2021 Irish Property Market chat - *mod warnings post 1*

Hubertj

Villa05 wrote: »

Tax is dodged by reits here, I'd doubt it very much if that is the case in Germany

What are the "populist" policies in the Irish housing market. I'm struggling to pinpoint one. Is it rent controls
Its quiet clear to most here that the private sector is dictating policy and their agenda is profit for them and risk to the state

No country should be any way reliant on construction. It is a sector that is byproduct of the economy not a driver of it

How difficult is it to plan for a supply demand balance when you have over 20 years notice of a person being born and at an age when they might have a housing need or 30 years when they might buy.
We know from income data that 50% of the population will struggle to buy/rent then we need to have alternatives to the private sector for that.

We are not trying to reinvent the wheel here

RPZs would be 1 instead of actually addressing the systemic issues. How many times has legislation been changed in the last few years negatively impacting a landlords control of their own property instead of addressing the actual issues the sector faces? You believe it’s all a conspiracy when it’s more complex than that.

markodaly

Graham wrote: »

muttering from........

Government sources, it was in the papers during the week, that there is a limit on how much Ireland can borrow and keep paying the PUP for example.

Rebalancing the budget was mentioned which is code for tax rises.

Graham

Wouldn't mind a link or two if you have them, I must have missed it. I certainly don't recall anything about borrowing limits or tax increases.

Thanks

markodaly

Graham wrote: »

Wouldn't mind a link or two if you have them, I must have missed it. I certainly don't recall anything about borrowing limits or tax increases.

Thanks

Think it was in the Irish Examiner during the week, possible Wednesday or Thursday.

Villa05

Hubertj wrote:

RPZs would be 1 instead of actually addressing the systemic issues. How many times has legislation been changed in the last few years negatively impacting a landlords control of their own property instead of addressing the actual issues the sector faces? You believe it’s all a conspiracy when it’s more complex than that.

RPZ allow for 4% inflation in rents, that is considerably higher than general inflation and wage inflation.

Gov have been pushing small landlords out of the market which is unhelpful IMO. Im not convinced that the rental market is stacked heavily in the tenants favour, quite the contrary. There are far more good tenants than bad and likewise LL"s.
I'm puzzled why LL"s are not complaining about the tax treatment of REITs over smaller LLs where there is clear visible enormous inequality.

Again can you tell me about this conspiracy

PommieBast

enricoh wrote: »

Was reading cormac luceys article in the Sunday times today, it really pointed out how Ireland is a one trick pony n totally reliant on corporation tax. 40% of all tax generated comes from mnc's.

Corporation tax is either going to reduce a bit or a lot- not great options.theres going to be a lot of holes in the coffers n housing will be in the firing line imo. I can't see government levels of spending on housing continuing. Property tax won't be peanuts either as I don't think they can tax working much more. I don't think wages can rise much more either or competitiveness goes out the door. Better chance of price drops than price rises imo.

It is ironic that the collapse in revenue related to property sales was instrumental in the troika coming to town.

cnocbui

enricoh wrote: »

Was reading cormac luceys article in the Sunday times today, it really pointed out how Ireland is a one trick pony n totally reliant on corporation tax. 40% of all tax generated comes from mnc's.

Corporation tax is either going to reduce a bit or a lot- not great options.theres going to be a lot of holes in the coffers n housing will be in the firing line imo. I can't see government levels of spending on housing continuing. Property tax won't be peanuts either as I don't think they can tax working much more. I don't think wages can rise much more either or competitiveness goes out the door. Better chance of price drops than price rises imo.

That article must have been counting things like income tax from employess, because in 2019, corporation tax amounted to 18.35% of government revenue, by my calculations. https://www.audit.gov.ie/en/find-report/publications/2020/2019-annual-report-chapter-1-exchequer-financial-outturn-for-2019.pdf

The corporation tax is already very low.

combat14

markodaly wrote: »

Government sources, it was in the papers during the week, that there is a limit on how much Ireland can borrow and keep paying the PUP for example.

