Property Tax - suggestions

andrewdeerpark

Property Tax - merits & suggestions

Government considering property taxation at the moment my suggestions for a fair tax:

· Introduce a yearly tax rate of 1% of the value of individual’s 3rd and subsequent properties (if jointly assessed couple your 5th property).
· For assessment when you breach this limit you would have to get an auctioneer to value your entire property portfolio.
· The properties of the highest value in descending order, taxed at 1% of their value in excess of 2. You own 6 properties you pay tax of 1% a year on the 4 of highest value.
· This valuation would have to be amended every 3 years or earlier if an individual required, at your expense.
· Heavy fines including prison and repossession for undervaluation of property liable by both the person undertaking the valuation and the owner.
· Include development exclude farmland, if you convert land back to farmland from development land status it cannot be changed back again for 10 years.
· If you are owner of a company owning land then your 1% liability is divided by you share ownership.
· Each company you own or share property in is counted as 1 property; to stop individuals dodging by setting up companies and they owning the property.
· Includes commercial property and foreign properties.
· The buyer would set foreign property evaluation with major undervaluation punished by prison or if inherited and cashed in Revenue would seize the estate with fees.
- No upper limit you own 100 properties you pay tax on 98 of them.
- No tax relief of any kind available to reduce the bill

Still needs a bit of filling out but I think the land hoarding and property build-up by big developers has to stop for good and this is the best way as it does not punish middle class individuals with an investment property or holiday home.

The valuation work would give auctioneers much need revenue.

So as not to have double-taxation I would abolish stamp duty on almost all property transactions.

Discuss??

McSandwich

andrewdeerpark wrote: »

So as not to have double-taxation I would abolish stamp duty on almost all property transactions.

Discuss??

Should those who already paid stamp duty be exempt or pay a lower rate?

andrewdeerpark

Afraid not McSandwich as it would be a bureaucratic nightmate, key to my idea is simplicity.

A clean slate tax with a new constant revenue stream property taxation plan.

silverharp

andrewdeerpark wrote: »

Still needs a bit of filling out but I think the land hoarding and property build-up by big developers has to stop for good and this is the best way as it does not punish middle class individuals with an investment property or holiday home.

The valuation work would give auctioneers much need revenue.

I'd examine why was there/is there land hoarding in the first place, I'd wager it is down to a corrupt or inefficient planning sytem. Fix that and your reasoning for a tax might change?

Re the valuation work, here you are introducing more useless "hole digging and filling" into the system.

You may need to mention what your objective of this tax would be, is it purely to generate revenue?

If there was going to be a property tax I'd favour a straight forward tax per sq foot, it could be considered a green tax similar to cars, with various incentives built into it, all be it the horse has already bolted

ixoy

Is there any way for a property tax to work out that will avoid renters (generally those on the lower income to start with) being forced to pay for the owner's rent tax in the form of increased rents? Or will we merely hope that supply/demand means they won't get away with it?

mountainyman

Surely it has to include the PPR or it won't bring in the revenue we need.
We also need to get the Bacon report implemented (40 years later)

blast05

Think those suggestions look excellent. I think a flat tax accross the board on all properties would be very unjust on those people who have tried to take care of their futures by investing in a property or 2.

One thing re the tax, it was interesting to note that the FF parliamentary party were against it when they met yesterday - not surprising i guess given that the vast majority of them probably have multiple investment properties as would be the case accross all parties.

gurramok

Why 3rd properties?

Alot of people don't even have a 2nd property!

Suggestion - Tax the 300,000+ empties out there to get them on the market rather than leave them idle as a result of speculation

Agent J

andrewdeerpark wrote: »

Property Tax - merits & suggestions

Government considering property taxation at the moment my suggestions for a fair tax:

· Introduce a yearly tax rate of 1% of the value of individual’s 3rd and subsequent properties (if jointly assessed couple your 5th property).

The rest of your proposal is sound enough but it falls down at the 1st hurdle?

3rd property? 5th for a couple?
If a couple has 4 properties they should be paying some sort of tax on it.

The rest of us would like to have one piece of property let alone 3.

Anything after your principle primary residence should be subject to a tax.
The whole people buying investment properties is a red herring. If you can afford 2 properties then you can pay tax on the 2nd one.

newman10

Maybe now is the time to bring back domestic rates :eek: and the we will have an equal base so that everyone pays

thebman

I'm all for a tax on 2nd properties and any other additional properties people may have.

