4/10 under 35 yrs old renters could buy now

handlemaster

http://m.rte.ie/lifestyle/living/2016/0222/769872-5-steps-to-financial-happiness-for-under-35s/

With this in mind what is holding people back from buying that can buy ? There is a shortage of housing but there is property for sale. Are you in this position ? What are you waiting for ?

Speedwell

I'm not an Irish citizen (my husband is). I'm an American citizen in my second year of residency. We don't plan to buy a house in Ireland until I have Irish citizenship. We are middle-aged people and so we don't qualify for the incentives granted to younger first-time buyers, even though we are first-time buyers. I prefer not to incur consumer debt and therefore I haven't used credit cards since I was in my early 20s. This makes me unqualified for most credit cards, let alone mortgages. I have more than enough in savings to buy or put the majority down on a modest home in a location that would suit us, but it is in a retirement savings account in a US bank and would trigger high taxes and penalty fees were I to withdraw it before retirement age. My husband is out of work and in school at the moment. I work from home; we will probably end up wherever he winds up getting a job once he is done with his studies. I could theoretically buy, but no matter how much I made, it would not make sense for us right now.

theteal

Because they don't have short memories? Mortgages are scary to a certain generation people. The world economy isn't exactly super healthy. Maybe people want to have proper savings in place and not just the bare minimum deposit so the wait continues? Why should they have to buy at all?

We're currently looking to buy on the edge of London/Essex and the thought of that much debt is freaking me out a bit. On top of that our broker is telling us we should apply for more as we can well afford it apparently. I don't think he'll bring that up again after the death stare I gave him.

Eugene Norman

The whole article is boom time panic driven rubbish.

Incidentally why do they stress test mortgages with an additional 2% interest when interest rates are probably going to remain static for the next 10 years

Yeh let's never stress test things ever again. and does anybody really think that interest rates won't rise of economies start to grow. The bank's want to increase rates.

He seems to be pushing a buy a house at all costs (rather than an appartment) but there's no evidence apartments don't sell on. All of these articles are agenda driven.

matrim

Speedwell wrote: »

I'm not an Irish citizen (my husband is). I'm an American citizen in my second year of residency. We don't plan to buy a house in Ireland until I have Irish citizenship. We are middle-aged people and so we don't qualify for the incentives granted to younger first-time buyers, even though we are first-time buyers. I prefer not to incur consumer debt and therefore I haven't used credit cards since I was in my early 20s. This makes me unqualified for most credit cards, let alone mortgages. I have more than enough in savings to buy or put the majority down on a modest home in a location that would suit us, but it is in a retirement savings account in a US bank and would trigger high taxes and penalty fees were I to withdraw it before retirement age. My husband is out of work and in school at the moment. I work from home; we will probably end up wherever he winds up getting a job once he is done with his studies. I could theoretically buy, but no matter how much I made, it would not make sense for us right now.

What first time buyer incentives are age related? And why would not having a credit card stop you from getting a mortgage if you can prove repayment with savings.

I Am The Law

Houses are too expensive, property owners are trying to pass on boom time mistakes to the next generation of buyers. People who are prudent at this point are to be congratulated.

Eugene Norman

matrim wrote: »

What first time buyer incentives are age related? And why would not having a credit card stop you from getting a mortgage if you can prove repayment with savings.

Well your credit rating does depend on paying back loans including credit cards.

amdublin

Eugene Norman wrote: »

Well your credit rating does depend on paying back loans including credit cards.

Yes but not having a credit card is not seen as a negative for mortgage application. In ireland.
Obviously a negative if you have one and don't pay it back! !!!

Is the op applying American lending criteria to her think?

zzxx

I want to buy but stupidly bought a house with someone 15 years ago. Relationship didn't work out, he kept the house. I left with 5k. Now I'm not a first time buyer so don't get any incentives AND have to come up with 20% deposit on my own while renting. There should be incentives for people who don't have property not just first time buyers. That's why I can't buy right now but saving hard

Ursus Horribilis

What incentives are there now anyway?

whiskeyman

It's says 'afford a mortgage', but never says for how much or where.

