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Buying a house in Ireland?

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  • 08-10-2012 3:56am
    #1
    niamh19841
    Closed Accounts Posts: 26 ✭


    Basically a property at home has come to my attention. We are residents here with the long term aim of living back in Ireland at some stage. I know it is impossible to get a home loan in Aus to buy in Ireland however, I was looking into a personal loan ( bank did not ask for purpose of loan) over 7 years of $50000 ( have been preapproved) to complete my shortfall with an Australian financial institution. Anyone done this before?
    Interested to hear feedback.
    Thanks


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    #2
    Peregrinus
    Registered Users Posts: 26,511 ✭✭✭✭Peregrinus


    If the bank is unconcerned with how you spend the money then it's doable, but it is obviously risky.

    You're going to need to repay the loan over seven years; have you identified the income stream out of which you will do so? I realise that having bought the house in Ireland you may let it out, but bear in mind that your rental income will be in euros while your loan repayments will be in dollars. Over the course of seven years the euro/dollar exchange rate will certainly fluctuate, perhaps quite signficantly, so you need to model this on the assumption that the exchange rate moves badly against you. In that scenario, could you still service the loan?

    You could eliminate this risk if you could borrow euros rather than dollars, but somehow I don't see an Australian bank rushing to make a personal loan in euros to an Australia resident.


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    #3
    jank
    Banned (with Prison Access) Posts: 13,018 ✭✭✭✭jank


    Interest rates are lower at home (I think!) so why not get the loan there and pay it off using your Australia earnings + rental income? Not sure if its feasable but there might be a way around it. There are some great tax breaks for residents who are negatively geared but again I am not sure of the ins and out especially as the property is in Ireland. Best speak to a qualified accountant in this field.


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    #4
    Cooperspale
    Registered Users Posts: 402 ✭✭Cooperspale


    Haven't as it sounds complicated.
    Personal loan rates are 12-14%?? They don't seem to be getting reduced like mortgage rates here at the moment.
    You will need a lot of planning for any shortfall with currency fluctuations/personal income changes, unforseen expenses plus any maintainance of the house at home and the new property tax that the Irish Revenue commissioners are going to be chasing up shortly.

    As for getting money in Ireland, I'd probably give that a miss. Fees and interest rates are increasing constantly and getting a loan is a bit of a nightmare at the moment.

    Doable but lots of foresight and planning needed and as always with property, there is a risk.


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