Is The Property Market Unfair to First Time Buyers?

mariaalice · 30-10-2020 9:39am

The bit of sacrifice thing is mostly nonsense though not always because people do have different attitudes to money and lifestyle.

There is a difference between saying they can't afford a property anywhere in Dublin or the surrounding areas verse they want a house ( not an apartment ) in a particular area in Dublin or any major city and they can't afford that.

Idbatterim · 30-10-2020 10:29am

All pf this cant afford dublin, so move .. We can afford for hundreds of thousands in dublin to be living in an expensive asset for free, paid for by those that will never benefit from it. New luxury apartments being given away for free, like we are an oil rich state that doesnt have appalling transport, health, infrastructure, class sizes, justice system etc

" cant afford dublin, move " while all the wasters live here for free , many in prime areas? Dcc relentlessly blocking buildings higher than 6/7 floors in the docklands, actually going to court to block this! Oh yeah, lack of space in dublin like its hong kong is the issue!

Wanderer78 · 30-10-2020 10:35am

Vieira82 wrote: »

It's the joys of the free market? As some have pointed out. Councils should be building homes directly not buying from developers. This situation is absolutely ridiculous and a money sink for councils!

Obviously it would be way cheaper to:
- Hire people to build an apartment block
- Build it at the cost of the building materials

Instead we have this absurd situation! I know from a close person that developers try everything to scam local councils. Local council employees have to have a huge degree of cold blood and attention as if there's a gap to be exploited the developers will. I know for a fact some even coercively show up in council offices to try and "persuade" council employees of what they want. Some shove them away, others don't...

Another thing that needs to end too is the way council houses are awarded. I know also of people thay got awarded a house and some refuse! "oh i don't like it, I don't like the location"

Simply put if you're on the housing list and you're offered a place, if you refuse it then you're out of the housing list. Unless of course it's a completely unfit for purpose house, but by the article above we can see that's not the case...

theres no such thing as a free market anywhere on this planet, all markets have rules and regulations, and interactions with state bodies, all markets require this, in order to function. its also important to realise, the so called founder of free market economics, adam smith, had a completely different view of what we now call free markets, he meant a market free from rent, our version of the so called free market is exactly the opposite of this, i.e. 'rent seeking behaviour'

30-10-2020 10:43am

Heres Johnny wrote: »

........................ we are fairly representative of what's going on around the country...........................

Sales/project managers/area managers/department managers/General manager x 8 are on between 50k and 80k plus car plus expenses. These people can buy houses wherever they want in the country and contribute to pension maybe buy an investment property and are pretty comfortable. Generally aged between late 30s and mid 50s in this bracket but 1 lady is early 30s and has just bought a house in Nice area of Dublin..................................

Strange post.
Most of the workforce are deskbound so the "plus car" isn't applicable.

You aren't buying anything nice in Dublin on 80k/annum, as a single applicant unless you have equity or a huge deposit.

Vieira82 · 30-10-2020 10:44am

Wanderer78 wrote: »

theres no such thing as a free market anywhere on this planet, all markets have rules and regulations, and interactions with state bodies, all markets require this, in order to function. its also important to realise, the so called founder of free market economics, adam smith, had a completely different view of what we now call free markets, he meant a market free from rent, our version of the so called free market is exactly the opposite of this, i.e. 'rent seeking behaviour'

problem is when those regulations benefit profit more than actual a functioning economy and social structure...

mariaalice · 30-10-2020 10:58am

Idbatterim wrote: »

All pf this cant afford dublin, so move .. We can afford for hundreds of thousands in dublin to be living in an expensive asset for free, paid for by those that will never benefit from it. New luxury apartments being given away for free, like we are an oil rich state that doesnt have appalling transport, health, infrastructure, class sizes, justice system etc

" cant afford dublin, move " while all the wasters live here for free , many in prime areas? Dcc relentlessly blocking buildings higher than 6/7 floors in the docklands, actually going to court to block this! Oh yeah, lack of space in dublin like its hong kong is the issue!

