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Should 100% mortgages return?

rob316

I think they should. It's unrealistic expecting young working people to raise 30k for a deposit while paying extortionate rent on the private market.

Maybe even 95%?

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Ipso

Someone with a bit more knowledge may be able to help me on this.
We had a property bubble in the early 2000's where houses were thrown up everywhere and then there were ghost estates, has the population increased so much in the mean time that there is now a shortage or were houses built in the wrong areas?

Also has a study been done comparing house prices as a multiple of income from around now looking back to the 80's?

[Deleted User]

padd b1975 wrote: »

I got a 100% 340,000 mortgage over 35 years in 2006 with my now ex wife.
In twelve years the principal has decreased by about 80k.
To be honest its not something I've dwelt on too much over the years, I just concentrate on meeting the repayment and everything that goes with it every month.

Meanwhile I have spent 66,000 euro on rent in the last 4 years. I'd be delighted if 100% mortgages came in. So long as it was done sensibly such as only people in permanent positions, 3.5 times of their salary etc.

rob316

MidMan25 wrote: »

100% with a requirement to pay back more in the first 5 years to reduce the principle?

It would solve the issue of people being well able to afford a mortgage repayment but not to save the 10% deposit while paying high rent, on the other hand as others said prices will be driven up.

There's a thinking man.

[Deleted User]

The UK had 130% mortgages!

rob316

RoboKlopp wrote: »

The UK had 130% mortgages!

With 6.5% interest. Ouch!

Sand

100% mortgages would just be a subsidy to developers and property owners, as they were in the past. The property "problem" in Ireland today is one of supply. Boosting demand only makes things even worse.

lawred2

100% mortgages to those with clear ability to repay shouldn't be much an issue.

Better than a 50% mortgage to someone who can't.

The Celtic tiger was fueled by reckless lending of all levels to people who were always going to be over stretched.

MayoSalmon

Not even 10 years removed from recession and I see this thread pops up. People really and truly deserve what they get in life (personal tragedies aside)

colm_mcm

monkeysnapper wrote: »

Did i dream it or did they at one point chuck a 100% mortgage plus a brand new Rover car at people ...

It was a Volvo c30

[Deleted User]

Yes, definitely. An inspired idea. 100% mortgages and they should be repayable over 40-45 years. The poor First Time Buyers need to be able to borrow much more.

Yours,

everybody in Dublin who is thinking of selling

rob316

MayoSalmon wrote: »

Not even 10 years removed from recession and I see this thread pops up. People really and truly deserve what they get in life (personal tragedies aside)

I don't see the problem if it's kept very strict. 10% extra over 20 odd years to someone with a strong ability to repay isn't going to melt the economy.

My point is 30k is a prohibitive figure for a couple to save when they are spending about 16k a year on rent.

100% mortgages didn't cause the last recession, it was the reckless lending criteria that did.

Wildly Boaring

It would all end in developers' pockets.
House prices would shoot up.

Ipso

rob316 wrote: »

I don't see the problem if it's kept very strict. 10% extra over 20 odd years to someone with a strong ability to repay isn't going to melt the economy.

My point is 30k is a prohibitive figure for a couple to save when they are spending about 16k a year on rent.

100% mortgages didn't cause the last recession, it was the reckless lending criteria that did.

But in the past people used to save it, and back then rates were in the double digits.
100% mortgages are a symptom of a bigger problem that needs to be addressed and turning to 100% mortgages just feeds into the vicious cycle.

GingerLily

100% mortgages maybe at loan interest rates, but if you want interest rates based on a secured assest then you need to have actual equity in it and not just market speculation.

AMKC

No. I thought 100% mortgages was a stupid and crazy idea back then and I still do now. Sure borrow 100% of something you will never be able to fully pay back sure great idea not.

Wheeliebin30

How about no I phone, holiday, 4 take always, 2 cars, Orlando every year, kids decked out in the newest gear, laptops, I pads, Netflix, 3 TVs in each house etc etc

Then people wonder why that can’t afford the necessary things.

no.8

rob316 wrote:

I think they should. It's unrealistic expecting young working people to raise 30k for a deposit while paying extortionate rent on the private market.

