Your property questions answered...

How do we buy a house before it goes to auction?

How do we go about buying a house before auction? We saw one on Saturday that's going to auction in three weeks time. We want to make an offer - we noticed that 70 per cent of houses put to auction last week didn't sell on the day and that a number of them sold beforehand, so we think we're in a good position. Who do we approach, the house owner or the agent? What sort of a deposit should be offer?

There's no doubt that there was a lot of nervousness in the auction rooms last week with a high number of houses failing to sell under the hammer. Some did sell afterwards and most are now on the market by private treaty. It is always open to prospective buyers to make a pre-auction offer - through the selling agent - but it's relatively rare that these are accepted for a number of reasons, not least because the seller often feels they will get a better price at auction.

Also, sellers like auctions because they are final - if a bid is successful the bidder signs contracts there and then and must go through with the purchase. Agents are used to people suggesting a pre-auction purchase - most do so in an attempt to get a bargain which just about never happens.

Of course, you could make an offer the seller can't refuse but a more realistic way would be to wait until the week of the auction and put your offer in then - at that point the agent will know how the campaign is going. He will know, for example, how many (or if any) conditions of sale have gone out and have a fairly good idea who is going to turn up on auction day. The agent must put any realistic offer to the seller and, if the seller is getting nervous (and some are), then you're in. If your offer is successful you will be asked to pay a non-refundable deposit of 10 per cent and sign binding contracts.

However, don't be surprised if the response to your offer is a firm "no thanks, we'll see you in the auction rooms".

Paying tax on property investment in Canada

We are considering buying a ski lodge in Canada for investment/part use purposes. What is the position about paying tax on the income we would earn from such an investment?

Canada is one of the 44 countries with which Ireland has a double taxation agreement - a revised agreement applied from January 1st, 2006. It's often the case that, once Ireland enters into an agreement with a country on tax, the property developers in that country start marketing property here because they know how attractive double taxation agreements are for Irish investors. That presumably is how you came to be interested in such a far flung place.

The basic principle behind a double taxation treaty is that tax paid in one jurisdiction is taken into account when tax returns are being filed in another. The agreements generally cover income tax, corporation tax and capital gains tax (direct taxes). In other words, you don't pay tax twice on the same earnings. Look at the Revenue's site (wwww.revenue.ie) for more information about the double taxation agreement with Canada but, above all, you must consult a tax advisor before you do anything.

Send your queries to Property Questions, The Irish Times, 10-16 D'Olier Street, Dublin 2 or email propertyquestions@irish-times.ie.

Unfortunately, it is not possible to respond to all questions. The above is a representative sample of queries received. This column is a readers' service and is not intended to replace professional advice. No individual correspondence will be entered into.