You are becoming a little obsessed with this, someone I worked with purchased a new build in Dublin, in the last month this phrased of the development is sold out as are a lot of new development in Dublin and the surrounding areas, yet any post here about new developments will attract an avalanche of posts about the 10% social housing.

The point I am making is the majority of buyers don't care and are just getting on with buying a home.

JimmyVik · 30-10-2020 11:27am

Just off a conference call at work.
The small talk got around to that I am about to close on a house.
Another guy in my team, same age as me, same job, same salary says how the hell did you save a deposit for a house in this day and age. He says he cant and will never be able to get enough together for a deposit.
Then he says how cant you enjoy yourself while saving for a house.
I said, well I probably go on more holidays than you. I know i drink more and i smoke. Im enjoying it, well not 2020, but in general.

I didnt mention that my car cost €40k and is the only new car i ever bought and his car cost at least €80k and he spends more getting it valeted in a year than I spend on fags ( I must give them up .. again), and he gets a new one every 2 years.
I think his payments on that car probably are more than a mortgage would be.

But its just an example of how two different people save for their goals.
Plenty of people I know are better at saving than I am, and plenty are worse.
Different strokes.

30-10-2020 11:35am

JimmyVik wrote: »

....... his car cost at least €80k and he spends more getting it valeted in a year than I spend on fags ( I must give them up .. again), and he gets a new one every 2 years.
I think his payments on that car probably are more than a mortgage would be.
........

11k/annum depreciation/cost being conservative presuming very low APR...... Realistically 13/14k.

Padre_Pio · 30-10-2020 11:38am

brisan wrote: »

Not saying that ,what I am saying is that you knew house prices were dearer in cork so you cant complain its harder to buy in Cork than Sligo
There is a reason houses are dearer in Cork and in Dublin and cheaper in Sligo and Cavan
So you buy what you can afford and slowly move up the ladder

I'm not comparing Cork to Sligo.
I'm comparing Cork to my mortgage limit, based on my salary.

You have to admit the system is broken if someone on an average wage can't even afford the most basic of basic accommodation. It's like the bottom three rungs on the property ladder have disappeared.

It's also very coincidental that the cost of a new build (300-350k) is right at the limit of what a couple on average wages is able to draw down.

Also, maybe its a cultural thing, but the turnover of property is quite low. Any idea how many houses the average person buys in their life? Two?

Wanderer78 · 30-10-2020 11:43am

Vieira82 wrote: »

problem is when those regulations benefit profit more than actual a functioning economy and social structure...

...and this is exactly where we re at, the structure of our economic systems is now in fact undermining our own most critical of needs, the most obvious failure is in our property needs, we urgently need change this, or this could be catastrophic for us all

JimmyVik · 30-10-2020 12:07pm

Padre_Pio wrote: »

I'm not comparing Cork to Sligo.
I'm comparing Cork to my mortgage limit, based on my salary.

You have to admit the system is broken if someone on an average wage can't even afford the most basic of basic accommodation. It's like the bottom three rungs on the property ladder have disappeared.

It's also very coincidental that the cost of a new build (300-350k) is right at the limit of what a couple on average wages is able to draw down.

Also, maybe its a cultural thing, but the turnover of property is quite low. Any idea how many houses the average person buys in their life? Two?

In general now its couples that are counted as a single unit when buying a house.
I purchase terms, single applicants just cant compete with dual income applicants. Not since the late 80s, early 90s has it been common for both halves of a couple to have one job between them. Blame women joining the workforce working for this

So you should be asking what a couples average combined income can afford for todays housing market.

Padre_Pio · 30-10-2020 1:11pm

JimmyVik wrote: »

In general now its couples that are counted as a single unit when buying a house.
I purchase terms, single applicants just cant compete with dual income applicants. Not since the late 80s, early 90s has it been common for both halves of a couple to have one job between them. Blame women joining the workforce working for this

So you should be asking what a couples average combined income can afford for todays housing market.

