The silent poverty class

krd

mickeyk wrote: »

To a point I agree with what you are saying here, Ireland needs to get over it's obsession with property, the media drive me insane the way they crack out the champers every time there is some biased report released saying that property is stabilising or is on the rise as If this is something to be happy about.

Yes, because the people who run the media - the higher ups - are property speculating bolloxes who are in deep deep shoysh.

Cheap property is a good thing, I really can't see why this is so hard to grasp.

Cheap property is a wonderful thing - for most people. But, and its people like my parents, who are/were incredibly greedy. They wanted the houses they inherited off their maiden aunts or their own parents to blow them into the millionaire league.

In large parts of the US, people have huge houses, and the mortgages, in comparison to even the prices now here, are low enough that these people can have a really good life, for themselves and their families.

And yes consumer spending is a good thing, but there is a balance to be struck.

Yes...definitely....but, if mortgages are leaving people with only enough income for bare essentials, it's nowhere near a balance. Working families should have enough disposable income to do a family pub lunch once a week. That isn't really that outrageous. Bread/butter/and water, diets will destroy the place much quicker.

Take the couple in the times article, they have a son who now is at the age where he wants to go to college and they clearly have made no provisions for this despite having 18 years or more to plan for it.

It's funny, that a few people I know got the college fund going, within a few days of the child's birth. One (working) single mother I know, she was lodging her child's children's allowance into an account for the child from the word go.

Many private sector workers have no idea how they are going to fund their retirement etc etc.

It'll be suicide or crime, at this stage.

There are families up and down the country who are one unexpected bill away from financial meltdown. Saving for this type of thing is important, and if there is money left over then yes, why not have the meal out or new clothes etc, but only after you are sure you can afford it.

Well, the precarious position they're in, is because they're spending way too much on their mortgage. (now if they had a really low mortgage and they pissed away their money, that's a different thing). There needs to be an income and spending balance. Money spent on mortgages is not circulating in the economy - it's been sucked out like a massive economy destroying bolloxs has huge hoover in his hand.

The only real way out, I see is inflation.

Paying your mortgage is not helping anyone.

Write a letter to your bank

A Cairde

In a bid to save the Irish economy, and save yourself and meself, I have decided to defer my mortgage repayments for the coming year and reallocate the capital to a stimulus program of my own design, to get the economy of this great little nation going.


Over the next 12 months, I will be spending the mortgage money on fags, booze, and bitches.....I may even take up smoking, if I think it will help.


Is Sean Lemass é

Celticfire

mhge wrote: »

I doubt, at least until I start writing letters to IT complaining that I'm poor because I spend more than I'm earning.

Look at you .... you economic genius... :pac:

strandroad

Celticfire wrote: »

Look at you .... you economic genius... :pac:

Never knew that simple budgeting and basic research are signs of genius but it indeed explains a lot if you think so.

Stheno

poeticseraphim wrote: »

They have a liquidity shortage. Which is not poverty.

The people who made financial commitments during the boom have to facilitate them at those valuations as they were made thanks to credit. Obviously those valutations and predicated income were completely incorrect.

You can have a great lifestyle in this economy if you were wise during the boom and you have income.

There house i presume is worth a lot less than they are currently paying back the bank for which means they are losing money. But they have food a nice house etc and heat i presume. That is not poverty. It is fiscal stupidity.


They need professional fiscal management advice. And they need to learn to get more for their money.

This is it for me, the article clearly shows that the basic salary of 51k has been supplemented by years of overtime and allowances and that it now being cut.

They have weekly bills of over €500 though!

“BEFORE WE start”, said the woman from the Money Advice and Budgeting Service (Mabs), “you should know you’re the seventh guard in here in 10 days.” Seated in front of her were a despairing Garda sergeant and his wife. The Mabs adviser was attempting to reassure them that they were not alone.

The payslip is revealing. The health insurance payment to the Garda scheme is €75 a week. The pension-related payments amount to even more.

Some years ago, they prudently joined the Garda credit union’s billpay scheme by which all their bills – including the mortgage – were calculated on a budget plan, and €528 a week deducted at source to pay them (identified as “St Raph BV” on the payslip).


After six years’ service as a sergeant, the basic salary before allowances is €51,084 but clearly, their day-to-day living expenses have come to depend on the allowances and child benefit. Not featured in the payslip is a payment of €500 a month, after tax, to cover unsocial hours. For Colm, this is compensation for six consecutive nights a month of 10-hour duty, plus Saturday and Sunday work.


