Highest offer way over asking price?

jdall

Hi, I'm living here in Dublin since November and starting to look at purchasing property while prices are still down a bit. The areas that I'm looking at are around D1 and Grand Canal dock. I know these are very popular areas but is it truthful when realtors tell me that there are current offers 50k over asking price?? I've looked at a few 2bed apartments on daft in the price range of 180-200 and when I call about them, realtors tell me that the highest offer is 20-50k over asking price, which puts it out of my price range.

Should I believe this or is it a tactic they use to get more?

Is it even possible to find a 2 bed apartment in the D1 area for less than 200k?

Thanks!

djimi

In certain areas of Dublin at the moment its very possible. High demand, low supply. Bidding wars are to be expected.

shamrock2004

I would believe that. I was looking at buying in the north of the city back in November and the estate agent told me that since around September last, he had noticed that people were starting to bid on properties again. He also said that most, if not all of the properties he had sold from September up until the point I was speaking to him, had all been sold over their asking price. Judging by how quickly properties were selling and how quickly rentals were being snapped up, I believe him. It's only going to get worse until more properties are built. Thus, I can't afford to buy and have to rent.

P. Breathnach

It does indeed seem to be happening. A number of properties in which I was interested went well above asking price before I dropped out. In one case the price was €115k over asking price (even though I thought the asking price was on the low side, I didn't think it was anything like €100k on the low side - I thought it might reach about €25k over asking).

I'm stepping back from the market for now. I suspect a mini-bubble exists in parts of Dublin.

Zamboni

P. Breathnach wrote: »

I'm stepping back from the market for now. I suspect a mini-bubble exists in parts of Dublin.

If you don't get on the ladder now you'll miss the boat.
Rent is dead money anyway
Why are you paying someone else mortgage?
If you buy now you will probably be able to flip it for 50k+ in a years or two.

davo10

Zamboni wrote: »

If you don't get on the ladder now you'll miss the boat.
Rent is dead money anyway
Why are you paying someone else mortgage?
If you buy now you will probably be able to flip it for 50k+ in a years or two.

This sounds familiar.

teecee74

Does it have to be an apartment?? Think of the management fees - typically 1500 per year.

€200k would buy this 2 bed townhouse near where I live - despite expectations it's very quiet and mostly hassle free
This one is sale agreed but the middle one is coming up for sale according to the agent for the same price
http://www.myhome.ie/residential/brochure/6-hewardine-terrace-north-city-centre-dublin-1/2736254

Or if you're prepard to walk a little further you could get this renovated 3 bed near Drumcondra
http://www.daft.ie/searchsale.daft?id=727634

rockdrummer4

OMG cant believe its happenng again.. People never learn...

Wasnt so long ago people lost 100's thousands on properties.

F**k demand, if its overpriced its overpriced, leave it at that, you''ll thank yourself later

And for thos who say rent is dead money / paying someone else's mortgage - do ya think paying the bank mostly interest for the first 10 years of the mortgage is money well spent?

Renting has advantages and diadvantages, same as mortgage.. but one thing I would NOT IN A MILLION YEARS buy anywhere I had to pay management fees (biggest joke ever!)

jdall

Thanks for all the replies. It's obvious that the demand is there for now, but I wonder if it will continue on for much longer or if the prices will hit a point where investors start dropping out and leave some to the first timers.

I read an article recently about the banks owning something close to 2000 properties (and growing) in Dublin that have reposed during the recession, but they're not putting them on the market until prices go up more. I guess I can see that going two ways, with the better being that those properties bring down the demand once they actually hit the market..

teecee74: that's a nice townhouse that you posted, but it's right in the area that I'm seeing things go for much higher than asking. How certain are you that a property like that could go for 200k right now? It looks like there is a sale agreed already and the asking was 198k, so I imagine it's selling for 220k at least. I'll take a look anyway because that is exactly the kind of property I'm in the market for.