Houses are for living in, if you have additional ones and if your renting them, its a business.

You have things like Holiday Homes that might need to be taken into account but I don't there is a good way to differentiate that you could find out and they can rent their holiday home the rest of the year to pay the tax.

P. Breathnach

thebman wrote: »

Houses are for living in, if you have additional ones and if your renting them, its a business.

If a house is rented out, chances are that people are living in it.

Yes, renting property out is a business. Profits are subject to tax.

ManFromAtlantis

P. Breathnach wrote: »

If a house is rented out, chances are that people are living in it.

Yes, renting property out is a business. Profits are subject to tax.

dead right.........and this tax along with stamp duty paid helps the so called 'less fortunate'

ixoy

P. Breathnach wrote: »

If a house is rented out, chances are that people are living in it.

Yes, renting property out is a business. Profits are subject to tax.

Problem being though that if they owe 50e now a month for a property tax, they may just increase tenant's rate by 50e a month. Now the people paying for this are the renters, generally those on lower incomes.

P. Breathnach

ixoy wrote: »

Problem being though that if they owe 50e now a month for a property tax, they may just increase tenant's rate by 50e a month. Now the people paying for this are the renters, generally those on lower incomes.

I don't think that is true. The rental market is like the house sales market in that vendors already charge as much as the market will bear. At the moment, market conditions favour the buyer.

silverharp

P. Breathnach wrote: »

I don't think that is true. The rental market is like the house sales market in that vendors already charge as much as the market will bear. At the moment, market conditions favour the buyer.

Indeed just like most if not all of the tax breaks and mortgage relief etc. went into the pockets of developers on the way up.
You could argue that marginal landlords could be pushed over the edge by an additional tax that they cant pass on.

P. Breathnach

silverharp wrote: »

You could argue that marginal landlords could be pushed over the edge by an additional tax that they cant pass on.

You could, indeed. And, for many, it's the edge of a precipice: the resale value of their property might be far less than they paid, and well below what they borrowed.

Agent J

P. Breathnach wrote: »

You could, indeed. And, for many, it's the edge of a precipice: the resale value of their property might be far less than they paid, and well below what they borrowed.

Maybe im just being a hard hearted SOB but i hear the violins playing when i read stuff like that.

Landlords might have to sell some of their houses?
My heard bleeds for them. It really does. They were all ready and willing to roll in it during the good times and helped push the price of property to insane levels.

And the increase wont go on rent. It a renters market out there again at long bloody last....

Now sanity is begining to be restored to the market at long last and a % based tax on all property apart from principal residence would do a good deal in making sure we dont have such an unsustainable boom again

Godge

P. Breathnach wrote: »

You could, indeed. And, for many, it's the edge of a precipice: the resale value of their property might be far less than they paid, and well below what they borrowed.

Are they any different from people who invested their retirement lump sums in Anglo Irish Bank shares? If you invest in Government bonds, you get a low return to reflect the low risk. If you invest in property or shares you get a higher return to reflect the higher risk. If you were foolish/unlucky/stupid enough to invest at the wrong time, and you lose money, those are the breaks.

Godge

Valuation is a problem. The Valuation Office is years behind in assessing property for commercial rates - thought probably with the collapse some of the old valuations might be right!!

A better idea would be to have bands. A property valued between 0 and 500,000 euro carrying one tax, a value up to 1 million another, and so on. Valuation issues only arise at the margins between bands.

Using auctioneers is a good idea but a national tender would be the best value from the Exchequer's point of view.

Why exempt the first residence altogether? What about J.P. McManus' monstrosity? It would probably be the only tax he paid in Ireland anyway. Ditto Denis O'Brien and other tax exiles. You could exempt principal residences below a certain threshold and where income is also below a certain limit, this would protect pensioners in a long-standing family home, so long as the house wasn't too large.

Agree that stamp duty should be abolished. Revenue could be up to 2 or 3 billion even with a low tax.

Why exempt farms and land? Look at the 400m hole in the budget this year because of farmer's grants. The farming community get huge subsidies. Either they pay commercial rates like business do or they pay a property tax. I don't mind which.

