Renting in Ireland is a major financial consideration but thankfully the economy and salaries are improving. The cities, especially Dublin, are the most expensive so you may want to consider choosing a home in a commuter region. According to a recent CSO survey, the average rent on a two-bed apartment is around €1,200 per month in Dublin, €800 per month in Cork and €750 per month in Galway. It’s essential that you’ve done your research and set a realistic budget for where you’d like to live. Use services like MyHome.ie in the Republic of Ireland and Propertynews in the North to identify options and reach out to landlords.
There is lots of competition for affordable accommodation in Ireland at present, especially in Dublin. If you find a room, apartment or house that you are interested in, arrange a viewing as soon as possible. Ask the landlord what documentation is required in advance and get your references, proof of employment and deposit in order. This means that you will be ready to sign the dotted line if you are impressed at the viewing. Make sure you ask about the average cost of bills per month so you have a clear idea of how much your accommodation will be setting you back in total.
Landlord and tenant rights
The length of time between rent reviews has been extended from 12 months to 24 months, thanks to a new law signed on 4th December 2015. This has been welcomed with open arms by renters as it greatly reduces the risk of landlords being able to increase prices without fair notice. The new law also states that if a landlord is reviewing your rent, they must give at least 90 days’ written notice, instead of 28 days which it was previously.
Mortgages and borrowing
Elevated rents mean that you might want to consider buying a property – mortgage repayments are often cheaper per month than rental costs. The first thing you have to remember is that most banks will only lend you money if you have been working for six months and have passed your probation period. After this, you will need to prove that you have the required deposit and can make your monthly mortgage repayments.
So how much will your deposit be? This depends on whether or not you have purchased before. First-time buyers will need a deposit of 10% on properties valued up to €220,000, and 15% for properties worth more than that. First-time buyers can also avail of a tax rebate of up to €20,000 to fund their deposit. If you, or a partner, have purchased a home before you will need to have a deposit of 20%. Non-resident purchases of properties have a higher deposit rate of up to 40% and a higher rate of interest. Even if you’ve been saving overseas, this can be very high.
Borrowing guidelines have changed in recent times, and may be quite different than you remember. Borrowing is restricted to less than three and a half times your income for roughly four out of five borrowers. The new rules from the Central Bank restrict mortgage lending but ultimately mean that the more capital you put into your property upfront, the lower the overall price will be. This is good news for those who plan on transferring large savings from America or the UK, as they can enjoy excellent conversion rates to the euro at present. The new mortgage lending limits are not absolute in all cases – banks will have the discretion to ignore the rules in 20% of cases with multiple incomes, and 15% of loan-to-value mortgage cases.
Buying a property in Ireland
The process of buying a home in Ireland can be lengthy and costly, involving legal fees, stamp duty and registration of deeds. If you’re planning on buying a home, make sure you will be in Ireland for a reasonable length of time – otherwise it might not be worthwhile. Using a mortgage broker can be a good idea if you are intimidated by the process and want advice about getting the best deal.
The easiest way to find suitable properties is by searching property websites like Myhome.ie where you can set up alerts to suit your criteria. When you view properties, there are a few things you need to take into consideration, including:
- The property’s Building Energy Rating, which will indicate how energy-efficient it is. You will need to consider additional electricity and heating costs if the rating is low.
- Any work that needs to be done on the property and these additional costs. You should obtain a property survey from a chartered surveyor.
- Whether the property is in a High Radon Area – use the Environmental Protection Agency Radon Risk Map to determine this.
- The price that was paid for the property if it was bought since 1st January 2010. You can find this out on the Property Services Regulatory Authority’s Residential Price Register.
- The percentage of stamp duty that will need to be paid – this will be 1% on new homes under €1 million.
- Property trends as outlined by MyHome.ie