Views on price of this house?

leahyl

http://touch.daft.ie/searchsale.daft?id=552129&fr=touch

Have been looking at this for the last few months. Now I certainly couldn't afford it at the current price but it does need a lot of upgrading inside so what do people here think a person could get it for - more importantly what do you think it's really worth? It's a fine house but with the work that needs to be done I think it's really steep price at the mo.

It was 250k up until the end of last year!!

Its just I've heard of houses going for waaaay less than the asking price so I wonder could it be the same here? Mind you I'm in no hurry to buy but at the right price...I'm just keeping an eye out!

Thanks:)

syklops

The first rule of economics: Something is worth whatever someone is willing to pay for it.

How long would you live in it for?

leahyl

syklops wrote: »

The first rule of economics: Something is worth whatever someone is willing to pay for it.

How long would you live in it for?

Well it would be a home for me for a good few years anyway but circumstances may change (ie. I'm single now but may not be in a few years time) - I mean I'm only in the early stages of looking at the moment (on daft and the like) but really I dont have any idea about the property game - haven't even checked to see if I could get a mortgage. This particular house though is in a great area and would be great if I could get it at a better price

I'm just waffling now though!

You're def right about a property being worth whatever someone is willing to pay but I wouldn't know what a realistic offer for this house would be without being too cheeky!!

whippet

depending on condition I would say an offer of 120k -130k would be about right

johndaman66

whippet wrote: »

depending on condition I would say an offer of 120k -130k would be about right

I'd say there or thereabouts is the value of the house (highwater), taking booms and busts out of it, bearing in mind that we are now very much in the latter.

I would guess that the house was built in the 60's or perhaps the early 70's by looking at it. I appreciate that its most likely a solid well built house unlike some of the thinny, and timber frame crap that was built in recent years. However, I feel that to bring the house up to modern standards it could potentially be a bit of a money pit, windows, doors, insulation, dry lining etc etc. For this reason I would absolutely insist on a highly recommended engineer to survey the house (as you should with any house you intend to buy of course) if you are going to pursue it. Also a BER certificate is crucial. I looked at a number of houses a few months back that were on the market without BER certs (which I do believe is illegal). When I mentioned BER cert to one Estate Agent he looked at me like I was an alien for a few seconds, but that's a story for another thread.

Finally before you buy any house or even view any I would recommend a nosey through this website if you have not already done so as its a real eyeopener.To be fair there are some very well informed and objective people on there

johndaman66

To attempt answer your other question leayl;

leahyl wrote: »

Its just I've heard of houses going for waaaay less than the asking price so I wonder could it be the same here?

This will depend very very much on the vedor(s) and their circumstances. Based on my house hunting experiences I have categorized a number of sellers;

There are those who are realistic about selling and have their houses priced accordingly. Most likely mortgage free or very little to pay off on their mortgage would guess More often than not it would seem that these houses actually sell fast enough all the same.

There are those who want to sell but are in denial or whose hands are tied due to Negative equity who I would nearly lump into the same category from a buyers point of view. Any drops in their high asking prices are modest and would seem to be completely overtaken by the falling market. These houses seem to stay advertised for forever and a day. If the listing is dropped it most certainly is not because the house sold.

Then there are the messers, chancers and time wasters. Those chancing their arm or don't really want to sell at all. A lot of these seem to be the POA but some are advertised with a price as I've found from experience.

There are also executor sales and firesales of course. I can't say Ive had any personal experience of either.

Nobody here has the insight to answer your question satisfactorily unless of course the vendor happens to stumble across your thread. The one other thing I will mention is to be weary of stories being bandied about down the pub on a Saturday night as they can be misleading to say the least

the groutch

reminds my of a Dublin suburb I live near.
you'd spend about 25 grand getting it to the standards for living in it long term, so factor that into the price.
I'd say this might sell for about 140k

the_syco

leahyl wrote: »

It was 250k up until the end of last year!!

It's €195,000 now. For €185,000 you could get this.

Try an offer of €90,000. Such an offer could get you this. Is there any reason why you want that particular house?

chicken fingers

the_syco wrote: »

It's €195,000 now. For €185,000 you could get this.

