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Irish Property Market 2020 Part 2

Graham

Continued from here:

https://www.boards.ie/vbulletin/showthread.php?t=2058041687

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cnocbui

Reins wrote: »

https://www.independent.ie/news/central-bank-wont-bow-to-pressure-to-alter-mortgage-limits-39794682.html

If the government thinks the rules are not fair, then they should grow a pair and change them.

brisan

cnocbui wrote: »

If the government thinks the rules are not fair, then they should grow a pair and change them.

That's what got us where we ended up in 08
If the 3.5 times salary cap was relaxed house prices would rise to meet it

random_banter

The LTV restrictions are what's tough for us, and where exemptions seem to make sense. I was saving to have a minimum of 10-12% for my deposit as a FTB, but since then I decided to buy with my partner - who has taken out a mortgage before so then we then needed to come up with 20% deposit.

We're each contributing to the deposit equally so for him to come up with his half isn't as hard as for me (he's got some equity). Meanwhile for me it's literally trying to double my original deposit target. And when that's for a deposit on a home in South Dublin, it's not an insignificant deposit.

In times like that, an exemption on LTV can really help. We're looking to get one and put 15% down, which is more achievable without waiting another number of years. We're already in our mid-30s so really want to get a move on.

We're nowhere near clearing the 3.5x earning limit, more like looking to borrow 2.9x.

Would you consider that risky lending on behalf of the bank or foolish on behalf of us, the borrower?

[Deleted User]

If you are contributing equally to the deposit of 20% surely you still only have to save 10% yourself?

brisan

bubblypop wrote: »

If you are contributing equally to the deposit of 20% surely you still only have to save 10% yourself?

Unless they are now going for a house twice as expensive as originally planned by the OP on their own

Villa05

fliball123 wrote:

Listen I wouldnt let the public sector or semi state do what your suggesting. It would cost way to much for something like what you are looking for to be created. In the past the equation of public sector + A chance to get some gravy from the gravy train = disaster for the tax payer and usually the tax payer has no choice but to pay. Sorry but this is how it has always been cant see it changing as its in our DNA

What I'm hearing on these boards about what is currently happening in sourcing social housing is the Formula 1 gravy train.

I can understand why people will defend it or not call it out for what it is.
There are people out there making a fortune out of this at the expense of the taxpayer. I'm sure those people don't want it to end. 20 year leases must sound like the gates of heaven opening in front of them

fliball123

Villa05 wrote: »

What I'm hearing on these boards about what is currently happening in sourcing social housing is the Formula 1 gravy train.

I can understand why people will defend it or not call it out for what it is.
There are people out there making a fortune out of this at the expense of the taxpayer. I'm sure those people don't want it to end. 20 year leases must sound like the gates of heaven opening in front of them

Well at least we wont be on the hook for 20/30 year pension that has to be services by the tax payer. I dont know what the answer is but its not giving it to the public service. How many billion a year do we pay for PS pay and pensions currently ?? and you want a new entity created to manage this.. Thanks but no thanks

IamMe33

Qwerty2018 wrote: »

Going to hold off until next year to start applying for my mortgage.
Would need a mortgage exemption as I am looking to purchase a house for around 250,000.
I am a single teacher currently on 45,000 per year with a deposit saved of 50,000.
Was told here before that I had little chance with the current situation. Would this be anymore likely next year?

According to this advice from Bonkers.ie

https://www.bonkers.ie/guides/mortgage/what-are-the-central-banks-lending-rules/#:~:text=For%20second%2Dtime%20and%20subsequent,lent%20out%20in%20come%20cases.

Whether you get an exemption will depend on your credit worthiness, the quality of your mortgage application and whether the lender still has room to give out an exemption.

Exemptions are often all used up by the middle of the calendar year, so if you want to apply for one, the earlier in the year that you apply for your mortgage the better.

Banks also tend to give exemptions to people on higher incomes, which means around €50,000 or above for a single applicant and €75,000 and above for a joint application.

It makes sense that banks would select for higher earners as that would increase their profit on a larger mortgage.
On paper, with the info you've given, your case would be borderline and depend on the quality of your opposition really.

I've heard others here quote that 4.5 times your gross salary is generally the maximum extent of an exemption.
If you were to be granted an exemption your mortgage limit would be:
4.5 x €45,000 = €202,000

Adding your saved deposit would bring this to €252,000, which would just bring you over the line of your target.
You would have to save another couple of grand to cover associated solicitor fees and stamp duty.

