Will the property market pick up within the next 2 years

niamh4626

Hey,


I have a project due in for college entitled

"The property market cannot recover within the next 2 years."

I would appreciate sone opinions on this statement which will aid me in my project!!


Thanks

Niamh

Lemming

Instead of asking boardsies to do your homework for you, why not do some research, give your thoughts/impressions and then ask for inputs.

Assuming of course the moderators approve of this.

whizzbang

No

I leave it as an exercise to the reader to figure out why.


clue: http://daftwatch.atspace.com/

El Stuntman

another clue as to why Whizzbang is right

that number is going into two digits, how do you think that impacts abaility to repay mortgages?

also consider the ludicrous oversupply of gaffs (+300k empties)

stevedublin

Stuntman, I think Whizzbag is trying to say that the property market will recover within the next two years because interest rates are coming down, increasing peoples ability to borrow/make repayments.

ZYX

niamh4626 wrote: »

Hey,


I have a project due in for college entitled

"The property market cannot recover within the next 2 years."

I would appreciate sone opinions on this statement which will aid me in my project!!


Thanks

Niamh

Obviously the market can recover within the next 2 years. Whether it will or not is a different question. Also what do you mean by recover.

whizzbang

stevedublin wrote: »

Stuntman, I think Whizzbag is trying to say that the property market will recover within the next two years because interest rates are coming down, increasing peoples ability to borrow/make repayments.

Sorry Stevedublin, but Stuntman had it right. I dont' think we will recover within the next 2 years as there is a huge oversupply of properties on the market. This massive backlog needs to be sold or removed from the market before prices will stop falling, let along start to recover.

Even if they dropped interest rates to zero there is so much supply of housing that it will take a long time before enough are sold to offer an price support.

El Stuntman

stevedublin wrote: »

Stuntman, I think Whizzbag is trying to say that the property market will recover within the next two years because interest rates are coming down, increasing peoples ability to borrow/make repayments.

I'm sure Whizzbang would contradict your assertion!

but let's try a quick argument as to why house prices are going to 'recover within the next two years'

pros:

1. interest rates are coming down. True!

er, that's it. There are no other possible price supports.

cons:

1. banks lending criteria have tightened massively - meaning that mortgages are much, much harder to get than during the years of the FF credit bubble

2. unemployment is going up. Way Up. The most optimistic forecast is that it will hit 8% next year. Personally, I think it will go through 10% and stay there for a long time (5 years+).

3. there are already 300,000 empty dwellings in the state. i.e. massive oversupply. Another reason (the biggest one of all) as to why prices will continue to fall.

4. a resumption of net emigration trends. The East Europeans are going home as our ecomony deteriorates. Many Irish are following them.

5. The Government finances are screwed irredemably (even though they don't seem to have realised this yet). There is no more money available for artifical price supports to the housing market inthe guise of mortgage interest relief etc. The builders bailout of 1.65bn proposed in the budget may very well be ruled illegal by Brussels.

6. The International economy, and particularly that of the US, is entering a huge downturn. Protectionist winds are blowing everywhere. The prospects for FDI into Ireland are terrible - we have thrown away almost all of our competitive advantages over the last ten years.

7. We have a uniquely incompetent government. Our Finance Minister is clueless beyond belief (in the realm of economics anyway, he was a good Justice Minister in fairness) as is our Tanaiste. Our Taoiseach appears totally out of his depth.

I could think of more but you get the jist.

Further heavy price falls (another 40%+ on top of the current falls from peak) are (a) inevitable, (b) necessary and (c) desirable.

whizzbang

It definitely wouldn't be wyse to buy now anyway.

niamh4626

I absolutly agree whizzbang, renting or living at home with the mammy is the only way to go for the foreseeable future.....!!!!!

