RTE Primetime featurs Irish Mortgage Brokers

We were asked to take part in an interview on Primetime about house prices and whether or not they were starting to show signs of falling. Our view is that they will fall in time (probably in a damaging way) but that it won’t be soon because supply is still above demand and price indicators like rents are still rising. This is damaging for first time buyers and those stuck paying high rents.

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Is the Housing Gap Increasing?

With an attempt to lift the housing market out of the current crisis it’s in, the Irish government is left to answer one very important question. Is the Help to Buy scheme even helping?

Or…is it worsening the gap of the home hunters who are looking for the ability to buy?

As what is already well known, house prices are soaring. Without the supply of housing increasing at any fast rate, this will continue to be the case.

Therefore, home prices are continuing to rise, much faster than incomes are rising, and the gap between available homes and affordable homes is continuing to worsen.

When looking at reports from CSO, the average wage in Ireland is €45,075 for a full-time employee. That number is, however, much lower as a median, where most of the working class clusters. The median is found at €28,500. A drastic difference and even more of a surprise when finding that, that means, nearly half the population is below that number.

This is where the Help to Buy scheme comes into play.

Introduced just earlier this …

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Renting Becoming Impossible

Renting in Ireland is an extraordinary and surprisingly busy sector to be involved in.  A sector that is shrinking at an exceptional rate. But only by individual growing…not by choice.

Recent surveys actually show that the number of available rental properties are at the lowest they have been in recorded history, while at the same time, less than one-third of people renting their homes are renting by choice.

The majority of individuals in rental properties are in it because they either can not afford the mortgage on available homes or have been denied social housing.

Renting is at best, the third choice.

The burden on individuals and families of paying rent also causes for a demanding financial pressure to be put on these renters as ⅓-½ of their paycheck is often seen taken by rent expenses.

Making it a difficulty for individuals to even get into the renting sector as a large portion of their income will essentially be given up.

However, it’s even increasingly difficult for someone looking to branch out of the renting sector to save the allocated …

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Intriguing Statistics of First-Time Buyers

Perfect Property has recently found success in finding the common budget of the average house hunter in Dublin.

While in such a crisis, this is information that has been found is essentially vital in understanding a piece to the puzzle of what keeps buyers from buying.

Of course, there are statistics on the shortage of homes compared to the increasing demand, a factor into understanding the crisis that is just as vital.

According to Perfect Property, a relatively new search engine, the average Dublin house hunter has a budget of €315,000 to purchase a home with.

A pretty substantial budget for any home buyer, however, we are still observing a vast amount of first-time buyers applying for the new state mortgage scheme, introduced just a few months prior.

A scheme that was expected to cover nearly 1,000 loans and last for an extended period of time is now lucky if it lasts the full year.

Of course, when looking in the Dublin area it can be expected that the budget for a home will …

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Affordable Home Schemes

With the current housing crisis in the midst of the country, many plans have been developed to get the country out of its current slump. Some merely get laughed at, while others are well on their way to implementation within the housing market. It is likely that before long these effects will take a toll in the market and we will begin to see some upward movement in home buyer confidence.

The government has been quick to release multiple initiatives set out with the goal to turn the crisis around and allow the market to begin looking up. The Home Loan Scheme recently announced by the government is designed with the strategic plan to provide low-cost mortgages to first time home buyers.

With the first announcement of such a plan, many home buyers are thinking; is this too good to be true? As they have been waiting for an extended period of time for some light to be shed on the crisis that allows them to finally move into the homeowner sector.

The Rebuilding Ireland Home Loan …

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The Slow Fall of Housing Prices

With the rising prices in the Ireland housing market continuing on their steep journey up, buyers in the market are slowly being priced out.

That is, they simply cannot afford to purchase homes anymore and are becoming less and less driven to continue their search.

With unrealistic prices seen all around the board and most steeply in the Dublin area, where housing demand is the highest, buyers are beginning to call off their hunt for homes.

What about the future?

How long will these buyers that choose to wait, be waiting, until they can comfortably afford their dream home?

With housing prices being upwards of 11.4 times more than the typical buyer’s disposable income in 2017, with an expected increase to be reported in 2018, it is likely it will be years before homebuyers are able to comfortably afford homes in the Dublin market.

It is likely that they will begin to look in the neighboring areas where prices are less competitive and there is less demand.

If, and when, housing price inflation regulates, it is possible there will be …

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Is the Housing Market Really Recovering?

The Irish property and housing market have been working to recover since 2012, solely funded byways of international capital.

That’s nearly 6 years of borrowing to achieve a market that remains in the midst of a crisis.

Foreign investors have for long been a very prominent component in the market as they have achieved multiple ways of investing in properties and homes in which provided for a strong return.

International investors have been tracked as using a strategy in which all of their funds went to purchasing the most inexpensive properties in the cities of Ireland and reselling them at extremely high prices to buyers.

This is a smart way for investors to get the highest return possible and make the most out of their investment contributions.

Some investors have begun in the flipping business in which they would sometimes reconstruct entire office blocks for re-selling. By doing this they as said above, are able to buy for extremely low prices and make a large profit margin when reselling.

The latest development in the …

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The Mortgage Rate War

Good news is underway for those looking to enter the housing market, but find borrowing rates to be making it too expensive.

There’s a mortgage rate war.

Though this term sounds less than appealing, it is a war in favor of getting lower rates to borrowers and moving more first time buyers into the housing market.

As discussed in a previous posting, Ulster bank recently announced dramatic cuts in their variable and fixed mortgage rates.

The question racking everyone’s brain after such an announcement was, will other banks fall in line to stay competitive in the market?

Ulster caused increased competition in the market and even more so, posed a threat to the other banks.

These other banks were beginning to notice that in order to stay competitive they only had one choice…

To get to Ulster Bank levels or face the result that they may lose all new entrants into the market as well as some of the old.

Shortly after the announcement of Ulster Bank to reduce their mortgage rates, followed KBC …

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Current House Price Report

Recently released at the beginning of July 2018 was the housing price report for Q2. Though little differences appear on the surface, there are few small signs signaling a positive overall change in the market.

Home sale prices are currently up when compared to those of just three months to a year previous. This statistic is proven accurate for nearly all parts of the country, that is, with Donegal being an exception. Donegal typically is the outlier of the counties as Brexit is being found to have a strong impact on their housing market.

Because the housing market is still showing sign of increased demand coinciding with a weak development of new homes, it is predicted that the prices will continue to grow. However, with this most recent report from draft.ie, we see that the overall trend may be slowly changing as prices are only 5.6% higher than the current 0% inflation, being the lowest rate of inflation reported in nearly four years.

The last time Ireland has seen a similar situation to the one currently facing the economy was …

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Will Ulster Bank Dominate the Housing Market

Recently, Ulster Bank, a major mortgage lending bank, announced a drastic interest rate cut down to a 2.3% fixed rate for two years. Essentially blowing their competitors out of the water.

Against all other players in the market, the Ulster Bank is offering the lowest rate of all.

Ulster’s closest competitors, being the center at Haven Mortgages with a fixed rate set at 2.8%. All other banks showing rates setting at 3% – 3.2%.

The lingering question after this announcement by Ulster is, will we be seeing a shift in other banks to lower their rates as well?

This is an important question for the borrowers as well as the lenders for it impacts the business trend between banks.

If the competing banks believe they need to to stay competitive then it is likely that we will, however, if they have the advantage to keep them ahead of their competitors then they will have no need.

It is hard to say for sure if the other banks will follow in suit and lower their interest rates but that is genuinely …

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