Buying a house 2012

efb

My room after scrubbing and cleaning!

Bigcheeze

FixYa wrote: »

Hi guys,
I was very keen to buy a house and seller accepted my offer.
I suggested to do a structural survey to have an idea of what needs to be done in the house prior to giving deposit.
I knew that heating and windows need to be changed, however when I received survey report it also outlined that more things need to be repaired/modernized. eg. ventilation in the house, roof fascias and soffits need to be replaced and complete insulation to comply with modern standards.
This exceeds my budget that i expected to spend on renovation of this house.
I decided to pull out - but my concern is if I will get my deposit back and if there are any fees / charges if i pull out?
I did not formally signed any contracts yet.
Could you please advise?
Thanks

If that's your reason for pulling out you should stop looking at houses built before the 90's because I can guarantee you that virtually all of them will have surveyor comments about insulation, ventilation, fascia etc. I'd be worried if a surveyor didn't comment on insulation.

Remember that most of these things don't have to be done but the surveyor is pointing them out to you in order to be thorough.

L1011

Is the BOI AIP one from the website, or one on paper after they've actually checked earnings/outgoings/ICB? It doesn't seem unrealistic to begin with, but if its on paper, go for it and ignore AIBs figures.

Additionally, if you're actually going for 110k (so a mortgage of 100kish), you are well within the multiple they gave me so unless there's some secret horrors hiding in your financial history you should be OK.

I had a (very small) bidding 'war' but it was obvious that it was only one other person who didn't really have the money (final attempt was a 1k increment); and there was quite a lot of viewings there too.

The EA should tell you if there is an offer and how much - if there isn't an offer, go in well below the asking price. Ignore the asking prices on the other nearby apartments - what have any actually sold for (on the property price register)

Fearsneachta in Poland

niniboots wrote: »

Following the thread last few days and reading back through the advise which has been great! Would really appreciate if someone could offer some urgent advise please? FTB's both employed no kids, one salary 37k second 27k first salary permanent, second civil service contract (although renewable its new contract) we have 13k in savings 700 per month last 10mths. We have been given approval in prinicple from AIB for 80k and approval in principle from BOI for 145k seemed like a big difference (we have been told cannot take the contract earnings into account). We had not planned to buy and were anticipating saving another year or so to increase deposit possibly move to permanent contract etc and be able to factor this into a loan. However a property which is very very unique has come onto the market in the price range we have been given the approval in principle for and we have both fallen in love with it (I know big mistake).

First question would it be reasonable to offer on this property with the approval in principle from BOI considering that AIB amount is too low? (we have all paperwork in BOI waiting on full approval)

The EA has told us they have received full asking price offer on the property already and he will be ringing other interested parties (apparently 6 other couples registered their interest)! The property is worth more I believe although this is based on what is available within the area within this price range rather than any experienced viewpoint! Its a very unique one off property and an original so no other property in area or surrounding area.

I am reluctant to offer as we only have approval in principle and based on what I have been reading this is worthless. However if we were passed I would be so dissapointed we had not tried. So second question are houses/apartments really going for above asking price and are there secret bidding wars going on we have not heard about? If we were to offer what would be reasonable % to go above, the apartment is asking price 110k, there is nothing really to compare in the area but other much smaller less unique apartments are same price. The open viewing had scores of people and all seemed eager to put their names in the pot!

Anyway probably looking for small miracle if we were to actually get it as it appears to be moving too quickly with the fact we are not fully loan approved.

However If anyone can offer some sound advise I would appreciate it.
thanks in advance

Yes from my experience you can definitely offer with mortgage in principle in place. First set your own value on what the house is worth to you. Be ruthless, get rid of them feelings (hard thing to do). Sit down with a pen and calculator.

Next step is to be proactive tomorrow and ring the estate agent. Ask how many people have bid on the house so far and what their bids where. Discount the other viewers. Inform him that you are seriously interested. Tell him that you will be making an offer in due course.

I would then bid 1k extra and take it from there after you have time to reflect. And of course be aware of phantom bidders.

