While Building Surge Expected Competiton for New Homes Remains Tight

There is mixed reaction to the announcement by the Central Bank yesterday that the rules governing mortgage approval were being changed –  effective January 2017.

While the Minister for Finance Michael Noonan, The Housing Agency, Limerick Auctioneers and Estate Agents and Countrywide and the Construction Federation welcome the alteration to the rules governing mortgage approval, Broker group PIBA are disappointed that the changes do not benefit non-first-time buyers.

At present, for a home costing €300,000 a first time buyer needs a deposit of €38,000.

When the new rules are put in place, a first time buyer should qualify for mortgage approval with a deposit of €30,000 saving them €8,000.00.

Should the buyer qualify for the Government’s Help-to-Buy scheme for new homes, they will get a tax rebate of €15,000.

However, new homes are in short supply so competition will be tight amongst first time buyers for the limited number of new homes for sale.

What exactly do the rule changes  mean for first time buyers? Read more in the business section of independent.ie http://www.independent.ie/business/personal-finance/property-mortgages/all-you-need-to-know-about-the-rule-change-for-firsttime-buyers-and-how-its-expected-to-spark-building-surge-35240942.html

 

 

 

 

Big News for First Time Buyers

The removal of the €220,000.00 cap on mortgage lending for first time buyers who already have a 10% deposit was welcome news from the Central Bank today.  The current ceiling on loans is at 90% up to €220,000 and at 80% for the balance of a mortgage over €220.000.

According to Central Bank Governor Philip Lane this change has come about due to the increase in property prices and higher earnings.

Limerick Estate Agents and Auctioneers welcome this announcement and see it as a positive move in the long-term. Read more on this at rte.ie/news

http://www.rte.ie/news/business/2016/1123/833676-outcome-of-mortgage-rules-review-to-be-revealed/

 

 

 

 

Renters Beware – New WhatsApp Renting Scam Gang Out There

As Limerick Auctioneers and Estate Agents experience difficulty renting properties at this time due to limited availability in the rental sector we now learn of an elaborate scam, believed to be operated by an Eastern European gang taking advantage of the accommodation crisis, to con innocent accommodation hunters out of large sums of money.  It has been reported by Daft.ie that some of the advertisements on their website were accessed by the gang and changed by them in an attempt to extort money from customers.  They are using the WhatsApp smartphone app to access the adverts and this is a major shift away from previous traditional online phishing scams.  This is worrying for tenants, landlords and property management companies and Gardai are currently investigating the situation.  To avoid becoming a victim read more here

Propety prices on the up

Property prices are still rising and according to the Central Statistics Office House prices outside Dublin were 11% higher up to September of this year.  This is of concern to Limerick Auctioneers and Estate agents due to the lack of supply. read more HERE

 

 

Budget Blues or Good News?

While the property sector may be disappointed with the outcome of the recent Budget for 2017, the fact that it provided assistance for first-time buyers of new homes with an income tax rebate of up to €20,000 on homes valued up to a maximum of €600,000, is some consolation.

Limerick Auctioneers and Estate Agents say it is regrettable though that it does not apply to second hand homes which would normally be the first choice property for a lot of first time buyers.   Often when on a tight budget buying a second-hand house is a wise decision as some or all furnishings may be included in the sale which means the house is immediately livable on receipt of the keys – cutting out many large purchases having to be made.

Buying a second-hand home makes sense for many where they are purchasing a property in or adjacent to the area in which they were brought up. They may wish to be surrounded by family and friends or may need to be close by their old area to look after elderly relatives or to avail of parental childcare.

Buying a second-hand home often means moving into a settled area which has many advantages  –  plenty of local amenities already in place and access to an existing public transport system. The reasons for desiring a second-hand property are wide and varied and apart from the fact that there is a severe lack of supply of newly built houses the fact remains that if people want to live in some of the more sought after areas they have no alternative but to buy a second-hand property. Now the incentive is not there. It is not just in the larger cities like Dublin, Cork, Limerick, Galway, and Waterford that this situation applies.  People are prepared to buy second hand in rural areas too so any incentive to encourage people to inhabit the outlying areas also would be welcomed and should be introduced.

With no reduction in the level of VAT and levies on construction, Limerick Auctioneers think it is difficult to see a major growth in the construction industry any time soon.  Building costs will have to be brought down.  In Northern Ireland and the UK, there is no VAT on housing so it is obvious to see why the Republic of Ireland is suffering.  There is a housing crisis and it needs to be rectified.

A clear example of how the situation can be remedied is Hungary.  The Government there recently cut the VAT rate from 27% to 4% – immediately there was a surge in building.  Surely the same could happen here if an incentive was put in place.

In recent times there has been an alarming exit of private landlords from the rental sector. Perhaps the 5% increase in mortgage interest relief in the budget may help.  Though small it is a start in bringing about more equality between private and commercial landlords over the next number of years.  The Institute of professional auctioneers and valuers have been calling for the vulture funds that invest in residential property to be subjected to the same tax regime as private landlords. The Minister for Finance has proposed changes to Section 110 reliefs which have been used by these funds so the results may soon be seen.

Finally, one piece of good news to emerge from the Budget was the increase in the Capital Acquisitions Tax Thresholds in regards to inheritance tax/gifts in all categories.  It is likely that this will assist the housing market – something that is very welcome at this present time.

Government to put forward plan to deal with rent crisis soon

Simon Coveney the Minister for Housing, Planning and Local Government has stated that the government is putting a plan in place to deal with the current rent crisis and an announcement is due to be made in December.  In an interview on RTE, he said the private sector has been under pressure to provide social housing and this must change. Limerick Auctioneers and Estate Agents are unsure if the forthcoming announcement will include measures to control rising rents. Read more http://www.rte.ie/news/2016/1113/831355-housing/

Relief as New Regulation regarding Security Deposits put on hold

Limerick Estate Agents and others throughout the country have for some time been concerned about new regulations due to come into the industry which will say that by law the Landlord must transfer all security deposits to the RTB for the Limerick Auctioneers and Estate Agents duration of the tenancy.  Their fear was that this would slow down the industry to no end but despite their fears, this incoming regulation had all major political parties supporting it.

Limerick Auctioneers and Estate Agents are experiencing a rental property crisis due to lack of supply and should this regulation go ahead it would bring further complications to an already difficult property management business.

Recent enquiries from the Limerick property sector regarding this regulation received a welcome response with one government source confirming that the scheme will not be brought in any time soon.

 

 

Home Economics – Your Property Questions Answered

Do you want to know about Fair Deal and what happens when a sick or elderly person needs to move to a Nursing Home and their only asset is their house then read about this and more at independent.ie

http://www.independent.ie/business/personal-finance/property-mortgages/home-economics-answering-your-property-questions-35185858.html