Theboinkmaster

El Stuntman wrote: »

I'm sure Whizzbang would contradict your assertion!

but let's try a quick argument as to why house prices are going to 'recover within the next two years'

pros:

1. interest rates are coming down. True!

er, that's it. There are no other possible price supports.

cons:

1. banks lending criteria have tightened massively - meaning that mortgages are much, much harder to get than during the years of the FF credit bubble

2. unemployment is going up. Way Up. The most optimistic forecast is that it will hit 8% next year. Personally, I think it will go through 10% and stay there for a long time (5 years+).

3. there are already 300,000 empty dwellings in the state. i.e. massive oversupply. Another reason (the biggest one of all) as to why prices will continue to fall.

4. a resumption of net emigration trends. The East Europeans are going home as our ecomony deteriorates. Many Irish are following them.

5. The Government finances are screwed irredemably (even though they don't seem to have realised this yet). There is no more money available for artifical price supports to the housing market inthe guise of mortgage interest relief etc. The builders bailout of 1.65bn proposed in the budget may very well be ruled illegal by Brussels.

6. The International economy, and particularly that of the US, is entering a huge downturn. Protectionist winds are blowing everywhere. The prospects for FDI into Ireland are terrible - we have thrown away almost all of our competitive advantages over the last ten years.

7. We have a uniquely incompetent government. Our Finance Minister is clueless beyond belief (in the realm of economics anyway, he was a good Justice Minister in fairness) as is our Tanaiste. Our Taoiseach appears totally out of his depth.

I could think of more but you get the jist.

Further heavy price falls (another 40%+ on top of the current falls from peak) are (a) inevitable, (b) necessary and (c) desirable.

Great post - agree with everything

DennisSabre

Maybe add a subtitle to your project:

"A property is not just for profit, it's a home for life"

EnoughSaid

niamh4626 wrote: »

Hey,


I have a project due in for college entitled

"The property market cannot recover within the next 2 years."

I would appreciate sone opinions on this statement which will aid me in my project!!

You will find plenty of information at:

www.thepropertypin.com

Oshare Bones

I don't think property prices will pick up within the next 2 years.

jetski

OP - Did you give the project the title?

Kinda shallow if you did or not.... no body can say whats 2 years down the line never mind 6 months....

If you want to know what i would....

Look at other property booms worldwide that have happened over the years and avoid making any predictions based on what you find.

3 observations ive made counter your projects title....

1. The budget announcement of increased mortgage interest relief.

2. Interest rates are seriously plummeting

3. possibly coincidence but the last few reports on irishpropertywatch.com have seen consecutive slowing in the amounts of people dropping asking price and also the stock of unsold propertys has dropped quite significantly.


Wouldnt mind a look at the finished product

El Stuntman

jetski wrote: »

3. possibly coincidence but the last few reports on irishpropertywatch.com have seen consecutive slowing in the amounts of people dropping asking price and also the stock of unsold propertys has dropped quite significantly.

that's odd as daftwatch is showing the for sale total as being flat at around 73k since July. Not doubting your stat but it seems odd in the light of this?

jetski

I think thats because daftwatch is based only on daft and irishpropertywatch.com is on more than one site

KhanTheMan

noone really know what going to happen. Anyone telling you they do know are talking through their arse. All people can do is guess.

Cant wait though, to see what happens when interest rates go down, mortgage interest relief goes up and couples find that its actually a hell of a lot cheaper to buy than to rent.

Or what will happen when noone has a job to even get a salary to get a mortgage. It could go anyway at the moment.

bangersandmash

KhanTheMan wrote: »

Cant wait though, to see what happens when interest rates go down, mortgage interest relief goes up and couples find that its actually a hell of a lot cheaper to buy than to rent.

If you're talking about anything larger than a 2 bed in Dublin, things have an awfully long way to go before it'll be "a hell of a lot cheaper".

KhanTheMan

bangersandmash wrote: »

If you're talking about anything larger than a 2 bed in Dublin, things have an awfully long way to go before it'll be "a hell of a lot cheaper".

