The Last Word on TodayFM features Irish Mortgage Brokers, 30/04/2020

We were part of a discussion around Covid19 and mortgages on Matt Cooper’s ‘The Last Word’ show on Today FM yesterday. The other participant was Brian Hayes of the Banking and Payments Federation of Ireland.

For our part we were impressed with the fact that the banks have been able to do more than 2,000 mortgage restructures per working day since the pandemic driven mortgage breaks were announced. To put that in perspective, it took six years to do 100,000 restructures after the financial crisis. This time around that figure could be achieved in a little over two months, that is something to be commended.

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Who are Finance Ireland?

We are sometimes asked ‘who are finance Ireland’ because people don’t know the company. In short, they are a broker only lender, this is yet another reason you should never go to a bank directly, they couldn’t tell you about their rates and products if they wanted to and in this instance their prices are amongst the best there is!

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How to buy properties in Bulgaria

Hello my name is Hristo Dimitrov. I’m a student from Varna Bulgaria. I’m new to Irish Mortgage Brokers.

Today my topic is how to buy properties in Bulgaria

 

-First time buyers

When Bulgarian people are buying a home, they have some problems researching the right home for themselves.

They are also not familiar with how to buy a home. They always have problems and some may come across real estate fraud. So I will show you some helpful tips to follow:

Estimate your budget.

It is important to know how much money you are willing to spend on buying an apartment and navigating the cost of housing in your city.

Don’t do it yourself

Get a mortgage. If your own funds are not sufficient but you have a stable income, get a mortgage. Today, banks issue loans for ten to thirty years.

Get ready – wait for a new building.

Primary housing, that is, apartments in new buildings, are, on average, cheaper than second homes. They also have no legal history. And if the developer sells the property, …

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Demand Outweighs Supply: Significant Interest in 500 New Affordable Houses

The Irish Times reports that the County Council of south Dublin has a plan to build 500 new affordable homes. This is the first time a plan has been put in place to build affordable housing in south Dublin for well over a decade. The houses are planned to cost roughly €300,000. Therefore, for first time buyers, in order to purchase, the home buyers would have to place a down payment of €30,000. However, the home buyers could also benefit from the Help to Buy Scheme. Since the home buyers are purchasing affordable housing that is less than 500,000 euro, the first time buyers could receive a tax rebate of 5% of the 300k if the home buyers take out a mortgage of at least 70% of the home’s price. This €15,000 rebate could be very beneficial to most first time home buyers. In addition, the Irish Times predicted that the affordable homes will be 40% less than market price, a significant savings.  

As reported by the Irish times, the homes will be available in three locations. The first time …

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Help To Buy For First Time Buyers

The name provides a definition for itself. First time home buyers are people in the market buying a home for the first time. Compared to other home buyers, such as trader-up borrowers and mortgage switchers, first time buyers have different benefits and restrictions when borrowing than other borrowers. The Central Bank of Ireland requires a 10% down payment for first time buyers. Now, for first time buyers, a 45,000 euro down payment for a 450,000 euro home may be somewhat daunting. However, the Central Bank has offered assistance for their first time buyers to keep them in the market. The Central Bank offers a help to buy program. This benefit allows for first time buyers of new houses and apartments to take a 5% tax rebate off of properties less than 500,000 euros. In a recent case at Irish Mortgage Brokers, a married couple came looking for a mortgage on their first home. The couple did not have a home in mind at the time, but based on their income, the couple had roughly below 500k to spend. Both individuals …

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The Qualified Mortgage Patch

In less than a year, the Consumer Financial Protection Bureau (CFPB) is letting the “Qualified Mortgage Patch” (QM Patch) expire. Why does this matter for first time buyers?

The QM Patch states that mortgage buyers must have a debt-to income ratio less than or equal to 43% in order to buy a home. This rule was created to protect borrowers from racking up too much debt. Removing the QM patch could have drastic effects for the European economy. Let me explain:

I grew up living in the United States during the Mortgage Crisis of 2007. It started with many investors looking for low risk high reward profits. They turned to the housing market to buy those loans. Banks would convert thousands of marketable securities and turn them into shares for investors to buy. They believed the investments were safe because house prices were rising dramatically during this time and credit unions gave many of these securities AAA ratings. AAA rating is the best rating a house can receive.

Investors loved these loans because they were very profitable. They started pushing the …

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Brexit and Help-to-Buy Scheme Provide Uncertainty

Boris Johnson has recently been elected Prime Minister and uncertainties surrounding Brexit are back on the minds of Irish people. The likelihood of there being a no-deal Brexit is strong and the Irish housing market needs to be ready for the consequences. Also, the uncertainty surrounding whether the help-to-buy scheme will be continued or not will have a strong effect on the housing market. The Irish housing market for the rest of this year will depend strongly on the outcomes of the two events listed above.

Lisney published a report recently focusing on the upward trend in the Cork house and construction sectors. Lisney cited Brexit and help-to-buy scheme as two possibilities that may negatively affect the Cork market. Lisney investigated 41 new home schemes being constructed in the Cork area which totals 2,640 units. The help-to-buy scheme is what’s keeping first time buyers able to purchase a home and if this is taken away the number of people seeking homes will decrease. New home sales contribute to approximately 15% of sales in Cork over the last couple of quarters …

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The Future of Help to Buy Scheme

The help to buy scheme is set to be extended past the original deadline of the end of this year. The help to buy scheme grants money to first time buyers to help and encourage them to purchase their first homes. Currently, the grant gives up to 20 million Euros, but the government Finance Minister Paschal Donohoe signaled strongly that this program will be extended.

Mr. Donohoe said that the grant had, “a very valuable role in supporting the purchase of homes across last year and this year in particular.” The rising house prices in Ireland has caused many young buyers unable to attain mortgages to buy a house and this initiative mainly targets younger couples.

Some complaints with having a help to buy scheme is many people view it as being a subsidy to developers. The payment that the government is giving to buyers is subsequently being paid to the developers. This can encourage them to keep prices raised and not provide a decrease in demand causing prices to lower.

Mr. Donohoe is currently consulting with Housing Minister Eoghan …

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Inflation Rates Return to Normal

 

The current housing prices in Dublin have been talked about extensively recently. The newest trend shows that housing prices have reached peak affordability and now some of the wealthy classes of people are having trouble affording homes. Current house prices in Dublin are more than nine times the average salary making them unattainable for the majority of people because mortgages can only be 3.5 times your salary. Additionally, these numbers have not been seen since the Celtic Tiger Era, however, the central bank has been more careful this time and increased borrowing rules unlike during the Celtic Tiger Era. Prices are now beginning to slow down because simply nobody is able to afford them.

Inflation has also cooled off recently with a decrease from 12.4% last May to 2.8% a year later. Dublin has seen a significantly smaller inflation rate with an increase of prices from the current year to May of .6%.

The region of Dublin had the highest median price of 366,000 Euros which is just over 9 times more than its average salary of 40,000 Euros. …

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