Buying a home is now out of reach for the average worker, new figures show

Official data compiled by the Irish Independent reveals that the average three-bed semi-d, which costs €286,611, is out of most workers’ reach if they are buying alone.

A garda in their sixth year at work gets €44,875 basic pay, so could borrow up to €157,062 under Central Bank rules.

A household headed by a garda and nurse, with the same six years’ service, would qualify for a €290,972 mortgage but would have little hope in the capital where prices are close to €500,000.

IT workers who earn €78,583 a year would not get a mortgage for a three-bed semi-d in Dublin unless they had a ­massive deposit.

First-time buyers are permitted to borrow up to three-and-a-half times their gross income and have a 10pc deposit, while subsequent buyers need 20pc, although banks and lenders can make exceptions.

The figures compiled from official salary scales and CSO data show that many workers, including librarians, teachers and lower-paid civil servants would need to share a home loan with another employee. or have a large lump sum.

A surge in landlord-owned homes coming to market has helped cool price inflation but shortages are still pushing prices up to Celtic Tiger levels.

Those who secure a mortgage face the prospect of higher repayments. A succession of interest rate hikes are expected as the ECB attempts to tame inflation.

The price of a three-bedroom semi-d across the country is €286,611 according to the Irish Independent /Real Estate Alliance (REA) Average House Price Index survey.

Sale prices for the most common three-bed family home in Dublin have risen to an average of €493,333.

Dunnes Stores worker Alex Homits (28) who is renting, doesn’t hold out much hope of getting on the property ladder.

“As it stands, I’ll never be able to afford my own home,” he said.

“There is a mentality when people first come here and think there’s a really high wage. I’m in a lot of Ukrainian- speaking Facebook groups and people are looking for housing and find the reality very shocking.

“The country is in a housing crisis. There is no housing, never mind rental accommodation. I had youthful fantasies that I would work my way up but it’s not a goer.

“There are people who stay at home for the bones of 10 years and scrounge and save, but in normal circumstances where you have an active social life – unless you are a very high earner, live at home and cut back on basic expenses, it’s impossible.

“I do have friends from school who bought their own homes, who are staying at home, skipping holidays and not dining out, anything that would upset that delicate balance for years and years.

“People I work with who bought 25 years ago had to pay a much lower portion of their wages.

“I’m renting and it’s pretty much impossible to save unless I started eating beans and toast and didn’t go down to Cork to see my family.”

Ciaran Nugent, an economist at the Nevin Economic Research Institute, said the average IT worker on €1,506 a week or €78,000 a year can apply for a maximum mortgage of €274,000 with an obligatory 10pc deposit.

“This sector is the highest paid in Ireland and yet they would be lucky to get a mortgage for an average three-bed semi-d in Ireland, currently at €286,611 according to the most recent numbers from the REA,” he said.

“In Dublin, where the most recent figures have the average three-bed semi-d going for €493,333, the average IT worker would require €219,000 in cash, equivalent to 2.8 years of their entire gross salary.

“Consider the classic garda and a nurse couple: after eight years, a garda is on just under €52,000. A nurse with similar experience earns on average €41,000, giving them a combined maximum mortgage of around €325,000.

“According to the most recent Daft report, they wouldn’t get a mortgage to cover the cost of an average four-bed anywhere in Dublin, Cork city, Galway city or ­Limerick city.”

Dave Gibney of Mandate said even on the top rate of pay, a retail worker would only get a €101,000 mortgage. “You’d only get a shed for that,” he said. “It’s impossible. Retail workers are in a real trap.”

Public sector workers on incremental pay may qualify for bigger mortgages as they move up their pay scales. However, they would have to wait, and many would still struggle to buy in the capital.

Lenders look at basic contractual pay. The rest – including overtime, allowances or bonuses – cannot be guaranteed as consistent income.