Upcoming Irish property tax to cost 'on average' €1000 per house.(can you afford it?)

Am Chile

dvpower wrote: »

He reckons that the 1m of houses includes loads of landlords and this brings the number of individual householders registered to back down to 50%.
Naturally enough, he didn't provide any figures to back this up.

He also thinks we can do away with austerity measures and instead we could get the 'wealthy' to pay.

He didn,t say all the properties registered were belonging to landlords but a significant porition were, a recent report in the Irish times also states this.

Some 47
of those who paid after getting letters sent by local authorities were
major landlords owning more than 20
properties each.


One landlord who owns 130
homes paid almost €15,000, just under €2,000 of which was
in late payment penalties.





Those with multiple properties made payments in relation to 17,705 houses and apartments.


Just over 1,600 properties
were owned by 47 landlords,
who own a minimum of 20
properties each, but waited more than three months past the deadline to pay
their charges.


The largest payment came from the owner of 130 properties.


The next largest was a landlord of 100 properties, while a third owns
82 homes.

http://www.irishtimes.com/newspaper/ireland/2012/0815/1224322197721.html

There has being other reports of landlords registering and paying for multiple properties.

A LANDLORD has forked out €19,000 on the household charge for
190 properties.





Several household charge registrations received every day are for
50 homes or more –
reflecting the appetite for house buying during the Celtic Tiger.

http://www.independent.ie/national-news/landlord-forks-out-19000-household-charge-for-190-properties-3073068.html

Valetta

Noreen1 wrote: »

You said:

Out of interest, I answered, since you both asked a question - and answered it yourself, with your more "baseless innuendo statement" - inaccurately, as it happens!

I'm just trying to be helpful, here!:p:D:D

But he didn't get an interest free mortgage, so the article is irrelevant.

alastair

bgrizzley wrote: »

even he admitted this tax was unfair...

No he didn't. He said the HHC's flat rate wasn't a fair system. Which would be a more valid point if it wasn't pegged at a level lower than banded property tax will be, and wasn't a temporary/introductory arrangement.

bgrizzley

alastair wrote: »

No he didn't. He said the HHC's flat rate wasn't a fair system. Which would be a more valid point if it wasn't pegged at a level lower than banded property tax will be, and wasn't a temporary/introductory arrangement.

he said it was "obviously unfair". its a valid point at E100 or 1c

alastair

bgrizzley wrote: »

he said it was "obviously unfair". its a valid point at E100 or 1c

It's more fair than the TV licence on that basis - given it's a temporary/one-off arrangement and costs less.

Noreen1

Valetta wrote: »

But he didn't get an interest free mortgage, so the article is irrelevant.

He got interest only loans, to enable him to buy two properties.

Phil Hogan, the minister responsible for collecting the household charge, availed of "soft" loans of close to €900,000 that were approved by toxic building society boss Michael Fingleton who has cost the State €5.4bn.
Hogan's unorthodox loans were personally approved by Fingleton to allow him buy a pied-a-terre house in Dublin 4 and a luxurious penthouse in Portugal using two interest- only loans of at least a decade each, an aggressive equity release, and what appears to have been, for his final loan, minimal paperwork.

If he got an interest free loan, over ten years, the annual repayments would have been €90,000.
So, which do you think was more beneficial to him?

The plan was rather obviously to pay the interest, sell the property at a profit after ten years, repay the principal - and live in/rent the property at minimal cost over the 10 year period.
The point being, it's a very nice deal for those that can get it, especially when you compare it to the Banks previous policy of "aggressively targeting ordinary people" who were in arrears with loans.

In addition, it shows just how out of touch with reality both Phil Hogan, and Michael Fingleton were. That doesn't really inspire confidence in Mr Hogans judgement, and, for me personally, raises questions about his competence to steer this Country out of the mess the whole property fiasco left us in.

It's also interesting just how generous Fingletons retirement package was.

IMO, that particular transaction was a prime example of reckless lending.

We'll have to wait and see how the proceedings being brought by IBRC pan out.

Monty Burnz

Noreen1 wrote: »

It's also interesting just how generous Fingletons retirement package was.

Fingleton retired under FF's watch.

Mind you, any politician getting any sort of favourable treatment stinks as far as I am concerned.

alastair

Noreen1 wrote: »

If he got an interest free loan, over ten years...

But he didn't.

alastair

Noreen1 wrote: »

The plan was rather obviously to pay the interest, sell the property at a profit after ten years, repay the principal - and live in/rent the property at minimal cost over the 10 year period.
The point being, it's a very nice deal for those that can get it, especially when you compare it to the Banks previous policy of "aggressively targeting ordinary people" who were in arrears with loans.

It was pretty common for investors to get interest only loans during the boom - for exactly the strategy you outline. You could get them as a residential borrower as well - Bank of Scotland for one offered them. This really isn't that unusual. It's also prefectly viable that a bank can offer interest-only deals and 'aggressively target' arrears.

