Excellent article in Indo about apartment buying

Laura Noonan is a finance journalist with the Indo who bought an apartment in December. She reflects on the experience in today's paper in an article entitled [broken link removed]. It's a very candid, very well written piece.

As for house prices, I was so busy looking at how much they had already fallen, that I hadn't given much thought about how far they had left to go.
While I smugly congratulated myself on paying half what my neighbours did, it never occurred to me that someday I too would be that sorry traveller.


That blissful ignorance is gone now -- within six months there was a flat on the market downstairs for about 10pc less than the asking price of mine.
When I took the plunge, I convinced myself my little corner of Dublin, the bustling south docks area, was different than the rest.
....Then there's interest rates. As a financial journalist who travels to [broken link removed] for the [broken link removed]'s press conferences, I should have seen the hikes coming.


In my defence, I did, but the 'dying to get on the property ladder Laura' somehow managed not to factor them into her sums.


Swept away with the excitement of getting my own place, I never paused to reflect on how the news I write about could impact on my own circumstances.

Click to expand...

Hi Brendan

I'm sorry but I cannot see the merit in this type of article.

She bought an apartment. It's not worth as much now as it was it then.

So what?

It's a non-story. Who knows what the next 20 years will bring?

Marion

Yes, I read it too.

It really shows her up as regard to financial issues which she did not account for.

I see nothing in this article other than a persons lack of awareness following 2.5 years of economic downturn and gloom.

Perhaps she was living on Mars at the time.

It's frightening that this is written by a finance journalist on a national broadsheet newspaper. There's too many of gems to pick out but I particularly like this one

"Do the sums on the impact of interest rate rises. If prices fall another 10pc this year, will you lose more there than you'd have paid in rent?It's tedious but could save you a lifetime of regret and negative equity."

How many Sunday Indo/Indo scribes are going to share their tales of woe after buying property, Alison O'Connor, Brendan O'Connor, Laura Noonan...

How is this news?

While i agree with the sentiments of the previous posters one is tempted to ask when one should take the plunge to buy and avoid what happened to this frank but perhaps naive journalist. If everyone sits on the fence the omens will be bad for the country. No easy answers

It's a very candid, very well written piece.

Click to expand...

This is not "excellent" in that it is good advice or insightful.

It is excellent in that it is well written and it's very candid.

She admits her mistake in thinking that because the apartment had fallen 50%, it meant it was good value. This is useful to a lot of potential buyers.

It is also very interesting in that "Laura Noonan the want to buy a house girl" became very separate from the professional financial journalist. What she learned in her work didn't affect her decision.

I think that the internet will be very useful for looking at how people and society made decisions and maybe we can learn from our mistakes. Laura has written a recent account of a decision she has made, the timing of which may well turn out to be a mistake.

We see a lot of anonymous people on askaboutmoney and elsewhere looking for solutions to their problems. These problems often arise because of their own mistakes - e.g. they didn't read the small print, they didnt' get the house surveyed. It's rare for someone to write about their own flawed decision making process in public. And I say well done to Laura for doing so.

Brendan Burgess said:

She admits her mistake in thinking that because the apartment had fallen 50%, it meant it was good value.

Click to expand...

She only said that she hadn't considered that it would fall further. Who know's whether it is good value or not - I don't think she was giving up just yet on it being a worthwhile move.

I don't think people have to beat themselves up or even consider it a mistake when they are at a point in time where their house is worth less than previously, no more than they should pat themselves on the back when a house they have no intention of selling is worth more than they paid.

I don't agree that she was silly. She probably should have known more about the management charges but it sounds like there was an unusual situation for the legal fees. Maybe she should have considered interest rate hikes that are on the way (I suspect she's pretending to be more naive than she was to make the article more relatable for non-financial people).

I do agree though we've had too many journalists using their own personal property disaster stories as news or public interest. I particularly cringed at the one a few weeks ago where the person was getting by fine with the payments, not yet in negative equity but was resentful because they felt entitled to be more than just comfortably off because they had written 4 novels. My heart bled.

Yes, I have read some rubbish by a Sindo journalist whose name I forget who thinks that she should get help because she is in negative equity.

I think that Noonan's article is of a different calibre altogether.

My comments were aimed at her seeming financial illiteracy and indeed lack of interest in things financial. I think business & financial journalists should have an interest in and an ability to understand these matters.

"I didn't really give much thought to legal fees"
"Management fees didn't feature in my calculations either."
"As for house prices, I was so busy looking at how much they had already fallen, that I hadn't given much thought about how far they had left to go."
"When I took the plunge, I convinced myself my little corner of Dublin, the bustling south docks area, was different than the rest."

The above (among other parts) suggest to me that Ms Noonan has neither of these fairly basic requirements to do her job.

I agree it's refreshing to hear people talk about making mistakes but I'm just surprised a business journalist would put their name to this article.

Tvman

The whole point is that she, a financially literate person, acted in an illiterate manner when it came to buying a house. It shows the frequent triumph of emotionalism over rationalism when it comes to house buying.

I think it's very similar to the article by Mike Milotte where he admitted to being scammed into paying for a camera which was never delivered.

Readers do learn a lot from these real life examples.

Brendan

tvman said:

My comments were aimed at her seeming financial illiteracy and indeed lack of interest in things financial. I think business & financial journalists should have an interest in and an ability to understand these matters.

"I didn't really give much thought to legal fees"
"Management fees didn't feature in my calculations either."
"As for house prices, I was so busy looking at how much they had already fallen, that I hadn't given much thought about how far they had left to go."
"When I took the plunge, I convinced myself my little corner of Dublin, the bustling south docks area, was different than the rest."

