A picture speaks 256,000 words

The Surveyors Journal did an excellent info-graphic on how much it costs to build a house (with no land cost factored in)

It’s fairly clear that costs are not as simple as ‘cheaper land’. That is only one part of the equation, the other parts are things like local authority costs, Part V, VAT, expected profits, all of which are not directly linked to prime costs of the materials and labour that creates the construction part of the home.

Worth looking at twice before wondering why housing is so damn expensive.

 

 

Read More

TV3 Late Review, discussion on ‘a constitutional right to housing’

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.

Read More

Morning Ireland airs our idea to help the homeless

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

Read More

One of us isn’t a first time buyer, so can we get 90%?

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 …

Read More

A marginal rate of over 270%

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.

 

 

Read More

RTE Talking Money – AirBnB (making a house pay), 17th August 2015

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’.

Read More

A common tax myth about landlords

A tax myth that I have heard more than once has to do with landlords somehow price-gouging because they have a debt free property.

Most recently it was written in the Independent where it was stated by Aideen Hayden of Threshold accused landlords of ‘downright extortion’ because they have increased rents at a time when they have no mortgage on the property.

This is a logical fallacy, and a one worth debunking.

For a start, everybody has the right to charge prices and equally the state has a right to tax profits from various activities. In the case of landlords they have to make a tax return stating their profits and the more they make the more tax they pay.

In fact, the effective rate of tax on a landlords net profits is often about 65% or more. Don’t believe me? Play with this excel calculator and see for yourself. If you want to see how it works for a person who is mortgage …

Read More

RTE 1 O’Clock News: Housing crisis and what can be done in the budget to help

Today on the 1 O’clock News on RTE Radio 1 we were asked to consider things which the budget could do to help achieve some stability in the housing market.

We echoed the Construction Industry Federation for a call to end ‘Part V’ contributions as this is a 20% tax levied only on new homes which is meant to provide for social housing. This is a mistake, social housing is a society wide responsibility and should not be put only on the shoulders of new home buyers.

Other ideas included ending development levies and dropping the VAT rate while also being mindful of the rented sector.

Read More

Newstalk: Coleman at large ‘Economic recovery… Are we there yet?’

We discussed housing and the economy with Marc Coleman on his Sunday night show ‘Coleman at Large’. Other guests included Dan White from the Herald, Constantin Gurgiev of Trinity, Sheena Horgan who works in marketing and Karl Deeter.

Read More

RTE: Property bubbles discussed by Brian Lucey and Karl Deeter

Keelin Shanley was sitting in for Sean O’Rourke on the Today Show on RTE Radio 1. She had Brian Lucey and Karl Deeter on the show to discuss the issues with the property market in Ireland and in Dublin in particular where prices rose 22% in the last year.

Read More