Rent to Buy dilemma

S

shanedan

Registered User
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Hi,

Mods I have read the key post on house speculation and think its OK.
Feel free to close it if I am wrong. Ta.

We are in the process of buying a 3 bed townhouse in Balbriggan for 238K
We are doing this under a Rent to Buy Scheme.
All this talk today and yesterday about further falls in the price of house has us thinking again.
As we see it the house doesn't seem wildly overpriced at the money.
The thing is we are reluctant to sign contracts now to buy the house at 238 in case they drop like a stone from now on.
The bank will be valuing next year for the mortgage so we could end up with a big gap between what we agree to now and what its deemed to cost next year.
So I guess my question is, would we be better to hold off for ayear and see what happens or take the plunge?
Just to add these houses are already down from a high of 410K
Shane
 
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Does the house tick all the boxes for you. Is it an area where you want to be living. Will there be a likely hood that you will have to move/upgrade if kids come along etc. If you plan to be in the house for the medium to long term and you can afford to pay the mortgage if or when interest rates start to rise then no harm. How secure are you jobs? Perhaps voice your concerns with the builder. You may be able to renegotiate the price.
 
Thanks for the reply.
The problem is we are signing the contracts now agreeing to buy the house at 235.
If it get valued by the bank for the mortgage at say 200K, then that's all the mortgage we could get.
That will mean we will need to make up a 35K price drop
 
Well if you feel that you may need to have 35k or more or less than this amount and you won't at the time of getting the mortgage then you cannot afford to buy the house. These are all the things you need to consider.
When I bought my house I remember the bank being willing to lend me much more than I thought I could afford as I wanted to make sure I had enough disposable income to be able to live a life and not just be paying a mortgage. I bought further from the city but am happy out and it has allowed me to live a good life and not feel choked by a mortgage.
Why not save intensively now and try to find a comfortable but inexpensive place to rent until you can afford to buy.
 
shanedan said:
Just to add these houses are already down from a high of 410K
Shane
Click to expand...
Sounds like you are buying the house Only because it has come down from 410k.

If you were today going to buy the house for 235k would you get mortgaged approved? If the answer is No. Then forget it.

If the answer is yes, the you need to consider what could change in the short term that means you might not get mortgage approved in one years time and or the property is valued lower.

I would say a lot will change in a year and renting would be a more flexible option for you, whilst to save for a deposit etc etc.

House prices are not going to make a speedy recovery so whats the rush?
 
I only mentioned the price drop to highlight how much things have came down so far.
Just wondering if they likely to drop much more.
We got the approval for that amount but we werent in the position to have the deposit.
We both really like the area and the house as it suits us both way better than the city :)
 
shanedan said:
We got the approval for that amount but we werent in the position to have the deposit.
We both really like the area and the house as it suits us both way better than the city :)
Click to expand...

I really like fast cars and women and it would really suit me, way better than the wife.......but i can't afford them!! (So i'm saving like mad for when i retire)

Rent and save for the deposit!!
What is it about our culture. People still believe they have a right to have something they can't currently afford!

As for the price dropping further, probable in my opinion but what do i know. Why take the risk if you don't have too?
 
We will be getting married in 2 years so just trying to keep ahead of the game in the settling down stakes and have that much sorted beforehand

Thanks for all your answer, it was more of a do people feel will prices drop much more than a What should I do.

Thanks
Shane
 
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