House sold, sitting on deposit. Scared of inflation

cluelessbuyer9

Hi, in need of advice.

We sold our family home due to separation recently, i have moved home and am currently sitting on my share (190,000). I would like to buy sooner rather than later but can't find property for my needs concurrently. I need a 4 bed in Dublin as i have 4 kids, the max i could spend is around 370,000 but i cannot find any property on the market right now.

The idea of staying put for a year or two to save more and see if suitable property emerges is appealing to me but i am not getting any younger (39) and keep hearing news of inflation on the radio and i am cautious of putting the deposit into other investment vehicles as they look like bubble territory right now.

I am getting anxiety of inflation eating my only source of wealth but i have lost every bidding war i entered (15 in total) and have a limited budget at the moment.

Caranica

Why do you need a 4 bed for 4 kids, would a 3 bed not do? Your budget should stretch to a 3 bed, doubtful for a 4 bed.

HillCloudHop

Prize bonds are your only option with a timeframe of 1-2 years, but you'll need some luck to beat inflation.

cluelessbuyer9

HillCloudHop wrote: »

Prize bonds are your only option with a timeframe of 1-2 years, but you'll need some luck to beat inflation.

I had not thought of that, will check them out. I don't necessarily plan on beating inflation but want my 190,000e to still hold value and be considered a somewhat respectful deposit that would leave a low enough mortgage when i decide the purchase.

cluelessbuyer9

Fwiw - i will be staying in my fathers where there is space and the length of stay is not an issue so i'm told. I would ideally want to move out sooner rather than later but could stretch it out for two or three years if needed. Do people expect prices to cool down or will they keep going sky high? As lifetime FF voters my extended family appear to be moving to SF in the next election, if SF win we think more houses may be built but this will take some time to come to fruition.

StupidLikeAFox

cluelessbuyer9 wrote: »

Fwiw - i will be staying in my fathers where there is space and the length of stay is not an issue so i'm told. I would ideally want to move out sooner rather than later but could stretch it out for two or three years if needed. Do people expect prices to cool down or will they keep going sky high? As lifetime FF voters my extended family appear to be moving to SF in the next election, if SF win we think more houses may be built but this will take some time to come to fruition.

Wouldn't be depending on that as this government has 4 more years if they go full term and even if SF came in tomorrow they don't have a magic switch to ramp up supply overnight

Allinall

In my opinion, you should buy what you can afford, as soon as possible.
It is virtually impossible to time the market.

For example, if someone convinced you now, that prices would drop by 33% in two years, you would think “Happy days. I’ll wait.”

Two years on, and the prices have indeed dropped by 33%.
You are now thinking “Will I hold out a bit longer, as prices have been dropping consistently for the last two years?”
Six months on, and prices have risen again.

Point is, at any given time, prices may drop ( or if you are selling- rise).

Buy now, and relax in the knowledge that whatever the market does, it effects you not.

lalababa

Anything could happen with prices BUT there is a very short supply so I'd expect modest rises at least.
Tis sh##y you lost out on 15 houses.
If you really want yer own gaff I'd look for 3,2, bed houses that maybe you could use the living room split it for two bedrooms etc. Or divide up the kids into two bedrooms etc...you know ways around the dilemma.
Plenty of Fine normal people grew up in shared bedrooms . We had six of us kids in the one room. Then we were split up to two kids to a room till college age.
I know several families in times gone by where there were 6 to a Small room until 18ish. ...something like a hostel dorm.

cluelessbuyer9

lalababa wrote: »

Anything could happen with prices BUT there is a very short supply so I'd expect modest rises at least.
Tis sh##y you lost out on 15 houses.
If you really want yer own gaff I'd look for 3,2, bed houses that maybe you could use the living room split it for two bedrooms etc. Or divide up the kids into two bedrooms etc...you know ways around the dilemma.
Plenty of Fine normal people grew up in shared bedrooms . We had six of us kids in the one room. Then we were split up to two kids to a room till college age.
I know several families in times gone by where there were 6 to a Small room until 18ish. ...something like a hostel dorm.