Rebalancing the budget was mentioned which is code for tax rises.

ah lads cant pay any more taxes .. already like taking blood from a stone .....

going to be very difficult to keep paying those nose bleed rents in dublin if income taxes go up


then again a huge proportion of lower income workers are paying no taxes compared to most european countries perhaps the government could start there ..
but the landlords wont be happy when the rent strike happens lol

PropQueries

combat14 wrote: »

ah lads cant pay any more taxes .. already like taking blood from a stone .....

going to be very difficult to keep paying those nose bleed rents in dublin if income taxes go up


then again a huge proportion of lower income workers are paying no taxes compared to most european countries perhaps the government could start there ..
but the landlords wont be happy when the rent strike happens lol

Leo Varadkar last November called for “a grown-up conversation on increasing Employers' and Employees' PRSI to fund a reformed social insurance system, including income-linked unemployment benefits.”

And, remember they were also looking at increasing the pension age before the last election in January 2020.

Carbon taxes will also increase substantially every year. They may not increase income taxes but everything else will. Also, given that councils are going to permanently get less in commercial rates going forward, residential property taxes will most likely increase significantly going forward to meet any shortfall IMO.

There’s only property, pensions and inheritance taxes left to tax IMO

It’s only then that my age group will see how the mismanagement of housing is going to impact us directly going forward IMO

Link to RTÉ article on Leo calling for a grown-up conversation on PRSI hikes here: https://www.rte.ie/news/2020/1123/1180017-low-pay-prsi/

Hubertj

Villa05 wrote: »

RPZ allow for 4% inflation in rents, that is considerably higher than general inflation and wage inflation.

Gov have been pushing small landlords out of the market which is unhelpful IMO. Im not convinced that the rental market is stacked heavily in the tenants favour, quite the contrary. There are far more good tenants than bad and likewise LL"s.
I'm puzzled why LL"s are not complaining about the tax treatment of REITs over smaller LLs where there is clear visible enormous inequality.

Again can you tell me about this conspiracy

I read the relevant sections of the RTA a while back to understand what has changed the last few years. To suggest the changes haven’t negatively impacted landlords in favour of tenants would indicate you didn’t understand the changes or choose to ignore them. Changes that were introduced due to address populist views in media and among certain political elements. What needed to happen was existing legislation properly enforced, RTB properly resourced and held accountable, amongst other things.
You seem to think everything is a conspiracy. Ethernet government and a few rich developers and funds to extract maximum value from the tax payer. If only it was that easy.

PropQueries

Hubertj wrote: »

I read the relevant sections of the RTA a while back to understand what has changed the last few years. To suggest the changes haven’t negatively impacted landlords in favour of tenants would indicate you didn’t understand the changes or choose to ignore them. Changes that were introduced due to address populist views in media and among certain political elements. What needed to happen was existing legislation properly enforced, RTB properly resourced and held accountable, amongst other things.
You seem to think everything is a conspiracy. Ethernet government and a few rich developers and funds to extract maximum value from the tax payer. If only it was that easy.

Rents in Dublin in 2019 were 40% above 2007 levels. How is that a "negatively impacted"? Landlords have been the only gainers IMO.

My opinion is that landlords appear to be more upset that they now have to pay both tax on their income like every other business and have to now also ensure their properties aren't firetraps i.e. just like every other business e.g. hotels, concert venues, pubs etc. Yes, they were also required to pay tax before but, unlike now, it wasn't adequately enforced.

HAP (from c.€400k spent in 2014 to c.€500 million spent in 2019), which is basically a direct subsidy to landlords to keep market rents at existing levels wouldn't be needed if a proper vacant property tax was introduced like many other countries in the developed world from socialist EU countries to capitalist America.

An extra €500 million a year would pay for a lot of extra nurses, doctors, ambulances, gardai etc. Instead it goes directly into the bank accounts of landlords IMO

IAmTheReign

enricoh wrote: »

Was reading cormac luceys article in the Sunday times today, it really pointed out how Ireland is a one trick pony n totally reliant on corporation tax. 40% of all tax generated comes from mnc's.

Corporation tax is either going to reduce a bit or a lot- not great options.theres going to be a lot of holes in the coffers n housing will be in the firing line imo. I can't see government levels of spending on housing continuing. Property tax won't be peanuts either as I don't think they can tax working much more. I don't think wages can rise much more either or competitiveness goes out the door. Better chance of price drops than price rises imo.

