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Buying your first home is a bewildering and frustrating experience in the current economic climate. Unfortunately Irish housing prices and the economy are similar to the uncle who fell asleep at your wedding reception - they have stayed too long at the dinner table. 

Both are growing at an unprecedented rate and property supply is not keeping up with demand. Many couples who once assumed they would own a house within a year or so of marriage are now forced to rent an apartment or flat for longer than expected. If you decide to hop on the property merry-go-round, be patient and keep these few simple facts in mind: 

Average Property Prices - Yikes!
According to the Irish Auctioneers & Valuers Institute (IAVI) the average price of a new home in Dublin increased by ninety-four per cent from June 1996 to June 1999. Nationally, it increased by seventy per cent over the same period. The average price of a new home in Dublin in 1999 was £147,301. This figure fell to £113,299 when the entire Republic was considered. 

Increases of twenty to twenty-five per cent are possible for this year although increasing interest rates and inflation may slow growth. Second-hand houses were even more expensive in 1999, racking up an average of £160,839 for Dublin and £125,582 nationally. 

Sale Methods: Auctions and Private Treaty
The IAVI says only six per cent of properties are sold through auction although these are the ones that tend to make headlines. The majority of homes are sold by private treaty. Using this method, bidders are required to place their suggested buying price in a sealed envelope and send it to the auctioneer (estate agent) by a certain day or time. The property should go to the highest bidder unless the bid is conditional on the sale of another home. In many such cases, a lower bid with no conditions is accepted instead. 

Gazumping
A property sale is not legally binding unless contracts have been signed and exchanged by both the buyer and seller. An unfortunate practice called "gazumping" sometimes occurs during the period between verbal acceptance of the offer and the contract-signing. In this situation, the seller accepts a higher offer from another bidder prior to the expected signing the original bidder's contract. 

Commissions and fees
In a normal situation, the sale agent will ask for a five per cent deposit. Solicitors that perform conveyancing for the property usually charge one per cent of the sale price plus £100, plus VAT of twenty-one per cent. The client should try to negotiate this charge down by twenty-five to fifty per cent. 

Auctioneers fees vary but may be negotiated, particularly if they are handling both properties. Clients should never agree to pay for advertising at the full rate as most auctioneers have bulk deals with newspapers and magazines. If the sale is unsuccessful, the auctioneer should consider a refund of the client's advertising fees although they are not required to do so. 

Mortgages
Most purchasers rely on banks and building societies for mortgages. Lenders use a rule of thumb for determining the mortgage level - three times income for a single person and for joint applicants two and half times the higher income plus 100 per cent of the lower income. Normally the buyer is expected to put up ten per cent of the purchase price as a deposit. 

The average mortgage term is twenty years and variable and fixed rate loans are available. Although interest rates are creeping back up, they are still at a low level compared to those on offer just a few years ago. 

Most newspapers carry a weekly summary of interest rates offered for both new and existing bank and building society customers. The Irish Times property section, which appears on Thursdays, includes a list of rates and timely articles on the property market. 

Before taking on a mortgage ensure that the rate offered is not just an introductory rate and that it will be valid for the term of the loan. In the case of variable rates, some lenders now promise that their rate will never be more than a certain number of percentage points above the European Central Bank. Unfortunately, this is also a limited offer. 

Government Charges
In addition to solicitor's, auctioneer's and surveyor's fees, the government receives a slice of the property's price. Stamp duty is payable on second-hand residential properties and it ranges from zero to nine per cent depending on the price of the home. From April, 1998 for example, a home costing between £170,001and £250,000 will incur a duty of five per cent. 

Newly built homes are not subject to stamp duty if the purchaser occupies it for five years and it is under 125 square metres or 1,346 square feet in size. 

Rental Prices
Those uninterested in purchasing a home can always rent a house or apartment. Prices in Dublin range from £700 to £1,200 per month depending on the quality and proximity to the city centre. Apartments may be rented for between £500 to £1,000 a month. Outside the main cities of Dublin, Cork, Galway and Limerick prices are significantly lower and the choice is greater. 

Suggested Websites
"http://www.irishpropertynews.ie"
"http://www.iavi.ie"
"http://www.emigrant.ie"
"http://www.pwcglobal.com/ie"
"http://www.irlgov.ie"