Very high rent / Time to buy?

tendjose

Hi,

At the moment I'm paying 700euro for a double room (not insuite) in Dublin 4Km from the center.

Trying to solve that was thinking in buying an apartment with 2 rooms and rent the second room.

Currently my apartment has 3 rooms and the owner is living there, so probably me and the other guy are paying his mortgage.

I just keep seing the apartments prices in Dublin rising and I see many competition for buying, so I don't know if it is a good time to buy.

The other strange thing is that even house are being sold, if you rent, rents keep increasing in daft.ie.

So is this a good time to buy an apartment and rent one room, or I'm already late?

gaius c

Why don't you just rent a cheaper room?

Rathgar is approx 4km from city centre and you can get a double room for €450.
http://www.daft.ie/sharing/orwell-gardens-rathgar-dublin/818535/

If you can't afford to rent a room in Dublin, you almost certainly cannot afford to buy an apartment.

MarkAnthony

gaius c wrote: »

If you can't afford to rent a room in Dublin, you almost certainly cannot afford to buy an apartment.

Not so sure tbh, given how the average Dubliner saves you're probably right though!

Quick calculation puts loan of 110K with KBC at €477 per month based on a salary of 25K + 15K overtime/bonus - doable for most. 135K inc a 25K deposit. Not going to get you prime CC but should get you something walking distance to CC, if not a short commute.

I'm frequently shocked at the room rates in Dublin.

tendjose

gaius c wrote: »

Why don't you just rent a cheaper room?

Rathgar is approx 4km from city centre and you can get a double room for €450.
http://www.daft.ie/sharing/orwell-gardens-rathgar-dublin/818535/

If you can't afford to rent a room in Dublin, you almost certainly cannot afford to buy an apartment.

I'm male.

Looking for females only (Couples not accepted)
Available to Move In:

Immediately Available for:

Me and most people want 1 year at least.
6 months

And when you press the "Map" button you see that it is 6.3Km cycling:
https://goo.gl/maps/GZ9aj

These 3 factors make the price being low.
It looks like you don't research too much accomodation in Dublin...

The average rent for Dublin is 650euro, I read it on a study.

Another risk of moving is that I'm happy with my housemates, and I might not like the new ones and be forced to move again.

If I buy the house, I decide how stays and who leaves...

I can afford buying an apartment, the thing is that 700euro is an exageration and I like to save to apply that money on more useful things...

MarkAnthony

tendjose wrote: »

It looks like you don't research too much accomodation in Dublin...

Not read too many of GC's posts it seems :pac:

tendjose

MarkAnthony wrote: »

Not read too many of GC's posts it seems :pac:

What is GC? What do you mean?

gaius c

I picked one of the 1,309 rooms for rent in Dublin to demonstrate that there are plenty of rooms cheaper than what you are renting because that's the issue you highlighted in the title of the thread.

If you are unhappy paying such rent, then move out and investigate the 1,120 rooms to rent that are cheaper than €700 per month.

tendjose

gaius c wrote: »

I picked one of the 1,309 rooms for rent in Dublin to demonstrate that there are plenty of rooms cheaper than what you are renting because that's the issue you highlighted in the title of the thread.

If you are unhappy paying such rent, then move out and investigate the 1,120 rooms to rent that are cheaper than €700 per month.

The investigation is not so simple. Keep investigating and you'll see it's not that easy.

And if you register for alerts you get 15 guys making a queue to see the room on the same day they published the ad.

The rooms left outside the alerts, always have something wrong with it, believe me.

The point here is wether to buy and rent the rooms or not.
Point 2, if houses are selling well now, why the rents keep increasing (going for 800euro now)?

snubbleste

Just buy.

groovyg

tendjose wrote: »

Hi,

At the moment I'm paying 700euro for a double room (not insuite) in Dublin 4Km from the center.

wow thats a crazy amount of money for a double room in shared accommodation especially when you are living with the owner. jeezus even during the so called celtic tiger years when rents were high I never paid that amount for a house share.

