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Property Valuation

  • 17-08-2016 10:12am
    #1
    lawred2
    Registered Users, Registered Users 2 Posts: 24,557 ✭✭✭✭


    Bought a new build last year. Getting it revalued for a remortgage.

    Everyone buying a new house pays VAT on the purchase and it is the ex VAT price that gets recorded in the PPR.

    Does that mean that anyone buying a new build is effectively/technically in negative equity as soon as the VAT portion goes to the government? Or, assuming no swings in the wider property market, is the value of the house what the buyer paid for it? i.e. including VAT


Comments

  • #2
    L1011
    Registered Users, Registered Users 2 Posts: 71,112 ✭✭✭✭L1011


    Most people require a 20% deposit, VAT is 13.5% so they're not in NE ;)

    It would be rare to sell a nearly new house for much less than its VAT inclusive new price.


  • #3
    lawred2
    Registered Users, Registered Users 2 Posts: 24,557 ✭✭✭✭lawred2


    L1011 wrote: »
    Most people require a 20% deposit, VAT is 13.5% so they're not in NE ;)

    It would be rare to sell a nearly new house for much less than its VAT inclusive new price.

    I'd hope not.. thanks.

    Why is the Vat exclusive price recorded in the PPR then?


  • #4
    L1011
    Registered Users, Registered Users 2 Posts: 71,112 ✭✭✭✭L1011


    lawred2 wrote: »
    I'd hope not.. thanks.

    Why is the Vat exclusive price recorded in the PPR then?

    Because the PPR records the amount stamp duty was paid on.


  • #5
    lawred2
    Registered Users, Registered Users 2 Posts: 24,557 ✭✭✭✭lawred2


    L1011 wrote: »
    Because the PPR records the amount stamp duty was paid on.

    fair enough


  • #6
    antoinolachtnai
    Registered Users, Registered Users 2 Posts: 9,815 ✭✭✭antoinolachtnai


    lawred2 wrote: »
    fair enough

    VAT is a thing for new houses. when you resell your house VAT does not arise. The price is supposed to have all the VAT factored in. You would expect the vat inclusive price of a new house to be more or less the same as the price of an adjacent house which is one day old and being sold as second hand.

    The whole thing gets a bit technical and there are various manoeuvres that can be done (principally, registering for VAT, claiming the purchase VAT back and using it to cover most of the deposit - note I recommend you not do this -).

    But basically, no VAT ON a new house does not instantly depreciate by ten percent when you but it


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