This is a new perspective that is worth considering, thank you.

I had bid on a 3 bed with the view to convert the attic but it went for 85,000 over asking. 360,000 asking to 445,0000

cluelessbuyer9

Allinall wrote: »

In my opinion, you should buy what you can afford, as soon as possible.
It is virtually impossible to time the market.

For example, if someone convinced you now, that prices would drop by 33% in two years, you would think “Happy days. I’ll wait.”

Two years on, and the prices have indeed dropped by 33%.
You are now thinking “Will I hold out a bit longer, as prices have been dropping consistently for the last two years?”
Six months on, and prices have risen again.

Point is, at any given time, prices may drop ( or if you are selling- rise).

Buy now, and relax in the knowledge that whatever the market does, it effects you not.

I see your point, but i am not trying to time it per se as it's not an investment property, more so to see if more property come onboard and prices level off or just drop slightly.

I'm constrained with what i can borrow but honestly wouldn't be comfortable borrowing more for the available stock. Some stock i looked at sold for forty or fifty thousand euros cheaper in 2019, when, in reality nothing has changed for the better. The economy is in the toilet and unemployed high so i don't want to borrow more if this is just artificial panic causing prices to go up.

Caranica

cluelessbuyer9 wrote: »

This is a new perspective that is worth considering, thank you.

I had bid on a 3 bed with the view to convert the attic but it went for 85,000 over asking. 360,000 asking to 445,0000

Why do you need 4 bedrooms? As has been pointed out, kids sharing rooms is very normal. I'm taking it you won't have full tool time custody?

Friend just bought a 2 bed in North county Dublin for 330k, that's the market you're looking in

CIARAN_BOYLE

You suggest a 4 bed in Dublin for 4 kids.

So there's 3 rooms for kids. Your saying it's OK for 2 of the kids to share but there's no possibility for others to share.

You might need to suck it up and say sorry kids you get 2 bedrooms between you when you visit here.

cluelessbuyer9

Caranica wrote: »

Why do you need 4 bedrooms? As has been pointed out, kids sharing rooms is very normal. I'm taking it you won't have full tool time custody?

Friend just bought a 2 bed in North county Dublin for 330k, that's the market you're looking in

2 bed for 330,000 is not worth it imo. I need an office for my business also.

cluelessbuyer9

cluelessbuyer9 wrote: »

Some stock i looked at sold for forty or fifty thousand euros cheaper in 2019, when, in reality nothing has changed for the better. The economy is in the toilet and unemployed high so i don't want to borrow more if this is just artificial panic causing prices to go up.

It's not artificial panic.

Two of the primary things the average 30-something office worker has been doing during lockdown:
a) saving money - either on purpose or for lack of reasons to spend it; and
b) staring at the four walls around them.

In this demographic alone, the number of people looking to buy, especially in Dublin, has soared.

Add to that the number of people who had weddings planned over the last 18 months who have had to cancel all their bookings and have been stuck at home together considering plans for their future - that cash is now looking like a good deposit on a house.

That's just a small snippet of the factors at play in terms of demand. I'm 100% against trying to anticipate the market, so I wont pretend to know that supply won't catch up, but it's certainly nothing to do with artificial panic.

Caranica

cluelessbuyer9 wrote: »

2 bed for 330,000 is not worth it imo. I need an office for my business also.

In their case it was worth it for location.

Garden shed? Fold away desk? Corner of your bedroom?

If you don't have the kids full time there are lots of ingenious office solutions that will mean you don't need one dedicated room.

0lddog

Caranica wrote: »

Why do you need a 4 bed for 4 kids, would a 3 bed not do? ....

https://www.ikea.com/ie/en/cat/bunk-beds-19048/

Darc19

In 30 years of buying and selling and moving and keeping an eye on the market, the sensationalist media and estate agents have NEVER got it right when it comes to pricing.

