Labour FTB deposit top up of €6000

handlemaster

http://m.independent.ie/irish-news/election-2016/labour-will-give-firsttime-buyers-6000-for-new-homes-34410089.html

First party off the block to try and bribe the first time buyer. We all know the public act out of their own interest first then the community after. Will this work ? Will it not just mean the property prices go up by the same amount ?

Pkiernan

Good news for sellers. Prices just go up by 6 grand.

PixelTrawler

A child would see this is just a bribe with our own money and wont benefit the ftb one bit.

handlemaster

Pkiernan wrote: »

Good news for sellers. Prices just go up by 6 grand.

Maybe thats the plan

dearg lady

This is the most idiotic thing I've read in a while. First time buyers seem to be in a pretty good position, why would they offer this handout. As other posters have said, this will just push up prices.

athtrasna

The problem in the market is rarely the first time buyer these days, it's the family in negative equity who bought a shoe box apartment in 2006 and can't afford to move up to a property suitable for for the three children they now have.

It's time to ditch ftb advantage and help more people.

PhoenixParker

They should give it to those selling one and two bed apartments and purchasing a larger abode, i.e. Encourage Trader uppers to actually trade up instead of becoming accidental landlords.

Also to anyone over the age of 55 who moves from a larger place to a smaller place.

That would do more to get the market moving then an Ftb incentive.

dearg lady

Agree! FTB probably in the best position they've been in years!

Santy2015

FTB don't need this incentive. I'm hoping to be a FTB soon and the new rules have given us a goal and will stick by it. We won't be buying over what we can actually afford and this would only lead to prices going up. 140k house now would immediately go up 20/30k if they implement the scheme

ted1

PixelTrawler wrote: »

A child would see this is just a bribe with our own money and wont benefit the ftb one bit.

It's similar to the SSIA, except it'll be cost neutral in that between stamp duty and VAT on new homes they'll get the money back

Cuddlesworth

dearg lady wrote: »

This is the most idiotic thing I've read in a while. First time buyers seem to be in a pretty good position, why would they offer this handout. As other posters have said, this will just push up prices.

A pyramid scheme needs a constant expanding group of new entrants. When that stops, the bubble collapses. Most, if not all of our current group of TD's still think that a house should be worth double what it was 5 years ago and strive to bring back those days. Probably because most of them are heavily invested into property themselves.

Charles Babbage

While I am no admirer of Labour, people seem a bit negative here. This is an SSIA like bonus for saving. it shouldn't affect the amount of money lent, which is 80% of the price, if financial regulation is properly done (a big if, granted).

Uncle Ben

ted1 wrote: »

It's similar to the SSIA, except it'll be cost neutral in that between stamp duty and VAT on new homes they'll get the money back[/quote

They'd get the stamp duty and vat anyway. Except that the price of the home wont increase by 6k. The only one that wins is the builder.

zl1whqvjs75cdy

I'm potentially one of the target market for this type of scheme. While it would be welcome for me individually I'm cautious of government intervention in the housing market. Their only role should be to build social houses, that's it.

Agent_47

Reminds me of this, "sur isn't that what you say at election time"

http://www.politics.ie/forum/labour/152507-labours-tesco-esque-ad-todays-papers-fine-gael-every-little-hurts-18.html

Greyian

Charles Babbage wrote: »

While I am no admirer of Labour, people seem a bit negative here. This is an SSIA like bonus for saving. it shouldn't affect the amount of money lent, which is 80% of the price, if financial regulation is properly done (a big if, granted).

If you have an extra €6,000 deposit, that would mean you could borrow an extra €24,000 on your mortgage (assuming the LTV figure was your limitation, not the LTI).

This will just make property more expensive.

Uncle Ben

donkeyoaty0099 wrote: »

I'm potentially one of the target market for this type of scheme. While it would be welcome for me individually I'm cautious of government intervention in the housing market. Their only role should be to build social houses, that's it.

My first house was bought with the 3k ftb that was given in the early 90s. I picked the house and just signed the ftb over to the builder. Only cash deposit required was an additional £100 on the day.
Id say the majority of buyers were in the same boat that day and we were all buying off the plans.

I cannot say for sure if the same homes would have been 3k cheaper if there were no ftb. But I'd hazard a guess and say they would have.

dearg lady

Charles Babbage wrote: »

While I am no admirer of Labour, people seem a bit negative here. This is an SSIA like bonus for saving. it shouldn't affect the amount of money lent, which is 80% of the price, if financial regulation is properly done (a big if, granted).

Firstly I don't think the market needs any more tinkering, it seems to hve finally settled down a bit.

Secondly, why single out first time buyers?

Uncle Ben

I was dealing with a woman last week who bought a house down here in the west for 220k during the boom.
The same house can be bought for less than 50k now.
No need for the taxpayer to subsidise ftb for homes costing less than a high spec car.