According to Central Bank guidelines as a first time buyer the maximum percentage of exemptions they can lend come under two cases: LTV and LTI (in bold below from the Central Bank's website)
I'm assuming you're a FTB.

https://www.centralbank.ie/consumer-hub/explainers/what-are-the-mortgage-measures

Loan-to-Income limits
The LTI limit restricts the amount of money you can borrow to a maximum of 3.5 times your gross income. So for example, a couple with a combined income of €100,000 you can borrow up to a maximum of €350,000.

Once again banks and other lenders have the freedom to lend a certain amount above these limits. In any one calendar year they can give an allowance to:

Up to 20% of the value of mortgages to first-time buyers
Up to 10% of the value of mortgages to second and subsequent buyers
Ireland is not alone in introducing these kinds of mortgage measures. Many other EU countries have introduced some form of mortgage regulation to help safeguard their national financial systems.

Getting your application in as early next year as possible would be your best bet to be one of those 20%.

Ush1

woejus wrote: »

Is this really your understanding of what makes areas such as Foxrock appealing? That other people have paid "a lot" to own a house there?

Seems more like bitterness to me.

Privacy, quiet, space, proximity to city centre... these are the differentiators that drive properties price variances.

That and no howyehs roaming the streets.

I'm not bitter at all, to each their own. It's not close to the city centre or coast and there's nothing IMO particularly attractive about the place. Even Dundrum has the town centre and a nice village.

random_banter

brisan wrote: »

Unless they are now going for a house twice as expensive as originally planned by the OP on their own

Sorry, yes, should have clarified that. I was planning to buy a smaller place suitable for a single person when I was on my own, maybe small two bed home. Sell it when the time came to upgrade. As an example, maybe it was going to be a 300k property. Now our needs are different, we've decided to go for a bigger family home, that hopefully we wouldn't need to leave. - room to expand, enough room to get stuck in during a major recession and if neg eq. hits, etc). So you'd be looking at something that could be twice the price.

It's not great to be a buyer in the area at the mo, very low supply all year, houses in walk-in nick are subject to bidding wars. I've been tracking selling prices in south dublin versus asking as they come up on the PPP. It's a 50/50 split on sales since March with some going up to 7% over asking and some 7% under asking. Generally it's the ones which need very little work that are going for over asking.

Viewing one today again. Wish us luck?

[Deleted User]

Has anyone experience with exemptions?

Much likelihood of a single person on 65k with approx 50k deposit getting a slight exemption on the 3.5 times mortgage?

With no other major outgoings

Ursabear

I am in the exact same situation as you!! One frustrating thing is that my partner purchased an apt with his ex before the last crash which they have since sold. Even though he didn't avail of the FTB grant that time neither of us will qualify for it now. Good luck today &#55358;&#56606; We have decided to wait until next year. Any extra savings we will have from waiting will simply go to helping our shortened mortgage term as we are getting older, not to buy somewhere more expensive.

random_banter

AdamD wrote: »

Has anyone experience with exemptions?

Much likelihood of a single person on 65k with approx 50k deposit getting a slight exemption on the 3.5 times mortgage?

With no other major outgoings

I know someone similar to you who got one. To x4 times salary. It was in 2019, but it's possible. Through a broker with Ulster Bank.

FYI I was going to say it myself but application and exemption questions/ discussion are more suited to the Saving/Applying for A Mortgage Thread on here, which is great and very active. You might get better answers there. This one is more about the market conditions.

PropQueries

The state has entered into an agreement to convert student accommodation units into a direct provision centre for 350 people in Letterkenny.

There are over 60,000 holiday homes in Ireland. Why doesn't the state CPO a percentage of these (ones located near towns or villages with services in place) instead of exasperating an apparent existing housing problem in towns and cities?

Given that many people thought that they should have the right to use their residential properties for AirBnB etc., couldn't the argument be made that holiday home owners should then be allowed to convert their units from holiday homes into residential use?

Link to article on Highland Radio here: https://www.highlandradio.com/2020/11/26/exclusive-direct-provision-centre-to-be-established-in-letterkenny/

fliball123

PropQueries wrote: »

The state has entered into an agreement to convert student accommodation units into a direct provision centre for 350 people in Letterkenny.

There are over 60,000 holiday homes in Ireland. Why doesn't the state CPO a percentage of these (ones located near towns or villages with services in place) instead of exasperating an apparent existing housing problem in towns and cities?

Given that many people thought that they should have the right to use their residential properties for AirBnB etc., couldn't the argument be made that holiday home owners should then be allowed to convert their units from holiday homes into residential use?

