If you sell your home for 15% above your LPT valuation...

Why apply a different standard to rural Ireland, Brendan?
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He is probably thinking that "rural Ireland" is lagging in house price rises and the next jump may happen there (Already happened in Cities).

A bit touchy, huh?
 
T McGibney said:
Why apply a different standard to rural Ireland, Brendan?
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Because rural houses haven't risen by the same % as houses in Dublin so it is harder to justify a hugely different sale price to the submitted valuation.
 
Sunny said:
Because rural houses haven't risen by the same % as houses in Dublin so it is harder to justify a hugely different sale price to the submitted valuation.
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But this assumes that the sort of unanticipated scenario that has become commonplace in Dublin recently - ie, two or more bidders bid against each other for a property, and drive the price well above the previous going rate - will never occur in other cities or towns or in the countryside.

How is such an assumption safe?
 
monagt said:
He is probably thinking that "rural Ireland" is lagging in house price rises and the next jump may happen there (Already happened in Cities).

A bit touchy, huh?
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Sorry, this is a discussion forum. Feel free to ignore my posts if you wish, but I am making a genuine point here, so there's no need for you to question my motivation, thanks.
 

He don't think he was advocating it as policy. I think he was saying if that scenario happened today, someone was probably chancing their arm. Anyway, he can speak for himself!
 
It was extremely difficult to value homes in the countryside for LPT as there was so little movement in the market to compare against in the years previous to 2013.

In town estates there were some sales, so approx comparative valuations were feasible. It could be assumed that such sales in the future will attract 2 or more bidders as presently there are so few new builds.

The % increase may be 30 indeed but this would be on a very low base. An example here in a rural town :120000 3 bed semi which was 300000 at the height.

With 30% increase such a property would edge into a higher valuation bracket at 156000 still leaving it at almost 50% of its highest value. The value placed at May 2013 was true and verifiable yet it is quite possible that 30% increase will occur in 2015 because of the upward trend.
 

The 15% refers to the top of the band though.

So using your example a house valued at 120k would have to increase to 172,500 (150k x 115%), before there'd be any potential issue.
 
Sorry, this is a discussion forum. Feel free to ignore my posts if you wish, but I am making a genuine point here, so there's no need for you to question my motivation, thanks
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Ooops! Motivation? Huh!
 
mandelbrot said:
The 15% refers to the top of the band though.

So using your example a house valued at 120k would have to increase to 172,500 (150k x 115%), before there'd be any potential issue.
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There's often no slack from the middle of a band to absorb any of that 15%. Most people valued their house for property tax at the top of the lowest reasonable band.

Possibly if the bands had been 275-325, instead of 250-300 then the range that people mentally value their property might have fitted better with the tax bands. I assume more people like to think their house is worth around 200k, 350k, 400k etc, than around the actual midpoints of the tax bands such as 375k or 325k.

It now seems you've got to pick the top of your range if you intend to sell within 3 years to minimize future property tax problems, if you think your house is worth 280-320k you better pick the 320 band even though you know if forced to sell now you're unlikely to get that figure.
 

Sorry, you'll have to educate me on this as I've never used the LPT system, not being a property owner. Are you telling me that you have to actually put a specific value on your property, within the band?!

I always assumed that one simply selects a band and that's it.
 
Brendan Burgess said:
But if someone sells their property in rural Ireland for 40% more than they valued it 15 months ago, then they undervalued the property and need to pay more LPT.
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While this is likely in most cases to be true, it is not true in all cases. Major renovations, change of planning permissions, a new road, school could change a value massively.
 

If one follows auctions in other areas than in Dublin, you'll often see a particular property go for far above it's sale price, precisely because two or more bidders want it.
 
I think people are over complicating this. As long as you have a logical explanation to explain the jump between the valuation you put on it for property tax and what it is sold for, there isn't a problem. So if you have renovated or a new train station has opened or property prices have just soared since 2013 and the value has increased, that's not a problem with regard to revenue.
 


I agree Brendan. I started another thread on this as you know, our problem was I think now one of communication as much as anything else. The first we heard of this was a list of things required by the buyers solicitor which was forwarded to us without comment. All were fine except the last which demanded that we pay the difference between the our original valuation and the sale price-which was considerable due to us being in Dublin. Also they only wanted it paid for 2014. It just didn't make sense to us and still doesn't. Does anyone know how long it takes to get clearance at the moment?
 
It was very difficult to judge market value in May 2013.

As a real life example - we valued a property in May 2013 as band "x". A neighbour's house sold in Nov 2013 at €7,000 over the top of that band. There was some movement upwards in the market by then so I would still say we valued correctly in May that year.

Two estate agents who valued my house last week think my house will now sell at a value two bands higher than my neighbour's did less than one year ago, ie: over 100k more.

So my original valuation is now three bands below today's value. I could be one of those people that Revenue says deliberately undervalued - but I genuinely don't think so. When it comes to selling your house - I reckon plenty of people will end up sighing & paying Revenue extra unjustified money just to make sure the sale goes ahead.

Either a valuation from May 2013 stands for three years or it doesn't.
 

I agree 100%.

The route of the problem here, is that the Revenue rolled out this property tax withouth having put enough detailed background work into how property prices should be valued and provide these resources to us.

A far more detailed method of valuation on their website, would have resulted in far less "wriggle room" for people when submitting their own estimates of valuations on their properties.

Now, rather than acknowledge that the initial valuation system was very lose and just upgrading it for when we all have to revalue our properties at the end of Year 3, they are trying to take advantage of the fact that some property prices (particularly Dublin) are rising rapidly.

Anyway, one positive is it only matters if your in the process of selling your house so I guess for a large percentage of the population it's not a problem. Hopefully, the Revenue will improve the rules and system for valuation in the not too distant future, to overcome the current issue.
 

It does stand, of course it does.

In your case the sale of the similar property for 7k more, would support your valuation in the lower band 6months earlier (I'm assuming 7k is less than 15% of the upper end of the band), so I'm not sure what your problem is..?
 

My problem is that Revenue has seemingly arbitrarily decided that if you are within 15% of the top of the valuation band, that's fine, but above that then you under declared your property tax valuation. If the estate agents who valued my house this week turn out to be correct, then my house is now 40% over the top of the bracket that I declared and is worth more than 36% more than my neighbour's house sold for 9 months ago.

So the simplest option looks like I have to justify my valuation to Revenue before I can sell or the worst case is I am seen as a property tax undervaluer cheat & owe them money for 2013 & 2014 because I wish to sell before the next round of valuations in 2016.
 
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