Have you a link that article? I'm curious to see where exactly they got that 40% number. OECD has corporation tax at only 14% of total tax take, not 40%.

https://www.oecd.org/tax/revenue-statistics-ireland.pdf

PropQueries

IAmTheReign wrote: »

Have you a link that article? I'm curious to see where exactly they got that 40% number. OECD has corporation tax at only 14% of total tax take, not 40%.

https://www.oecd.org/tax/revenue-statistics-ireland.pdf

The article is very good. The writer points was that when you include corporation tax, the taxes on their workers salaries, VAT on their local purchases etc., that 40% of government revenues are dependent upon multinationals in Ireland and that the Government should be keeping a closer eye on the upcoming global tax changes and Biden, UK and EU looking to take these taxes and jobs back to their own countries.

You can read one article in the Sunday Times free by signing up.

Link to Sunday Times article here: https://www.thetimes.co.uk/article/cormac-lucey-white-house-has-its-finger-on-the-trigger-and-is-targeting-our-corporation-tax-take-vx7rh0zvr

The_Conductor

PropQueries wrote: »

Leo Varadkar last November called for “a grown-up conversation on increasing Employers' and Employees' PRSI to fund a reformed social insurance system, including income-linked unemployment benefits.”

Income linked unemployment benefits and/or contributory pensions- run counter to the message being sold by several of the left-leaning political groupings, who imply that the proletariat are all equally deserving, irrespective of what they have or have not put into the system.

The fact of the matter is- the system as it stands is not in good financial health, and as the dependency ratio heads from 4:1 towards 2:1- this strain is only going to get more and more apparent.

PropQueries wrote: »

And, remember they were also looking at increasing the pension age before the last election in January 2020.

Today, Monday the 8th of Jan- they have announced a blanket payment of EUR203 a week (aka unemployment rate) for all those who retire at 65 but aren't eligible for the COAP or the NCOAP until age 66- without any necessity to pretend they are seeking employment etc. This new arrangement is to be implemented immediately. The Minister (Heather Humphreys) sees it as extremely progressive. Hmmm- lets see.

PropQueries wrote: »

Carbon taxes will also increase substantially every year. They may not increase income taxes but everything else will. Also, given that councils are going to permanently get less in commercial rates going forward, residential property taxes will most likely increase significantly going forward to meet any shortfall IMO.

There’s only property, pensions and inheritance taxes left to tax IMO

We are already signed up to continuous increases in carbon taxes- alongside a new road tax that is divorced from the notion of crucifying older cars while not making new cars pay their shares.

Income taxes may not increase- however, we urgently need a new band- and a broadening of the base to bring more people into the tax bands- including a tally of *all* income (the whole notion of exempt income, be it social welfare disbursements, subsidised housing or whatever- it all needs to be tallied and taxed). Until such time as the notion of a free-hand-out gets hit on the head for once and for all, we're going to be sunk.

Residential property tax- is a joker- its set at such an implausibly low level on the one hand, and the size of a dwelling has no input into the tax on the other hand. It makes perfect sense to thoroughly reform this- however, the whole notion of people living in rural mansions versus shoebox apartments in Dublin- also needs to be addressed in this one. Arguably, and a sop towards those living in managed complexes- anyone paying management fees to an OMC- should be able to deduct them in full from their property taxes (and the property tax should be set at a level capable of absorbing this- which may well be a couple of grand- tough titties).

PropQueries wrote: »

It’s only then that my age group will see how the mismanagement of housing is going to impact us directly going forward IMO

Its not just housing though- its across the board- we may have one of the great redistributive tax systems- however, its at the cost of a squeezed middle who are well capable of working far more productively, but who don't, because our penal rate of taxes and charges kicks in at an abnormally low level of circa 35k. We need to incentivise this group- its hard to motivate people when a majority of their marginal income is going straight to the government.

PropQueries wrote: »

Link to RTÉ article on Leo calling for a grown-up conversation on PRSI hikes here: https://www.rte.ie/news/2020/1123/1180017-low-pay-prsi/

PRSI- is only one element of the equation. How to fund PRSI disbursements- in a time of an aging population- is one question that needs to be answered. How to be equitable to a workforce who are contributing an increasing proportion of their income towards PRSI tolls, when there is sweet damn all difference between a contributory old age pension and a non-contributory old age pension- is going to set the great unwashed proletariat against those middle income earners who are paying between 10 and 16% for something that their next door neighbour gets for free........

