linked to the underlying profits of the SPV rather than a set rate).

In effect, this means that these SPVS could wipe out all of their profits with interest deductions leaving only a very small taxable margin (usually €1,000). These SPVs were making tens of millions from Irish property, but effectively were only paying as little as €250 to Revenue.

The aim of the amendments to the regime were to ringfence profits arising from a property business and ensure that a deduction was not available for profit participating interest.

This would protect the Irish tax base by ensuring these SPVs would pay tax at 25% on all of its Irish property profits, rather than only on the token €1,000.

A property business was originally defined as one which is involved in the holding or managing of “any financial asset which derives its value, or the greater part of its value directly or indirectly, from land in the State”.

When interpreted this would include property loans and mortgages but also shares in a company which derive its value from Irish property (e.g a Limited company that holds property, also known as a “Propco”).

What nobody noticed though was that in the time between the publishing of the original legislation in September to the publication of the Finance Bill in October a very deliberate change was made to narrow the definition of ‘specified mortgage’.

Such a narrowing means this anti-avoidance legislation is now only confined to loans and specified agreements deriving their value from Irish land but not to shares in a Propco (more on why below).

At the same time of this deliberate change, the Government included another, seemingly unrelated, measure to restore 100% interest deductibility for landlords of residential properties. This generous tax break encourages Propcos to be highly geared, to ensure their rental profits are significantly reduced by interest deductions.

When you combine these two measures it means the ‘investors’ will warehouse their Irish properties into simple Propcos, rather than the complicated SPVs, QIAIFs or ICAVs that we’ve been reading about in the media.

The investors will own the Propcos, via their existing S110 SPVs. They will fully leverage the Propco with related party debt, maximising the new 100% interest deductibility rules. This will ensure that any income arising will be fully sheltered by tax deductions, thus a continuing ability to avoid tax on the Irish rental profit.

In addition, the investor can avoid capital gains on a disposal of the property by simply selling the shares in the Propco rather than selling the property asset directly.

The gain on the sale of the shares of the Propco will arise to the S110 SPV and because the definition of ‘specified mortgage’ does not include the sale of shares, the SPV can use profit participating interest to wipe out its gain on the sale.

You couldn’t make this up.

Related: Vulture funds hit by political cave-in on tax reprieve (The Irish Times, November 22, 2016)

Previously: Mars Capital, Matheson And The €250 Tax Bill

Sasko Lazarov/Rollingnews


Private tenants in Ireland pay the second highest monthly rent in Europe.

The European average is €481.

Meanwhile private rented households in Ireland spend almost 34% of their income on paying their rent, compared to a European average of 28%.


Private renters in UK pay double the European average (Gerard Koessi, National Housing Federation)

Thanks Donough Ryan


Today’s Irish Independent front page

New figures from the Private Residential Tenancies Board (PRTB) show 455,000 lived in private rented housing in December 2013. This has risen to 695,646 today, meaning the number has increased by 240,000 or 52pc in just 18 months.

Housing Crisis Forces 10,000 A Month To Rent (irish Independent)



C writes:

I got onto PRTB and they said the figures quoted in 2013 reflects the number of “tenants” listed on a registration application form. However, this “tenants figure” generally represents only the named parties in a tenancy agreement with contractual responsibility for that tenancy and does not reflect the actual number of people living in the private rental sector, e.g. it  generally would not include minors under the age of 18.
During 2014, the PRTB introduced a new statistic based on the number of “occupants” listed on the registration application form (see above).  The PRTB believe the “Occupants” figure gives a truer picture of the numbers residing in the private rental sector. Do you see what the newspaper did so?




Further to yesterday’s report from the Dublin rental front line.

Roisin writes:

“We just moved into a rented property in D18 after searching for 4 weeks. The house was on the market at the top end of our budget, but was close to work/school etc and had obviously been well looked after. Like the person in your post, other people also registered an interest in the property.
We were contacted by the estate agent later that day to say that another couple had offered 50 euro per month more, and would we consider putting in a higher offer, so we did. And then she came back 20 mins later to say they had offered higher again. At which point we questioned the fact that no references had even been submitted at this stage and she know if the other couple would even be accepted by the owners? Later that day we had a call to say that we had been accepted at the ORIGINALLY ADVERTISED MONTHLY RENT.
When I met the owner after moving in, he said he was astounded by the unethical practices of the estate agent, and he was more than happy with the rent amount as originally agreed.
Sometimes the landlords are not the ones to blame. The estate agents are making it their business to instil panic in the market, as they are the ones who will benefit most from it.”


Previously: Poor Rental Guidance