P. Breathnach

Godge wrote: »

Are they any different from people who invested their retirement lump sums in Anglo Irish Bank shares? If you invest in Government bonds, you get a low return to reflect the low risk. If you invest in property or shares you get a higher return to reflect the higher risk. If you were foolish/unlucky/stupid enough to invest at the wrong time, and you lose money, those are the breaks.

I'm not contesting that. What I am contesting is the justice of hitting people in such a position with an extra tax -- most particularly, a flat-rate tax which does not allow for the fact that the property taxed might represent negative equity.

nesf

Godge wrote: »

Valuation is a problem. The Valuation Office is years behind in assessing property for commercial rates - thought probably with the collapse some of the old valuations might be right!!

A better idea would be to have bands. A property valued between 0 and 500,000 euro carrying one tax, a value up to 1 million another, and so on. Valuation issues only arise at the margins between bands.

Eh, bands still require you to go out and value each and every piece of property though which is the real problem with property taxes and why they can be so expensive to implement.

Godge

nesf wrote: »

Eh, bands still require you to go out and value each and every piece of property though which is the real problem with property taxes and why they can be so expensive to implement.

Not necessarily. You can rely on self-assessment initially. Only those properties whose valuation looks out of place relative to their postcode/locality (hurry up and introduce proper postcoes an Post) or is at the margin of the band needs to be valued.

You can also make sure that a property cannot be sold or probated without a proper sign-off on taxes paid by solicitor and auctioneer, with big penalties if underpaid.

If large scale valuations are needed put out to tender to big auctioneers (Remax or Sherryfitz would love the business) with appeals only to the Valuation Office. Out of the revenue, you could afford a few extra valuers!

nesf

Godge wrote: »

Not necessarily. You can rely on self-assessment initially.

I sincerely doubt that many people could accurately (even to within 10-20%!) value their homes at the moment given the current market. How do you distinguish the genuine understatements from the honest mistakes given that the market is in free fall and from all accounts the listed property prices are nothing close to the prices that properties are selling at.


I think a tax of an asset as a fraction of its value only makes sense with homogeneous products that are in liquid markets. Houses are neither of these things.

P. Breathnach

nesf wrote: »

I sincerely doubt that many people could accurately (even to within 10-20%!) value their homes at the moment given the current market.

I certainly have no idea what my house is worth -- never did, because it's a one-off to an idiosyncratic plan. I know its rateable valuation, though, as the local authority gave me notice of it, even though rates had already been abolished when it was built.

Is is still the practice to assign valuations to domestic property?

nesf

P. Breathnach wrote: »

Is is still the practice to assign valuations to domestic property?

I doubt it but it's possible that they didn't fire the guys whose job it was to rate places after they abolished...

andrewdeerpark

Just to clarify my reasoning on the 3rd property (5th for a couple) threshold is:
- Most people with 2 homes are not professional investors they are either
a) Holiday home buyers either in Ireland or abroad, who were sucked in on "free" foreign trips etc
b) The last poor fools who bought into the buy-to-let investment idea and are now struggling with that investment.

The main aim of any property tax has to be to get revenue from the professional investor who up to now has had an easy time of it tax wise. If they have invested and sold over the past 10 years they have made serious money.

The second aim (excluding primary residence) is to stop a future property bubble by making buying houses for investment less attractive as an investment giving the first time buyers and location change transactions priority, over time the mobility of the workforce should improve.

I do not believe rents would go up because of the current oversupply coupled with the return of large numbers of eastern European workers so now is the time.

The postcode valuation is another possibility plus instead of actual property numbers you could use a self assessment set value. So say if your property assets exceeded .5 million you pay property tax, again all good ideas.

Any tax must be based on property value for it to be fair excluding those individuals who did not profit buying the boom but are not "asset rich and cash poor now".

funky.monkey

Any property tax is very unfair, as it doesn't take account of peoples ability to pay. for example two families on the same street - one is a dual income couple with no children earning 100,000 a year together. For them 1000 euros a year property tax is 1% of their income. In the same street a one income family bringing in 25,000 a year and having 3 children. Under a property tax they both pay the same rate, but 1000 means a heck of a lot more to the family than to the dual income couple.
I'm a low wage worker (and union member) and I would much rather pay 50% income tax than any property tax, as I know if I lose my job, I don't have to pay income tax, but under a property tax, I'd still have to pay it even if I have no income
.

mountainyman

The lwo income family sells their house and moves. A property tax is a highly fair tax and generally in Europe doesn't include the PPR.

flanzer

Does anyone know was it introduced yesterday? I heard something to the effect, 'there will be a tax on second homes' but was quickly brushed aside to matters concerning the public sector.

