Does the CB realise how the new mortgage rules have effected people

zdragon

11pc it's a decent margin. supermarkets are operating at 4-6% .
It's trendy now to moan about something in the press.

pablo128

CruelCoin wrote: »

http://www.independent.ie/irish-news/surveyors-break-down-the-cost-of-building-a-threebed-semi-d-in-dublin-34726020.html

"According to the report by the Society of Chartered Surveyors Ireland (SCSI), the average cost of building a three bedroom, semi-detached house in the greater Dublin area is €330,000.
The construction costs – or “hard costs” - came to €150,000, amounting to less than half (45pc) of the total cost of building the house.

The remaining €180,000 consists mainly of “soft costs” such as the land and acquisition costs of €57,000 (17pc of total), VAT of €39,000 (12pc) and a margin of €38,000 (11pc)."

Those soft costs total up to €134k, with 46k not accounted for (though i'd place my bets on this being regulatory expenses and social housing provision).

As stands right now, it's simply not commercially viable to build a house in dublin that anyone on the average industrial wage can afford.

The social housing provision needs to be dropped, and a big axe needs to be swung at the legs of the regulatory costs.

Those costs are from a one off build as far as I know. Building a larger number of houses would be a good bit cheaper.

grogi

Angel2016 wrote: »

I was just wondering does the CB and banks in general realise the negative effect the new rules are having on people trying to buy their first home together, do they realise how many people are going to be stuck in the renting sector for alot longer then they hoped?

If it wasn't for the Central Bank, the raise in property prices would stop the purchase anyway... Maybe just a bit later, with much more inflated market and a lot of unhealthy mortgages on books again.

Michael D Not Higgins

pablo128 wrote: »

Those costs are from a one off build as far as I know. Building a larger number of houses would be a good bit cheaper.

This is part of the problem. The institutes that have these figures also have skin in the game and an agenda to push. If they can push the buck to the government they will. I wouldn't take their figures at face value.

It's clear that the Central Bank is doing what it can to regulate the industry and keep a functioning market. If people can't buy homes at the prudential lending rate and the price of new homes is above that average level, then the government needs to step in and address the cost issue and thus the supply side, not the amount someone can borrow or pay for a house.

yqtwqxqm

Its all about competition.
People are competing to buy property. Dinkeys are in the best situation when it comes to spending power.
The CB rules have cut out anyone who didnt have a certain amount of money saved for a deposit.
Those people are all now beavering away to get back in the running.
When they do the competition will be fierce again. Just that many of the people in it will have had to wait a few years to save enough for their entry into the competition.

Muahahaha

Im in support of the CB rules but at the same time I do have sympathy for the OPs situation. Deciding that you are not going to have kids because you dont feel security of tenure in renting is understandable- kids need the stability of the same area/school/friends and renting simply does not give you that option. I think last weeks Housing Plan ignored the rights of renters at a time when they are most needed.

Someone else up the thread mentioned that the CB rules will have a societal effect and its clear from the OP that this is happened to some. Not having kids is a big decision but to feel forced into it when you really do want kids must be horrible.

OP Im not sure which locations you are looking at to buy for €256k but the way I see it right now is you have two options-
1) Rent for the rest of your lives, perhaps not having kids if there is no space
2) Expanding your search to cheaper houses in locations nearby

I know its a stark choice but at the end of the day the rules on security of tenure are not going to change anytime soon and neither is the supply side issue, itll be at least 4-5 years before we see improvements. Its sad and I do feel for you but that is the stark reality of the market right now.

yqtwqxqm

Muahahaha wrote: »

Im in support of the CB rules but at the same time I do have sympathy for the OPs situation. Deciding that you are not going to have kids because you dont feel security of tenure in renting is understandable- kids need the stability of the same area/school/friends and renting simply does not give you that option. I think last weeks Housing Plan ignored the rights of renters at a time when they are most needed.

Someone else up the thread mentioned that the CB rules will have a societal effect and its clear from the OP that this is happened to some. Not having kids is a big decision but to feel forced into it when you really do want kids must be horrible.

OP Im not sure which locations you are looking at to buy for €256k but the way I see it right now is you have two options-
1) Rent for the rest of your lives, perhaps not having kids if there is no space
2) Expanding your search to cheaper houses in locations nearby

I know its a stark choice but at the end of the day the rules on security of tenure are not going to change anytime soon and neither is the supply side issue, itll be at least 4-5 years before we see improvements. Its sad and I do feel for you but that is the stark reality of the market right now.