Does that include all your bills???

tendjose

groovyg wrote: »

wow thats a crazy amount of money for a double room in shared accommodation especially when you are living with the owner. jeezus even during the so called celtic tiger years when rents were high I never paid that amount for a house share.

Does that include all your bills???

No bills included. And I'm lucky because we have gas for the shower (cheaper).

I have to pay electricity, gas, Internet and TV Licence, around 50€ per month

...well The TV licence we had to pay in advance for the whole year, and we don't have paid TV channels (we only have the antenna old ones)....

Imagine If we would have Skysports HD

dearg lady

Sounds like you're being ripped off. There definitely are cheaper rooms out there. I would first look for one of them before I jump into a house purchase

tendjose

dearg lady wrote: »

Sounds like you're being ripped off. There definitely are cheaper rooms out there. I would first look for one of them before I jump into a house purchase

If you register for daft alerts, they're going already in 800€...

dearg lady

It's like talking to a brick wall... I just searched on daft for D1,2,3,4,6,7,8,9, under €500 double room, and there's 125 available. You need to look harder if you can't find anything under €800

tendjose

dearg lady wrote: »

It's like talking to a brick wall... I just searched on daft for D1,2,3,4,6,7,8,9, under €500 double room, and there's 125 available. You need to look harder if you can't find anything under €800

So the brick wall will say that this room was advertised has 550€, a queue of people bidding, when I visited on the same day as the others the bid was already in 700€ and that was what I had to bid if I wanted a chance to be choosen...

Wanderer78

be very careful with buying. you have to look at the long game. do you plan to live in dublin for a long period? do you have any plans to leave ireland and live somewhere else? will you be happy living with others in your own place for a long period? all complicated questions and hard to answer. being a landlord can be stressful. i know a landlord that was recently beaten due to taking in a bad tenant and unfortunately the gardai could do little or nothing about it. im amazed how people recommend others to just take the leap and get themselves into large amounts of debt. this can cause lots of stress and complications in ones life. its great not to have these debts as you can walk away any time you want. taking on a mortgage is one of the biggest debts you will ever take on. dont make a rash decision. theres more to life. best of luck with your decision.

gaius c

tendjose wrote: »

So the brick wall will say that this room was advertised has 550€, a queue of people bidding, when I visited on the same day as the others the bid was already in 700€ and that was what I had to bid if I wanted a chance to be choosen...

With a defeatist attitude like that, you won't save much on your rent.

ShaShaBear

gaius c wrote: »

With a defeatist attitude like that, you won't save much on your rent.

Its hardly a defeatist attitude if he arrived there and the rent was already up to what he is paying now. Should he have bid €50 p/m more than what he is already paying and then revel in the fact that he now lives in a more expensive room?

grey_area

Although I agree the OP seems a bit defeated, he is right that the rents are shockingly high for any decent place in an area reasonably close to the city centre.

I am trawling through Daft at the moment as well, seeking a house share to start sometime soon. A double bed anywhere along the green Luas line is gonna be 650 anyways. Plus bills then.

I've considered looking for a full 2 bed apartment to rent, and sublet the second room but prices for those are even more expensive per person, perhaps because it is the start of a new lease. Actually, is it possible to negotiate rent with estate agents/landlords when starting a new lease?

tendjose

Considering the market flow at the moment is it a good business to buy an apartment in Dublin city centre and sell it in a few years?

Or maybe the apartment prices won't increase that much in the next years, because last year they already increased a lot...

I would be living there, I plan to stay here for a long time.

mrcheez

Prices probably won't go down, but regardless of what happens price-wise property ownership is a hell of a lot better than renting.

If you can afford a place, go for it.

MarkAnthony

Honestly apartment prices vary wildly over the city.

Are you taking a 1000 Sq ft Clontarf pad at 600K, a D1 top apartment at 400K or a relatively modern but not particularly attractive place in D7 or 8?

There are some gems to be had if you look carefully but really who knows what will happen with upper end apartments. If you're looking at the sub 200K area I don't think you'll do much wrong buying now, you can always rent it out.

