Query re buying a second property whilst owning an "affordable house"

This forum should ensure that it does not assist anyone in evading their taxation responsibilities and if people post questions that are not clear, the Forum should be entitled to ask them to clarify.

The original poster has not yet claried what "officially" a PPR is(in inverted commas) is and it would certainly lead a lot of people to believe that they are not intending to be totally upfront about the whole thing. The question as to whether the Banks disclosing information to the Revenue is similar. People quite rightly made the point that perhaps now is not the right time to be purchasing a home together if one or more parties are unsure of the relationship. From reading the original post, it came across to me exactly as Complainer took it up, that the AH is no longer going to be her PPR and she will now live for the most part in her new apartment of which she is the benefical owner.

People in general are too quick to claim discrimination and begrudgery when people disagree with them. The reality in this case is that all they are saying is that the Affordable Housing Process should be transparent and used for the aim of which it is set up.

I differ from FKH in that I would be unsure that the girlfriend did not have a stamp duty liability on the purchase of the second home. Yet the floor certificate states that she may not. Stamp Duties will be payable at the close and will be assessed by the Solicitor. A quick phone call to Revenue Stamp Duty Technical Services will clarify, though perhaps it should be in writing as someones personel can offer different opinions.

The reason the Banks are asking about affordable house is to (a) ensure the person with the Affordable House is not already over mortgaged and (b) perhaps they might be giving a different rate as one of the mortgagees will not be an owner occupier.

Also, the person with the affordable house should phone Fingal Co. Co. and outline their circumstances. I am sure this kind of scenario has happened many times given that circumstances change.
 
FKH said:
The Revenue will know that your girlfriend owns a second property when the purchase completes. She can only have one PPR and there could be a clawback of stamp duty on the apartment, plus potentially a clawback from the council.

Of course they might not notice!
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Coming from a tax background, if I had just one cent for every client who's previous advisor advised them that the Revenue might not notice, I would be retired and living a life of luxury by now.

Worst advice ever from a taxation angle.
 
ajapale said:
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aj
(moderator)
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MandaC and others.

Please use the "report post" facility to report posts you suspect breach the posting guidelines. This way the moderators attention is drawn to the breach and effective action can be taken.

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I would have thought that (quite aside from the AH issue), if the girlfriend is buying a second property, which she is claiming not to intend to use as her PPR, investor stamp duty rates would apply to the new purchase.
 
I purchased a home under the AF on my own a number of years ago, I then met my partner and we decided to live together, He moved into my home (this may be the more realistic option). We are marrying next year and we wish to buy a proerty together.

In order for us to do this the path we are taking is re-morg. my AF home (therefore I will be paying back the normal morg. not the reduced Co Co one) so that we can rent this property out and we are buying a property for ourselfs.

I would just like to make one point clear, when you own an AF home you are given your morg assessed on your income, this income is reviewed yearly. So at no point do AF home owners feel the are sailing through paying there Morg at there reduced rate. Our Morg rate is in line with our salarys both as they increase and decrease (and when they decrease you are brought into a meeting for them to assess your situation further, if you cant aford a home you cant keep it like anyone else) and our morg also increases according to the intrest rates like everyone else.

To the orginal poster, I understand were you are coming from in order to purchase the property you need to have your girlfriends earnings included.
Speak to your Morg advisor about the best option for yourself and your partner. But if she wants to have a property in her name too then maybe she needs to re-morg first so her home is no longer AF
 
lol, look its simple its called affordable housing for a reason! This sounds like a calamity waiting to happen, as bad as our government departments can be at times when they come looking for tax or to dot the I's and cross the T's they can be very diligent. I think its a calculated risk, but me personally I think it has enough documentation/paper trail to blow up in your face. It may be okay this year or even next 5 years but down the road it will be a bone of contention with some council or some committee that's what usually happens, but hey what do I know, go with your guy feelings lol.:p
 
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I think the bottom line here is that if you can't afford to buy a house on your own, then you can't afford to buy a house. Your girlfriend is just a girlfriend at this stage, there's no point complicating it by buying a house together (which she shouldn't be able to do, how is she going to afford two mortgages?) until you are sure that you are serious about each other.

Can you afford a mortgage by saying you will be renting out a room? How about just moving in with her for the time being?
 
I think what the OP was initially getting at was that his girlfriend would go on the new house and mortgage to help him afford the property. She will not be an investor as the OP will be occupying the property as his PPR and she will be allowing his to do that as per the Revenue guidelines on owner occupiers. There will be no stamp duty payable on the purchase. Of that I am sure.

In relation to the morals of the AHS I offer no opinion as it is not my place to preach to others as I firmly believe that everyone will use every avenue open to them to make their own lives better. Remember if the GF rents out her entire apartment she must register with the PTRB etc and deal with the consequences that will come with that.
 
