Buying from DCC now? Advice appreciated

seahorse

Someone very close to me is considering buying his apartment in Ballymun from Dublin City Council soon. He has been renting from DCC for twenty years in Ballymun, so as there’s a discount for every year of rental there’s a pretty hefty reduction in the price, though how much exactly I don’t know.

He’s in one of the new apartments that were built three years ago (after having been re-housed from his old block which was demolished) and it’s situated near old blocks which are due to be pulled down two years from now. He reckons that if he buys before those blocks are pulled down their removal will then up the price of his apartment.

I’d hate to see him making a mistake and I’d REALLY appreciate anyones considered thoughts on this.

patrickolee

I'd say he's probably right to buy, especially if he's happy living there at the moment. Ballymun, while in some peoples head might have a bad name, is not that far out (compared to people travelling from kildare meath, etc) and is v handy for the airport. It will be re-generated in time, when all the blocks come down and probably will appreciate. Most importantly if he is getting a big discount, can afford to live there, wants to live there, then go for it.

seahorse

patrickolee wrote:

I'd say he's probably right to buy, especially if he's happy living there at the moment. Ballymun, while in some peoples head might have a bad name, is not that far out (compared to people travelling from kildare meath, etc) and is v handy for the airport. It will be re-generated in time, when all the blocks come down and probably will appreciate. Most importantly if he is getting a big discount, can afford to live there, wants to live there, then go for it.

Thanks Patrickolee; something I forgot to mention is that he intends to buy this apartment as an investment. The way he's looking at it, Ballymun is practically in Dublin city now with the way the city has expanded; there's a new bus service that gets you into town in no time down the bus lanes, which run uninterupted all the way down the Ballymun road. The metro will be running straight through Ballymun in a couple of years.

The regeneration is already half way to being complete, and encouraging a social mix has been a big part of that. Rent allowance, for example, in the new apartments is not allowed. In other words, big moves are underway to change the image and feel of Ballymun as a place to live. So he sees positive signs of this being a good investment opportunity; but if prices continue to drop as they have been doing, how good of an idea is it really? That's what's worrying me...

tbh

is there some form of clawback? In other words, if prices DO go up and he sells, would he have to pay DCC some money?

antoinolachtnai

What do you mean by investment? Does he mean moving out and renting it? I don't know if they'd like you renting your apartment after buying it out. He'd certainly be facing stamp duty issues, and the stamp might be due on the full value of the property, not the discounted price.

He should check out the legalities.

I'd say myself that it's a pretty good buy no matter what the renting situation is. Ballymun is becoming a nicer and nicer place to live all the time (of course it was always a great place to live in many ways).

Victor

Also Metro North should add €50,000-100,000 to its value. Only 10-12 minutes to the city centre.

seahorse

No, that's one of the advantages of buying a home you've been renting from DCC or one of the County Councils; there's no claw-back; once you buy your home it's your own business what you earn from it when you sell it on, unlike the affordable housing scheme. It's also your own business if you intend to rent it; any issues there would be between yourself and the tax man, not DCC.

And yes Victor, I reckon the Metro North line would sweeten the deal considerably. Still, I don’t know nearly enough about housing issues to advise him. Does anybody know an office or body he should contact to get advice in relation to all this?

antoinolachtnai

Best thing to do is go and find out how hard/easy it is for him to get a mortgage. If the bank is all on for it, it's probably a good investment. The bank won't get involved unless it is pretty certain it can get its money out if something goes wrong.

Getting independent financial advice about property is tough and expensive. If someone knew so much about property, why would they sit around answering questions about it?

You can also go and ask the estate agents what they think the prospects are for the area and whether they would be interested in selling it in a few years. You might find someone who can help, you might not.

Metro north is a long-term game at this stage. I think we are realistically looking at 2015 or later.

seahorse

By the way, a relation of mine bought a 2 bed house in Cabra West for 7.500 thirty years ago and is now in the process of selling it back to the corpo for 385.000 That's what they've offered her, the paperwork has been signed and she just has to wait a few weeks now for everything to go through. I was very surprised to hear that, even though she still owed 1.500 on the mortgage (just never bothered paying it off as she had insurance on the mortgage) all DCC did was stop 1.500 out of her 385.000, never charged her a penny in interest or anything!

I was sure that 1.500 debt was going to mess her up in some way. It seems DCC can be very lax in these matters (lucky for her!) The mortgage should have been paid ten years ago and I would have thought that 1.500 could have grown considerably since then what with interest and house price rises etc. Maybe the insurance she got out protected her from that sort of eventuality, I don’t know..

antoinolachtnai

The interest on 1500 euros over 10 years at the rates of the last decade wouldn't even double the amount, so it's not really worth the council's while getting too stressed over.

seahorse

He should be going to the bank this side of Christmas anyway, so yeah, that should give him a clearer idea.

antoinolachtnai wrote:

You can also go and ask the estate agents what they think the prospects are for the area and whether they would be interested in selling it in a few years. You might find someone who can help, you might not.

I'll suggest that to him; thanks for that.

antoinolachtnai wrote:

Metro north is a long-term game at this stage. I think we are realistically looking at 2015 or later.

I dont think it'll be that late tbh; I'm getting the impression it'll be more like 2012, which is less than five years. There was a lot of hold-up at the planning stage as to whether it'll be underground, overground or something called a cut and cover operation as it runs through Ballymun. There were a lot of protests from local groups about the plans to run it overground; they wanted it fully underground. One of the local Sinn Fein politicians dismissed the images of it overground at a meeting and requested that they present the same images covered in graffiti, lol. So all that carry on held things up just in the planning stage by about eighteen mths.

They've eventually settled on cut and cover, which means it'll be running just below ground with a metal covering over it. I'd hope it'll be completed by 2012; those are the plans anyway, but then as you suggest, you can always tack on an extra couple of years when you're talking about a government body, so who's to say?

As to the 1.500 issue; is there no way they could have somehow tied that into the rise in value of her home?

antoinolachtnai

I was actually checking on Metro North last night. This project has not yet gone to tender and there is still public consultation going on.

The difficult part of the project is going to be in the city and airport stretches, rather than in Ballymun.

It is not realistic to build and open that line in 3.5 years. It is going to take the best part of 2 years to build and open the Luas extension to the Point, and that is a much simpler project.

clawsthefirst

If he's been living in Ballymun for twenty years and he's happy there he should go for it. He won't get better value that close to the city anywhere else and sure until the metro is built there's always the No.4 bus- flies into town! And the 500 people that'll be employed in IKEA when it opens are all going to have to live somewhere.