“Should I buy a home?”

A READER WRITES: “Should I buy a home in Ireland? My mortgage broker is advising that I buy now, as the market has bottomed out. He is offering me a one-bedroom apartment with paper walls, in a remote suburb of Dublin, for 750,000 Euro. According to property developers I know, prices are going to rise dramatically in the months ahead and ‘now is the time to buy’”

BB SAYS: Of course you should buy a home. The purpose of human existence is to own your own house. That is the reason we were put on this earth. If you take out a 35 year mortgage now, you will own your own one-bedroom apartment in 35 years, and the monthly repayments will probably only cost you about 50% of your disposable income. After 35 years, you can take out another mortgage, and if you live for a very long time (say, for four hundred years), you will eventually own a dozen properties – one to live in, and another 11 holiday homes in picturesque corners of the country.

Any fool can see that the property market has now bottomed out. Unemployment is rocketing. Wages are collapsing. The banks are starved of credit. Rents are falling through the floor. Ireland has the highest household and personal debt anywhere in the world. Multi-nationals are fleeing the country in droves. The country is littered with ghost estates and half-built apartment blocks. By conservative estimates, there are only about a couple of hundred thousand unsold properties in the country. The market capitalisation of Irish banks has decreased in the last year by an average of 97% - because they have borrowed money from foreign banks to lend to property developers, so that they could build houses that nobody can afford. When the banks collapse, taxes will need to increase hugely in order to fund the government’s bank guarantee. Emigration is starting again, the country’s population is in decline. There is massive deflation.

So all perceptive observers agree that property prices are now at rock bottom. Ignore “independent, unbiased advice” from economists and other doom-mongers. Instead, listen to property developers and mortgage brokers, because they know what’s really going on.

750,000 for a one bedroom apartment in Dublin is what is known as “a steal at twice the price”. For 750,000 Euro, you could buy a 12-bedroom mansion in the South of France with a swimming pool and 100 acres of olive trees. Or a 4-bed penthouse apartment in the upper East side of New York. But why would you do that when you can get a one bedroom apartment on the outskirts of Dublin for THE EXACT SAME PRICE? The fact that the walls appear to be made of paper should not deter you – the paper walls allow you to follow the intimate lives of your neighbours, which revitalises community life in our fragmented, isolated modern world.

If you don’t buy now, you will never own your own home. Carpe Diem.