Well was it introduced or not and how much was it? Or is Cowen still looking after his buddies in property development?

ManFromAtlantis

ya, heard something about property tax, but WHAt was he saying about it????????

Uncle Junior

A lot of kites have been floated recently, including the Central Bank Governor suggesting a tax of €1,000 on the 1.7million houses in the country. It will be interesting to see what the Commission on Taxation reports back with in regard to property tax. It's also interesting to note all "not on PPR" comments, and claims that property tax is not levied usually on principal residences. Friends of ours living in New Jersey pay about $40,000 a year in property tax on a house worth about $1.5million (this is based on the square footage of the house which is an embarrassing 6,500 square feet) while relatives in a small town in Yorkshire pay £1,500 a year for a small 3-bedroom terraced house (plus another £500 each year in water rates).:eek:

foundation10

Abolish stamp duty for a period of 5 years. The loss of revenue from this which be offsett from the VAT receivable from new property transactions whenever the market turns. Residential property tax of €1000 is a non runner. Property tax should be levied on all investment property and all property related tax reliefs should be abolised immediately

blast05

Residential property tax of €1000 is a non runner. Property tax should be levied on all investment property

Why not on principal primary residence ?

flanzer

blast05 wrote: »

Why not on principal primary residence ?

With more and more home owners losing their jobs, it's bad enough for them to meet their daily needs and meet mortgage repayments without having to pay an annual property tax also

P. Breathnach

flanzer wrote: »

With more and more home owners losing their jobs, it's bad enough for them to meet their daily needs and meet mortgage repayments without having to pay an annual property tax also

So it's okay to hit owners of investment properties when rents are falling and many properties are lying empty?

It's simplistic to regard all owners of investment properties as wealthy people with assets worth millions. A proportion of them might be. But many own a single property or two properties, are paying on mortgages, and have negative equity. For some, the property is their personal pension plan, and their income is much reduced.

Yes, if somebody is unemployed, there is a case to be made for lessening the burden of any property tax. But, happily, most of us are not unemployed.

gurramok

P. Breathnach wrote: »

So it's okay to hit owners of investment properties when rents are falling and many properties are lying empty?

It's simplistic to regard all owners of investment properties as wealthy people with assets worth millions. A proportion of them might be. But many own a single property or two properties, are paying on mortgages, and have negative equity. For some, the property is their personal pension plan, and their income is much reduced.

So what? Can't believe you posted this.

Investment properties are exactly what they are, investments. They go up and down and are not guaranteed.
This thing about pension is a con, they were duped through their own ignorance and bought into the bubble to make their money.

My pension from work is down in value and may end up going up and down many times before retirement, i know the risk, same with property.

Many people out there do not have a single property and end up paying rent for years. Ask them if they have any sympathy for Buy To Letters who froze them out of the market for years driving up prices.

Leave the renters market to professional landlords, not cowboys out to make a quick buck short term and those who treat property as a pension when in fact it should not be.
Roll on that property tax. Professional landlords would have done their sums to have the ability to pay. Those that cannot afford to pay a tax never mind a mortgage on that zillionth property they 'own', you cannot afford them and are living beyond your means.

P. Breathnach

gurramok wrote: »

So what? Can't believe you posted this.

Why ever not? I'm dealing with facts. I know people who have retired from business, sold the shop, and invested in rental property.

Investment properties are exactly what they are, investments. They go up and down and are not guaranteed.
This thing about pension is a con, they were duped through their own ignorance and bought into the bubble to make their money.

Rather like people who bought shares in the banks, then.

My pension from work is down in value and may end up going up and down many times before retirement, i know the risk, same with property.

You have an investment that falls and rises in value; so have they. Is yours in some way more virtuous?

Many people out there do not have a single property and end up paying rent for years. Ask them if they have any sympathy for Buy To Letters who froze them out of the market for years driving up prices.

So one buyer is more deserving than another? Look at it another way: if a house is let, it means that somebody has a place to live.

