Property Market 2017

VonBeanie

Villa05 wrote: »

What exactly is wrong with it.

It has been all carrot up to now. It's time to get out the stick when the carrot has not been working.

Some people may pay the tax others may choose to build or sell, that's there choice.

I can't think of no fairer tax than a tax on an under utilised asset.

For me, I think the biggest problem with the vacant land tax is it may incentivise the waiving of planning permission on some land to avoid the tax, which may slow down new building coming on stream. I think its also hard to figure out what land the tax should be levied on - only inside RPZs (or do you want to incentivise building where people don't want to live), land with planning permission, or serviced land, land for multiple properties or single house plots?

Villa05

VonBeanie wrote:

For me, I think the biggest problem with the vacant land tax is it may incentivise the waiving of planning permission on some land to avoid the tax, which may slow down new building coming on stream. I think its also hard to figure out what land the tax should be levied on - only inside RPZs (or do you want to incentivise building where people don't want to live), land with planning permission, or serviced land, land for multiple properties or single house plots?

Land owners won't want t waive planning permission as it will devalue their asset

Tax should be localised to areas where there is a shortage. RPZ is probably the best way of achieving that.

How is the bedroom tax applied in the UK is it nationwide or localised

jamesthepeach

LirW wrote: »

What about vacant land that might not be suitable for building or it's hard to get planning permission? Or people that own places that are derelict because they inherited them? Rural sites that are sitting on the market and just don't sell?
A lot of sites that could be used for building are around for ages because you'll only get permission to build when you have ties to the area, build in a certain style or whatnot.

Exactly, not to mention trying to find builders should they all get planning permission all of a sudden. Not a hope if it working.

mel123

Zenify wrote: »

I can't see why people aren't suggesting a vacant land tax?

All the government have to do is mention it and everyone will try sell their land and it will bring a lot of land onto the market, thus reducing the price for builders to purchase it.

if the government announced in budget 2018 that vacant land will be taxed from 2019 at 2% 2020 at 3% 2021 at 4%. Everyone housing land will sell. I honestly see this as the best solution.

Does anyone have any thoughts on this?

I agree with you and i dont. Like why should joe soap be forced to sell their vacant land? An incentive maybe rather than a mandatory tax would be better IMO.

There are so many things our greedy government could do, yet every bloody suggestion is passing the buck down to the ordinary joe soap whos working hard and paying taxes.

Cuddlesworth

jamesthepeach wrote: »

Vacant land tax is not the saviour everyone thinks it is. Think about it. Are you going to tax everyone in the country try that has vacant land. No way are they all going to be building on them at the same time. Just not possible. And that's just one issue with it. But hell with them. Tax them. Sure that's the answer to everything.

The government don't actually want the building rate everyone else is expecting they do. Sure way to a property crash.

Its too open to corruption with our parish politics system. You have to tax all land, regardless of use.

jamesthepeach wrote: »

Not to mention that if anyone actually knows an elderly person who is unfortunate enough to end up in a nursing home, they hold out the hope, however slight, that they will someday be allowed back to their house. Yes, the house that they spent their blood, sweat and tears, over more years than most people suggesting this have been alive, to aquire and to maintain it.

And sometimes they can get out for a day and be brought to visit THEIR home and it brightens up their day so much.

Also family who are home to visit them in the nursing home.e can stay in the house. It makes it easier arranging time from family who might be abroad and want to come back and help etc.

Government are now targeting the elderly big time. Sure they are just dying to up the retirement age again already.

I tell ya, if the government even go near pulling the trigger on this one they will not only lose they pensioners or near pensioners votes, they will also lose the vote of anyone else over 40, which seems to be the magic age at which people realize that one they they will actually be old. Before that age people seem to think they will be you forever.

The fair deal is hugely in favour of the elderly. It lets them get massively subsidised state care in their old age til their death which could possibly, and usually does, cost them far more then they are worth.

To put this in perspective, it costs around 1000 a week on average for a nursing home. That's 52k a year plus additional healthcare costs, medication, doctors visits etc. 10 years in a home would wipe most old peoples wealth to zero.

