Advertisement
If you have a new account but are having problems posting or verifying your account, please email us on hello@boards.ie for help. Thanks :)
Hello all! Please ensure that you are posting a new thread or question in the appropriate forum. The Feedback forum is overwhelmed with questions that are having to be moved elsewhere. If you need help to verify your account contact hello@boards.ie

Lending restrictions: what ya gonna do?

Options
  • 20-01-2015 11:45am
    #1
    Mr.McLovin
    Registered Users Posts: 470 ✭✭


    Its looking increasing likely the CB bank will enforce the new rules as set out by Honohan, wondering how everyone is fixed?

    Whats the plan? 123 votes

    I have close to/over 20%, I'm laughing
    0% 0 votes
    Buckle down, save and be there 1 - 2 years
    51% 63 votes
    Keep saving but god only knows when I'll get there
    13% 16 votes
    Give up, blow 10k on a holiday and keep renting
    35% 44 votes


«1

Comments

  • Options
    #2
    The_Morrigan
    Moderators Posts: 9,368 ✭✭✭The_Morrigan


    Folks we have a general discussion of the CB restrictions here, please keep this thread to personal experiences.


  • Options
    #3
    Captain Chaos
    Registered Users Posts: 11,174 ✭✭✭✭Captain Chaos


    I can get the 20% in 1 year no problem.

    It's the percentage of my income of these new rules that means I will never afford a house in Dublin so I have no choice but to rent forever. Moving outside Dublin is not an option for me due to work and crazy days/hours.

    I know myself I can afford a house in Dublin but the Central Bank is telling my I cannot. My current rent is higher than alot of mortgage repayments currently for a 280-300k house.

    Think I'll just pack up and move to another country to buy and live.


  • Options
    #4
    baldbear
    Registered Users Posts: 5,534 ✭✭✭baldbear


    Could the banks not use judgement calls for individual cases?

    We have about 15% saved and pay more than what our mortgage would be in rent and savings. Rent /savings = €1500 mortgage should be around €1200.

    I think the rule is a move in the right direction but its about 10 years too late.


  • Options
    #5
    Greenmachine
    Registered Users Posts: 5,063 ✭✭✭Greenmachine


    Captain Chaos wrote: »
    I can get the 20% in 1 year no problem.

    It's the percentage of my income of these new rules that means I will never afford a house in Dublin so I have no choice but to rent forever. Moving outside Dublin is not an option for me due to work and crazy days/hours.

    I know myself I can afford a house in Dublin but the Central Bank is telling my I cannot. My current rent is higher than alot of mortgage repayments currently for a 280-300k house.

    Think I'll just pack up and move to another country to buy and live.

    Lots of lots of people knew they could afford bigger payments, now many of them are in arrears, in some cases up to two years or more. Anything to prevent a recurrence of the current mess is a good thing.


  • Options
    #6
    Eldarion
    Registered Users Posts: 484 ✭✭Eldarion


    Captain Chaos wrote: »
    I can get the 20% in 1 year no problem.

    I know myself I can afford a house in Dublin but the Central Bank is telling my I cannot. My current rent is higher than alot of mortgage repayments currently for a 280-300k house.

    If you can get the 20% in 1 year "no problem" then why not get the 100% in 5 years and you don't even need a bank! :rolleyes:

    In fact it should take you only about 3 and half years if you amass the capital in any investment vehicle that will earn you >5% per annum and you currently have the 20%.


  • Advertisement
  • Options
    #7
    spaceHopper
    Registered Users Posts: 3,970 ✭✭✭spaceHopper


    All well and good saying you can afford it now and all well and good for the Government and VI's to say it's a bad idea but what happens if the house prices keep running away like the boom or in the last few years. Ireland would become so expensive to live in that consumer spending would stop, companies wouldn't want to employ people here or set up / stay here and would go else where.

    I didn't see Noonan coming up with a better way of stopping a bubble, did you?

    For what it's worth when we bought we had a 20% deposit because the banks wanted you to have it as prices were going down so this is not new it's just that prices are rising and "they" want to cash in at your expense!

    We also did our own sums on what we could afford at ended up buying a house for 320k instead of one we'd been bidding on it sold for 475 in the end I think. Then my wife had twins and now she's about to be made redundant so I count my blessings we were careful.

