Property tax is unpopular, but spare a thought for those who feel home ownership is out of reach?
Kildare’s County Councillors have decided to effectively hike the amount of property tax paid by homeowners in the county.
This is always an emotive topic; an already highly taxed workforce feel they would like a cut in property tax — and they certainly would not appreciate the effective rise they will get.
There is a side issue, however, and that is the high amount of people in Kildare — mainly younger pworkers — who actually wouldn’t mind paying property tax. Because if they were paying the tax then that would mean that they owned their home.
But for a sizeable chunk of a generation, that is a far off dream.
They may well have grown up in a family where just one of their parents worked, and it may not have been extravagantly paid job, but it was enough to pay for the basics in life, such as a family home.
Now it’s typical to have both partners in the household working full-time in reasonably steady jobs (as much as they exist today) but a mortgage is beyond their realistic aspirations.
Raising the necessary €40-80k for a deposit would be challenging to most people, but when you factor in the high cost of living — including, crucially for this demographic, private-school-level childcare fees - then it becomes near impossible.
So we have more and more renters, and with demand for rental property going up and the supply not increasing, the cost of rental property rising.
And now we have a situation where renters can pay up to €1,500 a month for a three-bed semi in certain parts of Kildare, when if they were paying a mortgage on the same property the cost would not be as high as €1,500. Also, by the time they retire they’d own the house.
So it’s a deeply irrational situation we have now.
Especially when you consider that all of these workers who are not in a position to buy will, in 30-40 years time or so, begin to retire en masse — how will they pay their rent then?
Add in the continued wait for a substantial building programme by local authorities, the lack of enough new housing in the private market, and we may well be storing up an accommodation crisis to make today’s crisis seem relatively tame.
In the meantime, if you are caught up in the property tax row, spare a thought for those that wish they were.
Except, of course, those still caught in negative equity — they really got the worst of both worlds and if anybody is deserving of a tax break, no matter how slight, it is them.
They certainly don’t deserve to pay more, which they now must do.