A lot of the discussions and changes that have to happen- are going to be terribly unpopular, and our gormless politicians have shown that they don't have the gonads to look beyond the media and the court of public opinion. Frankly- its a foregone conclusion that they are going to fail on this.

PropQueries

The_Conductor wrote: »

Income linked unemployment benefits and/or contributory pensions- run counter to the message being sold by several of the left-leaning political groupings, who imply that the proletariat are all equally deserving, irrespective of what they have or have not put into the system.

The fact of the matter is- the system as it stands is not in good financial health, and as the dependency ratio heads from 4:1 towards 2:1- this strain is only going to get more and more apparent.



Today, Monday the 8th of Jan- they have announced a blanket payment of EUR203 a week (aka unemployment rate) for all those who retire at 65 but aren't eligible for the COAP or the NCOAP until age 66- without any necessity to pretend they are seeking employment etc. This new arrangement is to be implemented immediately. The Minister (Heather Humphreys) sees it as extremely progressive. Hmmm- lets see.



We are already signed up to continuous increases in carbon taxes- alongside a new road tax that is divorced from the notion of crucifying older cars while not making new cars pay their shares.

Income taxes may not increase- however, we urgently need a new band- and a broadening of the base to bring more people into the tax bands- including a tally of *all* income (the whole notion of exempt income, be it social welfare disbursements, subsidised housing or whatever- it all needs to be tallied and taxed). Until such time as the notion of a free-hand-out gets hit on the head for once and for all, we're going to be sunk.

Residential property tax- is a joker- its set at such an implausibly low level on the one hand, and the size of a dwelling has no input into the tax on the other hand. It makes perfect sense to thoroughly reform this- however, the whole notion of people living in rural mansions versus shoebox apartments in Dublin- also needs to be addressed in this one. Arguably, and a sop towards those living in managed complexes- anyone paying management fees to an OMC- should be able to deduct them in full from their property taxes (and the property tax should be set at a level capable of absorbing this- which may well be a couple of grand- tough titties).



Its not just housing though- its across the board- we may have one of the great redistributive tax systems- however, its at the cost of a squeezed middle who are well capable of working far more productively, but who don't, because our penal rate of taxes and charges kicks in at an abnormally low level of circa 35k. We need to incentivise this group- its hard to motivate people when a majority of their marginal income is going straight to the government.



PRSI- is only one element of the equation. How to fund PRSI disbursements- in a time of an aging population- is one question that needs to be answered. How to be equitable to a workforce who are contributing an increasing proportion of their income towards PRSI tolls, when there is sweet damn all difference between a contributory old age pension and a non-contributory old age pension- is going to set the great unwashed proletariat against those middle income earners who are paying between 10 and 16% for something that their next door neighbour gets for free........

A lot of the discussions and changes that have to happen- are going to be terribly unpopular, and our gormless politicians have shown that they don't have the gonads to look beyond the media and the court of public opinion. Frankly- its a foregone conclusion that they are going to fail on this.

Some good points. But I think peoples opinions on the possible savings achievable on social welfare spending were debunked by the actual Government figures on the 2019 c. €20 billion "social welfare" spend. Even if they cut dole down to zero, it would have a minimal impact on Government revenues while also increasing spending on crime, homelessness, anti-social behaviour etc. i.e. no net benefit to government revenues outside of making the lives of the bottom 1% more miserable than they already are and also making the lives of the middle class more miserable by having to live with this extra crime etc. IMO

Link to the breakdown of the 2019 "social welfare" spending here: https://whereyourmoneygoes.gov.ie/en/socialprotection/2019/

hometruths

PropQueries wrote: »

The article is very good. The writer points was that when you include corporation tax, the taxes on their workers salaries, VAT on their local purchases etc., that 40% of government revenues are dependent upon multinationals in Ireland and that the Government should be keeping a closer eye on the upcoming global tax changes and Biden, UK and EU looking to take these taxes and jobs back to their own countries.

You can read one article in the Sunday Times free by signing up.

Link to Sunday Times article here: https://www.thetimes.co.uk/article/cormac-lucey-white-house-has-its-finger-on-the-trigger-and-is-targeting-our-corporation-tax-take-vx7rh0zvr

There is a copy, not sure if it is full version, on Cormac Lucey's blog. http://cormaclucey.blogspot.com/2021/02/white-house-has-its-finger-on-trigger.html

Stand out point for me is:

Ireland’s remarkable economic progress in recent decades has relied on us clambering onto the shoulders of others, particularly America. In this entire matter we are price-takers, dependent on the decisions of others, more than price-makers, who get to determine the rules.

