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How Much Do Landlords Make? Revenue Has The Numbers And Has Spilled The Beans

October 12, 2018 By Lee

Landlords are generally regarded as an essential evil in their own market place, with such high rents in the market these days, they are seen as making obscene profits. But how true is that?

Up till now  there were no hard figures for us to work on, but this week the Irish Times published figures from Revenue.ie. Revenue now ask landlords for the source of their income and how many units the let out. So we can now see the average return a landlord makes on her investment.
Averages hide a multitude of course and your percentage return differs hugely depending on what you bought at, but as a ‘global average’, it’s a useful number.
I’m sticking to residential landlords here in Ireland and I’m not including the Corporate Landlords (REITS etc) or foreign property.

In 2016 145,000 landlords took in €2.6b in gross income and offset expenses(*) of €1b, leaving a nett income of €1.6b. That leaves an average income of €18,000 per year and an average expenses offset of €7400. So the average taxable income was €10,600.

At the 20% tax rate plus PSRI and USC, her take home income was €7750, or at the 40% rate it would be €5620.

Assuming the average house price countrywide of €250,000 that would give her a take home return of-
3.1% on the 20% rate – or 3.9% if she bought at €200,000 – and a
2.2% return – or 2.8% if she bought at €200,000 –  on the 40% rate

Not exactly an ‘obscene profit’ by any stretch. Now of course she will also have the benefit (in today’s market) of an increasing capital value of her asset, though she will pay Capital Gains Tax on that too.

(*) Insurance, maintenance, repairs, PRTB fees, interest….

See the IT article here – https://www.irishtimes.com/business/personal-finance/landlords-paid-tax-on-59-of-rental-income-in-2016-1.3658963

Caden Grimes Estates is a Licenced Property Services Provider, Licence 001883.
www.CadenGrimesEstates.ie   info@CGestates.ie      01 9014480

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    "We first engaged Gerry Grimes to find a tenant for us in 2005 and have been using his services ever since. We don't even consider contacting another agency when we are looking for new tenants. Gerry's judgement has always been sound, the end result being that our property has been let without major gaps in tenancy and the clients were long lasting and reliable."

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    "PropertyforPeople has managed our property for the past four years. He consistently conducted his business expertly, efficiently and with minimum intrusion to us. He secured several excellent tenants who left the property in impeccable condition. Based on the high quality of service that we have received from Gerry, we would gladly recommend his services to anyone seeking a reliable property manager."

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