And I think they are very wrong now.

There's a short term shortage. There are 20,000+ new builds coming on stream between now and early next year.

You also have similar number that will come from people passing away ( media always forget this supply source)

Central Bank won't make many changes to rules and with many tech companies allowing work from home for at least two days a week, the pressure on Dublin prices will ease very soon.

Buying now would mean paying over the odds imo.

Mimon

cluelessbuyer9 wrote: »

Fwiw - i will be staying in my fathers where there is space and the length of stay is not an issue so i'm told. I would ideally want to move out sooner rather than later but could stretch it out for two or three years if needed. Do people expect prices to cool down or will they keep going sky high? As lifetime FF voters my extended family appear to be moving to SF in the next election, if SF win we think more houses may be built but this will take some time to come to fruition.

Obvious troll is obvious, seriously?

Allinall

Mimon wrote: »

Obvious troll is obvious, seriously?

If you’ve nothing constructive to add, why bother posting ****e?

Darc19

Mimon wrote: »

Obvious troll is obvious, seriously?

DOH, yep. And feck I fell for it

Mrs OBumble

Darc19 wrote: »

.... and with many tech companies allowing work from home for at least two days a week, the pressure on Dublin prices will ease very soon.

Buying now would mean paying over the odds imo.

Not for 4 beds though: with WFH, the number of bedrooms that are being converted into offices is staggering.

Working at the kitchen table was OK for the height of the health-emergency but won't be acceptable to companies long term. Neither will uninsulated garden sheds.

Bass Reeves

Did you look at new houses. As a women with 4 children you would be high up the list for affordable housing I imagine. Contact the different housing associations.

I think as a separated person you can be considered as a FTB. This give you access to the HTB funding. This gives you 10% of house value in tax back over last 4years this year while you may not reach the maximum of the funding next year when it's reduced to 5% you might.

You could also look at government co-founding scheme ( shared equity)where they will lend you up to 30% of the purchase price. There is no interest for 5 years and after that interest is added at 2.5%.

On a 500k new house if you bought it next year.

5% tax back 25k HTB
Deposit 200k (I presuming you save the extra 10k)
Mortgage 180 k
Co-funding up to 150 k but in your case you would only need to access about 100 k of it

I think this is the only way that you can access housing

Edit
Just looking at the HTB you may not be able to access that as you cannot access a mortgage large enough. It would add 25k to the shared equity

bilbot79

cluelessbuyer9 wrote: »

I had not thought of that, will check them out. I don't necessarily plan on beating inflation but want my 190,000e to still hold value and be considered a somewhat respectful deposit that would leave a low enough mortgage when i decide the purchase.

There is another thread on prize bonds that I'm following and it looks that recently prizes have whittled down to pretty much zero. They must be linked to interest rates

Mimon

Allinall wrote: »

If you’ve nothing constructive to add, why bother posting ****e?

Come on, was obviously trolling, just pointing it out.

Apologise if you want

Flinty997

The only hope of property falling is a recession. As govts have propped up their economies this is unlikely in the short term now. The other thing is falling demand either through falling immigration and emigration. Neither of those seems likely either. The final thing would be over supply. That isn't going to happen for years. We've never hit a building target ever.

Darc19

Mimon wrote: »

Come on, was obviously trolling, just pointing it out.

Apologise if you want

Especially with the "forced to sell family home" in another thread.

There's never a forceful sale that leaves €190k share.

Flinty997

Darc19 wrote: »

Especially with the "forced to sell family home" in another thread.

There's never a forceful sale that leaves €190k share.

Forced through separation not financial.

If you separated with older kids you might have a mortgage mostly paid off, and perhaps other asset's. Leaving you a chunk of cash but not asset's and not enough to buy somewhere. Especially if you are tied to expensive area due to kids and work etc.

Bass Reeves

Darc19 wrote: »

Especially with the "forced to sell family home" in another thread.

There's never a forceful sale that leaves €190k share.

