Property Tax Anyone pay Stamp Duty in the last few years??

grahamo

P. Breathnach wrote: »

It is not at all obvious that people with more than one house can better afford a property tax. That house might be heavily mortgaged, in negative equity, and it might not be let, or it might be let at a rent that does not even cover the mortgage interest.

If being a property owner is so tough why have property developers been mopping up every dogbox on the market for the last 15 years?
They have made it almost impossible for couples with young families to buy a home as prices went up and up.

If the rent didn't cover the mortgage why would they bother investing? Is it because they have strong social consciences and feel its their duty to provide reasonably priced accomodation to those who can't afford their own home? Is it S***e!
They are in it to make money! Investment properties are luxuries. If you can afford one you can afford property tax.

dave-higgz

r0nanf wrote: »

While that could work in other countries you wouldn't stand a chance here. I lived in Dublin 8 for a good few years and good luck charting the value of houses there based on size or street.

Do you live in a 3 bed semi?

Nah 5 bed semi FYI, tiny garden though.

jimmmy

ManFromAtlantis wrote: »

it might be unpopular to say this but i think a property tax on all houses is fairer than just those with 2nd homes. in fact i would suggest a property tax on all but 2nd, 3rd etc would be exempted . and no i dont have 2 houses. its just that the guy with 2 houses is likley to be feeling the pinch alot more than those with one.
and as some said , they have paid alot of taxes in the purchase of that ball and chain.

I have to agree. Maybe 2nd houses in places like Dublin city centre are worth something, as they can be rented out....but there are many people with 2,3 or 4 apartments in the middle of nowhere ( relatively speaking ) ....no offence to the good people of Leitrim, Roscommon, Sligo, Longford etc....which are empty and a huge cash drain on the owners, many of whom have made huge sacrifices already and are nearly bankrupt......two-thirds of dwellings in Leitrim are vacant. I think many people cannot get their head around the negative equity / loss many people have made, after being encouraged to invest in the Irish economy by the govt who promised tax incentives etc

P. Breathnach

r0nanf wrote: »

We need more tax sure, but another way to bridge the gap is to lessen expenditure severely.

Sure. But that's not nearly enough.

For example we are still talking about the poxy metro north, which was a joke in good times and it's perverse at this stage.

It's not going anywhere in the present circumstances.

Get people back to work to increase the income tax take - pump money into capital building projects that are necessary (i.e. public hospitals and schools) to re-employ out of work builders while serving the public need.

What about "cutting expenditure severely"?

Re-draw the whole tax system from scratch, lose PRSI and create three tax bands to maximise the claw from workers. Our current model has collapsed and this notion of meaningless small-scale taxes that are notionally implemented (1% levy, pension levy etc) are nothing short of ridiculous. Start fresh.

Do it all with income tax, then? What might the rates be?

P. Breathnach

grahamo wrote: »

If being a property owner is so tough why have property developers been mopping up every dogbox on the market for the last 15 years?
They have made it almost impossible for couples with young families to buy a home as prices went up and up.

If the rent didn't cover the mortgage why would they bother investing? Is it because they have strong social consciences and feel its their duty to provide reasonably priced accomodation to those who can't afford their own home? Is it S***e!
They are in it to make money! Investment properties are luxuries. If you can afford one you can afford property tax.

That was then; this is now. Many people who bought to rent are in huge financial difficulties because the market has turned against them, both the capital value of the properties they bought and the rental income they can earn.

A tax based on spite or resentment, or on an unrealistic view of how things actually are, is both socially unjust and unlikely to produce the revenue required.

[I do not have any investment property, so I declare a lack of interest.]

gearoidc

They are in it to make money! Investment properties are luxuries. If you can afford one you can afford property tax.

What is it about this that you can't get your head around???

Those of us who could "afford" one already did pay tax.
Bucketloads of it.

SkepticOne

The advantage of a property tax is that it can't be avoided in the ways that income tax is. You can't simply move your property abroad to avoid paying taxes on it in Ireland. However for political reasons it would probably be necessary to grant a period of exemption to those who paid stamp duty recently.

I would rather see more efforts to cut costs rather than raise taxes though. All raising taxes does is help improve the public finance problem. But this public finance problem is merely a symptom of a much larger problem of competitiveness, and competitiveness is not improved by raising taxes!

yoshytoshy

In a small country like ours ,income tax/other taxes should have been high to balance things and keep the housing market stable.

