Housing in half of all counties are unaffordable

According to the Irish independent, homes are becoming so expensive that first time buyers cannot afford to purchase a home in half of the counties in Ireland. Not only are the housing prices too high to quantify as affordable, but mortgage requirements do not make buying homes possible for first time buyers. In other words, a buyers average income does not amount to the fund needed to deposit. A buyer’s income on average also does not quantify to high enough earnings to qualify for a mortgage.

The lack of affordable homes have always been an issue in Dublin and Cork, but the trends in the housing market are causing widespread housing unaffordability throughout the state. Recently, a survey conducted by the EY-DKM economic advisory determined Co Roscommon, Co Clare and Co Offlay have been defined as additional counties that are now too expensive for buyers.

The most unaffordable counties of Co Wicklow, Co Kildare, and Co Meath have been defined as the most unaffordable in terms of saving for a deposit. These counties take an average of 15 plus years to obtain a 10 percent deposit needed by a first time buyer to qualify for a mortgage under the Central Bank mortgage regulations.

Co Roscommon has recently become more unaffordable, and on average it would take a first time buyer 10.4 years of saving to have the funds for a 10% deposit needed to qualify for the mortgage. According to the EY-DKM analysis, Co Roscommon has been defined as unaffordable because of low levels of income in the county opposing the high rents, although housing prices are relatively low.

Analysis of first time buyers in Co Dublin determined that savings for 4.3 years are needed for the mortgage deposit. The analysis of Dublin depicts a higher incomes on average, although prices of properties are much more expensive than the rest of the states.

The most affordable county was defined as Co Letrim. The amount of years required to save to qualify for a mortgage is only a little over a year. The top five most expensive locations have been defined in order as Co Wicklow, Co Kildare, Co Meath, Co Dublin and Co Galway. Affordability was analyzed on the basis of the ability of buyers to afford the mortgage and the length of time needed to save for a deposit.

Counties that are also considered unaffordable are Co Clare, Co Offlay, Co Louth, Co Cork, Co Mayo, Co Carlow and Co Westmeath. The effect of increasing number of counties with unaffordable housing is that potential buyers are unable to purchase a home, and thus being pushed out into rural areas where properties are more affordable.

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