Home economics: Sinead Ryan answers your property questions
We are buying a property which has been vacant and boarded up for some years and we understand the bank is selling it as a repossessed property. Are there any additional considerations around the purchase we should be aware of? We don't want disputes down the road regarding title and there is a small 'granny' flat adjacent which is not for sale but which is also vacant and shares a pathway.
A. Repossessed sales aren't inherently any different to any other and I'm going to assume you were informed by the agent that it is the bank selling the property.
It's important your solicitor carries out a full title review to make sure the bank has the proper title to sell this property and that way you won't run into any disputes down the road from say, the previous owner. This is a straightforward search but important.
Susan Cosgrove of Cosgrove Gaynard Solicitors says she would be more concerned about the granny flat.
"You will need to check on and ensure the position on the granny flat. If this was built on to the property at some stage, there may be adjoining walls, rights of way or services which need to be investigated. The pathway is an example of that. You should either own or have a right of way over this pathway. Again your solicitor will review all of this for you but it is important for you to point out the existence of the shared pathway and the granny flat when speaking to your solicitor.
"I would also strongly advise you to obtain a structural survey on the property. Being boarded up for a couple of years will likely have led to dampness issues at the very least, however, you need to ensure you are aware of any other major structural issues ie dry/ damp rot, subsidence etc, which could severely cost you in the long term."
Q. I have a property left to me which is in poor repair. It needs more than a lick of paint, but nothing structural done to it, and I would probably be getting around to selling it this year, but the tax on it wouldn't make it worthwhile. I also don't have the time to be a full-time landlord, but if I was to do it up, which would cost in the region of €40-50,000, I understand there is a grant for this and the council might rent it from me - can you tell me the limits and what is required?
I believe you are referring to the 'Repair and Leasing Scheme' (RLS). This is a Government initiative which provides upfront financing of up to €40,000, including VAT (the amount has increased) for repairs and improvements to vacant properties.
If it's a former bedsit being brought up to current building standards, up to €50,000 is available.
The deal is that the property is then made available to the local authority which rents it out (under certain guarantees of income to you) to a tenant for at least five years. They are responsible for vetting tenants and collecting rent, so it is very much a hands-off arrangement for the owner.
The types of works covered are decorative and repair in nature (ie nothing that would require planning permission, generally), such as flooring, plumbing, window replacement, painting etc.
The property must have been vacant for at least 12 months already and there must be a social housing demand in the area, with the property assessed as appropriate to council needs.
The best thing is to contact your local authority, check that it is participating in the scheme and put forward your plan.
The Ryan Review
PTSB's proposed flogging of 14,000 non-performing loans has caused a furore. Ulster Bank is following suit, under instruction from regulators while AIB's stance was curious (especially since there are no owner-occupied dwellings in its latest offer), as it deliberately restricted its own sale by insisting on regulated fund buyers.
All sales (and similar) will go ahead, and probably won't bring down the Government, despite Fianna Fáil's penchant for throwing all the toys out of the pram before meekly putting them all back in again.
There is a little duplicity at play though. Taoiseach Leo Varadkar pronounced in the Dáil that the funds buying up the distressed books are (mostly) "regulated", and that only courts can issue possession orders anyway, but the silent point is that regulation itself doesn't mean a thing.
Possession orders are like hen's teeth, with courts loathe to hand them out, but where they have, often the mainstream banks never action them, preferring to leave things lie, for political, PR or internal book reasons. So already there are thousands of families still living in the properties that have been legally, but not physically, repossessed by banks who fear an eviction-backlash.
Vulture funds have absolutely no such qualms. So, although they will abide fully by the process and the law, chucking people out of their homes won't give them a second thought. A repo is a repo after all. That's why the moral commentators are in high dudgeon. There is no logical alternative to these sales which provide the immediate relief on loan books that banks and regulators need, despite the Twitter solutions being bandied about. No, the State cannot just buy them. No, the individual owners cannot just buy them and mortgage-to-rent scheme is flailing. If there is a real alternative, it's up to the Government to want to find it.