Affordable House - don't want it anymore.

OldNotWIse

podge018 wrote: »

I don't want any money, couldn't be further from the truth. Like I said I could be making a profit on the rent at the moment. I paid a £10,000 deposit, kitted out the shell of a property it was, have paid the mortgage for 8 years and I'm willing to hand it all back just to forget about it and write it off as a lesson learned.

You owe more than its worth, so how is "handing it all back" doing anyone a favour? You would essentially just be walking away from your debt.

The_Morrigan

I would appreciate if people would adhere to the charter and remain civil in here.

fricatus

podge018 wrote: »

Like I said I could be making a profit on the rent at the moment.

Well why don't you then? Not being smart, but this seems like the wisest course of action if what you say is true.

Contact a management company and tell them you want them to let it out for you. Ring around a few places as some give you a better deal than others.

I would go with one that takes a fixed percentage of the rent every month, rather than the first month's rent and then a percentage (as this acts as an incentive to bring in a string of short-term tenancies rather than one stable long-term one).

I understand not wanting to have to deal with the hassle, but this way, the only hassle is the tax return, and there's no avoiding that!

podge018

OldNotWIse wrote: »

You owe more than its worth, so how is "handing it all back" doing anyone a favour? You would essentially just be walking away from your debt.

People need housing.
The council haven't enough.
I don't need this one.
They sold it to me after paying €0 for it.
They are profiting from me on the back of a scheme designed to help people.
I know I am looking for a get out of jail free card, and I could go into how hard done by I am that they valued the place incorrectly and they shouldn't have given a small apartment to a young lad with his whole life ahead of him boo hoo etc etc, but I'm not, that was my decision and I've learned a lesson.

It would just seem to me to be advantageous to both parties for them to take the keys off me. I know it shounds simplistic and would be great if everyone in a spot of bother could do it, but it's not a bank I'm dealing with, they have no loyalty to shareholders. This was their badly run scheme.

The_Conductor

Guys- Podge018 asked a question- he did not invite your snide comments and abuse. If you don't have information to impart to him- please keep your opinions and sarcasm to a minimum.

Regards,

The_Conductor

Ray Palmer

ted1 wrote: »

Dublin city pay for my wifes tenant and collect the mortgage off my wife.

She had the house before we were married, they know its rented. they know that they are paying the rent. They know if she sold it she couldn't pay them back. They know that there is no alternative.

what has stamp duty go to do with it? that has being paid.

why would they check if an arrangement is in place?

The DSP pay RA after taking it over from the HSE. Neither are the Dublin city Council.

Stamp duty is different for investment properties so if you start renting within a set time stamp duty can and will be clawed back with fines if not declared.

A number of laws have been changed for RA and the tax office to communicate. There is a claw back clause for renting out a discounted property out. RA don't check if this is complied with at the moment. It can happen in the future.

Knowing and agreeing are not the same thing. An officer may know something but they may not inform the other organisation it doesn't mean you are correct or not liable. All I am saying is has this been checked.

Look at this way, a private LL buys a house and rents it out pays higher stamp duty and full price. Your wife paid less stamp duty and less for the house yet can rent it out for the same amount. That is a massive gain with penalties and punishment as that was not why the scheme was set up. Seeing as you can't even see why this is a problem I would certainly be checking compliance with all agreements. To me it sounds like your wife is liable for stamp duty and claw back on the discounted property.

They generally allow it if the person can't afford the property and has to move out. Not so keen on somebody buying a separate property and making a profit off the discount social housing. I am pretty sure you don't get out of this under 10 years.

Leroy42

podge018 wrote: »

People need housing.
The council haven't enough.
I don't need this one.
They sold it to me after paying €0 for it.
They are profiting from me on the back of a scheme designed to help people.
I know I am looking for a get out of jail free card, and I could go into how hard done by I am that they valued the place incorrectly and they shouldn't have given a small apartment to a young lad with his whole life ahead of him boo hoo etc etc, but I'm not, that was my decision and I've learned a lesson.