The picture painted by the Mabs adviser is not quite as cheerful. She calculated the family’s net pay and child benefit total at €807.37. After totting up the mortgage payment and items such as fuel, food, clothing and footwear, education/medical/ transport, bin charges etc, she saw no way of getting their outgoings below €1,100 a week.

avalon68

Celticfire wrote: »

I'm guessing the bank who I'm sure are well stocked with people that studied Economics 101 approved his mortgage and had no reason to expect his wage to be cut.

But hey, hindsight is a great thing...

At the end of the day a bank is a business, out to make a profit. People cant keep blaming banks for their financial problems. Plenty of people didnt take out mortgages, plenty of people turned the banks down when they offered more money. Who honestly can say that they were in a position to get a mortgage if they had to take a 100% or even 110%. If you cant save a deposit, how can you expect to afford payments, or save for a rainy day/something broke fund. I feel 100% should never have been offered, but, clearly there was a market for it and thats why it was offered.

deanlandon

avalon68 wrote: »

At the end of the day a bank is a business, out to make a profit. People cant keep blaming banks for their financial problems. Plenty of people didnt take out mortgages, plenty of people turned the banks down when they offered more money. Who honestly can say that they were in a position to get a mortgage if they had to take a 100% or even 110%. If you cant save a deposit, how can you expect to afford payments, or save for a rainy day/something broke fund. I feel 100% should never have been offered, but, clearly there was a market for it and thats why it was offered.

Fully agree - like icarus, they flew too close to the sun

Idbatterim

It'll be suicide or crime, at this stage.

dont see why, if they have no debt & claim the OAP, they wont be going hungy or cold with it...

Icepick

The Onion would not make this up.

More importantly, how does someone this stupid become a sergeant?

Stheno

Icepick wrote: »

The Onion would not make this up.

More importantly, how does someone this stupid become a sergeant?

If it helps any I took a 36% paycut as a result of the recession, a contract ending and being eager to take an opportunity

It took a lot of adjusting to learn to live with almost forty percent less than I had had.

This guy sounds similiar in that overtime is down, and some allowances are gone, and he doesn't have the latitude I had to adjust as he came to expect overtime and allowances as basic pay.

I've been lucky as I've made up half of that decrease over time and now wonder what to do with the extra money, but losing a chunk of pay in the order of 10%+ can have a significant impact on people.

Celticfire

mhge wrote: »

Never knew that simple budgeting and basic research are signs of genius but it indeed explains a lot if you think so.

Perhaps you should offer your services to MABS, seeing as they can't get the family's budget balanced.

avalon68 wrote: »

At the end of the day a bank is a business, out to make a profit. People cant keep blaming banks for their financial problems. Plenty of people didnt take out mortgages, plenty of people turned the banks down when they offered more money. Who honestly can say that they were in a position to get a mortgage if they had to take a 100% or even 110%. If you cant save a deposit, how can you expect to afford payments, or save for a rainy day/something broke fund. I feel 100% should never have been offered, but, clearly there was a market for it and thats why it was offered.

I didn't blame the bank. He took what he could afford, now his pay is down. What's so hard to understand?

Icepick wrote: »

The Onion would not make this up.

More importantly, how does someone this stupid become a sergeant?

What makes you think he's stupid?

avalon68

Celticfire wrote: »

Perhaps you should offer your services to MABS, seeing as they can't get the family's budget balanced.



I didn't blame the bank. He took what he could afford, now his pay is down. What's so hard to understand?

But he cant afford it now. Clearly there wasnt enough "wiggle room" in his initial calculations/budgeting. And with a salary like that I dont understand why there are no savings built up. That seems insane to me. Also, overtime is not, and should never be considered as part of your basic pay. Its a nice bonus if you can get it, but is not something you can rely on. Frankly that article is poor reporting, and their money has to be going somewhere......but where?

NIMAN

We ain't hearing the full story in this one. Guaranteed.

Celticfire

avalon68 wrote: »

But he cant afford it now. Clearly there wasnt enough "wiggle room" in his initial calculations/budgeting. And with a salary like that I dont understand why there are no savings built up. That seems insane to me. Also, overtime is not, and should never be considered as part of your basic pay. Its a nice bonus if you can get it, but is not something you can rely on. Frankly that article is poor reporting, and their money has to be going somewhere......but where?

