Central Bank to limit amount banks lend for home purchase

Larry Wildman

assetcolum wrote: »

FTB myself have 100k there but i'll probably need another 20k

I completely agree with your post, well said it's about time these rules came into play

Atleast now the hard working people who saved a deposit won't have to get into a fake bidding war that was mostly driven by credit /greed

How is someone borrowing 90% / 4.5 times their salary (the OECD recommended level) a problem?

Mongfinder General

assetcolum wrote: »

FTB myself have 100k there but i'll probably need another 20k

I completely agree with your post, well said it's about time these rules came into play

Atleast now the hard working people who saved a deposit won't have to get into a fake bidding war that was mostly driven by credit /greed

120k of your money into a 500k house. Taking a chance there don't you think.

handlemaster

assetcolum wrote: »

FTB myself have 100k there but i'll probably need another 20k

I completely agree with your post, well said it's about time these rules came into play

Atleast now the hard working people who saved a deposit won't have to get into a fake bidding war that was mostly driven by credit /greed

It will cool the prices maybe. But back to usual after as people except this as the norm.

ffactj

handlemaster wrote: »

It will cool the prices maybe. But back to usual after as people except this as the norm.

It will cool prices at the expense of the FTB.
Then when FTBs start complaining what its doing to them, expect more interference in an attempt to level the playing field, and then more, and more and then back we go to the boom/bust/interfere merry go round.

assetcolum

Mongfinder General wrote: »

120k of your money into a 500k house. Taking a chance there don't you think.

Not necessarily, for instance if i was to put 120k down payment on a 190-200k house my mortgage would work out at around 400E per month

assetcolum

Larry Wildman wrote: »

How is someone borrowing 90% / 4.5 times their salary (the OECD recommended level) a problem?

The fact that you even have to ask that question after what has happened to this country in the past speaks volumes

Larry Wildman

Picture this scenario, because I know at least four people who it applies to:

- Bought an apartment years ago which is now totally unsuitable for their needs.

- Are being hammered tax-wise because of the 75% interest rule.

- Are being hammered by the exhorbitant cost of childcare.

- Are being hammered with the high rent on a 3 bed semi in South Dublin.

- Are being hammered with tax on their salaries (which are decent).

- Have managed to save €50k/€60k with a view to buying something for around €600k and staying there forever.

What right have the Central Bank got to crush these people's dreams? One fella I know told me his wife was in floods of tears reading about these proposals.

Who is gonna be able to save €120k and live?

This is a licence for investors, landlords and the children of the wealthy to prosper. As usual, the squueezed middle get screwed.

Mongfinder General

assetcolum wrote: »

The fact that you even have to ask that question after what has happened to this country in the past speaks volumes

I borrowed 8 times my salary. 350k on a salary of 45k. I've never missed a payment. The real damage is done in the choice of lifestyle people lead.

El_Dangeroso

Larry Wildman wrote: »

Picture this scenario, because I know at least four people who it applies to:

- Bought an apartment years ago which is now totally unsuitable for their needs.

- Are being hammered tax-wise because of the 75% interest rule.

- Are being hammered by the exhorbitant cost of childcare.

- Are being hammered with the high rent on a 3 bed semi in South Dublin.

- Are being hammered with tax on their salaries (which are decent).

- Have managed to save €50k/€60k with a view to buying something for around €600k and staying there forever.

What right have the Central Bank got to crush these people's dreams? One fella I know told me his wife was in floods of tears reading about these proposals.

Who is gonna be able to save €120k and live?

This is a licence for investors, landlords and the children of the wealthy to prosper. As usual, the squueezed middle get screwed.

Maybe when the proposals come in they won't need 600K to buy a 3 bed semi? (which is utterly insane if you ask me)

Larry Wildman

assetcolum wrote: »

The fact that you even have to ask that question after what has happened to this country in the past speaks volumes

Your post is ludicrous.

The problems of this country were not caused by people getting 90%/4.5 times mortgages.

How exactly are people supposed to come up with a 20% deposit?

Larry Wildman

El_Dangeroso wrote: »

Maybe when the proposals come in they won't need 600K to buy a 3 bed semi? (which is utterly insane if you ask me)

Strawman argument.

I said that the person is renting a 3 bed semi, not that he/she needed €600k to buy one.

assetcolum

Larry Wildman wrote: »

Picture this scenario, because I know at least four people who it applies to:

- Bought an apartment years ago which is now totally unsuitable for their needs.

- Are being hammered tax-wise because of the 75% interest rule.

- Are being hammered by the exhorbitant cost of childcare.

- Are being hammered with the high rent on a 3 bed semi in South Dublin.

- Are being hammered with tax on their salaries (which are decent).

- Have managed to save €50k/€60k with a view to buying something for around €600k and staying there forever.

What right have the Central Bank got to crush these people's dreams? One fella I know told me his wife was in floods of tears reading about these proposals.

Who is gonna be able to save €120k and live?

This is a licence for investors, landlords and the children of the wealthy to prosper. As usual, the squueezed middle get screwed.