It would just seem to me to be advantageous to both parties for them to take the keys off me. I know it shounds simplistic and would be great if everyone in a spot of bother could do it, but it's not a bank I'm dealing with, they have no loyalty to shareholders. This was their badly run scheme.

You are right that people need housing
While the council haven't enough this is more to do with no having the resources to afford the houses rather than simply not wanting them
The council did pay for the house. Not directly but part of the planning system we had (if that is not too grand a term for it) was that a certain % of units had to be handed over for social housing. In effect, the rest of the residents have paid an extra cost so that you could have your house at an affordable price. Do you think the builder just gave it away?
They are not profitering at all. In effect they have taken on 50% of the cost. They are down €150k on the deal. If you stay in it long term you get to keep any sale proceeds. If anything you have been the beneficiary of this deal.
You asked them for the apartment, you entered into a legal agreement and you have enjoyed the benefits of that decision for the last 8 years. Exactly how are you hard done by? Anybody else buying the same apartment would now be in NE to the tune of 200K, you are in for roughly 30K. Sounds to me like you got a free gaff for 8 years, and then had 170k debt written off.

it would certainly be advantageous to you. You have to remember that the council have already paid in part for this property(while handing ownership to you) and now you want them to buy you out at an over the market rate. So going in to the deal you were happy for them to reduce the value of the apartment, but on leaving the deal you want them to increase it. WOuld you have been happy if the council wanted 400k for a 300k apartment?

Not sure how you can say the scheme was badly run. You provide no evidence of it. But regardless, what has the running of the scheme got to do with this? The scheme has worked for you and that should be all that matters to you.

ted1

Ray Palmer wrote: »

The DSP pay RA after taking it over from the HSE. Neither are the Dublin city Council.

Stamp duty is different for investment properties so if you start renting within a set time stamp duty can and will be clawed back with fines if not declared.

A number of laws have been changed for RA and the tax office to communicate. There is a claw back clause for renting out a discounted property out. RA don't check if this is complied with at the moment. It can happen in the future.

Knowing and agreeing are not the same thing. An officer may know something but they may not inform the other organisation it doesn't mean you are correct or not liable. All I am saying is has this been checked.

Look at this way, a private LL buys a house and rents it out pays higher stamp duty and full price. Your wife paid less stamp duty and less for the house yet can rent it out for the same amount. That is a massive gain with penalties and punishment as that was not why the scheme was set up. Seeing as you can't even see why this is a problem I would certainly be checking compliance with all agreements. To me it sounds like your wife is liable for stamp duty and claw back on the discounted property.

They generally allow it if the person can't afford the property and has to move out. Not so keen on somebody buying a separate property and making a profit off the discount social housing. I am pretty sure you don't get out of this under 10 years.

stamp duty is 1% for both investors and owner occupiers.

No one is talking about selling and making a profit.

My wife and i have recently being audited and are fully tax complaint, we even have piece of paper from revenue that says so. (they had being looking for 37k but ended up issuing a cheque)

DSP may have taking it over, but before they did Dublin City were issuing cheques.

Baby01032012

One of my "unnessary" questions I asked the OP remains unanswered- has the income earned been declared for tax purposes. It is bad enough that the OP thinks just because a council is allowing certain people with adorable housing to let out their houses that it is ok not to seek permission. And the idea that 300k was a notional value.. I wonder how the other 90% that paid the full asking price feel about that

Peterx

The full market value aspect is complicated by the fact that the affordable apartments were not fitted out to the same standard as the ones sold on the open market.
In fact they were not fitted out at all in some cases.

The scheme was a well meaning one on the government's part which was badly executed by councils who were bullied by developers who despised it and here we have the results.

On a wider planning point, no planning authority should have allowed one bed apartments be available to anyone bar student accommodation and elderly sheltered+supported accommodation.
As to the OP's situation, the response from your fellow AH seems to be the approach. Tell the council, get agreement to rent it, become tax and PRTB compliant and carry on.

superleedsdub

podge018 wrote: »

thanks for your reply superleedsdub, I know I'm going to have to say it to them, but I also know they're allowing it now so what are they going to do if they check with the PRTB? Force me to move back in.