The fair deal plan was set up to allow them to keep some money and not strip the family home and inheritance from the kids. The reality is, in the last two decades it has motivated the elderly to leave the houses empty for the duration of their stay. I've lived beside 4 in the last 10 years in Dublin.

To say that the elderly are being unjustly targeted in one of the most social schemes I have ever seen is pure hyperbole. And to say that being provided heavily state subsidised health card for the elderly while asking them to sell(without stripping the value of the home from them) would be unfair because they are attached to the house is ridiculous. The country is in a housing shortage and the country is the one paying for their health care.

myshirt

To be fair, if you have a decent pension you get taxed 50% on it. You then pay 80% of the remainder towards your care. If you take your standard Garda on a reasonable pension of 1,000 a week since they were 55, and they are now 81, that leaves them with 100 quid.

That's a big change for a person.

draiochtanois

This post has been deleted.

jamesthepeach

Here's a radical idea. Let's put a levy of 2% on income across the board. Call it USC 2.
So everybody pays 2%. Even those on the file pay 2% of their dole. Those on rent allowance pay 2% of their rent allowance.
Those earning millions pay 2% on their millions.
Politicians pay 2% of their salary. Ex politicians pay 2% on their pensions.
Investors pay 2% of their profits.
2 % on everything.
It's nothing new, been done loads of times. Just the people benefitting from it have to pay it too this time.

Then as that money builds up, which would be pretty fast , we buy a lump of land a nice distance out from the city where it's cheap and build a heap of houses on it. These houses are then rented to anyone who is homeless for 10% of their income on a yearly contract. Any messing and you are out forever. You cant blame others for you being homeless anymore if you get kicked out, just yourself to blame.

Then you buy another lump of land and do the same again with the next chunk of money. You keep doing this til the homeless problem is solved. Then you stop taking the 2%.

Also anyone living in an RPZ has to pay property tax. Im talking about the people living their, not their landlords. You live in an in demand area you pay higher tax.
Much like property in the UK.

Oops. Big problem with that plan isn't their. One, it's more tax. Two, it's not considered fair because the people benefitting from it would have to pay it too.

Oh well, back to the drawing board.
Let's hit the oldies on the fair deal scheme because, god forbid, it might actually be fair as it it and we can't have that.

pilly

jamesthepeach wrote: »

Here's a radical idea. Let's put a levy of 2% on income across the board. Call it USC 2.
So everybody pays 2%. Even those on the file pay 2% of their dole. Those on rent allowance pay 2% of their rent allowance.
Those earning millions pay 2% on their millions.
Politicians pay 2% of their salary. Ex politicians pay 2% on their pensions.
Investors pay 2% of their profits.
2 % on everything.
It's nothing new, been done loads of times. Just the people benefitting from it have to pay it too this time.

Then as that money builds up, which would be pretty fast , we buy a lump of land a nice distance out from the city where it's cheap and build a heap of houses on it. These houses are then rented to anyone who is homeless for 10% of their income on a yearly contract. Any messing and you are out forever. You cant blame others for you being homeless anymore if you get kicked out, just yourself to blame.

Then you buy another lump of land and do the same again with the next chunk of money. You keep doing this til the homeless problem is solved. Then you stop taking the 2%.

Also anyone living in an RPZ has to pay property tax. Im talking about the people living their, not their landlords. You live in an in demand area you pay higher tax.
Much like property in the UK.

Oops. Big problem with that plan isn't their. One, it's more tax. Two, it's not considered fair because the people benefitting from it would have to pay it too.

Oh well, back to the drawing board.
Let's hit the oldies on the fair deal scheme because, god forbid, it might actually be fair as it it and we can't have that.

All sounds great except for the government has lost the expertise to build.

They're completely reliant now on the private sector and the private sector is just not interested.

I'm really not sure how it came about that some knob in an office thought "I know, we'll stop building council houses in the middle of a boom".

I don't pretend to have an answer either but I agree with your premise that the ONLY way out of this crisis is to build en masse and quickly, they did it in the 80's, they could do it again. They're too busy thinking about it to actually take action. It really makes me angry.

People will jump in with this "you can't house all council tenants in the same place" but we can't house them all in hotels either. It's the lesser of two evils. I know I'd prefer a house anywhere to a hotel room.

