Property to fall by 20% in 2013 - Fitch

Farmer Pudsey

AlekSmart wrote: »

Yep your farmership,I understand all of this,all I am trying to understand is how have literally billions of Europeans managed to live their lives without all these "social advantages" ?

I'm baffled ?

Have you ever see the ould wan walking home with the two bags of messages because she cannot afford a bus and definetly not a taxi.

If you have a substancial pension it will not matter, it also is not an issue in Spain, Portagul and Italy or southern France. However you often do not see these people as they virtually cannot afford to live. Lad was saying to me about mobile home camps in southern England do not know as ahve not been there although I have seen one in France

AlekSmart

Farmer Pudsey wrote: »

Have you ever see the ould wan walking home with the two bags of messages because she cannot afford a bus and definetly not a taxi.

If you have a substancial pension it will not matter, it also is not an issue in Spain, Portagul and Italy or southern France. However you often do not see these people as they virtually cannot afford to live. Lad was saying to me about mobile home camps in southern England do not know as ahve not been there although I have seen one in France

Most of the "Ould Wans" I interact with would not be caught dead walking any distance as they fully utilize the benefits of the DSP Free Travel Scheme.

I have also travelled within France and did indeed expect to find dispossesed "ancients" thrown out on the side of the rue....however apart from the odd middle aged wino I failed to find the masses I expected.

The only elderly folks I encountered in the South of France were relaxed enough playing Petanque and smoking foul smelling tabac,whilst giving out merde about plans to increase local Taxation to fund Public Transport improvements.....c'est la vie I guess ?

senordingdong

murphaph wrote: »

Yep and they will be BTL landlords. Renting is not going to get any cheaper in Dublin over the coming years IMO as buying will simply not be an option (due to no lending) for the majority of those who would like to commit.

Are you suggesting that buying in Dublin will become more economically viable than renting in Dublin?

creedp

AlekSmart wrote: »

Yep your farmership,I understand all of this,all I am trying to understand is how have literally billions of Europeans managed to live their lives without all these "social advantages" ?

I'm baffled ?

Are you baffled by the fact that anyone might consider the option to buy a house or simply the proportion of people who consider buying. Im sure there litteraly billions of europeans who have also owned houses ..

AlekSmart

creedp wrote: »

Are you baffled by the fact that anyone might consider the option to buy a house or simply the proportion of people who consider buying. Im sure there litteraly billions of europeans who have also owned houses ..

It's More the absence of any consideration at all which baffleth me,it was as if a decree had issued forth back around the mid 1980's which convinced us all that we had to own our own residential accomodation.

The billions of Europeans who owned their own houses,tended to do so in the full knowledge of the true expenses and responsibilities of that ownership...whilst we abolished domestic rates and staunchly resist(ed) any payment for the associated stuff of home ownership.

Mind you,Margaret Thatchers spirited extension of the Englishmans Home=Englishmans Castle principle did help,particularly when the tales of massive flipping profits crossed the Irish Sea.....egalitarianism lives !!!!

It was the beginning of a truly Golden Era

ballyharpat

bought an apartment today, 8% return on it after mgmt fees, prop tax etc taken out, it was going for 2 to 2.5 times this price about 4/5 years ago. and the rent was practically the same-sheer insanity....If the market drops, let it drop, sitting around twiddling your thumbs ain't gonna change anything, I've had the money sitting in the account for nearly a year now waiting for the right time and I feel comfortable that this is it...

AlekSmart

ballyharpat wrote: »

bought an apartment today, 8% return on it after mgmt fees, prop tax etc taken out, it was going for 2 to 2.5 times this price about 4/5 years ago. and the rent was practically the same-sheer insanity....If the market drops, let it drop, sitting around twiddling your thumbs ain't gonna change anything, I've had the money sitting in the account for nearly a year now waiting for the right time and I feel comfortable that this is it...

Well done,and at least you have had the benefit of reasoned consideration,rather than headlong rush.