Yeh, I understand. I suppose it also comes down to the types of housing. 3 bed (family oriented) semis seem to be the only thing getting built now. Apartment complexes are rare enough in Ireland.

But even if I wanted to rent out the other two rooms, I can't get any allowance on a mortgage, it's purely based on income and savings.

30-10-2020 1:44pm

Padre_Pio wrote: »

I'm not comparing Cork to Sligo.
I'm comparing Cork to my mortgage limit, based on my salary.

You have to admit the system is broken if someone on an average wage can't even afford the most basic of basic accommodation.....................

Padre_Pio wrote: »

Yeh, I understand. I suppose it also comes down to the types of housing. 3 bed (family oriented) semis seem to be the only thing getting built now. Apartment complexes are rare enough in Ireland.

But even if I wanted to rent out the other two rooms, I can't get any allowance on a mortgage, it's purely based on income and savings.

It's grim enough when over €150k is needed to buy a 3 bed in the likes of Youghal tbh.

https://www.daft.ie/cork/houses-for-sale/youghal/8-obriens-terrace-youghal-cork-2609791/#img=9

jill_valentine · 30-10-2020 2:48pm

mariaalice wrote: »

The bit of sacrifice thing is mostly nonsense though not always because people do have different attitudes to money and lifestyle.

There is a difference between saying they can't afford a property anywhere in Dublin or the surrounding areas verse they want a house ( not an apartment ) in a particular area in Dublin or any major city and they can't afford that.

There just seems to be a mental barrier to understanding this.

When people talk about "not being able to afford a house", they do not mean "I can't afford a 3 bed house on O Connell street", they mean something more like "I can't afford anywhere in the county of where I work".

125k is roughly the salary capped mortgage limit in the ballpark of what we've established are the averagish salaries in Dublin.

As of this moment, Daft has a grand total of 7 properties in this bracket. 5 are green field sites. 1 is an apartment in Balbriggan I'm pretty sure is sold this months, and 1 is an auction for an apartment the roof peeled off during a mild storm a few years ago.

So, nothing. There is literally nothing the average worker can buy to live in, in the entire county.

Now lets imagine our worker has eaten nothing for five years and sat indoors with the lights off until they managed to save the €37500 - more than a year of their salary - to bring his buying power all the way to the next bracket of 150k.

Excluding sites, he has 20 properties available - but not so fast.

At least 7 of these are Bidx1 style Auctions, which he can't buy. Two more are covered above. Of the eleven remaining, I know myself at least two are already sold and aren't marked off. Of the nine remaining, one is listed twice and is a shell, one of the others would need major work. So... 6.

There are currently 6 properties available in the county of Dublin to somebody on the average wage with nearly 40 grand in their pocket, assuming nobody bids one penny over asking.

No bitta sacrifice can close that gap.

cnocbui · 30-10-2020 2:51pm

Er, what price do you think that should be, out of interest?

mariaalice · 30-10-2020 3:21pm

jill_valentine wrote: »

There just seems to be a mental barrier to understanding this.

When people talk about "not being able to afford a house", they do not mean "I can't afford a 3 bed house on O Connell street", they mean something more like "I can't afford anywhere in the county of where I work".

125k is roughly the salary capped mortgage limit in the ballpark of what we've established are the averagish salaries in Dublin.

As of this moment, Daft has a grand total of 7 properties in this bracket. 5 are green field sites. 1 is an apartment in Balbriggan I'm pretty sure is sold this months, and 1 is an auction for an apartment the roof peeled off during a mild storm a few years ago.

So, nothing. There is literally nothing the average worker can buy to live in, in the entire county.

Now lets imagine our worker has eaten nothing for five years and sat indoors with the lights off until they managed to save the €37500 - more than a year of their salary - to bring his buying power all the way to the next bracket of 150k.

Excluding sites, he has 20 properties available - but not so fast.