How do you know his spouse didn't loose her job a few years ago?
As regards overtime as far as I am aware it was something that could be relied upon before that was also reduced and done away with.

Perhaps there were savings and four years later they're gone..

Stheno

Celticfire wrote: »

How do you know his spouse didn't loose her job a few years ago?
As regards overtime as far as I am aware it was something that could be relied upon before that was also reduced and done away with.

Perhaps there were savings and four years later they're gone..

Yup agree with this, my job I took that huge paycut from, that was basic pay.

It included a guaranteed bonus and various allowable expenses and you became used to them

It took a major adjustment in my thinking and massive cuts in a lot of areas to fit my circumstances when I took that hit.

I've no kids and no dependants, which made it easier.

lmimmfn

dunno what the issue is here( we earn around the same ), the 3 of us( kid is under 2 ) are doing ok on 210euro a week ex bills( and eating quite well at a max cost of 2.50 euro per person per day, half that for the young fella ), i.e. were not eating cornflakes.
That 210euro includes fixing both cars( seems insane but we need 2 cars simply to get to our jobs ), car tax, insurance, NCT, typres, bins, food, food at work for both of us, nappies, baby wipes, toys, has to cover GP visits for the kid( several times we opted not to take the kid to see the GP ).
Roughly:
12% of our costs are petrol
28% on mortgage
15% Childcare( only 3 days a week )
8% gas + electricity
6% extra misc bills - internet/basic tv/1 mobile

The remaining 34% we have for everything else( and saving a tiny bit/very little from the 210euro spend. )

We have degrees and decent jobs( 1 private, 1 public ).
It doesnt bother me anymore, this is the state of the country, its a game of deciding at which point to decide to get fired and go on state benefit.

Were just cruising until the critical point, which will come soon enough, so really for a PAYE employee who cares about working anymore? and of course we'd both get to spend the full day with the little man.

Just as an example i spent 500 euro on GP visits in April for our kid, 140euro on prescriptions( been spending 140euro per month on prescriptions for the past year ), luckly he hasnt had an illness like that since, but how the **** can you afford that $hit working? we even have VHI but its a load of ****, i.e has all sorts of crap terms and conditions( will change it, im just saying )

avalon68

Celticfire wrote: »

How do you know his spouse didn't loose her job a few years ago?
As regards overtime as far as I am aware it was something that could be relied upon before that was also reduced and done away with.

Perhaps there were savings and four years later they're gone..

In a way its irrelevant how they came to be in the situation - they have to deal with it, and if that means downsizing to what they can afford, then thats what they should do. Think of all the people right now who have lost their jobs completely and have a mortgage - how do you think they feel hearing this guy and his wife whinging that a 65000 salary (twice the average wage almost) is poverty. And if they have been relying on savings for 4 years to make ends meet, then they have had ample time to make other arrangements before now.

Hotblack Desiato

Kids eating cornflakes? This time last year the Irish Times ran a 'story' about a kid eating cardboard... so clearly the economy is improving

The cardboard story had zero credibility and this one doesn't either. Forget all the private sector vs. public, and how much a Garda sergeant should or shouldn't be earning, and 'prestigious college' (no fees, and registration fee is the same however 'prestigious' your college is) and all the rest for a minute.
A 1400 euro mortgage is easily manageable on the salary figures given. There is a LOT here we're not being told. e.g. investment properties? holiday home? did they sell their previous place in 2005 (which should have made them a tidy profit at the time) or keep it and let it? did they run up massive lifestyle debts when times were 'good' ? are they paying no private health insurance, a basic plan or a gilt edged plan?

Stheno

avalon68 wrote: »

In a way its irrelevant how they came to be in the situation - they have to deal with it, and if that means downsizing to what they can afford, then thats what they should do. Think of all the people right now who have lost their jobs completely and have a mortgage - how do you think they feel hearing this guy and his wife whinging that a 65000 salary (twice the average wage almost) is poverty. And if they have been relying on savings for 4 years to make ends meet, then they have had ample time to make other arrangements before now.

Imagine being someone with a €1400 mortgage and losing your job?

All of us can do that. Those on the straight and narrow will say that's what mortgage insurance is for.

Those less so will say benefits will cover it, and belated discover it does not as it is very rigid in it's application

Those who never bothered will be fecked.

Everyone needs to adjust, but if you are used to an environment where supplementary payments such as overtime, allowances and bonuses are engrained as guaranteed, it's hard to live that lifestyle, and living appropriately can be a challenge.

