McWilliams' latest rant, and to buy or not to buy?

ricman

This column makes no sense, so he thinks every house in dublin is worth 136k.
WILL you be able to buy a 3bed home in killiney for 136k.I doubt it.You are getting offered a house in dublin 8 for 250k,.
I dont think you are getting ripped off.People always will pay a bit extra to live in area x.Thats their right .I dont think its smart to stay in rental accomodation and pay say 60k rent for the 6 years.
Ive not seen any drop in prices in dublin in the last 9 months.
Its worth looking to see could you get a similar 3bed house on the southside for 250k.ID be more worried about buying an apartment ,in regard to loss of value.
Theres not many empty houses in middle class areas on the southside of dublin.

MaceFace

Shambo wrote: »

My reasons for thinking prices are still too expensive?
Unemployment rising
300,000 empty units
Interest rates going up
Emigration going up

Anyone think of any more?

Banks not lending.
Repossession moritorium still keeping people in their houses.
Rent supplements will be cut further putting downward pressure on rents.
People on interest only mortgages will revert back to capital + interest.

None of this takes into account what may happen with NAMA or government deficit.

domcq

ricman wrote: »

Ive not seen any drop in prices in dublin in the last 9 months.

I'm not sure where you've been looking but I've seen substantial price drops in Dublin in the last 9 months.

MaceFace

ricman wrote: »

This column makes no sense, so he thinks every house in dublin is worth 136k.
WILL you be able to buy a 3bed home in killiney for 136k.I doubt it.You are getting offered a house in dublin 8 for 250k,.
I dont think you are getting ripped off.People always will pay a bit extra to live in area x.Thats their right .I dont think its smart to stay in rental accomodation and pay say 60k rent for the 6 years.
Ive not seen any drop in prices in dublin in the last 9 months.
Its worth looking to see could you get a similar 3bed house on the southside for 250k.ID be more worried about buying an apartment ,in regard to loss of value.
Theres not many empty houses in middle class areas on the southside of dublin.

Bertie, is that you?

He never claims every house will cost the same - it is the average.

And as for you not seen any price drops - you mustn't have been looking.
Go here or here or here or here or get this

Some people.......

oflahero

MaceFace wrote: »

Banks not lending.
Repossession moritorium still keeping people in their houses.
Rent supplements will be cut further putting downward pressure on rents.
People on interest only mortgages will revert back to capital + interest.

None of this takes into account what may happen with NAMA or government deficit.

And the elephant in the room, the biggie: servicing our incredible, unforgettable, ginormously unpaybackable sovereign debt.

Oh sorry! I forgot the NAMA debt was off-balance-sheet!

TC cork

u have to be careful but I would offer under the present bid say 230 seller is going to take whatever they can get..

good luck

PMC999

TC cork wrote: »

u have to be careful but I would offer under the present bid say 230 seller is going to take whatever they can get..

good luck

I agree. If you really like the house but think it will cost 10 / 20 / 30% cheaper in a year then offer that lower amount. You never know how desperate the seller is to sell!

Cavehill Red

Highly Salami wrote: »

Maybe they fixed their interest rate, so it doesnt matter if they go up.

Fixed rate for 40 years?

SoupyNorman

MaceFace wrote: »

Banks not lending.

This is inaccurate, maybe accurate for small businesses but for property buyers I dont see it to be the case.

The anecdotal evidence alone would suggest that lending has not stopped full. Two work colleagues have both got mortgage approval for just under €200k in the last 3 months, sure have a quick scan on this forum and you'll see numerous posters with approval. I would say that the rate of approval has decreased due to the axing of 100% mortgages, closer analysis of ability to pay and banks valuation on the property but it certainly is not appropriate to say banks are not lending.

ntlbell

I think when people say banks not lending they're saying

"banks not given stupid amounts of money away to people who can't afford it"

Banks are lending, they're just actually doing their jobs now, checking for savings history, looking for deposits, not giving out 10X's double gross incomes etc

MaceFace

SoupyNorman wrote: »

This is inaccurate, maybe accurate for small businesses but for property buyers I dont see it to be the case.

The anecdotal evidence alone would suggest that lending has not stopped full. Two work colleagues have both got mortgage approval for just under €200k in the last 3 months, sure have a quick scan on this forum and you'll see numerous posters with approval. I would say that the rate of approval has decreased due to the axing of 100% mortgages, closer analysis of ability to pay and banks valuation on the property but it certainly is not appropriate to say banks are not lending.

As ntlbell correctly said, banks are of course still giving out mortgages, but under much stricter controls.

Have a read of this to understand the difficulty in actually getting a mortgage.

The other difficulty is that banks often value a property for a lot less than the actual person who wants to purchase.

Either way, the difficulty in obtaining a big mortgage for many people will force prices down.

foxyboxer

Interesting article from McWilliams.

In trend following, you never buy in at the bottom or get out at the top.

If you check the ESRI house price index, you can see that the trend is clearly down since March 2007.