Noreen1

Monty Burnz wrote: »

Fingleton retired under FF's watch.

Mind you, any politician getting any sort of favourable treatment stinks as far as I am concerned.

It doesn't matter whose watch he retired under, as far as I am concerned.
No politician should have gotten favourable treatment. As you said, it stinks.
There's also the question of how many more people got favourable treatment - and who were they?

Valetta

Noreen1 wrote: »

It doesn't matter whose watch he retired under, as far as I am concerned.
No politician should have gotten favourable treatment. As you said, it stinks.
There's also the question of how many more people got favourable treatment - and who were they?

If getting an interest only mortgage for a number of years is favourable treatment, then I am one of those.

What is your point?

Noreen1

alastair wrote: »

But he didn't.

Care to answer this question?

Noreen1 wrote: »

He got interest only loans, to enable him to buy two properties.


If he got an interest free loan, over ten years, the annual repayments would have been €90,000.
So, which do you think was more beneficial to him?

alastair wrote: »

It was pretty common for investors to get interest only loans during the boom - for exactly the strategy you outline. You could get them as a residential borrower as well - Bank of Scotland for one offered them. This really isn't that unusual. It's also prefectly viable that a bank can offer interest-only deals and 'aggressively target' arrears.

Ah, but Bank of Scotland isn't Irish Nationwide - and they didn't give the loans in question - complete with questionable paperwork for the last one, to Phil Hogan - hence their lending practices are irrelevant to the point that Phil Hogan got a very favourable deal from Irish Nationwide.

Now, the facts are that Phil Hogan didn't get an interest free mortgage - he got an interest free loan, which was more beneficial than an interest free mortgage, hence the original statement about an interest free mortgage may not have been 100% accurate - but it certainly was not "baseless innuendo", as you alleged.

Valetta

But he didn't get an interest free loan either.

alastair

Noreen1 wrote: »

Ah, but Bank of Scotland isn't Irish Nationwide - and they didn't give the loans in question

Really?

Because this borrower seems to believe otherwise: http://www.askaboutmoney.com/showthread.php?t=170993

and someone else in this thread: http://www.askaboutmoney.com/showthread.php?t=71918

Any other IN mortgage holders know how to make head or tail of the statement? Got mine yesterday, the mrtg is interest only and the figure in the balance column is what I expected.

It would seem that the 'unorthodox' is rather more common than it used to be.

bgrizzley

alastair wrote: »

It's more fair than the TV licence on that basis - given it's a temporary/one-off arrangement and costs less.

thats true, although you could sell your tv if you didnt like that one. selling the roof over your head would be a bit more difficult and you will still pay as a renter.

alastair

bgrizzley wrote: »

thats true, although you could sell your tv if you didnt like that one. selling the roof over your head would be a bit more difficult and you will still pay as a renter.

Selling your house because of distaste for a one-off 100 euro payment might be considered something of an over-reaction too.

golden lane

i am a bit concerned.....there seem to be people posting that seem to think that politicians doing shady deals are ok.........and citizens not agreeing with a tax are the baddies....

is that what ireland has come to........shocked!!!!!!!

Noreen1

Valetta wrote: »

If getting an interest only mortgage for a number of years is favourable treatment, then I am one of those.

What is your point?

Unless your mortgage is with Irish Nationwide, or you are a Politician or developer, I couldn't care less what your mortgage arrangements are.

My point, is that interest only loans, over a 10 year period, to buy property - especially during a boom - is reckless speculation.

When those loans are given to Politicians or Developers, especially without proper documentation, then there are obviously questions to be answered, since the normal procedure is to require an identifiable take out, such as a pension or endowment plan.
In addition, these loans assume that the property will increase in value over the term of the loan, or that the pension or endowment plan will achieve its target by the end of the loan term - and we all know that neither of these things always happen.

Hence, these loans/mortgages are inherently speculative in nature, but especially so during a Housing "boom" - since booms are invariably followed by "busts".

Unfortunately for the Irish taxpayer - neither senior management in our Banks, nor our elected officials, appeared to be aware of this - or else they didn't care.
But then, why would they - sure the rest of us were always going to pick up the tab, anyway - and they knew it!

bgrizzley

alastair wrote: »

Selling your house because of distaste for a one-off 100 euro payment might be considered something of an over-reaction too.

totally agree, which is why 700,000 homeowners are protesting this tax by not paying it...

alastair

bgrizzley wrote: »

totally agree, which is why 700,000 homeowners are protesting this tax by not paying it...

...yet.

and we've gone down to 600,000 at this stage.

Noreen1

Valetta wrote: »

But he didn't get an interest free loan either.

Apologies for the typo. He got an interest only loan - which, as I have already stated, was more beneficial to him.

dvpower

Noreen1 wrote: »

It doesn't matter whose watch he retired under, as far as I am concerned.
No politician should have gotten favourable treatment. As you said, it stinks.
There's also the question of how many more people got favourable treatment - and who were they?

