This week on RTE Radio 1′s ‘Drivetime’ our regular Monday edition of ‘Talking Money’ covered the issue of buying a home. Many first time buyers are starting to feel pushed into the home buyer cohort when they have other options such as renting or buying in a cheaper area, this can make a huge difference and we outlined some of the costs and concerns.
For a while we have seen competition starting to heat up a little in the mortgage market. Several moves recently have started to demonstrate this further, Bank of Ireland have their ‘pay you to borrow from us’ campaign, KBC had a ‘pay you to switch’ along with rates that beat everybody else.
Now they (KBC) have launched a quick approval process which aims to cut down the time it takes to get approved which at it’s worst was taking up to four weeks with some banks. This is only for an approval in principle, which isn’t worth much (not like a loan offer is) but it is the first step in the mortgage process in terms of getting meaningful feedback from a lender.
They have a first time buyer 1yr fixed rate of 3.5%, short term fixed rates are where banks tend to go to attract business as the first year costs are what many buyers are fixated on rightly or wrongly.
There is one bank rumoured to be considering a return to brokerage, another who shut operations considering re-opening …
Sometimes it’s interesting to see how two different papers cover the same story.
Here is the Irish Times talking about how crowds failed to materialise at a property sale in Swords.
And then the Indo follows stating that nearly all of the houses sold.
Granted, they were filed on two different days and the Times couldn’t have known the level of sales, but they did point out the crowds didn’t arrive, the rational deduction being that there was ‘no rush’ to buy the homes. The Indo pointed out that 45 of 53 properties sold, that’s almost 80% of what was available in a day or two.
So is there a rush on for these homes? Yes, because 80% of anything with a price tag of a quarter of a million Euro never sells that quick when we don’t have a supply side issue – something Conor Skehan of the Housing Agency is lording over the mere mortals Read More →
This is a piece that Karl wrote for the Irish Sun, it relates to a piece that was the lead story for the paper last week.
There is a lot of talk that we have a ‘property bubble forming’, with virtually no supply, a growing population and a trend towards smaller households as things like separation and divorce become more common, it simply lacks ‘bubble’ qualifications.
But it does have ‘boom’ written all over it, we have had many such booms and busts in Irish history, I have spent much of the last two years researching just this very thing with Frank Quinn from Blackrock College of Further Education.
We have had many price rises and falls in the last 300 years, often we saw that after a crash the next boom would result in overcrowding because back then, as now, supply became ‘short’ in the areas that it was needed.
A boom is about rapid price appreciation, it doesn’t mean you have a bubble. You could have the price of anything boom and there wouldn’t be a bubble, …
The idea of a ‘catastrophic recovery’ is one where in getting better there are many victims, we feel that’s an appropriate description for the Irish property market as it bounces back.
We were asked to speak to TV3 news about the ECB rate cut yesterday which was rather unexpected. We are now at a point where for some tracker mortgages their interest rate is effectively only made up of the fixed margin over ECB base rate.
We were asked to speak to Clem on KFM radio about the issue of housing shortages and why they happen as well as what can be done about it. We showed that it isn’t just Dublin, that some areas in Kildare are also experiencing the same problem.
This week on ‘Talking Money’ we looked at the ‘cost’ of education. I sometimes say ‘if you think education is expensive try ignorance’ but that doesn’t mean you have to opt for an expensive education. There are trade and professional apprenticeships and other routes to getting highly skilled, and going to university for a lot of people is not the best use of their time, we tried to articulate that while acknowledging the validity and importance of third and fourth level education.