    Things change sometimes life kicks you in the head in a good way but expensive.


  • Options
    #8
    Shotgun Sister
    Registered Users Posts: 28 ✭Shotgun Sister


    Emigrate definitely needs to be in the poll options.


  • Options
    #9
    MouseTail
    Registered Users Posts: 1,663 ✭✭✭MouseTail


    Eldarion wrote: »
    If you can get the 20% in 1 year "no problem" then why not get the 100% in 5 years and you don't even need a bank! :rolleyes:

    In fact it should take you only about 3 and half years if you amass the capital in any investment vehicle that will earn you >5% per annum and you currently have the 20%.

    I presume the poster was saying they already have accumulated savings, and can top it up to 20% in a year, not that they could save the total 20% in a year.


  • Options
    #10
    helimachoptor
    Moderators, Science, Health & Environment Moderators Posts: 21,644 Mod ✭✭✭✭helimachoptor


    At current prices for houses we are looking at we have 20% expectation that houses in our price range drop off a bit giving us a better deal


  • Options
    #11
    [Deleted User]
    Posts: 0 ✭ [Deleted User]


    Shotgun Sister wrote: »
    Emigrate definitely needs to be in the poll options.

    I doubt a single person planning on buying a house here in the near future is going to emigrate because of this. Generally anyone buying obviously sees their future in Ireland so emigrating wouldn't be even a consideration.


  • Advertisement
  • Options
    #12
    Sala
    Registered Users Posts: 1,494 ✭✭✭Sala


    baldbear wrote: »
    Could the banks not use judgement calls for individual cases?

    We have about 15% saved and pay more than what our mortgage would be in rent and savings. Rent /savings = €1500 mortgage should be around €1200.

    I think the rule is a move in the right direction but its about 10 years too late.

    Yes they can. A lot of people see my forget they have wiggle room built in. They have room for exceptions I think it's 80 or 85% need to adhere to new rules

    Edit- it's 85%. With good savings record etc you could apply and hope to be in the 15% exception


  • Options
    #13
    chikatee
    Registered Users Posts: 39 ✭chikatee


    We are first time buyers......but in our mid 30s. We don't have time to be saving more. Want to start life in our 'own' home. just about have d 20 percent but won't leave a lot for other expenses. We'd b eating our dinner n sleeping on d floor!!!!


  • Options
    #14
    Electric Sheep
    Registered Users Posts: 2,104 ✭✭✭Electric Sheep


    chikatee wrote: »
    We are first time buyers......but in our mid 30s. We don't have time to be saving more. Want to start life in our 'own' home. just about have d 20 percent but won't leave a lot for other expenses. We'd b eating our dinner n sleeping on d floor!!!!

    Well, that's how homeowners have always started out, apart from the brief blip during the bubble when Celtic Cubs expected to fully furnish the house out of the mortgage.


  • Options
    #15
    marathonic
    Registered Users Posts: 1,662 ✭✭✭marathonic


    Sala wrote: »
    Edit- it's 85%. With good savings record etc you could apply and hope to be in the 15% exception

    I suspect the 15% will be mostly reserved for high-value jobs with low starting salaries - such as trainee doctors, accountants and solicitors.

    It wouldn't make sense to restrict a trainee in these professions to mortgages of 3.5 times their trainee salary.


  • Options
    #16
    chikatee
    Registered Users Posts: 39 ✭chikatee


    Electric Sheep wrote: »
    Well, that's how homeowners have always started out, apart from the brief blip during the bubble when Celtic Cubs expected to fully furnish the house out of the mortgage.

    I know ya. Was just hoping is all that my saving would furnish but with a 20 percent deposit that's not goin to be as easy. I saved to furnish!


  • Options
    #17
    desertcircus
    Registered Users Posts: 2,648 ✭✭✭desertcircus


    Close to the 20%, but not quite there. Hoping to manage it by late summer this year, by which time we'll hopefully have a clear idea of the market's reaction to the CB rules.


  • Options
    #18
    Sala
    Registered Users Posts: 1,494 ✭✭✭Sala


    marathonic wrote: »
    I suspect the 15% will be mostly reserved for high-value jobs with low starting salaries - such as trainee doctors, accountants and solicitors.

    It wouldn't make sense to restrict a trainee in these professions to mortgages of 3.5 times their trainee salary.

