Trying to sell house - at my wits end

B

batty

Registered User
Messages
102
I bought a new 4 bed semi in Dublin last June. My circumstances have changed (I don't want to bore you) & I have to sell again.

I put good quality flooring down & generally "staged" the house with furniture, soft furnishings etc with the help of a friend who is an interior designer.

The developer has another phase of the same estate for sale at the moment. He had only 1 of my house style in that new phase & it is now sold. I put my house up for sale last Sept for the cost of the New house minus what a buyer would have to pay in stamp duty minus another 20K. I have since reduced my price by 30K again - this means I will take a substansial loss on the price I paid.

I have had 30 viewings & got near a sale agreed but the they backed out just before signing contracts.

At this stage due to my changed circumstances I'm just about making my mortgage payments with no money left over for fun. I'm totally fed up with the whole process.

Has anyone any suggestions what I could do to shift this house?

Dos anyone think that things will improve after the election?
 
On the advert on daft or myhome why don't you state all the pertinent details above. Maybe try a different EA.
 
batty said:
Dos anyone think that things will improve after the election?
Click to expand...
Hi, sorry to hear things are so frustrating for you. Having spoken to several estate agents myself recently, (I am also selling my home), they have all told me the same thing; people are viewing but no one is buying until after the election. If it makes you feel any better, at least it will be done and dusted in four weeks at the most. :)
 
batty said:
At this stage due to my changed circumstances I'm just about making my mortgage payments with no money left over for fun. I'm totally fed up with the whole process.
Click to expand...
You haven't detailed anything about your changed circumstances so I'm posting a bit blind here...

I feel that a 4-bed house in Dublin is going to be a good long term investment and you should try to hold onto it if at all possible. That might mean that you would have to move into the house and rent a room or two to help with the mortgage. Is that an option or would your circumstances rule this out?

batty said:
Has anyone any suggestions what I could do to shift this house?
Click to expand...
I'm still not too sure that shifting it is the best solution for you. Probably your only surefire way of selling it in the current market is to drop the price dramatically. I'd imagine that that would be very painful though as there can't have been much capital gains in the property since last June when you bought.

batty said:
Dos anyone think that things will improve after the election?
Click to expand...
No, I'm afraid I can't see any great improvement after the election. Interest rates are still rising and as it stands we've got a full years supply of second hand houses on the market for sale. It'll take awhile to clear that backlog.
 
Afuera said:
No, I'm afraid I can't see any great improvement after the election. Interest rates are still rising and as it stands we've got a full years supply of second hand houses on the market for sale. It'll take awhile to clear that backlog.
Click to expand...
But that will only if you're selling a new build surely?
 
Why don't you go into Daft.ie and see what the rent is for a similar house in your area. The rent is always more than the mortgage repayments. Therefore, if you were to rent out your house for a year, you will cover your mortgage repayments plus have enough money to probably rent somewhere smaller for yourself.

In that years timespan, the value of your house will have appreciated and your personal circumstances may have come full circle.

It means that you'll be able to keep the house, should you wish to return to it in due course and if you don't, it will at least have appreicated somewhat, so that you are not at a loss and also in competition with a brand new without stamp duty equivalant.

I know it's not ideal, but neither is being at the loss of so much of your hard earned money.

I've seen somone do this before and they are now back living in the house they left for a year.
 
Thanks for your replies.

My changed circumstances was that I was buying with a partner. We've both been married before but he has 2 children, I don't. We were buying this house together to have a family (well one child anyway!) together.

I was buying in my name only as he was juggling his finances with his kids etc. The plan was we would get married & put his name on the mortgage when everything was sorted out. I have another house (with a mortgage too) It was rented short term to a friend - all above board & registered etc.

My partner has changed his mind & decided to end the relationship. I really don't want a 1550 sq foot 4 bedroom family home just for one person & want to get rid of it & go back to my original house. All my sums were based on the Ex's contribution so I'm finding it too going.

I'll just have to wait & see I suppose.
 
TDON said:
The rent is always more than the mortgage repayments.
Click to expand...
Not always the case.
TDON said:
the value of your house will have appreciated
Click to expand...
again there is no rule to say this is the case and as you can see yourself you house has already depreciated. some folks will only buy new - even if its a lesser size house than your own - it honestly amazes me.

To be honest i would be with the farmers mantra "never sell land" and definately not at a loss so i would be more inclined to rent out a room or two until feel the cash flow a bit more, or move out and let house completely if it makes financial sence to do so. Then life may be too short for you to be feeling the pinch become a squeeze every month after paying your mortgage.

In short nobody knows what the future brings. it could bring good times for home owners or a sharper downturn in house prices.

In answer to your question - how to get it to sell, as you have decided that this is the course of action you want to take, then i would say hang in there until after the election as the EA's are telling you buyers are not biting, and in that while learn all you can about your area and your options for renting etc from sites like Myhome, daft etc.
 
