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Need home ASAP, have 170000 cash

24

Comments

  • #32
    cgcsb
    Registered Users Posts: 9,262 ✭✭✭cgcsb


    You can buy a spacious 2 bed in Ballymun for €150,000. They rent for about €1,800 per month


  • #33
    .......
    Closed Accounts Posts: 9,057 ✭✭✭.......


    It would be madness to use your entire 170k savings to buy a property to rent out - the main one being that the return on investment would be terrible when you look at how highly rental income is taxed (with no mortgage to write mortgage interest off against tax) plus the costs of maintenance.

    Why would you not take that money and buy a property for yourself and your kids to live in outright somewhere in the country that is affordable and then live rent and mortgage free.

    I mean, South Dublin - thats a ridiculous place for someone to insist on staying in when they have no income?

    How are you currently paying rent?


  • #34
    ImARebel
    Registered Users Posts: 793 ✭✭✭ImARebel


    look at laois, train straight to dublin if needed, houses in some towns going for buttons and you'd still have a good chunk left over


  • #35
    woodchuck
    Moderators, Society & Culture Moderators Posts: 15,409 Mod ✭✭✭✭woodchuck


    As other people have suggested, you'd be better off using your money to buy a house in another part of the country. You're in a very lucky position to be able to afford to do this and not be limited by location (as so many people are for work).

    The only issue will be moving your kids to a new school and a new area. Obviously this will be a bit of an upheaval for them, but it's only temporary and they'll adjust to the change.


  • #36
    realitykeeper
    Registered Users Posts: 4,138 ✭✭✭realitykeeper


    My advise would be to buy gold, rent and wait.


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  • #37
    heretothere
    Registered Users Posts: 614 ✭✭✭heretothere


    I agree with the others, why are you staying in south Dublin if you have no ties to the area. You could get a lovely house else where in the country:

    https://www.daft.ie/sligo/houses-for-sale/collooney/18-abhainn-mor-collooney-sligo-2052199/
    https://www.daft.ie/cavan/houses-for-sale/cavan/9-cluain-aoibhinn-cavan-cavan-2030537/

    Rural doesn't necessarily mean under a rock somewhere in the countryside! There's Waterford/ Limerick, not a whole lot in Cork/ Galway for your budget. Also there are loads of big towns across the country.

    If you are getting rental income, it will affect your social welfare and it seems like a very hard route to go down. It's hard to get good tenants.


  • #38
    JDD
    Registered Users Posts: 1,578 ✭✭✭JDD


    I am assuming the OP has good reasons for not wanting to move from where he currently lives (maybe where he is living is reasonable, rent-wise. Maybe he has good reasons for not wanting to move the kids to another location). Bearing that in mind...

    Yes, as a cash buyer it is much easier to set yourself up as a company and have the company buy the apartment/house. You can't do it if you need a mortgage, as a bank won't lend to a company with no trading history. I'm not sure on the legals, but the company will still have to pay tax on any profits (rent) earned. You will have to pay tax on any remaining profits drawn down as dividend. That makes it sound like you're paying tax twice, and indeed you are, but any maintenance to the property (and probably a portion of other costs) should be deductible before profit, so you might be better off doing it through the company. You'll need an accountant to advise you on this though. Setting up as a company is easy enough and not expensive. It'd cost a couple of hundred quid.

    The other advance would be that you would keep your eligibility for the help-to-buy scheme (I think! Again, get an accountant to confirm!) as a first time buyer. That's the only advantage to being a first time buyer nowadays, there's no exemptions to stamp duty.

    If you're relying on any sort of means tested social welfare payment, the profits drawn down may have an effect on how much you can get. Whether it's a viable option will all depend on how much of your day-to-day costs you can write off against the rental profits.

    Good luck and I hope things work out for you.


  • #39
    shenanagans
    Registered Users Posts: 896 ✭✭✭shenanagans


    If you buy at auction then you get a closing date which is binding usually about 6 weeks post auction but if you've sitting tenants to very risky....could take very long time to get them out.

    Agree with other posters....look at moving out of Dublin and buy a family home for yourself. You'll pay tax on a rental income and end up with no home for yourself...


  • #40
    bilbot79
    Registered Users Posts: 1,980 ✭✭✭bilbot79


    amcalester wrote: »
    You need to get a job and then apply for a mortgage.

