Housing Bubble Bursting

iguana

Deleted User wrote:

My last post on this, because it is off topic but you are misinformed.

He has no financial interest in my house. Technically he rents a room from me. Check out the rent-a-room scheme if you can be bothered learning how it works regarding tenancy and tax.

If what you are claiming was true, every single person renting in a house with an owner-occupier would "have a financial interest" in the house and therefore lose FTB status.

It's really not that difficult to understand.

He'll be your husband. Of course he has financial interest in the property he lives in which belongs to his wife. Again, not everyone running the country is an idiot. I'd tread very carefully as far as the course of action you are considering is concerned. Of course you might get away with it. On the otherhand several years after he makes his purchase you may get landed with a bill for the duty he avoided, the interest relief he took against the spirit of it's intention and the interest on the money owed for the time he had it.

information

SimpleSam06 wrote:

Hahaha, legend. I'm trying to figure out a way for you to understand what I'm saying, while still remaining within the charter, and its just not coming.

Don't worry about it a lot of people find it difficult to make a clear, concise point and communicate it in an effective manner.

SimpleSam06 wrote:

The full sentence was: Shelling out "rewards" by cutting your profit margins for anything isn't part of any business model.

Yes that was your original point that you then conceded was incorrect by you introducing loss leading.

Point 1
"We Pay 2k towards your legal costs in mortgages"
I am wrong or is this some sort of reward scheme ?

Point 2
How loss leading works in the mortgage market.
Current account are now loss leader products, they even pay people to open them, this is so they can sell them other products such as mortgages.
Discount on your first year is a loss leading strategy. It gets people in the door to buy the mortgage, banks then make the money back over the lifetime of the mortgage.

Strategy.
Its all the same strategy, it tweeked slightly for each market.
If anyone wants to give me a solid example of where it wouldn't work, I can admit when I made a mistake.

SimpleSam06 wrote:

This is like watching the blind leading the Helen Keller. How many bulls have been lurking this thread for the last hundred pages? Own up!

We both posted about the quality of your posts in this thread and your flip flopping, how does that make us bullish.

EDIT
This is getting off topic so I will only be posting one more time, so as not to ruin the thread.

SimpleSam06

information wrote:

Don't worry about it a lot of people find it difficult to make a clear, concise point and communicate it in an effective manner.

I find its much easier when the listener doesn't cherry pick comments and then base their wafflings upon that.

information wrote:

Yes that was your original point that you then conceded was incorrect by you introducing loss leading.

Ah this reminds me of the early days of these discussions, people bending over backwards telling us a two bed in Tallaght was good value at half a million. Potential, roysh!! I really strongly suggest you look up that strawman definition again.

information wrote:

Waffle 1
"We Pay 2k towards your legal costs in mortgages"
I am wrong or is this some sort of reward scheme ?

You're wrong, in the context of this discussion. Thats an incentive to buy, not an adjustment of ongoing rates. Its a once-off incentive too, unlike ongoing rates adjustments.

information wrote:

Waffle 2
How loss leading works in the mortgage market.
Current account are now loss leader products...over the lifetime of the mortgage.

No no no no. Did you even read the link? Loss leaders bring people into a shop in order that they buy other, profitable, products. Adjustments in agreed interest rates have zero to do with this.

I have the funny feeling I'm feeding a troll here.

information wrote:

Waffle 3, Strategy.
Its all the same strategy, it tweeked slightly for each market.
If anyone wants to give me a solid example of where it wouldn't work, I can admit when I made a mistake.

I seriously doubt that. You've proven unable to wrap your mind around even the simplest approaches to marketing and customer retention, so pointing out your mistakes would be an exercise in futility at this point.

information wrote:

We both posted about the quality of your posts in this thread and your flip flopping, how does that make us bullish.

So you fail to understand what we're talking about here, inject your half baked interpretations of it all, and then accuse people of reversing their positions on economic theories you patently don't understand. Great.

information wrote:

EDIT
This is getting off topic so I will only be posting one more time, so as not to ruin the thread.

You seem to be labouring under the impression that anyone is paying attention to you, besides me, big troll feeder that I am. You wouldn't happen to be a woman, would you? I feel the title "miss" would sit well in front of your name tag.

Afuera

Afuera wrote:

If he is technically renting a room from you under the rent-a-room scheme then you will have to make a tax return dictating this to Reveune. Also, if he is paying more than 7,620 EUR a year in "rent" you will have to pay tax on all of the money he pays you.

I KNOW!

Jeez, why is it assumed I’m a total idiot and don’t know what I’m doing?
I’m NOT his wife.
My fiance is an FTB, it’s really as simple as that.
The ifs and buts and whens are endless, the fact is as things stand now, he is a FTB.