If these companies are here for other reasons than tax, eg the weather, then we have nothing to worry about.

But if not...

MacronvFrugals

Yew Grove Reit sets its sights on offices outside Dublin

Yew Grove is attracted to the Dublin suburban market, as it believes that in the wake of the pandemic, young office workers will prefer to work in offices in order to develop their careers and to avoid working in small apartments. For them, and also for those with houses who are also working from home, offices will need to be more attractive places to work.

The Reit also wishes to purchase in Cork, Galway and Limerick.

Granted 20 million is not that much here but interesting comments on the WFH cohort.

https://www.businesspost.ie/commercial/yew-grove-reit-sets-its-sights-on-offices-outside-dublin-c4619709?auth=login

ELM327

PropQueries wrote: »

Rents in Dublin in 2019 were 40% above 2007 levels. How is that a "negatively impacted"? Landlords have been the only gainers IMO.

My opinion is that landlords appear to be more upset that they now have to pay both tax on their income like every other business and have to now also ensure their properties aren't firetraps i.e. just like every other business e.g. hotels, concert venues, pubs etc. Yes, they were also required to pay tax before but, unlike now, it wasn't adequately enforced.

HAP (from c.€400k spent in 2014 to c.€500 million spent in 2019), which is basically a direct subsidy to landlords to keep market rents at existing levels wouldn't be needed if a proper vacant property tax was introduced like many other countries in the developed world from socialist EU countries to capitalist America.

An extra €500 million a year would pay for a lot of extra nurses, doctors, ambulances, gardai etc. Instead it goes directly into the bank accounts of landlords IMO

I would love to pay tax on rental income like other businesses.

fliball123

Could this be a game changer for the rental market? Just listening to P.Kenny talking about it on newstalk right now. 25% below market and long term contracts and only for people working.

https://www.irishtimes.com/news/ireland/irish-news/state-s-first-cost-rental-scheme-to-provide-350-new-homes-by-end-of-2021-1.4436259

PropQueries

fliball123 wrote: »

Could this be a game changer for the rental market? Just listening to P.Kenny talking about it on newstalk right now. 25% below market and long term contracts and only for people working.

https://www.irishtimes.com/news/ireland/irish-news/state-s-first-cost-rental-scheme-to-provide-350-new-homes-by-end-of-2021-1.4436259

The interesting thing would be if market rents fall by c. 50% in the next two years. Will those cost-rental tenants then get a rent reduction?

fliball123

PropQueries wrote: »

The interesting thing would be if market rents fall by c. 50% in the next two years. Will those cost-rental tenants then get a rent reduction?

Can you see rent falling by 50% in the next 2 years. How much has it fallen by in 2019/2020 with all the different issues going on?

The_Conductor

PropQueries wrote: »

The interesting thing would be if market rents fall by c. 50% in the next two years. Will those cost-rental tenants then get a rent reduction?

How could they- if their rent is based on factors other than the prevailing rate of rent?

Hubertj

schmittel wrote: »

There is a copy, not sure if it is full version, on Cormac Lucey's blog. http://cormaclucey.blogspot.com/2021/02/white-house-has-its-finger-on-trigger.html

Stand out point for me is:



If these companies are here for other reasons than tax, eg the weather, then we have nothing to worry about.

But if not...

Yes they’re only here for the tax

hometruths

fliball123 wrote: »

Can you see rent falling by 50% in the next 2 years. How much has it fallen by in 2019/2020 with all the different issues going on?

They fell 3.3% in Dublin, rose by 5.4% outside Dublin.

Rents fell in 23 of Dublin’s 25 markets with modest annual increase in rents of 0.2 per cent in Dublin 24 and 0.5 per cent in Dublin 20. In Dublin, 1, 4 and 6, rents in the final three months of 2020 were 6 per cent lower than a year earlier, while in Dublin 2, they were down 7 per cent.

https://www.irishtimes.com/business/economy/rents-in-dublin-fell-3-3-last-year-as-supply-rose-due-to-covid-19-1.4478402

MacronvFrugals

Hubertj wrote: »

Yes they’re only here for the tax

Mostly here for tax....