Villa05

Finance Minister Michael Noonan has firmly rejected calls from within his own Government to extend the mortgage interest relief deadline from the end of the year

http://www.independent.ie/national-news/noonan-rejects-calls-to-extend-mortgage-date-3281817.html

As a potential FTB, This is the best news I have heard all year. The buying in late 2013/2014 thread could make very interesting reading

Villa05

efb wrote: »

My room after scrubbing and cleaning!

I wonder do builders put the furniture in first and then build the walls around the furniture

Fearsneachta in Poland

Villa05 wrote: »

http://www.independent.ie/national-news/noonan-rejects-calls-to-extend-mortgage-date-3281817.html

As a potential FTB, This is the best news I have heard all year. The buying in late 2013/2014 thread could make very interesting reading

Race is on for me, hope to sign contracts shortly. Nobody said it was going to be easy!!!!

leahyl

Villa05 wrote: »

http://www.independent.ie/national-news/noonan-rejects-calls-to-extend-mortgage-date-3281817.html

As a potential FTB, This is the best news I have heard all year. The buying in late 2013/2014 thread could make very interesting reading

Why is this good news???!!! It's the worst news ever

Jumpaddict

How?

I'm a FTB too

leahyl

I made an offer on that house 5k less than the asking price on Thursday 25th October, agent came back to me on Tuesday 30th and said family (children of deceased mother who lived there) weren't willing to accept my offer because they believe it to be worth more - why put the bloody house at such a low price then FFS! Anyway, agent said I was the only offer at the moment (basically trying to get me to bid more) so I said let me know if there are many more offers and I'll see then but that I am very interested in the house - I haven't heard anything from him since and find it hard to believe that there haven't been anymore offers (like I said house is great value) - should I ring him again tomorrow and see what the story is?? At the same time dont want to appear too desperate even though I am!! I want that house :-P! and I want it before the end of the year if at all possible.

Thanks

leahyl

Jumpaddict wrote: »

How?

I'm a FTB too

Are you talking to me? Eh it's bad news because you won't get mortgage interest relief if your mortgage is drawn down after the 31st December....is that not bad news to you?

Fearsneachta in Poland

leahyl wrote: »

I made an offer on that house 5k less than the asking price on Thursday 25th October, agent came back to me on Tuesday 30th and said family (children of deceased mother who lived there) weren't willing to accept my offer because they believe it to be worth more - why put the bloody house at such a low price then FFS! Anyway, agent said I was the only offer at the moment (basically trying to get me to bid more) so I said let me know if there are many more offers and I'll see then but that I am very interested in the house - I haven't heard anything from him since and find it hard to believe that there haven't been anymore offers (like I said house is great value) - should I ring him again tomorrow and see what the story is?? At the same time dont want to appear too desperate even though I am!! I want that house :-P! and I want it before the end of the year if at all possible.

Thanks

Im no expert, just going through the process myself. Due to deadline id say its time to put your cards on the table. Tell them that you are mortgage approved, ready to go and that they will lose you as a buyer if this is not resolved in the next few days.

Inform the estate agent of the above and ask him to find out what they can accept. Then play the game again (bidding). In the meantime look for mortgage approval on the amount that they will accept. You have nothing to lose at this stage, while they should be feeling the pressure also.

leahyl

Fearsneachta in Poland wrote: »

Im no expert, just going through the process myself. Due to deadline id say its time to put your cards on the table. Tell them that you are mortgage approved, ready to go and that they will lose you as a buyer if this is not resolved in the next few days.

Inform the estate agent of the above and ask him to find out what they can accept. Then play the game again (bidding). In the meantime look for mortgage approval on the amount that they will accept. You have nothing to lose at this stage, while they should be feeling the pressure also.

Yes I was thinking the same thing really but at the same time I don't want to be bidding against myself you know? I mean I came in 5k below asking price and according to my friends husband they should be biting my hand off! The highest I could go would be 5k over asking price but obviously I dont want to pay that if at all possible. I was thinking of bidding maybe in between what I originally offered and the asking price....oh god it's headwrecking stuff!