Tipp Man

mariaalice wrote: »

People are entirely missing the point its not how cheaply you can feed you family or how to save a bit of money here and there, its about the expectation of a certain life style I am not talking about a sense of entitlement its a lot more complex that that. Its the belief that a middle ranking public servant could have a 4 bedroom house, live in a "good" area afford music lessons for the children, send the children to a good university, have saving and a good pension, or to put it another way have a middle class lifestyle and who knows maybe thats OK and its a legitimate exportation.

This is it in a nutshell

Its all about the lifestyle now

Tipp Man

Celticfire wrote: »

Accident is the operative word. By not following safe working practices accidents happen.

Will you stop

There are more people killed annually on farms than in a couple of decades of gardai being killed on the job

Stheno

Tipp Man wrote: »

Will you stop

There are more people killed annually on farms than in a couple of decades of gardai being killed on the job

In fairness tipp man if you ta

Ie the tragedy that killed three people, they should have known of the risks and not jumped in after the dog?

The gardai face life threatening risk every day

I was dissappointed in the farming forum when I read about another slurry tank death last week and it got no coverage in the forum that I could see.

Supports the "farmers don't care if it happens in the dark hypotothesis" and it's a narrow view you are taking.

Anyway back to the subject on hand, I had a fantastic salary in excess of expectations on here, my contract ended and I got a job at a much lower salary.

I'd to do an exercise to justify that in terms of how my company was PROFITING from what changes I had made and realise that another element was skewing the scale.

I spend on life, critical illness insurance, and pension, it costs a fair whack of my gross (my far less limited gross than before)

I also have health insurance.
I also have basic sky
I also go out with the OH maybe once a week

Unemployed they would all go.

Galwayguy35

Overtime was cut in the place I work in and I'm coming out with about €100 a week less than I was 2 years ago.

Like many others I had to suck it up and adapt to new circumstances.

The woman in the article needs to get real, her husband is in a well paid secure job with a pension at the end of it.

I think if people were looking for an example of someone facing tough times they could have come up with a better example than this.

Gumbo

Tipp Man wrote: »

Will you stop

There are more people killed annually on farms than in a couple of decades of gardai being killed on the job

As sad as those deaths are, most are due to a lapse in health and safety or ignoring it all together in the first place.

Stheno

Galwayguy35 wrote: »

I think if people were looking for an example of someone facing tough times they could have come up with a better example than this.

I actually think it's a good way to challenge the governments ability to meet the requirements of article 44 of the constitution, if you've no time and a lot of of money?

Coming from a similiar pay scale and suffering the cuts I've had It's all relative.

And don't forget, the more PAYE you pay, the more you contribute.

Galwayguy35

kceire wrote: »

As sad as those deaths are, most are due to a lapse in health and safety or ignoring it all together in the first place.

I have to agree, I grew up on a farm and some farmers take chances with their safety unfortunately.

Galwayguy35

Stheno wrote: »

I actually think it's a good way to challenge the governments ability to meet the requirements of article 44 of the constitution, if you've no time and a lot of of money?

Coming from a similiar pay scale and suffering the cuts I've had It's all relative.

And don't forget, the more PAYE you pay, the more you contribute.

Yes I agree that someone like yourself does get hammered on tax but in fairness this guy has about 40 k a year more than me to live on and I have a mortgage as well, sometimes we have to live with the choices we make and noone forces any of us to take out loans or mortgages.

lmimmfn

mariaalice wrote: »

People are entirely missing the point its not how cheaply you can feed you family or how to save a bit of money here and there, its about the expectation of a certain life style I am not talking about a sense of entitlement its a lot more complex that that. Its the belief that a middle ranking public servant could have a 4 bedroom house, live in a "good" area afford music lessons for the children, send the children to a good university, have saving and a good pension, or to put it another way have a middle class lifestyle and who knows maybe thats OK and its a legitimate exportation.

In any proper country a middle income earner should be able to afford the above( decent accomodation for his family, decent education for the kids, a holiday once a year ), unfortunately in ireland a middle income earner has less to pay for everything twice( GP visits at 55/60 euro a whack while paying tax for those who receive it for free ) and has a lower standard of living than those on welfare and who know hoe to work the system.

krd

Tipp Man wrote: »

Will you stop

There are more people killed annually on farms than in a couple of decades of gardai being killed on the job

If a dog is stupid enough, to jump into a slurry pit.....then maybe the world is better off without that stupid dog. ...........And I suppose you could extend that.