Cheers

teecee74

Ring the estate agent. I didn't want to put up a link to a house that was sale agreed as that wouldn't be of any interest so I rang GWD (I'm also nosy!). The estate agent said it went for the asking and that the house next door would be coming up soon at the same price - 195 (I was pretending to be looking for a younger brother).

I bought a nearby house from the same estate agents in 2004 and after I bought mine they put up the price of the next one by 10k so if they aren't doing that now I'd say that there's a chance it sold for the asking price at most.

It's not as posh as an apartment in Grand Canal but you're not going to get one of those for your budget. There's a fair bit around - especially if you look at Fairview/Richmond Road - in your budget that's walking distance to town/ close to public transport. I'd say stay away from apartments as for yours to go up in value all 200 have to go up in value, there's always a couple for sale, you can have noisy neighbours above below either side etc.

The 3 townhouses were owned by investors and have been rented out the whole time. You'd probably get 1200/1300 in rent at the moment - maybe even 1400. I don't think you'll double your money in the next six months despite all the talk of a bubble but I don't think you'll lose money at that price, if you had to move and couldn't sell you'd always been able to rent it - lots of people want to be able to walk to work/not have to worry about taxis etc.

The area hasn't really gentrified as I'd hoped but given the budget I had then it was the best fit for me and I have to say it's worked out well for living in. If you have any questions about the area pm me. Just to be clear I have no financial interest in those townhouses.

jdall

Thanks so much for the information. I'll start calling around to see what I can find. I never really considered neighbours when looking at apartments but it's a good thing to point out as that can make or break the living experience for someone.

I'm glad you're happy with your purchase anyway!

Cheers

Larbre34

I don't know why anyone is surprised its happening, its not even what you could call a market

If you're buying in 25.5 counties, fire away and enjoy the value. If you're looking to buy in 'desirable' Dublin, save your money, there is a mini-bubble sustained by a finite supply of cash buyers and investors. It shall burst. The reality of conditions and salaries do not support those prices, 2012 price levels are about right out to 2020

superman28

Some appartments have 2 grand management fees per year, so you live there 10 years and pay 20 grand over to some shady ''management company'' plus water charges plus property tax plus a mortgage.

I agree with Larbre34 it is a bubble of sorts in Dublin, investors and cash rich buyers will run out,, and new building/repossessions will provide more supply in the next 2 years.. a normal market should rise with inflation or there abouts,, yet our property market drops 20% rises 20%, I would resist any nonsense about 'properties running out' or similar,,

I would only buy a property if you think it is good value and worth the money,, property is a long term investment,, thinking about flipping it is a waste of time unless you plan to move out of Dublin,, renting is not dead money in such a unstable market..

jmayo

jdall wrote: »

Hi, I'm living here in Dublin since November and starting to look at purchasing property while prices are still down a bit.

First off what do you mean by "prices are still down a bit" ?
Comparing prices today with those of our peak bubble years 2004-2207 is not a good measure of value.
Everything is down compared to those prices.
Those prices were vastly vastly inflated.

jdall wrote: »

The areas that I'm looking at are around D1 and Grand Canal dock. I know these are very popular areas but is it truthful when realtors tell me that there are current offers 50k over asking price?? I've looked at a few 2bed apartments on daft in the price range of 180-200 and when I call about them, realtors tell me that the highest offer is 20-50k over asking price, which puts it out of my price range.

Should I believe this or is it a tactic they use to get more?

Is it even possible to find a 2 bed apartment in the D1 area for less than 200k?

Thanks!

I presume you are American/Canadian with your references to realtors and I am not sure how truthtful they are in those countries, but over here I would not trust them one inch.

Yes proparty prices in Dublin are up.
House prices are up, and up by a good bit in more desirable areas of Dublin, because most people want to buy a house and not a starter apartment as was happening during the bubble.
I would say the market for apartments is now almost totally investor driven.

BTW if you are only here since November, then why the hell would you want to buy already ?
What is wrong with renting until you really get a feel for the place and then decide ?

jdall

jmayo wrote: »

First off what do you mean by "prices are still down a bit" ?
Comparing prices today with those of our peak bubble years 2004-2207 is not a good measure of value.
Everything is down compared to those prices.
Those prices were vastly vastly inflated.