I regret ever contributing to this thread, the overwhelming presumptions about other posters are so tiresome.
It’s easier to read when it’s just a bunch of people agreeing with each other, kinda like the Muppets’ Statler and Waldorf grumping up in their balcony!

Colonel Sanders

I know of couples who married where one of them did not own a house but lived with the other. They still availed of first time buyer status when trading up. However whether or not rent paid etc was declared in full I don't know.

daveirl

This post has been deleted.

iguana

Deleted User wrote:

I regret ever contributing to this thread, the overwhelming presumptions about other posters are so tiresome.
It’s easier to read when it’s just a bunch of people agreeing with each other, kinda like the Muppets’ Statler and Waldorf grumping up in their balcony!

It sort of sounds like you are the one who doesn't want anybody else to disagree with them. When people point out that you are basically planning tax evasion you become insulting and accusing people of begrudgery.

I live in the UK, where I own a pretty nice house (well I own about 57% of it and owe my building society for the rest). I have never owned property in Ireland and could certainly come back home claiming to be a ftb, buy a big house and pay no SD. I know lots of people who have done similar and so far haven't been caught. And I can see why they have risked it, it is certainly tempting, especially now in the face of no SD for ftbs and increases to inrerest relief. Of course there is no guarantee that they won't open the post tomorrow and find out that they've been caught and now owe money to the Revenue that they don't have.

It is tax evasion, it is illegal and you could be caught. Just becasue you don't like it doesn't make it so.

And can I just check if the term fiance still implies an intention to marry?

iguana

iguana wrote:

It sort of sounds like you are the one who doesn't want anybody else to disagree with them. When people point out that you are basically planning tax evasion you become insulting and accusing people of begrudgery.

I live in the UK, where I own a pretty nice house (well I own about 57% of it and owe my building society for the rest). I have never owned property in Ireland and could certainly come back home claiming to be a ftb, buy a big house and pay no SD. I know lots of people who have done similar and so far haven't been caught. And I can see why they have risked it, it is certainly tempting, especially now in the face of no SD for ftbs and increases to inrerest relief. Of course there is no guarantee that they won't open the post tomorrow and find out that they've been caught and now owe money to the Revenue that they don't have.

It is tax evasion, it is illegal and you could be caught. Just becasue you don't like it doesn't make it so.

And can I just check if the term fiance still implies an intention to marry?

What part of my situation don't you understand? There is NO tax evasion, nor plan for it. I don't and won't owe Revenue a cent, everything we are doing is completely legal. I avail of the rent a room scheme so my fiance can retain FTB status.
If you don't like that, tough!

You couldn't claim FTB status in Ireland in any case because you have previously owned a property. It doesn't matter where that property is. My mate's purchase of a poky flat in Oz prevented her from availing of FTB status here.

Fiance implies intent to marry, yes. When we do that is our business!

TCollins

Longfield wrote:

TCollins I think you're in the "denial" phase, look at this graph and tell me how it hasn't mirrored the Irish market so far?

I'm not in any phase. Where have i stated which way property is going? I dont know which way it is going at all.
Neither do you, but i dont go around attributing comments to people that they havent made.

Read the post again will you. Thats the problem in this thread. People take one side or the other and are so clouded in their judgement that they cant just admit that they do not know, any more than the next man what way property is going.

I would dearly love a nice big price drop (not such a big drop as to damage the economy though) as much as anyone else, but i just dont see it at the moment, and i refuse to predict whether property is going up or down just so i can argue one side or the other.

TCollins

iguana wrote:

And can I just check if the term fiance still implies an intention to marry?

An intention to marry is not married though.
I know so many people who were engaged to a person they never married and are now married to other people.

Colonel Sanders

daveirl wrote:

This post has been deleted.

honestly no idea if they declared everything or not but they have gotten away with, well for the time being anyhow.

chump

Deleted User wrote:

What part of my situation don't you understand? There is NO tax evasion, nor plan for it. I don't and won't owe Revenue a cent, everything we are doing is completely legal. I avail of the rent a room scheme so my fiance can retain FTB status.
If you don't like that, tough!

You couldn't claim FTB status in Ireland in any case because you have previously owned a property. It doesn't matter where that property is. My mate's purchase of a poky flat in Oz prevented her from availing of FTB status here.

Fiance implies intent to marry, yes. When we do that is our business!

You're threading on thin ground and if you don't realise that and want to stick your head in the sand - so be it. TAX EVASION

Calina

Deleted User wrote:

What part of my situation don't you understand? There is NO tax evasion, nor plan for it. I don't and won't owe Revenue a cent, everything we are doing is completely legal. I avail of the rent a room scheme so my fiance can retain FTB status.
If you don't like that, tough!....