    Erm..no. He can do whatever he sees fit with his 170k


  • #41
    AndrewJRenko
    Registered Users Posts: 28,304 ✭✭✭✭AndrewJRenko


    realitykeeper wrote: »
    My advise would be to buy gold, rent and wait.
    Again, putting all your investment in any one category of asset, whether gold or residential property or whatever is very risky.

    OP needs to diversify his investments to reduce risk.


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  • #42
    dvdman1
    Registered Users Posts: 512 ✭✭✭dvdman1


    AndrewJRenko wrote: »
    Again, putting all your investment in any one category of asset, whether gold or residential property or whatever is very risky.

    OP needs to diversify his investments to reduce risk.

    No suggestions here... just fancy bidness talk, the chap isn't looking for investment hes looking for a place to live.

    The guy clearly doesn't need to live in the capital, theres plenty of property for 150k mark around the country near other urban centres.


  • #43
    realitykeeper
    Registered Users Posts: 4,138 ✭✭✭realitykeeper


    AndrewJRenko wrote: »
    Again, putting all your investment in any one category of asset, whether gold or residential property or whatever is very risky.

    OP needs to diversify his investments to reduce risk.

    You can reduce the risk by knowing what you are doing.


  • #44
    AlmightyCushion
    Moderators, Education Moderators, Technology & Internet Moderators Posts: 35,041 Mod ✭✭✭✭AlmightyCushion


    realitykeeper wrote: »
    You can reduce the risk by knowing what you are doing.

    How do you know that you know what you are doing as opposed to just thinking you know what you are doing?

    MrWyatt - For the love of God do not invest in an investment property or Gold or anything else like that. You are trying to put a roof over your head. Doing either of those things won't help with that, are unnecessarily risky and probably will affect your welfare payments. Your best bet is to use the money you have to buy a place for cash. It will require moving though which might be tough but might be the best thing long term for you and your family.


  • #45
    .......
    Closed Accounts Posts: 9,057 ✭✭✭.......


    realitykeeper wrote: »
    You can reduce the risk by knowing what you are doing.

    Which clearly the OP doesnt.


  • #46
    amcalester
    Closed Accounts Posts: 4,121 ✭✭✭amcalester


    bilbot79 wrote: »
    Erm..no. He can do whatever he sees fit with his 170k

    Of course he can. He can invest in chocolate teapots for all anyone cares, but if he wants to buy a home for this kids in South Dublin then that's what he needs to do.

    If the OP can't work then he needs to re-evaluate and distinguish his wants from his needs and prioritize the later over the former.


  • #47
    Franz Von Peppercorn
    Closed Accounts Posts: 7,070 ✭✭✭Franz Von Peppercorn


    Squatter wrote: »
    Means Test isn't applied for PRSI-related Benefits. They are paid out on the basis of PRSI contributions, irrespective of means.

    For 6 months. Used to be 9.


  • #48
    MrWyatt
    Registered Users Posts: 22 ✭MrWyatt


    JDD wrote: »
    I am assuming the OP has good reasons for not wanting to move from where he currently lives (maybe where he is living is reasonable, rent-wise. Maybe he has good reasons for not wanting to move the kids to another location). Bearing that in mind...

    Yes, as a cash buyer it is much easier to set yourself up as a company and have the company buy the apartment/house. You can't do it if you need a mortgage, as a bank won't lend to a company with no trading history. I'm not sure on the legals, but the company will still have to pay tax on any profits (rent) earned. You will have to pay tax on any remaining profits drawn down as dividend. That makes it sound like you're paying tax twice, and indeed you are, but any maintenance to the property (and probably a portion of other costs) should be deductible before profit, so you might be better off doing it through the company. You'll need an accountant to advise you on this though. Setting up as a company is easy enough and not expensive. It'd cost a couple of hundred quid.

    The other advance would be that you would keep your eligibility for the help-to-buy scheme (I think! Again, get an accountant to confirm!) as a first time buyer. That's the only advantage to being a first time buyer nowadays, there's no exemptions to stamp duty.

    If you're relying on any sort of means tested social welfare payment, the profits drawn down may have an effect on how much you can get. Whether it's a viable option will all depend on how much of your day-to-day costs you can write off against the rental profits.

    Good luck and I hope things work out for you.
    Thank you for your understanding and informative post! I need to talk to an accountant to see how I could make it profitable. To leverage my money I would also consider a property that needs work and doing most of the work myself. I have done up a house before on a very small budget with great success. I am worried about a costly court case to evict non paying tenants though.


