Buy, build or wait?

milathene

Hi all! After reading for weeks about "to buy or not to buy" I started wondering... Is there a chance that some of the types of properties will keep their prices high for next few years? I mean old types of cottage/ old bungalowes buid in 50-80 wchich I would be interested in next few years. Just saw the ad on the daft :

http://www.daft.ie/searchsale.daft?id=550641

It has been there for a good while, 2 months ago you could buy it for 125k... similar story with this one:

http://www.daft.ie/searchsale.daft?id=509361

Now... I am not buying yet, just renting and saving and waiting for prices to go down, but in meantime I have few ideas and want to ask the public first if any of those has a sense.

I am foreign and planning to stay in ROI for good. I just have to make some decisions now; buy an old cottage and rebuilt it or buy site and build the house on my own. I am lucky enough to have some qualified friends so there will be no problem with rebuilding (carpenters, heavy carpenters, elektricians, plumbers etc.) but I know nothing about building exept that no one is able to get a permission to build (is that true though??)

Finaly my question: sit and rent and save or just buy now because that types of house will not drop in price?

Aha, I will not be buing any house which was built during the boom, like the ghost estates, I want peacefull location and good size garden and easy access to n7 in co.kildare. I am also fully aware of the rebuilding costs.

I will need take a morgage on it anyway, so even if I will buy in 5 years time I need to make serious financial decisions right now.

I am sorry for my poor english and I will appriciate any comments. Thanks for reading:o

ricman

If you buy a site,its safer to buy site that has planning permission already,or outline planning permission.LOOK ON daft.ie ,www.myhome.ie ,search kildare ,see what other houses are going for average price.IVE seen homes going for 170k private estates in dublin west ,i dont know if thats a good price ,it seems a bit expensive to me, bid 110k and see what happens.

johndaman66

Just to make a point milathene. There are certain restrictions on demolishing older buildings in that certain buildings cannot be knocked and a new house rebuilt in their place. Not exactly sure what the criteria is but would assume that once the building is of a certain age you would be prevented from knocking it...perhaps somebody could clarify? Just know this because my uncles house was built in 1920's and he is not allowed demolish the structure.

musharra

In answer to your question...wait for a few months.
It is now cheaper in certain areas to buy than it cost
to build and only a matter of time before that effect
and more stern effects are felt in most other areas.

There is a 'hard frozen' stock of houses all over that
are still at inflated prices for months/years.

There are 2 distinct types of sellers as I see it, one that is under pressure to sell and is slowly dropping the asking price, then theres the 'sit on the fence' seller who thinks
'things will pick up' ...the only thing that is picking
up pace is the country financial mess.(debt, interest rates, unemployment) and I think it will remain so for 10-20 years.

When type 2 seller realises this and decides to get out
before the big bang (75%+ drops from peak)...then you'll see prices drop countrywide.

EA's know this well , but like government they're ignoring the inevitable..

TommyT

I dont think it makes financial sense to build at the minute, not when you can probably buy a finished home for less than it will cost you to build your own. House prices have dropped considerably and while the price of building materials has come down a bit, the price of labour is the main problem. Some builders still think they are worth a lot more than they really are.
We have a site, have planning, but we are in no rush to build, not unless local builders come to their senses. One of them wanted €28k for the blockwork on a 2200sq ft house. What we are doing is buying a bit more land at the minute, its probably as cheap as it has been.

dan_d

Build or wait.

But if you plan on building, be very sure you can get planning permission, or you can demolish an old building.

As for 28k for blockwork....brickies have priced themselves out of business for the last few years, and obviously have yet to come to their senses. But you can get labour a lot cheaper these days than before, just have to do a whole lot of research.

FoxT

It is impossible to time the market perfectly - so very, very few people will buy at the perfect time when the market is at bottom. Whatever you do, keep your LTV ( ratio of your mortgage to the value of the property) as low as you can.
If i was borrowing for a house right now, I would make sure that I could put up at least 25% of the cost (total cost including stamp duty) from my own funds. If i could not do that I would stay away from the market.

If you have funds saved, then do not be at all afraid to make low-ball offers on properties that you find attractive. If they have been on the market long enough then the seller may accept.

Beware of auctioneers who tell you they already have a bid of xx amount. They might have, or they might not, and you have no way of knowing. If you smell a rat, just walk away - there are plenty of houses out there.

Best of luck with it

- FoxT

Victor

milathene wrote: »

I am foreign and planning to stay in ROI for good. I just have to make some decisions now; buy an old cottage and rebuilt it or buy site and build the house on my own. I am lucky enough to have some qualified friends so there will be no problem with rebuilding (carpenters, heavy carpenters, elektricians, plumbers etc.) but I know nothing about building exept that no one is able to get a permission to build (is that true though??)

You can't rely on things like this unless you have someone to supervise these people.

johndaman66

Actually some very good advise provided there by FoxT.

antoinolachtnai

If you don't know anything about building, and don't have special requirements, it is very unlikely that you can save money by building rather than buying. You need professional help to build if you don't have the knowledge yourself. Depending on your friends to build you house is (a) not a very reliable way to get it built to a high spec and (b) a very reliable way of losing friends.

johndaman66

antoinolachtnai wrote: »

Depending on your friends to build you house is (a) not a very reliable way to get it built to a high spec and (b) a very reliable way of losing friends.

Haha, quite true I'd guess. Ive found from experience that friends and particularly family and relations generally don't make ideal business acquaintances. I'm not talking about building houses here but no doubt the same logic follows through. If you are to go down this route ensure all the legal considerations you would normally adhere to when entering into such a contract with a builder are indeed adhered to here.