Fiance implies intent to marry, yes. When we do that is our business!

To some extent, all of this is your business. However, since this is a message board and it is vaguely relevant to the situation of the property market in Ireland, I'm going to comment further on it. I think you're wrong. I think you're very wrong on several fronts, and I think you're wrong because you are getting hung up on holding on to your fiancé's FTB status. That's a very short term point of view.

For him to maintain his status as an FTB means that you would have to abdicate any financial or beneficial interest in his home into the future and if you are planning to marry him, that is extremely unwise of you. If, god forbid, you were to separate, and had contributed - however unofficially or via rent-a-room to his mortgage, the division of assets could get very complicated in the event of a split. As it is, it could already be messy were you to separate in the morning. I don't know - it depends on how nasty people want to be. Obviously your fiancé may not make a big deal of having paid money to you in support of your mortgage as it could have a negative impact on his FTB status, on the other hand, the sums of money concerned could see him wanting to cash in. I do not know and you cannot depend on it.

If you are, later, to exploit his FTB - say after you get married, then if you are married his FTB status should be gone if you are buying together. If you do abdicate yourself of any beneficial interest in a property which he may buy for you to live in together, so that he can maintain his FTB than I think you are extremely unwise as this would almost certainly come back and bite you in the event of a marital split. For women, in particular, since they tend to get the burden of economic hardship in terms of raising kids such as in the case of taking career breaks to have and nurture children, which has knock on effects in pension contributions further down the line, I think this is extremely important to bear in mind.

That, incidentally, is aside from whether I think it's technically correct that you can do what you're doing. I don't think it's right, it certainly wasn't the reason that the scheme was introduced in the first place. It's not illegal for you to live together, certainly, but I'd be interested in the view of the Revenue Commissioners whether they agree that a couple living together can avail of the rent-a-room scheme. I suppose technically speaking, if you were sleeping in separate rooms, you could.

But then, again, not a tax expert...

chump

chump wrote:

You're threading on thin ground and if you don't realise that and want to stick your head in the sand - so be it. TAX EVASION

Explain to me in clear and concise terms how I am committing tax evasion.

Revenue is alerted to the fact that I rent a room, and I pay tax as applicable under the rent-a-room scheme. This scheme is widely available, above board and legal.
Should my fiance purchase a property in his own name, using his own money, he is a first time buyer.

Based on those FACTS, and not PRESUMPTIONS or IFS or BUTS there is no tax evasion taking place.

Finally, I'm tired of having to explain the most basic elements to various posters who, despite a lot of bluster, don't actually know what they're talking about and will cast aspersions without READING posts properly.
I'm not here to educate people on the ins and outs of property buying in Ireland. We're all on the internet here folks, the FACTS are easily accessible to us all.

Calina

Calina wrote:

To some extent, all of this is your business. However, since this is a message board and it is vaguely relevant to the situation of the property market in Ireland, I'm going to comment further on it. I think you're wrong. I think you're very wrong on several fronts, and I think you're wrong because you are getting hung up on holding on to your fiancé's FTB status. That's a very short term point of view.

For him to maintain his status as an FTB means that you would have to abdicate any financial or beneficial interest in his home into the future and if you are planning to marry him, that is extremely unwise of you. If, god forbid, you were to separate, and had contributed - however unofficially or via rent-a-room to his mortgage, the division of assets could get very complicated in the event of a split. As it is, it could already be messy were you to separate in the morning. I don't know - it depends on how nasty people want to be. Obviously your fiancé may not make a big deal of having paid money to you in support of your mortgage as it could have a negative impact on his FTB status, on the other hand, the sums of money concerned could see him wanting to cash in. I do not know and you cannot depend on it.

If you are, later, to exploit his FTB - say after you get married, then if you are married his FTB status should be gone if you are buying together. If you do abdicate yourself of any beneficial interest in a property which he may buy for you to live in together, so that he can maintain his FTB than I think you are extremely unwise as this would almost certainly come back and bite you in the event of a marital split. For women, in particular, since they tend to get the burden of economic hardship in terms of raising kids such as in the case of taking career breaks to have and nurture children, which has knock on effects in pension contributions further down the line, I think this is extremely important to bear in mind.

That, incidentally, is aside from whether I think it's technically correct that you can do what you're doing. I don't think it's right, it certainly wasn't the reason that the scheme was introduced in the first place. It's not illegal for you to live together, certainly, but I'd be interested in the view of the Revenue Commissioners whether they agree that a couple living together can avail of the rent-a-room scheme. I suppose technically speaking, if you were sleeping in separate rooms, you could.

