At the moment in Ireland there is a conundrum for first time buyers: should you buy now and potentially over-pay on purpose?
It’s an unusual one and it partly related to property prices, it is a combination of taxation changes that will occur from the start of 2012 and expectations of interest rate changes from both banks and the ECB.
The argument of ‘rent or buy‘ is well established, we produced report on it with Peter Stafford (now of the IAVI/SCS) and Frank Quinn of Senior College Dun Laoghaire, but this is different – buy now or buy later isn’t taking the default of renting as an assumed continuous option, rather it is a case of delaying for the sake of market timing.
The changes in tax are on the tax expenditure side, namely TRS (tax relief at source).
Currently it is applicable to a maximum of €10,000 p.a. and the rates applicable are …