Good Luck with the purchase.

maninasia

Well he/she should wait until they get their 8% return before proclaiming it.

creedp

maninasia wrote: »

Well he/she should wait until they get their 8% return before proclaiming it.

You don't think its achievable or do you think its crass for people to be boasting about making money from property in Ireland? If he said he was making an 8% return from a commercial lease would you be equally dismissive?

In relation to the 8% return .. is this before/after tax? I do think its fairly optimistic to earn an 8% return if you are tax compliant unless its your only source of income. If not its all subject to tax at the marginal rate/PRSI/USC. You can't even set off the full amount of interest on your loan against your income as you can in every other business in the land .. that's a measure of the level of disquiet people have in this country to the parasitic private accommodation landlord class. Imagine telling a commerical property owner/ano other business person he can't set the interest on his loan used to purchase a premises/business off against his lease/business income.

fliball123

gurramok wrote: »

No need to bring up the present birth rate in your argument to support any direction in house prices, it has no bearing other than present day couples would find mortgage financing harder to come by when kids are factored in. Bring up the pre 1992 birth rate by all means to gauge the amount of possible adult buyers out there.

There are way more negatives than positives affecting the direction of prices in 2013. Will it change in 2014 onwards? We'll have a better idea this time next year.

You don't just buy a house for the here and now you buy it for the future. Also the birth rate has been steadily inclining over the last 2 decades and children being born today will impact on property prices as I say if you look at it over the long term. these kids will be adults one day. I dont think it is prudent to buy a house for the here and now. I have not stated what direction I think house prices will go in. Its a crap shoot no one knows its all opinion even with the experts. All I did was put down what I think are some vital contributory factors which will feed into what the property prices in this country will be. I agree with you the more negative influences. As I said I put many of them in my opening post. I also agree that if your thinking of buying I would take a 6 month rule, as in wait 6 months and see whats happening

murphaph

senordingdong wrote: »

Are you suggesting that buying in Dublin will become more economically viable than renting in Dublin?

I would suggest that given the good yields (10% is to be had...you'll NEVER get that from a bank, but of course there are significantly more risks as a landlord than a deposit account holder) now available in central Dublin that it is already cheaper to buy right now than rent.

daddymac90

murphaph wrote: »

I would suggest that given the good yields (10% is to be had...you'll NEVER get that from a bank, but of course there are significantly more risks as a landlord than a deposit account holder) now available in central Dublin that it is already cheaper to buy right now than rent.

why would you buy anywhere else??

gurramok

fliball123 wrote: »

You don't just buy a house for the here and now you buy it for the future. Also the birth rate has been steadily inclining over the last 2 decades and children being born today will impact on property prices as I say if you look at it over the long term. these kids will be adults one day.

You're talking about 20 years time, not in 2013 as per topic!!

ballyharpat

creedp wrote: »

You don't think its achievable or do you think its crass for people to be boasting about making money from property in Ireland? If he said he was making an 8% return from a commercial lease would you be equally dismissive?

In relation to the 8% return .. is this before/after tax? I do think its fairly optimistic to earn an 8% return if you are tax compliant unless its your only source of income. If not its all subject to tax at the marginal rate/PRSI/USC. You can't even set off the full amount of interest on your loan against your income as you can in every other business in the land .. that's a measure of the level of disquiet people have in this country to the parasitic private accommodation landlord class. Imagine telling a commerical property owner/ano other business person he can't set the interest on his loan used to purchase a premises/business off against his lease/business income.

Hey, thanks.
To tell you the truth, it's a semi boast, but also a fact that money can be made in real estate right now. 8% is after I pay my taxes on it, I am (un)fortunate that I will be below the e31/32k threshold for higher taxes, so I'm not gonna be taxed that much on the income. I didn't need a mortgage, so the money was sitting there after I pulled it out of the stock market, and if I was lucky enough to make that kind of return in the market-given the current climate, I would be taxed anyway, and probably at a higher rate, with a bigger chance of losing some of my principal.

