Louth first-time buyers now need a €87,750 salary to buy a home

A single first-time buyer in Louth now needs to earn €87,750 to buy a typical first home, according to new research from Chill Insurance. That is more than twice the county's median income of €41,449, leaving a gap of €46,301 between what people earn and what they need.

Louth is the fifth least affordable county in the country for first-time buyers, and the only one of the five outside Dublin and its commuter belt. The local median income falls well short of what a single buyer would need.The research compared the median first-time buyer home price in each county, using the Central Statistics Office's Residential Property Price Index, with median local incomes from CSO earnings data. These figures were then assessed against the standard Central Bank lending rules, under which a buyer can borrow up to 90% of a home's value and up to four times their gross income.

The picture in Louth:

• Typical first-time buyer home: €390,000
• Median income in Louth: €41,449
• Salary needed to qualify for a mortgage: €87,750
• The gap: €46,301

Economist Austin Hughes said:

"With Irish house prices continuing to increase faster than wages, first-time buyers are finding it increasingly difficult to find a property they can afford, not just in Dublin or major urban centres but right across the country.

The Chill report emphasises the nationwide nature of the problem would-be homebuyers face. Even allowing for ongoing wage growth, in no county is the typical first-time buyer property accessible at present to the median wage-earner, unless they are in a position to get additional financial support from the State and/or their family."

Ian O'Reilly, Director of Sales and Operations at Chill Insurance, said:

"In Louth, a single buyer earning the local median income would still not earn enough to borrow what they need for a typical first home. For many first-time buyers, closing that gap means saving a larger deposit, buying with another person or looking at State supports such as the First Home Scheme or the Local Authority Home Loan."

Key national findings:

• No county is affordable for a single buyer on the national median salary of €44,816
• Three counties now need a six-figure salary: Dublin, Kildare and Wicklow
• The five least affordable counties are all in Leinster
• Five counties need salaries above €90,000
• Connacht and Ulster make up most of the affordable list

For the full county-by-county figures, methodology and information on the options available to first-time buyers, see the full report:https://www.chill.ie/blog/incomes-required-to-afford-homes/

Full dataset available here.