IT comes as no surprise to many of us that the housing market in Ireland remains an enigma.
Unfortunately, we’re at a place where homelessness is becoming so much more frequent, it’s slowly morphing into the norm. So many people, young and old, are depending on shelters, hotels and in some cases doorways as a place to call home.
I count myself as very fortunate to be in a position that I have a home that is safe and warm. It is, of course, the family home where I was raised.
As the youngest of four siblings I’m the only child remaining in the family home. I had moved out at 18 to attend University in Limerick and following that I lived abroad twice, but I have been living here consistently now for the past four years.
I made the decision some time late last year that it was time to get a bit more serious with my saving and try to work towards perhaps getting my own place.
Now, there has always been the option that I could move out and rent, as so many of my peers are doing. However, due to the location of my job and proximity to the city and friends, I haven’t ever really seen the benefit of doing so.
I find it extremely difficult to think of handing over €500-€600 a month to a landlord for what in most cases will be a room.
Again, I consider myself blessed that this is an option for me and I’m not forced to pay scandalous rent prices.
So, with a longing to put my own stamp on a place and have somewhere to call my own, I took the plunge and reached out to a broker.
Perhaps it’s a result of graduating in the height of the recession and being part of a generation who can’t afford to buy their own home that has given me a negative outlook on Irish society.
But as a single person I was somewhat sceptical as to what my chances of ever getting a mortgage would be. I was surprised at one response I got.
While I had some basic knowledge of what a bank would look for in a candidate, I didn’t have as much information as I would like. This particular broker asked me a series of questions, including how much was I hoping to borrow, my salary, what savings I have, what debts I have, can I show I’m capable of repaying a mortgage sum, and have I got children?
Having followed up with the broker, they estimated I could attain a mortgage but only for 3.5 times my salary. However, with my deposit it would increase my buying scale.
They also highlighted that as a first time buyer I’m entitled to borrow up to 90% of the purchase price and that a 10% deposit is necessary.
Another criteria which would be looked at is my ability to pay back the mortgage. In this instance, renting would be useful as it would clearly show a regular sum of money similar to that of a mortgage repayment, or in some cases more, leaving my account.
As I don’t rent I need to show I can save the same figure monthly for a sustained period. While I have been saving regularly, it is not the amount that my mortgage repayment would be, so this is something I need to take action on going forward, but something I’m confident I can do now that I’m aware of it.
I was unaware your net disposable income is also looked at, so after your mortgage repayment has been paid for the month, you need to show you’ve got sufficient finances to support yourself, pay your other bills, etc.
Of course, any loans will reduce the amount you can borrow.
All these conditions need to be met both as stand-alone criteria and collectively so there is a lot to consider.
The Help to Buy scheme is also a possible route for me which, if I qualify, will potentially give me a maximum of €20,000, but it’s worth knowing this is only applicable to new builds or self builds.
Having gotten the information I think all of the above are achievable. The main aspects that frustrate me are that as a single person I am automatically at a disadvantage because there is only one income, versus a couple.
I obviously know that, to a bank, a household with two salaries is a far more attractive prospect and I’m not saying they should lend me a ridiculous amount of money because nobody needs to experience the backlash of that again.
But I do think it’s unfair that we live in a society where it’s so difficult to make a start in life. There are so many hardworking people who want to have their own home, not only for a sense of independence but for their self-esteem.
Now that I have started the process, I will certainly sit down and figure out my next steps. I know a mortgage is achievable but I fear my next biggest obstacle will be what I can afford versus the location I want that to be in.
I want to be near my family, friends and my job, and if the searches I have done so far show anything, it’s that I will find it tricky to get something I want on this side of the city.
Still slightly elated that I wasn’t laughed out the door by the broker, I’m happy to try and move forward, but nor am I naive enough to think I’m going to get exactly what I’m looking for where I’m looking for it. I can only hope I will find a diamond in the rough some day soon that I can call home... or win the Lotto!