TDON said:
Why don't you go into Daft.ie and see what the rent is for a similar house in your area. The rent is always more than the mortgage repayments. Therefore, if you were to rent out your house for a year, you will cover your mortgage repayments plus have enough money to probably rent somewhere smaller for yourself.

In that years timespan, the value of your house will have appreciated and your personal circumstances may have come full circle.

It means that you'll be able to keep the house, should you wish to return to it in due course and if you don't, it will at least have appreicated somewhat, so that you are not at a loss and also in competition with a brand new without stamp duty equivalant.

I know it's not ideal, but neither is being at the loss of so much of your hard earned money.

I've seen somone do this before and they are now back living in the house they left for a year.
Click to expand...

This is terrible advice.

1. The day you rent the place you will become liable for stamp duty clawback at the rate that an investor would have paid on your property. This could run to 10s of thousands of euros.
2. You will no longer be eligable for mortgage interest relief. This will INCREASE monthly mortgage repayments.
3. You will become liable for CGT on any gains when you eventually sell.
4. IF, and this is a really big if, but IF your rental income exceeds your mortgage interest payements then you will be liable for income tax at your marginal rate (41%) on this profit.

Failure to pay these tax liabilities will result in significent penalities and interest, irrespective of whether your mate down the road has done this.

The best route in these cases is always to avail of the rent-a-room scheme and stay within the bounds of the tax breaks available to you.
 
Howitzer said:
This is terrible advice.

1. The day you rent the place you will become liable for stamp duty clawback at the rate that an investor would have paid on your property. This could run to 10s of thousands of euros.
2. You will no longer be eligable for mortgage interest relief. This will INCREASE monthly mortgage repayments.
3. You will become liable for CGT on any gains when you eventually sell.
4. IF, and this is a really big if, but IF your rental income exceeds your mortgage interest payements then you will be liable for income tax at your marginal rate (41%) on this profit.

Failure to pay these tax liabilities will result in significent penalities and interest, irrespective of whether your mate down the road has done this.

The best route in these cases is always to avail of the rent-a-room scheme and stay within the bounds of the tax breaks available to you.
Click to expand...
We were in a delima last December with our house in Dublin. Husband got transfer and couldn't sell house. Everyone recommended to rent but after all that I'm not sure we did the right thing in renting the house. I so hard to know what to do. So many people feel that the market is going to change but do you not think that it's a circle. If people ie Estate Agents, Market investors etc say that nobody is buying then anyone who was thinking of buying won't! Does this make sense! At the start of the year everyone was so weary of buying or selling but nothing has really changed or has it?
Howitzer you also have other costs if you decide to sell ie Capital Gains Tax so weither you sell or rent your caught in every direction. I'm not very up on this there are probably more than that! So would ye recommend selling our house or what?
I personally think that things will start to pick-up again cause there is demand for houses people are still in need, were probably just hopeful that things will change after the election. Either way summer is usually a good time for things to start picking up again, if there going to pick-up at all.
 
Batty,

I love the saying "what's for you, won't pass you", things will sort themselves out and usually when you least expect it. Everything will happen together.

There is a buyer for your house! It sounds great! I would try a different Estate Agent like what someone else recommended. Would I be wrong in saying that you only have to pay the estate agent who sells your house the commission, if so why not have a few more! I remember watching one of these english programmes on housing and I remember them saying how to see if your Estate Agent is working for you. Get someone to ring them describing your house and see would they recommend your house! Do you find them saying alot. "Things are not good anywhere", "thing are slow at the moment". But you need to know why your house is not selling and if your Estate Agent is not recommending your house why?

Charlie
 
Thanks to everyone who has replied.

The EA is only ok, I find the woman I'm dealing with gets very defensive when I ask her anything. She talks to me in a slooooowwww patronising tone of voice as though I am not a particularly bright 6 year old!!

The EA has suggested that I take another price cut but I think at this stage that they just want to be rid of the house. I don't think they follow up enough with potential buyers. I'm convinced that they may have lost at least one serious potential.

The EA also contradict themselves at every turn. They say;
- Things are very slow - NOBODY is buying so you should drop your price. I've countered with but if NOBODY is buying what difference will a lower price make?
- They've said that I have unrealistic expectations. I put the house on the market for €70K LESS than they advised!!
- There isn't much of a market for a house like this - So why did they tell me last Sept that there was??

However for the hassle of starting over I'm going to take the chance that there may be somne activity after the election. I've told them they've got til the 31st May to get me a buyer with a deposit.

If no buyers after that I may go it alone.
 
CHARLIE27 said:
Howitzer you also have other costs if you decide to sell ie Capital Gains Tax so weither you sell or rent your caught in every direction. I'm not very up on this there are probably more than that!
Click to expand...
CGT is paid on the profits from a sale. The money to pay the CGT would be collected from the sale so it's not a huge problem.