One thing the council could do is check with revenue to see if you are still claiming back mortgage interest relief on the property and if you paid the NPPR.
If you are fully compliant to date with Revenue, then the council may be bothered taking further action. I`m not sure what your tax situation is regarding the property (none of my business :-) ) but in my opinion it is very beneficial for anyone in this situation to declare your income on the property and deduct ALL the expenses that revenue allow.

Ray Palmer

ted1 wrote: »

stamp duty is 1% for both investors and owner occupiers.

No one is talking about selling and making a profit.

My wife and i have recently being audited and are fully tax complaint, we even have piece of paper from revenue that says so. (they had being looking for 37k but ended up issuing a cheque)

DSP may have taking it over, but before they did Dublin City were issuing cheques.

1% now not then, they can claw back the stamp duty that should have been paid. The profit has and is in the rent. Profit it or not you weren't meant to rent the property out ever. Allowances were made for those in distress and you and your wife would not qualify.

Dublin city council do not issue the cheques and never have. It was the HSE before DSP.

I doubt you have a tax compliance cert based on what you have being saying as you are still unaware of the system.

Even if you take all the money out of it and the regulation do you not see how you did not enter into the spirit of the agreement. Certainly not entering into the spirit of what it was for.

podge018

Baby01032012 wrote: »

One of my "unnessary" questions I asked the OP remains unanswered- has the income earned been declared for tax purposes. It is bad enough that the OP thinks just because a council is allowing certain people with adorable housing to let out their houses that it is ok not to seek permission. And the idea that 300k was a notional value.. I wonder how the other 90% that paid the full asking price feel about that

It was answered. Yes. Can you answer me now, what does it matter to the issue at hand?

ted1

Ray Palmer wrote: »

1% now not then, they can claw back the stamp duty that should have been paid. The profit has and is in the rent. Profit it or not you weren't meant to rent the property out ever. Allowances were made for those in distress and you and your wife would not qualify.

Dublin city council do not issue the cheques and never have. It was the HSE before DSP.

I doubt you have a tax compliance cert based on what you have being saying as you are still unaware of the system.

Even if you take all the money out of it and the regulation do you not see how you did not enter into the spirit of the agreement. Certainly not entering into the spirit of what it was for.

you can talk about the spirit all you want, but you don't seem to have actual working knowledge of the scheme.


Here are the facts.

The scheme enabled those on low incomes to purchase homes.
being low income would generally apply that the participants weren't the brightest or were young and naive.
the apartments and houses on offer were mostly 1 and 2 bedrooms, they also were the smaller ones in each block, the runt of the litter one might say.

The council selling a 1 or 2 bed is not in the spirit of the scheme as its meant to be a a "home"

people were entered into 20 year contracts, but yet the application was based on their current situation. So what 3 beds that were on the scheme were not offered to single people.

these single people have since had kids got married and often the partner may have their own property, so there is no need for the existing one that no longer meet the needs of the family to be a home.

now due to the fact that the market has nose dived there is no way for the shoe box to be sold, so either its rented out and the mortgage is paid or its left empty and the mortgage is not paid.


And tell me this do yo work for revenue or are you tax specialist? because I can guarantee you that myself and my wife are 100% tax complaint as per recent audit.

trinewbie

Peterx wrote: »

The full market value aspect is complicated by the fact that the affordable apartments were not fitted out to the same standard as the ones sold on the open market.
In fact they were not fitted out at all in some cases.

The scheme was a well meaning one on the government's part which was badly executed by councils who were bullied by developers who despised it and here we have the results.

On a wider planning point, no planning authority should have allowed one bed apartments be available to anyone bar student accommodation and elderly sheltered+supported accommodation.
As to the OP's situation, the response from your fellow AH seems to be the approach. Tell the council, get agreement to rent it, become tax and PRTB compliant and carry on.

