Property tax will bring uncertainty to the market, insists MyHome boss

Property tax will bring uncertainty to the market, insists MyHome boss managing director, Angela Keegan managing director Angela Keegan believes the government’s decision to introduce a comprehensive property tax in 2013, rather than 2014, will bring new uncertainty to the market.

Speaking to The Irish Times, Ms Keegan said that the uncertainty the looming property tax would create in the New Year would put a doubt in people’s mind about buying.

It will not be known until April at the earliest the exact criteria for the property tax and the MyHome boss feels this could put potential buyers off just when things had looked up for them on the back of the government’s Budget incentives with regards to mortgage interest relief.

Commenting on the tax, Ms Keegan said: “The announcement does nothing for confidence as it adds uncertainty where the Budget brought certainty.

“I think it’s a setback for anyone thinking of buying now – confidence is what we need.”

Ed Carey of the Society of Chartered Surveyors Ireland (SCSI) and Sherry FitzGerald chief executive, Mark Fitzgerald, both welcomed the announcement though. They told The Irish Times that they believed the public wanted to know what taxes lay in front of them well in advance.

Keith Lowe, chief executive of Douglas Newman Good and Fintan McNamara, chief executive of the Institute of Professional Auctioneers Valuers (IPAV) both questioned the tax though.

Mr Lowe said: “A lot of people will have a lot of trouble coming up with the tax. It’s true that other countries have property taxes, but we’re already heavily taxed. It will need to be well thought out and equitable and should be phased in.

“And it should be charged to tenants: there are landlords who own two or three properties who won’t be able to pay – it would trigger foreclosure.”

Meanwhile, Mr McNamara said he believes that the decision to bring the property tax forward would undo much of the good the Budget did for the property industry.

He said: “The Budget gave some relief, with, e.g., measures like the Capital gain Tax (CGT) relief, but this won’t help things at all.”

In particular, he fears that the tax will fall heavily on the rental sector. “Landlords with a modest rental income from Pre ’63 investments could be hit for thousands of euro.”

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