Property Market 2019

JJJackal

voluntary wrote: »

CSO stats would cater for that. They publish adjusted figures.

The Residential Property Price Index does - but not the random numbers quoted for mean houses price (median would be a better reflection)

Ray Palmer

voluntary wrote: »

beaz2018 wrote: »

Are you assuming that every house in Dublin has gone down in value by this amount based on a CSO headline % number? Surely certain areas will improve/fall in price over time quicker/slower than others depending on a number of factors.

It's more a theretical and statistics/average/trend/sentimets based consideration.

But that's how trends are being established. When prices decrease over a period of time, it's more likely that they will keep decreasing as potential buyers hold off. There's the lower cost aspect associated with delayed purchase. When prices go up, they're likely to continue going up, as there's this 'missing the train' aspect of a purchase and higher cost associated with a purchase delay.

There were no houses on my road for sale so the casual observer this meant the last price sold for was the value of the houses in the area. The thing is nobody was willing to sell at a price lower than the last price. Now some say the house is only worth what people were willing to pay. The reality is the people selling have to be willing to sell at that price and if not the price is not the value. That is basic supply and demand.
When prices went up people were willing to sell. A few sold and the prices have continually gone up including new to market properties. Prices haven't dropped in the area but gone up. The market is so segmented that you can't make a blanket price drop statement and be accurate. Houses aren't really directly comparable with 3 bed houses being wildly different sizes.

JJJackal

Another way to look at house prices is they are back to 2005 levels - essentially no increase in house prices in 14 years - over time and it shown in many countries house prices increase (as inflation increases and the value of money decreases)

q85dw7osi4lebg

voluntary wrote: »

The key thing is, nobody should be forced into purchasing a property to live in for life if he's not settled yet in one place for good. The current situation with rents reaching extreme levels is doing just that - forcing people to buy (and get stuck). This can't end up well and many current buyers will lose out on career oportunities and/or relocation options or even personal live choices.

Why can't someone who buys a home sell a home ?

Dolbhad

Rex Disgusting Tariff wrote: »

Why can't someone who buys a home sell a home ?

It’s not that you couldn’t sell the house. I think it would cost you more if you bought a house to sell in two or three years. So if you were in a new job or company has a few offices and possibility of moving - you may prefer to rent for awhile.

If your fixed for a few years, you’ll have a breakage fee for that, if you had a broker they could claw back their fee within 3 years, HTB if used could be clawed back, solicitor fees, auctioneer fees and the cost of moving to new place. In addition you wouldn’t have paid off much the mortgage.

lcwill

Mickiemcfist wrote: »

Ok replying in order

1) 40k deposit is under 100 a month on a 400k home spread over the length if you want to add that
2) 30/35 years of paying mortgage vs paying rent until you die
3) True
4) House prices typically fall & rise together, so the house you'd be moving to would also be comparitavely cheaper, so there's little transactional difference
5) Nobody has suggested that, however looking at the last recession I'd much rather have been a homeowner than a tenant, homeowners seem to be immune from eviction


Even assuming the same monthly cost to rent vs buy, its a choice between renting forever, or paying a fixed amount over 35 years which eventually finishes, there's very little pro's in the rent forever column.

Another important factor is that rent is going to tick up with inflation, while your mortgage repayment will not.

So in 35 years the mortgage payment will seem pretty small, while rent will continue to eat up a similar percentage of your income forever.

voluntary

cruizer101 wrote: »

Think you have you calculations a bit off on this one with current interest rates.

A 300k mortgage @2.6% will have repayment of 1,200 which in first month is 650 interest and 550 capital by 4 years in you are payment more off the capital than you are in interest.

Interest is a big expense alright but its far off paying interest only initially.

The example in question was a 400k house. Assuming 10% own funds, makes a loan of 360.

The most common rate today would be more 2.9 than 2.6%, so 10,440 interests in the first year only which is ~870 per month. So yes, I was a bit off with 1k, but not that far off.

voluntary

lcwill wrote: »

Another important factor is that rent is going to tick up with inflation, while your mortgage repayment will not.

So in 35 years the mortgage payment will seem pretty small, while rent will continue to eat up a similar percentage of your income forever.

