The homeowner, the reluctant renter and the twenty-something: Three of our writers opened up about their experiences in the property world
Yes, I am privileged. I own a property in a good location, the Dublin suburb of Blackrock. I certainly wouldn’t be able to afford to buy it now.
But it was also a struggle, from the day I bought it to the €15,000 I had to spend last year putting on a new roof. No matter how elegant an old house may look, there is little pleasure in sitting watching the rain run down the inside wall after a heavy shower.
In the early 1980s, at least there were houses – if you could afford to pay the 12pc interest mortgage lenders were charging.
My friends were buying houses, some moving to locations like Bray and the outskirts of Dublin for ‘starter’ homes.
The difference in those days was that inflation was high and if you were smart and could get a loan, you could ‘flip’ the house and make a good profit within a relatively short period of time.
In that way, some people were able to work their way quickly up the so-called ‘property ladder’ to more desirable suburban locations.
In my own case, I had a couple of thousand pounds saved with the EBS Building Society and set my sights on a semi-derelict period property with ‘potential’. Luckily enough, I didn’t realise how much work and money it would take to bring out the so-called potential.
I agreed to buy it, but the building society declined to give me the money, a modest £28,000. They said the house was in such a state of disrepair that they might not get their money back if I defaulted on the loan.
So, I ended up in front of Mr Michael Fingleton in his office in Camden Street, making my pitch. He agreed with my contention that “buying the worst house on the best street” was a smart property strategy.
Whatever else has happened, I won’t forget him for advancing me the loan that made the purchase possible.
With the help of very good friends and family and several remortgages later, it became a habitable and happy home, the only one I’ve ever owned.
Am I dismayed with the current housing situation? Yes. I look at my four adult children and wonder will they ever be able to afford homes of their own, or will I have to sell up to give them a start.
With all the conflicting opinions on the housing crisis, I don’t know what the answer is, but there needs to be a radical new strategy to provide young people with affordable homes.
When it comes to today’s housing sector, everyone’s got a tale of woe.
There are the renters who know that, in the current climate, finding a home will require either a miracle or a dramatic change of postcode.
There are those bogged down in negative-equity homes, with little chance of advancing to the next step of the property ladder. And then there are the accidental landlords who wring their hands about their own sorry lot.
To some extent, I’m all three of these things, although my tale is far from unusual.
By 2007, I’d had it up to here with the long-held idea that bricks and mortar were a wise investment that would only ever stand a person in good stead.
It was just a life milestone we were supposed to hit, no questions asked.
Now, into every life a millstone or two must fall, and I know I’m not the only person carrying around one shaped like a boom-time purchase.
When I signed the paperwork and provided the obligatory firstborn, I was thrilled to be getting off the rental hamster wheel.
At 30, securing a 100pc mortgage was relatively easy, and I bought a €350,000 apartment near a pub I really liked. That was my first mistake.
The area was being widely touted as the “next IFSC”. Buying into that marketing nonsense was my second mistake. Three years later, units in my block were selling for €70,000.
A few years in, I felt I’d outgrown the apartment, and the area, so I moved out and rented another house (by the way, that’s not a crime, wanting a change of scenery).
I rented my apartment to a man who also owned his own home.
My new landlords also rented their family home from someone else. The owner-renters, most of us in negative equity, seemed to be everywhere.
In any case, my accountant was aghast at my decision to rent elsewhere.
“Is there any way you can reverse that?” he asked, and now I know why.
Sorting tenants, arranging repairs, rental income tax, leaky washing machines, destroyed furniture, tenants who can’t pay rent, tenants doing a runner – it’s no cakewalk.
And yet, as a renter, I experience the same challenges as everyone else in Generation Rent.
I’ve had to vacate houses I’ve loved because an owner was selling up. I’ve gone through the reference/bank statement/licking up to the estate agent rigmarole more times than I’d care to.
I can’t hang up a picture without waving goodbye to my security deposit. It’s home, but not home home.
Right now, I rent outside of Dublin, with a vague view to buying a forever house eventually; a plan given fresh urgency since I became a parent two years ago.
I would love to give my child the security I enjoyed in my own upbringing. Yet given the nature of the market right now, that in itself seems like a tango with madness.
One thing’s for sure – I won’t be buying something just because it’s near the pub.
If there is anything to be learned from the latest ESRI figures, it’s that Generation Rent is set to become generations of renters.
We already know about the odds that are stacked against young people as they try to buy a home – high rents mean that saving for a deposit is next to impossible and with cuckoo funds outbidding first-time buyers by tens of thousands, buying a home when supplies are very low is a challenge, to say the least.
And now, official figures show that not only did the pandemic disproportionately affect young people, but their earnings are stagnating in comparison to the rest of the labour market.
It is little wonder that home ownership has halved in a generation. At every step on the journey of getting on the property ladder, a curve ball is thrown in the way.
As a young working professional in my 20s, one who is lucky enough to be on a salary, I should be thinking about buying a home. Each month when I pay rent, I may as well be throwing the money out of the window: it is a complete waste of my income.
But being in my early 20s and not married, the chances are incredibly slim. Half the battle is getting mortgage approval under tight Central Bank rules.
Already on a low salary compared to the generations before them, renters need to be able to pay extortionate rents and put away hundreds of euro each month to raise a deposit on a property, a sum that ranges from €15,000 to €40,000.
After years of saving, a commercial bank then picks their finances apart in excruciating detail. If they’re lucky, they may be finally approved for a mortgage. Phew, the hard work has paid off.
Not so fast – here comes the second leg of the journey: finding a property that is in their price range and actually buying it.
Then come the ‘cuckoo’ funds to jump out from the dark. Even when a renter thinks they have found the perfect home and are in a position to make a bid, the funds sweep in, able to outbid family buyers by up to 18pc.
So, the renters stay renting, as they trudge unsuccessfully from one property to the next and prices rise, while their salaries do not.
Housing Minister Darragh O’Brien has big plans for ending the housing crisis, but the ESRI has warned that his shared equity scheme will hike prices.
New regulations to override councillors when transferring public lands will mean little for first-time buyers.
Cost rental provisions will mean cheaper rents, but a slow roll-out won’t actually bring down the price of a home for years.
And it won’t be long before Generation Rent becomes several generations of renters.