A housing crisis can be detrimental to the economy of a country. A housing crisis occurs when the availability of affordable housing is rare and you need a higher income to be able to afford a place to live.
A housing crisis happens due to a change in supply and demand for real estate. If there are a lot of houses with few people looking, housing prices will drop. Likewise, if there are lots of people looking for houses with few properties available prices will go up.
The problem with this system is the availability of housing does not have to do with salaries in the area, so when housing prices go up too much and the income does not change it creates a crisis.
Digital Mortgages can help people get out of the expensive rental market, allowing them to own property.
Why There’s a Crisis
Housing is a big part of a person’s monthly budget. For the typical person, housing should account for about 35% of their monthly income.
When looking at the most recent data from the Central Statistics Office the average monthly income after taxes for someone in Ireland is €2,737. This would leave €958 to go towards housing assuming you pay the full 35%.
The average cost of living in Ireland breaks down into two categories; Renting and buying. The average cost of renting in Ireland is €1,334 per month. This would account for 48.7% of the average person's income, going well over budget.
The average cost paid on a mortgage is €956. This is €2 short of being right on the 35% point.
This paints a very clear picture. It is a very bad time to be renting in Ireland. While buying is not a crisis, it is very close to over the 35% mark making it a crisis.
By getting an online mortgage the path to homeownership is quicker and easier, allowing people to stop renting.
What caused this
The housing crisis essentially started back in 2007 when Ireland’s housing market was going so well that people decided to stop building social housing. This led to a crash which made new housing essentially stop creating more demand than supply.
A graph by the Central Statistics Office shows how the number of houses being built through the years.
This shows that the lack of houses being built is one of the direct causes of the housing crisis. There is simply not enough housing for everyone.
How it affects the people
This affects people because it shows that the average person cannot afford rent. OnlineApplication provides an easy way to apply for a mortgage online. This way people can stop paying monthly and afford their housing again.
How to fix it
There are many steps that can be taken to help solve the Irish housing crisis. Making it easier for people to own property instead of renting can help save people money on their monthly payments.
What OnlineApplication is doing to help
OnlineApplication is a company that provides software to brokers that helps simplify the mortgage process. This software can provide easier access to all documents for the borrower and broker. Keeping all documents safe and secure in one central location. Eliminating the need for face-to-face meetings and loads of paperwork.
The process to apply for a mortgage online has never been easier.
How to learn more
OnlineApplication would love to hear from you if you would like to learn more about our software. To get in contact with us click the link below and we will reach out to you!
Jimmy LaSusa is an intern from the University of Missouri, who is majoring in Marketing. His interests include International Business, Marketing, and Sales.