I see you mentioned the inflation. The interest rates are correlated with inflation in a long run.

Every 1% interest increase on 360k loan equals 3600 extra in annual interest (300 extra interest each month).

The ECB rate is 0% at this time. It hit ~5% before the financial shock in 2007.
I can only imagine what the variable Irish mortgage rates would be if ECB rates jump to 3 or 4%. This could add 1200+ on top of monthly repayments (~15k extra annually).

daithiK1

voluntary wrote: »

I see you mentioned the inflation. The interest rates are correlated with inflation in a long run.

what?

PokeHerKing

voluntary wrote:

I see you mentioned the inflation. The interest rates are correlated with inflation in a long run.

They are correlated but a rise in interest rates tends to cause deflation as people spend less. Low interest rates tend to cause inflation due to people borrowing and spending more.

airportgirl83

How many square meters is ideal for 2 people in late 30s, no kids? Is it a crazy idea to be looking at 4 bed houses?

We are torn between buying a cheaper 3 bed house 300-350k (mortgage 700pm) and pay it off quicker or 4 bedroom little bit outside of Dublin for around 450k (mortgage 1.1k) with loads of space.

We will be looking to work less (4 days) and travel more in the next 10-15 years. We will need extra room for parents to visits.

Think our search is getting out of control. I know that we are looking at houses that are possibly way to big for us but we are scared of being stuck in an unsuitable house like many during the recession. In the normal property market, we would go for a smaller house, sell if needed in the future and get sth else but that's not the case here.

Doop

airportgirl83 wrote: »

How many square meters is ideal for 2 people in late 30s, no kids? Is it a crazy idea to be looking at 4 bed houses?

We are torn between buying a cheaper 3 bed house 300-350k (mortgage 700pm) and pay it off quicker or 4 bedroom little bit outside of Dublin for around 450k (mortgage 1.1k) with loads of space.

We will be looking to work less (4 days) and travel more in the next 10-15 years. We will need extra room for parents to visits.

Think our search is getting out of control. I know that we are looking at houses that are possibly way to big for us but we are scared of being stuck in an unsuitable house like many during the recession. In the normal property market, we would go for a smaller house, sell if needed in the future and get sth else but that's not the case here.

I wouldnt say its crazy to look at a 4 bed... do you ever plan on having a family? We just bought a small 3 bed my partner and I will not have children, downstairs is open plan and 1 bedroom is already given over to a desk/study with no room for a bed, so effectively we only have one spare room for guests which is fine, but slightly limiting too. That said we moved from a 1bed apt so were happy!

I would probably say get the biggest and best you can afford/mortgage will allow. Your salary's are likely to increase over time so you will become more comfortable on the repayments as time goes on.... #my2c

voluntary

Doop wrote: »

I would probably say get the biggest and best you can afford/mortgage will allow. Your salary's are likely to increase over time so you will become more comfortable on the repayments as time goes on.... #my2c

I used to live in a large 4/5 bed house for a while, BER C1 so not that bad. The heating bills were killing us thought. It gets expensive to run a large house so unless you're going for an A rated one then think twice. The purchase price is only a start of your spending jurney.

airportgirl83

Doop wrote: »

airportgirl83 wrote: »

How many square meters is ideal for 2 people in late 30s, no kids? Is it a crazy idea to be looking at 4 bed houses?

We are torn between buying a cheaper 3 bed house 300-350k (mortgage 700pm) and pay it off quicker or 4 bedroom little bit outside of Dublin for around 450k (mortgage 1.1k) with loads of space.

We will be looking to work less (4 days) and travel more in the next 10-15 years. We will need extra room for parents to visits.

Think our search is getting out of control. I know that we are looking at houses that are possibly way to big for us but we are scared of being stuck in an unsuitable house like many during the recession. In the normal property market, we would go for a smaller house, sell if needed in the future and get sth else but that's not the case here.

I wouldnt say its crazy to look at a 4 bed... do you ever plan on having a family? We just bought a small 3 bed my partner and I will not have children, downstairs is open plan and 1 bedroom is already given over to a desk/study with no room for a bed, so effectively we only have one spare room for guests which is fine, but slightly limiting too. That said we moved from a 1bed apt so were happy!

