"You might as well wait until the next recession...

it's 8 years since the last one started."

I never looked at it like that until a colleague said it when I explained my situation to him. What's the considered opinion here on buying property in southeast Dublin (for family reasons I'm stuck here)? I'm looking around here and the quality of stuff available for the price is egregiously bad (under €500k). Any place with potential to add value to it is usually no cheaper than comparable houses after the refurbishment, extension is done - e.g. the house for €300k but that costs €300k to make decent won't really get more than 600k if the other houses for sale in the area are a guideline.

The bank will give me a mortgage of €485k so with my €150k in savings I could technically go for a loan for just over €600k. But I don't want to take that on me so €500k is my absolute limit. The thing is, the difference between similar houses in this area in 2012 and 2016 is in the hundreds of thousands of euro, and if I wait for the next slump I would in effect be saving myself many years of work.

Would you hold off on buying in this area now, or go for it?

Goat Paddock

Fuaranach wrote: »

it's 8 years since the last one started."

I never looked at it like that until a colleague said it when I explained my situation to him. What's the considered opinion here on buying property in southeast Dublin (for family reasons I'm stuck here)? I'm looking around here and the quality of stuff available for the price is egregiously bad (under €500k). Any place with potential to add value to it is usually no cheaper than comparable houses after the refurbishment, extension is done - e.g. the house for €300k but that costs €300k to make decent won't really get more than 600k if the other houses for sale in the area are a guideline.

The bank will give me a mortgage of €485k so with my €150k in savings I could technically go for a loan for just over €600k. But I don't want to take that on me so €500k is my absolute limit. The thing is, the difference between similar houses in this area in 2012 and 2016 is in the hundreds of thousands of euro, and if I wait for the next slump I would in effect be saving myself many years of work.

Would you hold off on buying in this area now, or go for it?

If you wait till the next recession, will the banks still be lending then? Maybe you could just save until then, could be a while though! It might never happen, or it probably will, who knows.

Tombo2001

Fuaranach wrote: »

it's 8 years since the last one started."

I never looked at it like that until a colleague said it when I explained my situation to him. What's the considered opinion here on buying property in southeast Dublin (for family reasons I'm stuck here)? I'm looking around here and the quality of stuff available for the price is egregiously bad (under €500k). Any place with potential to add value to it is usually no cheaper than comparable houses after the refurbishment, extension is done - e.g. the house for €300k but that costs €300k to make decent won't really get more than 600k if the other houses for sale in the area are a guideline.

The bank will give me a mortgage of €485k so with my €150k in savings I could technically go for a loan for just over €600k. But I don't want to take that on me so €500k is my absolute limit. The thing is, the difference between similar houses in this area in 2012 and 2016 is in the hundreds of thousands of euro, and if I wait for the next slump I would in effect be saving myself many years of work.

Would you hold off on buying in this area now, or go for it?

Retrospective point in time stuff can produce any result you want.

A house buyer in 2005 would have saved themselves a lot of money by waiting until 2010 to purchase.

A house buyer in 2000 would not have.

In 2000, house prices had been on the up for 8 years.

We've just had the biggest property crash ever in the country. Does that mean we will have another massive property crash? I don't know. Your mate doesn't know.

Everything looks easy in hindsight.

What were people saying in 2012? "You're better off renting".

Captain Flaps

I'm 28 and hearing someone say they have €150k saved is giving me a panic attack.

SparklesBlood

Captain Flaps wrote: »

I'm 28 and hearing someone say they have €150k saved is giving me a panic attack.

I was just thinking the same thing lol, most I could buy is a monopoly house.

hytrogen

I'd say at the rate the market is going you're looking at a different family home model being a family apartment instead of a family house in the next 10 to 15 years with the push for more efficient use of land around the big cities.
That said, the M50 is now the ringed "D-fortress" in terms of allowing family's move into the capital so you're probably going to be looking else where along the commuter belts for more affordable prices comparably. Equally it also depends on your necessity to purchase & secure a property, noone has a crystal ball, only cynics & wise men can comment on the future..

hytrogen

Also I can think of many other things to do with €150k that would be more useful... like buying a boat or going travelling, even with new born's!

