Period house in Dublin 6 - Right time or not???

We recently got 630K mortgage approval from the Bank. Have a 190K deposit and as topic heading suggests we are now in a position to buy our dream house but we are nervous.

We want 4 bedroom house in Dublin 6 preferably Rathgar but are fairly open though we do want a period house with a good garden. These were completely out for our range 3 years ago but have come back a lot and now I think that if we don’t buy soon they may start to creep up again and we’ll have missed our only chance to get the house we want in the area we want.

Our child is 1 and so we have to start thinking about schools etc and really want to be in our own home within the year, we are not in a mad rush but another 12 months is really the longest we can stay where we are due to size etc.

I am concerned that we have been waiting and waiting for prices to go down and now that they have we are almost scared to make such a committment but know that we have to at some stage, is that stage now? I am ranting now but honestly is this a good time to buy in Dublin 6? We have seen a house in Kennilworth park and it’s beautiful but has no parking, small garden and is €850K is this still overpriced, there really is not that much out there so I am getting a bit concerned??

A red brick around there is most likely a money pit.
If you are taking in 200K gross between you, fine. If not, you are potentially stretching. And if you are on that kind of money you would be fucking nuts to buy a house in harolds cross.
There are red bricks in rathgar going for that kind of money.

Kids aint a reason to buy. A home is where the happiness is. Rent where you want to school them.

Thanks for the reply Blackdog.

So seriously if there are decent redbricks in Rathgar village area for our budget where are they? Honestly if one more person tells us that we’ll get a fab house with our budget, the recession etc they simply are not there We have been with every agency and houses either need lots of work, Brigton rd, Brigton Sq, Eaton Sq and they are not actually in the area we really want, a money pit, have no parking or they are too small under 1200 sq ft which is what we have now.

It’s all very well to say home is where the happiness is etc but I want my own home to have the years of happiness in. Sorry if that sounds Irish but we are in our early 30’s, both have great jobs have been holding out for YEARS to buy and we want to move. Is it really sensible to move to D 6 now and rent sure we may just never buy then and keep wasting money on rent, feel like we’ve been renting forever!

We actually got approval for more from the bank so our salaries can well meet €630K which is the most we have decided that we want to go ourselves to give breathing space for when rates go up significantly.

Is Kennilwork PK / Harolds Cross not the best area or just not suitable for families, why would we be mental to buy there? I thought it was lovely but my hunband and I have had a few “discussion on this”. He feels as its right beside Crumlin/Kimmage it’s Way way overpriced but back to my earlier point what else is out there???

:confused: Let’s assume that the house you want to buy would cost 800k (A 3 bed on Brig***h***ton Square for instance). 3 years ago it was asking and getting 1.45 million, so a 650k fall. In that time you have paid about 50k in rent so have ‘saved’ 600k and have not been exposed to the risk of a collapsing property market. I don’t see any reason in the medium term for that trend not to continue (2 years). Do you?

I actually think you should just buy something. Afterall, you can afford to, and you’ve clearly got it into your head that nothing else will do. Best of luck.

€630k Approval
-€190k Deposit


=€440k Mortgage

-€200k Future Depreciation?

Hang onto your cash

Bid low

Very low

They all can’t wait forever to sell

8-

Residential property in Ireland is doing nothing for the next ten years. Inflation adjusted from todays values with a fall off followed by a bounce back is the best case scenario.

History tells us that when bubbles burst they dont reinflate. They stay burst.

Tell the truth, you just joined to the pin to use the homping smiley :wink:

To the op,
Another factor that will impact on these desirable areas is that people simply die off too. Save your cash and have more to spend on a redesign that you really want. Actually pick an area, choose a house you like, get a basic dimensions plan and start working on your design. All the time you planning, prices will continue to fall, occupants will die, forced sales by siblings will happen and materials and labour will get cheaper.

Deep breaths. There, that’s better.

Best of luck.

i just dont know how anyone in their right mind would want to take on a mortgage of 630k

Have educated people with good jobs and the capacity to save diligently
gleaned nothing from the madness, Hubris and stupidity of the last decade.
We are only 2 years into this 10 year long train wreck.

At the moment and in the coming 6 months we will experience a Dead-Cat-Bounce
not necessarily with price but with sales volumes.
People who buy now may feel a little silly in 2 years time.

