Farm Ireland

Thursday 27 October 2016

In defence of the much-maligned 'landlord'

Joe Barry

Published 13/01/2016 | 02:30

A housing demonstration in Dublin last month. Photo: Stephen Collins.
A housing demonstration in Dublin last month. Photo: Stephen Collins.

It is difficult to turn on the news these days without hearing mention of the housing crisis.

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However, despite what most media commentators and left wing politicians would have us believe, the shortage of housing and the consequent rise in rents are not the fault of landlords.

They are the result of an erosion of homeowners rights, the difficulty of getting rid of bad tenants and ever tighter rental regulations.

The very word "landlord" has an unfortunate historical meaning in Ireland and immediately brings to mind the evictions that took place before, during and after the famine years in the 19th century.

In the interest of fairness, we should use a different term and call landlords accommodation providers or APs.

So who are they, these grasping and anti-social parasites that we are told are preying on the defenseless tenants of Ireland?

APs come from all walks of life and include farmers, shopkeepers, doctors and dentists and even the odd bank official along with hordes who work in the building industry such as carpenters and blocklayers.

There is also a rumour that one AP earns his money, very successfully it would seem, by begging on the streets of Dublin.

Many APs have been lucky enough to inherit a house following the death of a relative and rather than sell it, prefer to hold it and use the rental income to help with the family budget.

There are also those who are so deep in negative equity they feel they must rent rather than sell and suffer a large loss.

Countless pensioners rely on rental income to provide for their retirement years and they just add to the mix of property owners who now find themselves vilified by politicians and the media.

It is of course easy to verbally attack the people who own property.

They are a soft target because, despite the fact that many have large mortgages, they are perceived to be relatively wealthy.

Yet why should they be blamed for having worked hard all their lives, saved money and purchased a house as an investment for passing on to a son or daughter or to help them live when their earning capacity has been

reduced due to ageing? They are taking responsibility for their future, rather than relying on the tax payers of Ireland to care for them in later life.

Many farmers fall in to this category and have either built a second home for their retirement or have purchased one in a nearby town.

Crazy regulations

In the meantime they rent it out like any sensible person might.

They are contributing to society rather than being a burden on the tax payer and should be praised and rewarded for their efforts, currently however, the opposite is the case.

Clearly we need more housing in areas where jobs are available. The private sector is willing and able to provide this if only APs were treated fairly.

Our regulators are heaping crazy regulations on them which only act as a disincentive to invest.

APs in general belong to that group that has prudently saved enough to invest in a house.

They are hoping for a gradual increase in property values to give them capital appreciation plus an income. So what is wrong with that?

I purchased a house and became an AP in the early 1990s and took in tenants for about a decade. I found myself being constantly warned of the pitfalls that lay ahead. Others who also rented out accommodation said I would have nothing but trouble. Fortunately I was lucky or perhaps it was due to strict vetting of prospective tenants.

One man spoke of his experience when he rented a house to students. During the winter, to save money on buying fuel, they cut every second rafter in the attic and burnt them in the fireplace. Guess who was left to pay for the damage.

Others spoke of tenants who stopped paying rent and then couldn't be evicted. Another AP had his house so badly vandalised before he could regain possession it eventually cost him many thousands for repairs.

Such stories are widespread but the media ignores them. All we hear are harrowing tales of single parents and others being cast out on to the streets. Of course there are bad APs, just the same as in any other walk of life.

The majority however, are decent hardworking people trying to get by. It simply proves there are two sides to every story.

Why would anyone invest  in property these days?

Given the manner in which accommodation providers (APs) are being treated, I cannot see why anyone would purchase a house to provide rental accommodation.

APs need enforceable legal protection the same as tenants do. Rents are about to be controlled yet the banks are free to charge heavily mortgaged APs whatever rate of interest they choose.

Even worse, it can take years to regain possession of a house if one is unlucky enough to have a bad tenant. If we are to encourage the building of more houses and apartments then we must provide security and protection for the people who put up the money to buy them in the first place.

The banks are also being criticised for being over cautious when providing mortgages yet when they handed them out liberally in the past, they created a property bubble.

Contrary to what the press tells us, banks are now finding it hugely difficult to repossess property and are naturally reluctant to lend further.

Private investors are similarly slow to buy a house for letting and until this situation is rectified, they will continue to keep their savings in a safer place.

Indo Farming


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