Even mortgage-approved buyers are 'too high-maintenance' and cash remains king


It’s no revelation that cash buyers have their pick of the dwindling supply of houses on the market in Dublin but we’ve been hearing reports that buyers with mortgage approval are being excluded from the bidding process on some properties.

The feeling is that mortgage holders are just too high maintenance – or rather their solicitors are – and dealing with them involves long delays that some vendors don’t want to contend with.

One industry source knows a couple with mortgage approval who recently tendered a bid that was €40,000 more than the €225,000 asking price for an apartment in Sandymount, Dublin 4. However, their bid wasn’t registered by the estate agent and they were told in no uncertain terms it was “cash bids only”.

“Dealing with a cash buyer is faster and more efficient. While the banks might agree to a mortgage in principle it appears they are finding ways of delaying the actual drawdown,” said the source.

“It’s a seller’s market at the moment due to the lack of stock in Dublin and the end of mortgage interest relief.”

Estate agent Darren Chambers of Lisney says often when buyers with mortgage approval are excluded from buying a property, it’s because there are planning-related issues attached to it.

He says while the banks get a lot of flack for dragging out the mortgage process, the buyer’s solicitor can also be extremely fastidious and can take their time to respond to an issue .

“Solicitors are now, in some cases, looking to have planning permission for extensions built 20 years ago recertified . With a cash buyer there are often fewer complications, if the planning on a property is not entirely resolved, they might take a view on it and decide to go ahead anyway.”

Receiver properties, for example, don’t come with any warranties with regard to planning permission so effectively you buy it as you see it, and so these properties are more likely to be sold to cash buyers.

However, says Chambers, if a buyer with mortgage approval was to offer substantially more than a cash buyer for a property, the vendor might take a chance on them.