ANd referring to the previous poster, it's in a 'nice' location, all other apartments are rented there, Killarney is still a good place for rentals. To put the icing on the cake, I have a very, very wealthy friend that has been giving me some advice to get my money to work for me-other than the stock market. He has told me that if I feel I made a mistake and want to sell, that he will buy it off of me for the price I paid, less fees etc. He knows that I want to move from my own house to the country when the right property comes along, and says that on paper my purchased property, along with my own house, will look better to the bank especially since I will also be renting out my house down the line.

OMD

ballyharpat wrote: »

Hey, thanks.
To tell you the truth, it's a semi boast, but also a fact that money can be made in real estate right now. 8% is after I pay my taxes on it, I am (un)fortunate that I will be below the e31/32k threshold for higher taxes, so I'm not gonna be taxed that much on the income. I didn't need a mortgage, so the money was sitting there after I pulled it out of the stock market, and if I was lucky enough to make that kind of return in the market-given the current climate, I would be taxed anyway, and probably at a higher rate, with a bigger chance of losing some of my principal.

ANd referring to the previous poster, it's in a 'nice' location, all other apartments are rented there, Killarney is still a good place for rentals. To put the icing on the cake, I have a very, very wealthy friend that has been giving me some advice to get my money to work for me-other than the stock market. He has told me that if I feel I made a mistake and want to sell, that he will buy it off of me for the price I paid, less fees etc. He knows that I want to move from my own house to the country when the right property comes along, and says that on paper my purchased property, along with my own house, will look better to the bank especially since I will also be renting out my house down the line.

The point being made before (I think) is that you have not made 8% if you have just bought the place. You are projecting that you will make 8% which is very different. Many things can happen to reduce that forecasted profit or even to cause a loss

ballyharpat

OMD wrote: »

The point being made before (I think) is that you have not made 8% if you have just bought the place. You are projecting that you will make 8% which is very different. Many things can happen to reduce that forecasted profit or even to cause a loss

Okay, point taken, currently I could invest that money somewhere else, we'll say an interest bearing savings account, and make 3%? on it.
Okay, I could make a loss of 6/7% on it, if I decide to sell and have to settle fees myself, I will not need that money in the near future.
Given that I know of 3 others renting out apartments in the building and what their rent is, I am as confident as one can be that I will get a similar amount. Nothing is guaranteed in life, if you put it like that, I am projecting that I will be going to work in one hour, many things can happen.....I am projecting that I will have breakfast tomorrow.......unless the whole economy collapses in big steaming pile, I will be making 'circa' 8%. 8.21% if my maths are correct.
But thanks for the input, can't say it was useful or necessary, but I would say the same thing to someone who pulls out from a sideroad in front of me while I'm driving on a main road

OMD

ballyharpat wrote: »

Okay, point taken, currently I could invest that money somewhere else, we'll say an interest bearing savings account, and make 3%? on it.
Okay, I could make a loss of 6/7% on it, if I decide to sell and have to settle fees myself, I will not need that money in the near future.
Given that I know of 3 others renting out apartments in the building and what their rent is, I am as confident as one can be that I will get a similar amount. Nothing is guaranteed in life, if you put it like that, I am projecting that I will be going to work in one hour, many things can happen.....I am projecting that I will have breakfast tomorrow.......unless the whole economy collapses in big steaming pile, I will be making 'circa' 8%. 8.21% if my maths are correct.
But thanks for the input, can't say it was useful or necessary, but I would say the same thing to someone who pulls out from a sideroad in front of me while I'm driving on a main road

Standard expenses are about 2% a year for a property you rent out(probably higher now with property taxes). You should allow for property being empty for 2 months a year. So to make 8% before income tax & USC it means the monthly rent you are getting is 1% of the purchase price you paid. Of course my figures don't include USC, Income tax or PRSI that of course you will also have to pay. But you have calculated all this already.

