The demand for rental accommodation in capital cities all across Europe is proving to be a reliable source of income for investors but especially for Approved Retirement Funds in Ireland who rely more than most investors on earning a regular income to keep their pension pot from dwindling down each year. ARF pension holders in Ireland are largely aware of the benefits of receiving rental income into their pension every month but many feel the option of purchasing rental property directly into their pension is either too complicated or too time consuming and are choosing to go down the more passive route to achieve their goal of earning regular monthly rental income.
So, why is there such a strong rental demand in Dublin City and how are Approved Retirement Funds (ARFs) benefiting from this?
Economic Opportunities: Dublin is the economic hub of Ireland, home to numerous multinational corporations, tech companies, and financial institutions so it is considered a very attractive place to live and work. It offers a wide range of job opportunities, attracting both domestic and international workers. This influx of professionals drives the demand for rental housing.
Education: Dublin boasts several prestigious universities and colleges, such as Trinity College Dublin and University College Dublin. The presence of these institutions attracts students from across the country and around the world, creating a consistent demand for student accommodation.
Cultural and Social Amenities: Dublin is known for its rich cultural scene, historical sites, vibrant nightlife, and recreational amenities. This cultural vibrancy makes it an attractive place to live for people of all ages, further fuelling rental demand.
Limited Housing Supply: Dublin has faced challenges in keeping up with its housing supply to meet the growing demand. This supply-demand imbalance contributes to higher rental rates and makes it an appealing market for property investors.
Population Growth: Dublin's population has been steadily increasing, driven by both natural growth and immigration. This population growth places pressure on the housing market, increasing the demand for rental properties.
ARF Pensions are benefitting in two main ways:
Steady Income: Investors can enjoy a consistent stream of rental income due to the high demand for housing. Well-located properties in Dublin often command competitive rental rates.
Diversification: Investing into the Dublin real estate market can provide diversification within an investment portfolio, as it is an asset class that may perform differently than stocks or bonds.
However, it's crucial to conduct thorough research, due diligence, and financial planning before investing in Dublin City's real estate market. Consider factors like location, property type, financing options, and legal regulations. Additionally, stay informed about market trends and economic conditions that can impact the rental market. Consulting with local real estate experts and financial advisors can provide valuable insights and guidance for successful property investments in Dublin City.
Direct or Passive - What is the best option for an ARF?
The choice between a direct property investment strategy and passive property investments depends on your financial goals, risk tolerance, available time, and expertise. Both approaches have their advantages and disadvantages:
Direct Property Investment Strategy:
Advantages:
- Control: With direct property investment, you have direct control over property selection, management, and decision-making.
- Potential for Higher Returns: Direct ownership allows you to potentially earn higher returns, especially if you can add value to the property through renovations or improvements.
Disadvantages:
- Active Involvement: Direct property investment requires active management, including property maintenance, dealing with tenants, and handling any issues that arise.
- Lack of Diversification: Investing in a single property or a small portfolio can lack diversification, which can increase risk.
- Time and Effort: Managing real estate can be time-consuming and may not be suitable for individuals with busy schedules.
Passive Property Investments:
Advantages:
- Diversification: Passive investments like Real Estate Investment Trusts (REITs) or real estate crowdfunding allow you to invest in a diversified portfolio of properties, reducing risk.
- Professional Management: Passive investments are managed by professionals, which can save you time and reduce the burden of property management.
Disadvantages:
- Limited Control: You have limited control over property selection and management decisions because they are made by the fund managers or platform operators.
- Lower Potential Returns: Passive investments may offer lower returns compared to direct ownership, as you won't benefit from property appreciation and improvements directly.
- Fees: Some passive investments may charge management fees or other expenses that can eat into your returns.
Ultimately, the choice between direct and passive property investments depends on your personal preferences and financial situation. If you have the time, expertise, and willingness to actively manage properties, direct ownership may be suitable for you. However, it requires a more hands-on approach.
On the other hand, if you prefer a more hands-off approach, want diversification, and value liquidity, passive property investments like RentFlow can be a good option. They allow you to participate in real estate markets without the responsibilities of property management.
RentFlow – passive monthly income for ARF investors
Investors earn 65% of the Net Operating Income from our property portfolio transferred to their bank account every month – equivalent to 5.2% per annum and growing.
Tax free income: Rental income is a good source of stable retirement income and RentFlow ARF investors receive their income every month into their account tax free. Over €10 millions of pension and retirement savings invested in previous 12 months
5.2% per annum and growing: Investors are assured by contract to earn a minimum 5%p.a. Investors are currently earning 5.2% p.a. with the returns growing in line with rental inflation achieved in the portfolio each year. We are on target to add over 27% more to retirement savings pots over the next 5 years.
Investors paid monthly: Pensions remain more liquid with monthly income payments from RentFlow. This gives pension holder piece of mind that there is new liquidity coming into their pension fund every month to withdrawals and any pension trustee fees. RentFlow has a 100% track record in fixed monthly income payments to its investors. RentFlow investors have earned over EUR650,000 since February 2022, with monthly income payments being made to them on the 15th of each month.
Mortgage Free low risk investment: RentFlow ARF investors don't have to worry about mortgage payments or the risk of defaulting on a loan. We have completely removed all Bank Finance from our investments. This reduces the potential for foreclosure and the associated financial implications. Since RentFlow does not use any bank finance it means we don’t have mortgage payments to make, so more monthly cash flow is available to pay investors each month. When you don't have a mortgage, you're not affected by fluctuations in interest rates. Rising interest rates can impact the profitability of a property investment. Without a lender involved, you have more control over decisions related to the property investment.
No Fees or charges: RentFlow has no once-off or annual charges to investors. 100% of the funds are invested and 100% of the funds are repaid on exit.
Independent Security Trustee: Irish owned and managed property investment company, RentFlow appoints an independent security trustee (City Trust) putting investors first.
LK Shields (a top 10 Irish Legal Firm) has drawn up all the security documentation and contracts.
Pension approved: RentFlow has been approved for self-directed PRBs, PRSAs & ARFs with Newcourt & ITC pension trustees amongst others.
Residential portfolio: RentFlow has a portfolio of fully tenanted apartments in Dublin city centre. Strong potential for rental income growth will see investor returns increase each year in line with the annual rental inflation achieved in the ‘Series 2’ portfolio.
Profile of our property portfolio
Also known as Multi-Family Homes, typically Georgian style buildings
Prime city centre locations for long term rental
Tenants are professional singles and couples working in the city centre
Portfolio consists mainly of studios & 1-bedroom apartments with a small number of 2- & 3-bedroom units
Average rent per unit - €1,303 per month across the portfolio
Average number of tenants per unit - 1.7, with an average rent per tenant - €766 per month
Occupancy rate in previous 12 months – 99.5%
All tenants are RTB registered and are professionally managed by PSRA regulated property managers
Fully compliant with planning, building and fire regulations
All buildings exceed the RTB guide to the minimum standards for rented properties as set out in Housing (Standards For Rented Houses) Regulations 2019
RentFlow is one of the fastest growing investment companies in Ireland’s living sector. We are turning monthly rental income into retirement savings for investors. Tax-free monthly rental income is being paid to Irish private pension funds every month using RentFlow. By completely removing all bank finance, RentFlow is providing investors with attractive returns secured directly against property assets.
Ready to start earning?
Call, email or come in for a personal consultation, we’d love to meet you.
T: +353 (0) 1 961 9413
E: info@rentflow.ie
A: The Masonry Building, 151-156 Thomas St., Dublin 8, Ireland