We should be decreasing taxes now ,but we cant:rolleyes:

Dannyboy83

r0nanf wrote: »

We need more tax sure, but another way to bridge the gap is to lessen expenditure severely. For example we are still talking about the poxy metro north, which was a joke in good times and it's perverse at this stage. Get people back to work to increase the income tax take - pump money into capital building projects that are necessary (i.e. public hospitals and schools) to re-employ out of work builders while serving the public need.

Re-draw the whole tax system from scratch, lose PRSI and create three tax bands to maximise the claw from workers. Our current model has collapsed and this notion of meaningless small-scale taxes that are notionally implemented (1% levy, pension levy etc) are nothing short of ridiculous. Start fresh.

I whole-heartedly agree with your sentiments, but you're not being realistic.
How long would it take the government to accomplish just a mere 1 of those tasks?

This government could not accomplish all of this in 4 years.


Its hard to be realistic with going to the usual government bashing but that is the absolute reality. Even with a good government of dedicated statesmen, something like that would take time.
And worst of all, the Dail sit for so little time, that the inevitable arguments which need to be fleshed out, will never be fleshed out properly and the drama will continue, every party will want to do it there on way and .......................zzzzzzzzzzzzzzzzZZZZZZZZZZZZ....................

You get the picture.

The fact is that there has been talk of impending doom since 2005.........That is 4 years in which the government had to prepare contigency plans for an 'inevitable' situation.

As it stands, we are nearly 8 months into the 'visible' crisis, and they have still not formulated a plan.

The government had 10 years to fix many of these problems, spent billions and billions of Euro on HSE etc., and its still not fixed.
And now we face a situation, where we have no money.

A. We cannot rely on this government to implement reform.
B We are not even sure if we can rely on this government to implement correct taxation.
(It would appear they are more corcerned with their trip on the government jet to see Barrack Obama for St.Patrick's day)

Therefore the only probable course of action is that we are going to be taxed harshly and for a number of years in order to close the defecit.


If you are unhappy about any of this, then it is your responsibility to use your vote and ensure that a less incompetent group of people are running the country. That is really about the only legal thing you can do to fight back.

Dannyboy83

dave-higgz wrote: »

Would a property tax by area of house be a feasible option??
Social housing to be exempt.
3 bed semis pay little and large mansions with gardens pay the most?
I know of course there are huge gardens in the countryside but I feel there's a workaround

I have already suggested Land Value Tax.
Scotland are seeking to introduce this.
Hong Kong have used it for years.

This would ensure that the highly rich contribute proportionately more than the impoverished.
It would also likely get the ball off to a slow rolling start in the construction and property sectors.

One problem however, is that its wide open to the exact problems of corruption (see Hong Konh) which Ireland already experienced, just highly unlikely in the current economic climate.

It would also call for a bit more fairness in the realm of taxation of those who recently purchased their homes and paid stamp duty.

Dannyboy83

SkepticOne wrote: »

The advantage of a property tax is that it can't be avoided in the ways that income tax is. You can't simply move your property abroad to avoid paying taxes on it in Ireland.

Precisely.

However for political reasons it would probably be necessary to grant a period of exemption to those who paid stamp duty recently.

I would rather see more efforts to cut costs rather than raise taxes though. All raising taxes does is help improve the public finance problem. But this public finance problem is merely a symptom of a much larger problem of competitiveness, and competitiveness is not improved by raising taxes!

True, but in the game of politics, competitiveness and reducing expenditure means cutting public wages and cutting public jobs.

Cutting public wages and cutting public jobs has a threefold negative impact:
A) More people on social welfare
Increasing the tax burden, again

More defaults & Bankruptcy, Less money in the economy
Making the current problem worse than ever

C) Less votes for Fianna Fail
Its indisputable at this stage that FF are putting the party first and the country 2nd.
They have only the short term in mind, if they had taken pragmatic action, they could have had years of long term support, but thats a different argument.


Ultimately, we are far from competitive and a country mile from cheap, especially the public sector.
A large amount of the population are so over-leveraged that they simply cannot take wage reductions.
Many of these people will inevitably lose their assets over the next number of years and some will have to declare bankruptcy, its just a matter of 'when'.
We know that the property market is going to plummet, especially as we move into deflation. (currently at 0.9%)

r0nanf

P. Breathnach wrote: »

It's not going anywhere in the present circumstances.