Fearsneachta in Poland

leahyl wrote: »

Yes I was thinking the same thing really but at the same time I don't want to be bidding against myself you know? I mean I came in 5k below asking price and according to my friends husband they should be biting my hand off! The highest I could go would be 5k over asking price but obviously I dont want to pay that if at all possible. I was thinking of bidding maybe in between what I originally offered and the asking price....oh god it's headwrecking stuff!

Completely agree with the headwrecking aspect!! Flush them out first and find what they will accept. Surely it will be the asking price that they will accept. Then meet in the middle (2.5k below asking price). This will speed things up as well.

leahyl

Fearsneachta in Poland wrote: »

Completely agree with the headwrecking aspect!! Flush them out first and find what they will accept. Surely it will be the asking price that they will accept. Then meet in the middle (2.5k below asking price). This will speed things up as well.

Cheers for the advice! Think I might go with that alright! Best of luck yourself with the house hunting/purchasing and all the madness that goes with it!:D

Villa05

leahyl wrote: »

Cheers for the advice! Think I might go with that alright! Best of luck yourself with the house hunting/purchasing and all the madness that goes with it!:D

Hi leahyl, Ring the agent, Tell them about the MIR ending in December, Give them your final offer and that the offer expires in a week. Make it quiet clear that you have a number of other options and you want to close to qualify for MIR. Make the agent work for you not the seller!

Be careful, every estate agent in the country could be following this thread and maybe contributing. Remember there job is to talk up the market

Personally, I would be waiting till this time next year/2014 to purchase

leahyl

Villa05 wrote: »

Hi leahyl, Ring the agent, Tell them about the MIR ending in December, Give them your final offer and that the offer expires in a week. Make it quiet clear that you have a number of other options and you want to close to qualify for MIR. Make the agent work for you not the seller!

Be careful, every estate agent in the country could be following this thread and maybe contributing. Remember there job is to talk up the market

Personally, I would be waiting till this time next year/2014 to purchase

Thanks Villa05 - but what is your reason for waiting? Isn't it better to be able to avail of MIR if at all possible?

Mind you I'm only looking to buy the house because I actually want it - not just because the MIR is ending - if I hadn't found a house by now wouldn't be picking just any property just to get MIR but this house just happened to have come along (unfortunately probably a bit too late) so that's why I'm trying to get it done before the end of the year.

uberalles

Interesting thread

Fearsneachta in Poland

Villa05 wrote: »

http://www.independent.ie/national-news/noonan-rejects-calls-to-extend-mortgage-date-3281817.html

As a potential FTB, This is the best news I have heard all year. The buying in late 2013/2014 thread could make very interesting reading

Why is this good news????

Villa05

Apologies for the long post. The information is critical for anyone contemplating buying a house

Why the end of MIR is Good News for First Time Buyers?

• Subsidies to buy houses are swallowed up by higher prices, in effect it becomes a grant to the seller

• Announcing a timeline for the end of this subsidy, resulted in a considerable amount of mortgage qualifying buyers to come in to the market at the same time. This results in competition for houses and bidding wars. This further drives up the price.

• People currently are in bidding wars driving up the price in an attempt to get a deal done before the relief ends. In reality what they are doing is paying 10/15k extra to qualify for a subsidy that is only worth 1/2 that. Given that they are borrowing the 10/15k, they will be paying interest on it bringing the total cost to between 20 and 30k. Would you pay 30k for something worth 10/12k?

• Demand in 2013/2014 should fall significantly as people who may have planned to buy at this point, have instead purchased in 2012 enticed by the current MIR subsidy.

• When your MIR finishes, will you be able to make the increased repayments. Interest rates are currentlyr at record lows and could be alot higher when MIR finishes. There is also upward pressure on taxes and downward pressure on wages. Your net income could be alot less in 5 years time than it is now.

• When the MIR impact finishes, the market returns to normal as there is no extra incentive to buy. This will mean that prices will fall to a point where the average person can afford an average house in an average area for roughly 3.5 times the average salary = 35000 * 3.5 = €105,000.