OP can only access 180 k through mortgage. She requires a 3 bed or maybe 4 bed house with four children. In her forties I stead of being financially secure she with a mortgage virtually paid off she has to start again. She will be at retirement age before this house is paid off. Time is against her every year she waits is a year off the length of time she can take out a mortgage for.
She has access to her previous house equity 190 k and 180k if potential mortgage. It would have made more financially sense to have tried to hd on to her old home but she was obviously unable to access the finance to buy out her husband.

In solicitor feed for that sale and this purchase as well as auctioneer fees there is about 12-15k in money gone. As well with house prices rising and being now a single person trying to buy she will struggle to access a house

Darc19

Bass Reeves wrote: »

OP can only access 180 k through mortgage. She requires a 3 bed or maybe 4 bed house with four children. In her forties I stead of being financially secure she with a mortgage virtually paid off she has to start again. She will be at retirement age before this house is paid off. Time is against her every year she waits is a year off the length of time she can take out a mortgage for.
She has access to her previous house equity 190 k and 180k if potential mortgage. It would have made more financially sense to have tried to hd on to her old home but she was obviously unable to access the finance to buy out her husband.

In solicitor feed for that sale and this purchase as well as auctioneer fees there is about 12-15k in money gone. As well with house prices rising and being now a single person trying to buy she will struggle to access a house

And it's your answer that convinces me it's a troll.

Btw, nothing says it's a he or a she.

If the person the op has created is a woman with four children, and mortgage was near paid off, a court would never ever ever agree to a sale of the property

It's a total bullsh1t op especially when you look at the posts in other threads

athlone573

They may be a troll

But the answer is the same
You can't beat inflation without taking risk (just stick it in the bank or prize bonds)
And nobody knows the outlook for house prices over the next few years.

CIARAN_BOYLE

bilbot79 wrote: »

There is another thread on prize bonds that I'm following and it looks that recently prizes have whittled down to pretty much zero. They must be linked to interest rates

It was reduced to 0.35% on average at the start of the year. It was 0.5% before that.

I think it was higher again before that.

Bass Reeves

Darc19 wrote: »

And it's your answer that convinces me it's a troll.

Btw, nothing says it's a he or a she.

If the person the op has created is a woman with four children, and mortgage was near paid off, a court would never ever ever agree to a sale of the property

It's a total bullsh1t op especially when you look at the posts in other threads

They may or may ot. The situation is possible. If the house was sold the judgement may have been 12-18 months ago. They may have moved house or have only purchased this house when there first or second child was born. If it was a 25 year mortgage they would only be half way through. They have equity from the SE and probably savings. Four children could have a total 7-8 years age gap add 5-6 for the youngest and could only put them half way through the mortgage.

Would a judge order the sale of a house. Where there is substantial equity he generally would. If the order was granted 2 years ago it might at the time have seem a reasonable ruling. 350k would have bought a house or apartment.

If the mortgage was unsustainable for the OP by themselves ( ie. they could not get agreement from mortgage provider to put it in OP's name) then a judgement to sell might have been approved. Remember OP spouse has a housing need as well and if his name was on the loan he could not borrow for himself.
I have seen this situation back in 2015/16.

cluelessbuyer9

CIARAN_BOYLE wrote: »

You suggest a 4 bed in Dublin for 4 kids.

So there's 3 rooms for kids. Your saying it's OK for 2 of the kids to share but there's no possibility for others to share.

You might need to suck it up and say sorry kids you get 2 bedrooms between you when you visit here.

Forgot to mention i have a 19 year old from a previous relationship staying two nights per week plus four children under the age of twelve.

cluelessbuyer9

Darc19 wrote: »

In 30 years of buying and selling and moving and keeping an eye on the market, the sensationalist media and estate agents have NEVER got it right when it comes to pricing.

And I think they are very wrong now.

There's a short term shortage. There are 20,000+ new builds coming on stream between now and early next year.

