Buy now or wait?

Amberman

kmick wrote: »

I think the point I am making is that at least you will be paying your 15k towards your own mortgage rather than someone elses. As long as you can afford the payments and you do have the 10% deposit I say go for it. If it is your family home then what you gain from it compared to renting is not measurable. Screw the begrudgers who will tell you to rent a 1 bedroom shoebox for ever - paying the mortgage of some solicitor from ballsbridge.

You're nuts

gurramok

GinnyJo wrote:

Hmmmmmm never said we couldn't afford the mortgage without a lodger, we can.
It also won't be a stranger, and it won't be 3-4 years, thats a lot of assumptions being made

Good for you, not many people can take in a lodger they 'know' if they wanted to.
Sounds like you don't need a lodger when you can well afford the mortgage, then why mention a lodger in the first place?

patrickolee wrote: »

I went for 'buy now if...'. My if would be that you are in a secure job, wont be streching too badly to make payments if we get 0.5% increase in mortgage rates and intend to stay where you are buying for 5ish years.

If all of those are true, then now is an excellent time to buy as its your market. The market will recover eventually and if you try to wait until the bottom you will invariably miss it as everyone else will be doing the same. Rents are rising quite quickly of late as a result of a great number of people sitting back and waiting for the 'bottom'. When all those people wake up and decide that actually the bottom has been reached (probably precipated by some RTE economist deciding the property falling story has gotten rather old!), be that in 6 months or 6 years, there will be a huge increase and you will find it difficult to find a place.

So short answer, if you're in it for a home, you have nothing to worry about; the current conditions offer an opportunity.

To sum up, if you don't care about losing money or a buying a deflated asset to live in for 5+yrs, go ahead and buy.
I agree that there are people who would buy based on those circumstances, some would be desperate where emotions enter the arena, they wouldn't be that numerous!

Misleading about rents, they are about the same as they were in 2002 inflation adjusted afaik.
As said the amount of rental properties available has doubled since this time last year, thats a good sign to continue to rent as you can negotiate a cheaper rent or jump ship to choose literally tens of properties in your immediate area
By your analysis, when all those renters jump ship to buy at the 'bottom' whenever that is, the rental market will collapse so winners all around for buyers and renters, thats a good thing!

someuser90

follow patrickolee & kmick crazy vested interest advice :rolleyes: to loose thousands of euro, by not waiting a few years to buy

why the fcuk would anyone buy into an obviously crashing market???

these graphs show how the number of rental properties has doubled in 6 months :eek: http://daftwatch.atspace.com/

janmc

someuser90 wrote: »

these graphs show how the number of rental properties has doubled in 6 months :eek: http://daftwatch.atspace.com/

I'm a little sceptical about those figures, because Daft has only become popular for sales relatively recently. I'd be more interested in the same for Myhome to make a decent judgement.

Edit - I just saw you mentioned rental not sales... apologies

Firetrap

I want to buy my own place (it will be on my own) but I'm happy to sit and wait for a while and save up money towards the big purchase. I honestly don't know how much more prices are going to drop but they sure as heck aren't rising at the moment.I've got a reasonably well paid secure job but if I was to buy now, the mortgage repayments would put me to the pin of my collar. I don't want to buy a cardboard shoebox and hope that someone will take it off my hands in a few years time if there's any chance at all of my getting what a lot of FTBs really want - the classic semi-D with front and back gardens. I don't want to resort to taking in tenants to pay the mortgage - I've had enough of renting with strangers to last me a lifetime.

Amberman

If you absoultely cannot wait to buy a house and you are happy to watch it go to (IMHO) half its current REAL value in 8-10 years, do it. If thats the price you are willing to pay to get out of living with strangers...then thats the right thing for you...horse for courses. Personally, id rather watch a sucker take the capital hit.

superweld

Amberman wrote: »

If you absoultely cannot wait to buy a house and you are happy to watch it go to (IMHO) half its current REAL value in 8-10 years, do it. If thats the price you are willing to pay to get out of living with strangers...then thats the right thing for you...horse for courses. Personally, id rather watch a sucker take the capital hit.

half??? is that a pessimistic or optimistic attitude?? (you're going to say realistic )

seriously, you think house prices will half in value? and you say REAL value meaning they will be a lot less then half the current asking prices?