Link to article on Highland Radio here: https://www.highlandradio.com/2020/11/26/exclusive-direct-provision-centre-to-be-established-in-letterkenny/

So if your not doing your wife can we CPO her for lads who are not having sex? All for the greater good right ? Also have you not been banging on here saying there is no housing crisis it was made up like Santa Clause

PropQueries

fliball123 wrote: »

So if your not doing your wife can we CPO her for lads who are not having sex? All for the greater good right ?

Well, if they can CPO land for Greenways, I think they can CPO land for housing. Plus I said "apparent existing housing problem".

awec

PropQueries wrote: »

The state has entered into an agreement to convert student accommodation units into a direct provision centre for 350 people in Letterkenny.

There are over 60,000 holiday homes in Ireland. Why doesn't the state CPO a percentage of these (ones located near towns or villages with services in place) instead of exasperating an apparent existing housing problem in towns and cities?

Given that many people thought that they should have the right to use their residential properties for AirBnB etc., couldn't the argument be made that holiday home owners should then be allowed to convert their units from holiday homes into residential use?

Link to article on Highland Radio here: https://www.highlandradio.com/2020/11/26/exclusive-direct-provision-centre-to-be-established-in-letterkenny/

The state cannot just CPO whatever it wants.

fliball123

PropQueries wrote: »

Well, if they can CPO land for Greenways, I think they can CPO land for housing.

Your looking to CPO someones private property

TheSheriff

PropQueries wrote: »

The state has entered into an agreement to convert student accommodation units into a direct provision centre for 350 people in Letterkenny.

There are over 60,000 holiday homes in Ireland. Why doesn't the state CPO a percentage of these (ones located near towns or villages with services in place) instead of exasperating an apparent existing housing problem in towns and cities?

Given that many people thought that they should have the right to use their residential properties for AirBnB etc., couldn't the argument be made that holiday home owners should then be allowed to convert their units from holiday homes into residential use?

Link to article on Highland Radio here: https://www.highlandradio.com/2020/11/26/exclusive-direct-provision-centre-to-be-established-in-letterkenny/

For months now you have extolled your theory that there is no housing crisis: it doesn't exist.

So this should be a non issue......

fliball123

TheSheriff wrote: »

For months now you have extolled your theory that there is no housing crisis: it doesn't exist.

So this should be a non issue......

Props thinks we all have the memory of a gold fish

cnocbui

fliball123 wrote: »

Your looking to CPO someones private property

Of course, this is a socialist country, after all. Owning property is an interesting concept here, I'd hardly call it 'private' property. It's really property you hold so that the 'public' can tell you what yo can and can't do with it. Transfering the title to the public is just formalising the situation.

PropQueries

TheSheriff wrote: »

For months now you have extolled your theory that there is no housing crisis: it doesn't exist.

So this should be a non issue......

Well this action by the department kind of shows there's obviously no housing problem in Letterkenny anyway. If anything, the Letterkenny agreement shows there's apparently no housing problem in Co. Donegal, so that's some good news anyway.

In relation to CPOs, they go out of their way to CPO land and property for greenways, bus routes etc. and the recent Intel/farmer high court action is a more recent high profile example where they attempt to CPO land for any purpose they see fit.

TheSheriff

PropQueries wrote: »

Well this action by the department kind of shows there's obviously no housing problem in Letterkenny anyway. If anything, the Letterkenny agreement shows there's apparently no housing problem in Co. Donegal, so that's some good news anyway.

In relation to CPOs, they go out of their way to CPO land and property for greenways, bus routes etc. and the recent Intel/farmer high court action is a more recent high profile example where they attempt to CPO land for any purpose they see fit.

Absolute nonsense.

You now have two posts on the same page, one saying there is no housing crisis, the other saying there is.

And that somehow letterkenny is representative of the housing issue on a national level.

Total nonsense.

PropQueries

TheSheriff wrote: »

Absolute nonsense.

You now have two posts on the same page, one saying there is no housing crisis, the other saying there is.

And that somehow letterkenny is representative of the housing issue on a national level.

Total nonsense.

Never equated Donegal to the national level.

PropQueries

Looks like Blackstone has ceded control of the Blanchardstown Shopping Centre to Goldman Sachs. It's interesting as it shows that the vulture funds will exit (and very very very quickly) the moment they don't see any further gains to be made in the Irish market. And, remember, between them, they purchased c. €200 Billion of business and property loans from Irish banks and NAMA between 2012 and 2016...

Link to article in Irish Independent here: https://www.independent.ie/business/commercial-property/goldman-sachs-moves-to-take-over-blanchardstown-39761392.html

And in other news, a receiver has been appointed over two high-profile office buildings in Dublin including Donnybrook House which is a fairly new six-storey office block in Donnybrook.

