In this piece we were asked to contribute to a conversation on the constitutional right to housing. Maeve Regan from The Mercy Law Resource Centre discussed the merits of the idea which was put forward by the charity she heads up, while Karl Deeter took the view that an addition to the constitution of a right to housing won’t resolve the problem and that the right already exists.
We were really pleased that Morning Ireland covered our joint idea with Fr. Peter McVerry on a way to help reduce pressure in the rented sector by giving landlords tax breaks in return for rent-freezes.
The idea is simple, you allow landlords to get full mortgage interest relief and offset their local property tax in return for giving the tenant a ‘rent freeze’, this can be managed via the PRTB who already link in with Revenue on some matters.
The clip explains how it would work, in the piece you’ll hear Fran McNulty discussing this idea with Karl Deeter
Something that comes up with regular frequency is a question about ‘being a first time buyer’. The simple version is ‘one of us bought a house in (year XXXX) or had a house in the UK or invested in one with a friend’ etc. Now that person is in a relationship with a new person and they want to know if as a couple, they are a first time buyer.
The answer? No.
Sadly, this is similar to the way that Tax Relief at Source used to work, if you had bought a house anywhere in the world, including Timbuktu, you are no longer a first time buyer and by extension, neither is anybody that you buy a house with.
The fix? Sometimes the one person who is a first time buyer can qualify for the loan and they are able to do it themselves, years ago the answer was ‘two on mortgage one on the deed’ in order to be able to obtain Tax Relief at Source (which is now gone for all loans)
Nowadays you see only that …
How can you have a marginal rate of tax that is an effective 270% against profits? Easy, be a landlord. Although this example is styled to show the highest effective tax on net profits possible, it nonetheless supports our view that the tax code is anti-landlord and that landlords should be treated the same as every other business.
Is it too much to ask, that in return for helping to put a roof over a persons head you are treated as well as a sex-shop is in the tax code? The spreadsheet for demonstrating this calculation is here. Or just click on the image to see a larger version.
With Revenue set to receive the names of over 9,000 AirBnB ‘hosts’ we looked at the implications of this as well as other ways to make your house pay for itself. The obvious one is the tax free €12,000 ‘rent a room’ scheme, but it doesn’t stop there! Find out more as Karl Deeter and Jill Kerby ‘Talk Money’.
On the 10th of August we looked at the ‘financial milestones’ you should have reached by the time you are in your 30’s.
As with many things, these are not ‘set in stone’ but in general, they are good indicators of how you are doing on your road to financial health.
Last week on Drivetime’s ‘Talking Money’ we discussed the idea of ‘downsizing’ your home and what it means, how to do it, and the things you might want to watch out for if you are considering downsizing.
As people age larger homes often become less of a requirement, equally, selling your primary home being capital gains free can be advantageous, so we looked at the angles and figured out what you should watch for.
The Central Bank rules on curtailing mortgage lending have had an interesting effect, first is that we are seeing more loans draw down that might not have because people are bringing forward consumption due to the fact they won’t qualify for the same amount again in the future. This is literally the opposite of the intended effect.
Second is that it’s causing chaos for prospective buyers who may hold an exemption or need an exemption because there are quarterly reporting rules that mean banks can’t offer a new loan until they know if an old one will be drawn or become an NTU (not taken up).
Perhaps the easiest thing to do is explain it, currently you can’t get an exemption from Ulsterbank or AIB/EBS/Haven or BOI, but you can from PTsb and KBC. The banks that can’t give you one (and remember it’s only one of LTV or LTI not both) are hogtied because they have given the limit of exemptions (c. 15%-20% of lending) already in loan offers and they have to estimate both the annual and quarterly …
When it comes to fixed mortgage rates in Ireland there is a little confusion, the first being about ‘whether to fix or not’ and secondly, if by doing so will you lose out should Irish lenders choose to lower their mortgage rates.
The simple answer is that if you fix your mortgage you may win or lose depending on what rates do, but that is missing the point of why you fix to begin with. It provides you with certainty of payments and often there is a premium due because of this, in simple terms, you pay a bit more for the ‘fixed’ assurance.
Below is a list of some of the best fixed rates in Ireland as well as who offers them.
Best 3yr fixed rate: 3.6% offered by PTsb and Bank of Ireland
(note: you can get better again by going with KBC and opening an account which gets you 3.55%)
Best 5yr fixed rate: 3.8% offered by Ulsterbank, BOI and Haven/AIB
These are ‘tiered variable rates’ meanining you have to have a low loan to value or …
This is a really common question, people are still unsure about how much they have to have in order to get a loan. While it is simple enough in terms of the rules, what is tricky is that keeping track on exceptions becomes difficult in a ‘live mortgage loan’ situation because some may draw down and others don’t.