Rubbish article

m'lady

I Am The Law wrote: »

Houses are too expensive, property owners are trying to pass on boom time mistakes to the next generation of buyers. People who are prudent at this point are to be congratulated.

Completely agree with you there, if I heard from an estate agent that 'they paid x amount 7 years ago' once I heard it about 5 times, and my reply always was 'well it's a good thing it's not 7 years ago isn't it!?'

Captain Chaos

I can afford a mortgage no problem, my rent is higher than the calculated monthly repayments yet the banks tell me I can't afford it. I have long term proof that says otherwise.

It's the banks holding me back.

Squall Leonhart

Article also states that 4/10 people renting can afford a mortgage, most of whom are under 35, so, this could mean really it's 3/10 under 35s can buy. Small difference perhaps, but it's a 25% change.

Speedwell

amdublin wrote: »

Yes but not having a credit card is not seen as a negative for mortgage application. In ireland.
Obviously a negative if you have one and don't pay it back! !!!

Is the op applying American lending criteria to her think?

I'm not the OP, but you mean me? Yes, very likely, and thanks for calling attention to the point.

Cuddlesworth

whiskeyman wrote: »

It's says 'afford a mortgage', but never says for how much or where.

Rubbish article

Pretty much, a deposit in Dublin can buy a house outright in other areas of the country.

Michael D Not Higgins

This smacks of government pressure on RTE to write something to get people buying houses

"Incidentally why do they stress test mortgages with an additional 2% interest when interest rates are probably going to remain static for the next 10 years?"

Because it's prudent, idiots!

"people under the age of 35 are likely to pounce in the property market once confidence returns. This in turn could drive up the market in some areas"

Quick, buy a house!

"The ideal Rainy Day Fund (RDF - for emergencies, sudden loss of income or that investment opportunity e.g. the 10% deposit requirement for your home)"

No, a rainy day fund shouldn't be raided for an "investment opportunity".

L1011

handlemaster wrote: »

With this in mind what is holding people back from buying that can buy ?

Some people don't want to buy.

gaius c

whiskeyman wrote: »

It's says 'afford a mortgage', but never says for how much or where.

Rubbish article

It also assumes that everybody WANTS to buy as soon as they can financially do so. It suits some people to rent and not tie themselves down to one location with a long-term financial commitment.

Or they can continue saving to increase their deposit for when they do buy.

billymitchell

I'm 35 and can afford a mortgage now. But since I live in Dublin, i can onl afford a mortgage on a small 2/3 bed house. I am going to keep putting my savings away for another few month while house prices continue to fall off and try afford myself a house I want to live in for life rather than just buying a starter home just for the sake of "getting on the ladder".

dori_dormer

We have the full 20% deposit and fees etc. We are planning to rent for one more year so we have money for furniture etc easily. Reasons to keep renting are mainly that there is diddly squat worth buying. They are all over priced dumps looking for 600k and need another 100k to live in, in or preferred dublin areas. They aren't worth 400. Proof being that they haven't budged from daft in 6 months. There is very little on the market. Same in our other preferred areas in North kildare. For some reason nothing decent is coming on. They are either over priced or have tiny north facing gardens etc. No decent family homes around thati can find. Also i have an aversion to tiny new builds with no front gardens etc.

Squall Leonhart

billymitchell wrote: »

..rather than just buying a starter home just for the sake of "getting on the ladder"

I completely disagree with this notion of "getting on the ladder" too. Buy a house you can realistically see yourself living in for life. Don't buy a house with intentions of "moving up" in a few years. For reasons x,y,z you may never be able to leave your "starter home".

amdublin

Speedwell wrote: »

I'm not the OP, but you mean me? Yes, very likely, and thanks for calling attention to the point.

