Housing Bubble Bursting

Caoimhín

doggy Bear wrote: »

Yes, the IMF is well-known for not giving a f*ck about what it does internally to a country's economy.

I should have emphasised the cynicism in that statement but I didnt want to patronise you by underestimating your intellectual capacity to see it.
I'll use the :rolleyes: in future to help the poor sould who, unlike you and I, cant spot the obvious.

(call me a vulture if you will)

I would never call anyone that, if i did, it would actually be a compliment given the circumstance.
Listen, fair play to you, if you have done your homework and you have covered yourself for any future fiscal upset. You said that you are buying property to make a home rather than trying to make a quick buck then I admire your resolve.

All I would say to you, and its only my own humble opinion, is to treat what will be the biggest financial decision in your life like a scientific hypotheses. That is, assume that the figures and assumptions about the economy and property market are wrong.

Throw all and every argument against your theory and if it still holds up, despite the counter-arguments, then at least you can tell yourself in ten years time that you thought it through using all the available information and facts you could find (as opposed to what an estate agent told you or extrapolating a graph that you found on the internet).

Sorry to be so long winded, but just get your figures right and use your head rather than buying out of emotion.

Speaking of gombean landlords, I could have (and should have) punched him in the face then and there. Long may those feckers suffer now...

Agreed, i honestly hope these slum lords wind up facing bankruptcy proceedings in the commercial court.

tanyabond

doggy Bear wrote: »

Fine Gael want to abolish the first-time buyers mortgage allowance by June of this year.

What is a first-time buyers mortgage allowance?

K-9

tanyabond wrote: »

What is a first-time buyers mortgage allowance?

Mortgage Interest Relief I think.

FG have plans to increase it for people who bought since 03. Might as well let the taxpayer seeing as they are paying for everything else!

doggy Bear

K-9 wrote: »

Mortgage Interest Relief I think.

FG have plans to increase it for people who bought since 03. Might as well let the taxpayer seeing as they are paying for everything else!

You're right. Sorry. Mortgage interest relief is actually what I meant, for first time buyers, is to be abolished from June this year.
Strange dualities with FG. That government will be interesting to watch, if not amusing. Grab the popcorn.

bmarley

Caoimhín wrote: »

My point is the government is subsidising the property investment portfolios of middle class investors, speculators and gombeen landlords through the HSE rent allowance.

Naturally this is also keeping rent artificially high. For example, im renting in Leitrim, the ground zero of the property crash and full of vacant houses. However, because of the HSE rent allowance, rent is kept at the €500 per month range because of the rent supplement.

If left to the free market, both rent and house purchase price would find its natural lever. But that is one thing the political classes will never allow to happen.

Maybe the IMF will sort this issue out.

I do see your point here and would agree with you on this. I am very familiar with Leitrim area where there are whole estates of empty housing. Yet there are people living in which I can only describe as squalor (social housing) in some areas. Surely this does not make sense. There are other families (I am aware of) who have been receiving rent supplements for the past 10plus years because there was no social housing available to match their needs at the time when they applied for social housing. Of course, they prefer to live in their chosen accommodation into of on social housing estate.

bmarley

K-9 wrote: »

Mortgage Interest Relief I think.

FG have plans to increase it for people who bought since 03. Might as well let the taxpayer seeing as they are paying for everything else!

Hope they do...increase it, that is:)

tanyabond

This interest relief, is it the amount off-set against personal tax?
Also should the FG discontinue it in June wouldn't that mean that you'll be able to use it just for March, April and May? Or would the mortgages prior to June keep qualifying for it?

Treehouse72

doggy Bear wrote: »

Questions are circling around my head, such as:

Are prices going to continue to fall?
Without any doubt whatsoever.

Am I buying too early?
Yes.

Is the economy going to improve as to provide me with more job security?
No. We won't even reach the economic bottom for several more years, never mind seeing recovery or growth. I'd be surprised if we see real improvement in unemployment, balanced budgets, lower emigration etc. inside 10 years. Best case scenario is bottoming out in 2 or 3 years followed by several years of flatlining. Then, maybe, some kind of recovery. That's the guts of a decade.

Right now, my monthly repayments will be less than rent due to low interest rates. How long will that last for?
Not long. Rates are rising by the day domestically, even before the ECB moves, which it has indicated it will as soon as next month and as often as 4 times in the next year.

My opinions on your questions. I may be wrong, but I'd bet every penny I have in the world that I'm not.

Treehouse72

Treehouse72 wrote: »

My opinions on your questions. I may be wrong, but I'd bet every penny I have in the world that I'm not.