Please step back from the edge. Please wait at least 18 months.

https://www.youtube.com/watch?v=Ubsd-tWYmZw

To the OP - I completely agree with all the advice you’ve been getting. Think about the forces at work on prices here…

  1. Rental yields are crazily low. And rents are still falling. They’re about 3 to 3.5% for the types of houses you want. Nama and history say they need to go to at least 6%. You won’t believe what you can rent for 1500-1800 euro in really cool areas these days…

  2. The Irish banks are broken. 5 out of 6 loan applications are turned down. Ireland Inc needs to shrink its residential loan portfolio by 50% - so that’s not changing anytime soon. See Morgan Kelly’s papers. Even the state may not be able to fix them.

  3. The equity that was used to pump the bubble is melting. Our self-fufilling property ladder is now working backwards - don’t know what the inverse of a ladder is. Negative equity is culling more and more potential buyers every week. Add in the mass redundancies that’ll hit, for example, the banks later this year.

  4. As I pointed out elsewhere, we just don’t have the population with the big incomes here to support the number of 700K+ houses we have. In 2006, only 21,000 people made >200K in Ireland and probably far less now. Not nearly enough to live in D4/D6/Dalkey/Howth etc . Want to see what Dublin houses should sell for - go look at Birmingham or Glasgow.

There are big and life-changing consequences to getting this wrong. Some of my peers who got it wrong in 2006. Now they’re experiencing downward social mobility (e.g. can’t afford private schools for their children when they had it) and can’t move of places they no longer want to commute from or have outgrown.

The answer to a rental that’s too small or not where you want to be is not necessarily to buy. There’s another alternative :slight_smile:

a snake?

OP: there are houses around garville, coulson rd, frankfort avenue all *asking *around 700/800K.
If you would be happy with one of a few of them, lowball in offers of 400-500K and you might get a bite.

As has been mentioned elsewhere, the schools situation around here can be sticky. Research that too.

The property adder.

Good post Wahoo.

“We want”? Its all about your selfish wants isnt it. You have approval to borrow 630k and you come on a forum expecting free advice. Dont expect any sympathy from me.

Boo hoo hoo. My heart bleeds for you. If you cant afford to live in the snobby area you want, thats not a reason to come on a forum crying about it.

Maybe bide your time close by for €1500 3 bed,2 bath (after a little haggling).
This rent(and falling) would be similar to the interest only part of your mortgage(and rising)
so not throwing money down the drain.
Not a bad spot while you wait and save at least 150-200k.
daft.ie/2861609 Terenure, Dublin 6w
https://mediacache-s3eu.daft.ie/fNrP0FLbrF1pn82y9dovfVlacb8P4S0G9-8G07r6sZptPWRhZnQmZT00MDB4MzAw.jpg

Principal = $630000
Interest Rate = 2.7%
Amortization Period = 30 Years
Starting Month = Jan
Starting Year = 2010++
Monthly Pre-Payment = $0
Annual Pre-Payment = $ 0.00
Your monthly payment will be $ 2555.27
The following mortgage would result for 2010++ :

* Jan: Principal: $ 1137.77   Interest: $ 1417.50   Balance: $ 628862.23  
* Feb: Principal: $ 1140.32   Interest: $ 1414.94   Balance: $ 627721.91  
* Mar: Principal: $ 1142.89   Interest: $ 1412.37   Balance: $ 626579.02  
* Apr: Principal: $ 1145.46   Interest: $ 1409.80   Balance: $ 625433.56  
* May: Principal: $ 1148.04   Interest: $ 1407.23   Balance: $ 624285.52  
* Jun: Principal: $ 1150.62   Interest: $ 1404.64   Balance: $ 623134.89  
* Jul: Principal: $ 1153.21   Interest: $ 1402.05   Balance: $ 621981.68  
* Aug: Principal: $ 1155.81   Interest: $ 1399.46   Balance: $ 620825.88  
* Sep: Principal: $ 1158.41   Interest: $ 1396.86   Balance: $ 619667.47  
* Oct: Principal: $ 1161.01   Interest: $ 1394.25   Balance: $ 618506.46  
* Nov: Principal: $ 1163.63   Interest: $ 1391.64   Balance: $ 617342.83  
* Dec: Principal: $ 1166.24   Interest: $ 1389.02   Balance: $ 616176.59

hoardandsurvive: the class war is alive and kicking! Civility in life and on internet forums is something that we could do with a bit more of…