Talking about starter homes in Dublin.

bangersandmash

KhanTheMan wrote: »

Talking about starter homes in Dublin.

At current price levels, 1-2 bed apartments are only occasionally cheaper in new developments in less desirable areas where BTL landlords often have unrealistic expectations about rents. For 3+ beds in decent locations with amenities we still have a long way to go before it's substantially cheaper to buy than rent.

gurramok

bangersandmash is bang on.

One thing is forgetten. Non-ftb relief is going down in Jan by 5%. We have an income levy being imposed next month so that extra cash for existing and new holders has just evaporated.
And we have not yet discussed the impending bad debts at the banks. They cannot afford to give out 'cheap' mortgages.
http://www.rte.ie/news/2008/1105/aib.html

The bank said it does not expect a 'meaningful' recovery in the residential market until 2011.

AIB Group, Ireland's biggest bank, said bad debts, largely because of loans to residential property developers in Ireland, would increase this year and next, well beyond the bank's and analysts expectations.

Worries over loans to property developers lead the group to reduce its earnings forecast for the rest of the year to €1.20.

KhanTheMan

bangersandmash wrote: »

At current price levels, 1-2 bed apartments are only occasionally cheaper in new developments in less desirable areas where BTL landlords often have unrealistic expectations about rents. For 3+ beds in decent locations with amenities we still have a long way to go before it's substantially cheaper to buy than rent.

Im havent time to write out the figures for you here but its easy to work out for yourself.
Go look up some starter homes in reasonable areas and then work out how much a couple will pay on a 90% mortgage or less including all of their interest relief.

ZYX

gurramok wrote: »

bangersandmash is bang on.

One thing is forgetten. Non-ftb relief is going down in Jan by 5%. We have an income levy being imposed next month so that extra cash for existing and new holders has just evaporated.

Both these points are pretty irrelevant except for the "mood" they create around the property market. We are realistically looking at at least a 1% drop in interest rates in next 12 months and more likely 2%.

El Stuntman

I like to put my money where my mouth is...so I'm more than happy to book a spread bet with anybody who wishes to bet that house prices are going up in the next two years.

We take the PTSB\ESRI Index (by no means perfect but the only measure we have) as the base and book the action at €€€ per percentage point increase\decrease.

Thus if we take a base of 100 as the starting index and prices increase by 10% over the next two years, say we agreed the bet at €100 per point, I would pay you €1,000

v.v. for a decrease.

we would have to arrange to escrow monies with a reputable third party.

Any takers?

punchestown

El Stuntman wrote: »

I like to put my money where my mouth is...so I'm more than happy to book a spread bet with anybody who wishes to bet that house prices are going up in the next two years.

We take the PTSB\ESRI Index (by no means perfect but the only measure we have) as the base and book the action at €€€ per percentage point increase\decrease.

Thus if we take a base of 100 as the starting index and prices increase by 10% over the next two years, say we agreed the bet at €100 per point, I would pay you €1,000

v.v. for a decrease.

we would have to arrange to escrow monies with a reputable third party.

Any takers?

Are you betting on them going up or down?

travellerI

OP

I dont know what you are studying and who set you this assignment but if you look at property in this country as a market then it is a question of economics.

Economic analysis is based inter alia on the principles of supply and demand.

Lets look at the supply side. Depending on who you believe there are between 100,000 and 300,000 empty properties in Ireland.

Look at the demand side.

I dont know how many First Time buyers or trader uppers there are out there but I seriously doubt if the number comes any where close to the supply figures. Given that some of these unoccupied houses are on the side of mountain in the middle of nowhere - it is arguable that many of these properties are unsellable. Add in one bed apartments in cities to that equation and you have a big problem.

In my view a better economic question would be when will the irish property market return to equilibrium and at what cost to the country and its people?

The above argument is a simple one, I havent mentioned interest rates, unemployment levels, inflation, property investment etc., etc. but you have to do some work yourself.


regards


travellerI

KhanTheMan

El Stuntman wrote: »

I like to put my money where my mouth is...so I'm more than happy to book a spread bet with anybody who wishes to bet that house prices are going up in the next two years.

