23-27yr old and saving for a house :(

jester77

skywalker wrote:

wow its another world, where you can get a house for 80K. Even if the did sell you 1.5 baths :eek:

It's Ireland that's the problem, you can also get a house here in Germany for €80k!

godtabh

jester77 wrote:

It's Ireland that's the problem, you can also get a house here in Germany for €80k!

You wont get a house in Manhattan for $80k. I'm sure the same would apply in central Berlin or the like.

Places with high population density will have higher house prices compared to some where of lower density.

I'd also think that building a house (excluding land just materials) would cost you more than €80k. It would be very difficult to buy a house for €80k if it costs €120k to build

conor_mc

kearnsr wrote:

You wont get a house in Manhattan for $80k. I'm sure the same would apply in central Berlin or the like.

Places with high population density will have higher house prices compared to some where of lower density.

I'd also think that building a house (excluding land just materials) would cost you more than €80k. It would be very difficult to buy a house for €80k if it costs €120k to build

Seriously - high density, we don't even know the meaning of it. Dublin is a sprawl to the size of L.A. with less than a quarter of the population.

In fairness, Ruu's €80k house was in a smallish college town in Illinois - so lets compare that with, say, Carlow or Athlone.... not many 4-beds there for €65k is there?

jester77

kearnsr wrote:

You wont get a house in Manhattan for $80k. I'm sure the same would apply in central Berlin or the like.

But you can get a house within commuting distance of the city center for that price!

kearnsr wrote:

I'd also think that building a house (excluding land just materials) would cost you more than €80k. It would be very difficult to buy a house for €80k if it costs €120k to build

I've no idea what it costs to build a house but if you look through here you will see houses on sale for 80k or lower.

godtabh

conor_mc wrote:

Seriously - high density, we don't even know the meaning of it. Dublin is a sprawl to the size of L.A. with less than a quarter of the population.

I never mention Dublin

conor_mc wrote:

In fairness, Ruu's €80k house was in a smallish college town in Illinois - so lets compare that with, say, Carlow or Athlone.... not many 4-beds there for €65k is there?

Not a like for like comparison. Factor construction costs, materials, labour, building type, construction practice etc

jester77 wrote:

But you can get a house within commuting distance of the city center for that price!

Look at the whole life costs not the inital down payment. There is qol issues, travel issues etc.

jester77 wrote:

I've no idea what it costs to build a house but if you look through here you will see houses on sale for 80k or lower.

Not a like for like comparison. Factor construction costs, materials, labour, building type, construction practice etc

jester77

jester77 wrote:

you can also get a house here in Germany for €80k!

kearnsr wrote:

You wont get a house in Manhattan for $80k. I'm sure the same would apply in central Berlin or the like.

Berlin and Manhattan?! The likes of Dublin Cork Galway Waterford or Kilkenny etc cities are hardly comparable to central Berlin or Manhattan Agreed!
Also agree with Jester:

jester77 wrote:

It's Ireland that's the problem,

Too True!

kearnsr wrote:

Not a like for like comparison. Factor construction costs, materials, labour, building type, construction practice etc

For 80 thousand dollars I will have their construction practice any day

galah

excuse my asking, but construction practice in the US came up - would this be in a negative way? (just curious...)

Cause I would not call Irish houses well (or even remotely decently) built...(but maybe I misunderstood?)

godtabh

galah wrote:

excuse my asking, but construction practice in the US came up - would this be in a negative way? (just curious...)

Cause I would not call Irish houses well (or even remotely decently) built...(but maybe I misunderstood?)

Its the same in any contry. The end result is same but they way its gona about is different.

The point I was making was that if you gave a builder in america and a builder in ireland a layout for a house and let them go build it you would get the same house but built differently with different materials and at a different cost.

In fairness I think we have gone way off topic

kearnsr

kearnsr wrote:

In fairness I think we have gone way off topic

Yeah I think so! SmcCarricks post has some truth in it - but I suspect some of these holidays and new cars are as a result of irresponsible borrowing and lending.

To buy your gonna need to save (unless you want 100% mortgage) and buying a house is always a big issue and people always have and always will give out about how hard it is.
However I do think that the balance has been tipped against the average punter the past few years. And about comparing foreign countries - the grass is always greener (sometimes it is and sometimes it isnt!) - but many western countries have property bubbles at the moment.

Dubh Geannain

I can't commit to the same job at the moment. I certainly won't be thinking of buying a house for another 5 or six years at least, if ever in this country. As another poster said, unless I get an unexected windfall, my opinion won't change.