To the OP: I second the advice given - we are also looking for a period house with garden and can buy outright. We are waiting and watching - I don’t think that there is any question of prices going up. Where do you live at the moment? Definitely consider renting in Rathgar for a year and see if you like it - why commit to a huge mortgage until you know a bit more about the area. Work out your repayments on the mortgage - compare it to the rent and the figures just don’t make sense! We rent in the area we want to buy in, our daughter is in a creche there, when properties come up for sale in the area we can find out a bit about the background from neighbours etc. I have bid on one property recently - offered 50% below asking - someone else bid more and we pulled out, I don’t regret it at all - I know something else will come up! Put in VERY low bids if you are determined to buy now - but I honestly don’t think that you will miss out by waiting. Asking prices can differ dramatically depending on the agent - on who’s selling (executor sales/people who can’t bear to let go of what they think their house is worth etc.) so I’d pay no attention to them - look at the price per square fot, the location, condition of the house etc.

Just my 2c. I’m no expert…

If you compare Irish house prices with house prices abroad (even other countries with similar bubbles), you’ll see Irish property is still overpriced.

If you look at property rental yields (c. 3%, when it should be 6%+ in a “normal” market) you’ll see Irish property is still massively overvalued.

Yes, rent is “dead money”, but any interest you pay on a mortgage (and you would pay a HELL of a lot of interest on a 630k mortgage!) is also “dead money”. You are essentially renting money from the bank, remember.

So with the economy in tatters and no end in sight, I would say rent, rent, rent. For the type of money you’re talking about, you could rent somewhere really nice, with no risk.

Right time or not!!!
I dont think anyone really knows, when the right time is or will be.

A few things we do know is that:

  1. the banks require billions to recapitalise them.
  2. the banks loan books for non-nama loans could be just as bad as the loans going to nama, therefore the banks will be requiring a lot more capital than the amounts that are being bandied around in the press.
  3. Unemployment is set to continue.
  4. For Ireland to become more competitive the cost of living/wages etc has to come down even further.
  5. 5 out of 6 mortgage applications are being rejected.
  6. Houses are still being priced by estate agents/vendors who have no real idea of the value of what they are trying to sell.

Therefore the common conclusion is that prices are set to keep falling for the foreseeable future.

When prices do settle, this increase of prices will not happen as they did in boom times, even though some estate agents like to advise that they will.

My advice would be to wait, however if you find the home you are looking for and you dont think you will be looking to move again, who is to say not to buy if you can afford it - the decision is yours!

For the D6 Redbricks I think even a 3% yield is very optimistic. Its definately alot lower “net” of refurbing it to letable condition, insurance (which is alot for these homes), EA fees etc

Thing is though, Yield based valuations are hard to argue with for new-build apartments/homes which have nothing special about them and can be replicated a 100,000 times over and over again…

The redbricks will always had some unquantifiable premium for rarity value and the fact that they appeal to the artistic side of alot of people. Its not only Irish people that apply this premium…Its the same in well located 100+ year old homes the world over (Paris, London etc), its the same in the art market etc etc
Thing is though…who cares if some wealthy Russian pays 50 million for a painting or bids 300mln for a villa in the Cote D’Azur (yes, that happened!)…they are generally paying for them with money burning a hole in their pockets…
Its when people ‘borrow’ against homes that have little yield that problems arise. Sure there are plenty of people in Ireland who can throw money at these places with no mortgage and not care…but as a previous Topic has highlighted quite well, there are just multiples too many homes for sale in the 650k+ bracket to be justified by the amount of people that are in this category

So if you win the Euromillions who cares what the yield is of the home you are buying. But if you are taking out a mortgage against it, your “security” is the yield that home would provide if pushed to sell it or let it out.

One other thing - when people are doing the math, they should use the longest-term interest rate possible to calculate their likely repayments.

Currently variable rates are around 2.4-2.6%.

However, the best indicator of what you’ll pay in the long run is what the market is currently offering for long-term mortgages. Currently, that is 4.7%. Put that into your montly payments calculator and see what happens.

If you want to accumulate long-term wealth you’re a high-earner, maxing out your PRSA and enjoying ~45% tax relief is a much better and safer option than rolling the nice.