Oops sorry! Yes meant yourself. You should have a talk in the bank if you are interested in a mortgage at some point. The differences between us and ireland are hard to get head around (and vice versa!).
Ironically something good in ireland is bad in america. And something good in america is bad in ireland.

Alf Veedersane

gaius c wrote: »

You're an idiot to be paying rent to live 30 minutes from work really!

When I rented, I was always 30 mins or so from work.

I preferred it that way.

Skatedude

What a piece of rubbish article. a couple with 4500 net a month? What about reality? I'm single on a reasonable average tech wage of 30k gross. That means app 100k mortgage allowed based on the 3.5 times salary rule and You cannot buy anything for that?

OleRodrigo

Skatedude wrote: »

What a piece of rubbish article. a couple with 4500 net a month? What about reality? I'm single on a reasonable average tech wage of 30k gross. That means app 100k mortgage allowed based on the 3.5 times salary rule and You cannot buy anything for that?

You'd get a one bed apartment.

Mink

Anything in our price range is crap, either we're going to have to get major raises in work and/or save more for the deposit, probably a bit of both!

A mortgage repayment on the type of house we'd like would be 2/3 of what we've been paying in rent for the past 7 years. And that was with one of us out of work for 4-5 months and with a baby coming along.

So yeah, we can afford it but still can't get approved for enough with the bank.

OfflerCrocGod

Skatedude wrote: »

What a piece of rubbish article. a couple with 4500 net a month? What about reality? I'm single on a reasonable average tech wage of 30k gross. That means app 100k mortgage allowed based on the 3.5 times salary rule and You cannot buy anything for that?

I don't know what you are doing in tech but if it's development get looking for another job asap because 30K is very low.

PhoenixParker

Skatedude wrote: »

What a piece of rubbish article. a couple with 4500 net a month? What about reality? I'm single on a reasonable average tech wage of 30k gross. That means app 100k mortgage allowed based on the 3.5 times salary rule and You cannot buy anything for that?

A couple with E4500 net a month is earning E32,500 pa annum each.
Seems pretty realistic to me.

Squall Leonhart

Skatedude wrote: »

What a piece of rubbish article. a couple with 4500 net a month? What about reality? I'm single on a reasonable average tech wage of 30k gross. That means app 100k mortgage allowed based on the 3.5 times salary rule and You cannot buy anything for that?

According to this link https://en.wikipedia.org/wiki/List_of_European_countries_by_average_wage, the average monthly net income in Ireland is €2129, so the example in the article is still €242 shy of what the average couple can put towards a mortgage. However, data is from Q3 2013 so it may have increased somewhat since then, in all likelihood it actually has.

However those figures reinforce the undeniable fact that buying alone is a non-starter for the majority of people in Ireland at the moment. Even those on a €70k/yr job in Dublin could "only" borrow €245K, which would offer precious little in Dublin.

6541

I can afford a Mortgage. But in my opinion you would be insane to purchase property in Ireland now. Again this is my opinion. It is akin to buying something that you actually don't really know the value of.
The market is completely distorted. It's like going to a market in one of them north African countries and haggling with the Market trader. You both know the price is rubbish, you agree somewhere in the middle and even at that you are still getting ripped off.
If you can afford to hold back do because my opinion is the market is Fooked !

Captain Chaos

6541 wrote: »

If you can afford to hold back do because my opinion is the market is Fooked !

I'm not too sure myself, alot of people are now being forced to buy as there is little to nothing left to rent in Dublin. That's what I see happening lately. Most of my friends and myself that didn't buy during the boom now have to move back home with the folks to save up as rents are too high to try and save.

I'm sorry I didn't buy back when the banks were throwing money at people. Now I've only about 3 years left to make my move or be stuck with silly high rents for life. Alot of banks won't even look at you if you are over 35 now.