FKH said:
I think what the OP was initially getting at was that his girlfriend would go on the new house and mortgage to help him afford the property. She will not be an investor as the OP will be occupying the property as his PPR and she will be allowing his to do that as per the Revenue guidelines on owner occupiers. There will be no stamp duty payable on the purchase. Of that I am sure.

In relation to the morals of the AHS I offer no opinion as it is not my place to preach to others as I firmly believe that everyone will use every avenue open to them to make their own lives better. Remember if the GF rents out her entire apartment she must register with the PTRB etc and deal with the consequences that will come with that.
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Yes, that is very very interesting, certainly with people in the scenario where two people purchase and one is an existing property owner, that they can allow someone to live there without taking rent and still purchase with no stamp duty.

I would also be interested to know if interest relief could be gained on both mortgages. I would think not, as it is linked to whichever is your actual PPR?

It is a condition of the AH Scheme (Fingal) and I think the AH is with Fingal ,that you cannot rent out your entire property and it must remain owner occupied for 20 years. You can avail of the rent a room scheme, subject to the limits for this.

If everyone was to use every avenue open to them to make their own lives better (not just in the context of affordable housing), half of the population would be in jail. Comments such as Revenue might not know are very ill judged to say the least and not what should be taken on board as tax advice under any of the tax heads.
 
FKH said:
I think what the OP was initially getting at was that his girlfriend would go on the new house and mortgage to help him afford the property. She will not be an investor as the OP will be occupying the property as his PPR and she will be allowing his to do that as per the Revenue guidelines on owner occupiers. There will be no stamp duty payable on the purchase. Of that I am sure.

In relation to the morals of the AHS I offer no opinion as it is not my place to preach to others as I firmly believe that everyone will use every avenue open to them to make their own lives better. Remember if the GF rents out her entire apartment she must register with the PTRB etc and deal with the consequences that will come with that.
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The original post said this

"The new property will officially be my primary residence, although in both our names I will be the only one paying the mortgage"

I made the mistake of mentioning moral in an earlier mail as did others but this was countered with begrudgers, etc, so I'll stick to whatI believe are the facts.

From what I've been led to believe if the girlfriend is put on the deeds she has an interest in the house and this will be either as:
1) An investor - In which case stamp duty is payable
2) An owner occupier - In which case she is no longer entitled to affordable housing
 
You need to check the rules of the particular affordable housing scheme, it may be that your girlfriend is entitled to rent it in its entirity, the schemes do recognise that personal situations change. A lot of people are making wild guesses and allegations about the moral/legal fortitude of your particular senario. Go to a solicitor who is familiar with this particular scheme and get proper advice before you make any decisions.
 
ASH83 said:
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I would just like to make one point clear, when you own an AF home you are given your morg assessed on your income, this income is reviewed yearly. So at no point do AF home owners feel the are sailing through paying there Morg at there reduced rate. Our Morg rate is in line with our salarys both as they increase and decrease (and when they decrease you are brought into a meeting for them to assess your situation further, if you cant aford a home you cant keep it like anyone else) and our morg also increases according to the intrest rates like everyone else.
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Is this yearly review standard procedure?
I have purchased an affordable house with mortgage from bank not local authority and throughout application process there was never a mention of a review.
 
@ellaella. I'd also like to know this too. I did ask Fingal and they basically said you can earn what you like once the deal is done.

I'm just about to sign so if this is not the case I'd like to know!
 
ramble said:
You need to check the rules of the particular affordable housing scheme, it may be that your girlfriend is entitled to rent it in its entirity, the schemes do recognise that personal situations change. A lot of people are making wild guesses and allegations about the moral/legal fortitude of your particular senario. Go to a solicitor who is familiar with this particular scheme and get proper advice before you make any decisions.[/QUOTE

The Website from Fingal Affordable Housing outlines that you cannot rent our your affordable house in its entirety.

[broken link removed]
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MandaC said:
The Website from Fingal Affordable Housing outlines that you cannot rent our your affordable house in its entirety.

[broken link removed]
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Good to clear that up factually. It's quite insulting for someone to come on talking about wild guesses, the implication that that you could turn an affordable house into an investor property before the clawback period with no clawback is itself a wild guess
 
Renting out a room but not occupying the house is against the rules of the Affordable Housing scheme, that's a well known fact and the reason for the 'officially' in quotes. When some posters point this out they get called 'begrudgers'. What's Ireland coming to, entitlement culture.
 
DerKaiser said:
Good to clear that up factually. It's quite insulting for someone to come on talking about wild guesses, the implication that that you could turn an affordable house into an investor property before the clawback period with no clawback is itself a wild guess
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I not sure why that poster was going on about wild guesses either. I had originally posted that link on post number 8 of this thread to advise the op that they specifically could not rent out the entire house, so it was quite clear early on that the fact that the house could not be rented out was not any kind of wild guess or assumption.
 
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