  • #49
    JDD
    Registered Users Posts: 1,578 ✭✭✭JDD


    Thank you for your understanding and informative post! I need to talk to an accountant to see how I could make it profitable. To leverage my money I would also consider a property that needs work and doing most of the work myself. I have done up a house before on a very small budget with great success. I am worried about a costly court case to evict non paying tenants though.

    The only thing I'd say about that is be careful. If 170,000 is the entirety of your savings I presume you want some sort of liquidity - i.e. if you hit harder times you'll be able to sell the property at relatively short notice. If the economy downturns, and you are left with the property that is not livable in when you need to sell it, a large chunk of your potential buyers will be prevented from buying it as banks are notoriously loathe to lend for do-er uppers in a downturn. You might be lucky and find a willing cash buyer, but they'll have you over a barrel and they'll know it. You'll lose a good chunk of your savings.

    Of course if you have some kind of safety net - maybe you're living with your parents, they'd be able to help you out in an emergency or something - and you're happy to have the property for the long term. If that's the case then yeah, go for the do-er upper. Remember the property will be earning you nothing while you are doing it up, so factor that into your costs.


  • #50
    JimmyMW
    Registered Users Posts: 695 ✭✭✭JimmyMW


    MrWyatt wrote: »
    Thank you for your understanding and informative post! I need to talk to an accountant to see how I could make it profitable. To leverage my money I would also consider a property that needs work and doing most of the work myself. I have done up a house before on a very small budget with great success. I am worried about a costly court case to evict non paying tenants though.

    What health issues could you have that prevents you getting a job but not doing most of the work yourself on a renovation project?


  • #51
    MrWyatt
    Registered Users Posts: 22 ✭MrWyatt


    JDD wrote: »
    The only thing I'd say about that is be careful. If 170,000 is the entirety of your savings I presume you want some sort of liquidity - i.e. if you hit harder times you'll be able to sell the property at relatively short notice. If the economy downturns, and you are left with the property that is not livable in when you need to sell it, a large chunk of your potential buyers will be prevented from buying it as banks are notoriously loathe to lend for do-er uppers in a downturn. You might be lucky and find a willing cash buyer, but they'll have you over a barrel and they'll know it. You'll lose a good chunk of your savings.

    Of course if you have some kind of safety net - maybe you're living with your parents, they'd be able to help you out in an emergency or something - and you're happy to have the property for the long term. If that's the case then yeah, go for the do-er upper. Remember the property will be earning you nothing while you are doing it up, so factor that into your costs.

    Great advice, I'll make sure to be ready to sell quickly at the slightest whiff of downturn. I guess that also means getting tenants out so I can sell. I'm not so worried about it not earning me anything while it's empty as I don't have a mortgage to pay back. Also money sitting in the bank doesn't earn me anything either as interest rates are so low.


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  • #52
    JDD
    Registered Users Posts: 1,578 ✭✭✭JDD


    JimmyMW wrote: »
    What health issues could you have that prevents you getting a job but not doing most of the work yourself on a renovation project?

    You know, at no point has the guy said that he draws any kind of social welfare payment.

    Also, there are a lot more health issues than just physical ones. It could be a mental health issue.


  • #53
    Simple_Simone
    Closed Accounts Posts: 152 ✭✭Simple_Simone


    Franz Von Peppercorn wrote: »
    For 6 months. Used to be 9.

    Really? So my parents' State contributory old age pensions will stop after 6 months? Will you tell them or will I?


  • #54
    .......
    Closed Accounts Posts: 9,057 ✭✭✭.......


    JDD wrote: »
    You know, at no point has the guy said that he draws any kind of social welfare payment.

    Also, there are a lot more health issues than just physical ones. It could be a mental health issue.

    Nor did the poster say that he had said that.

    I am interested too - what health issues prevent you from working but not from working on a renovation project?

    I noticed somewhere that you said you couldnt work as you had 2 kids and no help, but this is the case for thousands of working parents in the country. Its not a reason not to work.

    If you are unemployed, how are you currently putting a roof over yourself and your kids heads and feeding them?


  • #55
    JDD
    Registered Users Posts: 1,578 ✭✭✭JDD


    ....... wrote: »
    Nor did the poster say that he had said that.

    I am interested too - what health issues prevent you from working but not from working on a renovation project?

    I noticed somewhere that you said you couldnt work as you had 2 kids and no help, but this is the case for thousands of working parents in the country. Its not a reason not to work.

    If you are unemployed, how are you currently putting a roof over yourself and your kids heads and feeding them?