SD Clawback is due on the date of rental. So for the OP the clawback of SD alone could have huge financial implications, putting them in a very tough position for the short-medium term (they have no sale proceeds to cover the cost so have to come up with the SD Clawback from personal funds - obviously only an issue if SD wasn't paid at the time of purchase).

To compare the two is a bit of a waste of time.

In the case of the OP, they appear to be selling at a loss from the figures given, so CGT won't have an impact.

Additional fees will be paid on selling (EA costs, Solicitor costs etc.), but these are covered in many other threads.


As for whether you should rent or sell. It all depends on your personal view of the property market and the situation you find yourself in. For the OP, selling does seem the best solution. As others have suggested, consider getting a new EA if you're not happy with the service/performance. Other than that, best of luck with it. It might/will be hard to sell this side of the election, but who knows what'll happen after that.

(I seem to remember before now it was waiting for the budget.... and before that it was.... there's always a reason!)
 
CGT would never be a factor for the OP, or anyone, so long as they don't rent the place. CGT is ONLY liable on investment properties. CGT is NOT liable on a residence that was your principle private residence.

The points I made above are specifically related to the OPs circumstances. Stamp duty clawcack is only liable if you rent within 5 years of buying the property and availed of a FTB rate when purchasing.
 
Batty

See what I mean, its hard to know if EA is workin for you or not! Do u ever think that if you keep droping your price or if it's on the market under value in comparrison to other properties that buyers might b put off, ie they might think problems. If u honestly think your house is worth more look into other EA. if u have any hesitations do what i said earlier get someone to ring them see if they are recommending your house. It only takes a phone call! Did you see that Prime Time show!

Charlie
 
Satanta said:
CGT is paid on the profits from a sale. The money to pay the CGT would be collected from the sale so it's not a huge problem.

SD Clawback is due on the date of rental. So for the OP the clawback of SD alone could have huge financial implications, putting them in a very tough position for the short-medium term (they have no sale proceeds to cover the cost so have to come up with the SD Clawback from personal funds - obviously only an issue if SD wasn't paid at the time of purchase).

To compare the two is a bit of a waste of time.

In the case of the OP, they appear to be selling at a loss from the figures given, so CGT won't have an impact.

Additional fees will be paid on selling (EA costs, Solicitor costs etc.), but these are covered in many other threads.


As for whether you should rent or sell. It all depends on your personal view of the property market and the situation you find yourself in. For the OP, selling does seem the best solution. As others have suggested, consider getting a new EA if you're not happy with the service/performance. Other than that, best of luck with it. It might/will be hard to sell this side of the election, but who knows what'll happen after that.

(I seem to remember before now it was waiting for the budget.... and before that it was.... there's always a reason!)
Click to expand...

What's OP? We bought the house July 2003, started to rent it in March 2007. We are still getting that money from our Mortgage company before they take our mortgage. What is FTB?

Right, we have rented house and when we eventually want to build we have to sell house to finance our build. What will we be liable for and what would the best way to proceed. Howitzer you seem to know what your talking about would there be any chance you would tell me about a bridging loan too?

Charlie
 
OP-original poster
FTB-First Time Buyer
Bridging loan-finance advanced by the bank before the mortgage can be drawn down.

As you have rented the property out within 5 years of purchase, you are liable for stamp duty that would have been payable at the date of purchase if you were not a FTB. This is due and payable from March 2007, so you are already late.

If you are still claiming tax relief at source (TRS) on a property you have rented out, you shouldn't be.

You can deduct mortgage interest from any rental received.

If you are paying rent, you are entitled to Rent Relief.
 
CHARLIE27 said:
Batty

See what I mean, its hard to know if EA is workin for you or not! Do u ever think that if you keep droping your price or if it's on the market under value in comparrison to other properties that buyers might b put off, ie they might think problems. If u honestly think your house is worth more look into other EA. if u have any hesitations do what i said earlier get someone to ring them see if they are recommending your house. It only takes a phone call! Did you see that Prime Time show!

Charlie
Click to expand...

Charlie,

I've sent people along to group viewings, they said the EA was no better nor no worse than other EA's they'd encountered.

I'm not going to drop my price again at least not immediately - I can't afford to! I do think there is a set of factors (as pointed out by other posters) at work here.

Fingers crossed that things move somewhat after the election.
 
ccovich,

I was talking to the mortgage company to explain same and how come they don't explain these things. This is very frustrating! We only started renting the house this March so what are we going to be caught for? & you say that we have to stop our tax relief at source ie from Mortgage company yah! We were FTB but what do we have to pay stamp duty on if we build a house besides the site?

Charlie
 
You must log in or register to reply here.
Back
Top