Leave the renters market to professional landlords, not cowboys out to make a quick buck short term and those who treat property as a pension when in fact it should not be.

What's a "professional landlord"? To me, it means a person who rents out property in the hope of making a net income. That can be an income for one's retirement, and I don't see any reason why "it should not be". And then you conflate it with people why buy property to make capital gains in the short/medium term. People who seek profit rent as their retirement income are typically not planning to realise the capital in a property.

Roll on that property tax. Professional landlords would have done their sums to have the ability to pay.

That's a reckless assertion. Many people have done their sums and find that the situation has changed enormously. They are now doing new sums with a whole new set of variables, and have far less scope to pay than they envisaged 12-18 months ago.

Those that cannot afford to pay a tax never mind a mortgage on that zillionth property they 'own', you cannot afford them and are living beyond your means.

I am sure that the large, probably overwhelming, majority of owners of rental homes have one or two properties.

I'm not advocating giving them money. I'm simply arguing that there is little justice in levying a charge on them as a category while exempting the rest of us.

[Declaration of lack of interest: I do not own a rental property; I am (along with Herself) a home owner.]

gurramok

To sum up your post.

Those people you know 'invested', thats the key word. They knew the risks of getting involved in property. It either works out or now.

A buyer buying a home to live in deserves more sympathy on the tax front than an investor who is out to make money, understand?

Professional landords will not have huge mortgages in my opinion and they give a hoot about their tenants.
Its a business to them, they treat their customers well to get that guaranteed income without vacant periods.

Unike the unprofessional ones(BTL's) who have no idea of how the rental market works. They base their asking rents on their ability to pay their huge mortgages obtained during the bubble years rather than market demand. (Lots of anecdotal evidence of interest rate rises passed onto tenants in '07/08, search rising rents issue in google/boards)

I'm not advocating giving them money. I'm simply arguing that there is little justice in levying a charge on them as a category while exempting the rest of us.

As i said above, the rest of us did not treat our homes(PPR's) as profit making commodities. Investors in property are just that, investors. A whole different ball game, its risk taking and there is no guaranteed profit at the end hence relying on it as a pension is insane.
At the mo, there is an excess supply of rental property. Its an ideal time to levy a tax to weed out the ones living beyond their means whose debt is serously shaky for the banks and bring stability to the market where that stability is professional landlords.

P. Breathnach

gurramok wrote: »

To sum up your post.

Those people you know 'invested', thats the key word. They knew the risks of getting involved in property. It either works out or now.

Sure, every investor takes a risk. But the imposition of an extra tax changes the risk, and you are advocating doing that at a time when the market has already moved to worsen their position.

A buyer buying a home to live in deserves more sympathy on the tax front than an investor who is out to make money, understand?

No, I don't understand. And I don't think that is evidence of stupidity on my part.

Professional landords will not have huge mortgages in my opinion and they give a hoot about their tenants.
Its a business to them, they treat their customers well to get that guaranteed income without vacant periods.

That is a really strange definition of of a professional landlord. There are good landlords, and there are bad landlords, and many between the extremes. And that generalisation applies to wealthy landlords and relatively small-scale operators.

Unike the unprofessional ones(BTL's) who have no idea of how the rental market works. They base their asking rents on their ability to pay their huge mortgages obtained during the bubble years rather than market demand. (Lots of anecdotal evidence of interest rate rises passed onto tenants in '07/08, search rising rents issue in google/boards)

There are good economic reasons why rents might rise when interest rates rise.

As i said above, the rest of us did not treat our homes(PPR's) as profit making commodities.

I am a fully-fledged member of "the rest of us". It doesn't give me any sense of virtue.

Investors in property are just that, investors. A whole different ball game, its risk taking and there is no guaranteed profit at the end hence relying on it as a pension is insane.

Hyperbole. Yes, there is uncertainty, but it is not insane to invest in property in the hope of generating long-term income.

At the mo, there is an excess supply of rental property. Its an ideal time to levy a tax to weed out the ones living beyond their means whose debt is serously shaky for the banks and bring stability to the market where that stability is professional landlords.

What's this about weeding them out? Do you want to force large numbers of relatively small investors to take a capital loss, and then flood the housing market at a time when there is already a huge oversupply in that market?

gurramok

Yes, there is uncertainty, but it is not insane to invest in property in the hope of generating long-term income.