We take the PTSB\ESRI Index (by no means perfect but the only measure we have) as the base and book the action at €€€ per percentage point increase\decrease.

Thus if we take a base of 100 as the starting index and prices increase by 10% over the next two years, say we agreed the bet at €100 per point, I would pay you €1,000

v.v. for a decrease.

we would have to arrange to escrow monies with a reputable third party.

Any takers?

are there property bulls here?

good luck getting someone to bet a grand with a random person on the internet. Surley a bookie will take a bet with you on anything you choose.

KhanTheMan

travellerI wrote: »

Given that some of these unoccupied houses are on the side of mountain in the middle of nowhere - it is arguable that many of these properties are unsellable.

Good point.
I'd love to get an actual figure on the amount of properties above. They might as well just take them out of the supply list because im thinking that all of these in the like of leitrim, roscommon etc cant even be given away.

El Stuntman

punchestown wrote: »

Are you betting on them going up or down?

lol, down obviously!

El Stuntman

KhanTheMan wrote: »

are there property bulls here?

good luck getting someone to bet a grand with a random person on the internet. Surley a bookie will take a bet with you on anything you choose.

I do have nearly 5k posts on Boards and have engaged in lots of prop bets with people on the poker forum in the past. They have all been paid in full on losing bets (and I've always been paid on winning ones). References available on request if you are genuinely interested.

(btw, not sure how much you know about gambling but this is a better proposition than betting with a bookie)

ZYX

travellerI wrote: »

OP


Lets look at the supply side. Depending on who you believe there are between 100,000 and 300,000 empty properties in Ireland.

Look at the demand side.

I dont know how many First Time buyers or trader uppers there are out there but I seriously doubt if the number comes any where close to the supply figures. Given that some of these unoccupied houses are on the side of mountain in the middle of nowhere - it is arguable that many of these properties are unsellable. Add in one bed apartments in cities to that equation and you have a big problem.


The above argument is a simple one, travellerI

It's a very simple argument. To sumarize
1 There are loads of properties for sale but I have no idea how many.
2 I have no idea how many buyers are out there but there must be very few.
Indeed some would say that is not an argument at all.

SimpleSam06

ZYX wrote: »

Both these points are pretty irrelevant except for the "mood" they create around the property market. We are realistically looking at at least a 1% drop in interest rates in next 12 months and more likely 2%.

ECB interest rates are becoming more irrelevant as they diverge from Euribor and Libor rates. That's why the banks closed the tap on tracker mortgages lately, and also why you haven't seen major drops in mortgage repayments for most people - the banks apparently have to "refilll their coffers" after their big scare.

ZYX

SimpleSam06 wrote: »

ECB interest rates are becoming more irrelevant as they diverge from Euribor and Libor rates. That's why the banks closed the tap on tracker mortgages lately, and also why you haven't seen major drops in mortgage repayments for most people - the banks apparently have to "refilll their coffers" after their big scare.

If mortgage rates fall by 0.2% that will negate the effect of the budget changes.

El Stuntman

ZYX wrote: »

If mortgage rates fall by 0.2% that will negate the effect of the budget changes.

yes but remember that the budget is already hopelessly inadequate (as Lenihan can't add or subtract)

there's a mini budget on the way early next year and expect more tax hikes to offset ECB reductions.

gurramok

ZYX wrote: »

Both these points are pretty irrelevant except for the "mood" they create around the property market. We are realistically looking at at least a 1% drop in interest rates in next 12 months and more likely 2%.

As said, it will help existing trackers as long as the govt 'don't claw it back' through other taxation methods. Public deficits of 7-10% of GDP are a phone call to IMF territory, expect many taxes/cut backs to occur which will further depress national income.

IR's of 1-2% less will not help prices recover. The banks use Euribor for their rates.
Even in the US, rates of less than 2% have not helped their housing market as the banks still charge 5%+ rates for borrowers.

