If you are living in Dublin and renting it is likely it could take you as long as 21 years to save just to get the deposit together for a house.
Research carried out by Prosperous Financial using figures from Daft.ie, numbeo.com and other respected sources has found that Dubliners earning the average wage (€36,919 per annum) are left with just €127.24 per month after covering rent and living expenses.
Given that the average price of a house in Dublin city centre is €325,671 and using the central banks lending rules for first time buyers it means you will need a deposit of €32,567 to buy the same house.
The average worker in Dublin is only left with a measly €127.24 per month to save. This means it will take them 21 years to get the deposit together. What is worse is that this assumes the average house price won’t have increased in 21 years’ time.
This further highlights the plight of people trying their very best to get on the property ladder, but it also highlights the difference between Dublin City versus Galway or Cork City.
Although the cost of living is similar in each city, in fact they are within €100 per month of each other with Galway costing a single person €748 per month versus Dublin costing €848 per month, it is the cost of rents that really shows the differences between the 3 major cities.
According to Daft, rent of a 1 bed in Dublin will now cost €1511 per month versus €897 in Cork and €815 in Galway city centre. This difference is what really eats into the ability to save.
Combining this with the cheaper cost of housing in Cork and Galway results in the average Cork singleton having to save for 3 years for the deposit and the average Galwegian only needing 2 years, but if you want to live in Dublin it is going to take you 21 years to get there.
The reality is that house prices won’t be the same in 21 years’ time and even if they were who is going to be willing to save 21 years to buy a house. So, people need to take whatever opportunity they can to become “better than average”.
One key thing to that is getting help, support and advice from people who are trained to give it. “This Crowded House” a TV show on RTE2 is going into it's second series and provides the support people need to get that edge and to make the absolute most from their own situation.
For example, in the research done by Prosperous Financial which found it could take as much as 21 years to save for a deposit for a house in Dublin, it was assumed that the person would save in a deposit account, thus getting deposit like returns. But with a bit of advice that person could achieve a better return over the long term by investing wisely. Even if they only got 4% per annum (net) this one little change alone would knock 6 years off the length of time required to save for a house.
15 years to save for a house is still unacceptable but it does prove a point, if this one improvement knocks six years off, what if you were getting advice on other areas of your finances, or you had Brendan Courtney and a team of researchers helping you out on your quest to try and move out of your parent’s house.
In the show Brendan Courtney has a team of experts around him to ensure the people taking part have the best possible chance of getting sorted in what must be the most difficult time for any generation to move out of home.
Last year the show, which is currently being re-run on RTE2 on Tuesday nights at 21.30, helped some people move out of home, others build granny flats and some even got mortgage ready.
The show is now looking for people to get involved for series 2. If you are living at home and want to move out and want the best of advice and support, then you should get in touch with Indiepics by emailing firstname.lastname@example.org or calling 017088181.