6541

Captain Chaos wrote: »

I'm not too sure myself, alot of people are now being forced to buy as there is little to nothing left to rent in Dublin. That's what I see happening lately. Most of my friends and myself that didn't buy during the boom now have to move back home with the folks to save up as rents are too high to try and save.

I'm sorry I didn't buy back when the banks were throwing money at people. Now I've only about 3 years left to make my move or be stuck with silly high rents for life. Alot of banks won't even look at you if you are over 35 now.

I know what you mean - but there is a few things going on here, again all this is my opinion and it would be great to get a economist opinion. House price costs in Ireland have been manufactured upwards in order to clear the negative equity.

I really believe we are on the cusp of a major crash in world economies. Ireland as an open economy is going to get hammered in first quarter 2017.

So again if you are in a position to stay with parents and save I would. There is just too much uncertainly at the moment.

whiskeyman

6541 wrote: »

If you can afford to hold back do because my opinion is the market is Fooked !

Hold back and do what?
And in what way is the market 'fooked'?

If you want to buy and can afford it, I don't see the benefit of 'holding back' as long as you've done the maths.

6541

whiskeyman wrote: »

Hold back and do what?
And in what way is the market 'fooked'?

We have a very real housing crisis. where zero builds have happened in the last number of years. So therefore the market is wrong.
Eventually houses will have to be built or they will have to release the repossessed houses so if you can hold back do.

whiskeyman

6541 wrote: »

We have a very real housing crisis. where zero builds have happened in the last number of years. So therefore the market is wrong.
Eventually houses will have to be built or they will have to release the repossessed houses so if you can hold back do.

But by that stage, the CB rules may be relaxed and credit could be more available, thus driving up prices in 'high demand' areas once again.
You can't define the market as 'wrong' just because supply is very sluggish.

Many simply have no other option but to 'hold back' as they try to gather a deposit, but I very much doubt anyone who has approval / funds and affordability is going to hold back.

handlemaster

6541 wrote: »

whiskeyman wrote: »

Hold back and do what?
And in what way is the market 'fooked'?

We have a very real housing crisis. where zero builds have happened in the last number of years. So therefore the market is wrong.
Eventually houses will have to be built or they will have to release the repossessed houses so if you can hold back do.

Add your reply here.


The market crashed 9 years ago. People have been on about these repossessed houses hitting the market and bringing prices down for years . These even if it were true that there is a sea of ideally located homes to come to the market would not make much difference. If your in Dublin renting a three bed home for your family thats 15k in rent per year... What your waiting for is costing you...

Cuddlesworth

handlemaster wrote: »

Add your reply here.


The market crashed 9 years ago. People have been on about these repossessed houses hitting the market and bringing prices down for years . These even if it were true that there is a sea of ideally located homes to come to the market would not make much difference. If your in Dublin renting a three bed home for your family thats 15k in rent per year... What your waiting for is costing you...

I paid 80 quid for a tap on Saturday and the whole day doing repairs on my MIL's house. Work which would costs most people 1k plus. 15K in rent is not equal to base mortgage payments without taking into account cost of ownership.

johnnyskeleton

Was does 4/10 under 35s can buy a house even mean? 4/10 people under 35 have the minimum deposit on the minimum house with a salary to boot? Or have a sufficient deposit and salary to buy where they are currently renting? Or could get a loan from their parents to buy their dream home.

If its based on the possibility of buying for working people i.e. 10% deposit on a 90k house in mullingar commuting to dublin, I would be amazed that only 40% of people under 35 have only 9k saved and a salary of under 30k. But equally i understand why someone renting and working in dublin wouldnt give that up to buy a place with a long commute to dublin.

Equally, however, of all people aged under 35 a good proportion must be under 21, still in school or college, so no surprises that they cant afford to buy.

Its a completely meaningless statistic IMO.

Eugene Norman wrote: »

He seems to be pushing a buy a house at all costs (rather than an appartment) but there's no evidence apartments don't sell on. All of these articles are agenda driven.

