To rent a house or ???

PaddyJo

Registered User
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Hello, I would love if someone here could give me some advice or guidance on how to best proceed financially.
We are a married couple and have a 2 yr old son and another baby due in Jan. I purchased a 2 bedroomed city centre apartment through the affordable housing scheme 8 yrs ago. I have lived there since purchase. It is not in negative equity but probably would not make much of a profit if sold. I got confirmation from Dublin City Council that I can rent this out or sell it and the clawback no longer applies unless I sell it for more than I paid for it (which won't happen). Mortgage with EBS.

My husband co-owns a 2 bed apartment with a family member. This is in negative equity. The family member lives here and is not in a position to buy him out. He does not put any money towards this apartment, except half of the management fees. Mortgage with BOI

So, we ideally need to move to a house before our second child arrives. We are saving as much as we can on a monthly, basis but we are far off having enough for a house deposit. Realistically, it will take us up to 3 yrs to have a good lump sum for a deposit when we factor in childcare and possibly the cost of rent. Do u think we should rent a house for a few yrs, continuing to save as much as we can or speak to the banks and see if they can offer us any solutions? Can anyone recommend a financial advisor or someone who could advise us in this situation.. Or is it best to go directly to a bank? Based in Dublin. Thanks in advance for any suggestions
 
Lots of families live in two bed apartments.

Presumably the cost of your mortgage interest is much lower than you would be paying in rent?

Do you have a tracker mortgage?

Your best bet is to put up with the inconvenience and live as long as possible in the apartment. You will find after about 5 years that you will have paid down some of the capital.

If house prices rise in the meantime, your husband may be able to get out of the joint mortgage with his family member and you will have built up equity in your apartment.

If you rent now, you may never be able to afford to buy a house.

Brendan
 
Thanks Brendan for your advice. I know our best bet is to stay in the apartment but it's not feasible for the next 5 years. My husband has a tracker mortgage on his apt. I have a variable on mine. My husband spoke with an AIB mortgage advisor a couple of months back and they suggested we upsell the city centre apt. Would you think this is possibility? My mortgage interest is €1000pm, but we have childcare costs also on top of this. If we were to rent, it would be in the region of €1700 or so rent and we would be able to hire a live in aupair which works out at roughly €500 per month, as opposed to the guts of €1800 crèche fees for 2 per month. Thanks for your help.
 
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