...And Justice

I pulled out of a house deal in 2006 because I thought I was being shafted €385k for a mid terraced house. I kept saving money and then bought a house that was slashed from €450k to €210 in 2010. I'm glad I did. Op the only way there's going to be another recession is if there massive layoffs in the pharmaceutical industry or all the MNC's flee the country. House building is non existent, so unless we start building even then there wouldn't be enough houses to go round, it'll probably be decades before you see another house building crash like 2008.

testicle

Captain Flaps wrote: »

I'm 28 and hearing someone say they have €150k saved is giving me a panic attack.

I'm 36 and I feel the same...

Barely Hedged

Fuaranach wrote: »

it's 8 years since the last one started."

I never looked at it like that until a colleague said it when I explained my situation to him. What's the considered opinion here on buying property in southeast Dublin (for family reasons I'm stuck here)? I'm looking around here and the quality of stuff available for the price is egregiously bad (under €500k). Any place with potential to add value to it is usually no cheaper than comparable houses after the refurbishment, extension is done - e.g. the house for €300k but that costs €300k to make decent won't really get more than 600k if the other houses for sale in the area are a guideline.

The bank will give me a mortgage of €485k so with my €150k in savings I could technically go for a loan for just over €600k. But I don't want to take that on me so €500k is my absolute limit. The thing is, the difference between similar houses in this area in 2012 and 2016 is in the hundreds of thousands of euro, and if I wait for the next slump I would in effect be saving myself many years of work.

Would you hold off on buying in this area now, or go for it?

Assuming a LTI ratio of 3.5, youre earning approximately €140k pa. If thats the calibre of response from a colleague of similar standing in your line of work, you should do very well in your career.

All things considered economically and rental-wise, what are you waiting for?

pwurple

op, we have done both.... Waited until the recession to buy, and bought during a rising market. Couple of problems are the ferocious interest we caught during the recession, and the difficulty getting mortgages.

Tracker +0.5% = teensy tiny interest rate of 0.5% for place bought in 2007
Variable @4.2% = recession interest rate. It's monstrous, hopefully will receed during the next few years.

Approved for much MUCH smaller sums during a recession, compared to not. 4 of the 5 banks we applied to would not even quote us, despite having 40% deposit saved.

For a family home, buy when it suits your life. You could be trying to outsmart the market for decades.

Eugene Norman

Barely Hedged wrote: »

Assuming a LTI ratio of 3.5, youre earning approximately €140k pa. If thats the calibre of response from a colleague of similar standing in your line of work, you should do very well in your career.

All things considered economically and rental-wise, what are you waiting for?

He said. A recession.

Eugene Norman

I don't doubt there will be a world recession in about a year or so.

It's telling that somebody with 150k and earning 140k is finding it tough in this economy. I don't think that's too sustainable.

shugy

150k would buy you a nice little pad in the west. Do your life a favour, move, buy, be mortgage free for rest of your life and enjoy a stressful free life knowing you've no rope attached around your kneck that is 500k.

Eugene Norman

shugy wrote: »

150k would buy you a nice little pad in the west. Do your life a favour, move, buy, be mortgage free for rest of your life and enjoy a stressful free life knowing you've no rope attached around your kneck that is 500k.

I'm thinking the same. Even buy that house and rent in Dublin for a while. Try convince a company to let you work from home eventually.

BannerBarry

Hey, I know a nice little farm and farmhouse for sale in the west... €599k the lot :-)... I can't honestly say stress free but a different stress!

groovyg

Op I think you have to look at the rent you are paying and whether you would be paying less by buying rather than renting. The rental situation is getting worse in Dublin.

quadrifoglio verde

Who is to say the next recession will lead to a property crash of 50%
And if they do crash by 50%, that could well put them at today's current prices
And you'll have paid rent until then.

Or you could find somewhere you're happy in for the foreseeable future and no longer worry about rent increases or falls/rises in the price of property and instead you can concern yourself with issues such as what colour to paint the walls and how to stop the dog from digging up the lawn

Del2005

shugy wrote: »

150k would buy you a nice little pad in the west. Do your life a favour, move, buy, be mortgage free for rest of your life and enjoy a stressful free life knowing you've no rope attached around your kneck that is 500k.