Some were kitted out to the exact same spec as those sold on the open market. Myself and partner purchased apartment in Ballintyre through the affordable housing scheme in 2008, at a purchase price of e275K which was the same finish spec as those sold at e460k+ on the open market. The developers used the AH scheme to get rid of units which were less desirable to the open market, north facing, ground floor, fronting out onto carparks etc.

We recently sold the apartment as we are planning on starting a family and need more room than that offered by a two bed apartment. Despite the fact we purchased at 275k, we were still in a significant amount of negative equity. We were lucky to be in the position to sell, use savings to clear the negative equity and draw a line under it and move on. We lost around 50k on this venture, but a 50k hit is a whole lot more palatable than the 230K plus that we would have had to take if we had purchased at an open market rate initially.

I genuinely feel sorry for good friends who purchased in the same block of apartments as us at the open market price, friends who are now looking to start families and need space, but are trapped due to the massive negative equity they are in. They don’t have the option of handing the keys back and walking away from their debt just because they don’t want the place anymore.
OP, if you have had the initiative to save up a lump sum to purchase a new house, why not do the same again to clear any NE that you might be left in after sale of the apartment?

AlekSmart

trinewbie wrote: »

.

I genuinely feel sorry for good friends who purchased in the same block of apartments as us at the open market price, friends who are now looking to start families and need space, but are trapped due to the massive negative equity they are in. They don’t have the option of handing the keys back and walking away from their debt just because they don’t want the place anymore.
OP, if you have had the initiative to save up a lump sum to purchase a new house, why not do the same again to clear any NE that you might be left in after sale of the apartment?

Agreed trinewbie,and that still gets me wondering what do such people do in the rest of Europe...what specific elements in Mainland European Social Systems has allowed,and continues to allow,Family life to prosper without a profusion of 3-Bed Semi-D's ?

This thread is a real eye-opener in so many ways...:)

The_Conductor

AlekSmart wrote: »

what specific elements in Mainland European Social Systems has allowed,and continues to allow,Family life to prosper without a profusion of 3-Bed Semi-D's ?

That would be- people predominantly rent.
Accommodation is predominantly apartments.
An average 2 bed apartment in France or Germany is over 60% bigger than an average Irish 2 bed apartment.
In France or Germany- facilities and amenities are provided for those with young families- such as playgrounds on-site for children, good public transport, access to local schools (I could go on and on)

In Ireland we allowed silly building regulations that allowed the building of a multitude of tiny inappropriate apartments, in areas where people don't want to live- with population densities such that it is uneconomic to provide reasonable public services. We have every little village playing parochial politics with the next village over, each county competing with every other county- and the rest of the country against Dublin. The whole Irish psyche is structured in such a way that we are ungovernable, no-one thinks of the bigger picture- what is good for Ireland as a whole- and parish pump politics rules supreme.

Until such time as the political system is dismantled, so there is no 'our man in Leinster House' attitude- we're screwed.

OldNotWIse

The_Conductor wrote: »

That would be- people predominantly rent.
Accommodation is predominantly apartments.
An average 2 bed apartment in France or Germany is over 60% bigger than an average Irish 2 bed apartment.
In France or Germany- facilities and amenities are provided for those with young families- such as playgrounds on-site for children, good public transport, access to local schools (I could go on and on)

In Ireland we allowed silly building regulations that allowed the building of a multitude of tiny inappropriate apartments, in areas where people don't want to live- with population densities such that it is uneconomic to provide reasonable public services. We have every little village playing parochial politics with the next village over, each county competing with every other county- and the rest of the country against Dublin. The whole Irish psyche is structured in such a way that we are ungovernable, no-one thinks of the bigger picture- what is good for Ireland as a whole- and parish pump politics rules supreme.

Until such time as the political system is dismantled, so there is no 'our man in Leinster House' attitude- we're screwed.

I was in Brazil with the OH a while back. The famiy have an apartment. Seemed normal enough going in, but when you actually got in, like you said, it was huge. No boxrooms or galley kitchens or tiny bathrooms where you couldn't swing a cat. What really impressed me was they have a communal living area downstairs with a large indoor and outdoor recreation area with kitchen, barbeque area, pool, play area for the kids etc that can be booked by residents for use in advance for parties, bbq's etc. Pretty impressive but normal apparently. Then again, they pay huge maintenance fees, which is something we dont pay here.

