Author Topic: Landlordism 2.0  (Read 3081 times)

thebigfella

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Re: Landlordism 2.0
« Reply #90 on: May 17, 2021, 03:47:03 PM »
There is more to life than just work, hence why people and especially young people like city living.

Decentalising jobs to mulligar sounds great in theory but in reality young people dont want to live there because there is fcuk all to do. Hence why the big tech companies are based in dublin, because they can attract the best talent not just with the job but the lifestyle.

There's not much point earning big bucks in Dublin when you have to spunk most of it on rent/mortgage and the extra cost of living.

Young families not able to afford to rent let alone buy bigger properties to allow them to have kids.. Move the jobs out of Dublin and make it viable for big business to do so and the housing market in Dublin will cool down a good bit but maybe some people don't want that.

This has always been the way with young people living in cities. When you get middle aged your priorities change but in my mid twenties I wanted to be where all the action regardless of what it cost me.


shark

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Re: Landlordism 2.0
« Reply #91 on: May 17, 2021, 03:53:38 PM »
There is more to life than just work, hence why people and especially young people like city living.

Decentalising jobs to mulligar sounds great in theory but in reality young people dont want to live there because there is fcuk all to do. Hence why the big tech companies are based in dublin, because they can attract the best talent not just with the job but the lifestyle.
But if more people were living in Mullingar, there would be more to do!

I spent a long weekend in Athlone last summer, and there was loads to do.

There is a mindset out there though that you need to move to Dublin to be regarded as successful. And the people left behind will be left behind. That wonít change overnight.

But I do think working from home over the last 14 months has been a game changer. IDA have been battling for a number of years to persuade new entrants they donít need to be in Dublin.

Although it will be interesting to hear from people who work in Dublin, but who moved back home during the pandemic. Did it make you miss Dublin more? Or did it make you think quality of life could be better if you lived in your home county?

There is certainly truth in that.
But we are probably more taking about those who are slightly older and thinking about starting a family.
I work in a tech company. The age profile is young, and for sure the 24 year old Sales Development Rep wants to live in an apartment in the city centre. But the 32 year old who has just got engaged, and would like a 4 bedroom house in which to raise a family, might be seeking something different. They probably won't have any problem getting approval for a Ä400k+ property. But Ä400k won't buy much of a 4 bed house in Dublin.
The pandemic has changed things in my world. There is no way I'll be back in the office full time again. It's just not necessary. At the start of the pandemic I lived walking distance from work, as I wouldn't entertain commuting every day. We have moved outside the M50 now, as I know I'll only face that commute at most 3 times a week. More often 1 day, I suspect. I'm seeing this replicated among others in my company. This should help the overall picture a small bit - but I guess every job doesn't have remote capability.

A 400k property would require a combined salary of 100k per annum and a deposit of at least 40k.

Now say that couple are earning 100k a year together and are currently renting their own place in Dublin at 2k a week.

After tax, they might be seeing 70k a year, would that be a fair estimate?

So 24k of their after tax earnings (35%) of what they earn in a year is dead money on rent. Now they have to save up 40k - on their salaries it will probably take about 4 years if they starting from scratch which they likely would be if they are a young couple based in Dublin.

Running a car is expensive, insurance, tax, fuel, services - could be another 3-4k a year, possibly x2 for them. The alternative of public transport to and from work is likely going to be return a similar enough cost.

Utility bills - heating, electricity, bins, broadband, TV. Probably another 4-5k there in a year, possibly more.

Sot that's another 10-15k gone. You're probably now at 40k.

What would groceries be in a year? Would 5k cover a couple for the year?

Now you're at 45k of your 70k wrapped up and that's just on your basic needs.

How many weddings would a young couple have in a year? Anything from 3-4 to 7-8 I'd say. Between stags, hens and weddings probably the guts of 1k each time.

Medical expenses? Health insurance?

Gym memberships, playing sports, holidays, social life, getting a few non-essential items through the year?

Every cent you earn is gone if you want to live an anywhere near decent standard of life if you're stuck in the rental bubble in Dublin.

And that's a couple on decent jobs - just forget it for a single person, don't even go there.