+1
And to add, with the current global financial situation & peak oil, it will never actually bottom out! what will happen is that prices in certain "high costs" areas, i.e. those far away from jobs, shops etc will continue to fall, while those in urban areas will eventually start to rise in relative value, but that rise may be still below inflation.

K-9

tanyabond wrote: »

This interest relief, is it the amount off-set against personal tax?
Also should the FG discontinue it in June wouldn't that mean that you'll be able to use it just for March, April and May? Or would the mortgages prior to June keep qualifying for it?

It can be taken of the payment, you don't have to pay tax to get it!

kitty25

I am thinking about buying a house or build a house. Do you know if First Time Buyer Mortgages interest relief applies to people building their own house?

K-9

kitty25 wrote: »

I am thinking about buying a house or build a house. Do you know if First Time Buyer Mortgages interest relief applies to people building their own house?

It should.

Revenue.ie is very good if you want confirmation.

kitty25

kitty25 wrote: »

I am thinking about buying a house or build a house. Do you know if First Time Buyer Mortgages interest relief applies to people building their own house?

Yes, but only if it's the first mortgage you have ever had.

kitty25

Thanks for reply. I've tried revenue.ie but couldn't find anything about it.
I have one more question. I am a new on tha forum and generally have quite small experience with internet forums. Does anyone knows if there is any useful topic on board.ie for Self Builders? Kind of what do you need to think about before you start or make decision? I don't want to pay rent anymore and want to have own house. I've looked few houses already, but none of them looks like my dreamed one.

kitty25

kitty25 wrote: »

Thanks for reply. I've tried revenue.ie but couldn't find anything about it.
I have one more question. I am a new on tha forum and generally have quite small experience with internet forums. Does anyone knows if there is any useful topic on board.ie for Self Builders? Kind of what do you need to think about before you start or make decision? I don't want to pay rent anymore and want to have own house. I've looked few houses already, but none of them looks like my dreamed one.

"Rec/home & Garden/construction & planning" forum is what you want

tanyabond

K-9 wrote: »

It can be taken of the payment, you don't have to pay tax to get it!

Do you mean of your monthly mortgage payment???

And so what happens if this gets changed from June, would it be only available for people who bought in prior to June, or it wouldn't be available to anyone?

K-9

You could have a nosey about these ones:

Home and Garden - boards.ie

You could try this on the interest relief:

Tax Relief for Mortgage Interest Paid on a Home Loan

K-9

tanyabond wrote: »

Do you mean of your monthly mortgage payment???

And so what happens if this gets changed from June, would it be only available for people who bought in prior to June, or it wouldn't be available to anyone?

Yes, when you fill out the forms and get the payment, your bank will take account of it and reduce your payment. It's usually paid into your mortgage account though I've seen it paid into Current Accounts.

Not sure on FG's proposals in that regard. We'll probably find out next week if it's part of a coalition deal.

Dades

K-9 wrote: »

Not sure on FG's proposals in that regard. We'll probably find out next week if it's part of a coalition deal.

According to the Indo this morning:

Independent wrote:

Instead, the new Fine Gael/Labour plan sets out a range of measures to help strapped homeowners:

• Banks and building supported by the State will have to cut standard variable rates by 0.25pc by making internal savings.
• First-time buyers who bought between 2004 and 2008 will get extra interest relief. This could be worth €166 a month on a €300,000 mortgage.
• The State's Money Advice and Budgeting Service (MABS) will get legal powers to help protect families from creditors.
• Changes to bankruptcy laws will be fast-tracked

.

Was keeping any eye on this as I bought in 2004 so just about make their cut. Problem is, we've outgrown our house and have to move. :P

Treehouse72

Brilliant, yet more of my tax money being spent paying other people's mortgages, and helping to sustain a bubble that I did nothing to cause.

And the fact that most people will see the continued repossession moratorium and the MIR "help" as acts of compassion and generally a good thing just goes to show just what a nation of peasant simpletons we still are. The level of debate and critical thinking about this stuff is a bloody embarrassment to a supposedly educated and civilised country.

professore

Treehouse72 wrote: »

Brilliant, yet more of my tax money being spent paying other people's mortgages, and helping to sustain a bubble that I did nothing to cause.

And the fact that most people will see the continued repossession moratorium and the MIR "help" as acts of compassion and generally a good thing just goes to show just what a nation of peasant simpletons we still are. The level of debate and critical thinking about this stuff is a bloody embarrassment to a supposedly educated and civilised country.