Rachiee

Wait til you are in there the ten years then you don't have to pay any money back to the council upon selling, yes you have the hassle of renting it out for the next few years but it will make the selling a lot less complicated when you don't have to contend with the clawback. Pretty sure you are not supposed to be renting those places out but as has been mentioned the scheme is no longer in operation so its probably nothing to worry about.

gazzer

kitten_k wrote: »

i got my home through the affordable housing scheme too (mortgage with a bank). As far as I am aware I am not allowed to rent it to anybody else and if I sell up before a certain amount of time I need to pay a percentage to Dublin City Council.

I think you only pay a percentage back if a profit is made. e .g if you bought the house from the council for €150,000 and sold it for €200,000 the council get some of the profit but if you sell for €100,000 (if that is the market value) then you dont have to give the council any money

gazzer

Rachiee wrote: »

Wait til you are in there the ten years then you don't have to pay any money back to the council upon selling, yes you have the hassle of renting it out for the next few years but it will make the selling a lot less complicated when you don't have to contend with the clawback. Pretty sure you are not supposed to be renting those places out but as has been mentioned the scheme is no longer in operation so its probably nothing to worry about.

Fingal Council allow you to rent the house/apartment out. Dublin City Council are very wishy washy on it. There is a whole "Dont tell us if you are renting out your property and as long as you pay your mortage we wont say anything" attitude

Ray Palmer

Apartments being bigger in Europe is something I find very hard to believe given what I have seen. Paris, 2 friends lived in apartments and they were tiny. Would not be allowed to rent them here. Their hotel rooms are incredibly small too so I find claims they are bigger at odds with anything I have seen.
Italy, Spain, Portugal apartments I have seen are very very small.
I have only seen former East German apartments and they were very small also. What ever figures quoted I have seen for apartment sizes seem to be about recent builds. That is to say they are building bigger apartments now but that doesn't eliminate all the others that already exist that are the majority. Apartments built in Ireland were to catch up with the lack of housing for single people and couples with no kids.
It is comparing apples and oranges and ignoring the actual differences in overall housing stock. Until apartments were built in mass numbers the majority of single people had to house share. That adjustment needed to be made. Due to the property crash people are afraid of apartments. They were a needed addition to the Irish property market. Unfortunately due to them loosing value people can't move out of them making it look like apartments aren't suitable for families but they weren't designed to be in the first place in any realistic way.

trinewbie

Rachiee wrote: »

Wait til you are in there the ten years then you don't have to pay any money back to the council upon selling, yes you have the hassle of renting it out for the next few years but it will make the selling a lot less complicated when you don't have to contend with the clawback. Pretty sure you are not supposed to be renting those places out but as has been mentioned the scheme is no longer in operation so its probably nothing to worry about.

As gazzer says, there is no clawback in a negative equity scenario. If not a NE scenario then after ten years any clawback is reduced by 10% per annum until year 20, after which there is no clawback.

Tangatagamadda Chaddabinga Bonga Bungo

gazzer wrote: »

Fingal Council allow you to rent the house/apartment out. Dublin City Council are very wishy washy on it. There is a whole "Dont tell us if you are renting out your property and as long as you pay your mortage we wont say anything" attitude

Why that sounds like an Irish solution to an Irish problem right there.

Peterx

trinewbie wrote: »

Some were kitted out to the exact same spec as those sold on the open market. Myself and partner purchased apartment in Ballintyre through the affordable housing scheme in 2008, at a purchase price of e275K which was the same finish spec as those sold at e460k+ on the open market. The developers used the AH scheme to get rid of units which were less desirable to the open market, north facing, ground floor, fronting out onto carparks etc.

We recently sold the apartment as we are planning on starting a family and need more room than that offered by a two bed apartment. Despite the fact we purchased at 275k, we were still in a significant amount of negative equity. We were lucky to be in the position to sell, use savings to clear the negative equity and draw a line under it and move on. We lost around 50k on this venture, but a 50k hit is a whole lot more palatable than the 230K plus that we would have had to take if we had purchased at an open market rate initially.