LiamoSail

There is no benefit to first time buyers through this scheme. They may get €6000 towards their deposit, however a Labour Government will fund this, along with their social welfare increases etc, through increased income taxes aimed at the mid level earners.

€6000 straight into the hand may seem attractive, but a Labour Government will cost you at least that through increased PAYE

caviardreams

Also at 1200 per year, it is going to be 5 full years before this money even starts coming through. The property market might look very different by then (prices and/or supply or or down significantly), as might people's financial situation (promotion, new job, redundancy etc.)

It's not going to make a bit of difference to the people out there who are hoping to buy in the next year or two.

gaius c

The only way to help first time buyers is cheaper houses.

Everything else is a way to help people other than first time buyers.

RainyDay

LiamoSail wrote: »

There is no benefit to first time buyers through this scheme. They may get €6000 towards their deposit, however a Labour Government will fund this, along with their social welfare increases etc, through increased income taxes aimed at the mid level earners.

€6000 straight into the hand may seem attractive, but a Labour Government will cost you at least that through increased PAYE

Have you read the manifesto then? I haven't heard any mention of increased taxes - quite the reverse in fact, with the commitment to reduce USC.

LiamoSail

RainyDay wrote: »

Have you read the manifesto then? I haven't heard any mention of increased taxes - quite the reverse in fact, with the commitment to reduce USC.

Apologies, I was referring to reality as oppose to Labour's pre-election promises

Muahahaha

Labour will be lucky to have 8 seats after the electiion, they're going to be an irrelevance anyway

athtrasna

You'll find the politics fora here http://www.boards.ie/vbulletin/forumdisplay.php?f=1657

Mod

mahoganygas

athtrasna wrote:

The problem in the market is rarely the first time buyer these days, it's the family in negative equity who bought a shoe box apartment in 2006 and can't afford to move up to a property suitable for for the three children they now have.

athtrasna wrote:

It's time to ditch ftb advantage and help more people.

I had the opportunity to buy a shoe box apartment in 2006. It barely suited my needs then and it was blatantly obvious it wouldn't suit my needs in the future.

I'm hoping to be a ftb buyer shortly. Why should greedy speculators who got burned get a helping hand ahead of me?

I'm ready to settle down with a partner and start a family. I want stability for my family in the form of my own 3 bed family home. I don't want to buy an apartment then flip it for a tidy profit.

I'm entering a highly unstable housing market created by feckless speculators. My income is taxed hugely to pay for a broken banking system.

People are quick to blame bankers for Ireland's woes, but not the morons who thought they could afford second and third houses.

I have little sympathy for a lot of the "accidental landlords".

RainyDay

LiamoSail wrote: »

Apologies, I was referring to reality as oppose to Labour's pre-election promises

So you're happy to take the promised top-up as gospel, while you ignore the rest of the promises because they don't suit your arguement. There's consistency for ya....

power101

Much better way would be to increase the local property tax for owners of multiple properties say 30-40+ or do the same as the UK and completely get rid of all interest relief on buy to let properties.

This will have the effect of getting many large holders of property to sell up and increase the supply on the market decreasing prices at the same time.

Long term what we need is more people able to buy property, more stable prices for the future and a large and competitive house market owned by mainly individuals in family homes rather than large foreign investment and hedge funds.

The J Stands for Jay

Pkiernan wrote: »

Good news for sellers. Prices just go up by 6 grand.

Didn't something like this happen about 10 years ago with the same price inflatiinary effect?

johnnyskeleton

McGaggs wrote: »

Didn't something like this happen about 10 years ago with the same price inflatiinary effect?

First time buyer exemption from stamp duty up to €317,500. The amount of apartments advertised for €317,500 or €317,499 the following day was uncanny!

L1011

This is basically an SSIA replacement. The inevitable FF attack will be hilarious as they were touting their SSIA "achievement" as a reason to vote for them recently - as they've nothing else in the past decade and a half to cite as an achievement.

zl1whqvjs75cdy

power101 wrote: »

Much better way would be to increase the local property tax for owners of multiple properties say 30-40+ or do the same as the UK and completely get rid of all interest relief on buy to let properties.

This will have the effect of getting many large holders of property to sell up and increase the supply on the market decreasing prices at the same time.

Long term what we need is more people able to buy property, more stable prices for the future and a large and competitive house market owned by mainly individuals in family homes rather than large foreign investment and hedge funds.

It'll also send rents through the roof as landlords will pass the costs onto tenants. With a shortage of rental units already I don't think that's the best course of action.

4ensic15

power101 wrote: »

Much better way would be to increase the local property tax for owners of multiple properties say 30-40+ or do the same as the UK and completely get rid of all interest relief on buy to let properties.

.

