It's time to stop punishing small-time landlords
06 March, 2017
When it comes to landlords the most common assumption is that if he/she is a small-time landlord, he/she will not do a good job of managing a property. The Residential Tenancies Board (RTB) doesn't provide statistics on landlord size. So we can only assume that those dealing with fewer tenants are usually more culpable, although recent headlines about some landlords - with upwards of 60 people in a single house - might suggest that bad landlords come in all shapes & sizes.
Currently there are 325,000 tenancies refistered representing 175,000 landlords and upwards of 700,000 registered occupants. No matter the industry, this will mean there are some disputes. The most recent data I could find was the RTB's annual report from 2014. In it less than 1% of tenancies (6,071) result in formal complaints. Of these, 3,374 went to mediation and only 447 were appealed to tribunal. The single biggest issue was rent arrears and over-holding, which was 34% of cases. These are both typically issues on the tenant side.
The second biggest issue was landlord oriented and involved invalid notices of termination, at 25% of complaints. That there is so much non-compliance is still a problem. There were almost 20,000 notices sent out to remind landlords of their requirements but this bled down to just 21 District Court proceedings.
The third issue is that of deposit retention and it accounted forfor 23% of cases. In 29% of those, the deposit was partially refunded, in 33% it was validly retained and in 38% of the the cases the deposit was fully refunded. So 62% of cases do not result in a landlord being entirely in the wrong....
Landlords need to get parity of treatment in taxation. This has been avoided since 2009. Recently the findings in the High Court that the Non-Principal-Private-Residence charge was tax deductible may lead to a case of the Local Property Tax being the same, which would be a positive development. Bring able to off set full mortgage interest is also vital. This unfair treatment must end. You can't demand professionalism while treating the sector to a slap-stick taxation environment, these are incompatible objectives.
The RTB has done such a good job of raising its prices that perhaps it could incorporate some landlord CPD hours (even if done online) for landlords in return for lower registration fees. The more educated landlords are on processes, the less likelythey are to withhold deposits unfairly or break rules.
There is also scope for preferential tax treatment in return for rent control. Why one one hand do we punish a sector with rent control but then keep the rest of the broken system? Is quid pro quo becoming a forgotten concept in our housing mess?
The majority of landlords are, and will be for some time, small-time, accidential or reluctant landlords. Landlords are soft targets. It's time the role of 'mom n pop' landlords is not seen as a barrier to progress but as a key stakeholder in a wider housing environment and accepted as stakeholders worthy of tax treatment as fair as their direct competitors get.