I would probably say get the biggest and best you can afford/mortgage will allow. Your salary's are likely to increase over time so you will become more comfortable on the repayments as time goes on.... #my2c

Thanks for that. We might have one child but I'd say it's unlikely at this stage as we are both in late 30s and more interested in our hobbies and seeing the world tbh

I get what you are saying about an office. We both do good bit on our computers so one room will have to be an office with double desk space.

airportgirl83

voluntary wrote: »

Doop wrote: »

I would probably say get the biggest and best you can afford/mortgage will allow. Your salary's are likely to increase over time so you will become more comfortable on the repayments as time goes on.... #my2c

I used to live in a large 4/5 bed house for a while, BER C1 so not that bad. The heating bills were killing us thought. It gets expensive to run a large house so unless you're going for an A rated one then think twice. The purchase price is only a start of your spending jurney.

Yes, looking at new A rated houses with heat to water pump. Gave up a bit on 2nd hand houses at this stage.

voluntary

PokeHerKing wrote: »

They are correlated but a rise in interest rates tends to cause deflation as people spend less. Low interest rates tend to cause inflation due to people borrowing and spending more.

Interest rates trail the inflation, not the vice versa. Interest rates are decided post-factum and take recent inflation into consideration (as well as forcasts). The higher the inflation recorded, the higher the rates are likely to be set. Generally a target inflation is somthing about 3%, so whenever the inflation goes above that level expect interest rates to move sharply up to prevent hiper inflation.

I'm not speculating whether or when the inflation will move up or down. Just pointing to the fact, that mortgage monthly repayments will change when this happens.

Jaster Rogue

airportgirl83 wrote: »

Yes, looking at new A rated houses with heat to water pump. Gave up a bit on 2nd hand houses at this stage.

There are disadvantages to new builds you need to consider also. Annual management fees (that can rise any time), minimum 10% social housing in the estate, parking issues, no front gardens, small back gardens, not yet established neighbourhoods (+less proximity to good schools, public transport, parks, facilities, etc), living on a construction site for the first few years. There's additional costs you need to consider also like flooring (can cost 5k for decent flooring on a standard 3 bed semi).

airportgirl83

Jaster Rogue wrote: »

airportgirl83 wrote: »

Yes, looking at new A rated houses with heat to water pump. Gave up a bit on 2nd hand houses at this stage.

There are disadvantages to new builds you need to consider also. Annual management fees (that can rise any time), minimum 10% social housing in the estate, parking issues, no front gardens, small back gardens, not yet established neighbourhoods (+less proximity to good schools, public transport, parks, facilities, etc), living on a construction site for the first few years. There's additional costs you need to consider also like flooring (can cost 5k for decent flooring on a standard 3 bed semi).

That's very true. I've considered all above. My question is about size not new vs 2nd hand.

awec

Jaster Rogue wrote: »

There are disadvantages to new builds you need to consider also. Annual management fees (that can rise any time), minimum 10% social housing in the estate, parking issues, no front gardens, small back gardens, not yet established neighbourhoods (+less proximity to good schools, public transport, parks, facilities, etc), living on a construction site for the first few years. There's additional costs you need to consider also like flooring (can cost 5k for decent flooring on a standard 3 bed semi).

Not all new builds have management fees. Also new builds are not necessarily further from schools

Zenify

lcwill wrote: »

Another important factor is that rent is going to tick up with inflation, while your mortgage repayment will not.

Supply is a far bigger factor than inflation. If and it's a big if supply is fixed rent will come way down. I'm not arguing that rent is better just that it's not going to increase based on inflation over 30 years.

PokeHerKing

voluntary wrote:

Interest rates trail the inflation, not the vice versa. Interest rates are decided post-factum and take recent inflation into consideration (as well as forcasts). The higher the inflation recorded, the higher the rates are likely to be set. Generally a target inflation is somthing about 3%, so whenever the inflation goes above that level expect interest rates to move sharply up to prevent hiper inflation.

voluntary wrote:

I'm not speculating whether or when the inflation will move up or down. Just pointing to the fact, that mortgage monthly repayments will change when this happens.