Ridiculous. This is a windup...IT has to be

VinLieger

rob316 wrote: »

When you have couple's out there who would have the means to pay back 2k a month but can't get mortgages because 1500 of that goes on rent. I don't see why a 100% mortgage would be a problem.

Literally learned nothing

Esse85

What's the bigger challenge of the two for a single first time buyer, is it

a) saving the actual deposit

or

b) the 3.5x your salary

rgace

rob316 wrote: »

With 6.5% interest. Ouch!

At least those banks priced in some of the additional risk they were taking unlike the Irish banks.

Mooooo

Esse85 wrote: »

What's the bigger challenge of the two for a single first time buyer, is it

a) saving the actual deposit

or

b) the 3.5x your salary

The whole idea is people should be able to meet both criteria to prevent becoming overborrowed. The supply of houses is the issue. The correction after a sudden halt was always going to be a fcuked up period.

rob316

Esse85 wrote: »

What's the bigger challenge of the two for a single first time buyer, is it

a) saving the actual deposit

or

b) the 3.5x your salary

For a working couple 3.5x isn't a problem for a say a 275/300k property.

My point was people who can afford to repay a mortgage are trapped in the rental market throwing money down the drain. Renting is such dead ****ing money.

Son of a bitch

No.

no.8

P_1 wrote:

No but we need to start building houses yesterday, this time in places where people want to live. Of course this won't happen till the core FF/FG voters are out of negative equity. Cheers for pulling the rope up there lads

There is a serious crisis of supply but throwing up houses with little or no planning and rattling on about political partys in power today is incredibly (and all too often sadly) the short sighted solution.

We need to re-think our urban and rural spaces and focus on the long term implications, not just destroy the countryside with hastily assembled 3/4 bedroom 2 story houses...Same ol same ol. Dublin, Cork and possibly other cities need to build up. There will be rubbish public transport otherwise.

People are seriously afraid to embrace change. PS. Back in topic. 100% mortgages are a sign of a reckless financial system, of which we were. 10% is a good minimal level

GreeBo

Poor Uncle Tom wrote: »

Expensive money isn't the answer to the housing shortage.

You think mortgages are expensive money?

Its the cheapest way possible to get money. (legally)

ytpe2r5bxkn0c1

Ipso wrote: »

But in the past people used to save it, and back then rates were in the double digits.
100% mortgages are a symptom of a bigger problem that needs to be addressed and turning to 100% mortgages just feeds into the vicious cycle.

It seems to be forgotten that people had to save almost a year's gross earnings as a deposit back in the 70s & 80s. Many also had to pay rent while doing so. And the subsequent interest rate on the mortgage in excess of 13%. But house prices remained relatively stable with building matching demand.

The advent of cheap loans and 100% mortgages led to the debacle we plunged into in 2007/8

lawred2

Wheeliebin30 wrote: »

How about no I phone, holiday, 4 take always, 2 cars, Orlando every year, kids decked out in the newest gear, laptops, I pads, Netflix, 3 TVs in each house etc etc

Then people wonder why that can’t afford the necessary things.

Wtf?

I don't know too many young couples renting with the above lifestyle

You seem to have a gripe with reasonably comfortable people

GreeBo

The *need* for 100% mortgages is a sign of our terrible rent market, nothing more.

How do you save when your rent is more than your mortgage would be for the same house?

no.8

MidMan25 wrote:

It would solve the issue of people being well able to afford a mortgage repayment but not to save the 10% deposit while paying high rent, on the other hand as others said prices will be driven up.

If you can't afford the 10% deposit you can't afford the house. Currently renting as well, it is a pox for what you get but saving for a deposit is also a massive lesson in discipline and determination through saving.

[Deleted User]

rob316 wrote: »

For a working couple 3.5x isn't a problem for a say a 275/300k property.

My point was people who can afford to repay a mortgage are trapped in the rental market throwing money down the drain. Renting is such dead ****ing money.

you might as well say buying groceries is dead money if you dont end up owning the shop