But then, again, not a tax expert...

You know of no couples who lived together where one party owned a property and the other contributed to the mortgage or bills?
You feel it would be proper in the event of a relationship breakdown that the non-owner should forfeit FTB status because of this?

Calina

Actually, all the couples I know bought houses together as couples, strange as it may seem to you.

As it happens, in the case of a relationship breakdown, your fiancé does not forfeit his FTB. The question mark hangs over a) whether you can claim rent a room exemptions in this particular case of you being a couple and b) whether his FTB status applies should you subsequently buy another PPR for you both to live in together as a couple. You claim in both cases that you can and it does. I am not sure that it should.

Given that this appears to distort the housing market in this country further beyond what is already messed up due to speculation, I question whether there should be any stamp duty exemption for first time buyers at all. And I say that as an FTB myself.

Calina

Calina wrote:

Actually, all the couples I know bought houses together as couples, strange as it may seem to you.

As it happens, in the case of a relationship breakdown, your fiancé does not forfeit his FTB. The question mark hangs over a) whether you can claim rent a room exemptions in this particular case of you being a couple and b) whether his FTB status applies should you subsequently buy another PPR for you both to live in together as a couple. You claim in both cases that you can and it does. I am not sure that it should.

Given that this appears to distort the housing market in this country further beyond what is already messed up due to speculation, I question whether there should be any stamp duty exemption for first time buyers at all. And I say that as an FTB myself.

I mentioned earlier about divorcees reverting back to FTB status also. That will also cause a distortion.

As for Revenue's opinion on the situation, well if my partner was same-sex, we would never be married.
Would every home-owner renting a room to a person of the same gender have to prove they're not in a relationship to avail of rent-a-room?

I'm done on this particular discussion!

iguana

Deleted User wrote:

Explain to me in clear and concise terms how I am committing tax evasion.

Deleted User wrote:

For example, I bought my home by myself with no financial help from anyone.
I meet my mortgage repayments easily.

When my fiance, who earns more than me, moves in we’ll be sharing those repayments and in a position to pay more off the mortgage.
Neither of us want to sell my house, but in the event that we do he will retain first time buyer status.
Long term we’d both like to move to where he is from, as his parents own land with full planning permission for three homes.

There is no doubt from your original comments on this issue that you would have beneficial interest in each other's properties. You are not planning on each buying a property for personal use. Each property would be your shared home. You are talking about a man you refer to as your fiance buying a home for the two of you in the long-term future.

You can try and rationalise it over and over but you will be buying a joint home after previously owning a joint home. You will both have houses which the other could easily be deemed to have beneficial interest in. Those are the two words you need to understand. If Revenue decide you have beneficial interest in each other's pprs they will be very much entitled to come looking for their money back 10/15 years down the line. And if they do they will be looking for every cent of lost interest.

I'm not saying this to get at you, so you should really lose the hostile attitude. My grandfather's brother was an incredibly rich man, he was a millionaire back in the 80's when IR£1m was a phenomenal amount of money. By the time he died he had nothing, not because he went on a mad spending spree, the guy would have made Scrooge look like a spendaholic. But because he evaded tax and decades later Revenue came looking and took nearly everything he had. I for one would rather not go down the route of losing my home because I tried to screw the system, and I'd hate to see that happen somebody else.

TCollins wrote:

An intention to marry is not married though.
I know so many people who were engaged to a person they never married and are now married to other people.

I know but in this case Favourite Slave is talking about a plan in her and her partner's long-term future. The chances are they will be married at this point, but if they have split up then his ftb status will still stand.
You could do this and get away with it. Just like I could come home and not declare that I owned a UK property and get away with it. But they would both be tax evasion. The

iguana

iguana wrote:

I know but in this case Favourite Slave is talking about a plan in her and her partner's long-term future. The chances are they will be married at this point, but if they have split up then his ftb status will still stand.
You could do this and get away with it. Just like I could come home and not declare that I owned a UK property and get away with it. But they would both be tax evasion. The

Do what? Get away with what?
He's not getting away with anything - he's a first time buyer until such time as he buys a property.

You can't compare this to you "not declaring" you own a UK property.
He doesn't have anything to declare, because he doesn't own anything!

You are confusing tax AVOIDANCE with tax EVASION.

I AVOID paying high car tax by choosing to drive a small vehicle. I AVOID paying VAT on cigs by not buying them.