Not many places in the west paying 140k and some people have no interest in living in areas where houses are that cheap.

Eugene Norman

quadrifoglio verde wrote: »

Who is to say the next recession will lead to a property crash of 50%
And if they do crash by 50%, that could well put them at today's current prices
And you'll have paid rent until then.

You're anticipating an increase of 100% before a fall?

Or you could find somewhere you're happy in for the foreseeable future and no longer worry about rent increases or falls/rises in the price of property and instead you can concern yourself with issues such as what colour to paint the walls and how to stop the dog from digging up the lawn

God knows interest rates are stuck at 0% for ever.
Of course the rental situation is scandalous though.

Rew

Fuaranach wrote: »

Any place with potential to add value to it is usually no cheaper than comparable houses after the refurbishment, extension is done - e.g. the house for €300k but that costs €300k to make decent won't really get more than 600k if the other houses for sale in the area are a guideline.

Is it an investment or a decent family home you want?

Barely Hedged

Eugene Norman wrote: »

He said. A recession.

Your post seems to suggest you're of the same calibre as his work colleague's, as you completely ignored the context of the question

Barely Hedged

Eugene Norman wrote: »

I don't doubt there will be a world recession in about a year or so.

It's telling that somebody with 150k and earning 140k is finding it tough in this economy. I don't think that's too sustainable.

Ahh yeah. If it's not massive repossessions coming soon, Eurozone crisis, Greek elections, equities are overpriced, the Irish economy is based on FDI - what if the FDI leaves in the morning and so on and so forth ad nauseam.

OP, there will always be a cohort of people who will grab onto the coat tails of any hint of economic malaise and extrapolate the arse out of it to convince themselves a recession is around the corner, not this year, but every year. There is no fall of 50% coming, if the last fall of 50% was nearing banking apocalypse - and I don't mean that as an exaggeration.

Go ahead, what are you waiting for?

Man007

Tombo2001 wrote: »

What were people saying in 2012? "You're better off renting".

http://touch.boards.ie/thread/2056534623/1

The_Conductor

OP- you're looking at property and suggesting there is a dearth of opportunities to add value to whatever is on the market for sale (in your chosen area) at the moment. I'd argue that you should move away from looking at buying a 'do'er-upper' and if you want to buy somewhere to live in- just do it.

I've a colleague who spent 780k on a property in Dun Laoghaire recently- he pretty much had to gut it (to the extent the roof had to be replaced)- and he spent a total of 600k doing it up. In total he has spent almost 1.4m on it- he's lucky, he had family money to fall back on- but the issue is- his property is perhaps worth 850-900 now- after he has spent massively rehabilitating it- and he is in his 30s and didn't intend to buy it as a 'forever-after' home........

Its almost impossible to 'add-value' to property in the current market- regardless of how you upgrade a property your costs will not be realised in a net increase in the value of the property- so get that thought out of your head.

Barely Hedged

The_Conductor wrote: »

OP- you're looking at property and suggesting there is a dearth of opportunities to add value to whatever is on the market for sale (in your chosen area) at the moment. I'd argue that you should move away from looking at buying a 'do'er-upper' and if you want to buy somewhere to live in- just do it.

I've a colleague who spent 780k on a property in Dun Laoghaire recently- he pretty much had to gut it (to the extent the roof had to be replaced)- and he spent a total of 600k doing it up. In total he has spent almost 1.4m on it- he's lucky, he had family money to fall back on- but the issue is- his property is perhaps worth 850-900 now- after he has spent massively rehabilitating it- and he is in his 30s and didn't intend to buy it as a 'forever-after' home........

Its almost impossible to 'add-value' to property in the current market- regardless of how you upgrade a property your costs will not be realised in a net increase in the value of the property- so get that thought out of your head.

