Tag Archives: Rents

Mountie/Ninja Fight!

Ires Reit?


one-bedroom apartment in the Capital Dock residence, Grand Canal, Dublin 2

Dublin skyline.

Manhattan prices.

FIGHT!

Capital Docks (Daft)

The starting bid on the family home in Rathmines was €685,000, It sold for €1.25 million

Meanwhile….

Social Democrats Housing Spokesperson Cian O’Callaghan said:

“Paying €1.25m, when the annual rent roll for that property will be nearly €50,000, means the investor makes a healthy return. They will secure a yield of nearly 4pc a year on their investment – which is a much better return than can be found almost anywhere else in the world at the moment.

“It is also a much safer bet than most investments – because the State guarantees this rent roll for 25 years. Instead of building its own social and affordable housing, the Government is reliant on the private market to supply homes. It is doing long-leasing deals with private developers and investment funds, which is the reason they are snapping up any meagre housing supply that comes on the market.

Four houses going for way over their asking price in bidding frenzy (Extra.ie)

Pic: Ed Dempsey and Assoc.

Meanwhile…

This afternoon.

The Dáil at the Convention Centre.

Taoiseach Micheal Martin said that the Minister for Housing Darragh O’Brien will “bring in legislation quickly” to close a loophole allowing an 8% rent hike for tenants.

However, he said that the Government is limited by the Constitution on introducing a blanket ban on rent increases.

Sinn Féin leader Mary Lou McDonald said that “an entire generation is locked out of home ownership” because of high rents.

Not only do they face the prospect of the Government “cutting their income support”, she added, but they also face a “double whammy” of an 8% rent hike.

Loophole allowing 8% rent hike to be closed – Taoiseach (RTE)

RollingNews

This afternoon.

Good times.

Earlier: Bulk Smash

Taoiseach defends new cuckoo fund rules as Mary Lou McDonald dismisses them as a ‘cop-out’ (Independent.ie)

RollingNews

From top: Social Democrats co-leader Catherine Murphy; Gillen Markets

This afternoon.

During Leader’s Questions, Social Democrats co-leader Catherine Murphy quoted to Taoiseach Micheal Martin directly from a note sent by Dublin-based financial advisory firm, Gillen Markets, to their investors.

She told the Dail:

“It said, and I quote: ‘The current high level of house prices and rents in Ireland’s residential property market have been driven in a significant way by the Government’s housing policy with favourable policies attracting institutional investors, such as Ires Reit, into the market.

“‘Their gradual move into the market has contributed to higher housing prices and, thus, higher rents.’”

“It continues: ‘Overall, the current housing policy has benefited both institutions and developers at the expense of individual buyers.

“‘The potential risk for institutions such as Ires comes from a potential change in Government policy.’”

Ms Murphy added:

“Now, Taoiseach, Gillen Markets’ assessment of your Government’s housing policy is among the most damning I’ve ever read, even if it wasn’t intended to be. And, your Government knew all about it.”

In June last, The Times Ireland Edition, published a lengthy article about it and, like any good journalists, they called the Department of Housing to get their reaction. So, Taoiseach, don’t say you weren’t warned – the warning came from the vulture’s mouth.

When firms like Gillen Markets give cuckoo funds warnings about risk, what they tell them is their biggest threat in this country is a wholesale change in government policy to an interventionist approach that boosts affordability.

…The key reason the Government decided to act was that you know the game is up. Mullen Park was only the catalyst – you know this will not be tolerated by those trapped in this situation any longer…

Taoiseach accused of ‘sitting on his hands’ as rents spiral out of control (Belfast Telegraph)

RollingNews

From top: Housing Minister Eoghan Murphy this morning with. Dublin Simon Community CEO Sam McGuinness during the launch of Simon Community Annual Review; Anne Marie McNally

Today the Minister for Housing described the level of rent increases in Ireland as ‘unsustainable’. Yet in doing so he offered nothing to actually address the issue.

Unsustainable to him is a word in a press release. Unsustainable, to a family in rented accommodation means potential homelessness.

Yesterday’s ESRI report should be the impetus needed for this Government to call an urgent halt to the dangerous way in which the rental sector in Ireland is developing.

It is surely time for recognition that an immediate nationwide rent freeze is required and it must seriously begin the debate regarding whether or not the Central Bank mortgage rules are having the unintended consequence of driving the rental sector further and further out of control.

The Central Bank mortgage rules were implemented in order to stop people taking on mortgages they could not afford.

But as a result of spiraling house prices, the deposit amounts required get further and further from ordinary worker’s reach and therefore so too does home ownership, this despite the ability of many to comfortably sustain a mortgage repayment.