You also have similar number that will come from people passing away ( media always forget this supply source)

Central Bank won't make many changes to rules and with many tech companies allowing work from home for at least two days a week, the pressure on Dublin prices will ease very soon.

Buying now would mean paying over the odds imo.

Thanks for taking the time, i hope you're right.

Experience_day

Seems like renting the best way forward for yourself imho....

inflation might be a swine but the market is certainly....uncertain.......

Flinty997

cluelessbuyer9 wrote: »

Thanks for taking the time, i hope you're right.

People have been saying this for about 10 yrs though. Supply going to explode and demand fall through the floor.

Flinty997

cluelessbuyer9 wrote: »

Forgot to mention i have a 19 year old from a previous relationship staying two nights per week plus four children under the age of twelve.

What you want isn't in Dublin. I realize that's useless advice. But from a space and cost POV Dublin's the worse place to be.

cluelessbuyer9

Flinty997 wrote: »

People have been saying this for about 10 yrs though. Supply going to explode and demand fall through the floor.

Sooner or later they will be right.

cluelessbuyer9

cluelessbuyer9 wrote: »

Sooner or later they will be right.

Looks like it will be later.

cluelessbuyer9

Dav010 wrote: »

Looks like it will be later.

It could be but many expects have been wrong in the past.

cluelessbuyer9

cluelessbuyer9 wrote: »

It could be but many expects have been wrong in the past.

This time house price rises are not built on easy credit or average wage earners buying BTL’s, it is due to lack of supply due to low build rates and huge demand even though there are stringent rules applied by the CB to ensure those who borrow can afford it. Neither are supply likely to increase, nor demand decrease to the extent that prices will drop any time soon.

You are right about the experts though, many expected the pandemic to cause prices to at least stagnate, but the supply/demand issues are so serious in Ireland, that prices continue to rise. Hence why I think hopes of price falls at least over the next few years is wishful thinking.

berocca2016

Check out this property I found using Daft

https://www.daft.ie/for-sale/semi-detached-house-6-oldtown-gardens-naas-co-kildare/3282836

Maybe look outside Dublin?

CrabRevolution

Dav010 wrote: »

This time house price rises are not built on easy credit or average wage earners buying BTL’s, it is due to lack of supply due to low build rates and huge demand even though there are stringent rules applied by the CB to ensure those who borrow can afford it. Neither are supply likely to increase, nor demand decrease to the extent that prices will drop any time soon.

You are right about the experts though, many expected the pandemic to cause prices to at least stagnate, but the supply/demand issues are so serious in Ireland, that prices continue to rise. Hence why I think hopes of price falls at least over the next few years is wishful thinking.

Massive house price rises are a worldwide phenomenon after the pandemic:

https://www.ft.com/content/3082fe00-cdb7-4eb9-ab2d-2309b9848114 Presumably behind a paywall but:

House prices have set records in the US and parts of Europe as vast fiscal and monetary stimulus help residential property markets to continue shrugging off the impact of the coronavirus pandemic.

AndrewJRenko

berocca2016 wrote: »

Check out this property I found using Daft

https://www.daft.ie/for-sale/semi-detached-house-6-oldtown-gardens-naas-co-kildare/3282836

Maybe look outside Dublin?

Daft has more than 50 4-bed properties for under €375k for sale in Dublin right now.

Flinty997

cluelessbuyer9 wrote: »

Sooner or later they will be right.

Broken clock is right twice a day. You are right there.

JustAThought

cluelessbuyer9 wrote: »

Hi, in need of advice.

We sold our family home due to separation recently, i have moved home and am currently sitting on my share (190,000). I would like to buy sooner rather than later but can't find property for my needs concurrently. I need a 4 bed in Dublin as i have 4 kids, the max i could spend is around 370,000 but i cannot find any property on the market right now.

The idea of staying put for a year or two to save more and see if suitable property emerges is appealing to me but i am not getting any younger (39) and keep hearing news of inflation on the radio and i am cautious of putting the deposit into other investment vehicles as they look like bubble territory right now.