Calina

People always had to work hard to buy houses, yes, but currently:

1) I earn X amount of euros per year. To be able to buy a house within 30 minutes of where I work, I need to have saved 2X amount of euros and then, I can get a mortgage for the balance. That is, the maximum mortgage I can get, plus two years gross salary will buy me a house.

I can't actually, without the help of maybe 10 years, save the equivalent of two full years gross salary.

So you say to me: lower your expectations. Buy an apartment instead. I look at apartments. Currently, a one bedroomed apartment near where I work is some six times my gross salary. According to my calculations, to buy one of them, I need the maximum available mortgage, plus the equivalent of one year's gross salary by way of a deposit.

I have raised and lowered my expectations a lot of times. I earn enough to be more than comfortably shoved into the higher tax bracket, but not enough to acquire something on the latest affordable housing initiative. The point I am makig - right now - is no matter how hard someone like me saves, I will wind up with money at the end, but not enough to get a house or an apartment near where I live. The truth is, there are a lot of people out there that even i you tell them to save very hard...they are still cornered right now regardless.

Most comments along the lines of "it was always hard" I find are used to justify it still being hard. But you also have to look at it in other contexts. Banks have loaned more and more and more money - and it is still hard. When I came back to Ireland 8 years ago, you were talking 92% mortgages and 3X principle salaries. Now it's 100% and up to 5 or 6 times principle salaries. And people still can't afford houses regardless how hard they save.

In my opinion, many people in Ireland have completely lost sight of reality here. I have spent a good deal of time doing maths, a good deal of time visiting houses and I have spoken to a lot of bank people. People have told me to do everything to get on the ladder. I have looked at the bottom rung of that ladder - a one bedroomed apartment say - and questioned how I could possibly live in such accommodation. I've looked at a lot of them. They are not designed for people to live in. An awful lot of property built in the last five years, as far as I can see, has very little utility value. Kitchens off living rooms with no doors. Living rooms which no wall against which you can put a sofa. Kitchens with no worktop space.

So I look at the bottom run of the ladder and think it's not worth it. A lot of Irish people don't look at things critically. The key question which a lot of people have never answered is "can I live here if things go terribly wrong...".

I don't know when the housing market is going to magic itself into a rational market. I heard someone on Newstalk yesterday saying we were very lucky, we had achieved the soft landing. But we're only two months into what appears to be a correction. I thought the soft landing was property prices rising with inflation. But that's not what is happening. They are going into reverse - to the tune of less than a per cent - but in the face of inflation at 5% or so, that's hardly good news to begin with. And asking prices are off by up to 10% - and falling for many properties.

It's one thing for property to be very hard to afford when interest rates are 7%. If it's very hard to afford when they are 2% and rising - and now nearly 4% how much harder is it going to get? I keep hearing about how things are "different" here, that this fundamental, that that fundamental, immigration this, immigration that. If local people can't afford to buy houses, in the name of Christ, how rich will an immigrant have to be to afford to buy a house here? And really, how much would you want to given all the other grief there is in this country? I think we'll need an awful lot of them to fall in love with locals to be sure they will prop up the local property market too.

The_Conductor

Calina wrote:

So you say to me: lower your expectations. Buy an apartment instead. I look at apartments. Currently, a one bedroomed apartment near where I work is some six times my gross salary. According to my calculations, to buy one of them, I need the maximum available mortgage, plus the equivalent of one year's gross salary by way of a deposit.

Is it worth lowering your expectations in terms of what you want to buy. Surely the logical thing may actually be to lower your expectations in terms of *where* rather than *what* you want to buy? A 30 minute commute (or longer) is not bad- if its on reliable public transport and the location of your property is in an area that you are happy enough with.

Calina wrote:

I have raised and lowered my expectations a lot of times. I earn enough to be more than comfortably shoved into the higher tax bracket, but not enough to acquire something on the latest affordable housing initiative. The point I am makig - right now - is no matter how hard someone like me saves, I will wind up with money at the end, but not enough to get a house or an apartment near where I live. The truth is, there are a lot of people out there that even i you tell them to save very hard...they are still cornered right now regardless.

Do you have to live near where you are at the moment? I asked myself that back 8 years ago when I was renting in Rathmines. I'd love to live there- I couldn't afford it then, and I certainly can't now. Re: affordable housing- a single person earning over 70k will still qualify for affordable housing in some areas of Dublin- a rather bizzare situation. The property market is an unmitigated mess.