I think thats an awful choice to have to make. Not to frighten the OP, but I know an IVF consultant very well and they have told me many times how sad it is when couples in their late 30's and early 40's turn up in their clinic needing IVF. People are so unaware of how difficult it is to conceive at that age. And anyone putting off the decision to have children at that age have a long hard road ahead of them to conceive, most actually never being able to have children.
If anyone wants a family please dont put it off on the basis that you will be more settled in a few years. You might miss your chance altogether.
And no matter what anyone says, having a family just works. You dont have to be all set up already when it happens. Its part of the journey of life.

intheclouds

yqtwqxqm wrote: »

I think thats an awful choice to have to make. Not to frighten the OP, but I know an IVF consultant very well and they have told me many times how sad it is when couples in their late 30's and early 40's turn up in their clinic needing IVF. People are so unaware of how difficult it is to conceive at that age. And anyone putting off the decision to have children at that age have a long hard road ahead of them to conceive, most actually never being able to have children.
If anyone wants a family please dont put it off on the basis that you will be more settled in a few years. You might miss your chance altogether.
And no matter what anyone says, having a family just works. You dont have to be all set up already when it happens. Its part of the journey of life.

I know quite a few people who are renting who are also putting families on hold or just not having them.

There is the security aspect but there is also the fact that many apartment complexes are quite simply unsuitable for children. A terrible accident happened in the apartment block where I live when a newborn was in a pram at the top of concrete outside steps and the girl turned to lock her front door and the pram rolled off down two flights of concrete steps, spilling the baby out and the pram fell to pieces. Thankfully the child was unharmed but they moved out shortly afterwards (do not blame them).

Its just not practical to be bringing children plus all the bits they entail etc up outdoor concrete steps.

intheclouds

yqtwqxqm wrote: »

I know for a fact there are ways around the CB rules. Im not inclined to broadcast them as I think the rules are a good thing, but you should be able to find out how to get around them if you look hard enough.

I remember back in boomtime someone telling me that I should use some guy she had used to get a bigger mortgage.

It turned out he was a "broker" who would falsify P60s and other official documents and get people bigger mortgages based on the falsified documents.

I sincerely hope we are not heading back that way.

yqtwqxqm

intheclouds wrote: »

I remember back in boomtime someone telling me that I should use some guy she had used to get a bigger mortgage.

It turned out he was a "broker" who would falsify P60s and other official documents and get people bigger mortgages based on the falsified documents.

I sincerely hope we are not heading back that way.

Of course not.
This way would be something the banks are quite happy to entertain but will not be seen to be steering you that way. You must find out about it yourself and approach the bank. Ive said to much already so I'll leave it at that and wont be mentioning it anymore.

intheclouds

yqtwqxqm wrote: »

Of course not.
This way would be something the banks are quite happy to entertain but will not be seen to be steering you that way. You must find out about it yourself and approach the bank. Ive said to much already so I'll leave it at that and wont be mentioning it anymore.

Do pm me, this could be useful.

_Kaiser_

pablo128 wrote: »

Here's a place in Blanch for 650 a month allowing you to save an extra 600 a month and also transport costs for your husband.

http://www.daft.ie/dublin/apartments-for-rent/blanchardstown/20-erris-square-blanchardstown-dublin-1660308/

Looked at that and thought "that can't be right? €650 a month in Blanch WITH bills included?" But ah wait.. it's sharing with someone, which wouldn't really work for the OP (being married).

_Kaiser_

_Kaiser_ wrote: »

That can't be right? €650 a month in Blanch WITH bills included?

If it's too good to be true..

I was looking at that myself. It's a house share, owner occupied.

Graham

_Kaiser_ wrote: »

That can't be right? €650 a month in Blanch WITH bills included?

If it's too good to be true..

From the middle of the Ad:


one very large double bedroom to let
==/==
This property has a very large spare room which I would like to sub let.

I would guess the advertiser has had several hundred replies from people that haven't read the advert properly.

_Kaiser_

Karsini wrote: »

I was looking at that myself. It's a house share, owner occupied.

Graham wrote: »

From the middle of the Ad:

This property has a very large spare room which I would like to sub let.

Yup spotted that after and edited accordingly.. Pity though - looks like a nice place.

Just spotted that a place which I was looking at went up by 25k today! So I'm priced out again. It's beginning to look like Balbriggan or nothing for me. I just don't fancy the long commute, especially since I'm not driving.

mirrorwall14

The central bank rules are the only things keeping a brake on the market which would be rising rapidly due to lack of supply otherwise. I'm personally affected by them, we got a mortgage of way way less than we would like as they will base it almost entirely on one salary due to lack of full term life insurance on the other person. So despite the fact that we earn enough to get a crazy expensive house we have been capped at about 4.5 times my salary.