To sum up, don't expect the banks to start offering 2-4% rates to borrowers here on the back of ECB rate cuts in the near future as they have serious bad debts to clear up and in simple language, they need every cent they can get.

So to OP, based on what has been detailed in the thread, it will be many years before prices recover on a steady upward track.

KhanTheMan wrote:

Good point.
I'd love to get an actual figure on the amount of properties above. They might as well just take them out of the supply list because im thinking that all of these in the like of leitrim, roscommon etc cant even be given away.

Yes they are. Alot in the major cities too. I've seen hundreds of empty apts myself.
The 300,000+ figure is based on ESB connections and CSO census data. I quote from 2Pack on the Pin:

The 350,000 figure is predicated on the ESB confirming that there are 2m domestic connections today ( + or - 10,000) .

The ESB domestic connections stats correlated very tightly with the census data .

The ESB Had 1.77m connection at end 2005 , the census 4 months later found 1.8m homes in total . We built the difference in that time

Sadly the most recent ( and previous years) ESB data is from End 2006 Here but the growth in Connections in 2006 together with construction completions since that date points to 2m Domestic Connections right now , Q4 2008 .

Yet our population of 4.43m and at 2.7 persons per household (because average household sizes drop .1 every 2.5 years and was 2.8 at census time 2.5 years ago) only requires 1.64m homes .

This points to 360k empties but allowing for ESB ' connections' that are not really habitable it should be about 350k .

The only way it could go lower than 350k is if net immigration increased but it is now likely that net immigration is , in actual fact , negative

earlyevening

Did I hear correctly on the radio that AIB are expecting a 40% further fall in value of undeveloped land and a 30% further fall in residential property. It also said their share price fell 17% on the back of this.

If thats what they admit to, expect worse.

I say sell, sell, sell (if you can find a naive enough buyer).

quote: from Irish Times
AIB said its €10.7 billion portfolio of residential development in Ireland had seen a more severe deterioration and it does not expect a recovery in this market until 2011. It expects a fall in values of 40 per cent for undeveloped land, of which the bank has a €7 billion loan book and 30 per cent for residential houses which account for the remainder.

SimpleSam06

gurramok wrote: »

So to OP, based on what has been detailed in the thread, it will be many years before prices recover on a steady upward track.

And even that will be a shallow slope.

bangersandmash

KhanTheMan wrote: »

Im havent time to write out the figures for you here but its easy to work out for yourself.
Go look up some starter homes in reasonable areas and then work out how much a couple will pay on a 90% mortgage or less including all of their interest relief.

Pity. I've done the figures myself now and in the past. They don't even remotely stack up for 3+ beds in "reasonable" areas.

As a prime example look at Phibsboro, an average area with plenty of small family homes. You can buy a 3 bed mid terrace for 585k (previously 630k). Assuming a deposit of 58k, BOI will currently give you a 35 year mortgage for €2,756.13 per month before interest relief. Alternatively you can rent a similar 3 bed redbrick midterrace around the corner for €1200 per month. Neither represent good value in my mind as they're both in relatively poor condition, but the comparison stands.

There's nothing special about Phibsboro in this example. You'll find the same thing in Windy Arbour or Cabra. You'll find more exteme cases in Ballinteer or Raheny. And if you want real entertainment, look at buy versus renting comparisons for the likes of Monkstown, Rathgar, Howth, Sandymount etc etc.

The only examples I've seen in the media for Dublin are 1-2 beds in certain poorly-built developments in Ballymun, Finglas or Tallaght, or occasionally small apartments in certain parts of the inner city that command high rents due to convenience. If that's what you mean by a starter home in a reasonable area, fair enough. But at least be up front about it.

KhanTheMan

bangersandmash wrote: »

Pity. I've done the figures myself now and in the past. They don't even remotely stack up for 3+ beds in "reasonable" areas.

