12 Feb 2011 4:05 PM:
Norman,
To puts things in perspective there are four main categories of buyers. Not a complete list but it seems the more common. There many more scenarios - like a decision tree. But lets keep it simple.
1. Paid Deposit - Could not complete because builder bust / property incomplete etc.
2. Paid Deposit - Decided not to complete because of market crash.
3. Completed - Bought as Hoilday Home.
4. Completed - Bought to resell.
Only those in category three, who chose to complete (and assuming they have no need for a fire sale ) might be considered satisfied. I put myself in that category. BUT if I had deferred my purchase until now I could have saved myself 100,000 Euro for a 2/2 apartment. Having had 10 holiday there, one can reason an opportunity cost of 10,000 Euros for each of those holidays. If I thought about it too much I would be sick as a parrot but hey - 10 of the best, most peaceful relaxing holidays of my life - and we only live once. If I had to sell today I'd be out of pocket by maybe 120,000 Euro's excluding the running costs.
Every category had lost one way or another.
If I had walked away and forgone my deposit I could purchase a similar property today and be Euro 50,000 better off net (allowing for the lost deposit). So maybe I should have walked away in 2007? But then again even I didn't expect the crash to be so significant - yes I was expecting a crash but only by say 15% of so.
You, I read, are category one. You had no choice - you lost your deposit. That's probably worse than category 2. At least those guys get to decide. Many of these category 1 people feel cheated. They thought their deposits were safe. It seems juctice is slow and ineffective. But you know what if I were in that category I still buy an apartment today. And I'd be Euro 50k to the good.
It's the guys in Category 4 who are in the worst case. They can't see at a profit. If they geared with a 60% mortgage that are making signifcant losses selling now. They will not yield much if any rent and they are having to stump up running costs. For those who bought multiple units - they are working hard trying to find anyone to rent the place.
And what about those who fell for the agents pitch about putting a deposit on two or more off plan and then flipping the extra propertie(s) using the 'profit' to fund the one they would complete on? Some people lost 2 or 3 deposits ! That's really painful.
So in a way, almost everybody lost.
But thinking positively -
1) some who completed had great holidays.
2) those who lost their deposit - only lost their deposit. Today there are great bargains to be had with discounts far larger than the value of the lost deposit. So admire the silver lining in the cloud. Of course that's not to say that the market has reached bottom. Maybe it will take another two years to bottom out in real terms. So maybe start saving now and follow the wisdom below - don't buy off plan and find a good reliable lawyer.
This message was last edited by Pete201 on 12/02/2011.
Thread:
How many in the same boat?????
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