Buying a D.14 home - The costs.

9 Knocknashee in Goatstown is for sale through Lynam Auctioneers with an asking price of €1,095,000. Assuming this follows the trend of prices going for at least 10% above the asking price, let’s say you go sale agreed for €1,204,500.

**EDIT 22.10.2024 – Well don’t I feel foolish! Latest bid as of yesterday was €1,360,000. TBH, I’m not surprised in this market. Nonetheless… you can still do it using the figures below, but you’ve just got less cash to spend on improvements. Or you could qualify for, and are comfortable with, a higher mortgage amount? If you’d like some advice on buying your new home, please get in touch!

Let’s have a look at the figures involved in buying this home, particularly as it looks like it would benefit from some upgrading.

The assumptions I’m making:

This is not your first home.
You recently sold your house in the area and have netted €590,000 after fees from selling it.
Joint borrowers – You are both aged 50. Neither of you smoke.

You can view the brochure for this property here.

So how much will it cost to buy?

This table shows the total cost of buying this house and how much you will need to borrow from your lender to complete the purchase.

Details	Amount in €
Purchase price:	€1,204,500
Stamp duty:	€14,090
Legal fees:	€4,000
Total cost:	€1,222,950
Less deposit amount:	€590,000
Balance / Borrowings required:	€632,950

The calculations above get you the house – Congrats! But it’s BER rated E1 and it need some updating. It would benefit from far more than just a lick of paint. The bathrooms need updating, as does the kitchen and pretty much all of the radiators and the finishes like carpets etc. The problem is that you are now tapped out of cash and you don’t really want to get involved in partial drawdowns from the bank, even though you ‘qualify’ for a mortgage of more than the €632,950 you’re borrowing to buy it. In reality, you won’t see much change out of €250k for doing the work.

So what are your options?

Some more assumptions:

As the property is not older than 100 years and the valuer is unlikely to say that it is not immediately habitable, you won’t be forced to get a structural survey done by your lender. This will avoid the need for your lender to hold back some of your approved funds until certain works have been completed. You should get a structural survey done anyway, as this will highlight any more expensive problems outside of what you can see. Let’s assume this goes well & nothing major is noted.

We know the total cost to buy the property is €1,222,950. You qualify for a mortgage of €963,600 (Combined gross annual incomes of about €260k required) which is 80% of the ‘value’ or purchase price of the property. You could borrow the €963,600 over a 20 year term and use €259,350 of your €590k cash to complete the purchase and then you would have €330,650 to do the works to bring your new home up to scratch.

€963,600 over a 20 year term at a rate of 3.80% will cost you €5,738.18 per month.

“But Brian – You said €250k is all the work would cost – Why do we need €330k?” Well, I just used €250k as a round figure and we all know that we get carried away with ‘extras’ when they are presented to us, so it’s reasonable to work on the basis that this house will take every penny you are prepared to spend on it – new furniture, upgraded underfloor heating in the ensuite etc. But no… you don’t HAVE to use your full €330k cash. You could place a strict limit of €250k on the works and either keep the €80k balance or you could just borrow €80k less.

I personally, would borrow the full €963,600 and go to town on fixing the place up using the full €330k cash.

I would then set about reducing the mortgage debt over the next few years. Things like the garden could be worked on over time. You’ve no cash left now anyway, so expensive nights out, apart from being completely over rated, are now also not an option, so you’ve plenty of productive Sundays available to get your wellies on. You’re both 50 – Your kids don’t need lifts to rugby and hockey on a Sunday morning now anyway.

I would love to buy this house, but my wife isn’t too keen on getting involved in doing work to a property ever again. I get it… but… I’d still give it a go. Great area, lovely settled properties, off street parking, close enough to everything, but most importantly, for me, it has a garage!

Summary.

If this house is something that you’d like to get stuck into but you’ve no idea how the whole selling / buying / doing work timeline works, give me a shout. I’d love to help you sort out your mortgage at the best price, with the best advice & great service.

Please get in touch with me so we can discuss your own unique situation and figure out the best, least expensive and most efficient way for you to do it. Family Cover deal with all the main banks and every life assurance company in Ireland, so we know we can organise the best outcome for you. We also remove all of the hassle for you when getting your mortgage together. You deal with one person from start to finish.

Alternatively, pick up the phone and call me on 01-668 6136 and we can organise to meet either in person (our offices are at the Triangle in Ranelagh) or over a Zoom chat.

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**NB – All images used in this article are copyright to their respective owners.

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