Completely agree and sellers are well aware of it. There is little or no opportunities to add equity in the form of refurbishment on single standard properties at the moment because the market is starved of these properties. The only ones you stand to make money on are large marquee period properties or buying houses in bulk, refurbishing and then shifting

lisasimpson

I can see OPs point. Im in cork renting and buying gone crazy herebtoo and beginning to think it will be the next recession too before i can afford something. Also lease is up in 3 months so nees to find somewhere else to live. Looks like ill be paying a lot more for a room which will impact my savings

Stealthfins

This reminds me of the Celtic tiger all over again.
For your own sake don't get caught up buying a huge priced property in the East.
As you go towards your 40's your outlook will change and rather than the city life,you'll be heading west for weekends away and will be thinking how quite peaceful and much easier our way of life is.

The clever single ones with money relocated west,bought a house in the country a good reliable car and found a job within a reasonable radius of home.

There's nothing worse than driving back to Dublin from Dingle,Sligo,Galway,Donegal, Doolin,Ennistymon,Liscannor or Lahinch after a weekend of Fishing,Surf,eating out cliff and shoreline edge walks,nice pubs and restaurants.
No traffic jams or fumes.

Butters1979

Stealthfins wrote: »

This reminds me of the Celtic tiger all over again.
For your own sake don't get caught up buying a huge priced property in the East.
As you go towards your 40's your outlook will change and rather than the city life,you'll be heading west for weekends away and will be thinking how quite peaceful and much easier our way of life is.

The clever single ones with money relocated west,bought a house in the country a good reliable car and found a job within a reasonable radius of home.

There's nothing worse than driving back to Dublin from Dingle,Sligo,Galway,Donegal, Doolin,Ennistymon,Liscannor or Lahinch after a weekend of Fishing,Surf,eating out cliff and shoreline edge walks,nice pubs and restaurants.
No traffic jams or fumes.

This is just another "you should want to live where I want to live, not where you want to live"

OP has already explained they want east Dublin for family reasons. Why don't you just accept that and discuss the actual question. Not everyone wants to live in the west. I certainly don't.

To OP, there may be another recession, but even if there is it doesn't necessarily mean the house prices will drop that much. The last recession was a pretty spectacular banking collapse that happened right at the same time over supply hit the market. It was a prefect storm I for one don't think will repeat.

If you're in a position to buy something that you want to live in for a long time, then why not? The sooner you buy the sooner you can live in your own home and the sooner you will be mortgage free. If it's a case that you can't find anything you like for the price, then don't just buy for the sake of it.

How long are you willing to wait for the recession, and when it comes will you still be in a position to get a mortgage. Don't forget how many people found themselves out of work in the last recession. House price falls didn't help them.

MarkAnthony

Barely Hedged wrote: »

Assuming a LTI ratio of 3.5, youre earning approximately €140k pa. If thats the calibre of response from a colleague of similar standing in your line of work, you should do very well in your career

Just becuase someone is well paid it doesn't mean they have any idea of the housing market. Jobs in IT, the medical field and even retail could pay that much, why would they have anything other than a passing knowledge of the housing market?

Furthermore, it seemed to be the previaling attitude here until about a year/18 months ago.

OP Why are you stuck in SE Dublin specifically if you don't mind me asking. Could you move to the NE of Dublin?

SarahMollie

People need to look differently towards buying a roof over their heads than to making an investment. They're not, nor should they necessarily be the same thing.

If you can afford the repayments, and the house is somewhere you want to live for the next 10+ years, then go for it. Hopes of a rising market or whatever are nonesense, because you will always need a roof over your head.

I firmly believe those who are now sitting on the fence waiting for the next recession will be sitting there for a while. It might ultimately work out for them, but then again it might not. Who knows. Fact is you need somewhere to live and rent presently costs a fortune.

You should only be thinking about "potential" etc, if its an investment property.

Barely Hedged

MarkAnthony wrote: »

Just becuase someone is well paid it doesn't mean they have any idea of the housing market. Jobs in IT, the medical field and even retail could pay that much, why would they have anything other than a passing knowledge of the housing market?

Furthermore, it seemed to be the previaling attitude here until about a year/18 months ago.

