Buy now or wait and see?

With some segments of the market cooling, it's always wise to go by location, says Jane Suiter

Apartments and starter homes are springing up all over the countryside. Developers and estate agents are gearing up for one of their busiest ever spring selling seasons as thousands of 20 and thirtysomethings are poised to finally take the plunge and put a bid in on their first home.

But is this a good time to get into the market? Or is it a better idea to hang on and wait and see what happens to prices later in the year? Ask any estate agent and they will have one word - jump. Wait even six months and the price could have rocketed, they warn. But is this reality or merely estate agents talking their own book?

It is certainly true that most people who have held out over the last decade have either seen prices soar out of reach or have had to swallow the bullet and pay more than they were hoping to. There has not been a sustained drop in Irish house prices in recent decades and, given property's unique attractiveness as an investment where you get to make a return on your money, save on rent and get somewhere to live, this may well continue.

The own dark cloud is the repeated warnings from the likes of the Economist that a bubble can never be positively identified until after it has burst.

Nevertheless, most economists and market watchers expect prices to continue rising for most Irish homes over the next year. Up to 80,000 new homes are likely to be built again in 2005. But with the CSO predicting continued inward migration of over 40,000, many of these will be automatically accounted for.

The revised immigration numbers have even ensured that some of the biggest pessimists about the housing market are currently redoing their numbers. But the trend is by no means the same for all types of property or indeed for all areas.

Already, apartment price growth has slowed right down as the number of new blocks grows almost exponentially. The prices of starter homes in some commuter areas are also bumping along with no increases. And if inflation is taken into account, some developments have already seen slight falls.

With the Budget cutting stamp duty for second-hand homes for first-time buyers, there is likely to be even more pressure on prices of new apartments.

This does not mean, however, that the price of that dream apartment or townhouse you have your eye on will come down. After all, hundreds of other people probably have their eye on the same property. But it may mean that the extras will improve. The developer may throw in curtains or carpets or a fully fitted kitchen. The days of walking into your apartment only to find an empty box with concrete floors may well be over.

And if the home you have set your heart on is part of a big scheme, it is even possible that those sorts of deals will be even better after the summer when the initial phase of the selling season is over. So should you bite the bullet and hold out for a better deal? The answer, as with all else relating to property, is all to do with location.

Even estate agents privately admit that the prices of some schemes on the outer edge of Dublin's commuter belt are likely to find prices under pressure. City centre homes and those close to good transport links are not, but few are predicting double-digit growth or anything like it. In contrast, even the most pessimistic observers believe that prices in Dublin's more established suburbs are likely to rise.

And of course the sums are very different for those living at home with their parents and those already in the rental market. Anyone paying a large amount of "dead money" to a landlord obviously stands to gain more by getting into the market early than someone with the comfort of being able to afford to sit back and observe for a while.

But you should also think carefully about moving out of rented accommodation in an area you enjoy to buy somewhere far more distant. Location is life changing and it is often far cheaper to rent somewhere than to buy there. After all, how many first-time buyers can set their sights on Waterloo Road?

Many make the mistake of assuming that life in the suburbs will be easy and find too late that their new home is so distant their social life is killed off. Others believe that living in a tiny apartment will feel right but, somehow after the larger flat, it is only claustrophobic.

So it is vital that you buy somewhere that you will be able to bear living in. After all, if you're still there if and when the property market does finally stall, you may be stuck for longer than planned.

But, of course, the problem with waiting is that you may miss out on the home of your dreams. Probably the best advice is to buy when and where you feel comfortable and when you have money in the bank. But, remember, unless you're chasing something very special it certainly doesn't look like a last chance saloon.