Negotiating final price in Rent to Buy scheme

Hi,

There is a 'Rent to Buy' scheme for some very nice semi D's in Galway. The Rent to buy price is 269K. A deposit of 2% is payable up front and 750 rent for up to 3 years. If you buy withing a month you get 20K off price, within a year 10K off price and 5k off within 2 years. All the rent pais id taken off the final price.

This scheme sound great but as house prices are dropping would it be worth negotiating the price? The houses were 345K back in 2007 so have been cut by 76k already. They are quality houses with hollow core and solid wal throughout. Kitchen apps, tiling, wooden flooring on GF and fireplace are also included.

We are really tempted to go for it now as they have stirred up a lot of interest in the area and there are only 6 house available.

Any advice apreciated...

What part of Galway are you looking in?

I live in Galway and nothing selling. Very difficult to know value of a house as asking prices bear no reality to what buyers are willing to accept. If you buy within a month it would be 249k. What area is this ? I see 3 bed semis in Loughrea for 149k 1300sq ft down from 290k in last weeks C tribune. I have seen in a few articles ( David Mcwilliams and Jill kirby ) the value of a house should be 1 Year rent x 14. In your case this would be 126,000.

crabbybear said:

I have seen in a few articles ( David Mcwilliams and Jill kirby ) the value of a house should be 1 Year rent x 14. In your case this would be 126,000.

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While I dont have any source to post I remember reading a piece on David McWilliams - in 2002 he wrote that people should sell up and rent! If you rattle on the same story in an economic forum you will eventually be right!

Apologies slightly off topic.

In an ideal world a house would cost 126K

I would like to like within the 1/2 hour commute mark.

The rent to buy scheme is in Tuam. Fab houses but not sure if I want to like in Tuam! 269K is a lot come to think of it when there are houses getting sold for 150K in Loughrea and Athenry. The quality is better in this particular estate however.

THe house is 1900sqft and is four bed with converted attic.

I would consider looking else where if I were you. There are thousands of empty houses in Tuam. €269 for a 4 bed semi d is a riduculous price in this location.

What estate in Tuam if you dont mind me asking, 4 bed semi d houses were never as high as €345, even in 2007?

The estate is Cricket court on the Dunmore road.

I viewed them about a year and a half ago and the asking price was 345K.

Cayne said:

If you rattle on the same story in an economic forum you will eventually be right!

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If you eat lard constantly and your doctor tells you you're going to have a heart attack, he'll be eventually right too.

What's your point?

If you're suggesting that prices won't drop below 2002 levels, you'll be in for a shock.

To the original poster: if you're paying €750 in rent, then the place is worth €750 x 11 x 16 - €132000. 269K is over double that.

foghorn said:

If you eat lard constantly and your doctor tells you you're going to have a heart attack, he'll be eventually right too.

What's your point?

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Poor analogy.

My point is take what David McWilliams says with a pinch os salt, thats all. I never suggested where house prices are heading.