I genuinely feel sorry for good friends who purchased in the same block of apartments as us at the open market price, friends who are now looking to start families and need space, but are trapped due to the massive negative equity they are in. They don’t have the option of handing the keys back and walking away from their debt just because they don’t want the place anymore.
OP, if you have had the initiative to save up a lump sum to purchase a new house, why not do the same again to clear any NE that you might be left in after sale of the apartment?

Trinewbie, best of luck with all the plans and very well done on getting a fully fitted/kitted AHS apartment.
My experiences in different AH apartments was they were unfitted and the person showing me around had the attitude that I would take what I was offered and it would be good enough for me.
SDCC tried to sell 2 bed apartments in the heart of Tallaght on the "affordable" housing scheme for 280k. No wonder it was closed down.

orionm_73

gazzer wrote: »

Fingal Council allow you to rent the house/apartment out. Dublin City Council are very wishy washy on it. There is a whole "Dont tell us if you are renting out your property and as long as you pay your mortage we wont say anything" attitude

AFAIK FCC allow you to rent as long as you get their permission and they also freeze the clawback while the house/apartment is rented out. So if you rented it out for 2 years, the clawback would be in place for 22 yrs.

bigblackmug

Podge018, you signed up for affordable housing. Fingal Co. Co. made it very clear what your obligations were. You had plenty of time to take legal advice.
Fingal Co. Co. don't hold your mortgage. Housing Finance Agency hold your mortgage.
You would have seen the notional market price on your property was overstated but you still proceeded with purchase.
Continue to pay your mortgage or else sell it and take your negative equity. Don't look for a bailout from the rest of society and a bailout is exactly what you are looking for if you want the Council to take over your apartment because they'll have to cear the balance of the mortgage with the HFA.

I speak as someone who bought an affordable housing apartment from Fingal with an overstated market price and sold it after the crash wiping out the years of mortgage payments I made.

You did get something out of this so I can't see how you are feeling so hard done by; you didn't have to pay even higher rental price per month than the price of your mortgage and you weren't forced in to accommodation sharing with strangers.

I'm not going to add further to this thread because it is obvious that you don't understand the affordable housing scheme and didn't do your due diligence when signing up for the largest purchase of your life thus far.

BTW don't plan on upside as if the market price rises(unlikely) above 150k the Council will be taking 50% of every additional euro on sale price.

Victor

podge018 wrote: »

nice one smartarse.

No name calling.

Moderator

Dandelion6

ted1 wrote: »

people were entered into 20 year contracts, but yet the application was based on their current situation. So what 3 beds that were on the scheme were not offered to single people.

Minor amendment, the ones that were done by lottery were based purely on ability to meet the monthly mortgage payment, whatever the size. You just ticked the options that you felt you could afford and if your name came out of the hat they just checked your income not your family size.

podge018

bigblackmug wrote: »

You did get something out of this so I can't see how you are feeling so hard done by; you didn't have to pay even higher rental price per month than the price of your mortgage and you weren't forced in to accommodation sharing with strangers.

I don't feel hard done by, I explicitly stated this. I used a sentence previously in the thread of what I could go to them whinging about but it's not me or how I feel. I said "that it was my decision and I've learned a lesson".

bigblackmug wrote: »

I'm not going to add further to this thread because it is obvious that you don't understand the affordable housing scheme and didn't do your due diligence when signing up for the largest purchase of your life thus far.

I understand it very well thanks but there's no need to add anything further because I can tell you're hurting bad over the loss you took and your input so far reeks of sour grapes.

bigblackmug wrote: »

BTW don't plan on upside as if the market price rises(unlikely) above 150k the Council will be taking 50% of every additional euro on sale price.

And I'll get the other 50%, that's an upside. Don't worry, I'll sell it long before then, as soon as the market price is nearer what I owe, which isn't too far away actually as both figures continue to move in opposite directions.