They're still talking about it, there were public submissions this week

P. Breathnach wrote: »

What about "cutting expenditure severely"?

You'll note I said capital building projects that are necessary, ones that are distinct from the current pissing-against-a-wall-for-fun-style expenditure. Example heard on RTE radio this morning about the 600 Garda cars purchased (without discount), and then the paint job given to a company that couldn't do more than a few a week - the net result being many brand new cars sitting in storage for 18 months. Do you know our last budget included a 70m prize fund for the dog&horse industry? When we can't afford 8m or so for children with learning difficulties. I am talking about priorities.

P. Breathnach wrote: »

Do it all with income tax, then? What might the rates be?

I'm no economist but it strikes me as ridiculous that we don't have three bands - how about 22%, 44% and 65% off the top of my head. That way some middle income earners wouldn't be completely up the sh*t with the new proposed 48%, and those above 125k would be on 65%.

Of course I'm not advocating doing it all with income tax, but we should maximise our take from it. Close off the section 23s and other loopholes, and have a progressive system, where road tax goes on roads, and income tax goes on health/education. The current cashpile system is part of our problem as the money is appointed on whims of departments.

Re draw the whole lot

r0nanf

Dannyboy83 wrote: »

C) Less votes for Fianna Fail
Its indisputable at this stage that FF are putting the party first and the country 2nd.
They have only the short term in mind, if they had taken pragmatic action, they could have had years of long term support, but thats a different argument.

+1 Save the party, they've always been that way.

It's the equivalent of putting the good china into the lifeboats on the Titanic

Raiser

Is it time to leave yet? At this rate Zimbabwe is going to look attractive in about 6 weeks time.......

dodgyme

who do you want to tax if you were having a property tax?

I think the lads that own anything more then 3 or 4 houses probably benefitted the most and gained the most. Most people with one or two houses may have traded up and couldnt sell the second one or kept it as a pension or something but I know loads of case of fella would had houses in rathmines which were bought well before the said tiger and converted to apartments and the rents escalated as soon as the tiger took off. These same people then bought houses from the new tiger stocks in places like swords/D15/dundrum etc and covered them with renters. Therefore my conclusion is any chap with more then 4 houses probably had alot of wealth at the start of the boom and was in the position to benefit the most from the boom by adding to this bank of houses- he should be hit the most and not the lads with one house which they live in. The tax should be increased on a scale for every additional house owned and assets need to be watched to ensure they dont do sneeky transfers to the kids to avoid paying etc.

jimmmy

dodgyme wrote: »

I think the lads that own anything more then 3 or 4 houses probably benefitted the most and gained the most.

Do not forget many people got 90% or 100% mortgages....or remortgaged and used the value of their first house to borrow for the 2nd, 3rd etc. As another poster rightly said, many people who bought to rent are in huge financial difficulties because the market has turned against them, both the capital value of the properties they bought and the rental income they can earn. Two thirds of dwellings / apartments in places like Leitrim are vacant. Whole complexes + housing estates...its errie. Remember a tax based on spite or resentment, or on an unrealistic view of how things really are, is both socially unjust and will never produce the revenue required.

dodgyme

jimmmy wrote: »

an unrealistic view of how things really are, is both socially unjust and will never produce the revenue required.

So are you telling me that people who owned 10 houses are the same as people would own one or even 2?

Where I live individuals came in and bought 10 or 20 houses and then rented them to mainly HSE rent supplement people. That smells of corruption to me? These people should be hit and I dont think its unrealistic?? It happened so its realistic

To me they are a different catagory and should be hit the most. I am talking about dublin mainly here not leitrim. The question with leitrim is who bought them and why? but that is not really my point!

yoshytoshy

dodgyme wrote: »

I think the lads that own anything more then 3 or 4 houses probably benefitted the most and gained the most.

Do you actually know any of these people ?

I've done loads of work for young couples ,who invested in extra properties and none of them were well off.
Most of them ,do it for their kids so that they can be sent to college in years to come.

The boom is more or less ten years old ,mortgages are on average 20-25 years long. Probably half the second home mortgages are in there fith or sixth year.