OP Why are you stuck in SE Dublin specifically if you don't mind me asking. Could you move to the NE of Dublin?

People earning that much don't know anything about investments or asset purchases. Don't cod yourself will you.

The prevailing attitude for a small number or regular posters, not posters at large.

quadrifoglio verde

Eugene Norman wrote: »

You're anticipating an increase of 100% before a fall?

Christ no....what I'm saying is that I don't know when the next crash will occur that will see prices fall by the 40 odd % the OP thinks thinks they should/work colleague thinks they should, and in the meantime, none of us know how much properties are going to rise before the next fall

A recession won't necessarily lead to a house price collapse either, if they're not overpriced in the first place
The only way they'll become overpriced is if the demand evaporates completely which as it stands I can't see happening for a good while

Stealthfins

Butters1979 wrote:

This is just another "you should want to live where I want to live, not where you want to live"

Not really

Goat Paddock

Hopefully imo the central bank rules stay in place, they seem to me to be a sensible limit, which will be good in the long term, and result in a less boom and bust, greedy dependence on growth at all costs attitude.

mad_baker

quadrifoglio verde wrote: »

Christ no....what I'm saying is that I don't know when the next crash will occur that will see prices fall by the 40 odd % the OP thinks thinks they should/work colleague thinks they should, and in the meantime, none of us know how much properties are going to rise before the next fall

A recession won't necessarily lead to a house price collapse either, if they're not overpriced in the first place
The only way they'll become overpriced is if the demand evaporates completely which as it stands I can't see happening for a good while

agree with this , recessions happen more regular than most people think and they are often much shorter in duration than most think ( as short as six months ) , what we had from the peak of early 2007 to the very beginning of 2012 was a borderline depression , not a generational event but a multi generational shock to the economy , a perfect storm of the worst international recession since the thirties which had at its core the banking system , add to the fact we had experienced a twelve year rise in property prices

our fall from early 2007 to early 2012 was much longer and much deeper than is typical of a housing correction - crash , we certainly overshot the top during the bubble ( more so in rural ireland BTW where there was and is no reason for high house prices ) but we also overshot the bottom during the crash , even people who had money were paralysed with fear and would not spend , add in a complete evaporation of credit and we had absolutely screaming buys in dublin

if i had the money or inclination ( i dont live in dublin ) , i would buy in dublin right now , what has changed in the past eight years is the huge increase in the importance of the dublin economy and the huge decrease in the importance of the economy outside dublin ( cork and especially galway city excluded ) , dublin is richer today and has a bigger economy than it did at the peak of early 2007 , this trend will continue , dublin will continue to grow as the phenomenon of rural to urban migration continues ( ireland was way behind the curve in this for decades )

its very possible house prices in dublin go nowhere for two or three years but expecting a return or early 2012 levels is fantasy , if that happens , im not sure even owning a house will save people so whats the point in waiting , rents in dublin are not even that high compared to most european capitals so dont expect that to change

Barely Hedged

mad_baker wrote: »

agree with this , recessions happen more regular than most people think and they are often much shorter in duration than most think ( as short as six months ) , what we had from the peak of early 2007 to the very beginning of 2012 was a borderline depression , not a generational event but a multi generational shock to the economy , a perfect storm of the worst international recession since the thirties which had at its core the banking system , add to the fact we had experienced a twelve year rise in property prices

our fall from early 2007 to early 2012 was much longer and much deeper than is typical of a housing correction - crash , we certainly overshot the top during the bubble ( more so in rural ireland BTW where there was and is no reason for high house prices ) but we also overshot the bottom during the crash , even people who had money were paralysed with fear and would not spend , add in a complete evaporation of credit and we had absolutely screaming buys in dublin

if i had the money or inclination ( i dont live in dublin ) , i would buy in dublin right now , what has changed in the past eight years is the huge increase in the importance of the dublin economy and the huge decrease in the importance of the economy outside dublin ( cork and especially galway city excluded ) , dublin is richer today and has a bigger economy than it did at the peak of early 2007 , this trend will continue , dublin will continue to grow as the phenomenon of rural to urban migration continues ( ireland was way behind the curve in this for decades )

its very possible house prices in dublin go nowhere for two or three years but expecting a return or early 2012 levels is fantasy , if that happens , im not sure even owning a house will save people so whats the point in waiting , rents in dublin are not even that high compared to most european capitals so dont expect that to change