    Lol I'm a trainee- I might try that argument with the bank :-)


  • Options
    #19
    Sala
    Registered Users Posts: 1,494 ✭✭✭Sala


    desertcircus wrote: »
    Close to the 20%, but not quite there. Hoping to manage it by late summer this year, by which time we'll hopefully have a clear idea of the market's reaction to the CB rules.

    I think we could have it by then too, and I'm nearly glad it's a bit if a delay because if the new rules come in things might settle down and hopefully there'll be a bit of stability in the market.


  • Options
    #20
    Mr.McLovin
    Registered Users Posts: 470 ✭✭Mr.McLovin


    out of the 20%ers, I wondering how many of you aimed for that amount versus how many ended up at 20% because they haven't been able to find anywhere adequate or affordable?


  • Options
    #21
    by the seaside
    Registered Users Posts: 389 ✭✭by the seaside


    Mr.McLovin wrote: »
    out of the 20%ers, I wondering how many of you aimed for that amount versus how many ended up at 20% because they haven't been able to find anywhere adequate or affordable?

    Adequate and affordable are two valid options. The third is good value.

    I can afford a fiver for a Mars Bar, but I'm not paying it.


  • Advertisement
  • Options
    #22
    TrishSimon
    Closed Accounts Posts: 206 ✭✭TrishSimon


    Mr.McLovin wrote: »
    Its looking increasing likely the CB bank will enforce the new rules as set out by Honohan, wondering how everyone is fixed?

    I am going to be stuck renting a kip of a house and paying € 1100 per month, myself and my husband for 2 years knuckled down and were paying loads of anything we owed like loan and credit union and saving at the same time we have just about enough to cover 10% needed for a house of 230K plus all the usuals like legal fees etc but now with the 20% coming in we are never going to get there I am 39 and my husband is 40.
    I already own an apt a one bed which I rent out as its too small for us to live in because I am involved in animal rescue and have animals plus my tenant really loves living there she is a great tenant no hassle I dont make any money from the apartment the rent I get paid just about covers mortgage, maintenance fees and property tax. I agreed not to raise the rent for her because she herself owns in Wexford so we thought we were doing good having the 10% not obviously not !


  • Options
    #23
    seamus
    Registered Users Posts: 68,317 ✭✭✭✭seamus


    marathonic wrote: »
    I suspect the 15% will be mostly reserved for high-value jobs with low starting salaries - such as trainee doctors, accountants and solicitors.

    It wouldn't make sense to restrict a trainee in these professions to mortgages of 3.5 times their trainee salary.
    It makes perfect sense. Plenty of accountants and solicitors I know lost their jobs over the last 8 years because so many people went the Business & Legal route in college and then found the two professions massively oversubscribed when the bubble burst.
    Trainee doctors, perhaps, but I would imagine there's a high enough % who just don't make it for various reasons.

    I think it's more likely that the rules will be eased for people between 30 & 50 on decent salaries with a proven career & repayment track record behind them. These are the people least likely to go into arrears on larger repayments.

    The effect of this I think would be a reduction in the prices of "starter" homes, which would ease the rental crisis, but it could cause the South Dublin market to become even more ridiculous.


  • Options
    #24
    Kinet1c
    Closed Accounts Posts: 824 ✭✭✭Kinet1c


    Mr.McLovin wrote: »
    out of the 20%ers, I wondering how many of you aimed for that amount versus how many ended up at 20% because they haven't been able to find anywhere adequate or affordable?

    Aimed for that amount to avoid higher monthly payments, may go further if required.


  • Options
    #25
    Aka Ishur
    Registered Users Posts: 740 ✭✭✭Aka Ishur


    TrishSimon wrote: »
    I am going to be stuck renting a kip of a house and paying € 1100 per month, myself and my husband for 2 years knuckled down and were paying loads of anything we owed like loan and credit union and saving at the same time we have just about enough to cover 10% needed for a house of 230K plus all the usuals like legal fees etc but now with the 20% coming in we are never going to get there I am 39 and my husband is 40.
    I already own an apt a one bed which I rent out as its too small for us to live in because I am involved in animal rescue and have animals plus my tenant really loves living there she is a great tenant no hassle I dont make any money from the apartment the rent I get paid just about covers mortgage, maintenance fees and property tax. I agreed not to raise the rent for her because she herself owns in Wexford so we thought we were doing good having the 10% not obviously not !

