Irish Property Market chat II - *read mod note post #1 before posting*

I really can’t see that type a taxation being an incentive to a landowner, it may have the opposite effect to that intended..

Last year I fixed my mortgage for 5 years, thinking 5 years would see me past the worst of the rate hikes and they'll start to come down again. I'm kind of regretting not fixing for 10 now.

No offence, but why would you even bother looking at the interest rate until your fixed rate expires. You have certainty of repayments.

Sleep well at night for the next few years and make over payments (if allowed), or else build a buffer for a big cash payment off the balance in 4 years time.

The interest rate increases will probably induce a recession before inflation gets back on target and there's a good chance of overcorrection which would require cuts in interest rates to stimulate the economy again. 5 years seems reasonable, in 10 you might be regretting it.

maybe It’s because it would prevent land hoarding

Ive been told to go variable on a mortgage meeting is this pulling the p1ss ?-variable rate offered 3.9 per cent

I suspect the mortgage rates available up to last year will never be seen again.

Is this because you think labour shortages will cause continued wage pressure or some other factor?

There should be some kind of windfall tax on land that gets rezoned. The tax should be on the difference in value before and after rezoning. Now 80% sounds like a bit too much, but it should be reasonably high. Similar with increase in values due to new public infrastructure (Luas, metro etc.) being built.

By the 80's the general criteria was 3X one salary and 1X the second salary. While in theory it might have seemed easier unemployment was 15-20% most of the time. Emigration was rampant about 15-20%of my school class emigrated, I had relations where in one family 4 sibling emigrated and never returned except on holidays.

Labour was cheap. Trades people were directly employed by builders and paid below the average industrial wage. Tradespeople often took jobs as postmen, P&T( Telecom Eireann) or similar general operatives in state bodies as pay and conditions were better because there was so many of them.

A house build in the eighties was F rated on present building regulations and bears little resemblance to those house at present. House were much more basic than at present

People need to under stand the difference. H&S on build sites was non existent, 29-30 building workers lost there life every year and many more would have been seriously injured.

There was very little building regulations, the first attempt was Homebond in 1978. A lot of houses were build by cash payments, this was especially rampant in house refurbishment. There would have been little or no certification compared to at present.

When I subcontracted my house in 1991 I got the house build in six months. I was getting foundation dug before the final grant of planning was granted. The engineer certifying for the bank payments made 4 visits to the house during the construction phase. He cost about 0.5% of the total house build cost ( nowadays it 2%+ for direct build). I did not take out any insurance ( virtually nobody did). The house design and planning ist 0.5% as well again this is about 2% now for direct build. There was no LA levies. I could get credit from a building supplier.

There was a dodge going on at the time( I was unaware of it until after was I disgusted) you get a builders to order your materials and you could pay him the cash for the material and he would not charge you vat.

Trades people in general were paid cash it was up to them to decide if they wanted to declare it.

The whole upside of this was it was harder for builders to charge astronomical margins on houses and probably with the exception of Dublin it kept a lid on house building costs

People always want to take what others have for themselves.

When did Ireland become a place where the national pastime is to figure out how we can take tax people more.

It seems every time anyone is doing well there are calls for a tax from many people.

If the value of your home benefits from a government decision, say to build a metro line, or a school nearby, would you agree to an 80% tax on the profit from its sale? Of course not.

Look, saying a tax of 80% should apply to rezoned land is bone headed. All that will happen is the owners will sit on their land rather than give away 80% of its value. If you want to incentivise development/sales, you make it more appealing to sell/develop it, not less so.

Home value tax is unworkable because its impossible to quantify the impact of something like that.

The impact of an undeveloped piece of land being rezoned is very measurable. It is very easy to assess a plot of agricultural land of a given size, and deduce what it would sell for were it not rezoned, then tax the difference.

If your land is rezoned, why would you sit on it? If you are a land speculator (many are) your plans of making a mint by hoarding the land until rezoning have been dashed, now you might aswell sell as holding is not worth it anymore. There is nothing more to earn from waiting so land will get turned over quicker.

Eventually land speculators will mostly be flushed out of the market. Which is a good thing.

I assume in this scenario (proposal is linked to Kenny report), the tax is payable immediately, not when the land is sold? So ‘sitting on it’ won’t be possible, it’ll have to be sold to cover the tax bill.

It’s essentially a slightly more generous version of a CPO. Land identified to be in the public interest for development, must be developed. Instead of just taking it at agri value, the landowner is allowed to keep 20% of the profit generated.

Seems fair to me.

Well. Because he owns the land and if you want to buy it off him then pay him what its worth. No need for a tax. The buyer still pays the same money for the site.