To mortgage 195k would cost about 900pm over 35 years and you would have a house rather than an apartment for roughly the same monthly repayments.
As it stands it was a great move for us, if and when the time comes and you choose and when thing have sorted itself out with the land you could decide then that you want to sell and build - using what ever equity you have.....
If it's only a starter home to get on the ladder then they'd be better off holding out and using their FTB status for the property they really want.
To mortgage 195k would cost about 900pm over 35 years and you would have a house rather than an apartment for roughly the same monthly repayments.
Don't forget the tax benefits of home ownership either. This certainly sounds like it is worth considering anyway, though be sure to factor in rate rises or fix your mortgage for a period if you are concerned about not being able to meet these increases.
You could always throw in a "take-it-or-leave-it" stink bid on the house and chance your arm that way.
to be honest we have had enough of paying someone elses mortgage and the hassle of renting, even if in 3 years time we sell the house on and get what we paid at least we will have some money paid back off it instead off wasting dead money on rent
I think you are underestimating the risk of buying this property, and since it is only for the short term, I think you would be better off to continue renting for the moment.
I don't see why anyone would buy a house with the intention of selling it again in three years.
What about profit? I think that sometimes people can have an unhealthy attitude to property. The whole "must get onto the property ladder no matter what the cost" approach is extremely dangerous. But also the idea that you must hold onto property for ever or for at least a certain amount of time can become very costly.
Alarm bells when I see you talk in these terms!!! You are looking at this in a more emotional way than you realize.
After 3 years on a 35 year loan, you will have paid off less than EUR 7,000 from the original mortgage. Be careful in presuming that you will even be able to get the original price you paid for the property. AIB came out yesterday to say that they expect house prices to fall by 2% this year alone.
I think you are underestimating the risk of buying this property, and since it is only for the short term, I think you would be better off to continue renting for the moment.
The transaction costs of selling are not that high. You will have solicitors fees and auctioneers fees but on the other hand you also have the risk of increased rents and planning permission being refused. FTB Status is not relevant if the OP is building a house. Three years is a long time and nobody can predict whether the house will be worth more or less then. The house is only worth what yuo want to pay for it. The OP wants a home of his own eventually and if planing is refused then presumably in three years he will buy anyway? Personally I would go for it!
You're not looking at the full picture here.With regards to the money side though isn't 7k off my mortgage better than having paid 7k off someone elses??
You're not looking at the full picture here.
As an exercise, work out all of the monthly outgoings you would have to make should you buy (i.e. mortgage, insurance, furniture, transaction fees, ...). Compare this to the monthly outgoings you would have for the next 3 years if you were renting.
If there's no capital appreciation, which works out to be better after 3 years? How much capital appreciation is required for the buyers profit to match the renters savings? If you think this level of capital appreciation will be easily met, then you should buy. But don't forget that if you get it wrong, the debt you have leveraged could end up losing you a lot of money very quickly.
Ok, I see. It's not strictly a short term purchase then. Provided that you are comfortable with the fact that you may have to live there a lot longer than anticipated, then at the current price (when compared to rent) it is not a bad deal.just to clarify I suppose - the plan is to build in 3 years, this hopefully will happen - but with planning etc you may never know it might take longer or never happen ( hopefully it will), so it is more than just a stop gap or an attempt at profit making it will be our home for the foreseeable future. We would be secure enough in the money we are earning to cover any more interest rate increases for the time being.
I still think you are looking at this as a bit of a profit making scheme. It's probably worth pointing out that if you were in negative equity in 3 years time and there was a housing slump, it would make it quite difficult to get the finances together to build your own home (should you finally get the planning permission granted). You could be jeopardizing that plan by making a bad decision here.Ideally if all goes well and we get sorted for planning etc and we have a newly built house in 3-4 years time we would like to hold onto this property to rent it out.
Ok, I see. It's not strictly a short term purchase then. Provided that you are comfortable with the fact that you may have to live there a lot longer than anticipated, then at the current price (when compared to rent) it is not a bad deal.
I still think you are looking at this as a bit of a profit making scheme. If you're comfortable with the risks though then best of luck with whatever you do.
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