Instead people have been forced to turn to the private rented sector where they find little to no security of tenure and escalating rental costs which are more often than not significantly higher than the mortgage payment they would have to make if they could just get a deposit together.

Recent data from Daft.ie shows that most mortgages needed to buy one, two or three bedroom properties cost substantially less per month than average rents for similar properties. In some cases, a mortgage is half the cost of the rent.

Similar data was published by Cairn Homes showing that it’s 50% more expensive to rent a property in one of its developments than it is to buy – a situation which cause the Cairns CEO to comment:

“That’s an extraordinary number that people don’t seem to fully understand.”

In ‘helping’ people to avoid mortgages they cannot afford, the Central Bank rules have forced increasing numbers of people to take on rents they cannot afford.

This creates a precariousness in people’s personal lives but also in our wider economy and society which is, to borrow Minister Murphy’s word of the day, unsustainable.

Nobody is winning here – except maybe, in the short-term at least, some landlords.

The ESRI report says the average rent in Dublin is now around €1,700 – a quick check on Daft.ie shows that is very much on the lower end of the properties available.

If you’re a single income household earning in or around the average wage of €38,871 (CSO.ie) per year and renting in Dublin, then a significant percentage (52.5%) of your earnings are being spent just to keep a roof over your head.

(Many households find themselves with little choice but to be single-income because the cost of childcare often makes it impossible for both parents to work full-time).

How, in reality, can anyone be expected to fork out almost €2,000 per month a rent, pay bills, buy food etc., and at the same time save towards a deposit for a mortgage?

While the catchphrase about rent being dead money is common, so too is the more apt one in this situation: ‘you can’t get blood from a stone’.

So we find ourselves in what is essentially a vicious cycle of renters paying ever increasing rents whilst getting pushed further and further away from the prospect of home ownership.

All the while they continue to age and if they do somehow manage to save, by the time they’ve got the deposit together their age becomes an issue for potential mortgage lenders and impacts on the amount they can borrow.

The effect of trapping long-term renters in high rents is that the mortgage rules are actually inflating the rental market AND driving up housing costs for everyone.

While most of the Central Bank rules are very welcome and help prevent people from over-borrowing and taking on mortgages they can’t afford, it does not take account of the significant difficulties facing those forced to rent at all-time high rates.

While at the same time trying to save for a forever-home where according to the Banking and Payments Federation of Ireland, the average first-time buyer’s deposit in Dublin is around the €55,000 mark.

There are already a number of exemptions and lee-ways built into the Central Bank rules for other groups including those in negative equity and for buy-to lets.

The Social Democrats very much support the Central Bank rules but with an addition of common sense when it comes to adapting to changing economic circumstances. We know the Central Bank has not to date been a very customer focused organisation but it is time for that to change.

The very real danger in continuing to ignore the effect these rules are having on the overall economy is that house prices AND rents will rise as the rules will continue to make it more lucrative to put a property up for rent than to sell it.

We can already see this happening with REITs and Cuckoo funds pre-buying units thereby denying first-time buyers the chance to even bid on traditional ‘starter’ homes.

If a renter can prove, over a sustained period that they are capable of meeting high rental payments, are not over-stretching themselves, and are moving to a much more sustainable and affordable arrangement; that should be factored into how much of a mortgage can be accessed by way of reduced up-front deposit requirements.

That’s not risky, that’s just sound economic sense.

Anne Marie McNally is Political Director of the Social Democrats

Rollingnews

This afternoon.

Richmond Street South, Dublin 2.

Via Shaw & Shoddytonic Crew

We’ve tried really hard over the last few months to renew the lease, stay on longer, or buy the place. A lot of things didn’t go our way over the last 12 months either, but it’s out of our hands now unfortunately.

…Dublin is changing, we can all see and feel it but we are going nowhere & we won’t go down without a fight. We’ll start something else, somewhere else [ plans are afoot ] , and keep fighting the good fight.

There are so many young creative, clever, smart people in Dublin & Ireland at the moment – there’s lots to be optimistic about – but they need the spaces to meet each other, make plans, and make them happen!

We’ll have more info, lineups, events, wakes, next steps out over the next few days & weeks…. until the end of October we’re open as normal, we’re ready for y’all and we’re gonna party like its….2019!

It is with heavy heart… (Bernard Shaw)

The Bernard Shaw and Eatyard Are To Close On October 31 (Golden Plec)

Meanwhile…

Meanwhile…

.

Thud.

Last night.

The Tonight Show on VMT.

Good times.