PropQueries

The_Conductor wrote: »

How could they- if their rent is based on factors other than the prevailing rate of rent?

Well, then the tenants may move out and rent somewhere cheaper. Is the state then going to leave them empty (like the REITS etc.) until they get the rent they want?

PropQueries

MacronvFrugals wrote: »

Mostly here for tax....

I think a good way to prove that is to see how many times the CEO's of Apple, Microsoft, Google, Facebook etc. have visited their European headquarters in Ireland over the past several years.

fliball123

schmittel wrote: »

They fell 3.3% in Dublin, rose by 5.4% outside Dublin.



https://www.irishtimes.com/business/economy/rents-in-dublin-fell-3-3-last-year-as-supply-rose-due-to-covid-19-1.4478402

cool so with no tourism over some of that period I cant see rents dropping by 50% in the next 2 years.

Hubertj

MacronvFrugals wrote: »

Mostly here for tax....

Of course they are

hometruths

fliball123 wrote: »

cool so with no tourism over some of that period I cant see rents dropping by 50% in the next 2 years.

Tourism is not really supposed to be a big driver of domestic rents.

Cyrus

PropQueries wrote: »

I think a good way to prove that is to see how many times the CEO's of Apple, Microsoft, Google, Facebook etc. have visited their European headquarters in Ireland over the past several years.

how does that prove anything?

how often do they visit any HQ outside the US?

fliball123

schmittel wrote: »

Tourism is not really supposed to be a big driver of domestic rents.

No but currently are properties that were used for short term rent now being used for long term. I could be wrong but wasnt there an increase in rentals available once the likes of AirBnb was no longer possible?

hometruths

fliball123 wrote: »

No but currently are properties that were used for short term rent now being used for long term. I could be wrong but wasnt there an increase in rentals available once the likes of AirBnb was no longer possible?

Yep, you're right - I just meant that if tourism is being relied upon to keep rents stable, it is weak fundamentals.

Landlords offering STLs for tourism in RPZs is illegal. If this was actually enforced we could see rents drop very quickly.

fliball123

schmittel wrote: »

Yep, you're right - I just meant that if tourism is being relied upon to keep rents stable, it is weak fundamentals.

Landlords offering STLs for tourism in RPZs is illegal. If this was actually enforced we could see rents drop very quickly.

Ah no just countering props idea that we could see a 50% drop in rent in 2 years.

awec

PropQueries wrote: »

I think a good way to prove that is to see how many times the CEO's of Apple, Microsoft, Google, Facebook etc. have visited their European headquarters in Ireland over the past several years.

What a bizarre statement.

MacronvFrugals

Construction sites to re-open on March 5, says Housing Minister

Construction sites will be allowed to re-open on March 5, Housing Minister Darragh O’Brien has said.

He said the closure of sites means the delay of the delivery of between 700 and 800 homes per month and he wants sites open again as soon as it is safe to do so.

He said the decision to close sites was not to do with a concern of the safety of sites, but more to do with the wider national effort to limit social contacts.

“We are working towards March 5, in terms opening up of the construction site sector, as it can be done safely. The provision of homes and housing is crucially important, essential, in my view,” he said.

This should help not further constrict supply


https://www.irishexaminer.com/news/politics/arid-40222511.html

Villa05

The_Conductor wrote:

Today, Monday the 8th of Jan- they have announced a blanket payment of EUR203 a week (aka unemployment rate) for all those who retire at 65 but aren't eligible for the COAP or the NCOAP until age 66- without any necessity to pretend they are seeking employment etc. This new arrangement is to be implemented immediately. The Minister (Heather Humphreys) sees it as extremely progressive. Hmmm- lets see.

The_Conductor wrote:

Its not just housing though- its across the board- we may have one of the great redistributive tax systems- however, its at the cost of a squeezed middle who are well capable of working far more productively, but who don't, because our penal rate of taxes and charges kicks in at an abnormally low level of circa 35k. We need to incentivise this group- its hard to motivate people when a majority of their marginal income is going straight to the government.

