2017-21 help to buy scheme - megathread. All help to buy discussion here please

sibersha · 14-10-2016 3:48pm

Question regarding Help to Buy scheme:

Have signed building contract post July 19th and should be drawing down shortly and are receiving an 85% mortgage.

As 1st time buyers of a new build, should we expect a rebate in January 2017 in form of a lump sum? Considering we have collectively paid 5% of the value in PAYE over the last 4 years. Or will it be a tax credits/tax relief?

Thanks

Alter_Ego · 14-10-2016 6:06pm

sibersha wrote: »

Question regarding Help to Buy scheme:

Have signed building contract post July 19th and should be drawing down shortly and are receiving an 85% mortgage.

As 1st time buyers of a new build, should we expect a rebate in January 2017 in form of a lump sum? Considering we have collectively paid 5% of the value in PAYE over the last 4 years. Or will it be a tax credits/tax relief?

Thanks

It's probably best to contact Revenue with the question

Stheno · 14-10-2016 6:14pm

hawkeye_bmr wrote: »

We signed on 19th, so just scraping thru, house is down on ppr as new build, but the 4yrs previous PAYE is gonna be the next hurdle I can see..

Having returned home from Oz may 2015 after 3yrs away, we both have only 1 full year of PAYE, around 3k, so I'm assuming that that's all we'd get even tho 5% would be 7k~

Wondering what happens in this situation?

You only get back the tax you've paid

annoyedgal · 15-10-2016 8:55pm

Probably know the answer already but here it goes. I bought a house before I got married. In my name only. Looking to trade up, could my husband be entitled to the first time buyers grant for new builds if he buys next house in his name only? We would be selling my house to fund the move. Thanks in advance

The_Conductor · 15-10-2016 9:03pm

Short and simple answer is- no.
Once either of a couple who are buying are not first-time-buyers- the couple as a whole, are not first time buyers.
Sorry.

annoyedgal · 15-10-2016 9:15pm

Bummer.....thanks!

quote="The_Conductor;101361492"]Short and simple answer is- no.
Once either of a couple who are buying are not first-time-buyers- the couple as a whole, are not first time buyers.
Sorry.[/quote]

caviardreams · 15-10-2016 10:30pm

annoyedgal wrote: »

Probably know the answer already but here it goes. I bought a house before I got married. In my name only. Looking to trade up, could my husband be entitled to the first time buyers grant for new builds if he buys next house in his name only? We would be selling my house to fund the move. Thanks in advance

Also I am pretty sure if you are married the family home has to be in both names.

Prismatic · 18-10-2016 8:21pm

Anyone planning to borrow more than needed inorder to avail of the new help to buy scheme?

For example you only need to borrow 60% of the purchase price, but instead borrow 80% plus and pay off a lump sum next year when you receive the grant.

You don't need help from the government but why not take it since they are offering?

yesap · 18-10-2016 8:35pm

Prismatic wrote: »

Anyone planning to borrow more than needed inorder to avail of the new help to buy scheme?

For example you only need to borrow 60% of the purchase price, but instead borrow 80% plus and pay off a lump sum next year when you receive the grant.

You don't need help from the government but why not take it since they are offering?

Is it not on the value of property rather than value of loan, makes no difference what lump sum you are putting towards it?

Prismatic · 18-10-2016 9:17pm

yesap wrote: »

Is it not on the value of property rather than value of loan, makes no difference what lump sum you are putting towards it?

That's what I said. Value of property/purchase price. One of the rules is you need to borrow 80% of the price of the property. I'm wondering if many people are borrowing 80% but in reality need less and are borrowing more just to avail of the grant.

If you borrow 75% of the property value you get nothing for example.

If you borrow 80% you get 5% of the value back from the government up to 400k.

Pay off a lump sum from the rest of savings plus government grant and you are in a much better position than just borrowing the 75%.

Ayuntamiento · 18-10-2016 9:46pm

I suppose you could only do that if you'll still qualify for the larger mortgage required based on the CB's 3.5 times your income rule. I know a lot of couples with modest enough combined salaries (<80k) who are only able to afford Dublin property because they have really large deposits (made up of savings and gifts).

Prismatic · 18-10-2016 10:02pm

Ayuntamiento wrote: »

I suppose you could only do that if you'll still qualify for the larger mortgage required based on the CB's 3.5 times your income rule. I know a lot of couples with modest enough combined salaries (<80k) who are only able to afford Dublin property because they have really large deposits (made up of savings and gifts).

Or be eligible for an exemption of the 3.5x income rule.

One of the worst aspects of the the new scheme is that the low earners are excluded as their deposits have to exceed 20% as you say.