Other Factors

• Remember prices may have fallen dramatically, but we are still expensive by international standards. Germany for example

• Supply will increase in 2013/2014 as there is considerable pressure on Banks to resolve the mortgage arrears crisis. This will start with Buy to Lets being repossessed and sold. Later, as the bankruptcy laws change in favour of the borrower. Residential mortgage holders will realise that it would be better for them if the bank repossessed and they could be free from a crippling debt within a short space of time

• Currently the total number of properties in arrears is greater than the total amount of units currently on the market. There is a potential tsunami of repossessions being held back. Trust me, they won’t be able to keep them all of the market.

SNNUS

Interesting thread guys..

Anyway my position Is I have put a deposit on a duplex around 3 weeks ago, everything now is sorted with the bank, Valuation done and the solicitor has the details from the bank and should have contracts this week.

How long do you think it would take at this stage to finally get the keys?, I am a FTB and the property will be vacant in a few weeks as the tenant has been given notice to vacate.

Fearsneachta in Poland

Villa05 wrote: »

Apologies for the long post. The information is critical for anyone contemplating buying a house

Why the end of MIR is Good News for First Time Buyers?

• Subsidies to buy houses are swallowed up by higher prices, in effect it becomes a grant to the seller

• Announcing a timeline for the end of this subsidy, resulted in a considerable amount of mortgage qualifying buyers to come in to the market at the same time. This results in competition for houses and bidding wars. This further drives up the price.

• People currently are in bidding wars driving up the price in an attempt to get a deal done before the relief ends. In reality what they are doing is paying 10/15k extra to qualify for a subsidy that is only worth 1/2 that. Given that they are borrowing the 10/15k, they will be paying interest on it bringing the total cost to between 20 and 30k. Would you pay 30k for something worth 10/12k?

• Demand in 2013/2014 should fall significantly as people who may have planned to buy at this point, have instead purchased in 2012 enticed by the current MIR subsidy.

• When your MIR finishes, will you be able to make the increased repayments. Interest rates are currentlyr at record lows and could be alot higher when MIR finishes. There is also upward pressure on taxes and downward pressure on wages. Your net income could be alot less in 5 years time than it is now.

• When the MIR impact finishes, the market returns to normal as there is no extra incentive to buy. This will mean that prices will fall to a point where the average person can afford an average house in an average area for roughly 3.5 times the average salary = 35000 * 3.5 = €105,000.

Other Factors

• Remember prices may have fallen dramatically, but we are still expensive by international standards. Germany for example

• Supply will increase in 2013/2014 as there is considerable pressure on Banks to resolve the mortgage arrears crisis. This will start with Buy to Lets being repossessed and sold. Later, as the bankruptcy laws change in favour of the borrower. Residential mortgage holders will realise that it would be better for them if the bank repossessed and they could be free from a crippling debt within a short space of time

• Currently the total number of properties in arrears is greater than the total amount of units currently on the market. There is a potential tsunami of repossessions being held back. Trust me, they won’t be able to keep them all of the market.

Read through the above. Too many ifs and buts for me. I prefer dealing in facts. The MIR was due to end last year as well. After reviewing the property price register there was no great increase in houses being bought in the race for MIR last year. (It was only announced in last years budget that it was being extended).

Your effort at armchair economics does not factor in that banks cannot/will not lend at the moment. When this changes their will be huge demand for certain types of properties.

Villa05

Fearsneachta in Poland wrote: »

Read through the above. Too many ifs and buts for me.

Only 1 "if" and 1 "but in my post

Fearsneachta in Poland wrote: »

Read through the above. Too many ifs and buts for me. I prefer dealing in facts. The MIR was due to end last year as well.

I'm afraid your fact is wrong, there was no plan to end MIR last year. There was a timescale for its eventual withdrawal 31/12/2017

Fearsneachta in Poland wrote: »

Your effort at armchair economics does not factor in that banks cannot/will not lend at the moment.

Again your fact is false, If banks were not lending, you could not get Mortgage interest relief. They are reducing their lending because they were and still are over exposed to 1 asset. ie property

Fearsneachta in Poland wrote: »

When this changes their will be huge demand for certain types of properties.

Where will this demand come from. Our youth are forced to emigrate, Work on job-bridge, or if they are lucky accept reduced salaries for the same work as their older colleagues.

