Buying in Galway City?

I’m looking for advice on whether or not to buy in Galway at the moment. Apologies if this has been asked before, but didn’t find a similar post.

I’ll give some background on myself and my situation first. I’m 23, have a secure job in the army earning around 41k per annum, which should rise to 52k next january(IF promo freeze is lifted) and. I am looking to buy an apartment in Galway as a long term investment. If you asked me a week ago I would have run a mile from the idea. But over the weekend, my father approached me with a very generous offer to part fund an investment in a particular apartment he saw for sale.

I don’t want to give too much detail about the property, out of paronoia that the auctioneer is here checking out prospective buyers thresholds. But, its a two bed modern penthouse apartment overlooking Galway Docklands very close to the city centre, has underground parking. It has two double rooms, one of them en suite. Rents in the area for a similar apartment go for between 800-900 p/m. Renting is usually never a problem for a city centre apartment, and I heard(could be wrong) that rents increased in Galway city last year.

I tried to install the property bee with no success last night, I’ll try again when I get home and edit more detail into this article. But I have heard the peak price for the apartment was 510k. Currently it has an asking price of 290k and if I were to buy it I expect to pay no more than 230k. I would be paying 150k of the price, with my father supplying the rest of the money as a gift.

I realise there is not alot of info here to go on, and have no problem supplying more information, if any needs/wants to know more.

Basically, my father thinks I should definitely go for it, but I don’t want to squander my, or more importantly his, money.

So basically I’m looking for two answers, should I buy now, and what price would be reasonable(I can pm anyone the exact property if they wish)

Any and all opinions would be appreciated, and don’t take it easy on me!

Unless he is willing to buy the house completely then ignore him. No disrespect intended.
This is your call, your name will be on the mortgage and you will be the one liable for the mortgage!

Now is not the time to be buying IMO…
No coutry see property price increases when it’s in a depression!
This isn’t a short term thing and the rewards for holding off and informing yourself via property bee etc will stand to you for the rest of your life!

There is an old saying… never catch a falling knife!

do you think you will be living in the place much? (given that you’re in the army? would you not be off in army camps doing army stuff? … not that i’d have a clue)

if not, then maybe think about saving yer money for a year. it’s a decent wage and if you are gonna be doing army stuff which takes up a lot of your time then you could increase the deposit you have by saving. I doubt prices will be shooting up between now and 2011 so you could take this as a savings opportunity and then see where the market is this time next year.

Thanks for the advice so far. I really appreciate it.

I’ll clarify a few things, that make my particular case unusual. For the next 4-5 years, I will be living in the barracks rent free. I plan to rent the apartment out for 800-900 euro. With some (very rough) back of the envelope calculations, I reckon my mortguage, of 150k over a 20 year term, at an interest rate of 4.75% will result in a monthly mortguage of somewhere in the region of 850-1000p/m. That should see me when you include service charges, taxes and insurance paying in and around 300/400 p/m myself. On top of that I would hope to go overseas at least twice within the next 5 years, each trip will give me about 20k each, which I hope to knock off the principle. I can easily afford that much myself, given I’ll be rent free for the next at least 4 years. After that, I shouldbe earning a sufficient amount to support rent or a second mortguage where I’ll be working(midlands).

Some of the reasons why I think that this particular property will hold its value, and possibly appreciate gradually in the medium term, is its location is unlikely to become anything less than prime and will always attract renters. The docklands is due for a €350m redevelopment(albeit only in the design phase), There is a plot directly across the road which is due for development(again, I can’t see this happening for at least 5 years). If these go ahead, it can only help the price, and if they don’t it still won’t adversely affect the rents.

I also think that I can get a decent price as I have heard the owner is under severe pressure to sell.

The price hasn’t changed on Daft since Nov.

I know, no-one here can tell me what to do, but just want to arm myself with as much knowledge as I can before I make a decision.

Cheers.

My standard reply to all similar posts is that you will be in negetive equity before you complete the contracts. Falling Knife applies to Galway more than anywhere else in Ireland, prices have not moved down as much as other places. Take a stroll around the city centre, count the number of empty shops. Look in the carparks. Once they were full and parking was impossible, now you can drive into mill street caqrpark and park at ease. This town is just on the edge of a major work out. Stay away until that has happened.

As this is an investment purchase I would hold off.
You will not be eligiblelose you FTB exemption and if you are looking to purchase some time in the future this will cost you.
You also have the hassled of having to manage the letting as a renter I’m very happy to see rents continuing to drop and as a landlord I would suspect this wouldn’t be so great. Judging by talk of late of NAMA being used to house people on social housing lists you could find yourself stuck with a previously desirable apartment becoming one less so.
There is also the possibility that interference by NAMA in the rental market could push rents down for private landlords.

Give up on any talk of further development in the future… plans are just that… and it is highly unlikely that any money will be heading in the way of new developments when there is already a massive over hang.

If it was something for yourself and you had a family and were looking to set down roots then the personal circumstances may make some sense. But as an investment you might make more money selling turkeys in January.

BEst of luck anyway and if you get the chance take a few pot shots at that clown O’Dea :wink:

Cheers for the advice gents, its pretty much what I was thinking myself. Glad I came here instead of asking Willie. He’d surely think it would appreciate at least 50% in the next few years given that NAMA is going to be making 10% in the next 10 years! :smiley:

based on yer follow up, i think you might be best to go with this:

Talk to the older cadets in the barracks.

A lot of them have been roasted on property recently.

Ask them what they think about owning a property in Galway and being posted at the far end of the country.

You are a young man, with a good job. Enjoy your twenties, take whatever postings come and save like hell on them. Chad would be good for that I’d say.

Honestly, look at your older colleagues. Ask them about millstones around young necks.

You seem relatively confident of a pay rise next year and the overseas duty. I think that the Army is a prime target for further cut backs. You should be very wary of factoring in money you might make from overseas duty. There is a distinct possibility that the Irish government will want to cut down on its overseas obligations to save further money.

That alone should make you realise what a crazy idea this is!!

Hi there,

Just in case it helps because I know how difficult it is to get ACTUAL selling prices for houses/apartments these days.

We just sold (initial deposit handed over and all looks good to go so fingers crossed) our 3 bed semi in Galway (Knocknacarra) for €240k.

It is a large 3-bed - REALLY good condition, lovely garden, nice estate. The attic is fully converted. We included the contents in the sale, all bedroom, dining and living room furniture. No problems renting out there as its close to town, salthill etc. Rent also between €800-€900 per month.

Might just give you a little insight on what places are actually selling for in Galway these days…

Best of luck with your decision.

Thanks again everyone for your input. Greatly appreciated. I was on the fence on the issue, but I think I got caught up in making a decision too quickly. I think its best to wait at least a year before I make a decsion.

Not too bad, considering you only had to knock 15k off your asking (if I’m looking at the correct listing). Lots more than 6% out there in anecdotal evidence, depending of course on how realistic the original asking price was. Over 6 months to sell though… that’s a lot of bother.

You did very well, 240k for 3 bed semi in knocknacarra - in two years time this will look fantastic. Rents have fallen a lot, now more like 700 - 750 if you can get it rented.