    I know they didn't, but there is a tinge of "are taxpayers subsidizing you while you're choosing not to work" to the replies to the initial post.

    There isn't that many single parents working with two young kids and no grandparents or family members to do the childminding. Full time after school care for two kids would mean that you would need to earn around €30k before tax just to cover the childminding costs, never mind what you would need to earn on top of that to live. You can see why it might not be a viable option.

    There's a big difference between working 9-5 in an office or a shop, and setting your own hours working on your own project. For someone with say, acute social anxiety, the former may be impossible but the latter possible. I'm not saying that's what the OP has (and I don't think he should be under any obligation to tell us), but you have to open your mind as to what health issues might mean.

    But here, I'm just surmising. I've no idea what the OPs deal is.


  • #56
    JimmyMW
    Registered Users Posts: 695 ✭✭✭JimmyMW


    JDD wrote: »
    You know, at no point has the guy said that he draws any kind of social welfare payment.

    Also, there are a lot more health issues than just physical ones. It could be a mental health issue.

    I am aware of what has been posted, I never mentioned anything about social welfare payments, you raised that. As you have raised it, it would be good for the OP to clarify their situation in this regard as it has been already asked on several occasions by other posters in many different ways, however the OP has yet to respond.

    Whilst both physical and mental health issues may prevent someone from working, I am curious what health issue (physical or mental) prevents someone from working but does not prevent them from doing most of the work on a renovation project. The OP stated that getting a job was not an option for health reasons.


  • #57
    AndrewJRenko
    Registered Users Posts: 28,304 ✭✭✭✭AndrewJRenko


    realitykeeper wrote: »
    AndrewJRenko wrote: »
    Again, putting all your investment in any one category of asset, whether gold or residential property or whatever is very risky.

    OP needs to diversify his investments to reduce risk.

    You can reduce the risk by knowing what you are doing.
    Unless you have a crystal ball that can see into the future, you really don't know what you're doing. Suggesting gold as an appropriate investment for this scenario would suggest that you don't know what you're doing.


  • #58
    MrWyatt
    Registered Users Posts: 22 ✭MrWyatt


    I am not on social welfare. I also don't feel the need to justify why I am making the choices that I am making. I am merely asking for practical advice on how to best invest my money to afford a home in the right location for my family. It took a lot of sacrifice to save this money and I'm willing to work hard within my current situation to get us a home, there is really no need to take this personally. And as far as there being lots of parents in Dublin who make things work, well, that's not really true is it. Single parents in Ireland hardly have it easy. There wouldn't be thousands of homeless families if that wasn't the case. Not that I am comparing myself to homeless families - I am well aware that I am lucky to have this money- and that is exactly why I want to make the best decision and why I am looking for opinions on how to best leverage this money. Still in not enough to buy a house outright in any location that we could live in and I have been refused a mortgage.


  • #59
    .......
    Closed Accounts Posts: 9,057 ✭✭✭.......


    JDD wrote: »
    There isn't that many single parents working with two young kids and no grandparents or family members to do the childminding. Full time after school care for two kids would mean that you would need to earn around €30k before tax just to cover the childminding costs, never mind what you would need to earn on top of that to live. You can see why it might not be a viable option.

    I cant agree with this - plenty of single parents work.

    Based on what has been posted its impossible to tell what is a viable option and what isnt but the OP seems to just want responses telling him he should spend all his savings on a house so more info might not be forthcoming.

    I am curious how someone could have saved 170k and have 2 young kids etc... I (perhaps mistakenly) assumed that he must have been a decent earner to have that level of savings at a young age.


  • #60
    .......
    Closed Accounts Posts: 9,057 ✭✭✭.......


    MrWyatt wrote: »
    ...in any location that we could live in.

    Why cant you live in other locations?


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  • #61
    AndrewJRenko
    Registered Users Posts: 28,304 ✭✭✭✭AndrewJRenko


    dvdman1 wrote: »
    AndrewJRenko wrote: »
    Again, putting all your investment in any one category of asset, whether gold or residential property or whatever is very risky.

    OP needs to diversify his investments to reduce risk.

    No suggestions here... just fancy bidness talk, the chap isn't looking for investment hes looking for a place to live.

    The guy clearly doesn't need to live in the capital, theres plenty of property for 150k mark around the country near other urban centres.
    He's seriously considering putting his entire savings into a residential property investment in a boomy market. He's never operated an investment property before.


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