That seems to be the gyst of what hes saying. That may be true as general advice, but looking at dublin today, houses are far more overpriced than apartments. Apartments in dublin citycentre, for example, are still getting yeilds of 7% plus. That cant be said for many suburban houses that i can see.

Damnyou

Could I aford a mortgage on my own in Kilkenny/Waterford where I'm from absoloutly. Will I get a mortgage there while having to work in Dublin and pay rent as well? No as I would just be working for the house. If I get a decent paying job on the south east will I get a mortgage myself. Absolutely.

Barely Hedged

Skatedude wrote: »

What a piece of rubbish article. a couple with 4500 net a month? What about reality? I'm single on a reasonable average tech wage of 30k gross. That means app 100k mortgage allowed based on the 3.5 times salary rule and You cannot buy anything for that?

You can buy just not where you want to buy.

If you want to buy somewhere you think you should live, get a promotion or move jobs.

riclad

You could maybe buy an old house or a 1bed apartment for 100k.There.s lots of houses under 200k on daft.ie,
unless you are like it must be on the southside or else i,m not interested .

Heisenberg.

This post has been deleted.

Mink

Captain Chaos wrote: »

Now I've only about 3 years left to make my move or be stuck with silly high rents for life. Alot of banks won't even look at you if you are over 35 now.

Why is this and do you have any recent examples?

Cuddlesworth

Mink wrote: »

Why is this and do you have any recent examples?

It think he is referencing mortgage terms. Assuming 30 years as standard, banks would hesitate to offer one at 35(a fair number of people struggle to work in their mid 60's). Nothing stopping shorter terms.

SarahMollie

billymitchell wrote: »

I'm 35 and can afford a mortgage now. But since I live in Dublin, i can onl afford a mortgage on a small 2/3 bed house. I am going to keep putting my savings away for another few month while house prices continue to fall off and try afford myself a house I want to live in for life rather than just buying a starter home just for the sake of "getting on the ladder".

Do you really think prices are going to fall off?I agree the rate of growth is slowing, but I don't think prices will actually go down anytime soon, especially not in better areas.

whiskeyman

SarahMollie wrote: »

Do you really think prices are going to fall off?I agree the rate of growth is slowing, but I don't think prices will actually go down anytime soon, especially not in better areas.

I'm seeing a lot of price drops on asking prices at the moment in 'decent' areas.
The CB rules are really hitting in now I feel.

SarahMollie

whiskeyman wrote: »

I'm seeing a lot of price drops on asking prices at the moment in 'decent' areas.
The CB rules are really hitting in now I feel.

I'd be more inclined to go via the PPR - the property websites can be full of awful nonsense. Also some vendors are just greedy and need time to realise that they can't simply add 15% to whatever a similar house sold for a year previously.

I agree that the rules are having an impact but there are still significant supply constraints in Dublin. Rents are still rising. I know a lot of people who are just being delayed by the rules, but still intend to buy.

Also, I think the volumes of sales actually going through is still on the floor. Its hard to read much into anything based on such a low volume of transactions.

I bought last year and the main reason was that my repayments are less than my rent. Capital gains are not a priority for me, as I'll always need a roof over my head.

Ray Palmer

I Am The Law wrote: »

Houses are too expensive, property owners are trying to pass on boom time mistakes to the next generation of buyers. People who are prudent at this point are to be congratulated.

I think you are missing the full meaning of supply and demand. Prices have to be high enough for supply to provide it at a price.

gaius c

Heisenberg. wrote: »

This post has been deleted.

That's an excellent strategy. I wouldn't be able to sleep at night if I had the debt load some of my peers do.

gaius c

Ray Palmer wrote: »

I think you are missing the full meaning of supply and demand. Prices have to be high enough for supply to provide it at a price.

Urgh. We're back to this nonsense again.