Spot on. A good sequence of logical deduction and, I'd say, a natural conclusion to this thread

mad_baker

Stealthfins wrote: »

This reminds me of the Celtic tiger all over again.
For your own sake don't get caught up buying a huge priced property in the East.
As you go towards your 40's your outlook will change and rather than the city life,you'll be heading west for weekends away and will be thinking how quite peaceful and much easier our way of life is.

The clever single ones with money relocated west,bought a house in the country a good reliable car and found a job within a reasonable radius of home.

There's nothing worse than driving back to Dublin from Dingle,Sligo,Galway,Donegal, Doolin,Ennistymon,Liscannor or Lahinch after a weekend of Fishing,Surf,eating out cliff and shoreline edge walks,nice pubs and restaurants.
No traffic jams or fumes.

im originally from the east ( not dublin ) and live in the west , while i am happy , nothing can prepare you for how wet it is in the west , easily double the rain which falls in dublin , i eventually see myself moving back east when the kids are reared , the weather in galway truly is awful and no amount of culture and art can make up for it

as for those seeking a break from high dublin house prices but who want a job , the obvious choice is limerick city , limerick city houses are 35% cheaper than in galway city , 45% cheaper than in cork city and cheaper than any town within the dublin commuter belt including navan , trim , bray , naas , maynooth , newbridge , weather is slightly less wet than galway , its also big enough that you wont die of boredom

i dont live in limerick but my partner is from there , its dirt cheap for renting or buying

SarahMollie

Stealthfins wrote: »

This reminds me of the Celtic tiger all over again.
For your own sake don't get caught up buying a huge priced property in the East.
As you go towards your 40's your outlook will change and rather than the city life,you'll be heading west for weekends away and will be thinking how quite peaceful and much easier our way of life is.

The clever single ones with money relocated west,bought a house in the country a good reliable car and found a job within a reasonable radius of home.

There's nothing worse than driving back to Dublin from Dingle,Sligo,Galway,Donegal, Doolin,Ennistymon,Liscannor or Lahinch after a weekend of Fishing,Surf,eating out cliff and shoreline edge walks,nice pubs and restaurants.
No traffic jams or fumes.

I'm happy for you that the lifestyle in the west suits you and you find it fulfilling, but your assumption that everyone wants or should want the same is nonsense.

I very much like going out west for a week or two in the summer, but thats enough for me.

Would I give up my home in South County Dublin full time, to spend miserable cold winters in the wilds of Connamara - not a hope.

As much as you like to be able to do out doorsey things - I like the urban equivalent, like art house cinema, new bars/restaurants opening every week, museums etc, and being able to go out for a few drinks and simply pop on the Luas to get home. I also like having a good job that pays well. I wouldnt be able to do the work I do now if I was based in Lahinch for example.

m5ex9oqjawdg2i

Stealthfins wrote: »

This reminds me of the Celtic tiger all over again.
For your own sake don't get caught up buying a huge priced property in the East.
As you go towards your 40's your outlook will change and rather than the city life,you'll be heading west for weekends away and will be thinking how quite peaceful and much easier our way of life is.

The clever single ones with money relocated west,bought a house in the country a good reliable car and found a job within a reasonable radius of home.

There's nothing worse than driving back to Dublin from Dingle,Sligo,Galway,Donegal, Doolin,Ennistymon,Liscannor or Lahinch after a weekend of Fishing,Surf,eating out cliff and shoreline edge walks,nice pubs and restaurants.
No traffic jams or fumes.

This is an incredibly condisending post. Especially that part in bold. I wouldn't think that investing in property in the west to be clever or unclever.

One of the worst traffic jams I was ever in was in Dingle.

However lovely these places can be at times, the city can offer a lot more in terms of choice and emenities. Then there's the jobs. Many people working in Dublin can only work in Dublin due to their line of work.