My question was referring to the other end of the market, people who don't need it and who would not qualify unless they borrow more than they would have otherwise if the 80% rule was not there.

zl1whqvjs75cdy · 19-10-2016 7:58pm

I see they are tweaking this a bit.

http://www.rte.ie/news/business/2016/1019/825297-measures-expectto-close-vulture-fund-tax-loopholes/

Max 70 % ltv now.

Pedro32561 · 19-10-2016 7:59pm

http://www.independent.ie/irish-news/government-to-announce-changes-to-the-firsttime-buyers-scheme-35144774.html

I see that the threshold to qualify is now being lowered to 70% LTV. Good news particularly for those with self builds.

RandomAccess · 19-10-2016 8:02pm

Lads when are the full details published?

zl1whqvjs75cdy · 19-10-2016 8:03pm

RandomAccess wrote: »

Lads when are the full details published?

Finance bill tomorrow me thinks. So them.

stickman22 · 19-10-2016 8:47pm

Just read that there is going to be a change to the FTB grant announced tomorrow & the treshold has been reduced to 70% from 80%, this is huge news for us as we are buying a new build due to be ready in the Spring & the max the bank would give us was a 76% mortgage, we were gutted to say the least but this is great news for us.
However does anyone know how you apply for it, I can't find anything online. Hopefully this helps other buyers too.

Joebloggs:37 · 19-10-2016 9:07pm

stickman22 wrote: »

Just read that there is going to be a change to the FTB grant announced tomorrow & the treshold has been reduced to 70% from 80%, this is huge news for us as we are buying a new build due to be ready in the Spring & the max the bank would give us was a 76% mortgage, we were gutted to say the least but this is great news for us.
However does anyone know how you apply for it, I can't find anything online. Hopefully this helps other buyers too.

Hi Stickman, explain the treshold to me in relation to the first time buyers scheme?

Monife · 19-10-2016 9:31pm

Pedro32561 wrote: »

http://www.independent.ie/irish-news/government-to-announce-changes-to-the-firsttime-buyers-scheme-35144774.html

I see that the threshold to qualify is now being lowered to 70% LTV. Good news particularly for those with self builds.

Not good news at all. That's a complete joke. It's supposed to help people who can't achieve the max 10-20% deposit, this just further helps the people who already have the money for a decent deposit.

athtrasna · 19-10-2016 9:31pm

Rene Microscopic Igloo wrote: »

Finance bill tomorrow me thinks. So them.

More to be added at committee stage so not even all the info tomorrow. Word is that the top price level may be reduced to 400K with more expensive properties not qualifying

riclad · 19-10-2016 10:33pm

this means say you are borrowing 70k, house cost is 100k, you,ll still qualify for the ftb grant .
so 70 per cent loans are now covered by the scheme .
70 per cent of house cost .

zl1whqvjs75cdy · 19-10-2016 10:48pm

So is the swap from 80% to 70% a good thing. Or not?

ixus · 19-10-2016 10:56pm

CB intervened, they saw it as punishing savers. Average FTB is 78.5% mortgage. Reducing the cap could be interesting. Say cap is at 400k. Does builder or second hand house seller with price at 415k now reduce? Maybe not, but it may result in the 400k cap being a magnet for all house prices in that region.

RandomAccess · 19-10-2016 11:46pm

donkeyoaty0099 wrote: »

So is the swap from 80% to 70% a good thing. Or not?

Overall its a good thing.
It would be callous to penalise those who had gone the extra mile in saving a deposit. Also encouraging an 80%+ LTV is hardly commendable in the eyes of the central bank.

Monife · 20-10-2016 8:57am

RandomAccess wrote: »

Overall its a good thing.
It would be callous to penalise those who had gone the extra mile in saving a deposit. Also encouraging an 80%+ LTV is hardly commendable in the eyes of the central bank.

But it's suppose to help the people who cannot manage to save a large deposit. Now it's a free for all for people who don't even need help.

bleary · 20-10-2016 9:18am

No its supposed to help developers build more.
This 80% measure penalised responsible purchasers. Also self builds are still probably ruled out by it.

To be honest if someone can't save a 10% deposit, should they be getting a mortgage? analysis of arrears have shown they are less likely to be able to cope over the course of the mortgage. They will have to deal with a number of things interest rate increases, employment & life changes etc.

Everyone should have to save for a few years before a mortgage, it's part of understanding the commitment you are making.

