First Time Buyer - Advice

highgiant1985

Hi Folks,

I'm a 25 year old in Full Time Employment for 4 years and I'm currently renting. I am planning to be in a position tobe a first time buyer in approx 2 years time. (will depend on factors at the time e.g. interest rates/house prices etc... but I'm trying to get myself into a position where I could buy if I want to in 2 years)

I'd appreciate any advice for people with experience but the following is my outline at the moment in terms of my thinking/what I'm planning.

* Hoping to buy a 3 bed house for approx 120k (Kilkenny City)
* Planning to have a deposit of approx 20k by then
* Following budget 1% of the house price would be gone from deposit towards stamp duty
* I would be seeking a mortgage of approx 100k from Bank. (This is approx 3 times my salary (its v slightly less than 3 X my salary))
* I have no other loans of any sorts at the moment (fully paid off) and currently I owe 0 on my credit card

I realise the value of the house can fall after I buy but thats something i'll make a decision on myself when it comes to the time. If I buy it would be because I'd be happy to live in this house long term.

What worries me more is the hidden costs, like solicitor fees etc... both in the initial purchase and after I move in.

So my questions are

Q1 * For the price range I'm planning on buying at would a deposit of approx 20k be enough? Obv more is better but I'm trying to be realistic about what I can have saved by that time frame.

Q2 * What are the hidden costs I need to consider before buying as well? The ones that spring to mind for me are

* solicitors fee (approx 2k?)
* Bin charges (650?)
* ESB (approx 30 per month)
* Heating (approx 30 per month)
* tv license fee (165 per year)
* Mortgage repayments (varies doing my own research on this)
* Living costs (food / travel / entertainment etc...) (doing my own research on this)
* Possible new budget taxs/house charges/interest rate changes (will stress test myself to see if I can handle increase in payments for these senarios)


Are there any other costs I should consider?


NB - I understand that anything posted by users here is only an opinion and that I as an adult am responsible for my own decisions.

galah

don't forget that you may need furniture and money for repairs/redecoration etc - if anything breaks, it's now your problem, no more 'ring the landlord'...

tc2010

Youve done your homework.

If i was you id also keep a few euro for a rainy day. Plenty of people have lost there jobs after buying houses

If your job is safe id go for it.

johndaman66

Fairplay to you Highgiant1985 you seem to have put some thought into it and seem astute. As mentioned by another poster having a rainy day fund (or whatever you want to call it) would certainly be no harm. Boilers, washing machines etc. have being known to break down and can be expensive to get fixed...just a buffer to cover uncertainties. Not sure if you have considered home insurance and mortgage protection insurance would be strongly advised by most also. Water charges seem to be coming also. There would seem to be some uncertainty with regards what basis will be used to charge households but have heard an approximate figure of €500 being mentioned on a few occasions

ricman

legal fees should cost around 1000 to 1500 for a 120k house, you have to take in to account your present expenses,esb, rent,heating etc
work out what would happen if loan rates go up to 5 or 6 per cent.
the ber rate is very important,a badly insulated house with no double glazing can cost twice as much too heat as a well insulated house.theres tax credit for interest paid on the first 7 years,its up to you to claim it, mortgage interest deducted at source,ie from the loan,after you claim it.

highgiant1985

ricman wrote: »

legal fees should cost around 1000 to 1500 for a 120k house, you have to take in to account your present expenses,esb, rent,heating etc
work out what would happen if loan rates go up to 5 or 6 per cent.
the ber rate is very important,a badly insulated house with no double glazing can cost twice as much too heat as a well insulated house.theres tax credit for interest paid on the first 7 years,its up to you to claim it, mortgage interest deducted at source,ie from the loan,after you claim it.

thanks for all the replys so far folks. Just one thing to add in case any one else is reading this. The mortage relief interest deducted at source is only upto 2017? (I think). It was annonced that it would be phased out in last years budget if I'm not mistaken? I think its an important point to notice as normally when someone buys they get 7 years of it but If someone buys in e.g. 2013 they only get the relief upto 2017 or at least thats my understanding of it, I'm open to correction. Its a reason I'm considering holding off on buying to be honest as removing the relief can only drive house prices down further IMO, But that said I'm not sure If I'll wait until 2017 to buy its just something that needs to be considered!

Good point on the BER rating I hadn't considered that initially.

ricman

Stamp duty is now 1 per cent, there are solicitors that do house purchase for 1000 euro,plus vat, google conveyancing fixed rate legal fees ireland.if you are single you can rent rooms out ,rent a room scheme, upto ten k, no tax payable.go to bank,ask about getting mortgages,its not easy to get credit at the moment.