Buying Privately v Affordable Housing

d-redser

Hey everyone,

Just need a little advice please.

I am 28 and new to all this mortgage and affordable housing schemes, and being honest I do not understand it completely.

Just recently broke up with someone and now back in my mam's (yay me :rolleyes:) so I need to start saving and get my own place.

I am lucky that I don't have to pay any rent here as long as I am saving for my own place. But this is where the problem starts.

I have no savings, I am on pretty ****ty wages (but definetly will get better after a while). I am on €380 a week and I have to pay out €120 for credit union :eek: each week (that is the lowest it will go down).

I can afford to save between €100-150 per week though.

Does anyone know what my options are roughly?

I know I am best to speak with a broker but just want to get some basic info from here frist.

Moonbeam

Save as much as you can, and then when your wages are higher have a look at the housing market again.

I don't think you would be able to pay a mortgage and bills and live on that income.

jdivision

Is that income pre or post tax. If it's pre-tax the max mortgage you'll get is e100k and unfortunately in Dublin it's unlikely you'll get anything for that

punchestown

Apply to the affordable housing and hope that prices continue to fall in the meantime.

d-redser

jdivision wrote: »

Is that income pre or post tax. If it's pre-tax the max mortgage you'll get is e100k and unfortunately in Dublin it's unlikely you'll get anything for that

Sorry that is after tax.

I never mentioned that I do overtime quite a lot and my wages would be around €450-500 after tax..

The_Conductor

d-redser wrote: »

Sorry that is after tax.

I never mentioned that I do overtime quite a lot and my wages would be around €450-500 after tax..

450-500 after tax- is not bad at all. If you are on this level of earnings though- and serious about getting your own place, you would want to be saving more than 100-150 a week. I would suggest accelerating your Credit Union loan repayments in the shortterm- as you're probably paying more in interest there than you will ever get in any financial institution on savings- so you will effectively be killing two birds with the one stone.

As per above- I would apply for the affordable housing scheme- but wouldn't be too eager to hop onto the property ladder in the current market. Stats on RTE news last night are that Apartment prices fell by 17% in Dublin in 2007 and are continuing to fall- and house prices fell by 10%. With the global economy going the way it is- the writing is on the wall......

d-redser

smccarrick wrote: »

450-500 after tax- is not bad at all. If you are on this level of earnings though- and serious about getting your own place, you would want to be saving more than 100-150 a week. I would suggest accelerating your Credit Union loan repayments in the shortterm- as you're probably paying more in interest there than you will ever get in any financial institution on savings- so you will effectively be killing two birds with the one stone.

As per above- I would apply for the affordable housing scheme- but wouldn't be too eager to hop onto the property ladder in the current market. Stats on RTE news last night are that Apartment prices fell by 17% in Dublin in 2007 and are continuing to fall- and house prices fell by 10%. With the global economy going the way it is- the writing is on the wall......

I plan on saving around €150 per week.

I dont understand what you mean by acclerating my credit union loan though Being honest most of this house talk goes straight over my head .

The_Conductor

d-redser wrote:

I plan on saving around €150 per week.

I dont understand what you mean by acclerating my credit union loan though Being honest most of this house talk goes straight over my head .

What I mean is try to repay your credit union load asap- particularly as it will establish a repayment record for you.

When I was suggesting you try to save more than 150 a week- what I was trying to say is you saving 600 a month is only the equivalent of making mortgage payments on a mortgage of less than 140,000. Even on the affordable housing scheme- you would be very lucky to get a one bed apartment in an undesireable area for 140k. If you can show a history of saving a good deal more than this- particularly now that you are living at home and do not have massive outgoings- it will work in your favour when you go to try to borrow money for your apartment/house. Saving 150 a week- less than 1/3 of our net take home pay- when you are living at home- isn't showing a great repayment capacity on your part.

Irrespective of buying either privately or on the affordable housing scheme- you have to keep in mind that your living expenses will be a lot higher when you have your own house than when you are living at home- annual management charges will probably be between 1500 and 3000 (depending on the development- they may even be higher- mine are about 4 weeks net pay ). Monthly ESB/NTL/Gas/Phone/Internet etc- are all pricey. I don't know if you have experience of running a household budget- but establishing a record of being able to put away a considerable portion of your income while living at home- was what I had in mind with my suggestion.

Hope this helps,

Shane

d-redser

smccarrick wrote: »

Hope this helps,

Shane

Yes it definetly does.. something for me to think and plan before i decide on anything..

Thanks Shane