Should I buy a house?

Martina1991

I'm 27 years old with a salary of around €37,000, no loans and savings of €30,000 (€900 a month).

I currently rent an apartment in Sligo town and have been thinking about buying my first home. I have just been looking at properties on Daft etc. and would ideally like to spend no more than €175k.

Is now a good time to buy?

Any advice on house hunting in general and what to ask and look for when viewing?

TimeToShine

First off congratulations, that is a brilliant amount of savings for your age.

I would personally advise you not get involved in this housing nonsense until absolutely necessary. Take a career break, see the world, work abroad, try some new things and then you can come back to this racket. Unless you are 100% sure you are ready to settle and absolutely afore Sligo then I wouldn't bother. That's just me though

Eric Cartman

if you're buying in sligo and can get something you really like for that money then yeah go for it , brilliant amount of savings and a salary that should allow you to do that. If you want to go travelling etc... you can rent it out.

Caranica

Martina1991 wrote: »

I'm 27 years old with a salary of around €37,000, no loans and savings of €30,000 (€900 a month).

I currently rent an apartment in Sligo town and have been thinking about buying my first home. I have just been looking at properties on Daft etc. and would ideally like to spend no more than €175k.

Is now a good time to buy?

Any advice on house hunting in general and what to ask and look for when viewing?

Unfortunately your budget won't go as far as 175k. It's 3.5 times your salary unless you can get an exemption. Bear in mind you'll need money for legal fees etc so you'll have to trim your budget, around 155-160k is looking like top end

Eric Cartman

Caranica wrote: »

Unfortunately your budget won't go as far as 175k. It's 3.5 times your salary unless you can get an exemption. Bear in mind you'll need money for legal fees etc so you'll have to trim your budget, around 155-160k is looking like top end

OP is saving 900 a month, by the time it was time for closing on a sale they'd be most of the way to 175k

listermint

Keep on saving up into Q2 next year then make your decision. Brexit may have a significant impact here. You could get a cheaper house if not then you'll have more deposit Saved anyway.

Sleeper12

Martina1991 wrote:

Is now a good time to buy?

No one knows that. Some posters are waiting for the next crash. Could be three years away or thirty years away.

The only way to look at buying a home is over your lifetime. So long as you can genuinely afford it now I'd go for it now. House prices traditionally have only moved upwards in Ireland with the exception of 10 years ago. Even if they drop over the first 5 years you will be in profit over the lifespan of the mortgage.

The secret is to be certain that you can make the payments. I don't see this being an issue for you as you seem to be very good with money

Klonker

I think it's good idea if you are happy stay in Sligo long term. You can more than pay the mortgage going by your rent and savings and you could always rent out rooms tax free (under 14k a year).

the_syco

Martina1991 wrote: »

Is now a good time to buy?

How stable is your job?

Idbatterim

Are you paying market rent on the apartment or getting it below market rent ?

yabadabado

How much is your rent per month?

CollyFlower

Yes, I'd buy now if I was you, that's if the bank gives you a mortgage.... As was said by another poster, you can always rent a room, plus with Brexit, we may get an influx of people coming here and things may change, like prices in your area, not only in your area but countrywide.

TimeToShine

I somehow doubt Brexiteers from anywhere will be looking to live in Sligo.

Martina1991

Thanks for all the advice.

My mother is the one that has me thinking about buying a house as renting in her eyes is “dead money”. :rolleyes:

I would like to buy before house prices skyrocket again and I suppose I could rent it out if I did want to travel in the future.

I have a permanent contract in my job, so very stable.
My rent is 580 a month.

I hadn’t thought of Brexit having an impact, but I wouldn’t rule it out. Sligo is only an hour from the North.

Berserker

Martina1991 wrote: »

I hadn’t thought of Brexit having an impact, but I wouldn’t rule it out. Sligo is only an hour from the North.

Brexit will have an impact on the whole island of Ireland. I'd hold off until the next dip in the property market, if I was you. You have a really good chunk of cash saved and no immediate need to purchase a property.