BUT (and its a big but) I would not change the rules at all. The only reason there are still houses in our reduced price range is the CB rules. Not much point in giving us more money if the market has outpaced it

CruelCoin

pablo128 wrote: »

Those costs are from a one off build as far as I know. Building a larger number of houses would be a good bit cheaper.

Correct.

That said the figures given do not then include the 10% social housing provision mandated under part V.

The discount from being able to build in bulk would be offset by adding this 10%.

Net result? Not convinced it would be much cheaper.

Michael D Not Higgins

CruelCoin wrote: »

Correct.

That said the figures given do not then include the 10% social housing provision mandated under part V.

The discount from being able to build in bulk would be offset by adding this 10%.

Net result? Not convinced it would be much cheaper.

The developer still gets paid for the social housing (at cost)

um7y1h83ge06nx

I'm really surprised that some people here think that the property market and politics are not linked.

How could they not be? Like most countries economic policies are decided upon by politicians and the Minster for Finance is an elected politician.

Any adjustments to tax rules - whether they be changing to personal tax credits or introducing "section" tax breaks will impact the market. Decisions that will impact FDI or policies around immigration will affect demand.

Ireland (unfortunately in my opinion) has a history of heavy handed governments. But until we have a mantra of "less government is more" the decisions they make will impact markets such as property.

Idbatterim

waiting is good and all of that, if you think prices are OTT. The thing is though, there is no point in waiting and then not being able to take advantage... You need to have enough cash to go it alone or be sure the banks will actually give you the loan...

yqtwqxqm

Maria Unsightly Right-hand wrote: »

I'm really surprised that some people here think that the property market and politics are not linked.

How could they not be? Like most countries economic policies are decided upon by politicians and the Minster for Finance is an elected politician.

Any adjustments to tax rules - whether they be changing to personal tax credits or introducing "section" tax breaks will impact the market. Decisions that will impact FDI or policies around immigration will affect demand.

Ireland (unfortunately in my opinion) has a history of heavy handed governments. But until we have a mantra of "less government is more" the decisions they make will impact markets such as property.

You are 100% correct. Politicians have actually caused all of the problems that we have with the property market right now.

Graham

yqtwqxqm wrote: »

You are 100% correct. Politicians have actually caused all of the problems that we have with the property market right now.

I though it was the banks

or the Germans

or the landlords

yqtwqxqm

Graham wrote: »

I though it was the banks

or the Germans

or the landlords

Go back over all the government interference in the property market for the past 20 years and find one thing they did that hasnt caused disastrous results down the line.

Graham

yqtwqxqm wrote: »

Go back over all the government interference in the property market for the past 20 years and find one thing they did that hasnt caused disastrous results down the line.

Enabling the central bank the freedom to set it's own policy on lending limits?

yqtwqxqm

Graham wrote: »

Enabling the central bank the freedom to set it's own policy on lending limits?

The government actually fought that one so it doesnt count.
It had nothing to do with politicians.
And if you can only come up with that one out of so many acts of interference by them then I rest my case.

Graham

yqtwqxqm wrote: »

And if you can only come up with that one out of so many acts of interference by them then I rest my case.

Can't say that I tried particularly hard it just felt relevant in the context of this thread.

um7y1h83ge06nx

yqtwqxqm wrote: »

You are 100% correct. Politicians have actually caused all of the problems that we have with the property market right now.

I didn't say they caused all the problems or any problems, just that they have the ability, mainly through taxation to affect the market somewhat. They can add or remove spending power from people through direct taxes or offer incentives for people to invest in residential or commercial property. Stamp duty can be changed, so many different things.

pablo128

Maria Unsightly Right-hand wrote: »

I didn't say they caused all the problems or any problems, just that they have the ability, mainly through taxation to affect the market somewhat. They can add or remove spending power from people through direct taxes or offer incentives for people to invest in residential or commercial property. Stamp duty can be changed, so many different things.

Flogging whole apartment blocks to overseas cash investors instead of offering them to the general public doesn't help either.

yqtwqxqm

Maria Unsightly Right-hand wrote: »

I didn't say they caused all the problems or any problems, just that they have the ability, mainly through taxation to affect the market somewhat. They can add or remove spending power from people through direct taxes or offer incentives for people to invest in residential or commercial property. Stamp duty can be changed, so many different things.

Oh yes, I remember 9% stamp duty for an investor.
After that farce that rate had to be looked at again, but the damage was done.
And what about the tax situation now. Tax landlords to death. I believe it was pointed out several years ago in this very forum that the hand in the landlords pocket would just be transferred to the tenants pocket. And look where we are now. Landlords cant make a profit with the taxes they have to pay, so they are passing on the cost of those taxes to the tenants. Well either that or leaving the market, reducing supply.