Is the Stamp Duty promise now policy?

F

frash

Registered User
Messages
397
Hi,

Is Berties's pre-election promise to get rid of stamp duty for FTBs now policy or could he just cancel the idea?

I ask because I'm selling a house in the FTBs bracket & it was slow going before the election - I expected things to pick up once FF got into power but it hasn't yet.

Are FTBs waiting on it to become policy before committing?

Before anyone says it the house isn't over-priced.
 
According to yesterdays Indo Bertie says stamp duty will be abolished on residential purchases for First Time Buyers.
This will happen before the new government rises in July.
Tax will be abolished on all First Time Buyer purchases and will be back dated to April 30th last.
 
frash said:
Before anyone says it the house isn't over-priced.
Click to expand...

The value of a home is subjective, a house is only worth what someone will pay for it. If you reduced the price to 1 euro it would sell. It is not selling at the price you/your EA have pitched it at. I would conclude it's worth somewhere between 1 euro and your asking price.
 
Are you looking for any more now than it was worth in say June 2005? I guess you are, so why should it be worth any more now than it was 2 years ago?
 
Is your house marketed at a price which you realistically expect a ftb to be able to pay? If not why do you think stamp duty will make a difference?
 
frash said:
Hi,

Is Berties's pre-election promise to get rid of stamp duty for FTBs now policy or could he just cancel the idea?

I ask because I'm selling a house in the FTBs bracket & it was slow going before the election - I expected things to pick up once FF got into power but it hasn't yet.

Are FTBs waiting on it to become policy before committing?

Before anyone says it the house isn't over-priced.
Click to expand...

How do you define FTB bracket?

If the house is price at > €317,500 then the stamp duty changes would make a difference to what they have to pay. If it is priced under then the changes doen't make any difference to you not being able to sell.

There really aren't that many FTB's anymore (due to increased interest rates) with enough earnings to buy a house with a pricetag in excess of €317,500. A single person would have to be earning €70,000 per year gross to get a mortage for €317,500 (5.2% over 35 yrs). A couple would have to earn €30,000 each to get the mortgage (5.2% over 30 yrs).

You can't expect an overnight change in viewer interest. It's the slow summer months. Traditional selling months are April and September. On the flip side the last proper selling season was April 2006 and it's unknown when the next one will turn up.

You don't get to decide the value of your house, it's worth exactly what someone is prepared to pay for it. End of story.

Best of luck.
 
Sorry robd, I must disagree.
There are many young first time buyers with enough earnings to qualify for a mortgage of €317500.
If you are under 30 and earn a gross salary of €52,000 then you can afford a 100% mortgage of this size on your own for a 2 bedroom property.

Whether they should go into such debt is another question but it can be done.
 
NorfBank said:
Sorry robd, I must disagree.
There are many young first time buyers with enough earnings to qualify for a mortgage of €317500.
If you are under 30 and earn a gross salary of €52,000 then you can afford a 100% mortgage of this size on your own for a 2 bedroom property.

Whether they should go into such debt is another question but it can be done.
Click to expand...

In fairness €52,000 is at the upper end of what an under 30's person would be earning. Granted there are people who earn this but it's no where near average. €30-€40k would be nearer the mark.

Perhaps in November 2005 a person earning €52,000 could borrow that but not now. See below for my calcs.

€52,000 is a net monthly take home of €3218 for a single person.
[broken link removed]

Standard max repayments being 40% of take home means max repayments of €1287. With TRS of €133 I guess that could be max of €1420 before TRS is creditted. http://www.jeacle.ie/mortgage/ gives repayments of €1423 over 35 years at 5.2% on a €275,000 mortgage. You might get a little better than 5.2% but ECB + 1.2% is a pretty good average. In November 2005 when ECB rates were at 2% a person on €52,000 could have borrowed €360,000 at 3.2% over 35 years.

The Permanent TSB calculator below gives a max mortage of €200,000 for a net monthly pay of €3218.
[broken link removed]

are giving a max mortgage for €232,000 for gross annual salary of €52,000

I'm sure there's lenders out there that will give more but I don't think any of them will push to €317,500 at current interest rates.