Atlantic Dawn

Time to sell, time to buy is 5 years time.

MarkAnthony

Atlantic Dawn wrote: »

Time to sell, time to buy is 5 years time.

Take an apartment at 200K, 15% deposit - 170K mortgage.

Looking at roughly €800 per month and fairly predictable interest rates.

The same place is going to cost around €1200 - we can knock €100 a month off that for management fees you'll not need to pay. Thats €300 per month over 60 months - 18K. Inflation and a small payment off the equity of the mortgage means you'll need a 9% drop to break even.

Even stevens in my book but of course who really knows.

chris85

MarkAnthony wrote: »

Take an apartment at 200K, 15% deposit - 170K mortgage.

Looking at roughly €800 per month and fairly predictable interest rates.

The same place is going to cost around €1200 - we can knock €100 a month off that for management fees you'll not need to pay. Thats €300 per month over 60 months - 18K. Inflation and a small payment off the equity of the mortgage means you'll need a 9% drop to break even.

Even stevens in my book but of course who really knows.

I am buying at moment and even them calaculation are ultra simplistic. Buying incurs stamp duty, solicitors, life insurance, mortgage protection insurance, house insurance, property tax. As well as you have to cover stuff that breaks (such as showers, washing machines, etc) which not all is your responsibility when renting.

However I want to buy as I want some security for myself for my future and not put up with the rental market which I have been in and full of properties in poor condition and cowboy landlords at every corner. Also rental costs at moment are ridiculous for poor properties.

MarkAnthony

chris85 wrote: »

I am buying at moment and even them calaculation are ultra simplistic. Buying incurs stamp duty, solicitors, life insurance, mortgage protection insurance, house insurance, property tax. As well as you have to cover stuff that breaks (such as showers, washing machines, etc) which not all is your responsibility when renting.

Mortgage protection = life insurance (or there abouts MP decreases over the loan) it shouldn't be more than a couple of hundred a year if that but worth factoring in I grant you.

Block insurance is included in your management fee, contents insurance should be taken out even when renting.

Legal fees and stamp duty - shop around you should get some relief off of these with the right mortgage deal, let's factor 2K for these though to be fair.

Stuff breaking - meh, not as expensive as people think. At least you have decent stuff rather than the ****e thats in most rental places.

chris85 wrote: »

However I want to buy as I want some security for myself for my future and not put up with the rental market which I have been in and full of properties in poor condition and cowboy landlords at every corner. Also rental costs at moment are ridiculous for poor properties.

This is difficult to overstate tbh.

riclad

You can buy a small house for 100-130k,
house has no service charges ,no one lives on top, or beneath you.
Look at mortage cost vs 500 plus in rent ,
rents in dublin seem to always go up.
IN 10 Years time you,ll get your money back,if you wanna live somewhere else.
I think stamp duty is very small if house is under 500k.
house insurance is around 350 euro per month.
Not A bad time to buy if you can get a loan.

mrcheez

My rent was more than my mortgage is now. Not to mention I get all that money back when I sell it (plus extra if value goes up).

Additionally I can upgrade infrastructure in the house and "pimp" it up to create the ideal home without worrying about a landlord throwing me out at a moment's notice so they can sell the place with all my upgrades included.

As I said before, buying is best if you can afford it. Rent is just wasted money as you're just paying someone else's mortgage when you could use the same (or less money in my case) to pay for your own.

When I bought this place it had a D3 BER. It now has a B3 BER and is a hell of a lot toastier. Had I been renting I'd still be in a damp D3 abode with cheap appliances.

chris85

MarkAnthony wrote: »

Mortgage protection = life insurance (or there abouts MP decreases over the loan) it shouldn't be more than a couple of hundred a year if that but worth factoring in I grant you.

Block insurance is included in your management fee, contents insurance should be taken out even when renting.

Legal fees and stamp duty - shop around you should get some relief off of these with the right mortgage deal, let's factor 2K for these though to be fair.

Stuff breaking - meh, not as expensive as people think. At least you have decent stuff rather than the ****e thats in most rental places.

well the block insurance being included in management fees is fair enough if in managed estate, which I am not looking at really. Need building + contents.