It seems you cannot differentiate between using a property as a business and using a property as a pension. (the latter is highly foolish and the lazy mans way of avoiding working for a living)
Its better to have an over supply to make prices affordable for everyone than to have an undersupply driving prices sky high.
I'm not forcing them They obviously cannot afford those properties if they cannot even afford a tax of €1000 pa which is equivalent to just under one months vacant period , they are a factor in destabilising the banking system. Of course if they go bust, the sales market will stabilise even further, that's good news.

We don't want a bubble scenario again.

P. Breathnach

gurramok wrote: »

It seems you cannot differentiate between using a property as a business and using a property as a pension. (the latter is highly foolish and the lazy mans way of avoiding working for a living)

No. I will not make such a spurious differentiation. It's nonsense to say that using a property as a pension is a lazy man's way of avoiding working for a living (or indeed woman's). Any pension scheme is way of using accumulated assets to generate income.

Its better to have an over supply to make prices affordable for everyone than to have an undersupply driving prices sky high.

What's that got to do with anything I said?

They obviously cannot afford those properties if they cannot even afford a tax of €1000 pa which is equivalent to just under one months vacant period

In economics, everything is decided at the margin.

they are a factor in destabilising the banking system.

So are lots of other categories of borrower. But I don't blame most borrowers: I blame the lenders as a collective.

Of course if they go bust, the sales market will stabilise even further, that's good news.

We don't want a bubble scenario again.

What do you mean by "stabilise"? The market is falling fast; there is already oversupply; you are in favour of forcing more supply onto that falling market. That would depress prices even further, leading to greater levels of realised negative equity and a consequent increase in defaults on bank loans, further problems for the banks, possibly a need for yet more capital injection...

This is an economics forum, not an "I really dislike people who bought property as investment" forum.

blast05

A buyer buying a home to live in deserves more sympathy on the tax front than an investor who is out to make money, understand?

What about the tens of thousands of holiday homes that are unoccupied bar a few weeks of the year ?
These aren't purchased as investments - these are built or bought for enjoyment. If we go down the route of putting an extra tax on something people use for enjoyment then where do you stop - vintage cars, cruise boats on the Shannon, high end racing bikes (both motor and cycling) .... etc etc etc. And what about holiday homes owned by foreigners - how do you implement a scheme whereby the owner pays a grand a year ?
And also, what about an investor in the stock exchange - someone who has invested in shares rather than buying a house? Exact same principles as buying an investment property applies and yet they are only subject to capital gains tax, exact same as the profit on investment properties.

It seems you cannot differentiate between using a property as a business and using a property as a pension. (the latter is highly foolish and the lazy mans way of avoiding working for a living)

"Avoiding working for a living" ?? I can't even begin to think what sort of "never never" land logic you are employing there

Professional landords will not have huge mortgages in my opinion and they give a hoot about their tenants.

With all due respect, but you really don't have a clue. Any "professional" landlord who has bought a property in the last 10 years (whatever a professional is in this case - somebody who has multiple properties i guess? or is it someone who bought their investment properties prior to the Celtic tiger ? - perhaps you could enlighten us) will have borrowed a high enough percentage of the price to ensure there is little to no tax liability on the rental income. If the market changes for the worse shortly after they buy it or if government policy changes then they find themselves in a negative position - as would be the case for any landlord (not just professional) who has bought in the lst 3 to 5 years.

gurramok

To the both of you.
Unprofessional landlords in my opinion are those that are overstretched as living beyond their means, in for a quick buck(like flippers) rather than providing a service for the long term to their tenants.
Having multiple properties is not an issue, having huge mortgages is not a big issue no matter when they were purchased either(yes, they do write off mortgage interest against tax) as long as they can afford them and treating it like a business with customer care(tenants) at heart.
I go back to the point of a €1,000 tax. If a landlord cannot afford that, he/she should not be in the business as that is about one months vacancy period. God help a landlord who falls back on a mortgage payment when their property is vacant for only a month!

What do you mean by "stabilise"? The market is falling fast; there is already oversupply; you are in favour of forcing more supply onto that falling market. That would depress prices even further, leading to greater levels of realised negative equity and a consequent increase in defaults on bank loans, further problems for the banks, possibly a need for yet more capital injection...

