To buy or not to buy…

We are constantly asked ‘is now a good time to buy’ and the answer as always is ‘that depends’. It depends on what you are hoping for, if you want to invest in an asset that will never lose value then no, it’s a terrible time to buy a house. If you want to buy a home because you are at a point in your life where that is what you want to do then it’s a decent time.

We were telling people from 07′ until this year to stay away from property, and now we believe that the time has come where you can make decisions rationally. It doesn’t sway it either way but you can at least get a good idea of some of the pros and cons involved.

Firstly, there is the property price register, there are issues with it – we have pointed this out before. While knowing what something sold for in the past gives no indication of the future selling price (and property is particularly heterogeneous) it …

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Bank margins after NAMA

The current debate is raging over NAMA and the pricing of loans, much of it centres on the value of the properties in question and about the way in which a ‘loan’ is valued (as opposed to the underlying asset). This makes for good headlines, but it doesn’t help the average person who is not shaping policy and who’s sole role in this mess will be to carry the can and pay their part in the tax pool which will ultimately fund the bailout.

However, you may be affected in other ways, and these are things which you have the choice of opting out of, namely that of the margin you are paying if you currently have any debt/credit outstanding.

Once NAMA comes in it will be extremely likely that banks increase their margins, it is important to consider the ‘why’ as much as the ‘when’ though so we’ll take a look at those.

Why?

PTsb lead the way on this, because they are not getting NAMA protection they have no need to worry …

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How is TRS calculated?

TRS or Tax Relief at Source, is a mortgage related tax relief available to first time buyers. The working elements of it will be described in today’s post.

When you draw down a mortgage, if you are a qualifying applicant, then you can then apply for your TRS by downloading the TRS1p form from the Revenue website. After you send it off it will take a few weeks to process, and then you will get the years tax relief averaged out over the remainder of the year.

For example (we’ll show the calculations later) if your mortgage drew down in January but your TRS only kicked in during March then the relief would be paid as the average of 12 months over 9 months – say it was meant to be  €300 per month (had it started in January) then you’d be getting  €400 per month for the remainder of the partial year.

The …

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Banks: give you an umberella when its sunny and take it back when it rains

Samuel Clemens (aka Tom Sawyer) brought us the quote which is the title of this post, ‘banks give you an umbrella when its sunny out and take it back when it rains’, his simply worded expression held as true in Missouri of the late 1800’s as it does today.

Recently we had a client who is on an interest only mortgage, their circumstances have changed right when their interest only period was about to run out, naturally we suggested that they ask for a continuance of an interest only period, while this won’t work down the capital amount owed it will keep their cash flow alive and if you have to chose between owing more and being unable to pay then the former is preferable. Sitting in a pot might not sound great but it beats the raw fire.

The bank were happy to comply and they sent out a letter, it was at this …

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First time buyers didn't, don't, and won't ever have it easy.

Recently the credit crunch has taken a whole new turn, and the way it is affecting the Irish mortgage market is of interest to anybody who has a mortgage. Today’s post will be about the changing position of first time buyers, the end of 100% mortgages.

First time buyers never had it easy, that’s my theory and here’s why: before stamp duty reform they had to pay for any property that was over €127,000 (an old £100,000 before the €uro came in) and that could not be borrowed, it had to be saved, during the time that prices were in that region the wages were much lower and stamp duty was a definite drawback to prospective home owners, on top of that they had to come up with a deposit of 10% which was also difficult because of the taxation system here. Then we all got a bit more prosperous, the Celtic tiger started to roar, cheap money became available and prices shot up. The old first time buyers were now owner occupiers basking in equity and that was fine, …

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First time buyers didn’t, don’t, and won’t ever have it easy.

Recently the credit crunch has taken a whole new turn, and the way it is affecting the Irish mortgage market is of interest to anybody who has a mortgage. Today’s post will be about the changing position of first time buyers, the end of 100% mortgages.

First time buyers never had it easy, that’s my theory and here’s why: before stamp duty reform they had to pay for any property that was over €127,000 (an old £100,000 before the €uro came in) and that could not be borrowed, it had to be saved, during the time that prices were in that region the wages were much lower and stamp duty was a definite drawback to prospective home owners, on top of that they had to come up with a deposit of 10% which was also difficult because of the taxation system here. Then we all got a bit more prosperous, the Celtic tiger started to roar, cheap money became available and prices shot up. The old first time buyers were now owner occupiers basking in equity and that was fine, …

Read More →