:eek:

mikemac

Firetrap wrote: »

I want to buy my own place (it will be on my own) but I'm happy to sit and wait for a while and save up money towards the big purchase. I honestly don't know how much more prices are going to drop but they sure as heck aren't rising at the moment.I've got a reasonably well paid secure job but if I was to buy now, the mortgage repayments would put me to the pin of my collar. I don't want to buy a cardboard shoebox and hope that someone will take it off my hands in a few years time if there's any chance at all of my getting what a lot of FTBs really want - the classic semi-D with front and back gardens. I don't want to resort to taking in tenants to pay the mortgage - I've had enough of renting with strangers to last me a lifetime.

Excellent post and it sums up my situation also.
I could afford a shoebox in Dublin or a decent house outside Dublin and spend hours commuting but for now, I'm happy saving over €1,000 per month and to pay reasonable rent to live 5 minutes from work.
I've had enough of renting with strangers also, been doing it for too many years so no way would I take a lodger into my home if I could avoid it

One day I'll own my own place but not yet and not until it's a property that I desire rather than any property just for the sake of getting on the ladder (what's the opposite of ladder? )

DublinDilbert

superweld wrote: »

half??? is that a pessimistic or optimistic attitude?? (you're going to say realistic )

seriously, you think house prices will half in value? and you say REAL value meaning they will be a lot less then half the current asking prices?

:eek:

Well if you consider that asking prices have dropped by 10% ->12% last year, thats going by the banks figures.

In reality prices have dropped some where in the region of 15%->20%, due to on the way up properties sold well above the asking price, and on the way down they are selling way bellow the asking price.

If this was to persist for a couple of years, the drops would amount to what the poster above indicated.

The fact at the moment is that although some houses are selling, there's many apartments that are not even getting one viewing, can't see this changing. In many areas new apartments aren't selling and the asking price is way less than second hand apartments in the exact same area.

janmc

micmclo wrote: »

I'm happy saving over €1,000 per month and to pay reasonable rent to live 5 minutes from work.

My problem with this is (I'm the OP btw) is that in my case I'm paying so much on rent that I can only save €500 approx per month. I know it's better than nothing, but I feel that my rent is eating into my potential savings/investment.

My views after taking everyone's advice on board, is to block myhome and daft from my computer for 6 months, and then look at things again then. In 6 months time, things may look a little clearer.

Thanks everyone for your help, and I'll keep an eye on this thread in case there are any more comments.

mikemac

Best of luck OP whatever you decide and if you want more help saving money maybe stroll over to this forum

It helps me anyway

JJJJNR

So does anyone think as the US markets drift into a recession that right now might be the last chance you'll actually get to own your own house, or will the banks always give out mortgages, even in a recession.

superweld

JJJJNR wrote: »

So does anyone think as the US markets drift into a recession that right now might be the last chance you'll actually get to own your own house, or will the banks always give out mortgages, even in a recession.

good question. 100% mortgages seem to be limited now to public sector and certain professionals. does anyone reckon that banks will stop giving 95% mortgages at some stage to us 'common' people?

SkepticOne

JJJJNR wrote: »

So does anyone think as the US markets drift into a recession that right now might be the last chance you'll actually get to own your own house, or will the banks always give out mortgages, even in a recession.

The important thing to remember is that if borrowing becomes harder then house prices must fall. The easy credit of recent years did not make buying a house any easier, it just forced up prices.

patrickolee

superweld wrote: »

good question. 100% mortgages seem to be limited now to public sector and certain professionals. does anyone reckon that banks will stop giving 95% mortgages at some stage to us 'common' people?

