Homeowner bail-out hits resistance

In the US, it looks like people who did the sensible thing by not getting sucked into the bubble will be forced to bail out the speculators.

m.ft.com/srt/d/d2c/0.0?feed-arti … d%20Canada

I have a bad feeling that when things get really messy here, calls will be made for a national bail out plan to help those that got in too deep. Pressure will probably come in a similar way to the Stamp Duty movement.

Any thoughts?

Without doubt! If you were massively in negative equity wouldn’t you vote for the party that starts the National Property Investor Relief Task Force

There is no political will to bail out investors , some tax relief scheme could allow a Capitalised CGT writeoff if you are *forced *by certain circumstances to move your PPR and sell at a loss, job or elderly parent .

The rest of them are speculators , no pity and no relief.

In the US many mortagges were missold and with rampant forgery and misrepresentation involved, that did not happen here .

didn’t help these guys …

finegael.ie/news/index.cfm/t … nkey/21875

Lets hope the current crop of Irish Politco’s are so inept or out of touch with economic reality as to believe a bail out is in anyway a positive for Ireland inc.

Blue Horseshoe

Maybe not forgery but certainly there was misrepresentation on the part of many applying for mortgages. I know many people who have used bullsh!t letters stating extra income that doesn’t exist so they could secure a larger mortgage than the banks were willing to give based on their actual pa income.

Don’t forget borrowing the deposit from the Credit Union !!

You reap what you sow. XX

Our total tax bill is already high enough to be thinking of bailing people out but it’s only a matter of time before the CIF insist that Ireland withdraw from the Euro for “the good of the economy”.

And have lower interest rates? :angry:

Precisely. It’s bad for the economy to have houses costing less than quarter of a million you know.

Think about something for a second - if we had a bail out here in Ireland would it really be that wrong morally
hypothetical : lets say for instance the VAST majority of people in the country bought overpriced houses say 99% of every man woman and child :smiley: babies and all with 40yr mortgages

say 50% of the house price is taxes
Stamp duty etc
Then income taxes and all the other usual taxes

Is it really that wrong for the majority of people to demand that their own tax money goes towards bailing themselves out?

If th majority of people voted back in the Govt hoping that they would save the market and the economy and that a bail out was the way of doing it then isnt it democracy at work?
Sure the prudent get screwed but the people with the mortgages pay taxes too and have a right to demand what is done with the money too.
Especially since stamp duty has been such a big earner for the govt!!

Just throwing out a different perspective, worth pondering I think

Of course a bail out is impossible this late in the game. It simply wouldnt work, not enough money.

Some good points there BJB

I was talking to a colleague in work a couple of days about the housing market and stamp duty.

He’s a nice guy with a wife and a newborn kid.
He has no investment properties, but he would like to move to a bigger place to house his growing family.

I was full on about the stamp duty changes being great for FTB’rs and I was glad the changes happened until he mentioned that he couldnt move to a bigger house because he couldnt afford the stamp duty hit.

Before this conversation I was full of bluster about stamp duty being a good thing as it swells the states coffers and helps a bit to keep prices down (a bit).

But really the problem isnt about stamp duty…it’s about the “investors” isn’t it?

My colleague should be able to trade up and not have to pay the government a tax wodge to do so, his growing family will pay taxes for my healthcare as I grow old and feeble, his overall contribution is positive to Irish society.

But the investor, the land bank holder…who the fcuk is benefiting but them and their pockets?
Imho…investors and landbank holders should be taxed heavily on their idle assets, unless they productively use the land…

Clowens brother is a tax dodger and he’s a landlord himself so suppose I’m pissing into the breeze hoping for the landed gentry having to actually help the common folk like my workmate anytime soon…

The Greens are proposing that zoning on land ‘expires’ if it’s not acted upon within a certain timeframe.

With Biffo in charge, the Greens haven’t a snowball’s chance in hell of getting any “anti-developer” legislation passed during the lifetime of this Dail !