Also 2k for legal fees is about right, another 1% of house price for stamp duty. They are once off fees but expensive enough.

Agree happy enough if my stuff which is decent breaks rather than crappy stuff there already and hassle to get it replaced.

cardinal tetra

Last good time to buy was October 2013.

Wait until the 20 rate comes in and demand falls to meet supply. Prices have stagnated over the last 6 months. A 15 to 20k drop will happen by December. Pent up demand is waining.



Also. Buy a house.wtf do u want to be paying 1500 quid a year on a management fee that doses nothing for you.

CollyFlower

Riclad, "You can buy a small house for 100-130k,"

Don't think you'd find a house in Dublin city centre for that price!

riclad

buy a house,
what do you get for a management fee,?
Most house s have a least on street parking,for 1 or 2 cars .
Some apartments are not very secure.
i went to buy a pc on adverts.ie , some one just let me in to the building.
i could be anyone .
I just said i,m here to see joe.
you buy a fridge ,it breaks down after 10 years ,not a big cost .
stamp duty is 1 per cent on most house s .

MarkAnthony

chris85 wrote: »

well the block insurance being included in management fees is fair enough if in managed estate, which I am not looking at really. Need building + contents.

Also 2k for legal fees is about right, another 1% of house price for stamp duty. They are once off fees but expensive enough.

Agree happy enough if my stuff which is decent breaks rather than crappy stuff there already and hassle to get it replaced.

Ulterbank €1500 towards legal, BOI 80ish% of your stamp duty paid.

Block = buildings insurance, you can't get individual buildings insurance - here - on an apartment.

cardinal tetra wrote: »

Last good time to buy was October 2013.

Wait until the 20 rate comes in and demand falls to meet supply. Prices have stagnated over the last 6 months. A 15 to 20k drop will happen by December. Pent up demand is waining.

Also. Buy a house.wtf do u want to be paying 1500 quid a year on a management fee that doses nothing for you.

See the predictions and figures in the Property Market thread. You might see a 20K drop on a 600K apartment. There is no way you'll see 10% drops on apartments near Dublin CC by December this year.

Management fee covers your bins, insurance, repairs to the fabric of the building, common areas etc. There is no reason a management fee needs to be much higher than what someone would spend on a house. Owning an apartment is a good first step in regards property ownership, there should be very little hassle in a well managed complex. Also renting it out is much easier, less hassle again. Buying a house has it's advantages and disadvantages.

The_Conductor

Moderator note:

tendjose - I have merged your two threads- 'rent too high' and 'time to buy?'
It is frowned upon to start multiple threads with basically the same subject matter. Please refrain from doing this in future.

johnp001

Atlantic Dawn wrote: »

Time to sell, time to buy is 5 years time.

After something like 45% inflation in Dublin apartments prices in the last 2 years according to CSO figures now is definitely the time to sell.
Time to buy could be sooner than 5 years though. If the increase in stock on the market keeps accelerating prices will drop sooner than later. Also, in 2018 the investment properties bought at the start of the CGT exemption period become eligible for sale. This will particularly affect apartment type property.
The market knows this is glut of motivated sellers is coming and it should start to affect selling prices well before 2018 as investors who are not eligible for the CGT exemption scheme get out before they have to compete for buyers with the CGT exempt sales.

riclad

A bloke was on joe duffy 2 years ago,,said he pays 2500 a year ,
service charges,
i think cos theres lifts and a large underground car park,
he does not have a car .

You will not spend 2500 in repairs on a house every year ,
buy a house for 150k,
its a better deal in the long term .
Why does a ftb need to buy a 600k apartment,
is it next door to bono,s gaff.

jmayo

mrcheez wrote: »

My rent was more than my mortgage is now. Not to mention I get all that money back when I sell it (plus extra if value goes up).

Ever think that it might go down ?

cardinal tetra wrote: »

...
Also. Buy a house.wtf do u want to be paying 1500 quid a year on a management fee that doses nothing for you.

