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 Post subject: Affordable has a definition €320,000
PostPosted: Sat Sep 15, 2018 1:33 am 
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Fresh from setting up a quango to develop housing on state land the Minister, Eoghan Murphy, slipped us his thoughts on what 'Affordable Housing' means.

https://www.irishtimes.com/news/politic ... -1.3628555

Quote:
Homes classified as “affordable” and provided through the new Land Development Agency (LDA) would cost some €320,000 in Dublin, Cork and Galway under current market prices, Minister for Housing Eoghan Murphy has said.


These people (Varadkar Donohoe and Murphy) are insane. :(

Quote:
The aim of the new agency is to provide 150,000 new homes over 20 years. Any developments built on State lands must have 30 per cent of affordable homes, in addition to the existing 10 per cent already needed for social housing. The target is to eventually have half of all such developments allocated for social and affordable homes.


This means, of course, that the rest of the properties built on state land in Dublin, Cork and Galway will cost at least €321k per unit. These morons in government probably hope for an average €500k for the 'non affordable' bits.

It also means that every chancer of a developer who sells homes in Dublin for more than €320k can advertise them as 'affordable'....because this nonsense is now official.

The housing crisis has driven the lot of them pure mad at this stage. :(

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 Post subject: Re: Affordable has a definition €320,000
PostPosted: Sat Sep 15, 2018 6:00 am 
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So to meet the LTI for a mortgage on one of these 'affordable' properties you would need an income of over 80k (and savings of at least 40k to cover deposit and fees), not sure how affordable that seems tot the average person!


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 Post subject: Re: Affordable has a definition €320,000
PostPosted: Sat Sep 15, 2018 6:19 am 
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IIRC DCCs previous low income definition was under 55k


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 Post subject: Re: Affordable has a definition €320,000
PostPosted: Sat Sep 15, 2018 6:25 am 
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Average income of one full time and one part time worker in Dublin was about 76k in 2015, so 80k is about right for 2018.

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 Post subject: Re: Affordable has a definition €320,000
PostPosted: Sat Sep 15, 2018 4:57 pm 
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Do you really believe that the majority of households have an income of 80k+?
Averages can be defined in so many ways.


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 Post subject: Re: Affordable has a definition €320,000
PostPosted: Sat Sep 15, 2018 5:23 pm 
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NorthDub Paul wrote:
Do you really believe that the majority of households have an income of 80k+?
Averages can be defined in so many ways.


It certainly surprised me. If somebody asked me to pull a figure out of my behind for a median 1 full + 1 part time income, I'd have guessed at something like €65K. (say €40K + 25K or €45K + €20K)

€80K assumes two full time incomes at median or a bit above. OK, there are a lot of households that do have this, but is it really the most representative? I would expect something more like 1.5 than 2.
Edit: Actually, that's median salaries/wages, not incomes. There are plenty of people relying on benefits for a large proportion of income, who will often get a lot less.

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 Post subject: Re: Affordable has a definition €320,000
PostPosted: Sat Sep 15, 2018 7:33 pm 
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If you have a better source of stats than the CSO then post them.

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 Post subject: Re: Affordable has a definition €320,000
PostPosted: Sat Sep 15, 2018 8:44 pm 
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Eschatologist wrote:
If you have a better source of stats than the CSO then post them.

Central Bank, produce average income figures for those drawing down a mortgage.

IIRC correctly the average household income in Dublin is close to 100k.

The harsh reality is the poor do not own their own homes - this applies just about everywhere in the world.


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 Post subject: Re: Affordable has a definition €320,000
PostPosted: Sat Sep 15, 2018 10:30 pm 
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Luan wrote:
Eschatologist wrote:
If you have a better source of stats than the CSO then post them.

Central Bank, produce average income figures for those drawing down a mortgage.

IIRC correctly the average household income in Dublin is close to 100k.

The harsh reality is the poor do not own their own homes - this applies just about everywhere in the world.



Nevertheless, the poor still form households.

Is that €100K a mean household income, a median household income, a mean household earned income, a median household earned income, a mean owner-occupier earned income, a median owner-occupier earned income, or what?