I only make 45k per year, 28 years old, Single and have saved 100k

If a couple on decent salaries cannot afford 120k , they need to take a serious look at their expenses or lower their expectations of getting a house for 600k (which they may be insane to begin with to even contemplate paying that much for a house in Ireland)

Seriously if people cannot afford to pay 20% deposit they are simply not worthy of the property , as harsh as that sounds it's with their best interest's in mind

El_Dangeroso

Larry Wildman wrote: »

Strawman argument.

I said that the person is renting a 3 bed semi, not that he/she needed €600k to buy one.

You were the one who mentioned €600K, not me.

Mongfinder General

Larry Wildman wrote: »

Your post is ludicrous.

The problems of this country were not caused by people getting 90%/4.5 times mortgages.

How exactly are people supposed to come up with a 20% deposit?

That's the thing Larry, they're not supposed to come up with. These rules are there to put manners on upstarts from lower and middle income backgrounds trying to better themselves too quickly. I can nearly guarantee you that the people making the rules won't fall victim to them.

assetcolum

Larry Wildman wrote: »

Your post is ludicrous.

The problems of this country were not caused by people getting 90%/4.5 times mortgages.

How exactly are people supposed to come up with a 20% deposit?

Are you actually serious???

I know plenty of people who are single who have saved up 10-30% deposits

Never mind couples for crying out loud

If two people cannot save 20% deposit for a property what on earth possesses them to think that they " should be entitled " to buy it

That's the problem with this country too many people feel it is a giving right to get something they want without actually put in enough effort to get their

Two incomes to save 20% deposit is very achievable imo

bilbot79

It's a bit silly getting into floods of tears over this. Some people don't know what's good for them

assetcolum

bilbot79 wrote: »

It's a bit silly getting into floods of tears over this. Some people don't know what's good for them

Exactly , and they would be the same people who (if sh!t hit the fan) would turn around and blame the banks for allowing them to borrow recklessly

Larry Wildman

El_Dangeroso wrote: »

You were the one who mentioned €600K, not me.

More strawmanning.

I mentioned the rental of a 3 bed semi d and the entirely separate purchase of an entirely different property for €600k.

You've chosen to ignore that or else you're just mistaken.

El_Dangeroso

Larry Wildman wrote: »

More strawmanning.

I mentioned the rental of a 3 bed semi d and the entirely separate purchase of an entirely different property for €600k.

You've chosen to ignore that or else you're just mistaken.

So they want to buy a house for €600K for however many bedrooms, it still means that if they want that property they need to be able to afford to save 20% otherwise they are leveraged up to their necks and can't really afford the property. Simple.

Why do otherwise intelligent people become so stupid when it comes to the biggest purchase of their lives?

Larry Wildman

assetcolum wrote: »

I only make 45k per year, 28 years old, Single and have saved 100k

If a couple on decent salaries cannot afford 120k , they need to take a serious look at their expenses or lower their expectations of getting a house for 600k (which they may be insane to begin with to even contemplate paying that much for a house in Ireland)

Seriously if people cannot afford to pay 20% deposit they are simply not worthy of the property , as harsh as that sounds it's with their best interest's in mind

I don't believe you.

Your take home pay is €2,700 a month.

How exactly have you saved €100k (unless you're living at home).

Greyian

Larry Wildman wrote: »

Picture this scenario, because I know at least four people who it applies to:

- Have managed to save €50k/€60k with a view to buying something for around €600k and staying there forever.

Larry Wildman wrote: »

More strawmanning.

I mentioned the rental of a 3 bed semi d and the entirely separate purchase of an entirely different property for €600k.

You've chosen to ignore that or else you're just mistaken.

You implied these people have saved up with the intention of buying a €600k house. No-one is strawmanning.

Larry Wildman

El_Dangeroso wrote: »

So they want to buy a house for €600K for however many bedrooms, it still means that if they want that property they need to be able to afford to save 20% otherwise they are leveraged up to their necks and can't really afford the property. Simple.

Why do otherwise intelligent people become so stupid when it comes to the biggest purchase of their lives?

One couple in particular are paying rent of €1,800 and saving €1,000 a month.

They have around €60k saved with a view to buying their dream home for circa €600k.

Both have good jobs, neither have ever been unemployed.

Are you seriously suggesting that it's okay to force that couple to rent for another five years?

B..locks. Utter b..locks.

Although, to be fair good candidates like this will probably slot into the 15% who aren't subject to this.

Larry Wildman

Greyian wrote: »

You implied these people have saved up with the intention of buying a €600k house. No-one is strawmanning.

Both you and the person thanking your post are supporting strawmanning.

I'll try and simplify it for you.

- I talked about a couple renting a 3 bed semi and then buying a house for €600k.

- Another poster then said "paying €600k for a 3 bed semi is madness".

I NEVER MENTIONED PAYING €600k FOR A 3 BED SEMI...which part of that do you not get?

Greyian

Larry Wildman wrote: »

One couple in particular are paying rent of €1,800 and saving €1,000 a month.

They have around €60k saved with a view to buying their dream home for circa €600k.

