Property Market 2017

Bob24

dealhunter1985 wrote: »

I notice the central bank guidance is 3.5 times annual salary for first time buyers.
When I put my details into the KBC calculator, it says i can get a mortgage that is closer to 4.25 times my salary.
Is it the case that the banks arent tied to the 3.5 multiple, that its only guidance?

thanks

Exceptions are allowed for part of their loan book. And it seems they are plenty for them to be able to allow many people who want to to go over the 3.5 times limit.

Graham

I think I read the general rule of thumb, single applicants earning over 50k, joint over 70k are more likely to be granted an exemption

Cyrus

AlmightyCushion wrote: »

A certain percentage of the mortgages they give out are exempt from those rules.

would be doubtful they show that on the online calculator

Cyrus

Bob24 wrote: »

Exceptions are allowed for part of their loan book. And it seems they are plenty for them to be able to allow many people who want to to go over the 3.5 times limit.

15% or so isnt it?

Ayuntamiento

I just put our salary details into the kbc calculator and they say that they would be happy to give us AIP for 600k as first time buyers.
That's about 4 times our combined income.

However, I actually just went through the mortgage process with KBC and bought a house. We found it hard to even get 380k from them!

So basically the calculator is a lie that's designed to lure you in!
I have to say, I'm glad that they wouldn't lend us anymore. I really don't want a mortgage repayment of over 1400 per month.
We have found house ownership so expensive thus far. Even on a €150k combined salary we are in debt as we try to furnish the place/fix it up.
I love my home and I'm glad that we bought it but I'd never view it as an asset or an investment. It's a black hole of money but it's my baby!

IronSteve

Graham wrote: »

I think I read the general rule of thumb, single applicants earning over 50k, joint over 70k are more likely to be granted an exemption

Any reliable source for this?
I heard similar but for high earners, but it's only conjecture

Graham

IronSteve wrote: »

Any reliable source for this?
I heard similar but for high earners, but it's only conjecture

One of the mortgage websites mentions the figures. No hard statistics, just based on their past experience I think.

dubrov

Exemption are not generally used for high earners.

They tend to be used for people with dependable incomes (e.g. public sector, semi-state) and also those who have lower Loan to values.

Hollister11

Well you no things are starting to get a bit bid when 1 bed apartments get pricey. A 1 bed apartment in Red Arches Drive, Baldoyle is up for €175K. The apartment is 495 SQ/FT.

I wouldn't mind for there a 2 bed (800sqft) a few minutes away in Myrtle for 195K.

One selling point possibly is the DART station <10 minutes away. So some young professional om decent money could buy this and save money on renting.

I suppose for 650 a month mortgage compared to 1200 rent. It's not as bad as it first looks.

jamesthepeach

Hollister11 wrote: »

Well you no things are starting to get a bit bid when 1 bed apartments get pricey. A 1 bed apartment in Red Arches Drive, Baldoyle is up for €175K. The apartment is 495 SQ/FT.

I wouldn't mind for there a 2 bed (800sqft) a few minutes away in Myrtle for 195K.

One selling point possibly is the DART station <10 minutes away. So some young professional om decent money could buy this and save money on renting.

I suppose for 650 a month mortgage compared to 1200 rent. It's not as bad as it first looks.

I just sold a 1 bed in north Dublin. Asking was high enough compared to what I thought it would get but in the end it got 20% higher than asking even. So I wouldn't be surprised to see that one going for a good bit more than asking in the end.
Ea was telling me apartments have taken off since Christmas. People finally coming to the conclusion houses are not coming down and they can't afford them. So its either buy an apartment and pay lower than rent monthly or just leave yourself to the rental market wherever that may go.

thirtythirty

Ayuntamiento wrote: »

However, I actually just went through the mortgage process with KBC and bought a house. We found it hard to even get 380k from them!

So basically the calculator is a lie that's designed to lure you in!
I have to say, I'm glad that they wouldn't lend us anymore. I really don't want a mortgage repayment of over 1400 per month.

Did you take the full 380k? Because I can't see how your payments are lower than 1400! Even at 30 years at 3%, payments would be €1600..

To me, interest rate risk is the biggest risk to housing currently. Nobody is pricing in 5, 6, or 7% rates when they say "it's cheaper to buy!"

Cyrus

thirtythirty wrote: »

Did you take the full 380k? Because I can't see how your payments are lower than 1400! Even at 30 years at 3%, payments would be ?1600..

To me, interest rate risk is the biggest risk to housing currently. Nobody is pricing in 5, 6, or 7% rates when they say "it's cheaper to buy!"

fix for 5 years at 3% to mitigate somewhat

Lumen

thirtythirty wrote: »

To me, interest rate risk is the biggest risk to housing currently. Nobody is pricing in 5, 6, or 7% rates when they say "it's cheaper to buy!"

7% rates would require base rates of something like 4.5%.

I'm not saying that can't happen, but nobody thinks that will happen. The Irish govt issued 20 year bonds in January 2017 at 1.7%.

mel123

Hollister11 wrote: »

Well you no things are starting to get a bit bid when 1 bed apartments get pricey. A 1 bed apartment in Red Arches Drive, Baldoyle is up for €175K. The apartment is 495 SQ/FT.

I wouldn't mind for there a 2 bed (800sqft) a few minutes away in Myrtle for 195K.

One selling point possibly is the DART station <10 minutes away. So some young professional om decent money could buy this and save money on renting.