I am simply pointing out you are not guaranteed 8.21%. You don't know how long you will have tenants for, you do not know if tenants will actually pay the rent, you don't know the repairs you may have to make after the tenants leave. These things are surprisingly common. Good luck to you and come back next year and let us know if you actually get 8% after taxes.

ballyharpat

I'm feeling a bit defensive here, for what reason, I don't know, it is only a forum where some people put out good information, some people tear it down...no matter, if you read the previous post, anything can happen to anything, the best one can do, is to try to have their ducks in a row and be prepared, I don't believe there is anything overlooked. When I was away for 11 years, I had my house rented one day after the other tenents moved out and went through 6 different tenents, I don't believe that the apartment will be empty, if it was empty, then I would reduce the rent, but I am already shooting on the medium of the scale, the cheaper end of the scale is a long term RAS tenent, which would still give a 7% return. I will have no problem getting tenents, if I did, then as a last resort I would turn it over to the RAS. Expenses will be less than 2%, about 1.75% and any work that has to be done on the property will be done by yours truly, as I was in the construction/renovations in my previous career.

And as I said, an unforeseen circumstance can/could pop up, I'll put it like this, there is no better investment for me right now with that amount of money, or if you have one, please let me in on it-I genuinely mean that, thanks.....

OMD

ballyharpat wrote: »

I'm feeling a bit defensive here, for what reason, I don't know, it is only a forum where some people put out good information, some people tear it down...no matter, if you read the previous post, anything can happen to anything, the best one can do, is to try to have their ducks in a row and be prepared, I don't believe there is anything overlooked. When I was away for 11 years, I had my house rented one day after the other tenents moved out and went through 6 different tenents, I don't believe that the apartment will be empty, if it was empty, then I would reduce the rent, but I am already shooting on the medium of the scale, the cheaper end of the scale is a long term RAS tenent, which would still give a 7% return. I will have no problem getting tenents, if I did, then as a last resort I would turn it over to the RAS. Expenses will be less than 2%, about 1.75% and any work that has to be done on the property will be done by yours truly, as I was in the construction/renovations in my previous career.

And as I said, an unforeseen circumstance can/could pop up, I'll put it like this, there is no better investment for me right now with that amount of money, or if you have one, please let me in on it-I genuinely mean that, thanks.....

Look I'm not trying to rain on your parade and I was trying to give you general advice. You got a cheap property with a very high yield (sounds like 12% from what you have said). i am serious when in saying well done on getting such a property. 12% is a fantastic yield and assuming there is no serious defect in property you should make a good return.

However you seem to be basing your figures on full occupancy but this will not happen all the time. You may be lucky occasionally to do it but normally there is a period of time between tenants. This time allows you to advertise for new tenants and carry out necessary repairs and perform general upkeep. Furniture etc will wear out. These will have to be replaced and these will cost. Property taxes (which will rise next year), PRTB registration, advertising and general upkeep all costs even if you do the labour yourself. It also costs your time which has to be factored in when comparing property to other investments.

Unfortunately you paid cash. It would have probably have been better to get a mortgage, get tax relief on some of the interest and put the money you used on deposit.

As I say good luck to you. I believe you are being over optimistic believing you will get a return of 8% after tax, USC & PRSI, but hey, if you do come back in a year or two and gloat at me. I won't mind:)

Farmer Pudsey

Ballyharpat

fair paly the man who never made a mistake never did nothing. Life a gamble you (or I) could get rolled over by a truck tomorrow morning. At present the figures on property are looking good. So you paid cash so what.

Worst case senario it drops 20% over the next two years and then it gains 40% over the next 10 after that. Rental yields look very good at present TBH too good. If it drops 20% you still are on a winner with the rent it is unlikly that rents will fall drasticlly.

If you bought it in Killarney you are in a good location. If it is empty in May you can make money on short term renting over the summer. Even during the winter if empty put it on DD and take a couple weekends rent ( you would often get a months rent for a long weekend) Killarney is a flexible location. Everybody is telling you about being empty in Killarney you can always rent short term if stuck. Someone always wants to go there for a week or weekend at short notice.

Even if it only yields 4% net longterm it will rise in value. was looking at houseprices in Kerry seems to be very reasonable for the location. Just a bit of oversupply at the moment some houses are for sale at mid ninties prices.