Do you plan on living in Sligo long term? I know people who purchased homes in Sligo and they were forced to relocate for work reasons. They ended up paying a mortgage on a home in Sligo and rent elsewhere. They tried to rent it out but it proved to be a nightmare. They spent their weekends travelling up and back from Sligo trying to get the rent they were owed. Ended up leaving it empty and paying the mortgage, as I said above.

B-D-P--

If you can afford to buy now do.

Lets say average rent is 600pm
If you dont buy now and buy next year instead the same house could be worth the same, but essentially you'll have lost out €7200 in rent.
You could look at it that the house is now 7k more expensive.
Or you could look at it that you've lost 1 year in repayments to the bank.

Its not about will house prices change, look at it more, Will I be happy in what I can afford?

CeilingFly

Mortgage will cost you about €800 a month - based on 140k over 20 years. I'd always use 20 years as a guide to value.

Prices are stabilising, so there's no rush.


But always think the day you buy is the day you sell - so add in selling costs of about €5,000 (agent & legal fees) + buying costs of about €2,000 giving a total of €7,000. (that's "dead" money)

If you were committed to the property for a minimum of 5 years, then you are getting into the area of it beinga good option.

Remember add in property tax, insurance & maintenance costs in your calculations.



Overall, you have a good rent, but also good savings. But if a property you really liked in an area you really like came on the market, I'd look at proceeding.

TitianGerm

Martina1991 wrote: »

Thanks for all the advice.

My mother is the one that has me thinking about buying a house as renting in her eyes is “dead money”. :rolleyes:

I would like to buy before house prices skyrocket again and I suppose I could rent it out if I did want to travel in the future.

I have a permanent contract in my job, so very stable.
My rent is 580 a month.

I hadn’t thought of Brexit having an impact, but I wouldn’t rule it out. Sligo is only an hour from the North.

You could buy now and rent a room an earn €14000 a year tax free. That would go a long way to paying your mortgage until you want to live alone and settle down.

lostcat

TitianGerm wrote: »

You could buy now and rent a room an earn €14000 a year tax free. That would go a long way to paying your mortgage until you want to live alone and settle down.

It would want to be one hell of a room to approach 14k per annum in Sligo :eek:

GingerLily

lostcat wrote: »

It would want to be one hell of a room to approach 14k per annum in Sligo :eek:

Two rooms might fetch 500/600 each a month, so if the OP buys a property with 3 plus rooms she's not far off it.

TitianGerm

lostcat wrote: »

It would want to be one hell of a room to approach 14k per annum in Sligo :eek:

Doesn't have to be one room.

nim1bdeh38l2cw

Caranica wrote: »

Unfortunately your budget won't go as far as 175k. It's 3.5 times your salary unless you can get an exemption. Bear in mind you'll need money for legal fees etc so you'll have to trim your budget, around 155-160k is looking like top end

175-37 = 138
37x3.5 = 129.5

Shortfall = 8.5 which they'll have saved in jig time, even without an exemption.

daheff

Sleeper12 wrote: »

No one knows that. Some posters are waiting for the next crash. Could be three years away or thirty years away.

Berserker wrote: »

I'd hold off until the next dip in the property market, if I was you. .

The thing is nobody knows when the next dip is going to happen. We were going gangbusters back in 2004-06. Then lehmans went bust and the house of cards around it started falling down. Loads of jobs lost & property market fell apart.

Key thing is though that prices dropped and banks didnt want to loan to people unless they felt there was enough equity in the purchase to buffer any further drop in prices. So waiting for the next property bust may mean you aren't able to buy still.


As another poster pointed out, the money you spend in rent now waiting for a bust could be money spent paying off your mortgage (ie into your pocket rather than your landlord). Other side of that question is are you buying at an unsustainable high price? What would the price of the house be in 10 years (or about half way through your mortgage)?


Work out your figures -your guess on price now vs later is as good as the rest of us.


Personally I think its a no brainer to buy a house if you can afford it. Buy the biggest house you can afford /maintain. Buy with a view to living there for the rest of your life, with kids,pets, cars, suits your lifestyle,your work etc.

One of the mistakes people made in the last boom was buying to 'get on the ladder'. a lot ended up buying unsuitable 1 or 2 bed apartments with horrendous commutes...just to get on the ladder. Up until last year most probably were stuck in these places , with families now they didnt have when they bought.