Agricultural people are proud of their "no nonsense", "down to earth", intellect. Cock-of-the-walks. Townies are only scum. Dey don't own ferms..de big eejits. Halfof'em are in council houses...Not like geniuses like us, who have big ferms.


Hey, Cowboy........




Do you want to buy a dog?

mariaalice

lmimmfn wrote: »

In any proper country a middle income earner should be able to afford the above( decent accommodation for his family, decent education for the kids, a holiday once a year ), unfortunately in Ireland a middle income earner has less to pay for everything twice( GP visits at 55/60 euro a whack while paying tax for those who receive it for free ) and has a lower standard of living than those on welfare and who know hoe to work the system.

But the family quoted in the article despite having very little cash income when all the bills are paid will always be better off that anyone on long term social welfare because they have a future, a stake in society, overall better health their children will do better in school an so on. These thing have to looked at over the course of life time not a snap shot of particular time.

I have no problem with anyone having any sort of life style as long as they can pay for it. What I have a problem with and I have said this in other threads are the narratives in Irish society around ideas of certain careers = a certain lifestyle I do have some sympathy for the family in the article but it really needs to be asked how they got themselves in to the position they have.

Celticfire

avalon68 wrote: »

In a way its irrelevant how they came to be in the situation - they have to deal with it, and if that means downsizing to what they can afford, then thats what they should do. Think of all the people right now who have lost their jobs completely and have a mortgage - how do you think they feel hearing this guy and his wife whinging that a 65000 salary (twice the average wage almost) is poverty. And if they have been relying on savings for 4 years to make ends meet, then they have had ample time to make other arrangements before now.

So basically no matter what the circumstances, tough.... why didn't you just say that in the beginning and lay your cards on the table ?

So how do you downsize a house if in negative equity and earning less than before?
I'm sure the 83,251 people in mortgage arrears would love to hear your wisdom.

djpbarry

mariaalice wrote: »

...I do have some sympathy for the family in the article but it really needs to be asked how they got themselves in to the position they have.

My thoughts exactly.

The headline grabbed my attention, but the following had me rolling my eyes:

“The couple’s financial problems had been brewing for about seven years, since they bought a well-located but modest, four-bed semi-detached house...”

We’ll overlook for now the fact that the Irish Times considers a well-located (I’m guessing that’s IT lingo for Dun Laoghaire-Rathdown), 4 bedroom house to be “modest” and ask (I’m sure someone else on this thread has already asked) why this well-located property cannot be rented out?

I also couldn’t help notice the contradiction in evidence here:

“Colm and Jean (not their real names) had been floundering for a while. Over several years, Jean had been in contact with this reporter, describing the struggle of people on so-called middle incomes: “We are the silent poverty class. We’re not the kind to ring Joe Duffy or give our names but I’m sure there are thousands like us. There is absolutely no help and no one listening . . .”

So no one is listening to the silent “poverty class”?

There’s more than a whiff of martyrdom about this.

djpbarry

Celticfire wrote: »

So how do you downsize a house if in negative equity and earning less than before?

They're only paying €1,400 per month in mortgage payments - they could easily cover that by renting the place.

SBWife

While it's almost inevitable that the house bought 7 years ago is worth less than the purchase price this does not necessarily equate to negative equity. If they sold a previous home they would have released a significant amount of equity which could have funded part of the purchase price plus they would have reduced the principle portion of the loan somewhat during the past 7 years. Negative equity only comes about when the value of the home is less than the principle remaining on the mortgage.

My take on the situation is that there is either an additional mortgage on a rental property, school fees or significant consumer debt which is not included in the Irish Times narrative.

Tim Robbins

Celticfire wrote: »

So how do you downsize a house if in negative equity and earning less than before?

You are hardly in negative equity if your mortgage repayment for a 4 bed is 1,400 a month.

I'm sure the 83,251 people in mortgage arrears would love to hear your wisdom.

Many of them are investors who are not bothered paying. And many of them were people who were in arrears and are not any more.

The media is full of hype.

Celticfire

Tim Robbins wrote: »

The media is full of hype.

You don't say?

djpbarry

Tim Robbins wrote: »

The media is full of hype.

