Property Clinic

EXPERTS EXPLAIN:Ask our experts for advice on your property problems

Common area in our housing estate is neglected

Q. I OWN A house in an estate in Dublin 5. Although it was built in 1990, the common areas were never handed over to Dublin City Council by the developer. While a management company has been established, not all homeowners pay the management fee for upkeep. There are problems, such as the fact that Bord Gáis will not bring gas into the estate unless the handover occurs and the Council’s unwillingness to deal with illegal dumping or graffiti within the estate’s boundary. Is it possible to compel DCC to take over common areas of the estate?

A. YES, IT IS possible to compel DCC to take in charge parts of your estate. Under Section 180 of the Planning and Development Act 2000, the owners can make a written “taking-in-charge” application directly to DCC. In order to effect this process you should obtain professional advice and begin as soon as possible.

Normally the “taking-in-charge” procedure occurs when the developer, having complied with all planning and building regulations, confirms completion and requests the Council to take-in-charge agreed portions of the development, eg main spine roads, sewage drains, water mains.

The estate’s details are then added to the statutory schedule and map of the area and responsibility for maintenance passes to the Council. The remainder of the common areas such as green spaces, car parks, and services including lighting and waste management, are often separately handed over to the owners management company (OMC) at this time. Unfortunately, in your case, this does not appear to have occurred so your estate completion and ownership remains in limbo and contractors like Bord Gáis cannot obtain necessary permissions to carry out work.

The issue of non-payment of management fees by some owners is a separate issue. These management fees are service charges payable to your OMC and are required to ensure basic services, eg waste collection, landscaping, surface cleaning.

Withholding fees contributes to the problems and results in inadequate funds to clean the graffiti etc. Your OMC should instigate a formal debt collection process.

* Siobhan O’Dwyer is a chartered surveyor and chair of the Property and Facilities Management professional group of the Society of Chartered Surveyors Ireland, scsi.ie

Can I get an insulation grant?

Q. CAN I get a grant to insulate my home?

A. YES. THE following grants are available for insulation: attic, €200; wall – cavity, €320; wall – external, €4,000; wall – internal dry lining, €2,000. Full details from the Sustainable Energy Authority of Ireland, seai.ie

The simplest and least intrusive way to improve the insulation in your home is by installing/increasing insulation in your attic. It is important to be aware, that improving attic insulation can cause interstitial condensation (condensation within the structure) to occur in the attic space or roof structure.

Any increase in insulation needs to be accompanied by appropriate measures to ventilate the attic space.

With external insulation, various systems are available, but generally they comprise solid insulation panels fitted to the outside of your walls, with a special render finish over the top. It is very effective, but quite expensive. It’s worth considering if your home needs to be re-rendered anyway.

Internal dry lining with insulation is cheaper, but more disruptive, and it is important that it is properly detailed around windows and other openings.

It is worth getting advice from a professional if you are considering upgrading your insulation, as there are various factors to be considered in arriving at the best and most cost effective solution.

* Krystyna Rawicz is a chartered building surveyor and is a member of the Society of Chartered Surveyors Ireland, scsi.ie

* EDITOR’S NOTE: If you would like information, from architects, on how to make your home more energy efficient – including the use of insulation – and the grants that are available, go along to the How to Create a More Energy Efficient Home seminar this Saturday 26th at RIAI (Royal Institute of the Architects of Ireland) at 8 Merrion Square, Dublin 2, between 10am-1.30pm, €35. See riai.ie or call 01-676 1703.

If I rent my house out will I have to pay tax?

Q. I EMIGRATED SIX years afterbuying my house 20 years ago. I didn’t rent it out then or since (I’ve been back for four years) but now I’m going abroad again for at least two years.

If I rent it, would I have to pay capital gains tax, a) only on the gain and only over the period of the rental? or, b) would the CGT be calculated on the gain in value over the entire unoccupied period, rented or not, which would generate a massive CGT bill and make renting it not worthwhile.

How is CGT calculated on a principal private residence that has been unoccupied/rented for long periods?

A. IN TERMS OF renting your house, you will have to pay income tax as appropriate on the rent received. And if you sell your house, only the part of the gain representing you occupying the house will be exempt from CGT plus an additional 12 months. CGT is in principle payable on the gain over the period of your property being unoccupied, whether being rented out or not. But certain periods of absence due to employment can be treated for CGT as periods of living in your house.

As you lived in the house before and after your period of absence of 10 years (and your absence was due to employment abroad) this period could be treated as a period of own occupancy. So you are exempt from paying GCT on this period of absence.

So you will not generate a large CGT bill and renting the house out now should make definite financial sense.

* Ursula Tipp is a partner and head of tax at law firm ByrneWallace, byrnewallace.com

I want to do a house swap

Q. WE HAVE a thee-bedroom apartment in the Elviria area of Spain, built by McInerney Construction about 10 years ago. We bought the property for €325,000 plus taxes and so on. Might we be able to swap it for a property of similarl value in Dublin, obviously taking into account today’s prices?

I realise there would be taxes and so on involved, but are there any companies out there who might handle such a property swap?

A. I REALLY DO not think that this is a practical solution. The Spanish legal system does not contemplate an exchange of properties outside its jurisdiction. So the conveyance of the Spanish apartment would be subject to transfer tax, notary fees, land registry fees, and plus valia tax based on the current market value of the property. These would amount to between 10-11 per cent of that value.

There would also be retention of 3 per cent of the value to be lodged to the Spanish Revenue against any capital gains tax liability. Although there would most likely be no CGT liability in this case, the retention would still be made and would then have to be reclaimed from Spanish Revenue, a process which can take 12 to 15 months on average. A further difficulty arises in satisfying the public notary for the purposes of the money laundering regulations. This is generally done by transferring funds into a Spanish bank account, after which the bank issues a certificate confirming the receipt and origin of the funds.

In this case, as no money would actually transfer into Spain, the technical difficulty of not presenting a bank certificate to the notary could be problematic.

I am familiar with the location of this property and would suggest, notwithstanding the difficult market conditions, that you should engage a local agent to sell the property.

This is a prime property location and, although prices have fallen considerably from their peak, the percentage reduction in this area is a lot less than in other secondary locations. There is a reasonable level of activity in the market in Elviria, driven mainly by northern European clients, so by using an agent who has access to these markets, it should be possible to sell the property within a reasonable timescale.

* Peter Fitzgerald is a chartered surveyor and member of the Society of Chartered Surveyors Ireland, scsi.ie

Send your queries to propertyquestions@irishtimes.com or to Property Questions, The Irish Times, 24-28 Tara Street, Dublin 2. This column is a readers’ service. Advice given is general and individual advice should always be sought