Wednesday 12 December 2018

Home Economics: Our property finance expert answers your questions

Energy bills have become a nightmare. Stock image
Energy bills have become a nightmare. Stock image
Sinead Ryan

Sinead Ryan

Question: We are three people renting a house together and the utility bills are becoming a nightmare. One of us wants to install a pre-pay meter as she says it’s the best value for money and we can tightly control our spend. I don’t agree, because I’ve heard these are actually quite expensive, but I would also like the control. As it is, we don’t really know where our costs are going. Now with electricity prices rising we really need a solution. The house itself is quite old (1980s) and wouldn’t have great insulation. Our landlord says we can change supplier if we want. We’re with Bord Gáis currently.

A Pay meters are handy, especially in house-share situations. They can be topped up in lots of shops, or online, you can track where your energy is being used most (and therefore control your usage there) and there is a sense that you are planning better around your needs. You can also contribute a fixed amount to the ‘pot’ without having to chase money from each other when the bill comes in.

Regulatory rules mean you can’t be cut off without notice and there is usually an ‘emergency’ option while you arrange the top-up. But I’m with you on this one. Without a doubt, you are paying more for that. The unit price of energy is inevitably higher on a pre-pay meter. There are three electricity suppliers of pre-pay, and they will install the meter free of charge. However, both the daily rate and cost per kW of power is higher than a regular bill pay contract in each case. Bonkers.ie estimated the difference as €318 in the first year. That’s a lot to pay for supposed convenience.

A better idea might be to sign up to a regular contract with say, Energia, or indeed Bord Gáis or Electric Ireland (there are 14 suppliers, so plenty of competition out there). Those three however, offer a wall-mounted gadget and online app which allows you fully control, assess and keep a tab on usage. Energia’s Netatmo is free until the end of October if you sign up via OneBigSwitch.ie, you can expect to pay around €99 to €249 with the others for Hive or Climote respectively, and also qualify for first year discounts. You can also opt for ‘level pay’ which means the same amount goes out every month. Check out some switcher websites to decide.

 

Q My husband and I got married in our mid-fifties; each of us was previously married and we also have two children each, all grown up now although one is still in college and lives with us.  We have been advised to make a new will but I’m not certain how our assets would be distributed? Would the four children have equal dividends or are they bequeathed to my children if I die and my husband’s if he does?

A This very much depends on what you want to happen. It is really important to make a will because, if you do not, and either of you die, then your estate may become subject to the Succession Act 1965 rules, take much longer to process and should there be any dispute, the whole thing will likely end up in a court process which could take years.

It’s not clear from your question how you actually want your assets distributed, so I’ll take the straightforward line and assume that if you or your husband die, you would want your assets passed to each other, and thereafter equally to all four children. This would allow each of you to inherit tax free, and the children to receive €320,000 each tax free from the estate, irrespective of the actual assets they get — whether it be money, property or anything else.  As all the children are adults, you have no legal responsibility to leave them anything in any proportion, so it is entirely up to you.

If however, it is the case that, say, you brought far more assets into the marriage than your husband, or vice versa, you may wish to have a higher proportion bequeathed to your children than his. Again, this is not a problem, but you must make that clear in the will. I am also assuming that it has been stated in both your divorce papers that previous spouses have no ongoing beneficial interest in either estate. Talk to your solicitor sooner rather than later.

 

The Ryan Review

It was supposed to be the Great Housing Budget. Well, like much of housing policy, there was a lot announced without all that much by the way of action to back it up.

Flagged in advance had been the scrapping of the Help-to-Buy scheme. But this daft initiative, which helps lots of people who don’t need help to build one-off houses in rural areas, was retained. It has been nothing other than inflationary and should have been done away with.

Restoring 100pc interest relief to landlords was politically controversial but it will help to retain the overwhelming number of one-house amateur landlords who prop up the market. Perhaps handing that largesse to corporate multiple-owing property funds may have been more efficient, as would the bringing forward of the vacant land levy and perhaps doubling it which would have concentrated the minds of land hoarders.

Meanwhile, is anybody who badly needs to rent or buy better off? I think it will take many years for the meagre measures to flow through.

Indo Property

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