I must say, I'm becoming increasingly disappointed with the Times. I still think it's one of the better papers in the UK & Ireland, but this kind of “Oh, the poor wee middle classes” narrative seems to be getting louder.

Head The Wall

There's so much that doesn't add up about this story money wise. The way I read it is they bought in 2005, wasn't 2007 the peak?

since they bought a well-located but modest, four-bed semi-detached house with an extra bedroom

Does this mean they bought a five bedroom house or a four bedroom and extended it?

The health insurance costs 3,900 for the year which is compulsory for a guard. They can't choose not to pay it. Considering they get paid 4,000 a year rent allowance I would see this as balancing out. Yes not free health insurance but not far off either. Based on what he is paying it's not too far off what the VHI are charging for 2 adults and 4 kids.


They pay 528 a week to the credit union to pay all the bills which includes the mortgage and this works out at 27456 a year. From that subtract the mortgage (16,800) and they are spending 10,656 on other bills which is 888 a month or 205 a week. There is no explanation for what this is but I presume it at least included Electricity, Phones, Internet, TV, Gas although she does mention in the next line how price rises in gas, petrol and electricity mean that sum doesn't cover it any more. 888 a month seems an awful lot to me for just household bills. Unless you are living excessively of course.

In her long, neat columns of income and outgoings, the family’s “available income” per week came to minus €286.36

According to this last statement they are spending 14,890 more than they can afford to, so yes maths doesn't seem to be a strong point on either their or MABS part. Do MABS not tell people that when they are in financial difficulty that their lifestyle may have to change, it doesn't seem to be the case here.


The article really doesn't go into half enough detail about the deductions because they seem to be many. It sounds like their own fault at this stage and as many have said their mortgage is pretty low, I know couples taking less than half that with the same size mortgage payment, car etc and while it's not easy it is not at the stage these muppets are at.


Hopefully there will be follow up article ala the Kerry cardboard one recently as this has more holes in it than swiss cheese

Sleepy

Head The Wall wrote: »

Does this mean they bought a five bedroom house or a four bedroom and extended it?

I'd say it's an attic conversion that doesn't quite meet the requirements to describe the house as a 5 bed.

If this guy is in poverty, I must be since I earn 15k less a year (not accounting for whatever allowances and OT he does get) and wouldn't have his tax benefits (unmarried so unable to use other half's tax credits). We're far from comfortable but we're keeping our heads above water, have managed a budget foreign holiday in the last two years and while my rent would be cheaper than his mortgage, have been paying back a loan that'd make up the difference. True, we've no savings and a major problem with the car leads to some severe stress but it's hardly feckin' poverty: it's surviving in a recession.

krd

djpbarry wrote: »

We’ll overlook for now the fact that the Irish Times considers a well-located (I’m guessing that’s IT lingo for Dun Laoghaire-Rathdown), 4 bedroom house to be “modest” and ask (I’m sure someone else on this thread has already asked) why this well-located property cannot be rented out?

No, if the mortgage is 1,400, I'm guessing the house cost 250,000. And during the boom times that didn't buy all that much. It wouldn't buy you a house in a posh part of Dublin.

If it's a Celtic Tiger house, those 4 bedrooms will be modest.

And do you think renting out the house will solve anything?

I have friends renting out houses in Dublin for as little as 650 a month.

avalon68

Celticfire wrote: »

So basically no matter what the circumstances, tough.... why didn't you just say that in the beginning and lay your cards on the table ?

So how do you downsize a house if in negative equity and earning less than before?
I'm sure the 83,251 people in mortgage arrears would love to hear your wisdom.

You pressurize for reformed bankruptcy laws, admit you're in over your head and deal with the situation rather than expecting everyone else to sympatise and pay your way into keeping the house you can no longer afford. Sure it's tough....but the fine print in the mortgage contract pointed out....if you can't pay, you lose the house. Though in this case, as pointed out numerous times, that is not a large repayment for someone on 65k. Something is amiss with their story.

djpbarry

krd wrote: »

No, if the mortgage is 1,400, I'm guessing the house cost 250,000.

We have absolutely no idea how much the house cost. How do you know they weren't trading up for example? The husband is apparently over 50, so it seems very unlikely they were first-time buyers.

krd wrote: »

And do you think renting out the house will solve anything?

Well, yeah, of course it will? They rent out the house and move somewhere smaller, thus reducing their expenditure.

krd wrote: »

I have friends renting out houses in Dublin for as little as 650 a month.