You (and me) can pay a multiple of your tax money directly to the banks, NAMA and the ECB/IMF if you prefer ... as we need to halt the otherwise inevitable wave of repossessions which will cost us all far more. Speaking here as someone who has no mortgage. It's all sh1t whatever way you slice it.

danbohan

professore wrote: »

You (and me) can pay a multiple of your tax money directly to the banks, NAMA and the ECB/IMF if you prefer ... as we need to halt the otherwise inevitable wave of repossessions which will cost us all far more. Speaking here as someone who has no mortgage. It's all sh1t whatever way you slice it.

or you can do as 1000+ per week are doing and tell them you fjuked it up you pay for it .

professore

Deleted User wrote: »

+1
And to add, with the current global financial situation & peak oil, it will never actually bottom out! what will happen is that prices in certain "high costs" areas, i.e. those far away from jobs, shops etc will continue to fall, while those in urban areas will eventually start to rise in relative value, but that rise may be still below inflation.

Unless people start paying you to take their houses, it must bottom out if it reaches zero

Treehouse72

professore wrote: »

You (and me) can pay a multiple of your tax money directly to the banks, NAMA and the ECB/IMF if you prefer ... as we need to halt the otherwise inevitable wave of repossessions which will cost us all far more.

As it happens I WOULD prefer my tax money to be used to fill holes left in the banks by repossessions rather than it directly subsidising hopeless mortgages. At least that way, my money is being spent finding a floor on the property market. As it is, it is being used in sustaining that market and yet more of it will be needed when the arse eventually falls out of that market anyway. So I will be paying twice this way - once now to sustain a mortgage that can't be repaid, and again later when it eventually fails. Why not just bloody well do it now?

And, no, we don't need to halt the repos - we need to HASTEN them. Find a bottom on the market, help restore competitiveness and lift people away from the crushing burden of debt misery. That is genuine compassion and social responsibility. What the new government propose is neither. It is stupid and cruel.

And I haven't even mentioned moral hazard, which is hugely germane to this debate and another argument in support of my view.

Rabidlamb

Treehouse72 wrote: »

Brilliant, yet more of my tax money being spent paying other people's mortgages, and helping to sustain a bubble that I did nothing to cause.

And the fact that most people will see the continued repossession moratorium and the MIR "help" as acts of compassion and generally a good thing just goes to show just what a nation of peasant simpletons we still are. The level of debate and critical thinking about this stuff is a bloody embarrassment to a supposedly educated and civilised country.

Treehouse old bean, speaking as someone who will benefit from the increased TRS I thank you & your kind for selflessly funding our dig out.
It may be more galling for you to learn that I don't really need it but cheers anyway.
I'll get you back in 14 years when I own my house.:D

Monty Burnz

Rabidlamb wrote: »

I'll get you back in 14 years when I own my house.:D

Of course, you may not live that long. Beware of gloating, the universe has a way of biting you in the arse!

Zamboni

Rabidlamb wrote: »

Treehouse old bean, speaking as someone who will benefit from the increased TRS I thank you & your kind for selflessly funding our dig out.
It may be more galling for you to learn that I don't really need it but cheers anyway.
I'll get you back in 14 years when I own my house.:D

Disgusting attitude.

Treehouse72

Rabidlamb wrote: »

Treehouse old bean, speaking as someone who will benefit from the increased TRS I thank you & your kind for selflessly funding our dig out.
It may be more galling for you to learn that I don't really need it but cheers anyway.
I'll get you back in 14 years when I own my house.:D

Proving that in some people's minds it will forever be 2005. I hope it's as pleasant over there as it is here in the sunlit uplands of the debt-free.

In the meantime, enjoy the negative equity. Enjoy being stuck where you are with no ability to sell and move. Enjoy paying the bank interest that over time will almost double the price you paid for the house in the first place. Enjoy the fact your property will probably be worth less in 14 years than you paid for it in real terms. Enjoy the tsunami of interest rate rises coming from next month on. Enjoy your TRS and MIR for the 1 or 2 or 3 years it exists before the IMF tell us to ditch it. Enjoy your considerable costs of ownership - life assurance, maintenance, decoration, insurance, upcoming property taxes, water charges, bin charges - that the MIR will hardly even put a dent in.

Above all, enjoy the fact that you are a fully signed-up fellow-traveller with the stupidest generation of politicians, bankers and voters in the history of the state. You seem inordinately proud of your financial acumen, when in truth buying a property during the biggest property bubble in world history puts your judgements on these matters on a par with an innumerate toddler.

JJJJNR

Everyones going to be paying "life assurance, maintenance, decoration, insurance, upcoming property taxes, water charges, bin charges etc " unless you live in your mammys, and if you are well then fcuk off out of this thread.

Caoimhín

JJJJNR wrote: »

Everyones going to be paying "life assurance, maintenance, decoration, insurance, upcoming property taxes, water charges, bin charges etc " unless you live in your mammys, and if you are well then fcuk off out of this thread.

Eh, what about renting?