Even without taxes a lot of these houses will be up for sale and the banks will be looking for there money.

Any idea on the trouble we might be in then ? ,another bail out maybe ?

dodgyme

jimmmy wrote: »

Do not forget many people got 90% or 100% mortgages.

I dont know anyone who would had to get a 100% mortgage for their main house that has a "property portfollio"

dodgyme

yoshytoshy wrote: »

Do you actually know any of these people ?

I've done loads of work for young couples ,who invested in extra properties and none of them were well off.?

I am not talking about young couples. Where I live there are people who bought upwards of 10 houses in one go. The guy who owns the houses around me owns 4 or 5 and is mates with another guy would owns the same, since I was looking for phone numbers where renters may be causing issues. When the estate was being built there were lines of houses where the same alarms/furniture/gasfires etc were put along the houses like an assembly belt(not too hard to work it out). These are not young couples but greed f*cks and the estate had no social housing elements.

yoshytoshy

dodgyme wrote: »

I am not talking about young couples. Where I live there are people who bought upwards of 10 houses in one go. The guy who owns the houses around me owns 4 or 5 and is mates with another guy would owns the same, since I was looking for phone numbers where renters may be causing issues. One chap bought 9 large houses and converted them into 27 apartments. When the estate was being built there were lines of houses where the same alarms/furniture/gasfires etc were put along the houses like an assembly belt(not too hard to work it out). These are not young couples but greed f*cks and the estate had no social housing elements.

Fair enough ,but I don't see how you differentiate one landlord from another.
Most big timers like this ,would have houses in company names etc and are probably hard to track down.

techdiver

yoshytoshy wrote: »

Do you actually know any of these people ?

I've done loads of work for young couples ,who invested in extra properties and none of them were well off.
Most of them ,do it for their kids so that they can be sent to college in years to come.

Bull**t. People bought extra property for greed! Plain and simple. Buy now, sell on for a profit in a years time. That was the motto of the thousands of Irish property "moguls" over the past decade.

I have no sympathy for them. Some of us had sense, why should we prop these people up. They've already gotten a bailout from the government through the amnesty on repossessions albeit from AIB and BOI, as a direct result of the bank recapitalisation.

yoshytoshy

techdiver wrote: »

Bull**t.

Fair enough ,rase the taxes .

Houses aren't selling at the moment and I can't see banks selling for less ,it will devalue a market they are heavily invested in.

We will see , where it will take us.

techdiver

yoshytoshy wrote: »

Fair enough ,rase the taxes .

Houses aren't selling at the moment and I can't see banks selling for less ,it will devalue a market they are heavily invested in.

We will see , where it will take us.

Like it or not the massive devaluation of the market is what was required in the long term. Maybe people will not sign up to the single biggest financial decision of their life in future without doing some background research. Many houses were purchased and investors were born based on bar stool economics. The collapse has happened, hopefully this will be a lesson for generations to come. I'm not sure though.....

yoshytoshy

techdiver wrote: »

Like it or not the massive devaluation of the market is what was required in the long term. Maybe people will not sign up to the single biggest financial decision of their life in future without doing some background research. Many houses were purchased and investors were born based on bar stool economics. The collapse has happened, hopefully this will be a lesson for generations to come. I'm not sure though.....

Thats been the case for years and low taxes created a false sense of security for a lot of people.
I believe we shouldn't purposely hammer house prices down though ,it will kill the bit of morale left in the country.

btw ,I'm not a property investor myself.

dodgyme

yoshytoshy wrote: »

Fair enough ,but I don't see how you differentiate one landlord from another.
Most big timers like this ,would have houses in company names etc and are probably hard to track down.

this is exactly the problem. Its not for me and you to fix this but for the revenue to get these feckers. The fat pigs should be fried first.

dodgyme

techdiver wrote: »

Bull**t. People bought extra property for greed! Plain and simple. .

yes and no, yoshytoshy is not completely off the money. I know one fella (a cousin). He bought a second house pre-boom (1991ish) to rent and have for the kids to go to college. Years later none of his kids went to college in this city. By the time they were old enough to go to college he had changed from a person who bought for the college kids to a mini landlord. He was on a high wage in the public service and did basically feck all work. He has said that himself BTW. He had loadsa time for other stuff (property watching) and also after a house or two he got greedy. I dont know how many houses he ended with but I would guess very conservatively he'd have 5 minimum. i know this by speaking to his family. I never asked him directly as you swear by the way he goes on he hasnt a penny. There are alot like him.