Good question indeed. Did anyone hear the announcement that EU is about to open up the credit market? On Morning Ireland this morning. It will make it easier, for example, for a German bank to lend to a Spanish borrower, or maybe to an Irish borrower? What effect do you think that will have?

How Strange wrote: »

GinnyJo, in the Crumlin area - on the main Crumlin Rd into town to be exact - I drive past four houses that have been on sale since around Sept. One has a price reduced sign up and it was put up at a time when Bertie and his band of merry men were telling us that there was no property crisis and to stop worrying. I would've thought that this part of Crumlin would have traditionally been popular with couples etc trading up from apartments because of the location and proximity to town.

Interesting that you should use that example. I live about 200m from there and noticed that sign myself. It has as you said been there for quite a while. However that is Crumlin Road, a very busy noisy road and one of the last places I personally would buy. If you were to drive up the next road east, you would have seen a few house with Sold and Sale Agreed signs. To be fair, you would also have seen a few houses with For sales signs that never sold, but the point is, those 3 houses are a very special case.

To the OP, waiting 6 months may be no harm. Best of luck.

Amberman

superweld wrote: »

half??? is that a pessimistic or optimistic attitude?? (you're going to say realistic )

seriously, you think house prices will half in value? and you say REAL value meaning they will be a lot less then half the current asking prices?

:eek:

Its simply my opinion. People don't understand REAL values very well. (Id say this post will stun a lot of people) Let me put it to you like this...the definition of inflation is the rate of expansion of the money supply...it is NOT NOT NOT the increase in prices of a basket of goods (which is caused by money supply expansion) as measured by the ECB or whoever. So the money supply is expanding at 12-14% per annum (I cant be bothered to source this.,..someone please provide a source here). That is the TRUE inflation rate in the ECB right now...@12% The pensioners/public sector workers don't get this as a pay rise each year

The REALLY REALLY REALLY big lie that the ECB and every other central bank in the world tells the unwashed is that they CAUSE and KNOW they cause inflation (which is essentially a tax)...but they sure as hell don't want you to know that, while they tell you that they're doing everything to bring it under control. Its a bare faced scam when you really understand it.

Therefore to stop falling in REAL, the price of property needs to rise by the rate of money supply expansion each year. People..we have a fiat currency and fractional reserve banking system...backed by nothing and expandable at a whim...these asset bubbles are inevitable. Understand what those 2 things are and you are on your way to being a super investor.

LAst year ACTUAL property prices fell by 12% but the MEASURING STICK (currency value) was shortened by about 14% so the real value of property fell last year by 26%.

Some clever person please go away and measure property prices in a scare commodity (try oil and gold) in the last 12 -15 years, and you will prob find house prices have hardly moved when measured in something more stable that currency.

Based on all that, I think 50% is optomistic...we're already half way there IN REAL TERMS...could be much worse...50% might be the ACTUAL fall in 8 years time or so. The UK has just had teh worst 1 month fall since (gulp) 1986. And we all know what happened then and how long it took to come back.

Its gonna be bad, real bad.

kmick

someuser90 wrote: »

follow patrickolee & kmick crazy vested interest advice :rolleyes: to loose thousands of euro, by not waiting a few years to buy
why the fcuk would anyone buy into an obviously crashing market???
these graphs show how the number of rental properties has doubled in 6 months :eek: http://daftwatch.atspace.com/

Im not a vested interest I am just a working stiff with a mortgage and a house I bought 6 years ago before the market went crazy. And the guy wants to buy a family home not a rental property so why would he care about rental property occupancy rates. Just because I take an opposite position to you dont try and attack my credibility.

To the OP - none of us have a clue what way the market will go and as you say you cant afford to save more than 500/month beacuse of rent. Well take your rent + that 500 and put it towards a mortgage. Its your family home - I am going to keep saying it because it does not seem to be sinking in.

patrickolee

kmick wrote: »

Im not a vested interest I am just a working stiff with a mortgage and a house I bought 6 years ago before the market went crazy. And the guy wants to buy a family home not a rental property so why would he care about rental property occupancy rates. Just because I take an opposite position to you dont try and attack my credibility.