As a prime example look at Phibsboro, an average area with plenty of small family homes. You can buy a 3 bed mid terrace for 585k (previously 630k). Assuming a deposit of 58k, BOI will currently give you a 35 year mortgage for €2,756.13 per month before interest relief. Alternatively you can rent a similar 3 bed redbrick midterrace around the corner for €1200 per month. Neither represent good value in my mind as they're both in relatively poor condition, but the comparison stands.

There's nothing special about Phibsboro in this example. You'll find the same thing in Windy Arbour or Cabra. You'll find more exteme cases in Ballinteer or Raheny. And if you want real entertainment, look at buy versus renting comparisons for the likes of Monkstown, Rathgar, Howth, Sandymount etc etc.

The only examples I've seen in the media for Dublin are 1-2 beds in certain poorly-built developments in Ballymun, Finglas or Tallaght, or occasionally small apartments in certain parts of the inner city that command high rents due to convenience. If that's what you mean by a starter home in a reasonable area, fair enough. But at least be up front about it.

You pick those areas. I can tell you now. Average First time buyers will never be able to afford any house in those areas you specified. But i expected that kind of argument. If you're not going to be realistic in your definition of a starter home is a reasonable area then there is no point even trying to argue with you at all.

Just as a matter of interest - could you not find any 3 bed house for less than €585K in phibsboro? There are plenty.

Seems to me you went out of your way here to suit your side of the fence here. Waste of time even trying to get you to look for some facts yourself isnt it.

for the record. im guessing house prices will fall further. im just pointing out one scenario in a specific market segment. the facts are there if you care to look them up without the bias you've used in your example above.

bangersandmash

KhanTheMan wrote: »

You pick those areas. I can tell you now. Average First time buyers will never be able to afford any house in those areas you specified. But i expected that kind of argument. If you're not going to be realistic in your definition of a starter home is a reasonable area then there is no point even trying to argue with you at all.

Can you read? I wasn't suggesting that an FTB was going to go buy in Sandymount. I listed a range of areas at different price ranges pointing out that there are rent V buy discrepancies across Dublin.

So which reasonable areas are you talking about exactly? Does your definition rule out 90% of the city?

With the greatest respect, Phibsboro is a working-class area full of what would have until very recently been called starter family homes for average wage earners (ie not an area consisting solely of 1-2 shoeboxes).

KhanTheMan wrote: »

Just as a matter of interest - could you not find any 3 bed house for less than €585K in phibsboro? There are plenty.

Sure I picked a house at €585k. For renting to be cheaper in that area than buying you'd have to quick an equivalent 3 bed for about €280k at the very most (ie 50%+ lower) . Have you found one? Maybe €440k, but certainly nothing 50% lower.

KhanTheMan wrote: »

Waste of time even trying to get you to look for some facts yourself isnt it.

The funny thing is you haven't provided any facts whatsoever. I've yet to see where these starter homes exist that are in "reasonable areas", that aren't 1-2 bed apartments, and that are "a hell of a lot cheaper to buy than to rent".

KhanTheMan

bangersandmash wrote: »

Can you read? I wasn't suggesting that an FTB was going to go buy in Sandymount. I listed a range of areas at different price ranges pointing out that there are rent V buy discrepancies across Dublin.

So which reasonable areas are you talking about exactly? Does your definition rule out 90% of the city?

With the greatest respect, Phibsboro is a working-class area full of what would have until very recently been called starter family homes for average wage earners (ie not an area consisting solely of 1-2 shoeboxes).


Sure I picked a house at €585k. For renting to be cheaper in that area than buying you'd have to quick an equivalent 3 bed for about €280k at the very most (ie 50%+ lower) . Have you found one? Maybe €440k, but certainly nothing 50% lower.


The funny thing is you haven't provided any facts whatsoever. I've yet to see where these starter homes exist that are in "reasonable areas", that aren't 1-2 bed apartments, and that are "a hell of a lot cheaper to buy than to rent".

Dont know about you but i would consider Phibsborough a very sought after area, but thats neither here nor there.

you're getting a bit defensive here.
All im asking you to do is go and work out the figures for yourself. It might stick a bit better if you do it yourself instead of going la la la la la.

Heres a little help for you.

Lets just take an ordinary scenario for a couple wanting to buy a house in Dublin, who are renting a 2 bed apartment or house for €1200 - €1300 or so.

A couple buying their first home would be looking for a 2 or 3 bed house or apartment that they can afford to buy.

So, just for arguments sake, do a search in Dublin for 2 and 3 bed houses and apartments for under €300k. Im sure there will be a lot more available under that price too in the coming year too.

So now they are looking for a mortgage of about €270k after they pay their deposit. What are they paying after mortgage interest relief? What will the effect of the expected 1 - 2% interest rate reduction over the next year be?

Just an example. Millions of other scenarios.

Rent can be higher or lower.
House price can be higher or lower.
Deposit may be higher or lower.
Term of mortgage may be shorter or longer.


I know it pains you, but would you not say that its possible for a couple to buy a house in Dublin for less than it is costingI them to rent it?

BendiBus

How about Crumlin as a battleground for you both?

2 end of terrace houses pretty close to each other.

One for sale at 300K (would accept 270K?) 10 Lismore Road

One for rent at 1150pcm 78a Monasterboice Road

Someone do the sums for me as I can't be arsed

JuliusCaesar

BendiBus wrote: »

Someone do the sums for me as I can't be arsed

You don't have to do the sums! jeacle will do them for you!

http://www.jeacle.ie/mortgage/ie/

250K over 20yrs at 5.2% = 1668pm

BendiBus

JuliusCaesar wrote: »

You don't have to do the sums! jeacle will do them for you!

http://www.jeacle.ie/mortgage/ie/

250K over 20yrs at 5.2% = 1668pm

Over 25 years is 1490. What's the interest relief? €133?

Say €1350pm to buy versus €1150 to rent? Only €200pm to own rather than rent?

2 random houses, back of envelope calculations etc. but that's interesting. And surprises me!

martian1980

BendiBus wrote: »

Over 25 years is 1490. What's the interest relief? €133?

Say €1350pm to buy versus €1150 to rent? Only €200pm to own rather than rent?

2 random houses, back of envelope calculations etc. but that's interesting. And surprises me!

'twould be well and good if every bank and economist wasn't shouting from the rooftops that things have further to fall...

IanCurtis

What is a "manket"?

Look how far the 'r' and the 'n' are on a keyboard...that's a shocking error. These are the future Graduates of this country....oh God.

spockety

IanCurtis wrote: »

What is a "manket"?

Look how far the 'r' and the 'n' are on a keyboard...that's a shocking error. These are the future Graduates of this country....oh God.

He could be dyslexic.

I think everybody knew what the OP meant.

Geology

This guy is a troll. I was looking at Personal Issues last night and he got banned.

KhanTheMan

BendiBus wrote: »

Over 25 years is 1490. What's the interest relief? €133?

Say €1350pm to buy versus €1150 to rent? Only €200pm to own rather than rent?

2 random houses, back of envelope calculations etc. but that's interesting. And surprises me!

Or more commonly a mortgage over 30 years and maybe pay a few grand more down. And with a couple its interest relief x 2

I still dont think houses are good value at the moment, but i was just posing the question of what effect something like this will have on people renting when more people realize its possible (as you can see though, clearly some havent realized its possible at all yet).

Interesting situtaion though isnt it. Going to become more apparent as prices fall further and interest rates fall too.

gurramok

7,800 interest in first year. They will not get full 133 relief as its not 10k. (http://www.jeacle.ie/mortgage/)

I think what matters is that the rent is too high in poorer areas for 2beds or less hence it looks a tad bit better to buy per mth using that 30yr term than in any other area.(still more expensive though!)