Also, in reality the majority who are getting off the homeless list now are doing so through housing organisations who do indeed build all their houses together. Strangely enough I haven't heard any huge problems with these developments.

LirW

I doubt that this would work out, even though the idea isn't bad because people want to live in Dublin, Cork, Galway and some extreme examples make themselves homeless on purpose (ie moving out of accommodation in rural areas) to be housed in the cities. Wasn't there this wonderful lady that abandoned her house in Clare to sleep outside of a cemetery with kids in the car?

I genuinely can't understand why people get through with this and can turn houses down because they aren't in the preferred part of the city.

The_Conductor

myshirt wrote: »

To be fair, if you have a decent pension you get taxed 50% on it. You then pay 80% of the remainder towards your care. If you take your standard Garda on a reasonable pension of 1,000 a week since they were 55, and they are now 81, that leaves them with 100 quid.

That's a big change for a person.

An average Garda pension is 32k- not 52k........

pilly

LirW wrote: »

I doubt that this would work out, even though the idea isn't bad because people want to live in Dublin, Cork, Galway and some extreme examples make themselves homeless on purpose (ie moving out of accommodation in rural areas) to be housed in the cities. Wasn't there this wonderful lady that abandoned her house in Clare to sleep outside of a cemetery with kids in the car?

I genuinely can't understand why people get through with this and can turn houses down because they aren't in the preferred part of the city.

Worked in the 80's when it was either move to such a place, buy your own place or live with your parents. No other options, no hotel accommodation.

LirW

One would say it's the most rational approach really.
A few months back I've heard a homeless lady on the radio talking that she wants to be in Finglas close to her family, she wouldn't want to take another place. I find this so bizarre. You get housed for the fraction of the price you'd normally pay and Dublin is a stamp really, so it's not taking you hours to see your family.
Is this just delusional or is this real that people turn houses down for that very reason?

Villa05

mel123 wrote:

I agree with you and i dont. Like why should joe soap be forced to sell their vacant land? An incentive maybe rather than a mandatory tax would be better IMO.

mel123 wrote:

There are so many things our greedy government could do, yet every bloody suggestion is passing the buck down to the ordinary joe soap whos working hard and paying taxes.

You are not forced to sell, There is a cost associated with under utilising an asset, a tax places some of the cost on the person's responsible.

It would be a tax for the greater good a tax on waste so to speak. Ordinary joe soaps paying taxes are suffering most as many of them have to pay much higher rents because residential units are not being built on zoned land

greensheep777

I would be disgusted if the elderly were in some way taxed or otherwise beaten with a stick to make them rent out or sell their house.

They paid a mortgage, along with interest, on that house for all those years, and now they finally own it, the Government want to tell them what to do with it?
I've been hit by the shortage of housing as much as everyone else, but this isn't the answer.

Build more homes, make them affordable, and build higher. There's too much consideration being given to the poxy skyline and not enough to the fact we don't have enough homes, they're not affordable enough, and people are having to take long commutes in their car every morning because the only place they could afford was miles from where they work and public transport isn't good enough. We need to move with the times and build up like every other modern Western country.

The_Conductor

How about excluding the first 14k of rental income for a landlord from tax (akin to the 14k you can earn on the rent-a-room scheme)- and afford this 14k allowance to all landlords- incl. of the elderly- with the sole proviso they need to appoint an agent to manage their property and tenancy (as presumably if they need nursing home care- they're not hale and hearty and capable of dealing with issues as they arise for tenants).

?

The Minister has already signalled he intends to ease the burden on accidental landlords and those with 1-2 properties- wouldn't it be nice and neat and tidy- to try and roll all of these in together- using the rent-a-room scheme as a yardstick?

If a landlord earns over 14k per annum- let them pay tax, at their marginal rate, on the excess over the 14k- akin to what they're currently doing.

Note- you have to keep allowances and costs though- to ensure properties receive the upkeep they need (the Germans factor this in- with a 2% of the open market value of the property allowed as an allowance for property upkeep per annum- which is another way this could be dealt with).

