Sir, – Fiona Reddan's "Sorry, Millennials: Buying a home was just as hard as your parents" (November 15th) is a largely well-researched piece of writing but omits a fact reported by your own newspaper last week, that rents have risen to their highest point on record.
Comparing the percentage of gross income required to service a mortgage in different decades fails to address the point that saving for a deposit is made impossible for a growing cohort of millennials because of the Government’s complete failure to tackle this spiralling cost. – Yours, etc,
OSKAR PERSSON,
Sandyford,
Dublin 16.
Sir, – Fiona Reddan does mention in her introduction zero-hours contracts, but does not address how difficult the more precarious nature of employment today makes it difficult to get a mortgage, and difficult on a personal level to committing to one.
She makes no mention of rent prices, therefore failing to recognise the challenge of paying staggeringly high rents in Dublin and other urban centres whilst also attempting to save for a deposit.
The fact that houses are in extremely short supply does not get a mention, so even those of us who have jumped the previous two hurdles, ie saving a deposit and finding a permanent job, struggle to find suitable properties to buy.
As a returned emigrant, allow me to take this opportunity to thank the Government for a tax rebate I can’t avail of to buy new-build houses that don’t exist.
I pay €600 per month for a single room in a small apartment. I have a decent job right now, but the contract is up in January, and who knows what will happen then?
It’s not where I pictured myself at 28, and the sad part is I’m probably considered one of the lucky ones.
Millennials did not create the housing crisis. We didn’t squander the Celtic Tiger. We are doing our best. – Yours, etc,
KATIE HARRINGTON,
Dublin 1.
Sir, – Fiona Reddan puts forth numerous reasons why the current generation are significantly worse off relative to the “boomers”, then entirely counters that position with the simple argument that, when one adjusts for the different prevailing interest rates of the two eras, “This changes the scenario significantly”.
However, the article makes a critical error in considering nominal interest rates rather than real interest rates. That is to say that the interest rate is not adjusted for inflation.
Between 1976 and 1986, inflation in Ireland was significantly higher than in recent times, peaking in 1981 at 20.4 per cent. This is an ideal scenario for undertaking debt to purchase a housing asset; inflation will erode the real cost of the repayments and also increase the value of your asset.
In contrast, recent years have seen a number of periods during which Ireland has even suffered deflationary periods, entirely a more difficult scenario to undertake a debt-funded asset purchase.
It is obvious that the boomers who bought property in the 1980s fared far better than the generations that followed. In many respects, it is a broad misunderstanding of the crucial importance of inflation in this outperformance that has led so many subsequent house-buyers into financial stress. – Yours, etc,
JOHN DRUMM,
Sandymount,
Co Dublin.