The abolition of interest relief in 1997 caused rents to double within about 18 months. That was only for new landlords purchasing. Great idea altogether!

spaceHopper

johnnyskeleton wrote: »

First time buyer exemption from stamp duty up to €317,500. The amount of apartments advertised for €317,500 or €317,499 the following day was uncanny!

I'd two sets of friends who bought around then they were getting sick of bidding on houses in the 270rang and ending up in bidding wars so they just offered 317499 and had done with it. At the time credit was so cheap it made no difference now one is trying to sell the same house for 180. Every time any government interferes in the market they screw the FTB and coin it for estate agents and developers

gaius c

4ensic15 wrote: »

The abolition of interest relief in 1997 caused rents to double within about 18 months. That was only for new landlords purchasing. Great idea altogether!

You're mixing up cause & effect. Rents increased because the number of people renting increased as folks who started working needed to rent before they could buy. Previously they simply emigrated and therefore did not require housing.

Michael D Not Higgins

They've done something similar in the UK albeit under stricter conditions.

You have to be a FTB. There's a cap for the property price (<250k outside of London). The bonus is 25% but you can only save 200/month with an opening balance of 1000 (i.e. to get 6k like in this scheme, you'd have to save for nearly 10 years, twice as long as this initiative). I've signed up for it here. It's a huge incentive and I was saving money for a deposit anyway.

4ensic15

gaius c wrote: »

You're mixing up cause & effect. Rents increased because the number of people renting increased as folks who started working needed to rent before they could buy. Previously they simply emigrated and therefore did not require housing.

I am not mixing cause and effect. landlords stopped buying and combined with an increase in the numbers seeking accommodation and those landlords who sold the rents doubled. Had the rent relief not been restricted landlords would have kept buying and that would have increased supply to keep up with the increasing demand.

gaius c

4ensic15 wrote: »

I am not mixing cause and effect. landlords stopped buying and combined with an increase in the numbers seeking accommodation and those landlords who sold the rents doubled. Had the rent relief not been restricted landlords would have kept buying and that would have increased supply to keep up with the increasing demand.

Again, you're rearranging the facts to suit your extremely narrow argument. Rent increased throughout the 90's, not just when the relief was abolished and you're ignoring much more important factors, like the 70's baby boomers moving out (not emigrating) and requiring accommodation as well as the beginnings of previous emigrants moving back to Ireland and large-scale immigration into the country. It's like looking at the formation of a hurricane and deciding that the colour of the water is a primary indicator as to the future strength of the cyclone.
Up till then, the only people who rented were students and social tenants and the existing housing stock was completely unsuited to this new market that appeared very quickly.

You're also blaming the churn of "landlords selling up due to high costs" but completely ignoring the much higher churn of "landlords selling up because the bank are telling them to". One of them is quantifiable. The other is totally imaginary.

P.S. You're making a total contradiction there with your 90's anecdote. Landlords were selling up while the rents were doubling?
"Hey Jimmy, rents are going up by 4% a month but I'm selling up because the government are being mean to me"
Methinks they might want to get better advisors.

4ensic15

gaius c wrote: »

Again, you're rearranging the facts to suit your extremely narrow argument. Rent increased throughout the 90's, not just when the relief was abolished and you're ignoring much more important factors, like the 70's baby boomers moving out (not emigrating) and requiring accommodation as well as the beginnings of previous emigrants moving back to Ireland and large-scale immigration into the country.

It's like looking at the formation of a hurricane and deciding that the colour of the water is a primary indicator as to the future strength of the cyclone.
Up till then, the only people who rented were students and social tenants and the existing housing stock was completely unsuited to this new market that appeared very quickly.

There were Section 23 developments coming on stream in the 90s and rents were quite reasonable until the Bacon Report. There were young workers renting as well as social and student tenants. Not everybody went to college or got a mortgage straight out of college.

gaius c wrote: »

You're also blaming the churn of "landlords selling up due to high costs" but completely ignoring the much higher churn of "landlords selling up because the bank are telling them to". One of them is quantifiable. The other is totally imaginary.

There are always going to be landlords selling for a variety of reasons. Some sell residential and buy commercial investments when they have enough equity. Some are under pressure others want to invest in another business. In normal times others come in to take their place. When it is not attractive to go in the supply will constrict.

gaius c wrote: »

P.S. You're making a total contradiction there with your 90's anecdote. Landlords were selling up while the rents were doubling?
"Hey Jimmy, rents are going up by 4% a month but I'm selling up because the government are being mean to me"
Methinks they might want to get better advisors.

[/QUOTE]

There is no cantradiction. there will always be some sales for the reasons given above. In the late 90s the replacements did not appear because of the interest relief ban. It had to reversed a couple of years later.

athtrasna

Mod note

Gaius c and 4ensic15 please take it to PM, personal to and fro tends to derail threads. Thanks.