Try an offer of €90,000. Such an offer could get you this. Is there any reason why you want that particular house?

location

leahyl

chicken fingers wrote: »

location

Exactly it's the location - its near the family home and I know the area so that is a selling point in itself. I just want to stress that I'm only looking but I wouldn't want to live in somewhere like Passage West - way too far from the city and Blackpool wouldn't be a desirable location for me either.

This house is so attractive to me I guess because of it's potential.

I'm amazed that 1 or 2 posters suggested I could get the house for 120/130k:eek: Is this realistic??

the_syco

leahyl wrote: »

Exactly it's the location - its near the family home and I know the area so that is a selling point in itself. I just want to stress that I'm only looking but I wouldn't want to live in somewhere like Passage West - way too far from the city and Blackpool wouldn't be a desirable location for me either.

Does the owner of the house know your interest? Because if they do, they'll drive a harder bargain. DO NOT tell teh EA or the owner the reasons why you want the house. They won't lower it: heck, if they're any good, they'll make a "phantom bidder" to push up the price!

whippet

leahyl wrote: »

This house is so attractive to me I guess because of it's potential.

I'm amazed that 1 or 2 posters suggested I could get the house for 120/130k:eek: Is this realistic??

my opinion is where I got that value from. If I was interested in that house that is the max I would offer.

However, as with all offers, it would have to be accepted by the seller. Depending on the seller's situation the offer could be accepted or not.

For instance, if the seller owed 200k on the property (bought it in the last 5 years or so) and does not have the 80k sitting in savings to buy out the negative equity there isn't a hope of you getting the house for it's real value.

as a guide, take the price of a house at it's peak and deduct at least 70% from that value and it would give you an idea of it's current value.

noxqs

Please; The house prices in the last 16 years have been out of touch with reality. You need to stop thinking what it used to cost, because this, like IT Stocks before it - was completely ridiculous.

Those prices will not be seen again in our lifetimes. Ever. Not even close.

Now; A house has always been a terrible investment, as they historically track inflation. Which means with the cost of maintenance, you will always loose money. But that's OK if it's a family home, as housing costs money. That is to be expected.

Now is not the time to buy - simply because there are still too many unanswered questions in regards to the economy - not just Irelands. All of which are very important and will drive down house prices further.

A guideline for a good quality 3 bed semi-d in Dublin should be 2.5x a SINGLE income + a little bit. Which should be around 120k.

It will go down to these levels and probably below - due to compounding effects of low availability of credit and massive surplus/small demand (demoralized buyer base/emigration). Houses won't even begin to go up in price for the next 20 years. So there is nothing to loose by renting a little longer.

Edit: That house, will be way below 120k - the cost to get it up to modern standards would be at least 30K + furnishing. You'd need new white goods as well. 195K minus 20% from asking price is still madness. Absolute madness. Look at what you can buy in the burbs of Berlin for that kind of money, then ask yourself, why should Ireland be special when Germany has a powerhouse economy and a very high standard of living and infrastructure ? Seriously now. Found a 17 bed house in Germany for 200K asking. That's this one:

http://www.daft.ie/searchinternational_sale.daft?id=833017

That's for the entire thing.

The answer is, Ireland is not special. It had a bubble, and a big one at that. And it's still crashing down. But unlike IT stocks, houses take a bit longer due to several factors such as illiquid markets, government intervention, negative equity preventing people from selling etc. etc.

I could go on - but its very hard to make a case for a house like that to be worth anywhere near 100k.

leahyl

noxqs wrote: »

Please; The house prices in the last 16 years have been out of touch with reality. You need to stop thinking what it used to cost, because this, like IT Stocks before it - was completely ridiculous.

Those prices will not be seen again in our lifetimes. Ever. Not even close.

Now; A house has always been a terrible investment, as they historically track inflation. Which means with the cost of maintenance, you will always loose money. But that's OK if it's a family home, as housing costs money. That is to be expected.

Now is not the time to buy - simply because there are still too many unanswered questions in regards to the economy - not just Irelands. All of which are very important and will drive down house prices further.

A guideline for a good quality 3 bed semi-d in Dublin should be 2.5x a SINGLE income + a little bit. Which should be around 120k.

It will go down to these levels and probably below - due to compounding effects of low availability of credit and massive surplus/small demand (demoralized buyer base/emigration). Houses won't even begin to go up in price for the next 20 years. So there is nothing to loose by renting a little longer.

