Starter home?

greyhound87

Hi all,

Like others here have been looking for a first house for the past year or more. Looking in the west and the supply is grim and getting worse. Our state of affairs is that we have around ~450k in total savings and around 130k in combined salary.

As there have been very few detatched houses up in the area we are looking, we are now toying with the idea of buying a semi-d with cash and then either waiting for a house to come up or building. This is to basically start somewhere and stop paying rent.

• Buy a cheap semi-d in cash (~300). Wait for a nice detatched house to come up. Timescale two years?
• Same as above but buy the semi-d in one name and wait for a decent site and build a house. (One of us could build house in rural area around 30km from big town, that or a residential site in big town.)

I know the idea is to build equity in something but the issue obviously is that if semi d house increases by 15% over X period, then that nice detatched also increases by ~15%. I suppose we would have saved a bit in the meantime but not much if it would be a year or two. Also the extra fees presumably would wipe out any gain unless it was a large gain.

NIMAN

You have 450k in savings and able to get an additional 500k in a mortgage, but can't find a suitable house?

If that's genuine, this country really is fecked.

Whereabouts are you hoping to live?

greyhound87

https://www.boards.ie/discussion/comment/122324576#Comment_122324576

Hoping to live in Clare.

Sorry you are absolutely correct. We can indeed get a large mortgage and pay huge money for a house and in theory and could buy a house worth 800k if we wanted I suppose. The very odd house that comes up goes crazy in bidding and just goes way beyond any reasonable value in my eyes. Obviously this then is a huge risk if the bottom falls out of everything. If it was Dublin city I would be far more comfortable spending extremely large money as that location will always hold some relative value. That's why we could buy a cheap semid and wait for more to come on the market. More than one house every couple of months sort of thing. Is it ever advisable to buy and sell a house within a year or two?

Smee_Again

https://www.boards.ie/discussion/comment/122324609#Comment_122324609

If you're worried about risk or house prices falling then surely buying 2 houses in the same area isn't a great idea.

I'm in a "starter home" now and looking to trade up and a few sellers have picked cash buyers over me because they don't want to deal with a chain. Just something to be aware of.

witchgirl26

OP I think the idea of a starter home used to be great but now, it's more a case of buy a home you'll be in happy in for the mid to long terms because you could end up stuck there.

Genuinely, if you find a home that you think you could make your almost forever home, stop worrying about the equity that you might get in it & go for it. Having done a quick look on myhome.ie there are a couple of mad priced places in Clare but one of them does have it's own massive swimming pool & helipad. The other is obviously a former hotel/B&B because it has more than 10 bedrooms.

Find an area you like, find a house you think you could make your own & determine how much you're ok with spending on it.

Furze99

https://www.boards.ie/discussion/comment/122324609#Comment_122324609

Well you have a substantial amount of finance - you must surely be able to buy a decent detached house in Clare for €450K. So it must come down to area, you're looking in places where everyone wants? But you don't want to commit too much as you fear the market crashing? Same could happen to a 'starter house'. Doesn't the usual advice apply - if you see a place that will suit you for many years, pay the price - it's a home you buy not just an asset. Otherwise if not in a rush, wait till prices fall. It's not going to go on like this just rising and rising as ultimately houses must be sold to individuals who can afford them.

Mrs OBumble

https://www.boards.ie/discussion/comment/122324576#Comment_122324576

The trend to WFH has had consequences in a number of areas.

OP if you are up for the challenge of a building project, that's the way I'd go.

NIMAN

I just had a quick look, and property prices are higher than I imagined in Co Clare.

Appears 250k doesn't buy much there.

As for buying and selling often, personally that would fill me with dread. Moving house is a pain, not even including all the paperwork and legal side of things.

greyhound87

https://www.boards.ie/discussion/comment/122324858#Comment_122324858

250k doesn't really buy anything unless you are very rural. As MrsObumble says, WFH is what has changed everything.

This went sale agreed recently for example. Granted its quite big but its well outside the town and it went from 485 to something like 740.

https://www.daft.ie/for-sale/detached-house-ballymaquiggin-ennis-co-clare/5698685

greyhound87

https://www.boards.ie/discussion/comment/122324795#Comment_122324795

Yes, you might be right there. That is an option as my partner is from the coast.

As you foreshadowed though, if the WFH bubble burts then its the guts of an hour commute to the likes of Limerick.

Kurooi

You want a detached house, but don't want to pay the premium on a detached house. You have the money, if you don't like their prices you won't like them any more in the future either. Detached homes will always be more popular and will always attract more bidders.

As for starter home then trading up, consider where at life you're at. If you're young starting off starter homes are a great idea. If you're older, got kids or starting to settle - not so great you're uprooting them and the mortgage terms get shorter for you. If you have the funds already it makes sense to buy once and proper, you will be more comfortable to invest time and money into it.

Bass Reeves

One off houses in the country are really starting to up in value over the last 12 months. There is a few reasons, Increasing cost of building. Another factor is now with any 3 bed semi nearly above 300k+ it allow people to move from these with significant equity if they are there 10+ years.

I woukd be as afraid that they would get more expensive that prices would crash