Well, if you don't mind, I'll go by the latest Daft rental report for an indication of the going rate in Dublin for a 4-bed house (€1,200 - 2,000).

Robbo

djpbarry wrote: »

We have absolutely no idea how much the house cost. How do you know they weren't trading up for example? The husband is apparently over 50, so it seems very unlikely they were first-time buyers.
Well, yeah, of course it will? They rent out the house and move somewhere smaller, thus reducing their expenditure.
Well, if you don't mind, I'll go by the latest Daft rental report for an indication of the going rate in Dublin for a 4-bed house (€1,200 - 2,000).

Based on the article stating that they paid €36k in Stamp Duty in 2005, and assuming they weren't first time buyers, using the rate of Stamp Duty at the time, I worked it out at a €480k puchase price. YMMV.

As I pointed out on the AH thread on this, from the "details" in the article this means that the bank gave a €480k, 30+ year mortgage to a man who could statutorily retire before half the term was up. Either the banks were far more insane than I thought, or there's more at play here than just a straighforward residential mortgage with standard securities.

djpbarry

Robbo wrote: »

Based on the article stating that they paid €36k in Stamp Duty in 2005...

Ah, yes, I missed that.

Duggys Housemate

Robbo wrote: »

Based on the article stating that they paid €36k in Stamp Duty in 2005, and assuming they weren't first time buyers, using the rate of Stamp Duty at the time, I worked it out at a €480k puchase price. YMMV.

As I pointed out on the AH thread on this, from the "details" in the article this means that the bank gave a €480k, 30+ year mortgage to a man who could statutorily retire before half the term was up. Either the banks were far more insane than I thought, or there's more at play here than just a straighforward residential mortgage with standard securities.

Retirement is not a big issue for the PS. Drop in salary = 30% or so. Still the length of the mortgage is weird.

Duggys Housemate

djpbarry wrote: »

I must say, I'm becoming increasingly disappointed with the Times. I still think it's one of the better papers in the UK & Ireland, but this kind of “Oh, the poor wee middle classes” narrative seems to be getting louder.

Here's a simple thought experiment. Who is poorer

1) a man who declares an income of 10K a year who has 1M in the bank, or
2) a man with an income of 60K with 0 savings, or
3) a man with an income of 5K, with 0 savings or
4) a man with an income of 60K with negative equity of 200K.

1) is the richest. 4) is the poorest.

The poor middle classes in Ireland are hardly a myth.

djpbarry

Duggys Housemate wrote: »

The poor middle classes in Ireland are hardly a myth.

Poverty is generally characterised as being caught in a trap - the couple described in this particular Irish Times piece are in no such circumstances. They clearly have options.

What's stopping them from renting their house and moving somewhere more affordable? They'd be spending less on rent relative to their mortgage and they'd likely be able to reduce their rater considerable outgoings on household bills.

Newaglish

I just don't understand how they're paying €528 on bills per week. That's about €2.1k per month! That's insane. I know where I live is not a 3-bed house, but I still manage with approximately €100 on electricity and then €65ish for TV/internet, €60 for VHI and €60 for my mobile. That comes in at only around €300 per month give or take, where is the other 1.8k going? They must have some crazy health insurance, heating and phone bills to cover that. I'm going to go out on a limb and assume they're paying of a sizeable personal loan or credit card bill every month.

Duggys Housemate

djpbarry wrote: »

Poverty is generally characterised as being caught in a trap - the couple described in this particular Irish Times piece are in no such circumstances. They clearly have options.

What's stopping them from renting their house and moving somewhere more affordable? They'd be spending less on rent relative to their mortgage and they'd likely be able to reduce their rater considerable outgoings on household bills.

you've moved from your general claim - there are no poor middle class people in Ireland - to their specific cases.

djpbarry

Duggys Housemate wrote: »

you've moved from your general claim - there are no poor middle class people in Ireland - to their specific cases.

I never made any such claim - I don't deal in vague definitions. You're putting words in my mouth.

Scofflaw

Duggys Housemate wrote: »

you've moved from your general claim - there are no poor middle class people in Ireland - to their specific cases.

djbarry wrote:

I never made any such claim - I don't deal in vague definitions. You're putting words in my mouth.

Yes, Duggys Housemate appears to have taken up "too much of this poor wee middle classes" as meaning there are no poor middle classes in Ireland, which is a completely incorrect inference from what was said.

Let's hear no more about it.

moderately,
Scofflaw