I think you picked a good investment I do not even think its a gamble.

gurramok

OMD wrote: »

This time allows you to advertise for new tenants and carry out necessary repairs and perform general upkeep. Furniture etc will wear out. These will have to be replaced and these will cost.

Thought that repairs and furniture expenses that are claimed by the landlord can be written off against tax? http://www.knowyourtax.ie/services/landlords/

ballyharpat

OMD wrote: »

Look I'm not trying to rain on your parade and I was trying to give you general advice. You got a cheap property with a very high yield (sounds like 12% from what you have said). i am serious when in saying well done on getting such a property. 12% is a fantastic yield and assuming there is no serious defect in property you should make a good return.

However you seem to be basing your figures on full occupancy but this will not happen all the time. You may be lucky occasionally to do it but normally there is a period of time between tenants. This time allows you to advertise for new tenants and carry out necessary repairs and perform general upkeep. Furniture etc will wear out. These will have to be replaced and these will cost. Property taxes (which will rise next year), PRTB registration, advertising and general upkeep all costs even if you do the labour yourself. It also costs your time which has to be factored in when comparing property to other investments.

Unfortunately you paid cash. It would have probably have been better to get a mortgage, get tax relief on some of the interest and put the money you used on deposit.

As I say good luck to you. I believe you are being over optimistic believing you will get a return of 8% after tax, USC & PRSI, but hey, if you do come back in a year or two and gloat at me. I won't mind:)

In my experience, if I rent long term, the tenent gives 1 months notice, that is plenty of time for me to get a tenent in the center of town-unless I sit on my arse, let's say I give even a week to repaint etc after a tenent moves out, still making good money. Structurally the building is sound, the engineer that owned the property, still owns two apartments in the building, one that he uses himself when he's not traveling one that he rents out. They were built in 1997, before the major boom, concrete floors, block walls that are drylined.

I paid cash because I could not get a mortgage as I have not had my job in this country long enough and I was also advised by someone that has made his (big) fortune in property and is still making big money, to pay cash, it still leaves me 50-70% cash to use as a deposit on the kind of property I am looking for, to live in myself, the stocks/shares are virtually worthless if I go in to the bank for a mortgage, but the apartment will be looked on favorably.

Thanks Farmer, you have given me some ideas that I can try if the worst comes to the worst, but really I can't see that happening as Killarney and Dingle are bot tourism spots that grew in 2012 and are expected to continue growing.

OMD, you still didn't provide me with a better investment opportunity?

OMD

ballyharpat wrote: »

,

OMD, you still didn't provide me with a better investment opportunity?

My point is, I believe you are being over optimistic on how much you believe you will earn. Thats all. i am not trying to get at you. You are talking about getting a yield of 12% on a property in Killarney. Less costs of 1.75% and less another 2% or so for income tax, PRSI & USC to get your 8.21% after tax income That is massive. The average yield in Killarney is 5% (based on asking prices) and at the moment there are 54 properties to rent in Killarney. Yet despite this you believe your property will be in such demand that you will never have vacant periods. You may be right and as I said, good luck to you and if you are right come back and gloat about it.

As for better investment, well it depends on what you want, how much risk you want to take and whether you want to run a business where you have to work (like being a landlord).

ballyharpat

okay, I'll tell you what, go ahead and look for 2 bedroomed apartments/houses for rent, under e600 per month.....it should come back with 7, now look through them and see where they are located? 5 of those 7 are located outside the town, 2 located within walking distance, mine is 'in' the town, I know theat considering the weather in Ireland, I would pay an extra e10 per week to be in the town as opposed to walking distance.....and there sir you have my proof of there not being an oversupply of apartments in town. Mine also has 2 bathrooms.
WHile you're at it, when you are on there check out how long those apartments have been listed, if you are honest, you will come back and say 11 hours

ballyharpat

And you forget, I was a landlord, from across the ocean, very very simple job once I had the right people to do what needed to be done and the building was sound in the first place.....

