Any Advice

dm012345

First time buyers and currently weighing up our options.

Have about 100k deposit.

Option 1- Buy house for circa €180k and pay the mortgage asap putting about 4k per month towards it.

Option 2- Buy house for circa €500k and pay off over normal 25-30 year period.

Option 3- Sit tight buy a cheap house with a decent yield.

A few things spinning around my head regarding the decision
1-Been first time buyers is there any stamp duty/first time buyers implications that would make either of the above more beneficial?

2-With mortgage been a relatively cheap form of finance would peoples opinion be that you should pay the minimum deposit neccesary to purchase a house and invest the funds elsewhere.

I know there are also lifestyle choices to take into consideration but purely on financials does anyone have any input

djimi

Do you want a €180k house or a €500k house? World of difference between them to be fair!

If you are happy to buy a house in the region of €180k and can afford to put €4k a month into a mortgage then I would say hold off and keep saving. In another 18 months or so you will be in a position to buy without needing a mortgage at all.

dm012345

Thanks for the reply DJIMI,
The 500k house is the ideal and hopefully all roads lead there but would happily live in 180k house for a number of years if it made financial sense. There are obviously a lot of variables here so I realise im not making it too easy for posters to give concise advise, however purely on financials does anyone see a pro or con to either?

telly_lover

dm012345 wrote: »

First time buyers and currently weighing up our options.

Have about 100k deposit.

Option 1- Buy house for circa €180k and pay the mortgage asap putting about 4k per month towards it.

Option 2- Buy house for circa €500k and pay off over normal 25-30 year period.

Option 3- Sit tight buy a cheap house with a decent yield.

A few things spinning around my head regarding the decision
1-Been first time buyers is there any stamp duty/first time buyers implications that would make either of the above more beneficial?

2-With mortgage been a relatively cheap form of finance would peoples opinion be that you should pay the minimum deposit neccesary to purchase a house and invest the funds elsewhere.

I know there are also lifestyle choices to take into consideration but purely on financials does anyone have any input

what location is the house in ?

StillWaters

The main financial is would you get a 400k mortgage? Stam duty is 1% regardless if you are FTB or not. Mortgages are not the cheap finance they once were with the death of trackers.

This is really a lifestyle rather than a finance queation IMO.

Idbatterim

Op do you have a lump sum of cash, where and what type of property are you looking to buy?

killers1

dm012345 wrote: »

First time buyers and currently weighing up our options.

Have about 100k deposit.

Option 1- Buy house for circa €180k and pay the mortgage asap putting about 4k per month towards it.

Option 2- Buy house for circa €500k and pay off over normal 25-30 year period.

Option 3- Sit tight buy a cheap house with a decent yield.

A few things spinning around my head regarding the decision
1-Been first time buyers is there any stamp duty/first time buyers implications that would make either of the above more beneficial?

2-With mortgage been a relatively cheap form of finance would peoples opinion be that you should pay the minimum deposit neccesary to purchase a house and invest the funds elsewhere.

I know there are also lifestyle choices to take into consideration but purely on financials does anyone have any input

The financial variables...

Stamp Duty will be 1% as a first time buyer or a trader upper so that element makes no difference.

Cheapest variable rate for ltv's less than 50% is 2.84% so probably makes sense to borrow at this level when deposit rates are available +4%

The other aspect in relation to the financials is there would be a greater tax relief at source benefit in buying the more expensive property in 2012 bearing in mind the relief is due to be abolished from the end of this year.

As to whether you buy at €180k or €500k now, apart from the TRS factor it's mostly a lifestyle decision as others have said..

dm012345

Thanks killers1, ye the TRS factor is something I will have to investigate further. I would be of the opinion that way down the line there may be more potential for capital appreciation on the type off 500k house i have been looking at as they are slightly unique and could possibly be more of appeal to some buyer than your run of the mill mid terrace suburban dub property, only my opinion obviously.

idbatterim-looking for a property in either west dub or south dub, ye have a lump of just over 100k, looking for a property that has a bit of potential either possibility of extending or refurbishing. Open to any potential options really.

killers1

dm012345 wrote: »

Thanks killers1, ye the TRS factor is something I will have to investigate further. I would be of the opinion that way down the line there may be more potential for capital appreciation on the type off 500k house i have been looking at as they are slightly unique and could possibly be more of appeal to some buyer than your run of the mill mid terrace suburban dub property, only my opinion obviously.

idbatterim-looking for a property in either west dub or south dub, ye have a lump of just over 100k, looking for a property that has a bit of potential either possibility of extending or refurbishing. Open to any potential options really.

TRS on an €80k mortgage is worth around €3,250 to you, TRS on a €400k mortgage is worth approx €16,300...