The ever-increasing house prices have now prompted large numbers of young people to scrap their plans to buy a private home and just apply for social housing instead.

Personal finance editor Charlie Weston with the Irish Independent is writing about this.

“The average house is now changing hands for eight times the average salary,” he told Lunchtime Live.

“Remember, the banks are under rules specified for banks and credit unions and other non-bank lenders; you can only borrow four times the income of your households if you’re a couple or single person four times what you’re earning.

“So, how are people doing that? I mean there are those who are on very good wages, they’re on far more than the average wage, and a lot of people are getting help from their parents.

“But large numbers – particularly young people – have decided they just can’t do it, the prices have gone beyond them, so instead they’re going to apply for social housing.”

19/05/23. Minister for housing Darragh O’Brien pictured Opening 25 new social homes with the Iveagh Trust – Swords, Co. Dublin. Pic Stephen Collins/Collins Photos

According to Mr Weston, six-in-ten of those between the ages of 18 and 24 will apply for social housing rather than try and buy a home.

“This was core research carried out for PTSB; only one in four of those who are saving for a house say that they have enough money at the moment for a deposit,” he said.

“The average deposit is about €50,000, which is a whack of a great lot of money and a lot of people just going, they can’t get that.

“Even though one-in-three are getting some kind of a help from a gift or inheritance or from their parents – real ‘the bank of Mam and Dad’ if you like.”

Affordability schemes

Mr Weston said this is despite affordability schemes that have been brought in in recent years.

“You’ve got the Help To Buy, which if you’ve been paying income tax in this country for the last four years, you can get up to €30,000 to put back to use to buy a house,” he said.

“That’s a hell of a whack of money; there’s also the First Home Scheme, which is the State essentially taking a stake in your house with you, so that means that you have to pony up less money."

Mr Weston said the fact that many still feel they have to resort to putting themselves on the list for social housing is a “real sign that the market has moved beyond an awful lot of people”.

Main image: Housing.