All of the above is very true. And I'm aware that plenty of couples don't earn a combined 100k, or anywhere close to it.
It's not easy to save when paying a lot of rent. I know people who moved back with their parents for 2-3 years in some cases, in order to save a deposit. No fun!
I'm also aware that working in tech , one can forget that they are in a bubble that is not representative if wider society. But still has the ability to distort the market. There are many young(-ish) people in Dublin , working in tech, who have made a lot of money in the past few years on stock options. Even after tax it can come to multiples of annual salary. Especially if one accrued these shares prior to IPO. The 30 Coinbase employees in Dublin got a combined $27m (roughly, at IPO price point) which they will be able to sell (after paying 52% tax) in a few months if they wish. This is an extreme example, but plenty out there getting large 5 figure sums, that are no doubt fuelling property purchases and distorting the market.
« Last Edit: May 17, 2021, 03:55:43 PM by shark »

Angelo

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Re: Landlordism 2.0
« Reply #92 on: May 17, 2021, 04:07:17 PM »
There is more to life than just work, hence why people and especially young people like city living.

Decentalising jobs to mulligar sounds great in theory but in reality young people dont want to live there because there is fcuk all to do. Hence why the big tech companies are based in dublin, because they can attract the best talent not just with the job but the lifestyle.
But if more people were living in Mullingar, there would be more to do!

I spent a long weekend in Athlone last summer, and there was loads to do.

There is a mindset out there though that you need to move to Dublin to be regarded as successful. And the people left behind will be left behind. That wonít change overnight.

But I do think working from home over the last 14 months has been a game changer. IDA have been battling for a number of years to persuade new entrants they donít need to be in Dublin.

Although it will be interesting to hear from people who work in Dublin, but who moved back home during the pandemic. Did it make you miss Dublin more? Or did it make you think quality of life could be better if you lived in your home county?

There is certainly truth in that.
But we are probably more taking about those who are slightly older and thinking about starting a family.
I work in a tech company. The age profile is young, and for sure the 24 year old Sales Development Rep wants to live in an apartment in the city centre. But the 32 year old who has just got engaged, and would like a 4 bedroom house in which to raise a family, might be seeking something different. They probably won't have any problem getting approval for a Ä400k+ property. But Ä400k won't buy much of a 4 bed house in Dublin.
The pandemic has changed things in my world. There is no way I'll be back in the office full time again. It's just not necessary. At the start of the pandemic I lived walking distance from work, as I wouldn't entertain commuting every day. We have moved outside the M50 now, as I know I'll only face that commute at most 3 times a week. More often 1 day, I suspect. I'm seeing this replicated among others in my company. This should help the overall picture a small bit - but I guess every job doesn't have remote capability.

A 400k property would require a combined salary of 100k per annum and a deposit of at least 40k.

Now say that couple are earning 100k a year together and are currently renting their own place in Dublin at 2k a week.

After tax, they might be seeing 70k a year, would that be a fair estimate?

So 24k of their after tax earnings (35%) of what they earn in a year is dead money on rent. Now they have to save up 40k - on their salaries it will probably take about 4 years if they starting from scratch which they likely would be if they are a young couple based in Dublin.

Running a car is expensive, insurance, tax, fuel, services - could be another 3-4k a year, possibly x2 for them. The alternative of public transport to and from work is likely going to be return a similar enough cost.

Utility bills - heating, electricity, bins, broadband, TV. Probably another 4-5k there in a year, possibly more.

Sot that's another 10-15k gone. You're probably now at 40k.

What would groceries be in a year? Would 5k cover a couple for the year?

Now you're at 45k of your 70k wrapped up and that's just on your basic needs.

How many weddings would a young couple have in a year? Anything from 3-4 to 7-8 I'd say. Between stags, hens and weddings probably the guts of 1k each time.

Medical expenses? Health insurance?

Gym memberships, playing sports, holidays, social life, getting a few non-essential items through the year?

Every cent you earn is gone if you want to live an anywhere near decent standard of life if you're stuck in the rental bubble in Dublin.

And that's a couple on decent jobs - just forget it for a single person, don't even go there.

All of the above is very true. And I'm aware that plenty of couples don't earn a combined 100k, or anywhere close to it.
It's not easy to save when paying a lot of rent. I know people who moved back with their parents for 2-3 years in some cases, in order to save a deposit. No fun!
I'm also aware that working in tech , one can forget that they are in a bubble that is not representative if wider society. But still has the ability to distort the market. There are many young(-ish) people in Dublin , working in tech, who have made a lot of money in the past few years on stock options. Even after tax it can come to multiples of annual salary. Especially if one accrued these shares prior to IPO. The 30 Coinbase employees in Dublin got a combined $27m (roughly, at IPO price point) which they will be able to sell (after paying 52% tax) in a few months if they wish. This is an extreme example, but plenty out there getting large 5 figure sums, that are no doubt fuelling property purchases and distorting the market.