The above (among other parts) suggest to me that Ms Noonan has neither of these fairly basic requirements to do her job.

I agree it's refreshing to hear people talk about making mistakes but I'm just surprised a business journalist would put their name to this article.

Tvman

Click to expand...

Worded exactly the way I meant to put it in my previous post.

Yes I could understand the emotional issue affecting a person back in the celtic tiger years, everyone was buying then, but for a person that shows a lack of knowledge in her field and after 2.5 years of recession etc, I think she should of confined this article to her scrap book.

Brendan Burgess said:

The whole point is that she, a financially literate person, acted in an illiterate manner when it came to buying a house. It shows the frequent triumph of emotionalism over rationalism when it comes to house buying.

Click to expand...

The whole point is that she hasn't learnt from her mistake. She sounds like the person who came on AAM and said he was stung at the Allsops/Space auction by the dodgy title. I don't recall him getting much praise. All they way through she insists, rather vacously, that she made the right decision for her at the time - whatever that means. And it isn't a well written article, unless you value the novels of Celia Ahern or similiar.

"it shows the triumph of emotion over rationalism"

-is that always such bad thing ?

Emotions such as love, pity, ambition, envy and many others are aspects of behaviour that have caused humanity to move forward (as well, of course, sometimes backwards).

Rationally, comrades, we could all live in the same housing units driving the same cars wearing same clothes etc - anything else is pure emotion.
Dictatorships, slavery, even genocide seemed rational to the proponents of such deeds - opposing them semed pure soppy emotion.

Thank goodness that, rightly or wrongly, we make emotional decisions. And shame on those Mr Spocks whose finger -wagging and tut-tutting about illogical decisions will keep us in this present state of hiatus.

I found it a very interesting read and I do admire her honesty. I do feel though that she feels quite sorry for herself and I find this a little hard to take.....

I do feel though that she feels quite sorry for herself

Click to expand...

I didn't pick this up at all.

So did I do the right thing? If I'd given it more thought before I took the plunge last December, would I have gone ahead anyway or waited?
It's a tough call. I did the right thing for me at the time -- I needed a place to live, so I bought one. And, despite the ups and downs, I do still love it.
Undoubtedly, my timing could have been better -- but then my timing was better than that of many friends who bought at the peak.
Calling the top and the bottom of the market is largely a matter of luck, not skill, so it's not something I really beat myself up over.

Click to expand...

and

and never look back

Click to expand...

We all have made decisions, which with hindsight, we could have made better. We bought something without checking out the details. We signed a contract without reading what we were signing. We knew about management charges, but accepted the auctioneer's word that they were "small". Most of us learn from our mistakes. I think that when Noonan next goes to buy, she will check out a few more things.

Brendan

Whatever about management fees etc, she bought an apartment in a prime city centre location in the Country's capital. She didn't buy an apartment in Longford or Kildare (no offence to those Counties). A 10% fall in such a short space of time with zero liquidity in the market means nothing. Interview her again in 5-10 years and it will be a different story. I think the thing about the interest rates etc is added for effect. I am willing to bet if she got a mortgage for an apartment last Autumn when everyone was saying there was no mortgages being given, her financial ability to pay is greater than what comes across in the article. She is far from stupid. Seems like a smart young lady to me.

I still don't understand what is the "mistake" that Brendan and others refer to.
Surely nobody thinks it's a "mistake" to have bought a property purely because of a small decrease in price several months later? ( based on an apartment sale on a lower floor where there's usually a few percent differential anyway). And ,yes, there may be interest increase -which will still mean lower rates than the 80s and 90s.

As one poster -dewdrop- said - if we all sit on the fence the omens will be bad for this country. I entirely agree. As long as rubbish articles like this from so-called financial and property correspondents continue, in which basically they are warning that prices may fall further, then prices will fall further and we'll all be in deeper trouble.

And yes Brendan she did feel sorry for herself as blatantly stated at the start of her piece..
"it never occurred to me that someday i would be that sorry fellow traveller"

What's more annoying than the spirit of regret,or at least doubt, regarding her property purchase I just can't see the basis for it.

This is getting very confusing

I don't think she feels sorry for herself.

You do. And yet you think that she shouldn't.

She acknowledges a few mistakes.

As for house prices, I was so busy looking at how much they had already fallen, that I hadn't given much thought about how far they had left to go.

Click to expand...

That is a mistaken process. Not necessarily a mistaken decision. If I was buying or selling now, I would be primarily concerned about the future of house prices. I wouldn't buy something because the price has been reduced by 50%. I would buy if I thought that prices were close to the bottom and I needed to buy. Or I might conclude that I really liked the house and that this was more important than the actual price, and given that I can't forecast house prices, I might buy anyway. But she didn't seem to go through that process, which is a mistake.

But she has an apartment which she really likes and she can well afford the mortgage, so it's not a huge mistake.

I have to say I think that if she was really being honest she would be saying I wish I hadn't bought last year - its not a tough call at all, much as she tries to justify it. That is the vibe I pick up at the start of the article through to the middle. That she is basically saying how can she have been so naive. Towards the end she does change her attitude to one of, hey it could have been worse, but on a whole the article is pretty negative. Thats my opinion though, and it seems we are all picking up something a bit different after reading it!

I find the article very annoying because she is portraying herself as a very naive girl BUT she is actually a financial journalist! If she is really that stupid as she makes out to be, she is in the wrong job! If not, she is just trying to appeal to the audience of financially naive and careless people, and I find that annoying.

Particularly at the end of the article she makes the case for how boring finance is, to me it's not, what's boring is ignorance.

I agree with posters here who say that she is not really in a bad situation. It looks to me like attention seeking without any real point to the article.