I am getting anxiety of inflation eating my only source of wealth but i have lost every bidding war i entered (15 in total) and have a limited budget at the moment.

Wherabouts in Dublin do you have to commute to work? Where do your kids go to school ? Is moving their school a possibility?

Didn’t a Spanish bank/company offering longer term mortgages at fixed for life rates of a maximum of 2% start offering mortgages in Ireland recently? Surely with your deposit of almost 50% and 20 years left ‘working’ and a loan to value rate as good as you will have you clild avail of their even lower, fixed lifetime loan rates - this would leave you with more flexibility and bargaining power?

Can you buy a 3 and extend?

What would people in Dublin city center tell me in 2007 when I could tell them that in 2008 many of them will lose jobs and them property will cost half price ?
Everybody would point them finger to me laughing and tell me that You are sick.
That is all about inflation,demand and supply and recession not gona happen
We are in recession already and growing people savings show that many of them does not believe any government stories about recovery and inflation

If I could sit on 190K I would invest 50K to gold coins and sit on rest waiting for crash.

I am not believe a single word from any media since 2007 and never will again.

[Deleted User]

[Deleted User] wrote: »

What would people in Dublin city center tell me in 2007 when I could tell them that in 2008 many of them will lose jobs and them property will cost half price ?
Everybody would point them finger to me laughing and tell me that You are sick.
That is all about inflation,demand and supply and recession not gona happen
We are in recession already and growing people savings show that many of them does not believe any government stories about recovery and inflation

If I could sit on 190K I would invest 50K to gold coins and sit on rest waiting for crash.

I am not believe a single word from any media since 2007 and never will again.

I suspect the people were too busy applying for easy credit and going around to the many estates looking at houses available to buy, two conditions which do not exist today.

With interests rates at zero on savings, inflation means you would be losing quite a lot on your €140k over the years. That’s sound financial advice.

Dav010

Dav010 wrote: »

I suspect the people were too busy applying for easy credit and going around to the many estates looking at houses available to buy, two conditions which do not exist today.

With interests rates at zero on savings, inflation means you would be losing quite a lot on your €140k over the years. That’s sound financial advice.

The gold will absorb inflation loses.
I am better will lose my 140 000 in 50 years by 2 per cent inflation per year than I will spend them on property which will lose at least 50 per cent value during next crash

I bought property in 2007 listening the same songs about inflation and in 2008 I lost 60 per cent of value.
Even today I still lost 30 per cent of the price because price of the property are low by 30 per cent than I spent in 2007
When another crash will happen I will lose again

Better I was sitting on bag of money and spend them in 2008.

SteM

Revolution 1917 wrote: »

The gold will absorb inflation loses.
I am better will lose my 140 000 in 50 years by 2 per cent inflation per year than I will spend them on property which will lose at least 50 per cent value during next crash

I bought property in 2007 listening the same songs about inflation and in 2008 I lost 60 per cent of value.
Even today I still lost 30 per cent of the price because price of the property are low by 30 per cent than I spent in 2007
When another crash will happen I will lose again

Better I was sitting on bag of money and spend them in 2008.

How much rent would you have paid since 2007 ,you would have needed to live somewhere. Did you factor that into your figures? I bought in 2007 too. Would have spend approx 168000 in rent since then, have spent less on my mortgage in that time.

SteM

SteM wrote: »

How much rent would you have paid since 2007 ,you would have needed to live somewhere. Did you factot that into your figures? I bought in 2007 too. Would have spend approx 16800 in rent since then, have spent less on my mortgage in that time.

Paying rent I save money
Paying mortgage I spend money for mortgage and interest
When crash happen I play back money spent for rent and money which I have spend pay interest
Buying house now I will pay 250 000
Buying house during crash I will spend 125 000 plus saving money which I had to pay taking mortgage at 250 000
Buying for 125 K I could pay cash
There is many ways for calculation oposite your way
Paying rent is not wasting money it's freedom also