If you say ‘‘sure the prudent get screwed’’ then surely a bail-out IS absolutely morally wrong. Full stop.

Not only because of moral hazard, but also because prudence has a long pedigree in moral philosophy as a cardinal virtue.

Sounds like the Naomi Campbell school of democracy to me :laughing: :laughing: Benevolent dictatorship, moderated by assassination, would be more… prudent ?

There should only be a nominal 0.5% or less stamp on your PPR. It’s a terrible instrument, blunt as the arse end of a boat.

It hinders mobility, up, down or geographical. It distorts the market, reduces transactions, and serves no purpose in the PPR market. It would be much more sensible to approach it with a straightforward property tax.

It’s grossly unfair in the above example that LongTermRenter describes.

I dunno Im just throwing it out there, something not right about screwing the prudent but then there is something not right about the way so much of the exchequer was stamp duty and housing related, i.e taken from the people who bought.
When we give out about how we dont want “our” taxes spent this way or that we must remember that its the tax money of those who jumped on the ladder too.
Of course its all academic really because a bail out if shooting yourself in the foot anyway. A pointless affair. And who benefits? Not those who already bought but developers.

Again its worth repeating Im just throwing it out there and those people who bought got stung for alot of tax. Self inflicted maybe and maybe you have no sympathy and dont want to know but you cant change the fact that they went and paid the tax. Therefore have a right to say where it goes?
I dunno ! Its all so very messy :frowning:

I know exactly where you’re coming from, and when you see it happening to friends/relations and so on…

otoh, people went into transactions at least knowing the tax sums involved, and many of those people voted and revoted for parties who fashioned those tax mechanisms, and produced manifesto’s based on where the proceeds should go.

A package deal, maybe. And it’s all so much more desperate considering the lack of anything to show for all that tax-take.

So to me, that tax is like money you democratically take to the bookies - you cast your vote, and if your horse doesn’t come in, you have no right to get it back - even if it was given as a dead cert by the experts. And even if you didn’t really understand the game at all. (I speak from experience :laughing: ) Terrible comparison, I know.

To be honest, I think tax on savings is a lot more naturally unjust.

I know I’m prejudiced by the fact that I may well be a beneficiary in 18 to 24 months time. I escaped the trap. But I also know I would have done a huge amount of research before making such a huge commitment.

And today, I would have had no-one else to blame for my actions - a very privileged position in life.

f I could wish for one thing for the future - compulsory core economics and finance at the secondary school level.

but if a govt is democratically elected and is supposed to represent the people and even if the people demand the money be burnt literally isnt that just democracy? Whatever the majority demand should be catered for shouldnt it?

The people are not to be led more the people are to lead the govt?
If people dont know what can and cant be done with money then the problem is a lack of transparency - everything should be on display clearly, I dont mean CSO website stats of dept of finance reports
I mean everything down to the last detail.
From each individual bullet bought for the army to cutlery in hospitals.

And if your in a sensible minority then thats tough I suppose, isnt that where people who held off have been.

I’m sure there’s a lack of transparency, and I’m sure it’s deliberate, and it relates to a point I make ad nauseam - that an economically educated electorate (a responsibility of people to demand from government) is a dangerous electorate, and political turkeys don’t vote for an educated Christmas.

I think we may have different thresholds of what democracy means. For a lot of people it’s the vote every few years, with the attendant guilt trip that our forefathers gave their lives etc.

Off the top of my head, I think it was JS Mill who had an elitist theory that it might be more ‘democratic’ if some people had a more weighted vote than others. I don’t really disagree with that either.

If democracy really just means ‘one sheep one vote’, then it’s overrated. Unutterable for many people of course, but I’m really past giving a f about that.

Real democracy is participative, and informed, and that is our job as citizens. We take it, because they don’t give it to us.

Jaysus, I only just got back from a lovely relaxing stay in Killarney… back to square one again :laughing: