To buy now or not to buy now??

Zipppy

Scenario....

Divorced,,
Lump sum of enough to buy a standard 3 bed semi in Dublin with no mortgage..but will be almost broke afterwards
Living with gf in her house.
Permanent job but salary hugely reduced so no savings to come for the fore seeable future..
Current salary will not finance ANY sort of loan/mortgage..
gf also permanent and salary a lot higher then mine..

Want to buy a house now as we both want out of current area, gf will sell (if she can..), pay off mortgage and ex and move in with me, eventually buying half share when her divorce comes through in 1-2 years..

Have seen a couple of houses that I like/can buy for cash..but as have said will be skint afterwards and my salary is just ok to live on..JUST !!

Friends say 'Dont be mad..wait a year..save lots of cash for other things..'
Also they think that we should wait till her divorce is through and buy a bigger / better place together..

Opinions?

okedoke

Wait - you're in the enviable (financial) position that when the market actually hits bottom in a few years you'll be one of the few people in the county able to get the real bargains because you won't be hoping an insolvent bank lends you money.

Deposit the lump sum - rent in an area you like - while house prices are falling you are effectively becoming richer. If you buy now the inevitable further falls in house prices make you poorer every day.

okedoke

Theboinkmaster

Do some more research here and thepropertypin.com.

WAIT!

By doing so you are certain to save thousands and could save a few hundred thousand euro in cash.

SkepticOne

People are still in shock from the fairly dramatic bursting of the bubble so they are going to be cautious getting back in. No one knows when the market is going to hit bottom but there is likely to be a longish period of levelling off followed by tentative rises.

All this is in my humble opinion but I would wait to see definite and sustained signs of a pick up (i.e. not estate agent or developer spin) before entering the market. I think you want to see three consecutive quarters of rises before being sure it is on the way back up.

A classic investor mistake is buying on the way down after a bubble has burst thinking there can't be further falls.

Another thing you should think about is the shakiness of the Irish economy. In such times mobility is a valuable asset and you lose a bit of this if your money is tied up in a house. If you do buy, make sure you keep funds to one side in case you need to take a job abroad for example.

Colonel Sanders

What's your rush?

If you're sitting on that kind of cash surely the interest alone is adding up to either a bigger lump sum or being used to fund a better life style after your pay cut

Even if we have hit the bottom (and I believe there is no way in hell we have) the horizon isn't exactly bright for the Irish Housing market (reduced wages, increased taxes, huge over supply, possible property taxes etc) sit it out for the next while