Prices are still falliing on average 3-5k per month. When prices rise for a sustained period of 6 months, then it's worth considering a buy. These charlatan's will never learn!

BobbyD10

Shambo wrote: »

My reasons for thinking prices are still too expensive?
Unemployment rising
300,000 empty units
Interest rates going up
Emigration going up

Anyone think of any more?

What I a struggling to grasp is how the government expect people whom are already struggling, to pay a property tax and water charges next year.

papsita

SoupyNorman wrote: »

Where do you refer to when you say "this kip", as if this implies that you only restrict your search to one area then of course your choice is going to be limited. If you're not willing to consider other areas then you dont really have a right to complain. Dublin is not a big place and you can give yourself a radius to work from then your choices open up!


Alls I know is that there is at least 15 properties that I would be pretty happy to rent tomorrow, I'm on DAFT every day and I have DAFT alerting me when new properties are posted in my specified areas. What I have noticed is that the number of properties has increased, properties of varying quality but the overall effect is that the supply is increasing with decreases the price.

When I say "this kip" I mean Ireland as a whole. I was merely expressing my frustration with the state of the nation rather than any particular postcode. My mind is always open to location when it comes to renting as I enjoy getting a flavour for different parts of Dublin without having to commit to them for a lifetime.

As for Daft, OK, have you viewed these 15 properties Soupy? I have rented in Dublin for the past ten years, have moved around a lot, been on that email alert on and off for ages and still monitor Daft like a hawk (to the point of being driven daft). And in my experience, the difference between the online brochure and the reality is almost always staggering. What looks gorgeous online is four times out of five a dump, or has some unacceptable issue going on such as poor heating. So of those 15 you think acceptable, I'd say that if you actually viewed them, that figure would probably be narrowed down to one or two - and you'd face competition for them to boot. Renting is not a walk in the park, IMO.

Shambo

ntlbell wrote: »

I think when people say banks not lending they're saying

"banks not given stupid amounts of money away to people who can't afford it"

Banks are lending, they're just actually doing their jobs now, checking for savings history, looking for deposits, not giving out 10X's double gross incomes etc

I tried to get a mortgage for €60,000 this week and was knocked back by every financial institution I went to- I own my own business, only trading since Jan (but already profitably)

I have no loans, 0€ on a visa and no other debts at all- my rent is €600 per month and teh mortgage would have been about 390€per month.

I was told off the record that only Guards, Teachers, Doctors and Nurses are getting mortgages.

Cavehill Red

That's pretty low-ball for a mortgage.
Did you explore the option of taking a term loan for that amount?
Lending criteria usually include a minimum drawdown which is usually higher than 60k.

Shambo

Cavehill Red wrote: »

That's pretty low-ball for a mortgage.
Did you explore the option of taking a term loan for that amount?
Lending criteria usually include a minimum drawdown which is usually higher than 60k.

Yeah, CR, we explored all options but they are just not budging, I'm over it now as I think we'll just hold off for another while and just pay cash as I still think prices have a way to go.

By the way, I'm a St Malachy's boy-used to live on Hughenden Avenue-the reds are doing well this season

Cavehill Red

Aye - Red Army. I'm Spirit of 79 myself!

dario28

Check out this clown

http://www.independent.ie/opinion/letters/irish-houses-are-undervalued-2149398.html

"In Ireland you can buy three- and four-bedroom houses for around €130,000." ...ya and your nearest tesco is a 2hr drive !

D3PO

Shambo wrote: »

I was told off the record that only Guards, Teachers, Doctors and Nurses are getting mortgages.

I had better tell that to my accontant friend who got approval the other week :rolleyes::rolleyes:

MuffinsDa

D3PO wrote: »

I had better tell that to my accontant friend who got approval the other week :rolleyes::rolleyes:

Yeah, I got approval and actually GOT a mortgage just last month, and I'm in none of those professions! And single-income family.

Idbatterim

Shambo I was reading up on becoming self employed the other day, both my parents already are, and one thing it mentions about becoming a sole trader ltd co. or both was that one would not be elligible to get a mortgage for atleast 3 years due to the inherent risk of new businesses, especially with the way things are now.

Shambo

Cavehill Red wrote: »

Aye - Red Army. I'm Spirit of 79 myself!

Marty Quinn's gonna knock your balleeks in!
His daughter lives near me in Tuam

daltonm

Shambo wrote: »

I tried to get a mortgage for €60,000 this week and was knocked back by every financial institution I went to- I own my own business, only trading since Jan (but already profitably)

I have no loans, 0€ on a visa and no other debts at all- my rent is €600 per month and teh mortgage would have been about 390€per month.

I was told off the record that only Guards, Teachers, Doctors and Nurses are getting mortgages.

There may be an element of truth to that - but the end part of that story is that they are getting in around 20% less then they need, so it's no in a different language (friends of mine in both these professions are experiencing this at the mo).
The truth is that there are savage cuts on the way, historically mortgages for PS could be based on the next 3 increments - not so anymore.