AlekSmart

ballyharpat wrote: »

And you forget, I was a landlord, from across the ocean, very very simple job once I had the right people to do what needed to be done and the building was sound in the first place.....

As an aside,Ballyharpat,do you still consider Landlording to be a "very very simple job" ?

I'm interested in this aspect,given the significant numbers of people who took-on the mantle of Landlordism as it appeared to be easy money.

OMD

ballyharpat wrote: »

okay, I'll tell you what, go ahead and look for 2 bedroomed apartments/houses for rent, under e600 per month.....it should come back with 7, now look through them and see where they are located? 5 of those 7 are located outside the town, 2 located within walking distance, mine is 'in' the town, I know theat considering the weather in Ireland, I would pay an extra e10 per week to be in the town as opposed to walking distance.....and there sir you have my proof of there not being an oversupply of apartments in town. Mine also has 2 bathrooms.
WHile you're at it, when you are on there check out how long those apartments have been listed, if you are honest, you will come back and say 11 hours

Best of luck with it. €55000 does seem a good price for it compared to what's available in Ireland. Was that what you paid?

ballyharpat

AlekSmart wrote: »

As an aside,Ballyharpat,do you still consider Landlording to be a "very very simple job" ?

I'm interested in this aspect,given the significant numbers of people who took-on the mantle of Landlordism as it appeared to be easy money.

If the building is in good condition, you follow the rules about running it as a business and don't make friends with your tenents, can do some basic handywork yourself, and the rental is close to your own primary residence, then yeah, it's an easy job.
It's a lot easier than having to follow the stock market to find out what/when to buy and what/when to sell. It takes a lot more cash to be a landlord to be a share trader.
Having said that, you get crappy tenents, and they can eat up 50% of your profit in a year if you don't keep an eye on it, by late/no rent. Damaged/missing items etc. But if you do a background check and get references and stay on top of them as soon as the rent is late, treat every rent check like a mortgage depends on it, but that can happen a lot easier with stocks shares, a stock can lose 50% or more in a day.

I'll give you an example, I have a friend that was renting out, for 3 years they had a great tenent, then they brought in a new one, the new one paid the first months rent and one months deposit, after 2 months the rent was a week late, then two weeks, you get the gist? anyway, he was away and they were supposed to give the backrent to me when he was gone, they made up bs excuses, I went over and laid it out that they were not yet there 3 months if the rent was not paid in full and continued to be paid in full every month that they would have to leave, there contract could be torn up in the first three months, it helps that my best friend is a lawyer and I do everything by the book, they are in there 8 months now and keeping to themselves and paying the full rent, you have to be firm, it's a business, and needs to be treated as such and they need to be treated with respect if they are fulfilling their end of the bargain.
If you have the cash, then go for it, I'm sure that in another post or two someone will pipe up with more downsides, and sure there are, but not frequently....-in my experience.

ballyharpat

I paid above the 55k mark for it, but don't worry, I have my figures worked out and it will be in and around 8%, property tax is replacing another tax, Property tax is e90 under 100k, mgmt fees-reasonable-this also covers insurance. taxes, prsi, usc, after I deduct a few expenses etc, it will still be a good investment.
Aleksmart, if you have any questions, I would talk to someone that has a few properties and see what loopholes are available, there are plenty and taxes can be reduced-legally. If I can be of assistance, but I do have minimal experience, please feel free to PM me.

maninasia

creedp wrote: »

You don't think its achievable or do you think its crass for people to be boasting about making money from property in Ireland? If he said he was making an 8% return from a commercial lease would you be equally dismissive?

In relation to the 8% return .. is this before/after tax? I do think its fairly optimistic to earn an 8% return if you are tax compliant unless its your only source of income. If not its all subject to tax at the marginal rate/PRSI/USC. You can't even set off the full amount of interest on your loan against your income as you can in every other business in the land .. that's a measure of the level of disquiet people have in this country to the parasitic private accommodation landlord class. Imagine telling a commerical property owner/ano other business person he can't set the interest on his loan used to purchase a premises/business off against his lease/business income.