Miss the frequency of your postings of wisdom, but understand why

If we standardised tax breaks on pensions and the other stuff at the 20 % rate or even lower and used the savings to widen the tax bands, would that have much of an impact
The other concern is that the more money we put in people's pockets the more the construction/property sector hovers up so it becomes a 0 sum game at best. It actually becomes negative as the higher prices mean more people will need subsidised accommodation.

How do we stop property being a leech on the economy?

IAmTheReign

PropQueries wrote: »

The article is very good. The writer points was that when you include corporation tax, the taxes on their workers salaries, VAT on their local purchases etc., that 40% of government revenues are dependent upon multinationals in Ireland and that the Government should be keeping a closer eye on the upcoming global tax changes and Biden, UK and EU looking to take these taxes and jobs back to their own countries.

You can read one article in the Sunday Times free by signing up.

Link to Sunday Times article here: https://www.thetimes.co.uk/article/cormac-lucey-white-house-has-its-finger-on-the-trigger-and-is-targeting-our-corporation-tax-take-vx7rh0zvr

Fair enough if you include the income tax from the people working for them and the tax take on their spending I could see how you might get to 40%, but that's not what the poster I replied to was saying. He said specifically that Ireland was totally reliant on corporation tax which is obviously not true.

IAmTheReign

schmittel wrote: »

Yep, you're right - I just meant that if tourism is being relied upon to keep rents stable, it is weak fundamentals.

Landlords offering STLs for tourism in RPZs is illegal. If this was actually enforced we could see rents drop very quickly.

It is being enforced. there was an article posted on here the other day saying that 70% of suspected airbnb properties are now being used for long term rentals.

MacronvFrugals

Its worth pointing out without social transfers our poverty rate would be 42%


https://www.irishexaminer.com/news/spotlight/arid-40213142.html

JimmyVik

markodaly wrote: »

Strong mutterings that we will have some sort of tax-based claw back this year in the budget, given that we are spending way above what was forecast last year.

To put simply, Ireland and Europe and a lot of the world to be fair are floating in money, to keep the show on the road during the pandemic. If we get out of it by the end of the year, the waterfall of new money will dry up and the bills will have to be paid, which means tax rises, unemployment and longer-term issues of debt.

No one really knows how all this is going to play out. But we could be in for a bit of a contraction over the next year or two.

I, for one, will be going on a big spending spree as soon as this whole virus thing is over.
But if taxes go up, i will batten down the hatches, and spend nothing while I prepare to have even more of my hard earned money taken out of my pocket over the next few years.

They need to stick to their plan of not gouging people and then people will start spending. Start gouging them and it will have the opposite effect.

Villa05

fliball123 wrote:

Could this be a game changer for the rental market? Just listening to P.Kenny talking about it on newstalk right now. 25% below market and long term contracts and only for people working.

From my time when I was renting, a good tenant could nearly always find a good landlord and together both would be happy with a significant discount on market rates.

I like the focus on people working for this scheme, but considering rents were 40% above 2007 peaks recently. I think we could do better or make this an income generator for the state to fund expansion

schmittel wrote:

Yep, you're right - I just meant that if tourism is being relied upon to keep rents stable, it is weak fundamentals.

IAmTheReign wrote:

Fair enough if you include the income tax from the people working for them and the tax take on their spending I could see how you might get to 40%, but that's not what the poster I replied to was saying. He said specifically that Ireland was totally reliant on corporation tax which is obviously not true.

We were not totally reliant on construction taxes in the noughties. Its the recurring spending that is implemented from these taxes that is the issue

PropQueries

MacronvFrugals wrote: »

Its worth pointing out without social transfers our poverty rate would be 42%


https://www.irishexaminer.com/news/spotlight/arid-40213142.html

And it's basically down to a dysfunctional housing policy. The only cost that materially impacts on the lower and middle income groups is housing. Every other cost is relatively meaningless.

And if the older middle class groups really want to delve into "social transfers", I think they should be very wary in case the younger generation (who are now getting older and more politically and economically astute by the day), start looking into these pensions that us older groups in both the private and public sector believe we're "entitled" to.

JimmyVik

Villa05 wrote: »

Tax is dodged by reits here, I'd doubt it very much if that is the case in Germany

What are the "populist" policies in the Irish housing market. I'm struggling to pinpoint one. Is it rent controls
Its quiet clear to most here that the private sector is dictating policy and their agenda is profit for them and risk to the state

No country should be any way reliant on construction. It is a sector that is byproduct of the economy not a driver of it

How difficult is it to plan for a supply demand balance when you have over 20 years notice of a person being born and at an age when they might have a housing need or 30 years when they might buy.
We know from income data that 50% of the population will struggle to buy/rent then we need to have alternatives to the private sector for that.