    Whats stopping you selling the apartment? Its highly unlikely you would get the mortgage when the rent is barely covering cost and if you are not benefiting from the asset why keep it?


  • Options
    #26
    Villa05
    Registered Users Posts: 4,513 ✭✭✭Villa05


    Anyone consdering moving to lower cost areas
    eg Limerick is one of 3/4 areas that have above average disposable income and has some of the lowest accomodation costs in the country.
    Serious quality of life gains by moving.
    Huge decision though


  • Options
    #27
    lisasimpson
    Registered Users Posts: 1,830 ✭✭✭lisasimpson


    Im in the situation where the 20percent deposit isnt a problem due to saving for many a yr from a young age as my parents drilles the concepts into me and other circumstance gor me the 20 percent. But the times your salary is the issue for me. Im hoping the banks will give some wigle room on that if they take into account my rent per month and the monthly direct debit into my savings


  • Options
    #28
    helimachoptor
    Moderators, Science, Health & Environment Moderators Posts: 21,644 Mod ✭✭✭✭helimachoptor


    Kinet1c wrote: »
    Aimed for that amount to avoid higher monthly payments, may go further if required.

    pretty similar, no target as such but keep saving, the more we put down on a house the less interest which means more money in our pockets


  • Options
    #29
    TrishSimon
    Closed Accounts Posts: 206 ✭✭TrishSimon


    Aka Ishur wrote: »
    Whats stopping you selling the apartment? Its highly unlikely you would get the mortgage when the rent is barely covering cost and if you are not benefiting from the asset why keep it?

    The apartment is not the problem for me I dont make a profit from it the amount my tenant pays covers the mortgage and the costs that go along with an apartment like maintenance fee and the apartment is not stopping us from getting the mortgage amount we want in fact if I sold it I would be offered around 280K but we dont need that amount nor can we afford that amount we are only looking for about 230K and were approved for that but we couldn't find any house suitable so the bank AIB told us to save a few more thousand so that is what we were doing for a few months.
    I have a tenant in there in she has been there for 3 years its next to her work and she is generally a great tenant the reason for not selling is two things at the moment its valued at about 110K but the complex its in will be completely up an running by late 2015 or early 2016 with cafe's, medical centre etc so the value of it will go up a little also as I thought I was buying this year I didnt want the hassle of selling and buying in the one year but my plan is when this tenant leaves it will be sold also I dont really want to leave the property ladder as in sell the apartment and not own anything at all if you understand.

    I have done my figures and it looks like it will be April 2017 when we have what we need so I am going to have to knuckle down alot now and save more with my husband by that stage I will be 41 and he will be 43 really not ideal as we were planning on possibly starting a family once we had purchased a house as I feel more comfortable having a family knowing I own somewhere and am financially secure.
    Its all up in the air now


  • Options
    #30
    TrishSimon
    Closed Accounts Posts: 206 ✭✭TrishSimon


    Aka Ishur wrote: »
    Whats stopping you selling the apartment? Its highly unlikely you would get the mortgage when the rent is barely covering cost and if you are not benefiting from the asset why keep it?

    I should also correct my previous post too. Mortgage, maintence fee and life assurance on the apartment is 750.00 I take 740 rent from my tenant so I am not out as such, I could ask for 1000 pm but she also owns and rents her property in Wexford and she has been such a good tenant compared to previous ones who wrecked the place and caused me a fortune to get it repaired so as you can see I am not at a loss not a profit. Thanks


  • Advertisement
  • Options
    #31
    Aka Ishur
    Registered Users Posts: 740 ✭✭✭Aka Ishur


    TrishSimon wrote: »
    I should also correct my previous post too. Mortgage, maintence fee and life assurance on the apartment is 750.00 I take 740 rent from my tenant so I am not out as such, I could ask for 1000 pm but she also owns and rents her property in Wexford and she has been such a good tenant compared to previous ones who wrecked the place and caused me a fortune to get it repaired so as you can see I am not at a loss not a profit. Thanks

    Are you not planning on paying income tax on the 740? ;) All I am saying is be careful not to put your life on hold too long for the sake of a few euro. If you would be happier in a house starting a family its what I would seriously look at doing.


Advertisement