The gulf between €100K and the median industrial wage of about €39K is very odd, considering that there are lots of people on benefits getting much less than that and relatively few people like Luan's cleaner who find €80K pa in loose change down the back of the sofa. :wink:

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 Post subject: Re: Affordable has a definition €320,000
PostPosted: Sat Sep 15, 2018 10:43 pm 
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Luan wrote:

The harsh reality is the poor do not own their own homes - this applies just about everywhere in the world.

These days many middle income earners are also being priced out of property, we're returning to the old days when only the wealthy could afford property.

Unless you live out in in rural areas far away from the high paying jobs.

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 Post subject: Re: Affordable has a definition €320,000
PostPosted: Sat Sep 15, 2018 11:15 pm 
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Madness of Crowds wrote:
Luan wrote:
Eschatologist wrote:
If you have a better source of stats than the CSO then post them.

Central Bank, produce average income figures for those drawing down a mortgage.

IIRC correctly the average household income in Dublin is close to 100k.

The harsh reality is the poor do not own their own homes - this applies just about everywhere in the world.



Nevertheless, the poor still form households.

Is that €100K a mean household income, a median household income, a mean household earned income, a median household earned income, a mean owner-occupier earned income, a median owner-occupier earned income, or what?

The gulf between €100K and the median industrial wage of about €39K is very odd, considering that there are lots of people on benefits getting much less than that and relatively few people like Luan's cleaner who find €80K pa in loose change down the back of the sofa. :wink:

2 x median industrial wages is a household income of €78k :)


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 Post subject: Re: Affordable has a definition €320,000
PostPosted: Sat Sep 15, 2018 11:57 pm 
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Luan wrote:
Madness of Crowds wrote:
Luan wrote:
Eschatologist wrote:
If you have a better source of stats than the CSO then post them.

Central Bank, produce average income figures for those drawing down a mortgage.

IIRC correctly the average household income in Dublin is close to 100k.

The harsh reality is the poor do not own their own homes - this applies just about everywhere in the world.



Nevertheless, the poor still form households.

Is that €100K a mean household income, a median household income, a mean household earned income, a median household earned income, a mean owner-occupier earned income, a median owner-occupier earned income, or what?

The gulf between €100K and the median industrial wage of about €39K is very odd, considering that there are lots of people on benefits getting much less than that and relatively few people like Luan's cleaner who find €80K pa in loose change down the back of the sofa. :wink:

2 x median industrial wages is a household income of €78k :)


We've been through that before. Not every household has two full time earners.
If we're generous to you and assume the median is 2x average wages, then there must be plenty of households with >2x median wages to get up to that median, so how many HMOs have owner occupier mortgages? Anyway, even if the households with 2 wages have a median earned income of €78K, and remembering that as well as knowing that plenty of households don't have two full time earners, and that there are also households with proportions of their income deriving from benefits, on significantly less, where does this €100K come from? Even after you've given the figures a generous massage, you're still 22% short. :?

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 Post subject: Re: Affordable has a definition €320,000
PostPosted: Sun Sep 16, 2018 6:10 am 
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Average earnings for FULL-TIME employees is €57,384.

Two people on average, full-time earnings will be comfortably able to purchase a €320k property. Remember - houses tend to be bought by couples at a time when both are in employment.

A €280k mortgage is €1325 pcm at 3% over 25 years. This is manageable even if you have just one person in the household on average earnings.



The outrage about affordability is mainly driven by journalists and NGO types, basically people in low-wage industries who all have to live in Dublin.


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 Post subject: Re: Affordable has a definition €320,000
PostPosted: Sun Sep 16, 2018 7:04 am 
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@Madness the CSO-derived figures I quoted were for one FT and one PT in Dublin. I would assume that most couples are both FT when they apply, the CBI rules give enough breathing space for one to drop down to PT and still afford the mortgage. Or even one be unemployed.

I find it a bit weird on these threads the constant reference to national average wages, but I guess it's probably because the CSO are really bad at producing regional income numbers. Both prices and incomes obviously differ massively between Dublin and ex-Dublin.

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 Post subject: Re: Affordable has a definition €320,000
PostPosted: Sun Sep 16, 2018 7:07 am 
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Regardless, the question of who affordable homes are targeted at is a good one.

As is whether their sale or resale to investors should be allowed.

Arguably we only need enough demand to drive the necessary construction activity and it doesn't matter who buys them.

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