I tend to agree.
A small terraced house is better than apartment when you factor in continous management fees.

The_Conductor

riclad wrote: »

A bloke was on joe duffy 2 years ago,,said he pays 2500 a year ,
service charges,
i think cos theres lifts and a large underground car park,
he does not have a car .

You will not spend 2500 in repairs on a house every year ,
buy a house for 150k,
its a better deal in the long term .
Why does a ftb need to buy a 600k apartment,
is it next door to bono,s gaff.

The service charge normally covers bins, building insurance, 3rd party public liability insurance etc.Totally aside from a lift or other goodies- basics including bins- are pricey- add up what you're paying and you'll see what I mean.

lafatec

presently, we are paying, 700euro for a three bedroom house, my landlord has just sent a notice of three months saying that we should vacate the house. He is planning to come down to see us. For over a month now we have been looking for accommodation. A house is not easy to get at the right price.

handlemaster

lafatec wrote: »

presently, we are paying, 700euro for a three bedroom house, my landlord has just sent a notice of three months saying that we should vacate the house. He is planning to come down to see us. For over a month now we have been looking for accommodation. A house is not easy to get at the right price.

Cheap house well outside dublin i guess

jmayo

The_Conductor wrote: »

The service charge normally covers bins, building insurance, 3rd party public liability insurance etc.Totally aside from a lift or other goodies- basics including bins- are pricey- add up what you're paying and you'll see what I mean.

Jeeze you must be dumping a lot of stuff to be paying anything near a grand on bins ?

mrcheez

jmayo wrote: »

Ever think that it might go down ?

It may go down, but hold on to it long enough and the price will eventually rise up to the original due to inflation or other factors. Could be 2 years, could be 15 years

My point is that all the money spent on rent will never be reimbursed no matter how long you wait.

What I was saying is that you can wait 5 years for property prices to drop (or not) and be living under a landlord and have no freedom to do up your living space, or - assuming you can afford it - buy a place and spend the next 5 years enjoying your life living in a space you've customised to your requirements.

cardinal tetra

MarkAnthony wrote: »

Ulterbank €1500 towards legal, BOI 80ish% of your stamp duty paid.

Block = buildings insurance, you can't get individual buildings insurance - here - on an apartment.



See the predictions and figures in the Property Market thread. You might see a 20K drop on a 600K apartment. There is no way you'll see 10% drops on apartments near Dublin CC by December this year.

Management fee covers your bins, insurance, repairs to the fabric of the building, common areas etc. There is no reason a management fee needs to be much higher than what someone would spend on a house. Owning an apartment is a good first step in regards property ownership, there should be very little hassle in a well managed complex. Also renting it out is much easier, less hassle again. Buying a house has it's advantages and disadvantages.

Bins 200
Insurance 350
So you essentially have 1000 a year difference to do up the fabric of your home as you call it. Unlessb you take delight in the crap job Mary does in the common area as she slithers past, dragging a filthy mop behind her. There has never been a management fee worth paying. Ever.

MarkAnthony

cardinal tetra wrote: »

Bins 200
Insurance 350
So you essentially have 1000 a year difference to do up the fabric of your home as you call it. Unlessb you take delight in the crap job Mary does in the common area as she slithers past, dragging a filthy mop behind her. There has never been a management fee worth paying. Ever.

My management fee is well under 1100 including lift fee. I think your estimates or bins and insurance are pretty much bang on the money. So for €550 a year or under €50 a month I get:

Common Areas cleaned - to a high standard
Cark park and gardens kept
Lift maintained
Common areas painted on a quarterly basis
All the residents doors/timer work painted (external)
Security Gate maintained
Security guard
Caretaker

I'm never going to have to worry about my roof, pipes (external to the apartment) gutters or Sky Dish / Telecoms lines.

