For that increasingly rare breed, the first time buyer, now may be the moment to alert you to one or two issues which could assist your decision making process and more specifically, whether now is the time to take that leap into property ownership (or not ).
Firstly, since the 2011 Budget, the exemption from stamp duty for first time buyers has been abolished and stamp duty is payable at a rate of one per cent on a purchase price up to €1 million. So, for example, on a €200,000 purchase, the stamp duty will be €2,000.
Secondly, and this is much better news, the entitlement to mortgage interest relief remains available at prevailing rates. So, a first time buyer buying a home before December 31, 2011, may end up paying significantly less in mortgage repayments over a seven year period, compared to the same purchase if they were to wait until 2012. Obviously, there are qualifying criteria and anyone intending to avail of the relief, should take specific advice. For purchases made after December 31, 2011, the amount of relief available for qualifying first time buyers is greatly reduced.
Pundits have indicated that prices may have further to fall, but intending buyers should perhaps factor in the benefit of mortgage interest relief when deciding whether or not to buy. Also, the relief lessens the blow of the new stamp duty charge referred to above.
Note to the wise: To qualify, it is not sufficient to have merely signed a contract by the end of the year, the first mortgage repayment will also have to have been made.
Walker O’Carroll & Hogan, Solicitors, Pearse Street, Athlone, will be happy to advise you in more specific detail.
For more information call (090 ) 6492692.