At least 7 of these are Bidx1 style Auctions, which he can't buy. Two more are covered above. Of the eleven remaining, I know myself at least two are already sold and aren't marked off. Of the nine remaining, one is listed twice and is a shell, one of the others would need major work. So... 6.

There are currently 6 properties available in the county of Dublin to somebody on the average wage with nearly 40 grand in their pocket, assuming nobody bids one penny over asking.

No bitta sacrifice can close that gap.

I said its mostly nonsense, however, a better point is should someone with an income that only alowes a mortgage of 125K? be getting a mortgage the rules are there to save people from themselves, so the question really is how should a single person on the 'average' income house themselves in the UK they have a scheme when you can buy equity in a new property and pay rent on the rest. https://www.which.co.uk/money/mortgages-and-property/first-time-buyers/help-to-buy/shared-ownership-awjs50y9dbf6

It does have its problems as well.

30-10-2020 3:24pm

cnocbui wrote: »

Er, what price do you think that should be, out of interest?

About €120k, Youghal has been doing badly for decades now to be fair.

jill_valentine · 30-10-2020 3:32pm

mariaalice wrote: »

I said its mostly nonsense, however, a better point is should someone with an income that only alowes a mortgage of 125K? be getting a mortgage the rules are there to save people from themselves, so the question really is how should a single person on the 'average' income house themselves in the UK they have a scheme when you can buy equity in a new property and pay rent on the rest. https://www.which.co.uk/money/mortgages-and-property/first-time-buyers/help-to-buy/shared-ownership-awjs50y9dbf6

It does have its problems as well.

Absolutely, and for what it's worth my opening statement was more in agreement with you than against.

Somebody on the average wage should be able to afford a single apartment they can pay value into and trade up from later. If we don't have those conditions, we should be engineering them.

Unfortunately, huge tracts of ideal space for this purpose has been wasted on now idle AirBnBs thrown up under the false flag of student accommodation, which can not now be easily retrofitted - by design - into permanent living units.

It would not have taken a great deal of vision to foresee this extremely inevitable situation on the part of planners or government administrators, because everybody else in the country could have seen it from the start of their commute, in Laois.

mariaalice · 30-10-2020 3:43pm

jill_valentine wrote: »

Absolutely, and for what it's worth my opening statement was more in agreement with you than against.

Somebody on the average wage should be able to afford a single apartment they can pay value into and trade up from later. If we don't have those conditions, we should be engineering them.

Unfortunately, huge tracts of ideal space for this purpose has been wasted on now idle AirBnBs thrown up under the false flag of student accommodation, which can not now be easily retrofitted - by design - into permanent living units.

It would not have taken a great deal of vision to foresee this extremely inevitable situation on the part of planners or government administrators, because everybody else in the country could have seen it from the start of their commute, in Laois.

That is another point that is missed, is it people housing themselves or is it acquiring an asset? because they are not the same things.

brisan · 30-10-2020 3:46pm

Padre_Pio wrote: »

I'm not comparing Cork to Sligo.
I'm comparing Cork to my mortgage limit, based on my salary.

You have to admit the system is broken if someone on an average wage can't even afford the most basic of basic accommodation. It's like the bottom three rungs on the property ladder have disappeared.

It's also very coincidental that the cost of a new build (300-350k) is right at the limit of what a couple on average wages is able to draw down.

Also, maybe its a cultural thing, but the turnover of property is quite low. Any idea how many houses the average person buys in their life? Two?

Its not coincidence at all ,as I am sure you are aware
Builders charge what the market will bear not what the asset is worth or cost
That 10-15% profit margin that builders claim is all they get is pure bull****

brisan · 30-10-2020 3:48pm

Padre_Pio wrote: »

I'm not comparing Cork to Sligo.
I'm comparing Cork to my mortgage limit, based on my salary.

You have to admit the system is broken if someone on an average wage can't even afford the most basic of basic accommodation. It's like the bottom three rungs on the property ladder have disappeared.