Who got favourable treatment?
I posted earlier Morgan Kelly's calculation last year that most second property mortgagee were interest only. There isn't anything favourable about them at all.

alastair

Noreen1 wrote: »

Unless your mortgage is with Irish Nationwide, or you are a Politician or developer, I couldn't care less what your mortgage arrangements are.

As we've learned - Irish Nationwide did indeed offer interest-only mortgages. So there's nothing unorthodox evident in Hogan's borrowings so far.

alastair

Noreen1 wrote: »

Apologies for the typo. He got an interest only loan - which, as I have already stated, was more beneficial to him.

An interest-only mortgage - available to other customers.

bgrizzley

alastair wrote: »

...yet.

i think most of the old people have paid up, there's noone left to scare:eek:

dvpower

golden lane wrote: »

i am a bit concerned.....there seem to be people posting that seem to think that politicians doing shady deals are ok.........and citizens not agreeing with a tax are the baddies....

is that what ireland has come to........shocked!!!!!!!

What shady deal are you referring to, and what makes it shady?

alastair

bgrizzley wrote: »

i think most of the old people have paid up, there's noone left to scare:eek:

Good thing they get the telly licence fee waived then - they'd be terrified by those 'sponger' ads otherwise.

tayto lover

Noreen1 wrote: »

Just as a matter of interest:

http://www.independent.ie/business/irish/nationwides-soft-loan-to-hogan-3161567.html




Finally.

Hmm. Interesting.

But they don't want to discuss that on a moral basis at all Noreen. They will tell you to get back on track while calling you a law breaker for not paying the HHC.
Double standards. I even asked how he could afford the repayments on his wages and again -- no answer.

ART6

bgrizzley wrote: »

even he admitted this tax was unfair...

His arguments were probably the most ludicrous I can ever remember having heard. A tax on property is not a "wealth tax", since the value of one's property has no reflection upon one's income. For example, my house might be worth €200,000, but it costs me money in maintenance and local authority service charges etc. It does not generate any income at all unless I sell it, and even then I have to find somewhere else to live and pay for that out of the proceeds of the sale. It is a wealth on paper only.

Even if the tax were to be based on the value of the property or that of the land on which it is built, what happens in times as of late when property values have declined by southwards of 50%? Do the taxes get adjusted accordingly? Weekly? Monthly? Annually? No a hope in hell -- they will stay at whatever value was decided by the powers that be when the values were at peak, and they will be jacked up every year as a convenient way of stripping even more money out of the pockets of those who actually earn something.

It has been argued in some ignorant quarters that the tax should be based upon what the property could be rented out for, and that is also bewilderingly stupid. Sure, I could rent out my property, but then were would I live?

In the interview it was also suggested that every country in the EU has some form of property tax, and so that makes it alright. It is immaterial whether those taxes are fair or realistic. It is sufficient to state that they exist and so we must have the same. Such taxes create a guaranteed source of revenue. In fact, however they are evaluated, they are a form of income tax. Period. They are income tax because the only means anyone has of paying them is from income, and to suggest that the only alternative would be to increase income tax is typical of the spin and lies invented by the political class.

It can, of course, be argued that the possession of property is an investment (although that has been somewhat disproved of late). That might be reasonable if such things as amortisation and maintenance are taken into account in assessing the investment value. So I could argue that if I bought my property for (say) €200,000 and owned it for five years, during which I paid €5,000 a year on maintenance and amortisation, and then I sold it for €300,000, I have a net gain of €100,000. However, if I have not then paid off the amortisation I do not have any net gain and it has also cost me the maintenance cost. Therefore, I would accept a tax upon the net gain after amortisation with an allowance for maintenance - in other words money that I can put into my bank account and spend. This is not difficult to do -- it is the basis for the taxation system applied to every company in the land, and it is called corporation tax.

What this comes down to for me is that taxes should be based upon liquid assets -- that is those assets like salaries and wages and property sales etc. that result in a net income. Fixed assets that are essential for the continuation of the business or the family should be subject to tax allowances. So any income that is a net worth gain -- salaries, pensions, property sales etc. -- should be subject to tax but not fixed assets until they are sold and become liquid assets. Trying to suggest that there are levels of tax that each pay for local services as distinct from national ones, and should be considered separately is typical of the fraudulent approach of successive governments. All deductions from incomes are tax, whatever the revenue is used for.

I retired at the end of last year. I enjoy the benefit of two small private pension schemes, and a reduced state pension. I pay tax on those and I expect to do so. I do not expect to pay for my fixed asset that I cannot convert into cash.

bgrizzley

tayto lover wrote: »

But they don't want to discuss that on a moral basis at all Noreen. They will tell you to get back on track while calling you a law breaker for not paying the HHC.
Double standards. I even asked how he could afford the repayments on his wages and again -- no answer.

maybe he could afford it by not paying some other bills Tayto

http://www.independent.ie/national-news/phil-hogan-refuses-to-pay-4k-service-charges-on-his-portugal-holiday-penthouse-3067684.html