Unfortunately, most people do not yet realise/understand/see the difference in borrowing power between November 2005 and now. €360,000 in Nov 2005 to €275,000 today on a pretty high salary of €52,000. It's more commonly know as a credit crunch and has been responsible for nearly every crash in history.
 
Thanks a lot NorfBank for your brief & accurate reply to my question.

Thanks too to everyone else who replied but I knew it would dwindle down into a "your house is worth what people will pay" thread as so many do on this board.

My house is priced comparibly with other houses in my area. It went sale agreed last year at X Euro but the sale fell through. It is now marketed at a significant reduction from last years sale price & so should be realistic.
 
The way to find the true value of your property is to put it on the market say 10 / 20% below the other houses in the market. This will get the interest of a few buyers and they will bid it upto the value that they are willing to buy. I.e the properties true value.
 
Frash - just curious, as a percentage how much have you dropped the asking price by?

Robd - very interesting affordability has dropped by nearly 85K (360 - 275)- that'a a hugh amount, nearly 25% - WOW. I realise it's for a certain category of buyer and doesn't apply to all and of course don't know the percentage of potential buyers this is made up of but interesting never the less.
 
I know that this constitutes a sample size of one, and so may not be relevant, but for what it's worth:

I am a potential first-time buyer, and the change in stamp-duty has no bearing whatsoever on my willingness or otherwise to buy a property. I am convinced that the stamp-duty issue is a red-herring and that any changes to stamp-duty will have little overall effect on my ability to compete with other potential buyers, some of whom are also benefiting from the same changes in stamp-duty that are supposedly benefiting me.

I'm not trying to convince you that what I'm saying is economically sound or correct, only that it is what I believe, and that as a first-time buyer it may be indicative of what other first-time buyers believe as well- which would explain why the re-election of FF and the implementation of their stamp-duty promises are not having their expected effect on the market.
 
Aileen2 - to answer your question we have dropped the asking price to be 10% less than what we were sale agreed for last year.
 
yes majority of threads on this board seem to go it's only worth what someone will pay for.... not exactly helpful to the seller now is it...

Frash, i am selling an apt. I have done research on the other peoperties for sale in my area. i have not sold yet but am getting 1-2 viewings a week. there is a glut of apartments, similar to mine that are 10k less than mine, to 20k over. my EA has several properties priced at or below mine however they have not been getting ANY viewings.

2 EA's have told me it's not a price issue...(obviously if you drop it to 1 euro like someone mentioned above ..it'd sell, but thats just a stupid suggestion).. the problem is getting serious viewers through the door. I have dropped the price of mine below the majority on the market but have been advised by EA's not to drop further.

FTB are renting instead of buying now as it's cheaper..

stamp duty isn't going to make a blind bit of difference... it's the rising interest rates if you ask me, and everyone is holding out cos they are hoping sellers will keep dropping prices...
 
2 EA's have told me it's not a price issue...(obviously if you drop it to 1 euro like someone mentioned above ..it'd sell, but thats just a stupid suggestion).. the problem is getting serious viewers through the door.
Click to expand...

I really don't understand this point of view. Why else would people stop buying houses? Where have all the serious viewers gone?

You even say here:
FTB are renting instead of buying now as it's cheaper..
Click to expand...

At the end of it all it comes down to how quickly you want to sell. If you need a quick sale then you'll have to drop the price further. If you believe the house is worth what you're asking for then wait for for the market to pick up. But there's a chance that any neighbour that's after a quicker sale may pre-empt you and drop first, leaving you worse off. Its up to you.
 
shanegl said:
I really don't understand this point of view. Why else would people stop buying houses? Where have all the serious viewers gone?

You even say here:

At the end of it all it comes down to how quickly you want to sell. If you need a quick sale then you'll have to drop the price further. If you believe the house is worth what you're asking for then wait for for the market to pick up. But there's a chance that any neighbour that's after a quicker sale may pre-empt you and drop first, leaving you worse off. Its up to you.
Click to expand...

they are all gone renting according to the EA's as i've already mentioned... mortgages are less affordable... plus there's only so low you can drop the price before you start egtting yourself into negative equity...not a nice place to be IMHO
 
You must log in or register to reply here.
Back
Top