Yes so like I said high interest rates will lead to deflation. Low interests rates will lead to inflation. At least in theory.

I thought you were inferring the opposite in your response to the poster discussing rents/inflation.

beauf

airportgirl83 wrote: »

Thanks for that. We might have one child but I'd say it's unlikely at this stage as we are both in late 30s and more interested in our hobbies and seeing the world tbh

I get what you are saying about an office. We both do good bit on our computers so one room will have to be an office with double desk space.

Only you know that. I struggle with space for IT gear and bicycles and DIY gear. Might depend on what your hobbies are though. Also if you regularly have people staying over.

beaz2018

airportgirl83 wrote: »

How many square meters is ideal for 2 people in late 30s, no kids? Is it a crazy idea to be looking at 4 bed houses?

We are torn between buying a cheaper 3 bed house 300-350k (mortgage 700pm) and pay it off quicker or 4 bedroom little bit outside of Dublin for around 450k (mortgage 1.1k) with loads of space.

We will be looking to work less (4 days) and travel more in the next 10-15 years. We will need extra room for parents to visits.

Think our search is getting out of control. I know that we are looking at houses that are possibly way to big for us but we are scared of being stuck in an unsuitable house like many during the recession. In the normal property market, we would go for a smaller house, sell if needed in the future and get sth else but that's not the case here.

If I had no kids and no plan to have them, Id choose a nicer 3 bed over a 4 bed. A better kitchen/living area will be more worth it than an extra bedroom lying empty most of the time.

airportgirl83

beaz2018 wrote: »

airportgirl83 wrote: »

How many square meters is ideal for 2 people in late 30s, no kids? Is it a crazy idea to be looking at 4 bed houses?

We are torn between buying a cheaper 3 bed house 300-350k (mortgage 700pm) and pay it off quicker or 4 bedroom little bit outside of Dublin for around 450k (mortgage 1.1k) with loads of space.

We will be looking to work less (4 days) and travel more in the next 10-15 years. We will need extra room for parents to visits.

Think our search is getting out of control. I know that we are looking at houses that are possibly way to big for us but we are scared of being stuck in an unsuitable house like many during the recession. In the normal property market, we would go for a smaller house, sell if needed in the future and get sth else but that's not the case here.

If I had no kids and no plan to have them, Id choose a nicer 3 bed over a 4 bed. A better kitchen/living area will be more worth it than an extra bedroom lying empty most of the time.

That's good point. We spend more time in the living area than in bedrooms.

Jaster Rogue

awec wrote: »

Not all new builds have management fees.

Can you name one development that doesn't? Not doubting you, just not something I've personally seen. Not in Dublin or surrounding counties anyway.

airportgirl83

Jaster Rogue wrote: »

awec wrote: »

Not all new builds have management fees.

Can you name one development that doesn't? Not doubting you, just not something I've personally seen. Not in Dublin or surrounding counties anyway.

No management fees: Hamilton Park Castleknock, Beresford and Rahillion Donabate as examples from my experience.

Places closer to town like RCP, Rathborne Park in Ashton, Grace Park Wood all have management fees.

Jaster Rogue

airportgirl83 wrote: »

No management fees: Hamilton Park Castleknock

Hamilton Park - you're right about the houses actually, it's the apartments that have management fees.

awec

Jaster Rogue wrote: »

Can you name one development that doesn't? Not doubting you, just not something I've personally seen. Not in Dublin or surrounding counties anyway.

We bought a new build in Wicklow and there's no management fees. Will be the council.

Trumpet22

I've been reading about how the mortgage lending rules are stopping the prices from going up.

I then looked at Wicklow in Q3 2015. Average house price - 277,000.

Q4 2018. Average house - 334,000.

That's an increase of 20% in 3 years.


In my opinion the rules have only pushed up rents, which in turn pushes up house prices because investors get a high yield.

The mortgage rules are not your friend. They are forcing house prices up while you get ripped to shreds paying massive rents.

Lefty Bicek

Samuel T. Cogley wrote: »

If you're not in a position to save at a given rent you're not in a position to take a mortgage at that same level,

Why not ?