Dunno about you but that seems pretty good value to me. You didn't spend €500 maintaining your house last year?

mortimer33

MarkAnthony wrote: »

My management fee is well under 1100 including lift fee. I think your estimates or bins and insurance are pretty much bang on the money. So for €550 a year or under €50 a month I get:

Common Areas cleaned - to a high standard
Cark park and gardens kept
Lift maintained
Common areas painted on a quarterly basis
All the residents doors/timer work painted (external)
Security Gate maintained
Security guard
Caretaker

I'm never going to have to worry about my roof, pipes (external to the apartment) gutters or Sky Dish / Telecoms lines.

Dunno about you but that seems pretty good value to me. You didn't spend €500 maintaining your house last year?

Looks like you're getting a decent deal there..

I had first hand experience with a management company.. you also get
-conflict
-some residents refusing to pay
-legal disputes with members/contractors
-block insurance increases if a neighbors suffer a fire
-less control
-clamping
-if mgt company goes bankrupt it could affect your ability to be a director
-more difficult to sell if mgt company is poor
-need to worry about sufficient sinking fund
-restrictions on sky dishes so you're forced to subscribe to upc
- bin rooms that are used as dumping rooms

Its a different set of worries.. I much prefer looking after my own house.

MarkAnthony

mortimer33 wrote: »

Looks like you're getting a decent deal there..

I had first hand experience with a management company.. you also get
-conflict

We also have conflict, usually it's sorted out amicably. How many threads are there here about people that can't sort out conflict with their neighbours in a housing estate.

mortimer33 wrote: »

-some residents refusing to pay

Usually this is because of a poorly run OMC - the residents have only themselves to blame there.

mortimer33 wrote: »

-legal disputes with members/contractors

Can happen just as easily in a house, legal protection is normally imdemnifed by insurance, in other cases.

mortimer33 wrote: »

-block insurance increases if a neighbors suffer a fire

We've had claims on our insurance, doesn't increase it by very much at all. Especially as it's passed on to a group of people. Have one burglary or fire and a householder will be paying more than someone with a share of block insurance.

mortimer33 wrote: »

-less control

Of what? You'll have zero control of the road running past your gaffe, we've total control.

mortimer33 wrote: »

-clamping

Seen about 5 cars clamped in 10 years. All repeat offenders packed in someone else's spot. What happens if someone parks in your drive - Are you going to spend €500 on a good clamp and have 4 guys standing there when you take it off?

mortimer33 wrote: »

-if mgt company goes bankrupt it could affect your ability to be a director

Pretty remote.

mortimer33 wrote: »

-more difficult to sell if mgt company is poor

Just as difficult to sell if you live next to asshats who are own their home freehold, at least with leasehold a good OMC can take action. Again crap OMC are only ever the fault of the residents.

mortimer33 wrote: »

-need to worry about sufficient sinking fund

Just as big a worry of not more so in a house.

mortimer33 wrote: »

-restrictions on sky dishes so you're forced to subscribe to upc

Completely in the control of the OMC - we've communal dishes.

mortimer33 wrote: »

- bin rooms that are used as dumping rooms

Fly tipping can easily happen into your garden, again completely within the control of the residents and OMC.

mortimer33 wrote: »

Its a different set of worries.. I much prefer looking after my own house.

It can be, but the difference in cost might buy you a round of drinks a month with a good OMC. The costs are broadly the same in owning a house, you do give up some control in return for a collective agreement.

riclad

Money from service charges ,goes to pay for insurance, maintenance,refuse collection,
an long term emergency fund.
eg say theres a flood ,or the lifts break down,
major repairs need to be made. new boiler needs to be installed,
things like doors , need fixing in the common area,s
.
There,s was a report on rte ,about some people in a country apartment block,
30 per cent of residents refused to pay service charges .
AT some point in a large building ,some large repair will need to be made.
or they could be a frozen pipe, leak which causes damage .
Thinks like intercoms, security doors made need fixing frequently .


BY the way look on daft.ie ,under 150k,
there,s of old 1/2 bed houses under 150 k.
You dont have to just buy an apartment.

IF you buy an apartment in a large building with lifts , underground park ,the services charges will be higher , than say a block with only 20 units
in the building.

Only the larger apartment developments would have security gaurds .