The cost of a nursing home place on the Fair Deal scheme- to the exchequer- is, on average 64k per annum (in 2016). Any contribution towards this by the person availing of the scheme- is a gesture- regardless of what it ends up being. The maximum a person pays- is capped at 22.5% of the value of the PPR (+ up to 90% of their net cash flow)- regardless of how long they live in the nursing home and avail of its facilities.

People have this whole notion- we need to help out pensioners, we need to dig out those on low wages, we need free childcare, we need lower taxes on employees, we need- a long and bewildering wish list. The simple and irrefutable fact is- someone, somewhere, has to pay for all of these things. With respect of our retired population- its going to increase by 50% by 2026- and a further 25% by 2035. The dependency ratio is already in freefall from 6:1- to below 4:1 by 2020- and worsening as time progresses. I.e. there will be a shrinking pool of gainfully employed workers expected to pay for all manner of largess for pensioners, the elderly, the infirm, the young etc etc This increasingly stretched cohort- are never going to have access to any of the services, facilities and amenities- that do-gooders are prescribing as a god-given right for the people of today.

We need to be fair and reasonable- both to todays pensioners- but also to those who are expected to pay for it.

Just a thought..........

Villa05

greensheep777 wrote:

I would be disgusted if the elderly were in some way taxed or otherwise beaten with a stick to make them rent out or sell their house.

I have 2 close relations who sold because of the bedroom tax in UK. They are both delighted with the improvement in their quality of life since they made the decision

Cash lump sum and reduced outgoings on a smaller property.

We are a society not a group of individual interests

qrx

How long does a person spend in a nursing home on average? 5 years? All seems a bit pointless, it'll be on the market soon enough by the time they are in a nursing home.

LirW

It seems most people don't spend more than 2 years in a nursing home with a good amount not even making 1 year.

I said it yesterday somewhere, I'm just thinking of the practicalities of it: A lot of houses of elderly people need serious refurbishment, redecoration and repair to be fit enough to rent it out. Who's going to finance it? Especially when the family genuinely can't fork that money out.

quadrifoglio verde

qrx wrote: »

How long does a person spend in a nursing home on average? 5 years? All seems a bit pointless, it'll be on the market soon enough by the time they are in a nursing home.

It's something that a few commentators noted recently and it's true.
We've got a number of empty houses sitting empty because their owners are in a nursing home. They're sitting empty primarily because there's no incentive to rent them out.

Afterall, why would you? If you're getting 1030 a month from your pension and seeing 200 of it, you/your son/daughter are not going to rent out your beloved family home so that you can have an extra 200 euro a month.
It just isn't worth doing.
So the home stays empty. It falls into a state of neglect and disrepair and the family discovers how bad it is the morning before the wake.

The only way I can see something like this working is if the rental income earned and handed over to the state under fair deal scheme is later given as an income tax credit for the inheritants.
Then perhaps it might provide the incentive to rent these houses out.
I'd wager a tenner that there's at least 1000 empty family homes in the Dublin area because the owner is in a nursing home. 1000 homes on the rental market would give a much needed boost. It's just finding a way to get them on there.

The other thing that needs to be done is a reassessment of every current local authority tenancy.
People who needed a 3 bedroom house ten years ago may no longer need that house. A family of four might now be just a husband and wife and perhaps a one bedroom flat is more suitable to their housing needs?

Taylor365

The_Conductor wrote: »

If a landlord earns over 14k per annum- let them pay tax, at their marginal rate, on the excess over the 14k- akin to what they're currently doing.

Is the rent-a-room scheme not, pay tax on everything if you go over 14k?

VonBeanie

Taylor365 wrote: »

Is the rent-a-room scheme not, pay tax on everything if you go over 14k?

That's how I understand it. Earn 14,001 and pay full tax on the full amount.

The_Conductor

Taylor365 wrote: »

Is the rent-a-room scheme not, pay tax on everything if you go over 14k?

Yes- and while I understand where they were coming from- for a person's PPR or sole property- I would argue that this stipulation be removed- and it broadened out so if someone is renting a sole property- perhaps even remove the PPR stipulation- and coral accidental landlords into the same group.