I know a lot of people who wish they were made do that rather than put themselves through the last ten years

TheUnderfaker · 20-10-2016 9:23am

I've had absolutely no social life over the last 2 years because I've saved hard to get my deposit together. Every penny pinched and absolutely no unnecessary purchases. I took out a mortgage on a property just last week on 75% LTV. Surely I can't be penalized for this, while somebody who hasn't bothered their hole to do the hard work and save get's free money from the govt?!

stickman22 · 20-10-2016 9:28am

Undertaker, that's us too, we have been officially offered a 76% mortgage, we worked so hard to save 60k of a mortgage, we are delighted now that we will be getting a bit of help too

RandomAccess · 20-10-2016 9:31am

Monife wrote: »

But it's suppose to help the people who cannot manage to save a large deposit. Now it's a free for all for people who don't even need help.

It's always been a builder grant, they know builders earn greater profits from the less basic houses. It wouldn't succeed in its true goal of incentivising development if it just targeted the lowest earners.

Also more importantly,
If they just targeted the lowest rung it would put people who haven't managed to save on an equal footing as those that have managed to scrimp and save to meet the requirements.

It would be a kick in the face to those who followed the rules and would generate enormous anger and undermine trust in government and the central bank.

TheUnderfaker · 20-10-2016 9:35am

It's gonna make all the difference when it comes to actually moving in stickman22. Congrats on the mortgage

Monife · 20-10-2016 9:38am

RandomAccess wrote: »

It's always been a builder grant, they know builders earn greater profits from the less basic houses. It wouldn't succeed in its true goal of incentivising development if it just targeted the lowest earners.

Also more importantly,
If they just targeted the lowest rung it would put people who haven't managed to save on an equal footing as those that have managed to scrimp and save to meet the requirements.

It would be a kick in the face to those who followed the rules and would generate enormous anger and undermine trust in government and the central bank.

Not necessarily all of those people scrimped and saved. I'd say a good chunk of them got help from parents/family. The government spun this "grant" as a help for first time buyer's who are having difficulty* saving the Central Bank's required 10 to 20% deposit and now they are back-tracking and giving a grant to almost "everyone in the audience"!!

*This difficulty may be due to rents on any half decent house being around €2,000 and not having the option to live with mummy and daddy while you save a decent deposit!

Larsso30 · 20-10-2016 11:29am

bleary wrote: »

No its supposed to help developers build more.
This 80% measure penalised responsible purchasers. Also self builds are still probably ruled out by it.

To be honest if someone can't save a 10% deposit, should they be getting a mortgage? analysis of arrears have shown they are less likely to be able to cope over the course of the mortgage. They will have to deal with a number of things interest rate increases, employment & life changes etc.

Everyone should have to save for a few years before a mortgage, it's part of understanding the commitment you are making.

I know a lot of people who wish they were made do that rather than put themselves through the last ten years

Trust me, Dublin rents far exceed most first time buyers mortgage repayments so I think I understand perfectly thanks very much!

Shedite27 · 20-10-2016 1:25pm

Larsso30 wrote: »

Trust me, Dublin rents far exceed most first time buyers mortgage repayments so I think I understand perfectly thanks very much!

Wasn't for me, mortgage is much more.

riclad · 20-10-2016 1:30pm

This scheme is a gift to builders and people who already signed a contract to buy a house.
it,ll only push prices on new house up .It shows this government is short sighted and does not understand basic economics .
We need increased supply in citys, urban area,s .
it also helps rich people ,it should be limited to houses under 300k.

The_Conductor · 20-10-2016 1:31pm

Larsso30 wrote: »

Trust me, Dublin rents far exceed most first time buyers mortgage repayments so I think I understand perfectly thanks very much!

Depends entirely on where and what you purchase.
In most cases, in the Dublin area- despite astronomical rents- its still cheaper to rent than it is to buy (obviously this is subject to various caveats).

Monife · 20-10-2016 3:17pm

The_Conductor wrote: »

Depends entirely on where and what you purchase.
In most cases, in the Dublin area- despite astronomical rents- its still cheaper to rent than it is to buy (obviously this is subject to various caveats).

Commuter belt is the worst at the moment. Minimum €1,600 to rent a house in Celbridge, Leixlip, Maynooth but the same house would cost less in mortgage repayments. Of course you have to factor in ongoing maintenance and repairs, interest rate increases etc but at the end of the day, you have an asset at the end of it.

conf101 · 20-10-2016 3:29pm

The_Conductor wrote: »

Depends entirely on where and what you purchase.
In most cases, in the Dublin area- despite astronomical rents- its still cheaper to rent than it is to buy (obviously this is subject to various caveats).

Definitely not true. In some cases maybe, but not in most cases. I'm about to move to a 2-bed where my rent will be €1400 per month. If I were to buy the same place at the current market price my mortgage repayments would be in the region of €950/month.