Feel free to tell me the ifs, and buts in my post. I'm very interested. To me their all facts. Turbulent times ahead, Fasten your seatbelt

Fearsneachta in Poland

I lived through MIR going this time last year when i was making a move on a house!!!! (then the government added 12 more months in the budget) Anyway this is far too good a thread to spam up with armchair economics. There are loads of other threads to offload on.

Jumpaddict

leahyl wrote: »

Are you talking to me? Eh it's bad news because you won't get mortgage interest relief if your mortgage is drawn down after the 31st December....is that not bad news to you?

Depends, if im looking to buy before the end of year, prices will reflect the demand thats there at the moment due to people trying to access the mortgage interest relief. As far as im concerned, once interest relief is finished, prices should come back down to a 'normal' level, and my gamble is that whatever cost I would save from the interest relief over the next 4 years would be saved by waiting and purchasing a cheaper property.

Thats my gamble tho, each to their own....;)

Edit: Just read Villa's post..basically 'what he said'

sparrowcar

House going great, feels great pulling into my own driveway

Just wondering if we have to pay the household charge or are we exempt until 2013?

dove2011

The EA and my solictor asked the vendor to pay the household charge prior to any sale going through- so maybe that is already sorted for you.

Villa05

Fearsneachta in Poland wrote: »

I lived through MIR going this time last year when i was making a move on a house!!!! (then the government added 12 more months in the budget) Anyway this is far too good a thread to spam up with armchair economics. There are loads of other threads to offload on.

I was asked by other posters for my opinion, out of courtesy, I gave it. There is no obligation to believe it or act on it. They are facts, all the data is available with a little research. Draw your own conclusions from it and you certainly don't need to be an economist to interpret the data.

On MIR changes last year

Earlier this week, Finance Minister Michael Noonan announced plans to boost mortgage interest relief for both existing home owners and first-time buyers.
The changes will mean that:
Home owners who entered the property market between 2004 and 2008, at the height of the property bubble, will see interest relief on their mortgage payments rise to 30 per cent from the existing rate of between 20 and 22.5 per cent
Buyers entering the market for the first time in 2012 will receive 25 per cent interest relief on their payments
Non-first time buyers can secure interest relief of 15 per cent when purchasing a property next year
However, Noonan has warned that all mortgage interest relief will start to be phased out from the end of 2012 – and abolished entirely by 2018.

MIR was actually increased, with a schedule for withdrawal introduced
http://www.thejournal.ie/budget-2012-explainer-changes-to-mortgage-interest-relief-299827-Dec2011/

Villa05

How subsidies effect price?

Other tax changes also backfired and were reversed. For instance in 1998 when the boom was in its initial stages and the rate of price increase was 30pc a year, the Government came under pressure to cool the market.

Investors were blamed for pricing first-time buyers out of the market and so Government decided to move against speculators by abolishing mortgage tax relief on their rental income.

Soon afterwards, the rate of price increase slowed from 29pc to around 3pc a year between 1999 and March 2002, according to research by David Duffy of the ESRI on the Permanent TSB house price index.

Capitalising on this the property industry lobbied the Government and Minister Charlie McCreevy's 2002 Budget restored the tax relief for investors and the rate of house price increase again accelerated from 10pc to around 15pc in 2003.

http://www.independent.ie/lifestyle/property-plus/a-pocket-history-of-property-policy-3280425.html

cassiedoll

just a quick update.

I was due to close on the 2nd of November but i couldn't. I paid my life insurance on the 29th of October and that was fine or so i believed. I have never had to take out life insurance as this is my first house. BOI did not process my life insurance as i underpaid by €3 (which is the 1% government levy which i myself should have added on to the figure i had been given by BOI life for my insurance) Anyways sorted that all out on the 1st of November and told them the new closing is the 9th of Nov. The local branch rang me today to say that head office is in backlog of 3 to 4 days and they don't think my cheque will issue by friday.

i rang the solicitors on the other side to tell them the news and i was told i was at the start of a very large chain and five families are waiting on me to get my cheque. They arent impressed and i'm starting to lose my patience with the bank. I have given them everything they have asked for.....even my littlewoods account and after all the running around and getting everything for the bank in quick time, i'm now told they are in backlog!!!!! i need a drink