Edit: That house, will be way below 120k - the cost to get it up to modern standards would be at least 30K + furnishing. You'd need new white goods as well. 195K minus 20% from asking price is still madness. Absolute madness. Look at what you can buy in the burbs of Berlin for that kind of money, then ask yourself, why should Ireland be special when Germany has a powerhouse economy and a very high standard of living and infrastructure ? Seriously now. Found a 17 bed house in Germany for 200K asking. That's this one:

http://www.daft.ie/searchinternational_sale.daft?id=833017

That's for the entire thing.

The answer is, Ireland is not special. It had a bubble, and a big one at that. And it's still crashing down. But unlike IT stocks, houses take a bit longer due to several factors such as illiquid markets, government intervention, negative equity preventing people from selling etc. etc.

I could go on - but its very hard to make a case for a house like that to be worth anywhere near 100k.

:eek:wowza! Some post there noxqs! You see this thread shows how peoples opinions vary! Like how do you know when's a good time to buy when one person is telling you you'd be mad to buy now and someone else is saying it's the best time to buy (I mean people in my own life not ye!). My brother is just after buying but to be honest I think he could have gotten a better deal.

If, as you say noxqs, prices are going to go down further then maybe I should hold off! Or maybe I should move to Germany.....

Thanks for all the responses guys

The house prices in general in Cork City and suburbs are absolutely CRAZY anyway. You hear all the economists and the like saying that prices have fallen by some crazy percent - well not in Cork they haven't!

noxqs

Who is saying its a great time to buy? EAs (their job depends on it?). They said that at the peak too.

I don't have a magic crystal ball to look into the future, nor does anyone else, but based on similar bubbles it is quite clear, we are just halfway through the deflationary stage. And, history teach us that prices will NOT go up for decades (Japan it took 30 years to deflate fully, before flatlining (no rise)). So, given that price drops takes along time in housing markets, refer to Japan and prices are unlikely to go up for many years after this, yet unreached, spot. Why buy? It seems like people are trying to catch knives at this point.

I would like to buy too but I am waiting for the following signals in the market:

1. The European debt crisis has a long term plan implemented and actually followed by the countries involved for at least a year.
2. Bond markets stabilize at a reasonable yield.
3. House prices reach a point where they stop dropping but flatline for at least 6 months (+- 0.5% tops).
4. Emigration in Ireland drops - this is critical as many of these would be house buyers. This is literally the FTB housing market, moving away.
5. Ireland commits to a long term plan, for the economy, whatever that may end up being. Wait a bit for the reality to sink in and see how it affects point 2,3,4.

There's no rush to buy, because, prices wont rise for 30 years. And there is no reason to think this bubble was any different than the other bubbles of the last 150 years.

johndaman66

whippet wrote: »

my opinion is where I got that value from. If I was interested in that house that is the max I would offer.

If I may be as bold as to suggest that there is more to the figure you mentioned than just your opinion whippet. It is realistically the value of the house and thats being very generous.

The house would appear to me to be very average (if not in need of modernisation for that matter) in what would seem to be an average part of Cork city (forgive me if I'm incorrect on that assumption and do pull me up on it as I'm not overly familiar with Cork). Hence one could assume that the house is worth 3 to 4 times the average annual wage...This is a much tried and trusted formula for determining what house prices should be in countries throughout the developed world. With the average industrial wage being down to around the €30k p.a. mark these times I believe (for those who have a job) that would seem to suggest that the house is worth €120k max at a push, bearing in mind that you may need to spend a small fortune to bring the house up to modern standards.

You could also apply a rent multiplier. Determine what comparable houses in the area rent for monthly and multiply this figure by 12 and then by 14 to provide a ballpark determination of the value of the house. This formula looks at a house as an investment and considers what the rate of return should be on that investment when determining the market value. To be fair there are only two house advertised on Daft available for rent in Mayfield but applying the formula to both would throw up a figure of between €120k and €130k. Its safe to assume that most would negotiate a lower rent figure with the landlord than that advertised.

Its by no means a coincidence that both formulas lead back to a very similar figure and both would seem to suggest that the house is overpriced. Theres are no doubt many other formaluas out there, some probably even benchmark house prices to the price of a pint! More might suggest that applying formulas to determine house prices is all a bit scientific but I think its difficult to ignore the relevance and practicalities of such.