And that's the problem isn't it?

People with money are going to invest in property as there is no safer investment at the minute.

The issues is why is govt policy fueling this rather than tackling it? It can't be that hard to draft legislation or increase taxation whereby private investors will not stand to make an absolute fortune through investment in residential property.

I put it up earlier that the mortgage for a 450k home is probably around 1600 pm.
The rental price of a similar property is likely well in excess of 2k.

And that's the issue there - I'd say 70% of couples in Dublin who are currently renting up in Dublin cannot afford to save the deposit up to get a mortgage.
So these investors are coming in and buying property and are then fleecing those people even further with the rental market and gov policy not only enables it but actively encourages it.

Look at the HAP and RAS schemes - look at the annual cost of that to the taxpayer and who benefits - private landlords. FFG policies that consistently damage first time buyers chances but consistently benefit private landlords and vulture funds.



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seafoid

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Re: Landlordism 2.0
« Reply #93 on: May 17, 2021, 07:29:32 PM »
Affordability is a function of income and deposit.

Average earnings last year  were EUR 40,283
6 out of 10 earned less than 36,000

By definition a large chunk of the population do not have the means to buy a house.
This is a political issue.
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RedHand88

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Re: Landlordism 2.0
« Reply #94 on: May 17, 2021, 10:30:39 PM »
There is more to life than just work, hence why people and especially young people like city living.

Decentalising jobs to mulligar sounds great in theory but in reality young people dont want to live there because there is fcuk all to do. Hence why the big tech companies are based in dublin, because they can attract the best talent not just with the job but the lifestyle.
But if more people were living in Mullingar, there would be more to do!

I spent a long weekend in Athlone last summer, and there was loads to do.

There is a mindset out there though that you need to move to Dublin to be regarded as successful. And the people left behind will be left behind. That wonít change overnight.

But I do think working from home over the last 14 months has been a game changer. IDA have been battling for a number of years to persuade new entrants they donít need to be in Dublin.

Although it will be interesting to hear from people who work in Dublin, but who moved back home during the pandemic. Did it make you miss Dublin more? Or did it make you think quality of life could be better if you lived in your home county?

Lived between Belfast and Dublin from 2006 to the present day. Moving back to Tyrone next month and it can't come quick enough! The last 15 months in Belfast, with no garden, have been miserable. The pandemic has really taught me the important things about where you live. That's no disrespect to anyone who has spent their whole lives in an urban environment, but I've just really missed green space and when there are no shops, bars or restaurants, what's the point in living in a city?

RadioGAAGAA

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Re: Landlordism 2.0
« Reply #95 on: May 17, 2021, 11:29:45 PM »
Minister for Housing Darragh OíBrien said on Tuesday that he did not approve of investment funds purchasing almost entire new estates.

ďDo investors have a role here, in housing in Ireland? Yes, they do as they do in most western European countries.Ē

No they f**king don't.

When the price of rent is equivalent to a mortgage, if not more - then they absolutely have no business near domestic property.

If I were in charge, the simple rules would be:
- a house must be owned by an individual.
- no individual can own more than 2 houses (with a 5 exemption year period for inheritance matters).

Simple and to the point.

I'm sure folks will point toward student housing etc - to which I'd respond - so what? There will be enough people willing to invest their "second" house as a student house and rent it to sort that out - without requiring investment companies etc.

I want to agree with you, but the logistics involved in a housing chain (if sale A falls through, then sale B falls too, so sale C canít happen, and sale D has to come off the market) would make your proposal one of extraordinary stress, luck,  and legal intervention.

If you refer to my earlier post about increasing capital gains tax to the point that only rental companies would aspire to own multiple properties, I think it achieves the same goals, but more efficiently

Eh?

I don't see what difference a chain makes to the whole thing.

Chains exist now. They existed in the past and they'll exist in the future.

Having investment vultures snap up houses may make chains shorter - but that is an exceptionally poor reason for supporting their continued existence.
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thewobbler

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Re: Landlordism 2.0
« Reply #96 on: Today at 07:39:05 AM »
The problem is that from the midway point of a chain up, there is a high likelihood that the person involved would have a second investment property. Anyone in that situation, regardless of available capital, is stuck from purchasing until theyíve sold up.

Currently chains break because buyers get cold feet, and because buyers canít raise the capital. But they donít break because a person who really wants a house and can afford it all ends up, is landlocked.