My point is simply he/she needs to wait to see what they actually earn. It's a simple concept.

Lorna Dooley

Well after years of renting in Germany I am definitely going to buy a house in west Ireland. Really miss family the sea the country and its cheaper in the west, there are a lot of good offers at the moment if you look at daft.

carpejugulum

They underestimate EU's ability to kick it down the road.

uberalles

I wonder if local demand and local supply is a major factor like rent prices.

Farmer Pudsey

ballyharpat wrote: »

I paid above the 55k mark for it, but don't worry, I have my figures worked out and it will be in and around 8%, property tax is replacing another tax, Property tax is e90 under 100k, mgmt fees-reasonable-this also covers insurance. taxes, prsi, usc, after I deduct a few expenses etc, it will still be a good investment.
Aleksmart, if you have any questions, I would talk to someone that has a few properties and see what loopholes are available, there are plenty and taxes can be reduced-legally. If I can be of assistance, but I do have minimal experience, please feel free to PM me.

Figures make it a no brainer even if you only average 6K rent a year you will sitt have a return of well over 10% gross. This after costs will give you over 5% return on your money before long term capital apreciation.

You can write off expenses such as redecorating and if you live away from Killarney you will of cource need to inspect the property 4-6 times a year so allow for travel expenses to and from Killarney. There is no reason why if you buy a property to live in that you canot sell youself the furnishing in the rented property and refurnish it.:rolleyes:

Loads of legetimate ways to reduce tax burden.

jased10s

+ you will sell up at the end and make a tidy profit.

I know people say property has a bit to fall but get real people, you can currently get property for less than it costs to build. That's the trouble , their is no stability in this country. It seems it's either been way to expensive ( boom ) or way to cheap ( recession ). People need to stand back and think , rather than chasing the next big earner bandwagon that ultimately ends in a bust.

uberalles

Re > you can currently get property for less than it costs to build.

That depends on how many houses you are planning to build and the economies of scale. A one off build costs more than building 20 in one go. So that argument doesn't always wash.

jased10s

I was on about currently allready built properties and not 1 off self builds, which as you mention do cost more.

Farmer Pudsey

uberalles wrote: »

Re > you can currently get property for less than it costs to build.

That depends on how many houses you are planning to build and the economies of scale. A one off build costs more than building 20 in one go. So that argument doesn't always wash.

Even with building cost gone down. take ballyharpat apartment do you think that if you bought a site got planning and build 20 or 40 two bed apartments in the middle of Killarney you could afford to sell for less than 60K.

It is the same with some of the 3 bed semi for sale at present at around 100K it is hard to see them being build for less than that.

Villa05

Farmer Pudsey wrote: »

Even with building cost gone down. take ballyharpat apartment do you think that if you bought a site got planning and build 20 or 40 two bed apartments in the middle of Killarney you could afford to sell for less than 60K.

It is the same with some of the 3 bed semi for sale at present at around 100K it is hard to see them being build for less than that.

Ladies and Gentlemen - May i present the elephant

KERRY has the second highest number of vacant houses in the entire country with almost 20,000 empty houses in the county, according to the results of the 2011 census, which were published this week.

http://www.kerryman.ie/incoming/a-quarter-of-all-houses-are-empty-3070299.html

beeno67

Villa05 wrote: »

Ladies and Gentlemen - May i present the elephant


http://www.kerryman.ie/incoming/a-quarter-of-all-houses-are-empty-3070299.html

Kerry has the third highest number of properties currently for sale after Dublin & Cork. No way would I consider buying in Kerry.

ballyharpat

Villa05 wrote: »

Ladies and Gentlemen - May i present the elephant


http://www.kerryman.ie/incoming/a-quarter-of-all-houses-are-empty-3070299.html

That's a given, I can buy a five bedroom newly built house 12 miles outside of Killarney for about the same as I can buy an apartment. If I wanted one of those houses, it would be a great deal. As an investment, it is terrible, I would get about half the rent and a lot more overheads. If you look at areas like Killorglin/Firies/farranfore/Tralee/Ballyheigue, I could buy a lot cheaper. but my friends, it's all about location, location, location.Kerry is a big place, Killarney is a big town, with a lot of tourism jobs, a lot of people need to rent and do not make enough to pay rent and if there are a couple living in the house, they will both have to have cars.
Most of the houses for sale in Kerry are second homes, bought as holiday homes for people making 30k a year during the boom, that thought they could pay off their own house and a holiday home-living the dream-not!