PARKHEAD67

leahyl wrote: »

http://touch.daft.ie/searchsale.daft?id=552129&fr=touch

Have been looking at this for the last few months. Now I certainly couldn't afford it at the current price but it does need a lot of upgrading inside so what do people here think a person could get it for - more importantly what do you think it's really worth? It's a fine house but with the work that needs to be done I think it's really steep price at the mo.

It was 250k up until the end of last year!!

Its just I've heard of houses going for waaaay less than the asking price so I wonder could it be the same here? Mind you I'm in no hurry to buy but at the right price...I'm just keeping an eye out!

Thanks:)

Ridiculously overpriced.Are they having a laugh?Bide your time.

antiskeptic

leahyl wrote: »

If, as you say noxqs, prices are going to go down further then maybe I should hold off!

If?


If you were to take a look at a graph of Irish-house-price-declines-since-peak, the angle it is currently sloping down at would about the same as the angle of the pitched roof on that house you seem uneconomically keen to purchase.

Now it might be that the steep slope down will go horizontal tomorrow - meaning the bottom has been reached. Or it might do what such slopes are wont to do when they are at that kind of angle...

which is to keep heading down for the forseeable. That means significant declines still likely.



PS: I wouldn't pay anything like that price in Dublin.

leahyl

antiskeptic wrote: »

If?


If you were to take a look at a graph of Irish-house-price-declines-since-peak, the angle it is currently sloping down at would about the same as the angle of the pitched roof on that house you seem uneconomically keen to purchase.

Now it might be that the steep slope down will go horizontal tomorrow - meaning the bottom has been reached. Or it might do what such slopes are wont to do when they are at that kind of angle...

which is to keep heading down for the forseeable. That means significant declines still likely.


PS: I wouldn't pay anything like that price in Dublin.

Ah come on now I wouldn't say I'm 'keen to purchase' it - I've just been keeping an eye on it - doesn't mean I'm in a great rush to buy it! I'm looking at other houses too!

But yeah the general consensus seems to be that this house is way overpriced which I thought it was myself.

In relation to the area (which another poster referred to) - I wouldn't say it's
an average area - the houses around there are well built and this particular area borders Tivoli which would be a much more desirable address. There are parts of Mayfield I wouldn't go near but I am from this general area so I can't say anything bad about the place !

The thing I don't understand is when houses are up for months and months on daft with a ridiculous price (such as this one) and no movement on it (the price) whatsoever. There were other photos up of the bedrooms in this house before, which they subsequently removed, and Christ they were god awful - needed a LOT of work. They're not going to sell it at this rate anyway.

washman3

syklops;72350957]The first rule of economics: Something is worth whatever someone is willing to pay for it.

prefer Ben Dunne's famous theory : something is worth what you get for it when you have to sell it.


dont know if that applies here,wonder what the sellers position is.!!
IMO this house worth no more than 100k,and thats being generous. have been reading many treads on this topic over last 2yrs but must say that the posters on this thread are the most informed and intelligent i've read.
obviously those with the vested intrests have yet to view this tread.
BUT WAIT FOR THEM TO COME OUT FIGHTING.!!!

johndaman66

leahyl wrote: »

In relation to the area (which another poster referred to) - I wouldn't say it's
an average area - the houses around there are well built and this particular area borders Tivoli which would be a much more desirable address. There are parts of Mayfield I wouldn't go near but I am from this general area so I can't say anything bad about the place !

When mentioning that Mayfield would seem to be an average area I wasn't so much discussing the build quality of the houses, rather the social aspect. Your own comment would seem to suggest that overall Mayfield is average, some parts you wouldn't go near and other parts bordering more affluent addresses. To me that would seem to suggest that Mayfield is average overall if you want to look at it one way or the other.

I'm not trying to be smart about it leahyl, I appreciate your from the area too, but I'm just trying to be objective as possible about it.

leahyl wrote: »

The thing I don't understand is when houses are up for months and months on daft with a ridiculous price (such as this one) and no movement on it (the price) whatsoever.

I suppose its the case that some in denial, more are not exactly serious about selling and more are just chancing there arm or indeed a combination thereoff.

theteal

johndaman66 wrote: »

I suppose its the case that some in denial, more are not exactly serious about selling and more are just chancing there arm or indeed a combination thereoff.

