Nurses, teachers and gardaí priced out of property market by strict lending rules
Key workers including nurses, gardaí, IT specialists and farmers are being priced out of the property market in most counties, a study by the Irish Independent has found.
Rising property prices mean that many families are unable to buy a home close to where they work, and the position is even more serious for families on single incomes.
The average national price for a property stands at almost €157,000, meaning that a basic salary of almost €45,000 a year is needed to secure a mortgage. But prices in Dublin, Cork and Galway are significantly higher than the national average. They range from €240,000 to €362,000, meaning a family's income must also range from €61,000 to €89,000 before a bank will approve them for a loan for a house.
The situation has been exacerbated by rising prices.
A study by the Global Property Guide this week found that Irish house prices have risen by over 10pc year-on-year - the second-highest rate globally.
On top of the earning requirements, deposits needed for securing mortgages have limited where people can afford to buy. The Central Bank brought in strict new rules on mortgages in February requiring the borrowed amount to be no more than 3.5 times the annual salary of the borrower.
The national average for first-time buyers (FTB) is to provide a €17,000 deposit, while second-time buyers (STB) pay nearly €31,000 to get a mortgage.
This rises significantly when looking at major urban areas where the average FTB deposit is nearly €32,000, while the average STB deposit is over €53,000.
A garda with over five years' experience can expect to earn in excess of €35,000, but this salary alone does not satisfy the criteria required to secure a mortgage in almost half of the areas the Irish Independent looked at.
A newly qualified primary school teacher earning nearly €31,000 a year looking to get a mortgage with a partner who is a farmer earning nearly €27,000 wouldn't meet the earning criteria to buy property in nearly a third of areas in the country.
An IT specialist earning €75,000 looking to secure a mortgage with a partner who works as a fully qualified accountant earning €40,000 would meet the earning criteria required to be able to afford a mortgage anywhere in the country.
However, the deposit required for a house in Dublin city would be higher than the accountant's annual salary.
The house prices included in the table are provided by the Real Estate Alliance who compiled the data for the Irish Independent. The prices above are the average cost of a three bedroom semi-detached house in 30 areas across the country.
To calculate the deposit required for FTB, the first €220,000 of any given house price requires a deposit of 10pc of the value of the house. Everything after the initial €220,000 is at a rate of 20pc.
Calculating the deposit required for STB is a flat 20pc of the value of the house.