I suppose for 650 a month mortgage compared to 1200 rent. It's not as bad as it first looks.

A two bed went up, prob 6-8 weeks ago now, i think it was 210/220. Went looking for it yesterday on myhome out of curiosity and its gone. Do you know if its sold?

Hollister11

mel123 wrote: »

A two bed went up, prob 6-8 weeks ago now, i think it was 210/220. Went looking for it yesterday on myhome out of curiosity and its gone. Do you know if its sold?

Where abouts?

mel123

Hollister11 wrote: »

Where abouts?

I think it was Boyd house...just asking, i know from your posts you follow that area, was just wondering if you knew did it sell/how much etc only for the nosiness :-)

jamesthepeach

mel123 wrote: »

A two bed went up, prob 6-8 weeks ago now, i think it was 210/220. Went looking for it yesterday on myhome out of curiosity and its gone. Do you know if its sold?

Apartments are going very fast now.
So many people sick of renting and rental stock going down only going to make things worse.

A 1 bed went up in swords the other day and I contacted the agent who I know from other dealings to ask what he expected to get for it.
It went up at €165k if I remember and he said he already had bids well over asking. He expects it to finally go for over 200k at this rate.

zl1whqvjs75cdy

Think it makes sense that 1 beds are going fast. There's a decent return to be made and the rental market is red hot. One bed is the easiest way into that cash cow. Combined with houses either not being available or just way too expensive.

I fear some people might be falling between both though. Buying the 1 bed for now with the intention of renting it out once they get eh deposit together for the "forever" house. All speculation on my part of course.

jamesthepeach

I couldn't wait to get out of the rental market since the new rules came in. Personally I think anyone who thinks it's a cash cow now is nuts.
But the mortgage on a 1 bed is still cheaper than renting it. So maybe that's what's happening.

zl1whqvjs75cdy

jamesthepeach wrote: »

I couldn't wait to get out of the rental market since the new rules came in. Personally I think anyone who thinks it's a cash cow now is nuts.
But the mortgage on a 1 bed is still cheaper than renting it. So maybe that's what's happening.

Agreed, but all we can see in the media is story after story on sky high rents. That has to be swaying some amateur landlords into the game.

pilly

Amaris Rich Clown wrote:

Agreed, but all we can see in the media is story after story on sky high rents. That has to be swaying some amateur landlords into the game.

Not if they're on Boards they won't!

theboringfox

pilly wrote: »

Not if they're on Boards they won't!

It's very odd in Ireland. We really go after this particular class of asset ownership. Real anti landlord sentiment. I'm not a landlord but I don't hear good things. Surely government should be encouraging investment in buy to lets especially on new build so as to grow housing stock. Lots of private money available to invest in housing stock but govt seem determined to make it a non runner for fear of being pro landlords, developors or ppl with money.

Hollister11

mel123 wrote: »

I think it was Boyd house...just asking, i know from your posts you follow that area, was just wondering if you knew did it sell/how much etc only for the nosiness :-)

Must be sale agreed. I remember it, nice place.

Keep an eye on property price register.

Outkast_IRE

theboringfox wrote: »

It's very odd in Ireland. We really go after this particular class of asset ownership. Real anti landlord sentiment. I'm not a landlord but I don't hear good things. Surely government should be encouraging investment in buy to lets especially on new build so as to grow housing stock. Lots of private money available to invest in housing stock but govt seem determined to make it a non runner for fear of being pro landlords, developors or ppl with money.

The government really only wants to encourage large scale private corporation landlords in the market. At the end of the day they are a hell of a lot more professional to deal with than some of the amateur landlords out there at the moment.

These large companies can borrow large amounts of money to get hundreds of apartments built at a time.

Taylor365

Landlord, Ireland, cash-cow?

:pac: :pac: :pac: :pac:

If you consider 2-5% a cash-cow.

City Center airb&b's are the only cash cows i see.

I'll be holding onto cash for the foreseeable, see what becomes of Dublin 5 years down the line.

dubrov

Taylor365 wrote:

If you consider 2-5% a cash-cow.

More like 6-8% plus capital appreciation.

Try and find anything close to that in any other asset class

myshirt

dubrov wrote: »

More like 6-8% plus capital appreciation.

Try and find anything close to that in any other asset class

I have a tip for a horse running this weekend if you want it

dubrov

myshirt wrote:

I have a tip for a horse running this weekend if you want it

It's a volatile bet alright but historically has been far more likely to win than lose.

Can't say that about a horse racing bet

Ray Palmer

dubrov wrote: »

More like 6-8% plus capital appreciation.

Try and find anything close to that in any other asset class

Let us look at somebody who bought to let in 2006. Th property cost them €300k and after cost and mortgage they have 10% their mortgage. All looks well until the crash suddenly you are getting less rent and you are subsiding the tenants and then there are new taxes.
Eventually rents rise and you can raise you rent but the tenants have been good and you are just breaking even and they are moving on soon. Then rent caps put in place and you have to give this preferential rate to the new tenant. It will take another 3 years to get to 10% and you hope they don't up the interest rate the whole time.
Still no capital appreciation and it has costed money the whole time

Baby01032012

dubrov wrote: »

More like 6-8% plus capital appreciation.

Try and find anything close to that in any other asset class

6-8% is gross before mortgage interest, repair, maintenance, non payment of rent, 52% tax..