Avoiding tax is perfectly legal my friend. Now our esteemed Beverly Cooper Flynn knows all about tax EVASION...

edited to add: Don't I have a 'beneficial' interest in my parents home by virtue of the rent I paid for six years there and the fact that it will be inherited by me?

iguana

Deleted User wrote:

Do what? Get away with what?
He's not getting away with anything - he's a first time buyer until such time as he buys a property.

You can't compare this to you "not declaring" you own a UK property.
He doesn't have anything to declare, because he doesn't own anything!

I have a property abroad, your fiance has beneficial interest in your house. If neither of us declared these facts on purchase of a ppr in Ireland we would both be evading tax. Are going to tell me that he has no beneficial interest in your property? Well I don't believe you. And if somebody working for Revenue chose not to believe you then you would both be in trouble.

Deleted User wrote:

You are confusing tax AVOIDANCE with tax EVASION.

No I am not. No right-thinking person would believe that you had no beneficial interest in each other's properties. Especially when in your original post on the subject you talked in a whole lot of WEs. As in WE will be sharing mortgage repayments. Claiming no beneficial interest is a down-right lie. You are attempting to pull a fast one and that is evasion.

Deleted User wrote:

Don't I have a 'beneficial' interest in my parents home by virtue of the rent I paid for six years there and the fact that it will be inherited by me?

For somebody who accuses people of not reading other people's posts you certainly don't read theirs. Miju posted a link to the relevant Revenue page which clearly states that inheritances are exempt from SD.

Nermal

iguana wrote:

No right-thinking person would believe that you had no beneficial interest in each other's properties. Especially when in your original post on the subject you talked in a whole lot of WEs.

Iguana, what legal relationship exists here? They are engaged, not married. As far as the law is concerned, they are single people living together.

iguana

Nermal wrote:

Iguana, what legal relationship exists here? They are engaged, not married. As far as the law is concerned, they are single people living together.

The Revenue makes reference to the spouse or partner who can have beneficial interest in a property.

Glenbhoy

Right, in fairness favouriteslave was not talking about tax evasion, only avoidance, I think there's a reasonable chance it'd be legitimate, if foolhardy, others disagree - however, since all of us are only speculating, it'd be better to read through this thread
http://www.askaboutmoney.com/showthread.php?t=57231
and then post your scheme there and see what they think.
Now, back to the 'bubble', anyone else noticing a possible pick up in the market?

nesf

Glenbhoy wrote:

Now, back to the 'bubble', anyone else noticing a possible pick up in the market?

If there is one it could very easily be people who were holding back waiting for stamp duty changes etc but it wouldn't last very long.

BendiBus

Glenbhoy wrote:

Now, back to the 'bubble', anyone else noticing a possible pick up in the market?

There does appear, based simply on estate agents signs in gardens, to be some pick up in activity. But not necessarily in prices. A small number of buyers will have returned post-election, but I think an even larger number of sellers will appear soon in the hope of a continued increase in the number of buyers. If the sellers enter the market faster than buyers (which I think is likely), then supply will stay ahead of demand and a downward price spiral may well follow.

I think we're looking at a game of chicken between buyers and sellers at the moment. Who gives way first depends on wider economics - interest rates, employment, rents etc.

patrickolee

BendiBus wrote:

I think we're looking at a game of chicken between buyers and sellers at the moment. Who gives way first depends on wider economics - interest rates, employment, rents etc.

I think you might be right.

On another note heard on the radio this morning that the number of new planning permissions is dramatically down, which will lead to less new houses towards the end of the year. I wonder will it be enough to keep supply/demand balance?

SimpleSam06

patrickolee wrote:

On another note heard on the radio this morning that the number of new planning permissions is dramatically down, which will lead to less new houses towards the end of the year. I wonder will it be enough to keep supply/demand balance?

That depends on whether you are factoring in the 150,000 to 250,000 (depending on who you talk to) empty houses around the country into your supply and demand equation or not...

Colonel Sanders

are there any official figures on the number of empty houses/apartments?

I have seen several developments in Dublin, for example, that are half empty yet there are still another 1 or 2 apartmenst blocks being build within a stone's throw.

Are developers profit margins high enough that they can afford to keep a certain proportion of properties unoccupied to keep prices up?

SkepticOne

patrickolee wrote:

On another note heard on the radio this morning that the number of new planning permissions is dramatically down, which will lead to less new houses towards the end of the year. I wonder will it be enough to keep supply/demand balance?

Reduction in supply would certainly have a moderating effect on price drops. However why it is happening is important, imo. Is it that a) builders are concerned for those to whom they have sold properties and are therefore cutting back on supply to keep prices up or b) builders can't sell their properties and are forced to cut back?

SkepticOne

Colonel Sanders wrote:

are there any official figures on the number of empty houses/apartments?

CSO Census 2006.