It's also very coincidental that the cost of a new build (300-350k) is right at the limit of what a couple on average wages is able to draw down.

Also, maybe its a cultural thing, but the turnover of property is quite low. Any idea how many houses the average person buys in their life? Two?

I am on my fourth and last as a home
Bought maybe 30-35 as investments

Padre_Pio · 30-10-2020 3:52pm

brisan wrote: »

I am on my fourth and last as a home
Bought maybe 30-35 as investments

I highly doubt you're the average person.

brisan · 30-10-2020 3:59pm

Padre_Pio wrote: »

I highly doubt you're the average person.

WHY DO YOU SAY THAT
I have a decent leaving cert,
Qualified as an electrician
Wife is a hairdresser ,by training, now an SNA.
I worked hard ,shift work and overtime and nixers
Brother a plumber ,brother a carpenter /cabinet maker
We bought and flipped corporation properties ,doing most of the work ourselves ,12 hr sat and sun and evenings
Bought 3 investment properties with my wife in 2011,rented and then sold so she could buy her own business premises
Bought investment properties with my brothers
Out of that now as I am close to retirement
No one handed us anything ,just hard work ,and a bit of luck and common sense

jill_valentine · 30-10-2020 4:03pm

brisan wrote: »

WHY DO YOU SAY THAT
I have a decent leaving cert,
Qualified as an electrician
Wife is a hairdresser ,by training, now an SNA.
I worked hard ,shift work and overtime and nixers
Brother a plumber ,brother a carpenter /cabinet maker
We bought and flipped corporation properties ,doing most of the work ourselves ,12 hr sat and sun and evenings
Bought 3 investment properties with my wife in 2011,rented and then sold so she could buy her own business premises
Bought investment properties with my brothers
Out of that now as I am close to retirement
No one handed us anything ,just hard work ,and a bit of luck and common sense

If you are close to retirement, you entered into a completely different universe of a first time buying market to the rest of us.

It would not diminish the work you did to come to terms with the fact circumstances are very different now.

brisan · 30-10-2020 4:13pm

jill_valentine wrote: »

If you are close to retirement, you entered into a completely different universe of a first time buying market to the rest of us.

It would not diminish the work you did to come to terms with the fact circumstances are very different now.

We bought our first house in 1982
We had to show 18months of consecutive weekly saving to the building society
From application to approval was nearly 6 months
We had to go in to an off ice and go through the 18 months saving and explain why we missed a week here or there
Then a bridging loan at 20% interest before getting a mortgage at 16 % interest rate
24K house needed a 4k deposit
Trying to save that deposit while on an income tax rate of 58% and PRSI of 7%
No FTB grants of any type available
Yes buying a house back then was a piece of piss
IT HAS NEVER BEEN EASY TO BUY A HOUSE
My children and their generations idea of sacrifice are totally different to my generations
We bought a second hand house and did it up one room at a time as did most of my friends
As a single person buying a house was always nearly impossible

Shoden · 30-10-2020 4:17pm

brisan wrote: »

WHY DO YOU SAY THAT
I have a decent leaving cert,
Qualified as an electrician
Wife is a hairdresser ,by training, now an SNA.
I worked hard ,shift work and overtime and nixers
Brother a plumber ,brother a carpenter /cabinet maker
We bought and flipped corporation properties ,doing most of the work ourselves ,12 hr sat and sun and evenings
Bought 3 investment properties with my wife in 2011,rented and then sold so she could buy her own business premises
Bought investment properties with my brothers
Out of that now as I am close to retirement
No one handed us anything ,just hard work ,and a bit of luck and common sense

Wow, your comprehension is poor. No one was questioning your personal circumstances or traits? Objectively the average person does not buy 30 properties in their lifetime, yet you managed to take that simple statement of fact as a personal slight. I for one will be viewing everything you say in this thread through the lens of the cognitive ability you just displayed.

lainey_d_123 · 30-10-2020 4:24pm

Donald Trump wrote: »

Yeah but your house today has a lot more in it than a house in the 80's. People moved into their houses in the 1980's and did up one room at a time over a few years.