Ludo

A couple of years ago, three guys I worked with all decided to buy new houses and keep their existing houses as rentals to make a bit of money. I remember these guys sitting around in the canteen at work actually competing to see who owed the banks the most money and they thought they were great. Each of them had mortgages of over 800K at least. They thought that were going to be rolling in the dosh.

I found the whole greed of it disgusting at the time. I had my own house with a 35% mortgage and was more than happy with it. They couldn't believe my attitude. I wonder how they are feeling now. They all have young families so I do feel for them but I have my own worries now with my own job and family.

This kind of attitude (from my experience) seems to have been quite common and is responsible in (small) part at least for the current mess.

Why should I pay for their greed and the stupidity of the banks and government? I paid my stamp duty (twice in the last ten years in fact as I had to move house). If they come looking for a property tax from me on my residence they can feck off!!!

Edit: Income taxes should go up...excise duty should go up and a few other things...but NO WAY am I paying property tax on my primary residence. I have no problem paying my share.

jmayo

There is no way we can start differentiating betwen classes of landlords as in who bought what when and who is in negative equity.

The properties were bought to avail of capital returns down the road and provide a rental return to cover the investment costs of the mortgages.

If the property is not a primary place of residence then it is an investment, thus it should be taxed through a property tax and rental returns should also be subject to tax.

It doesn't matter diddly squad if you bought the property two years ago with 90% mortgage and paid big stamp duty or 40 years ago with little stamp duty.
IMHO all property including primary residences should have some form of property tax as we used to have with rates. The only thing is the amount for primary residence (which is not recieving any rental returns ala rent a room) should be much less than that for investment properties.
BTW for anyone not old enough to remember, rates of course were gotten rid of by another famous FF government that left the economy in tatters.

Something I am beginning to notice in a lot of statements, is that some people do indeed feel that there needs to be tax increasing or new taxes together with cuts in government spending, but because of their personal situation they should not be affected.
This presonal situation does not allow it argument was indeed used by a FG spokesman and RTE presenter.

One argument used by a poster was that they pay high management fees so why should they pay any property tax, another is that they bought at height of the boom and paid high stamp duty.
Well my answer is tough. We all pay.
I have a property where I need to put a new roof on old extension, does that mean that I should get a dispensation ? My answer is NO.

I get the feeling more than a few people are soon going to realise that fancy cars (convertibles, SUVs etc), new cars, foreign holidays, weekends away, club memberships, meals in restaurants, concerts, designer labelled clothes, cable/satelite tv, broadband, the latest mobile phones are just a few of the items that will be considered luxuries in the new Ireland.

I can see a huge chunk of those born post 1980 having a difficult time grasping our new reality.

ManFromAtlantis

Ludo wrote: »

A couple of years ago, three guys I worked with all decided to buy new houses and keep their existing houses as rentals to make a bit of money. I remember these guys sitting around in the canteen at work actually competing to see who owed the banks the most money and they thought they were great. Each of them had mortgages of over 800K at least. They thought that were going to be rolling in the dosh.

I found the whole greed of it disgusting at the time. I had my own house with a 35% mortgage and was more than happy with it. They couldn't believe my attitude. I wonder how they are feeling now. They all have young families so I do feel for them but I have my own worries now with my own job and family.

This kind of attitude (from my experience) seems to have been quite common and is responsible in (small) part at least for the current mess.

Why should I pay for their greed and the stupidity of the banks and government? I paid my stamp duty (twice in the last ten years in fact as I had to move house). If they come looking for a property tax from me on my residence they can feck off!!!

Edit: Income taxes should go up...excise duty should go up and a few other things...but NO WAY am I paying property tax on my primary residence. I have no problem paying my share.

look i see your point and understand how u feel but
(a) its not illegal to invest
(b) these guys paid stamp etc already and by the sound alot more than you.
(c) would u accept the point that, not all single house owners are poor and not all 2,3 house owners are well off ?

by not investing you by default have become better off than those who did invest at the wrong time. should tax reflect this or ignore this?