Also some of these homes may have been bought relatively recently for really stupid money and now the owners need to sell but can't afford to take the 100+k cut that the house needs to actually move it - they don't realise they'll lose more the longer they hold on to it

leahyl

johndaman66 wrote: »

When mentioning that Mayfield would seem to be an average area I wasn't so much discussing the build quality of the houses, rather the social aspect. Your own comment would seem to suggest that overall Mayfield is average, some parts you wouldn't go near and other parts bordering more affluent addresses. To me that would seem to suggest that Mayfield is average overall if you want to look at it one way or the other.

I'm not trying to be smart about it leahyl, I appreciate your from the area too, but I'm just trying to be objective as possible about it.

Ah I know you're not trying to be smart This particular area of Mayfield though is also referred to as tivoli (but it has always been Mayfield to me;)) and it doesn't have any trouble really - not that i've experienced anyway but certainly other parts of Mayfield are a lot different.

Thanks for your input though

whippet

johndaman66 wrote: »

If I may be as bold as to suggest that there is more to the figure you mentioned than just your opinion whippet. It is realistically the value of the house and thats being very generous.

.

while I accept your theory on how to value as an investment property, I would suggest that there are other factors which will influence the actual value for an owner occupier.

While a base value is 3-4 times the average ind wage (for 3bed semis) you must allow for the fact that houses in areas like this generally are bought by owner occupiers who want to live in the specific area due to family connections and therefore will put a premium on an available house on a specific road rather than paying the 'investment value' on a house a mile away.

Also, I must put in the disclaimer that my value was based on not really knowing the area and basing the value dependent on the house being in reasonable condition.

Ray Palmer

What you should consider is the interest rate you can get. While house prices drop you may actually end up paying more in interest thus costing you more. There are lots of people out there with great deals on their interest rates meaning there house will cost them less than somebody who buys the house for less.

People are often looking at the whole thing very simplistically. Local average wages is more important than national average wage. Hence Dublin house price be calculated at the national average wage is pretty silly way to judge house price. Why you would use a national average wage to calculate an area where the local average wage is much higher just doesn't make sense.

Don't know the Cork areas but is this house in a low,medium or high income area. Use that average wage to calculate the value.

While something is worth what you can sell it for the law of supply on demand trumps it every time. Houses in settled well to do area supply has rapidly declined as people hold on to the property rather than sell. A lot less houses are for sale in areas I travel through and live. I think you can buy a house cheaper than I bought mine but it will cost you more and you have to be earning more to get the mortgage.

chicken fingers

BS. Sorry but interest rates are not rising faster than house prices are dropping.

Ray Palmer

chicken fingers wrote: »

BS. Sorry but interest rates are not rising faster than house prices are dropping.

Never said they were. It is something you need to consider about the cost of a "cheaper" house.

OMD

chicken fingers wrote: »

BS. Sorry but interest rates are not rising faster than house prices are dropping.

It is more for older tracker rates that it is true. I have a 2% (0.75 above ECB) tracker. So if I had 30 years remaining with €300,000 outstanding that would cost €1106 a month.

Interest rates are now about 4% (more than this for PTSB where it is over 5%). So to have the same repayment of €1106 the house price would have to fall to about 30%.

Ray Palmer

OMD wrote: »

It is more for older tracker rates that it is true. I have a 2% (0.75 above ECB) tracker. So if I had 30 years remaining with €300,000 outstanding that would cost €1106 a month.

Interest rates are now about 4% (more than this for PTSB where it is over 5%). So to have the same repayment of €1106 the house price would have to fall to about 30%.

It' also something people who think by waiting they have been very clever. Many don't understand the cost of the purchase means little if the property actually costs them more along with the fact people are years ahead of them when it comes to owning their home. That's ignore rent costs over the years while waiting.

DoesNotCompute

whippet wrote: »

depending on condition I would say an offer of 120k -130k would be about right

+1

The house does not very spacious, and is (possibly) not a new build. Then again it has a garage and a front lawn. There seems to be a passageway to access a back garden as well. I'd pay around 130k - 150k for it, personally.

As mentioned earlier in the thread, a house is only worth whatever you're willing to pay for it.

UDAWINNER

Bad Location,looks in bad order.Wouldn't make more than 50-60k at an auction.