I have often wondered what I’d do if I were a young fella today earning my lowly first wage and looking to get housed in Ireland.
fter much head scratching, I decided that with prices the way the are, there’d be nothing for the younger me (time warped into the present) to do but give up on Dublin, my home town, and go out and buy a pub in a small to medium sized rural town. And live in it. Yes. That would be the best plan.
How did I come to that conclusion? Well bear with me for a bit.
First let’s look at how things used to be for young people in our cities. In 1989, I moved out of the family nest aged 19 and shared a decent two-bedroom top floor flat on the North Circular Road in Dublin 7 with a work colleague.
It cost me 10pc of my earnings. My half was €30 a week at a time when I was earning €300 a week between two jobs. Even though this was the 1980s, for someone with a job there was enough cash left over after paying for a home to enjoy life, buy clothes, take sun holidays and socialise. The way it should be.
Doing those two jobs now (a trade magazine by day, a part time barman job for three nights), I reckon I’d be earning about €650 per week today.
But looking for a two-bed apartment to share in the same area today, I see that the modern young renter me has just three options. In 1989, the small ads of the Evening Press newspaper would have shown at least 10 to 15.
The cheapest place available today, at €1,670 pm has a living room with a ‘kitchen’ with the fridge directly adjoining the fireplace. You’ll be heating up your fridge while it cools your food and cursing it while it blocks the fire.
The next cheapest has a ‘livingroom’ the size of a bathroom. So just one option offers what my old NCR flat had. But it costs €2,400 per month. Split with someone sharing, that would account for €300 per week, almost half of my pre-tax income of €650 a week. No fun at all. Literally.
A year later, in 1990, I moved to my own apartment on a lovely Victorian square in Dublin 6 with its own front door, a kitchen, living room, bedroom, bathroom and storage.
It cost me €50 per week which represented 17pc of my income. I stayed there happily for five years and the rent never increased during that time.
Today its equivalent would cost me €550 per week, or 85pc of the index-linked equivalent of what I was earning at 20. It’s just not plausible. At all.
In the mid 1990s, at age 25, I had one job and was earning somewhat more money. I bought a two-bedroom house. The mortgage cost €440 per month. The price of the house was the equivalent of twice the then average Irish industrial wage.
But recent prices on that same road show that house would cost me the equivalent of 11 times the average industrial wage today.
My older self today couldn’t afford to buy that house were it half that price. The bigger picture is crazy.
In fact, my 25-year-old earning €650 per week with a deposit saved, would today end up being completely priced out of Dublin altogether, for both rental and purchase, on all fronts and in all locations.
So what would the 25-year-old me do today? First I’d be very angry indeed at the Governments which have enabled this lunacy and those who voted for them. Then I’d have to work with the reality.
There’s no way the 25-year-old me would stay living at home with mum. Nor renting a tiny run down flat with no money left over, nor sharing a bedroom with another adult in a house split.
There’d be no other option for me but to move out of my city and work remotely. And I’d want to buy a property. But to where and what would I buy?
I never fancied living in a remote area so it would have to be a town. My maximum budget with a deposit saved on that €650 per week (just over €32k per annum) income with savings would be somewhere in the order of €125,000 to €130,000.
And even in small towns, three bed houses cost twice that. A one-bed apartment in Leitrim today costs €125,000. So I’d have to think outside the box.
And so I’d buy myself a pub if I could get a mortgage on it. Here’s why.
Let’s take two towns, Castlerea in Co Roscommon and Kilrush in Co Clare.
In the former, I can buy a two-bed house or cottage for €130,000. That’s my upper limit as a young city dweller on a reasonable income. For €50,000 I could buy a shop with two-bed living accommodation overhead.
The only problem is that most affordable shop buildings off main streets in Irish towns are small, averaging about 900 sq ft over both floors. Many tend to be in poor condition structurally, especially on the upper floor and with shop windows at ground level, they’re not terribly secure.
On the other hand, I can buy a pub in Castlerea for €125,000 today. For that I can get a handsome 2,800 sq ft mid-terrace period building with good three bedroom living space overhead. There’s a yard at back and parking there. The building is in good condition.
I can live here, overhead in its three-bed house on the upper floor at the centre of a reasonably busy town. And I can work remotely from my new pub.
The pub business in Ireland is on its uppers and this is especially true of regional towns where there could be a dozen pubs struggling and only a handful sustaining themselves.
So now there are pubs in towns all over Ireland that can be bought for €125,000 or less, the price of that one-bedroom apartment in Leitrim.
I’d look for a pub where the previous owners had lived overhead. The whole point here is that the residential accommodation has been used and therefore well kept.
Few people want to run these buildings as pubs (as evidenced by the prices), they’re no use as shops and locals generally don’t want to live in them.
So town pubs off main trading areas with good living spaces are for sale nationwide for half the price of the local houses and with twice as much floor space. Right now there are more than 20 town pubs, with residential accommodation the size of a large family hone, for sale around Ireland for less than €150,000.
So now to Kilrush in Co Clare. Here a three-bed detached house will cost me €380,000 or a three-bed terrace house will cost me €180,000. Both are out of reach for a 25-year-old borrowing on an average wage. But again for €125,000,
I can buy a pub in Kilrush with space of 2,260 sq ft (more than twice the size of the average semi-detached).
This is an attractive town by the sea and the Shannon estuary. I could work here remotely and at weekends travel back to the city meet my family and socialise. This option would work for young couples as well.
So what will I do with the lounge and bar downstairs? In some towns there might be potential to rent it out for pub use or for a cafe business in busy months. Maybe re-purpose it as a remote working hotspot.
But none of that really matters to the 25-year-old me. I can leave the lounge/bar to cobweb over. The point is, as a young single or part of a couple, I can at least own a family-sized urban home.
Having read all this you’ll likely say “that’s a completely crazy idea for a young city-born person in their 20s!” Yes it is.
But the fact that an average earning Irish 25-year-old’s options for buying a good sized urban home are now restricted to residential pubs and shops in regional towns? Well that’s a far crazier concept to behold. Because other than that, they literally have no homes to go to.