The story is in The Times here: https://www.thetimes.co.uk/article/receiver-appointed-for-u-i-and-colony-capitals-dublin-office-blocks-bj0tndr09

Pelezico

PropQueries wrote: »

Looks like Blackstone has ceded control of the Blanchardstown Shopping Centre to Goldman Sachs. It's interesting as it shows that the vulture funds will exit (and very very very quickly) the moment they don't see any further gains to be made in the Irish market. And, remember, between them, they purchased c. €200 Billion of business and property loans from Irish banks and NAMA between 2012 and 2016...

Link to article in Irish Independent here: https://www.independent.ie/business/commercial-property/goldman-sachs-moves-to-take-over-blanchardstown-39761392.html

And in other news, a receiver has been appointed over two high-profile office buildings in Dublin including Donnybrook House which is a fairly new six-storey office block in Donnybrook.

The story is in The Times here: https://www.thetimes.co.uk/article/receiver-appointed-for-u-i-and-colony-capitals-dublin-office-blocks-bj0tndr09

Retail is a completely different sector to the housing market. It is suffering in UK, USA and Ireland.

There is little correlation between this and the health if the housing market. People are buying online.

PropQueries

Pelezico wrote: »

Retail is a completely different sector to the housing market. It is suffering in UK, USA and Ireland.

There is little correlation between this and the health if the housing market. People are buying online.

So the retail and office property market is in trouble but not residential. That makes sense as there’s no correlation between these three property sectors.

Remember, while the UK is leaving the EU, we’re not, so it won’t be long before those employees who were working in those office spaces (now in trouble but no correlation as you say) are shipped off to the other side of the EU. OECD global tax reforms, digital taxes and the CCCTB may expedite this process IMO.

As you know, that benefit to being in the EU i.e. freedom of movement, freedom to set-up or move your business to anywhere in the EU and still being able to sell your services throughout the EU etc. works both ways. May come back to haunt us IMO.

Pelezico

PropQueries wrote: »

So the retail and office property market is in trouble but not residential. That makes sense as there’s no correlation between these three property sectors.

Remember, while the UK is leaving the EU, we’re not, so it won’t be long before those employees who were working in those office spaces (now in trouble but no correlation as you say) are shipped off to the other side of the EU. OECD global tax reforms, digital taxes and the CCCTB may expedite this process IMO.

As you know, that benefit to being in the EU i.e. freedom of movement, freedom to set-up or move your business to anywhere in the EU and still being able to sell your services throughout the EU etc. works both ways. May come back to haunt us IMO.

The retail sector has been struggling for years as people shop online. Employment is moving to areas of growth like amazon.

fliball123

PropQueries wrote: »

So the retail and office property market is in trouble but not residential. That makes sense as there’s no correlation between these three property sectors.

Remember, while the UK is leaving the EU, we’re not, so it won’t be long before those employees who were working in those office spaces (now in trouble but no correlation as you say) are shipped off to the other side of the EU. OECD global tax reforms, digital taxes and the CCCTB may expedite this process IMO.

As you know, that benefit to being in the EU i.e. freedom of movement, freedom to set-up or move your business to anywhere in the EU and still being able to sell your services throughout the EU etc. works both ways. May come back to haunt us IMO.

I gave you links to who will be getting jobs when Brexit is done with Dublin being the right up there, you retorted and scoffed that the links were from 2016/17 etc so I gave you another 4 from October this year... Keep spinning there with the freedom of movement in the EU because funnily enough up until this year (which is an anomaly due to covid no one has been coming in or going in big numbers) we were getting more people coming to Ireland than leaving which I also proved to you via OCED stats. Ireland's most senior politicans have gone on record time and again to stat that the corpo tax will not be touched unless you have proof the contrary. Every country in the EU have control over their own taxes and the EU cannot impose a personal tax on any country who dont want it.

PropQueries

fliball123 wrote: »

I gave you links to who will be getting jobs when Brexit is done with Dublin being the right up there, you retorted and scoffed that the links were from 2016/17 etc so I gave you another 4 from October this year... Keep spinning there with the freedom of movement in the EU because funnily enough up until this year (which is an anomaly due to covid no one has been coming in or going in big numbers) we were getting more people coming to Ireland than leaving which I also proved to you via OCED stats. Ireland's most senior politicans have gone on record time and again to stat that the corpo tax will not be touched unless you have proof the contrary. Every country in the EU have control over their own taxes and the EU cannot impose a personal tax on any country who dont want it.

That’s the problem. When the new OECD global tax reform are approved and implemented our low corporation tax becomes effectively meaningless unfortunately.