In the town of Killarney, there are also plenty of 2 bed apartments for 100k+ that can be rented for maybe e100 per month more than what I am in the process of buying, again, as an investment, not a great return on them.

Has anyone gone on Daft and checked out two bedroom rentals in Killarney? or even one bed rentals in Killarney? ANd by Killarney, I mean Killarney 'town'?

Itchianus

Farmer Pudsey wrote: »

Loads of legitimate ways to reduce tax burden.

Are there though, with the emphasis on the legitimate? Apart from property incentive reliefs, which are being terminated next year, the only way you get a deduction is for an actual expense / wear & tear.

Farmer Pudsey wrote: »

You can write off expenses such as redecorating and if you live away from Killarney you will of cource need to inspect the property 4-6 times a year so allow for travel expenses to and from Killarney.

That's not a deductible expense.

Farmer Pudsey wrote: »

There is no reason why if you buy a property to live in that you canot sell youself the furnishing in the rented property and refurnish it.:rolleyes:

It's not clear to me what you're suggesting here - but either way you can't "sell yourself" anything you already own. You can buy / introduce 2nd hand assets but only at their current value, not their full cost.

Tea drinker

Itchianus wrote: »

Are there though, with the emphasis on the legitimate? Apart from property incentive reliefs, which are being terminated next year, the only way you get a deduction is for an actual expense / wear & tear.

That's not a deductible expense.

It's not clear to me what you're suggesting here - but either way you can't "sell yourself" anything you already own. You can buy / introduce 2nd hand assets but only at their current value, not their full cost.

If he has a company setup can he not vouch such expenses through it?
What if a family member is the director and he is employee?
That might be illegal in itself though.

ballyharpat

Not saying I would do this, but I know it is being done, some people may go ahead and buy new furniture for their own residence and even some decorating/renovating, they may then go ahead and say that the furniture/work is for their rental apartment, a terrible, terrible thing to do.....I mean they should really be paying tax on every cent, there should be no incentive to get ahead in Ireland, and especially through property ownership...

Farmer Pudsey

ballyharpat wrote: »

Not saying I would do this, but I know it is being done, some people may go ahead and buy new furniture for their own residence and even some decorating/renovating, they may then go ahead and say that the furniture/work is for their rental apartment, a terrible, terrible thing to do.....I mean they should really be paying tax on every cent, there should be no incentive to get ahead in Ireland, and especially through property ownership...

I agree entirely Ballyharpat who would do a thing like that buy 8K worth of new stuff and decorating for the house and get 1K a year (for eight years) wear and tear for the rental property. Worst still probally borrow the 8K over 4 years and write off the intrest against the rent.

that would be absoulatly awful thing to do.

it call tax evasion


Now Tax avoidance is another thing completely:rolleyes:

OMD

Farmer Pudsey wrote: »

I agree entirely Ballyharpat who would do a thing like that buy 8K worth of new stuff and decorating for the house and get 1K a year (for eight years) wear and tear for the rental property. Worst still probally borrow the 8K over 4 years and write off the intrest against the rent.

that would be absoulatly awful thing to do.

it call tax evasion


Now Tax avoidance is another thing completely:rolleyes:

You can write off anything you want against tax. The problem only arises when you have an audit, but boy do the problems arise then. Revenue are not stupid. They do not audit people and assume the person is being honest. They will not care if you try and say "I thought it was allowed". They will charge you the back tax, which is the least of your worries because they will also charge interest and most importantly they will charge penalties as well. But as I say it only matters if you are audited. As Clint might say "do you feel lucky punk?"