Section 23: Ballaghadarreen

hi anybody have aproperty here ?any info on rental market ?would you consider this town a decent location?.......thanks

Re: section 23 ballaghadarreen

Used to visit B/Dereen about five years ago adn ti had little going for it then. don't know about today. No colleges, no major employers, just a quiet market town, as far as I could see. Wouldn't invest there myself personally. I'd say prices are tempting though!?

Re: section 23 ballaghadarreen

thanks for that ,i need a section 23, but a property in the 150-200k region would give me cover on my tax liabilities.im looking at a unit (3 bed house )for 185k .the repayments of 720-750 euro a month on interest only ,from my research i recon id be lucky to get 650 rent for it,is it still worth it just to get the credits which will save me alot over the next 10 or so years .

Re: section 23 ballaghadarreen

setemupjoe said:

thanks for that ,i need a section 23, but a property in the 150-200k region would give me cover on my tax liabilities.im looking at a unit (3 bed house )for 185k .the repayments of 720-750 euro a month on interest only ,from my research i recon id be lucky to get 650 rent for it,is it still worth it just to get the credits which will save me alot over the next 10 or so years .

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Don't understand this. What credits? You don't need the S.23 capital allowances if your mortgage interest exceeds your rental income. The only investors who need S.23 relief are those whose mortgage interest and other allowable expenses (maintenance, insurance, etc.) are significantly less than their rental income. Do you have other rental income which you can't set off against these types of costs? If not, you're paying extra (be sure the builder will add a premium to the price to reflect the S.23 relief) for tax relief you can't use.

Re: section 23 ballaghadarreen

sorry to clarify - i own two other properties (1 shop,1 house)both of which combined bring in a taxable profit after all possible deductions of 16 k which i need to shelter .

Re: section 23 ballaghadarreen

setemupjoe said:

sorry to clarify - i own two other properties (1 shop,1 house)both of which combined bring in a taxable profit after all possible deductions of 16 k which i need to shelter .

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Oh, OK. Still, having a nodding acquaintance with Ballaghadereen myself, I'd concur with the earlier poster - not a very attractive investment prospect. Particularly when it comes to resale - property markets can be very slow moving in small rural towns, could take a long time to shift

Also, I'm pretty sceptical about the value of S.23 allowances. As I said, developers build a substantial proportion of the relief into their prices. The rule of thumb suggested to me by an estate agent when I was selling a 2nd hand property with unused S.23 allowances was about 75% of their nett value. E.g., for a property with an S.23 allowance of say €100,000, you could expect the availability of the allowance to have inflated the price by around €30,000 by comparison with a simliar property with no allowances.

Ask yourself would you consider buying the property without the tax relief. A bad investment is a bad investment, with or without tax relief . . .

Re: section 23 ballaghadarreen

Wouldn't touch Ballaghaderreen for a rental investment. I personally know two Auctioneers in the town. By their reckoning, there is approximately 200 properties available to rent at present.

Also Ballaghaderreen is a pretty ratty tatty town as well.....poor quailty jobs, so not a good idea IMO.

Charlestown (Knock Airport development ), Collooney, Ballisodare (Sligo infrastructure/gateway status).... far better options.

Have a look at some section 23 in Carlow, Castlegate and Johns Court. With the institute of tech in the town, the rental is supposed to be quite good.

Do a google for them and you should get the details.

Not a million miles away, I know of a tax incentive property in the middle of Carrick on Shannon which today is worth only about the same or perhaps 5 thousand more than it was bought for 5 years ago. Something not right about that.

rabbit said:

Not a million miles away, I know of a tax incentive property in the middle of Carrick on Shannon which today is worth only about the same or perhaps 5 thousand more than it was bought for 5 years ago. Something not right about that.

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Not entirely surprising, when you take into account the fact that the whole county of Leitrim was designated for tax relief, resulting in a glut of S.23 developments. See this comment from the Leitrim Observer in September 2005 for a pretty jaundiced local view:



As I outlined above, the tax relief results in an inflated price and is of marginal benefit to investors, especially if they are borrowing, where the extra interest incurred would in most cases wipe out the supposed tax advantage. The real beneficiaries are the developers and these reliefs can produce awful results, such as the rash of holiday homes all over Achill Island.

think i,ll try some other way of reducing my tax,thanks

rabbit said:

Not a million miles away, I know of a tax incentive property in the middle of Carrick on Shannon which today is worth only about the same or perhaps 5 thousand more than it was bought for 5 years ago. Something not right about that.

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Fairly typical with S23 stuff, and Carrick on Shannon is way better than Ballaghadereen, by a mile. I passed through Ballaghadereen a week ago and it is a depressing kip to be honest (apologies to all the people who live there, but it really is a depressing place).

I have very litte familiarity with the place, but I would not be so quick to write off Ballaghadereen. When travelling West, I sometimes stop in Ballaghadereen, because there is a good butcher there. I have noticed a definite increase in the multi-ethnicity (is that a word?) of the town. I hesitate to use the word cosmopolitan, but I have a hunch that Ballaghdereen is going to become a better town over the next few years.

It may have a butcher's shop that is worth visiting, but it has very little else. Ballagadereen is one of those dreary empty towns that is ok if you were born there, but has little to attract long-term investment. The cosmopolitan sense that you get there is mostly from the imigrant workers who build the houses that are let to imigrant workers who build the houses etc. The imigrants who work in the shops and stores are replacing the locals who are building the houses... When it all stops, it will revert to being a just place on the road to castlebar where you have to slow down a little.

There are a couple of estates in the town that are selling at tempting prices vis a vis Dublin, but which are essentially lacking in investment potential unless you intend to live there -- if you could call it living! I would rather be locked up in the nearby castlerea prison than to be condemned to a life in this dreary backwater.