This is an economics forum, not an "I really dislike people who bought property as investment" forum.

Hold on there. I have two associates who own properties who are in it for the long haul and treat their tenants with respect. One bought pre-bubble and the other during the bubble. Negative equity does not bother them as long as they afford the mortgage. They will end up selling if they cannot afford it, simple as.

Its tough if certain people bought at the peak in 2006. Nobody put a gun to their heads to take out huge mortgages they cannot afford. They should of done some research into the biggest financial transaction of their lives just like my associates did. I don't have a 'dislike for property investors' so your assertion is mistaken.

I have issue with those who are overstretched, they are a danger financially to the banks themselves. They should get out as they are an unstabilising force to the property market. Them exiting will do wonders to both their own lives and the banks as well as the market.

blast05 wrote:

And also, what about an investor in the stock exchange - someone who has invested in shares rather than buying a house? Exact same principles as buying an investment property applies and yet they are only subject to capital gains tax, exact same as the profit on investment properties.

Investors are investors, they know the risks. Here, your treating property like shares, they are different. Investing in shares is investing in a company creating a strong private sector hence providing stability for the economy which should be No. 1 on the list for any investor, not property.
Investing in property en masse which happened here has been a huge destabilising force and it should be discouraged by way of a tax so only real professionals can enter the market who know what they are doing unllike the BTL's

Flippers/speculators - tax them out of the heavens, they deserve no sympathy.
Holiday homes - we'll have to figure out a way of determining if a house is one. Yes they should be taxed too. If one can afford 2 homes, they can well afford a tax on the 2nd one just like in the most of the EU.

P. Breathnach

gurramok wrote: »

Unprofessional landlords in my opinion are those that are overstretched as living beyond their means, in for a quick buck(like flippers) rather than providing a service for the long term to their tenants.

This specious definition is a load of bollocks that you seem to apply selectively, even capriciously. Why is somebody who invests in rental property as a pension scheme unprofessional?

I go back to the point of a €1,000 tax. If a landlord cannot afford that, he/she should not be in the business as that is about one months vacancy period. God help a landlord who falls back on a mortgage payment when their property is vacant for only a month!

More bollocks. You simply ignore what I said about the marginal effect.

Hold on there. I have two associates who own properties who are in it for the long haul and treat their tenants with respect. One bought pre-bubble and the other during the bubble. Negative equity does not bother them as long as they afford the mortgage. They will end up selling if they cannot afford it, simple as.

Its tough if certain people bought at the peak in 2006. Nobody put a gun to their heads to take out huge mortgages they cannot afford. They should of done some research into the biggest financial transaction of their lives just like my associates did. I don't have a 'dislike for property investors' so your assertion is mistaken.

I have issue with those who are overstretched, they are a danger financially to the banks themselves. They should get out as they are an unstabilising force to the property market. Them exiting will do wonders to both their own lives and the banks as well as the market.

Yet more bollocks. The quality of service provided by a landlord is probably unrelated to that landlord's debt situation other than in the most extreme cases where a landlord is simply unable to afford necessary repairs to a property. Some of the worst landlords I know of are a long time in the business, have a number of properties, and little or no debt -- the sort who seem to meet your definition of "professional". I also know good landlords who satisfy those criteria.

Investors are investors, they know the risks. Here, your treating property like shares, they are different. Investing in shares is investing in a company creating a strong private sector hence providing stability for the economy which should be No. 1 on the list for any investor, not property.
Investing in property en masse which happened here has been a huge destabilising force and it should be discouraged by way of a tax so only real professionals can enter the market who know what they are doing unllike the BTL's

The past is unchangeable.

Flippers/speculators - tax them out of the heavens, they deserve no sympathy.

Hang on a moment: you're changing your ground. You have also attacked those landlords that you, by reference to some yardstick that the rest of us can't see, categorise as "unprofessional", but which seems to apply to people who invest as a way of having an income in retirement.

You cannot tax people on their motives, only on their actions. It is extremely distasteful to me that you arrogate to yourself some sort of moral authority that allows you select between investors and heap opprobrium on some but not on others -- where nobody has broken any law and where your criteria are idiosyncratic.

Holiday homes - we'll have to figure out a way of determining if a house is one. Yes they should be taxed too. If one can afford 2 homes, they can well afford a tax on the 2nd one just like in the most of the EU.