Calina wrote:

In my opinion, many people in Ireland have completely lost sight of reality here. I have spent a good deal of time doing maths, a good deal of time visiting houses and I have spoken to a lot of bank people. People have told me to do everything to get on the ladder. I have looked at the bottom rung of that ladder - a one bedroomed apartment say - and questioned how I could possibly live in such accommodation. I've looked at a lot of them. They are not designed for people to live in. An awful lot of property built in the last five years, as far as I can see, has very little utility value. Kitchens off living rooms with no doors. Living rooms which no wall against which you can put a sofa. Kitchens with no worktop space.

Very very true. People have this "buy property at any cost" mantra- irrespective of what you are actually buying. From what I see- the property market in the last few years has been an excellent manner of extracting money from FTBs and those trading up and transferring it to a tripartate of 1) the Older Generation, 2) Developers and 3) the Government. People seem to have lost track of all fundamentals. You are very right to question the feasibility of living long term in a lot of the boxes built recently.

Calina wrote:

I don't know when the housing market is going to magic itself into a rational market. I heard someone on Newstalk yesterday saying we were very lucky, we had achieved the soft landing. But we're only two months into what appears to be a correction. I thought the soft landing was property prices rising with inflation. But that's not what is happening. They are going into reverse - to the tune of less than a per cent - but in the face of inflation at 5% or so, that's hardly good news to begin with. And asking prices are off by up to 10% - and falling for many properties.

Soft landing my arse. The market in FTB boxes (errr apartments, if you want to stretch the imagination)- is being badly held together by developers offering to pay your first 6 or 9 months of mortgage, and even then asking prices in new developments are falling. There is no definition of a softlanding- one Galway developer that I was talking to says that a 30-40% fall would be a soft landing in his reckoning. Ouch..... Re: Falling prices in an era of inflation- the fall in real prices is thus inflation rate + actual fall- e.g. in the second hand market a 10% fall + inflation = a real fall of 15%. That is where we are at the moment.

Calina wrote:

It's one thing for property to be very hard to afford when interest rates are 7%. If it's very hard to afford when they are 2% and rising - and now nearly 4% how much harder is it going to get? I keep hearing about how things are "different" here, that this fundamental, that that fundamental, immigration this, immigration that. If local people can't afford to buy houses, in the name of Christ, how rich will an immigrant have to be to afford to buy a house here? And really, how much would you want to given all the other grief there is in this country? I think we'll need an awful lot of them to fall in love with locals to be sure they will prop up the local property market too.

There is a difference in Irish fundamentals- in that hitherto the property market has been largely underpinned by inward migration- which in turn propped up the rental market. Thus people were willing to buy property for letting purposes, totally ignoring the rental yield, secure in the knowledge that the deficit would be more than offset by the appreciation in property prices- something that is now in freefall. So- instead of a rise in property prices, they are falling- so a correction in rental yield ratios is underway- and a shipload of this property that just cannot pay for itself in rental yield is hitting the market- the knockon effect having a domino effect- leading to more and more people determined to exit at any cost.

In the midst of all of this- the favourable tax regime that brought a lot of multi-nationals to Ireland, has been undercut by some of the new member states- which means the net inward migration has now slowed in all but the construction industry and the public sector (notably nursing) (uhohhh.....)

So- the inward migration which underpined the spectacular rise in property prices is under question..... In addition- a lot of the multinational construction workers are simply economic migrants, rather than immigrants, and have no intention of staying here for long- e.g. London is going to need a load of them with the upcoming olympics shortly- so......

Just why people seem to be immune to putting two and two together is a little beyond me.

The upcoming election with Stamp Duty as an election issue, don't get me started. If they double the bands to say 650k duty free for all, and then all excess on a pro-rata basis- it might be tempting for those hoping to tradeup at some point in the future. It offers sfa for FTBs though- the majority of whom are below the cut-off anyway.

At the moment your rent is a lot lower than interest payments on a mortgagee for a similar property would be (and you also do not have to worry about falling asset prices) surely what you should do is obvious?

slickmcvic

wow...scary stuff,turnin 27 in August,No chance of affordin anythin where I live at this rate,Have a decent job drive a sporty car(which i've got an 8K loan for!),headin on an american roadtrip in June and I still feel like I'm only outta Uni and should be enjoyin meself!!
I hate this social pressure to invest in somethin...I keep thinkin a mortgage is gonna be end of the good times so I'm tryin to get my livin done now while I still can!!....I think I'm typical of a lot my age ...wanna have my cake and eat it!!!

Peter Collins

ChRoMe wrote:

If I ever buy property it wont be in Ireland. I dont understand friends of mine getting 400k loans and buying houses here. It really doesnt seem to be value for money for the type of house that you get. I'd quicker buy two apartments abroad somewhere and rent them out.

:rolleyes:

dear oh dear