The Minister is making all sorts of wild assumptions though- the simple fact is- of the 160,000 (or whatever the number is) vacant properties nationally- only a very very small subset of these- are in locations where people want to live.

The other aspect of all of this- is many elderly in nursing homes- may not be legally considered to be cognis mentis- why is the Minister assuming that if they are senile to the extent that they need full time nursing home care, that they are capable of being landlords............

This whole crackpot set of assumptions- just sounds worse and worse, the more I think about it.

The bigger problem- than any other- is a chronic lack of supply- where people actually want to live (our major urban centres). No matter how you look at this- its only going to unlock a small number of suitable properties- and even then- there is an assumption that the owner will be willing to let the property at all.

Age Action Ireland- are implying that if you allow the person keep the rental income- that this 'carrot' will mean a large number of elderly will happily rent out their properties. Well- I think they're just plain wrong. I have a long list of elderly relatives- none of whom would be happy to let our their family homes- rent bedamned (to say nothing of the fact that I'd be staggered if a single property met current council requirements for HAP and/or other schemes- without significant refurbishment- in general- home owners live in properties which do not meet current council/LA requirements).

If the Minister were serious- he would come up with some sort of scheme to encourage the elderly who are no longer living in the family home- to sell the family home- and the buyer could update it/retrofit it as necessary.

Its not going to work...........

draiochtanois

This post has been deleted.

Uriel.

A better approach is to allow the older person sell the family home and cap the proceeds from the sale of the home the same way as the home itself is treated under fair deal i.e. Transfer the cap of 3 years to the cash from the sale also. That might encourage people to sell.

But you still run into all of the sentimental and legal issues, including as has been mentioned previously, the fact that many older people in nursing homes will maintain a hope to return to their home someday, permanently or for visits etc.

Either way as pointed out on the thread if the average length of time for a person in a nursing home is around 2 years,its not as if these homes are being indefinitely tied up in a vacant state. You wouldn't be long seeing those 2 years pass while dealing with the exceptionally life changing experience of going into long term nursing care etc.

Villa05

draiochtanois wrote:

This post has been deleted.

Is this not normal in the rental market

Baby01032012

Revealed: Top banker's €2.8m mortgage costs him just €1,400 a month

Sorry when I pasted it it doesn't paste as a link.

So the deputy chairman of the bank of Ireland paid €1400 interest a month on a €2.8m mortgage, interest only.

It's really the following paragraph that I find amusing. If that's on same terms as any other mortgage can I have €2.8m also?

That would be some central bank exemption

All loans to directors are made in the ordinary course of business on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with other persons and do not involve more than the normal risk of collectability or present other unfavourable features."

Michael D Not Higgins

http://www.independent.ie/business/irish/revealed-top-bankers-28m-mortgage-costs-him-just-1400-a-month-36043097.html

Some funny stuff going on but he did pay a significant chunk of principal in 2012 and 2013.

Bob24

Baby01032012 wrote: »

Revealed: Top banker's €2.8m mortgage costs him just €1,400 a month

Sorry when I pasted it it doesn't paste as a link.

So the deputy chairman of the bank of Ireland paid €1400 interest a month on a €2.8m mortgage, interest only.

It's really the following paragraph that I find amusing. If that's on same terms as any other mortgage can I have €2.8m also?

That would be some central bank exemption

All loans to directors are made in the ordinary course of business on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with other persons and do not involve more than the normal risk of collectability or present other unfavourable features."

Like many others in the country he probably got a deal for interest only arguing he can't pay anymore and the bank chose that rather than an attempted repossession as it is easier for them (and in that case the fact that he is a senior employee makes repossession even more of a problem from them). The amounts are just pretty high but from what I can see on the Indo article unless there he a subsequent write-off he will have to resume much higher repayments again in the future to reduce that 2.8m principle.

So there could be agreements between "friends" at the top to wipe-off some of the principle in the future, but at this stage aside from giving him a break on repayments they haven't gifted him money .

Henbabani

i'm still can't see the rents going much further, they aren't cheap now but when i looked in daft, i see some 1Bdr for 1400-1500 waiting more than two weeks and they are in D1, even 2BDR in D9 for 1400 online for more than 3 weeks, i guess we reached the upper limit or near.