And what of the cost of servicing that mortgage?

The average person should surely be able to save 100k by their 30th birthday should they not? With a bit of effort? No? A couple looking to buy a house at age 30 could have 150k saved between them? Unrealistic or not? Would be less than 200 quid a week to put away.

Edit: Assuming they go to college and start work at 22.

Is this a joke? What planet are you on?

I had pretty much nothing saved on my 30th birthday. My entire twenties were basically living hand to mouth. It was a struggle to even get the rent and bills paid and eat reasonably well, let alone save. I remember my after tax pay in 2008 being something like 1600 euro a month. My rent for a room in a shared house in Dublin was 650 plus bills, the bus to get to work and back was about 150, food about 200...that's already over a grand of my money gone on the basic essentials to stay alive. Then I had things like GP charge, medication, little bit of disposable income to actually have a life, clothes, toiletries....I was lucky if I could even save 100 quid a month.

I'm now 35 and have a fairly decent job and I'm still doing well to save £1000-1200 a month, and that's during a pandemic when there's nothing else to spend my money on at all. I'd still be looking at another 4 years or so to buy a very modest flat, and I'm an above average earner.

I swear some people live on a totally different planet.

Idbatterim · 30-10-2020 4:25pm

I dont doubt it was ever that " easy" but surely there would have bern nowhere near the sane kevels of outgoings then ? Like my parents bought the family home in dublin 14 in 1989 for 16k pounds. That property in same condition today , I reckon would be 325k euro. It was a total gut job and extension rebuild job, and im not talking decor from the 60 or 70's!

Like 16k in 89 must have been around the average industrial wage, the same house now in same derelict condition, would cost nearly ten times the average industrial wage!

Its very easy to sort out, government dont want too though, forca myriad pf reasons, thats very obvious at this stage ..

jill_valentine · 30-10-2020 4:27pm

brisan wrote: »

We bought our first house in 1982
We had to show 18months of consecutive weekly saving to the building society
From application to approval was nearly 6 months
We had to go in to an off ice and go through the 18 months saving and explain why we missed a week here or there
Then a bridging loan at 20% interest before getting a mortgage at 16 % interest rate
24K house needed a 4k deposit
Trying to save that deposit while on an income tax rate of 58% and PRSI of 7%
No FTB grants of any type available
Yes buying a house back then was a piece of piss
IT HAS NEVER BEEN EASY TO BUY A HOUSE
My children and their generations idea of sacrifice are totally different to my generations
We bought a second hand house and did it up one room at a time as did most of my friends
As a single person buying a house was always nearly impossible

Once again, nobody here ever said it was easy. The difference is, it was not impossible. It was possible to work hard enough, as you did, to close the gap.

I'll refer you to my above post using figures from Daft to illustrate it just no longer is, for all intents and purposes - no matter how many hours somebody works, it is not possible to bridge the gap between the buying power they're permitted and the properties available.

Again, it is no slight on you and the work you put in to point out the conditions you were able to buy in on no longer exist.

The fact you keep talking about "house" buying, and highlight a "second hand" house underlines the disconnect here - how many single FTBs do you think are expecting to buy houses in 2020? How many do you think expect to build new? On what land, with what PP, with what evidence of local need?

brisan · 30-10-2020 4:31pm

Shoden wrote: »

Wow, your comprehension is poor. No one was questioning your personal circumstances or traits? Objectively the average person does not buy 30 properties in their lifetime, yet you managed to take that simple statement of fact as a personal slight. I for one will be viewing everything you say in this thread through the lens of the cognitive ability you just displayed.

The OP said circumstances are very different now that's what I was replying to
It is and always was very difficult to buy a house (except during the celtic tiger years )
Plus do not be so condescending
Its an ugly trait to have

Is The Property Market Unfair to First Time Buyers?

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