20% Mortgage Deposits – There really is no Place like Home

There’s no place like home, apparently.

But thanks to the latest plans from Central Bank it looks like I’ll  never figure that out for myself.

Of all the stupid ideas to be considered (even counting the privatisation of Irish Water), 20% mortgages has to be the worst of them. A monkey’s fart could probably consider the economic circumstances in this country and come up with something better. But no, the same bloated middle-aged vogons that got us into the mess in the first place – having abstained from offering any real opinion or action regarding regulation when we actually needed them to – are currently patting one another all self-congratulatory on the back, for swooping in seven years later, to save the day… just when things were getting better. 

Well, fuck you.

When I decided to actually stay in this country – unlike literally, 52% of my friends (I did a Facebook count) –  I was prepared to tough it out. Because I loved it here. I love being near my family. I love Dublin. I love Ireland. I believed in a country that could get back up on it’s feet again, with a new better set of values and a brave new attitude that took a different sort of set of risks, for the better. One that could shed the coat of old green plastic Guinness-stained paddy-whackery and show the world just what a small island can do on a global stage. I wanted to be part of that.

So I went back to college, like I was told to, when I realised my arts degree was the academic achievement equivilant of toilet paper. And morning to evening of my masters, I lived off five euro a week, often less. It was hard. There were days I was hungry. It was not a good time. But I was lucky enough to be amongst a few who got work (again, over half of them left when even a masters wouldn’t find them an unpaid internship).  I began to pay off the hefty student loan right away.

I paid it off while barely above minimum wage.

I paid it off when my rent rose, twice.

I paid it off instead of holidays.

I paid it off instead of health insurance.

I  even managed to pay it off while I was out of work.

Then finally, it was gone. And literally the same week, the media started to cautiously whisper about financial recovery. Could this be it? Were we OK now?

So I did what I was told again and started to save a fifth of my wage every month.

I started to get excited about the prospects of buying a home in 2016. Something to call my own. Something I could make plans in. And paint – anything but ‘rental beige’. And not have to put up with shitty things not working. And have a dog. Or a cat. Sure, why not both? They’ll just have to put up with each other! Something with a little garden… And a kitchen I could actually cook in! Something that wouldn’t mean throwing money down a hole every month.

Incidentally, through my twenties, I’ve paid out over €35,000 in rent and PS the rent just went up again by another €200 this time.

So yeah, I was excited at the prospect of getting out of that cycle.

Now I’m just beyond pissed off. I’m livid.

Because Central Bank have just thrown down the economic equivalent of a rock on top of my head. 20% on a home? On a home in Dublin? And only three times my salary approval? I will be in my late THIRTIES before I can have any kind of home now.

Meanwhile, the rental market will continue to spiral out of control. And even if it didn’t (which it will, because everyone else I know will be shackled to their beige rental apartments too), I’ll have paid out at least another €42,000 in rent. So it will only get harder and harder for me to save. The rich get richer, and the rest of us are left to haemorrhage the funds for them to do so.

No I don’t have some rich eccentric old aunt or a over-indulgent Daddy who’s going to hand me the money either. The only people that benefit from this are the super rich and the multi-property investors. The same people who royally fracked everything up for us in the first place.

And what if I wanted a family?

Nothing I’ve read seems to have considered that for a moment.

This is hitting would-be first time buyers – so you’re typically talking about a decade long impact on people in their mid-twenties to early thirties. What about everything else that’s going on in their lives in the mean time?

We are supposed to save a 20% deposit, while paying hiking rent charges, while dealing with the most expensive time in our lives? The average annual cost to raise a child in the States is around $18,500. That’s for just one child. I’m no expert but I’m going to go out on a limb here and guess having kids here ain’t exactly cheap here either.

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And no, again I’m no expert, but I think that it makes sense that costs of city living will rise. It’s a pattern we easily recognise if we look both East and West. People will continue to migrate to the cities. Every economist worth their salt says so. Not just here, globally. It’s one of the only thing economists don’t dispute. As long as Dublin continues to have work (i.e. keep all those techy companies etc. happy) and doesn’t ‘become a Detroit’, the balance will continue to tip even quicker here.

And just what would I be saving for anymore anyway? 

Because my original starter plan home isn’t exactly going to suit a 45 year old woman with teenage kids and a deranged dog and cat, now is it? (The cat’s negotiable, the dog isn’t)

So what exactly am I saving for? 

And that’s where it all just gets a bit scary. Because if the 20% rule comes in for first time buyers*, Central Bank will be making saving for a mortgage the psychological equivalent to a twenty-something year old, of saving for a pension.

And we all know how well that’s going.

I believe, like pensions, the incentive to save for a mortgage will just become too distant, too illusive for many would-be first time buyers. The factors effecting the outcome over that time, too varied.

Because you’re more likely to succeed at a goal if you can visualise what that goal is – exactly just what it looks like. Whether that wisdom is being peddled out in Oprah’s self-help book lists or packaged for the middle classes in the likes of ‘The Power of Habit’, or the sports strategies of Olympic gold winners, or by a machiavellian chief whip in House of cards… that wisdom rings true. If we want to start training for a marathon, learning Chinese, planning a music festival, changing our eating habits, reaching the top of the corporate ladder, or saving for a home, we all need to a clear visualisation of success, in order to take the steps to achieve our goals.
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And I just can’t see my little house anymore. I don’t know what it could look like. Hell, I don’t even know who I will be in a decade. Millenials live in a period of total uncertainty. We’re used to it. It’s made us entrepreneurs (supplying more than half the jobs – more fixing on your behalf, thanks). But as I cancel my Netflix, UPC, gym, spotify subscriptions and ditch my health insurance to pay for the my rent hike, you have to wonder how far you can make us jump and leap.

We live in the most unequal world in the history of human kind when it comes to the distribution of wealth. Think about that for a second – a medieval serf would have experienced less imbalance than you do today. A world were the businesses doing best in the last decade are those that serve the super-rich and who’s only ‘service’ to the super-poor is to keep them firmly in depth. It appears we have learnt nothing from the last few years. In fact, it appears we want to be the god damn poster-boy for inequality.

As for the rest of us left behind – there is no clear yellow brick road to follow and certainly no magic ruby slippers.

Hmm, there’s a thought, maybe I’ll just throw it all on shoes instead. Ain’t nobody coming after my shoes…

 

By the by, here is the latest update on my rental apartment… http://www.irishexaminer.com/viewpoints/analysis/is-this-apartment-block-the-next-priory-hall-311205.html
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