The "New Broke" - SBP Aug 24

‘The rent is only barely covering the interest, and there’s no way we can sell it now,’

If they are covering their mortgage costs they are in a better position than most buy-to-let investors I know who are making up substantial shortfalls every month.

On a similar note…

Had a conversation at the weekend, friend of a friend owns a 2 bed apt…can’t find a tenant…Mortgage repayements are €1400p.m.

(obviously purchased at the height of the madness)

Waiting for a tenant to cover the mortgage and is forking out 1400 each month while waiting!!

Stupider like a fox!

WW, that is great material for a letter! I’ll glean and adapt some of your points (if you don’t object) for my own barrage of letters to media and politicos. There’s probably a post somewhere on the Pin that bullet-points the main objections to a bailout. Could somebody link to it, please?

.

HS, quote away. I’ve been banging the same (tired) drum since I returned here in 2004 after a long career abroad. Imagine how I p1ssed off people back then :slight_smile: But I dont care, its the truth no matter how much its shouted down. We need to beat the cute-hoor cliques that dominate the agenda in is country, as well as educate the honest ones, or we will forever be 2nd rate

Note to all BTL investors surfing the pin

Pin advice generally would be (correct me if I’m wrong )

Sell the gaff as quick as you can and take your loss or whatever profit you can ASAP because it’s only going to get worse and worse .

there is no magic bounce on the way we could be 20 years recovering out of this bubble just like Japan

or

Drop the rent as quick as you can and resign yourself to covering the shortfall for the forseeable future

The former.

The magnitude of losses as prices revert and undershoot the mean will be staggering to most people. I’d rather not say this, I have zero personal vested interest either way, but there it is*

Not only that, but the government in thrall of the vested interests, will, in its wrong-headed attempts to prop it all up with bail outs and more mal-investment, prolong the coming of the end. (Poetic justice maybe?).

Only in the most exceptional of circumstances should people like those in the SBP article ride this out. For the vast majority now holding the bag, the best action is to sell ASAP and repair their personal balance sheets. If they don’t, we’ll see a huge cohort of Irish, over the coming years slowly financially ruining themselves and in turn holding back the broader economy. Sure some of them will end up owning several properties; but so what when the country is a basketcase and the grandkids live in Australia or eastern China. I fear we will do this, out of stubborness and ignorance. What a shame.

*apart from my pride which would love to see us staying wealthy]

I agree

but…

If you can’t get the cash to cover the loss

but still can just about service the debt

most will service the debt

Thus keeping rents down for those who don’t want to use a 40 year mortgage to “buy” a house. :wink: :wink: