104,000 investment properties sitting vacant

mentalson

http://www.ireland.com/newspaper/property/2006/0608/512065133RPHOLDEN.html

"There are currently 104,000 investment properties sitting vacant around the country, and these are not holiday homes . . .



Surely if this statistic from the Irish Times is correct it is significant. It means that many speculators are holding on to properties purely for capital appreciation and the builders arguements about supply not yet meetin demand are bull****. If prices take a downturn will they continue to hold on to their vacant investment properties.

miju

i raised this point on the stickied thread, my guess is a good few will try and hold their nerve but the rest will try and bolt for the nearest exit,

here's a question i've just thought of , if all the speculative buyers / landlords sell where does that leave alot of tenants?

Lex Luthor

miju wrote:

here's a question i've just thought of , if all the speculative buyers / landlords sell where does that leave alot of tenants?

there's another 104,000 houses for them to choose from....;)

whizzbang

Does anyone know where this figure comes from? I'd love it to be true but I am reluctant to just believe it. Could this be slanted by investors saying ther is nobody in there property to avoid tax?

indiewindy

It could be that allright, but its some risk to take paying a mortgage on a property that your not even getting a rent on, betting on prices continuing their steep upward spiral

Lex Luthor

indiewindy wrote:

but its some risk to take paying a mortgage on a property that your not even getting a rent on

its a HUGE risk

The_Conductor

I bet that the vast bulk of these properties are tax designated properties and that the reason so many of them are vacant is because of their locations (tax designated properties were the tool of choice in promoting rural development and repopulation- someone somewhere screwed up though.....).
I would be very surprised if any number of these properties are in locations where there is a ready rental market.

Sponge Bob

Wrong, lots of them are in non tax designated areas like D1 and Galway and Cork.

Its 1.25 years worth of total building output , a market overhang if ever I saw one.

The_Conductor

I'd never have guessed.
If that is the case then why are they not bothering to let the apartments/houses? Is the rental income not worth their bother? Are they afraid tenants will thrash the place and make it more difficult for them to hit the ground running if they decide to dump the property on the market?
1.25 years worth of housing stock is a serious overhang.

If I remember rightly there were proposals to tax income foregone as actual income. There might be a justification for it in those sort of circumstances?

FillSpectre

Still does anybody know where this guy got the figure?

Essentially one person has made the claim without any proof.

How it is even possible to gather this information accurately? It would require masses amount of research on a constant basis.

If it is true it really should be expressed as a percentage of all rental property.

It is spin and possibly a lie

whizzbang

FillSpectre wrote:

It is spin and possibly a lie

84.6% of statistics are made up on the spot after all.

Going with 104,000 is a good one, it is more than 100k which is big number in peoples's minds while maintaining a rough sounding accuracy by going with 104 rather than 105.

104,122 would have sounded a little too percise and people might have sought the soruce numbers.

Splendid statistic creation.

Gurgle

whizzbang wrote:

Could this be slanted by investors saying ther is nobody in there property to avoid tax?

^^
This Gringo could be on to something

miju

smccarrick wrote:

I bet that the vast bulk of these properties are tax designated properties and that the reason so many of them are vacant is because of their locations (tax designated properties were the tool of choice in promoting rural development and repopulation- someone somewhere screwed up though.....).
I would be very surprised if any number of these properties are in locations where there is a ready rental market.

they possibly are but i wouldn't be 100% sure , i live in Cityside (a development completed about 6 months ago) when I walk out my front door I see 5 vacant apartments and when I walk out the back I see another 3 vacant apartments and thats just in my immediate eyeline (by vacant i mean no furnishings in them or anything)

FillSpectre

miju wrote:

they possibly are but i wouldn't be 100% sure , i live in Cityside (a development completed about 6 months ago) when I walk out my front door I see 5 vacant apartments and when I walk out the back I see another 3 vacant apartments and thats just in my immediate eyeline (by vacant i mean no furnishings in them or anything)

I would think nothing of a 6 month vacancy on a newly completed devlopment. It doesn't mean they are investment and even if they are it doesn't mean they are losing money. Many people buy off plans to make a profit and some wait for phase 2 to be released to sell.

Still the figure has no backing and while the cliche about stats been made up can be true. We are simply talking about one man saying something without any support. The paper are slightly irresponsible for not asking for the figure to be supported.

miju

cityside has fully finished all building phases

agree would be very interested to see where that figure came from also

whizzbang

FillSpectre wrote:

Still does anybody know where this guy got the figure?

He is a profressor in TCD, I just emailed him to ask, I'll let you know what he says.

garred

If this figure is true might it have something to do with CGT........is it true that if you are thinking about selling an investment property you can move back into it for a year, claim it as your primary residence and avoid paying CGT?

whizzbang

garred wrote:

If this figure is true might it have something to do with CGT........is it true that if you are thinking about selling an investment property you can move back into it for a year, claim it as your primary residence and avoid paying CGT?

I think you avoid paying CGT on the year you spend living in it. Not the time it was rented. I don't think the Revenue would let you get away with that! Otherwise you would have property developers moving house every year!

whizzbang

This 104,000 figure comes form John Fitzgerald, "The Irish Housing Stock : Growth in Number of Vacant Dwellings" in Quarterly Economic Commentary, ESRI, Dublin, Spring 2005.

you can download it here (PDF)

miju

righto that raises some questions:

1: are they're more up to date figures (as they're from 2002) and how likely are they to be now occupied

2: a total of 67,000 can be accounted for as temp vacant / holiday homes which leaves an overhang of 37,000 homes smack bang in the middle of the recent boom (where's they'res a shortage) so someones been fibbing about supply to the tune of 37,000 extra homes (you could say the whole country was gazumped LOL )

3: most importantly, is the figure of 37,000 homes likely to have increased or decreased (i'm betting increased due to increasing building output year on year)

FillSpectre

After briefly looking at it all I can say is it seems to be quite little increase as a percentage of the overall market. In other words a normal attribute of our housing market.

The figure are 4 years old so to state the the current figures appears to be speculative.

The_Conductor

If you read the report- over a quarter of the properties in the 2002 stats listed as vacant were either incomplete or uninhabitable for undefined reasons. Almost a further third were holiday homes leaving less than half the vacant properties as principle residences or investment properties unoccuppied for one reason or another.

Also of interest- there have been more properties completed since 2002 than in the 10 previous years combined (84,000 in 2005 and on target for 86,000 this year).

The report, while an interesting read, is unfortunately entirely obsolete given developments of the last 3-4 years. It also hypothesises about information volunteered in the '02 census. It is unclear whether the basis for a lot of the hypothesis are sound. I suppose I shouldn't question the good professor.

Remember- prominent economists have predicted 11 out of the previous 6 recessions

whizzbang

miju wrote:

righto that raises some questions:

2: a total of 67,000 can be accounted for as temp vacant / holiday homes which leaves an overhang of 37,000 homes smack bang in the middle of the recent boom (where's they'res a shortage) so someones been fibbing about supply to the tune of 37,000 extra homes (you could say the whole country was gazumped LOL )

[edit]saw your retraction on AAM[/edit]

in 2002 there following was the breakdown of inabitable but empty houses
Temperarilty vacant: 26,736
Holiday home: 39,383
other: 104,035 <== the 104,000 quoted in the article

I'm not sure of more recent figures, I guess it will be a while for the 2006 cencus to be available.

I'm not sure if the number will have goen up or down though as there are more houses but also more immigrents.

FillSpectre

The total number of vacant property doesn't matter it is the figure as a percentage that tells the true story and allows comparison. As percentage has remain relarively stable it appears to be normal. There is no noticable increase i vacant houses. THe article suggested there was.That does not appear to be the case and the report is well out of date and relies of volountered information. In the absence of other data I guess it is an indicator but a very inaccurate one.

miju

according to today's Independant , initial signs from the census show there's now approx 270,000 vacant properties (which is a rough increase of 165% :eek: :eek: ) PLUS another 30,000 holiday homes and thats based on figures from April of this year

what's more is that figure has been arrived at has the enumerators had to enquire with developers , management companies, neighbours in order to make a property down as vacant

property shortage , me arse

The_Conductor

Cool!
Thats almost 4 years supply worth......
Along with interest rates on an ongoing upward trachetory......
Writing on wall anyone?

FillSpectre

miju wrote:

according to today's Independant , initial signs from the census show there's now approx 270,000 vacant properties (which is a rough increase of 165% :eek: :eek: ) PLUS another 30,000 holiday homes and thats based on figures from April of this year

what's more is that figure has been arrived at has the enumerators had to enquire with developers , management companies, neighbours in order to make a property down as vacant

property shortage , me arse

According to the indo nothing of the sort. That is nothing to do with the CSO figures and more to do with the collection of data. A very slanted piece. BAsically they didn't get answers from places and checking they were vacant. That does not mean they have an accurate count. There were huge blocks they couldn't get into also and there is no mention of that.

A friend of mine works in the CSO and they were in real trouble trying to get to people in gated communities of all sorts. This was well publicised on Joe Duffy when it was going on yet the indo ignore this part. The story should be about the census not housing

ronbyrne2005

Theres obviously not a huge housing shortage as rents havent risen much if any in real terms in 5/6 years,if there was huge demand for housing rents would rise as well as property prices.
property owners can offset losses on one property off profits from rents on another property,if people claim to be trying to rent their property but in reality are just sitting on them for capital appreciation they may be offsetting the loss (due to interest paid on interest only mortgage) against profits in other properties and reducing income tax but making loads of paper profits through the prices of all his/her properties rising.

whizzbang

smccarrick wrote:

Cool!
Thats almost 4 years supply worth......
Along with interest rates on an ongoing upward trachetory......
Writing on wall anyone?

I'm looking forward to the full Census result (man I can't believe I just wrote that) it will be interesting to see what the real demographics of Ireland are these days!

Sponge Bob

FillSpectre wrote:

A friend of mine works in the CSO and they were in real trouble trying to get to people in gated communities of all sorts.

The UK runs at a vacancy level of c 3% , and thats also taken from a census check .... in 2001.

In Ireland 300,000 out of 1.8m is c. 16.6% . Allow that 50000 were in 'blocks' where they could not get access. That still leaves 250,000 properties empty nationwide or 13.8% . Thats 4 x the UK. The UK also has high rates of empties in places like mining areas where there are no mines and blocks of the UK empties are up north where the housing demand is low, eg Liverpool where the population has dropped a lot in the past 50 years and which has the highest empty rate in the UK, 7.6% . London has a rate around 1-2% by contrast.

Even in areas of Wales, the mining valleys, that have high rates of empties and where there is no mining any more the rate of empties is about 6% at its worst .


Some of our empties are in rural areas where the population declined too.


Nevertheless we seem to have over 4 times the UK number of empties and with no obvious depopulation driver as in former industrial belts in the UK .

But feck it anyway, we Irish are different

miju

FillSpectre wrote:

According to the indo nothing of the sort. That is nothing to do with the CSO figures and more to do with the collection of data. A very slanted piece. BAsically they didn't get answers from places and checking they were vacant. That does not mean they have an accurate count. There were huge blocks they couldn't get into also and there is no mention of that.

irish independant wrote:

Enumerators delivering and collecting the census forms were unable to contact the inhabitants.

Following inquiries among neighbours, postmen and women and apartment block management companies, the vast majority of those dwellings - some 275,000 - were identified as being vacant.

......................

In a further 30,000 cases, there was nobody at home when census officials called on various occasions.

......................

These preliminary figures are based on population summaries prepared by enumerators

this isn't the gated properties that the CSO are talking about ( according to one of my ex-colleagues in CSO )

this preliminary figure was arrived at from the enumerators speaking to postmen , management companies , neighbours OR in otherwords people who would actually know a property is vacant and obviously to get to a neighbour they can get into the estates

FillSpectre

Sponge Bob wrote:

The UK runs at a vacancy level of c 3% , and thats also taken from a census.



But feck it anyway, we Irish are different

Actually we are, look at the report this thread is about as it shows 10% is our average.

miju wrote:

this isn't the gated properties that the CSO are talking about ( according to one of my ex-colleagues in CSO )

this preliminary figure was arrived at from the enumerators speaking to postmen , management companies , neighbours OR in otherwords people who would actually know a property is vacant and obviously to get to a neighbour they can get into the estates

I know that I am just pointing out the article is making a claim when there were massive problems collecting data this time. The figures aren't CSO figures but anicdotal evidence from the collectors. I am not going think it is reliable sources of information. I think it is very misleading

miju

i agree it is misleading as the number of vacant properties could possibly be even higher if the gated estates that the enumerators couldn't access were included

anecdotal evidence it may be , but i'd be willing to bet that when the census figures are released it won't be too far off that mark (possibly slightly lower / possibly slightly higher but wouldn't be more than about 10-20k either way IMHO )

whizzbang

miju wrote:

anecdotal evidence it may be , but i'd be willing to bet that when the census figures are released it won't be too far off that mark (possibly slightly lower / possibly slightly higher but wouldn't be more than about 10-20k either way IMHO )

yep, I agree, it would tally with the number of properties been built and the lack of increase in rents.

Sponge Bob

10k or 20k off which figure, the anecdotal 300k empty one or the 104k investor one ?? . One in 6 is mainly empty where I live (based on observation) and would have been in mid april for sure.

miju

off the anecdotal one

FillSpectre

What is it as an acutal percentage of the overall housing stock?

Not a single house empty near me. The only place I have heard of is in newly built (0-3 years) and it is no bigger than 20% vacant. So where are all these vacant properties?

They aren't within the m50. If we are going anecdotal where are the empty places? Is anybody saying that in Dublin we have even close to 10% vacant?

Sponge Bob

FillSpectre wrote:

What is it as an acutal percentage of the overall housing stock?

Overall is min 1.5 - or max 1.8 m of which 300,000 is 20% empty or 16.7% empty . In that range anyway.

What the Indo Said

http://www.unison.ie/irish_independent/stories.php3?ca=9&si=1636317&issue_id=14226

Following inquiries the vast majority of those dwellings - some 275,000 - were identified as being vacant.

In a further 30,000 cases, there was nobody at home when census officials called on various occasions.

Almost two months after the census forms were filled in, 1.5 million forms have been completed and collected, according to the Central Statistics Office (CSO).

The CSO sent out some 1.8 million forms to addresses around the country in April.

Some of the 300,000 do not exist, eg a house in Rathmines that was once 10 flats and is now converted to one house but with the old doorbell still there . We can probably state with certainty that 250k are empty and habitable . 25k are empty and grotty and the other 30k (persons in no contact) often have Romanians and Albanian and Serb residents who dont answer the door to officialdom

250k out of 1.8m is about 14% . Thats 14% empty and habitable

Victor

!

http://home.eircom.net/content/unison/national/8294126?view=Eircomnet

No-one there, so 300,000 homes not counted in census figures
From:The Irish Independent
Monday, 19th June, 2006

MORE than 300,000 homes across the country will not be included in the latest census - because there was no-one at home.

Enumerators delivering and collecting the census forms were unable to contact the inhabitants.

Following inquiries among neighbours, postmen and women and apartment block management companies, the vast majority of those dwellings - some 275,000 - were identified as being vacant.

In a further 30,000 cases, there was nobody at home when census officials called on various occasions.

Almost two months after the census forms were filled in, 1.5 million forms have been completed and collected, according to the Central Statistics Office (CSO).

But those who have not had their forms collected still have time to get them in and be counted.

The laborious processing operation is now underway, compiling data such as how many rooms there are in our houses, types of household, job descriptions and the distance of our journey to work.

The CSO sent out some 1.8 million forms to addresses around the country in April.

During this process, an army of more than 4,400 enumerators pounded the pavements the length and breadth of the state, delivering the forms to homes and then collecting them a month later.

Their task finally ended on May 22.

Householders whose forms have not been collected are asked to post the completed document to Central Statistics Office, PO Box 2006, Freepost 3985, Swords, Co Dublin.

The CSO will now spend the next six months processing the forms, and a spokesperson assured those who have yet to post in their form that it will still be included.

While the definitive population results will not be made known until next year, preliminary figures, setting out the number of males and females in each electoral division, will be published on July 19 next.

These preliminary figures are based on population summaries prepared by enumerators.

Breda Heffernan

FillSpectre

Sponge Bob wrote:

250k out of 1.8m is about 14% . Thats 14% empty and habitable

Where are these empty properties? 1.8 million was the number of forms sent out not the number of habitable buildings in Ireland.

We are talking over 1 in 10 being empty. IN my area of say 100 houses there isn't one that is empty. There should be 15 so to make the average work out that 15 has to be some where else. Where? Are there massive areas where there are empty places is it all outside Dublin?

Gurgle

Sponge Bob wrote:

We can probably state with certainty that 250k are empty and habitable.

Thats an absolutely shocking number & contrary to all common sence tbh.
Why leave a property vacant?

I don't get it.

FillSpectre

Gurgle wrote:

Thats an absolutely shocking number & contrary to all common sence tbh.
Why leave a property vacant?

I don't get it.

Think about it for a minute. Do you know where there are tons of vacant property? It appear to me at least to be contrary to anything I see.

It is a valid question to say why are they being left empty?

There certainly is investors sitting on property and there always has been. Just walk off Grafton Street into the shopping arcades that are empty. Rather than rent it out cheaply they aren't rented at all. This makes sense for big businesses but small investors and residential property don't normally suit this. THere could be a bunch of idiots but I think the numbers are unrealistic.

Sponge Bob

Gurgle wrote:

Thats an absolutely shocking number & contrary to all common sence tbh.
Why leave a property vacant?

Tax writeoffs. Rural Renewal and Seaside Resorts (who goes to Bundoran for Census weekend in April ) ? See page 54 of 68 of this PDF . In April the seaside resorts are empty...pretty much. Thats 5300 tax designated units dotted around the coast sucking tax .

There are old houses in rural Mayo or rural Carlow where nobody lives and nobody has modernised them.

There are areas where investors buy and do not bother renting out because of capital appreciation, Tuam in Galway is one such .

Add them up.

Fillspectre could also be right, the empties are not where HE is but do go to Bundoran in April sometime Fill !

miju

and to meakstown / lanesborough in dublin while yer at it.

on a side note , did anyone hear a report on Newstalk this morning that senior members of the ECB are aggressively seeking a .25% rise NEXT month plus another .25% in August and if no rises are made they'll be seeking to rise the base rate by .50% in August as they are struggling to control inflation

FillSpectre

Sponge Bob wrote:

Fillspectre could also be right, the empties are not where HE is but do go to Bundoran in April sometime Fill !

If you are including hoilday homes they are not considered vacant property. All the tax breaks are not for full time homes some are for hoilday homes.

Vacancies before completion is standard and in new developments also take time to bed down.

It is not a case where I am but how the figures would need to match up. If you are saying 16-20% of all housing is vacant it is a wild statemnt. As there isn't anything noticable in my area or any area I see regularly where is this percentage from these areas. Say I know roughly 500 houses and only 5% are vacant, 25 yet it is suggested it is 100 vacant properties. It would be very noticeable. Now the offset of the 75 vacant properties that should be near me has to be somewhere. So another area of 500 places needs to have 175 to make up the 20% country wide average suggested. Now that is a 35% vacancy rate. Now there isn't 5% vacancy in my area IMHO not even close.

Now Dublin is the highest density in this country so if 20% is the norm for vacancies it would be very noticable. AS it is not very noticable you would have to have massive areas vacant around the country.

Any area you name could you please estimate how vacant it is and how large?

I just want to discuss how accurate this estiamte is. People are suggesting 1 in 5 places is vacant don't you think this would be easily seeable ether in the heavily populated areas or in mass under populated areas.

miju

http://www.unison.ie/irish_independent/stories.php3?ca=9&si=1636569&issue_id=14227 is the article that seems to be what Newstalk were talking about this morning

re vacancy, as i said when earlier in a thread when i walk out my front door in citygate / cityside i see 4 vacant properties , out the back i see another four , i walk down to the bins i see another 2 , i drive up st margerats road i can see 7 more (this is in an estate thats been completed for approx 1 year now) , when i walk to the spar i can see another 9-10 , all these properties are blindingly empty due to no furniture / blinds / dust covering windows etc (these are all apartments by the way , not so sure how many houses are unoccupied as i dont frequest that part of the estate too much)

in lanesborough (an estate about 2-3 years old) when i call into a friend the 2 ground floor apartments next too him are empty (have been since he's lived there which is about a year) across the road there's 2 houses empty as well (for about 4-5 months or so)

that's all within a 3 minute walk of where i live , obviously when you talk averages some places with have much higher vacancies than other area's hence it being an average

FillSpectre

miju wrote:

that's all within a 3 minute walk of where i live , obviously when you talk averages some places with have much higher vacancies than other area's hence it being an average

if I tell you I see 100 empty houses it sounds like a lot. If I say it is out of 100000000000 it doesn't sound like much! I have no idea how many appartments are in the complexes you are saying. It might be 1% or 90% saying the amount you see as vacant means nothing without context. I trying to understand what you are saying but you are only giving part of the picture any chance of giving the total number of houses there? I see in my area and friends etc... in Dublin urban areas built from 40s-90s are below 3% vacancies.

New appartment complexs still take time to bed in and 1 year isn't particularly long or exceptional. There are investors involved for sure but lets get a gauge on it rather than take two pieces of sepearate anecdotal evidence and blend them into a fact.

City Gate/ City Side is s lightly ill concieved IMHO anyway. I didn't know it by the name but the location. Once you get out of it all the areas close by would be running lower than 5% vacancy if you ask me.

miju

re: citygate there's 75-80 ish apts and about 30-40 houses so all in all a 23.3% vacancy rate

re: lanesborough - have no idea how many houses but the vacancy rate would be low enough in lanesborough i'd reckon about 2-3% at most

by the way , i wasn't using my post as an example for high vacancy rates , i was merely using it has an example that vacancies exist in Dublin and that not all of the 270,000 vacancies would be outside the pale

FillSpectre

miju wrote:

by the way , i wasn't using my post as an example for high vacancy rates , i was merely using it has an example that vacancies exist in Dublin and that not all of the 270,000 vacancies would be outside the pale

I never denied vacancies existed just that for the 20% vacancy rate to be true around the country it would be very very noticeable. Dublin would have to have a massive vacancy rate is certain areas and parts of teh country would need to be abandoned. Overall in Dublin I can't see the rate being above 10% I would say the same applies to the other cities and large towns in Ireland. Given this as a logical assumption there would need to be massive areas of empty properties. The media would be all over this if it was true, they are more likely to blow up certain information to make a story. That's what I think of indos article and how I think it is not true reflection of vacant properties.

If you are being told something is true yet you can see it isn't why would you beleive it?

Gurgle

Sponge Bob wrote:

Tax writeoffs. Rural Renewal and Seaside Resorts (who goes to Bundoran for Census weekend in April ) ? See page 54 of 68 of this PDF . In April the seaside resorts are empty...pretty much. Thats 5300 tax designated units dotted around the coast sucking tax .

Ah, so (for example) every chalet in Mosney (pre its current use) would have been counted as an empty residence under this definition.

Sponge Bob

Gurgle wrote:

Ah, so (for example) every chalet in Mosney (pre its current use) would have been counted as an empty residence under this definition.

Mosney is one unit a la a hotel I would have thought.