68 lost souls · 20-10-2016 3:30pm

The_Conductor wrote: »

Depends entirely on where and what you purchase.
In most cases, in the Dublin area- despite astronomical rents- its still cheaper to rent than it is to buy (obviously this is subject to various caveats).

Where we bought in Dublin rent on a 2 bed apartment is about 400-500 a month more expensive than our 3 bed semi D repayments with an 80% mortgage and there are no houses for rent at all so in our case much cheaper to buy than rent

StupidLikeAFox · 20-10-2016 3:41pm

conf101 wrote: »

Definitely not true. In some cases maybe, but not in most cases. I'm about to move to a 2-bed where my rent will be €1400 per month. If I were to buy the same place at the current market price my mortgage repayments would be in the region of €950/month.

As an aside, this situation is exactly where the grant scheme is designed to help. i.e you could afford the repayments but would struggle to build up a deposit

riclad · 20-10-2016 4:04pm

Say you rent a small flat ,in dublin rents go up every few years .
Your rent will lower than buying a house ,but you don,t have the comfort of living in a house and buying a house is a long term investment .of course it depends on exactly where you buy and where you rent.

T-b0n3 · 20-10-2016 4:07pm

Back on topic:

http://www.irishtimes.com/business/economy/finance-bill-sets-mortgage-threshold-for-help-to-buy-scheme-1.2836955

The LTV rate has been reduced to 70%. Still no change confirmed on the maximum house value.

conf101 · 20-10-2016 4:53pm

StupidLikeAFox wrote: »

As an aside, this situation is exactly where the grant scheme is designed to help. i.e you could afford the repayments but would struggle to build up a deposit

You're dead right. However, the fact that the scheme only applies to newly built houses makes it too restrictive imo

morrga · 20-10-2016 6:53pm

If they go the 70% route and then reduce the threshold to 400k it would be laughable hypocrisy whereby they will eliminate people who need it and give it to people who don't it. The idea was to help people get to their 20% not help people already at 20%.

Monife · 20-10-2016 6:59pm

morrga wrote: »

If they go the 70% route and then reduce the threshold to 400k it would be laughable hypocrisy whereby they will eliminate people who need it and give it to people who don't it. The idea was to help people get to their 20% not help people already at 20%.

They definitely need to reduce the threshold though, 600k was laughable, people looking to buy houses at that price do not need help. I'm disgusted that the LTV has been reduced but won't mind as much if they reduce the threshold.

bleary · 20-10-2016 7:07pm

morrga wrote: »

If they go the 70% route and then reduce the threshold to 400k it would be laughable hypocrisy whereby they will eliminate people who need it and give it to people who don't it. The idea was to help people get to their 20% not help people already at 20%.

No, the idea was never to help "buyers who need it", the idea was to create a frenzy of demand for new builds and then sit back and cross their fingers hoping that builders will start developing.

last night I heard Damien English minister on the radio saying this was introduced because no mortgages were available to FTB,despite central bank statistics showing mortgage lending increasing again in the last quarter.

This is effectively supporting and pushing 100% mortgages. Well done Ireland , oh the Germans must be pissing themselves laughing at us.

68 lost souls · 20-10-2016 7:32pm

bleary wrote: »

This is effectively supporting and pushing 100% mortgages. Well done Ireland , oh the Germans must be pissing themselves laughing at us.

Ehhh how? It's encouraging mortgages of between 70-95% with a deposit of 5-25%

Lowering the minimum LTV encourages more deposit

stickman22 · 20-10-2016 7:35pm

Does anyone have any idea how it will work. Our case is we have have signed contracts (just this week)for a new build to be completed in spring, how do we go about getting the rebate or do we need to wait until the mortgage is being drawn down. We really don't understand much about the ins & outs except we qualify now as we are taking out a 76% mortgage..

TheUnderfaker · 20-10-2016 10:27pm

stickman22 wrote: »

Does anyone have any idea how it will work. Our case is we have have signed contracts (just this week)for a new build to be completed in spring, how do we go about getting the rebate or do we need to wait until the mortgage is being drawn down. We really don't understand much about the ins & outs except we qualify now as we are taking out a 76% mortgage..

I don't think applications will be open until January. By then I think there may be a facility on revenue.ie to sort it all out. It should become clearer closer to the time

stickman22 · 21-10-2016 8:53am

Great thanks Undertaker, the house won't be ready until spring so it will be March at the earliest that we will be drawing down I reckon

CramCycle · 21-10-2016 9:55am

Does it still require a form 12 to be completed for the past 4 years or will they take just P21 as being tax compliant for PAYE workers? The online system only seems to want to go back 3 years, so I imagine it will be alot of paperwork for revenue if they do.

2017-21 help to buy scheme - megathread. All help to buy discussion here please

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