If you want to follow the example of most of the EU, then you should agree to taxing all homes.

I don't know why I am bothering. You ignore what I say and repeat the same trite arguments.

Fighting Irish

thebman wrote: »

I'm all for a tax on 2nd properties and any other additional properties people may have.

Houses are for living in, if you have additional ones and if your renting them, its a business.

You have things like Holiday Homes that might need to be taken into account but I don't there is a good way to differentiate that you could find out and they can rent their holiday home the rest of the year to pay the tax.

No

Property taxes are stupid

P. Breathnach

Fighting Irish wrote: »

Property taxes are stupid

Would you care to explain why?

gurramok

P. Breathnach wrote: »

This specious definition is a load of bollocks that you seem to apply selectively, even capriciously. Why is somebody who invests in rental property as a pension scheme unprofessional?

To repeat, there is no guaranteed income at the end of the day. That pension is screwed if there is no tenant there. How is a vacant building going to generate money in retirement?

Yes its a risk, but its a huge risk. It is a lazy mans way out of investing as it does not generate wealth, thats my opinion, i don't care if you like it or not.

P. Breathnach wrote: »

More bollocks. You simply ignore what I said about the marginal effect.

Marginal affect? Don't you realise that mortgages are 35 yr things these days. A tax will have to be paid every year for that property for one months rent. If an investor cannot afford that small sum, they should not be in property.

Yet more bollocks. The quality of service provided by a landlord is probably unrelated to that landlord's debt situation other than in the most extreme cases where a landlord is simply unable to afford necessary repairs to a property. Some of the worst landlords I know of are a long time in the business, have a number of properties, and little or no debt -- the sort who seem to meet your definition of "professional". I also know good landlords who satisfy those criteria.

We agree to disagree. I have issue with BTL's mostly, they are unprofessional. Of course there would be the odd few cowboy landlords old style, its only in the bubble that we had tens of thousands buying property as an investment each year who never should have got involved, that never happened in previous decades hence they are a huge risk to the stability of the economy.

The past is unchangeable.

Lets not make it happen again. Investing in property should be a last resort. It makes sense, lets invest in companies who actually generate wealth.

Hang on a moment: you're changing your ground. You have also attacked those landlords that you, by reference to some yardstick that the rest of us can't see, categorise as "unprofessional", but which seems to apply to people who invest as a way of having an income in retirement.

I was responding to blast05's addition of holiday homes into the equation. Having a holiday home is a luxury not an essential. The vast majority do not a holiday home. Services have to be provided to that holiday home on the coast of Galway for example, a tax should be paid by the owner as it costs alot to bring services to that remote holiday home.

You cannot tax people on their motives, only on their actions. It is extremely distasteful to me that you arrogate to yourself some sort of moral authority that allows you select between investors and heap opprobrium on some but not on others -- where nobody has broken any law and where your criteria are idiosyncratic.

Are you defending Flippers/speculators??

They were wreckless. Ask any PPR buyer in the last 7 years of their opinion of them.

If you want to follow the example of most of the EU, then you should agree to taxing all homes.

Yes i do. Every other country has a property tax of some sort. Here in good ole Ireland, it needs all the poltical parties to come on board for it to make it work as some Irish people do not wish to pay for services to their property.

Fighting Irish

P. Breathnach wrote: »

Would you care to explain why?

Because in theory you'd never own your house. If you slaved away for years to buy a big house you'd have to keep slaving away for the rest of your life just to pay the property tax. Also bringing in a property tax will be grand if its 1%, but then it will rise when some politiction thinks he needs some new flowers down along the side of the m50. Aren't prop taxes in america not fairly high now? I'd bet they started out low

Fighting Irish

lol @ people wanting more taxes

gurramok

Fighting Irish wrote: »

Because in theory you'd never own your house. If you slaved away for years to buy a big house you'd have to keep slaving away for the rest of your life just to pay the property tax. Also bringing in a property tax will be grand if its 1%, but then it will rise when some politiction thinks he needs some new flowers down along the side of the m50. Aren't prop taxes in america not fairly high now? I'd bet they started out low

Then please explain how services would be paid for your house? (Rubbish, sewerage, water, police, fire brigade, council cleaning on your street/town, repairing roads etc)

Hint: Council tax in the UK is used for the above