I presume you are American/Canadian with your references to realtors and I am not sure how truthtful they are in those countries, but over here I would not trust them one inch.

Yes proparty prices in Dublin are up.
House prices are up, and up by a good bit in more desirable areas of Dublin, because most people want to buy a house and not a starter apartment as was happening during the bubble.
I would say the market for apartments is now almost totally investor driven.

BTW if you are only here since November, then why the hell would you want to buy already ?
What is wrong with renting until you really get a feel for the place and then decide ?

Yes, you’re right, I’m American, but wife is Irish so at least one of us has some background knowledge of the areas. Main reason we’re looking to buy now is because we’re ready to buy and although prices are up; we have a feeling that they will continue to rise and we don’t want to wait around to find out the hard way.

I appreciate your feedback though and agree that you’re way better off renting rather than rushing into something. Some people seem to think that owning property is as simple as paying the mortgage rather than the landlord but I know from experience that that is not the case at all.

teecee74

There's a bubble in some areas, not so much in others. None of us have a crystal ball. I linked to 2 properties that are walking distance to town, have good transport links and (crucially I think) are cheaper to buy than to rent. A 20 year mortgage on 170 is around 1k per month. There's no management fees so that's another saving.

In other parts of Dublin it's a different story. I've a friend living in Sandyford. A 4 semi-d went for sale on her road at 365k 2 weeks ago. It's just gone sale agreed at 460k. A 2 bedroom townhouse on the same road has now on sale for 335k. That's nuts. At that price an investor would need to get 2k a month rent which would never happen. For a first time buyer it's very expensive and for now it's much cheaper to rent in the area than to buy at that kind of price.

For the OP, have a think about how long you'd like to live in Dublin. Renting can be great, in the "nice" areas, it's chepaer to rent than buy but (1) that doesn't mean that you're paying cheap rent and (2) it's hard to find somewhere to rent. You're also subject to the landlord deciding to sell the place 3 months into your lease, arguing over deposits, rent increases etc.

Buying somewhere can mean being stuck with a place for the long term. If you've got bad neighbours, you can't move. You'll have to cough up for broken boilers and washing machines. When you need more space you may not be able to sell. You've spent your savings on the deposit.

There's compromises on both sides. Best of luck whatever you decide.

Muahahaha

jdall wrote: »

Thanks so much for the information. I'll start calling around to see what I can find. I never really considered neighbours when looking at apartments but it's a good thing to point out as that can make or break the living experience for someone.

I'm glad you're happy with your purchase anyway!

Cheers

You've hit the nail on the head. Neighbours and the noise from them are a huge consideration when buying an apartment. I'm lucky in my own place in that I've a neighbour above me and one bellow me and nothing to the sides of me. But many apartments are sandwiched together and you can have up to 8 neighbours whose walls touch your walls (3 below, 3 above and one either side). If you have 8 neighbours in close proximity then your chances of a peaceful life diminish considerably.

For many people the reason why they avoid buying apartments is because of the mgmt fees but for me, having lived in apartments for 10+ years the main reason to avoid them is the close proximity to neighbours and the poor sound insulation in the majority of units.

Geuze

superman28 wrote: »

Some appartments have 2 grand management fees per year, so you live there 10 years and pay 20 grand over to some shady ''management company'' plus water charges plus property tax plus a mortgage.

Note that the owners of the units are the members of the management company.


The owners form the mgt company.

If 20 people own the 20 apts in a block, then those same people are members of the mgt company.

These companies are now known as OMCs - owner management companies.

djimi

Muahahaha wrote: »

For many people the reason why they avoid buying apartments is because of the mgmt fees but for me, having lived in apartments for 10+ years the main reason to avoid them is the close proximity to neighbours and the poor sound insulation in the majority of units.

The thing that puts me off buying an apartment is the severely restricted living environment. No way would I pay a couple of hundred grand for something only to be told "sorry you cant put up a Sky dish..."