Both have good jobs, neither have ever been unemployed.

Are you seriously suggesting that it's okay to force that couple to rent for another five years?

B..locks. Utter b..locks.

Although, to be fair good candidates like this will probably slot into the 15% who aren't subject to this.

A €540,000 loan over 35 years at 4.0% would have monthly repayments of €2390. If interest rates jumped to 6.0% (which I believe is the stress tests some banks are running, +2% interest), that would jump to €3079 per month, which exceeds their rent + monthly savings. Then there would be added costs associated with owning their own home (e.g. replacing appliances, property tax which would amount to ~€90 per month on a €600,000 home, repairs), so they don't exactly look like great candidates for such a large loan.

Greyian

Larry Wildman wrote: »

Both you and the person thanking your post are supporting strawmanning.

I'll try and simplify it for you.

- I talked about a couple renting a 3 bed semi and then buying a house for €600k.

- Another poster then said "paying €600k for a 3 bed semi is madness".

I NEVER MENTIONED PAYING €600k FOR A 3 BED SEMI...which part of that do you not get?

Paying €600k with a €60k deposit is madness, regardless of house size. They can't adequately afford it if anything changes at all.

chris85

I find it a bit disheartening. I have binding loan offer from bank in place already but if we had to go up get another 10% it would mean living another 2.5-3 years in our boxy 1 bed apartment in order to save (or move much further outside Dublin away from friends/family). We have worked very hard over last number of years to save the money cutting back on a lot and working hard. We both have good jobs and save well and I am not of the view that we all have a right to own a house but I feel we have worked hard, paid our taxes/levies and saved through it to get a good amount of money together for deposit and feel good to be able to repay this ok.

Also so people who were looking at buying will now be forced to rent also and put more pressure on the rental market which would be tough.

How about they get more building happening for properties in Dublin where there is a demand for it but good quality houses in suitable locations with planning for infrastructure and amenities around them. More supply will put less pressure on rental market and also allow more properties for sale.

El_Dangeroso

Larry Wildman wrote: »

Both you and the person thanking your post are supporting strawmanning.

I'll try and simplify it for you.

- I talked about a couple renting a 3 bed semi and then buying a house for €600k.

- Another poster then said "paying €600k for a 3 bed semi is madness".

I NEVER MENTIONED PAYING €600k FOR A 3 BED SEMI...which part of that do you not get?

There's no need to shout. People made the simple assumption that the couple would buy a house similar to what they are renting, a very understandable assumption.

You need to calm down.

ffactj

chris85 wrote: »

I find it a bit disheartening. I have binding loan offer from bank in place already but if we had to go up get another 10% it would mean living another 2.5-3 years in our boxy 1 bed apartment in order to save (or move much further outside Dublin away from friends/family). We have worked very hard over last number of years to save the money cutting back on a lot and working hard. We both have good jobs and save well and I am not of the view that we all have a right to own a house but I feel we have worked hard, paid our taxes/levies and saved through it to get a good amount of money together for deposit and feel good to be able to repay this ok.

Also so people who were looking at buying will now be forced to rent also and put more pressure on the rental market which would be tough.

How about they get more building happening for properties in Dublin where there is a demand for it but good quality houses in suitable locations with planning for infrastructure and amenities around them. More supply will put less pressure on rental market and also allow more properties for sale.

Its exactly people in your situation that this policy would hurt.
So another 2.5 to 3 years saving,
and then how much rent have you paid to your landlord?
How much tax has revenue taken out of that rent?
Has stamp duty gone up in the meantime?

Larry Wildman

chris85 wrote: »

I find it a bit disheartening. I have binding loan offer from bank in place already but if we had to go up get another 10% it would mean living another 2.5-3 years in our boxy 1 bed apartment in order to save (or move much further outside Dublin away from friends/family). We have worked very hard over last number of years to save the money cutting back on a lot and working hard. We both have good jobs and save well and I am not of the view that we all have a right to own a house but I feel we have worked hard, paid our taxes/levies and saved through it to get a good amount of money together for deposit and feel good to be able to repay this ok.

Also so people who were looking at buying will now be forced to rent also and put more pressure on the rental market which would be tough.

How about they get more building happening for properties in Dublin where there is a demand for it but good quality houses in suitable locations with planning for infrastructure and amenities around them. More supply will put less pressure on rental market and also allow more properties for sale.

Real life as opposed to intellectual masturbation by the clowns who caused our economy the collapse (the Central Bank, the Civil Service and the Government).

My heart goes out to you.

These rules are a joke.

Larry Wildman

Greyian wrote: »

A €540,000 loan over 35 years at 4.0% would have monthly repayments of €2390. If interest rates jumped to 6.0% (which I believe is the stress tests some banks are running, +2% interest), that would jump to €3079 per month, which exceeds their rent + monthly savings. Then there would be added costs associated with owning their own home (e.g. replacing appliances, property tax which would amount to ~€90 per month on a €600,000 home, repairs), so they don't exactly look like great candidates for such a large loan.

Interest rates are going down, not up.

They are excellent candidates (and have been told as much).