Ditto for me... not a vested interest, just a lowly programmer. But it's easier for them to think of us as vested interests as this way they can understand why someone would say something to contradict their viewpoint. If we weren't vested interests it might be leave open the possibility that they were wrong! Shock horror.

mayhem#

As prices will only go down I would wait for a year at least.
However if you do decide that you want to buy now do drive a hard bargain.
Any seller who manages to sell for anything near the asking price is extremely lucky...

E.

SkepticOne

kmick wrote: »

And the guy wants to buy a family home not a rental property so why would he care about rental property occupancy rates.

It is valid to draw comparisons with the rental market, imo for two reasons. 1) If the rental market fails to produce returns for investors the value of investment properties will fall and this will have a downward effect prices generally. 2) The options for renters will improve and the balance shifts in favour of waiting and renting rather than buying now.

To the OP - none of us have a clue what way the market will go and as you say you cant afford to save more than 500/month beacuse of rent. Well take your rent + that 500 and put it towards a mortgage. Its your family home - I am going to keep saying it because it does not seem to be sinking in.

How do you know no one else has a clue?

Sometimes it is cheaper to rent than to buy and the money saved through renting can be invested and put towards the eventual purchase of a house. You don't seem to be taking this into consideration.

By your reasoning, it never makes sense to rent no matter how overvalued house prices get.

A Dub in Glasgo

I am one of 6 (so far) who have answered truthfully

Colonel Sanders

I have also answered truthfully, in my opinion the thing to do is wait and see what happens in the market for a year.

Btw have a look at this

EDIT: Not just dubin glasgow, everyone!

SkepticOne

A Dub in Glasgo wrote: »

I am one of 6 (so far) who have answered truthfully

LOL.

is_that_so

How Strange wrote: »

These seem to be desperate times indeed.

Think that type of comment is really reserved for when there is something appalling happening like a war or say massive unemployment.
On a more positive front a friend of mine has three confirmed viewings on the same day for her property. It has taken few weeks to get there but there is interest and I for one am not surprised.

astrofool

What type of property is it? Does she expect to get asking price, or what % of it is she willing to accept?

is_that_so

astrofool wrote: »

What type of property is it? Does she expect to get asking price, or what % of it is she willing to accept?

Not sure about that but will find out. It is in a very good location so that could also be part of it.

kmick

SkepticOne wrote: »

How do you know no one else has a clue?

Are you really asking me this. Do you think there are super beings who control the markets. Some peole can manipulate small parts of their markets but some loony flies a plane into a building and all bets are off.

SkepticOne wrote: »

Sometimes it is cheaper to rent than to buy and the money saved through renting can be invested and put towards the eventual purchase of a house. You don't seem to be taking this into consideration.

This generalisation may hold. However I am commenting in this specific OP case of a couple buyng a 300k family home in Crumlin (where prices have risen but housing is still affordable for those on an average industrial wage).

External factors aside which none of us can predict I just cannot see why wasting another 15k in rent this year while waiting for prices to drop makes sense. Maybe I am missing something.

SkepticOne

kmick wrote: »

Maybe I am missing something.

Probably worth rereading some of the responses earlier in the thread on this point, in particular one by A Random Walk about offsetting rent against interest payments.

kmick

SkepticOne wrote: »

Probably worth rereading some of the responses earlier in the thread on this point, in particular one by A Random Walk about offsetting rent against interest payments.

You are going to be paying interest whether or not you buy now or later. You can never reclaim rent paid.

By all means rent its just not for me. I prefer the security of co-owning my own patch (allbeit the bank owns 1/2 of it).

Tom123

kmick wrote: »

You are going to be paying interest whether or not you buy now or later. You can never reclaim rent paid.

What sort of point is that
You can never reclaim interest paid either.

At the moment it is better financially to rent than it is to buy.