We are not trying to reinvent the wheel here

I rented in Germany for a few years.
Try staying in a rental and not paying your rent over there.
You wouldnt get away with it like in Ireland.
Less risk than for the property owner in Ireland.
In Ireland risk is a big part of the rent.

JimmyVik

PropQueries wrote: »

Some good points. But I think peoples opinions on the possible savings achievable on social welfare spending were debunked by the actual Government figures on the 2019 c. €20 billion "social welfare" spend. Even if they cut dole down to zero, it would have a minimal impact on Government revenues while also increasing spending on crime, homelessness, anti-social behaviour etc. i.e. no net benefit to government revenues outside of making the lives of the bottom 1% more miserable than they already are and also making the lives of the middle class more miserable by having to live with this extra crime etc. IMO

Link to the breakdown of the 2019 "social welfare" spending here: https://whereyourmoneygoes.gov.ie/en/socialprotection/2019/

I have an idea.
Id like to take a break and go on the dole for a few years.
Sick of paying tax through every orifice for the last 25 years.
But no, im not allowed to get the dole if I quit. Im like the slave that is getting the blood rung out of him to feed the people who do nothing.Let someone on the dole take my job, please. Let them pay the tax and i'll gladly swap that job for their dole at this point. Too much tax, from all directions.

TobyHolmes

MacronvFrugals wrote: »

Its worth pointing out without social transfers our poverty rate would be 42%


https://www.irishexaminer.com/news/spotlight/arid-40213142.html

so ireland is basically a liberal welfare state with archaic housing policies.


im all for tax money being used wisely towards such programs to help those in need - however questions need to be asked (and answered) when people earning good income salaries cant even get on the property ladder due to lack of supply driving prices up.



For example - to deal with supply why cant people get planning permission for alternative housing such as shipping containers or log cabins etc. as a main residence if they own the land.



because the state doesnt want that? why not?



there is no creative thinking at all.

PropQueries

JimmyVik wrote: »

I rented in Germany for a few years.
Try staying in a rental and not paying your rent over there.
You wouldnt get away with it like in Ireland.
Less risk for the property owner in Ireland.
In Ireland risk is a big part of the rent.

What are the mechanisms available to landlords over there if a tenant doesn't pay their rent?

Marius34

PropQueries wrote: »

What are the mechanisms available to landlords over there if a tenant doesn't pay their rent?

Loss 3 months rent worth deposit for the start.

hometruths

JimmyVik wrote: »

I rented in Germany for a few years.
Try staying in a rental and not paying your rent over there.
You wouldnt get away with it like in Ireland.
Less risk for the property owner in Ireland.
In Ireland risk is a big part of the rent.

Which is exactly why we see a large number of vacant properties. For many the risk/reward of a tenant is not worth it, even with high rents.

In a rising market, they are better off keep it vacant, get income from STLs if they wish.

Even if they don't go down the STL route and forego the income, if the market is rising 2-3% per annum they are still doing ok compared to having the money sitting in the bank.

Factor in that many of these properties have CGT exemptions on them and it is a no brainer.

Of course it is only a no brainer as long as the market is rising. If market starts to turn and CGT benefits are diminishing, the no brainer choice becomes do you put it on the market for sale or for rent?

PropQueries

JimmyVik wrote: »

I have an idea.
Id like to take a break and go on the dole for a few years.
Sick of paying tax through every orifice for the last 25 years.
But no, im not allowed to get the dole if I quit. Im like the slave that is getting the blood rung out of him to feed the people who do nothing.Let someone on the dole take my job, please. Let them pay the tax and i'll gladly swap that job for their dole at this point. Too much tax, from all directions.

Good luck on paying for rent (yes they do pay some no matter how small), food, electricity, gas, broadband, mobile phone, clothing, footwear, car, petrol, insurance, travel once a year to a wedding etc. on €203 a week.

Just out of curiosity. For the posters who seem to truly believe that giving up their job and being on the dole would make them better off, have they looked at their ESB/Gas bill after Christmas?