Housing bubble starting to pop?

whizzbang

Pa ElGrande wrote:

How did Fiona Tyrell keep a straight face when putting this piece together?

You would have to ask how she sleeps at night, but the answer is probably "On a bed of money"

ircoha

whizzbang wrote:

You would have to ask how she sleeps at night, but the answer is probably "On a bed of money"

exactly, derived from incentives to write such sh1t:)

dochasach

Pa ElGrande wrote:

How did Fiona Tyrell keep a straight face when putting this piece together? Smart investors have fled this market long ago...

Nah, you should buy when property is rising like mad and you should buy when property is dropping like a stone. Buy, buy buy!

How many would classify Donald Trump as a 'smart investor', if so, you do realise he has sold out of this scheme!

Nah, Yvonna Trump is the property genius in that odd couple. Her Beirut Lebanon towers is clearly a better investment than anything in Florida. http://www.bloomberg.com/apps/news?pid=20601100&sid=a8.y6H4KSiiI&refer=germany

Irish Times Article- Florida slump good news wrote:

Meanwhile, a condo development on the waterfront near Disney in Orlando, Florida...

Disney... hmmm, yes Goofy would be proud of the idea of investing in FL right now. BTW: "on the waterfront" certainly doesn't mean on the sea, Orlando is a two hour drive inland and to create high ground for any housing development, it's necessary to make a drainage pond. (I think this is FL state law) There are a few gator-infested natural lakes and swamps surrounding Orlando, and a couple of nice spring-fed lakes, but chances are good that an Orlando condo "on the waterfront" is adjacent to a drainage pond. The 1920s florida land bust led the American expression "I've got some swampland in florida to sell you." shorthand for a scam equivalent to "selling ya the Brooklyn bridge."

Pa ElGrande

lol, very good dochasach.

Looks like there was an outage this afternoon and here is some anecdotal information to backup the inventory levels in that chart you linked to.

With the American property bubble now deflating in a steady whoosh, I was amused to return from holiday last week to find a flood of unwanted e-mails from mainly Florida property developers offering cut-rate deals for condos and villas all over the sunshine state. One that especially caught my eye was a buy-back guarantee for a new development in Port Charlotte on the Gulf Coast that promised a 150% return on the deposit from the developer when you sign the final papers. This represents, says the desperate promoter, Hot Properties Worldwide, a 10% discount on the selling price.

Oh, and the developer will throw in all the closing costs as well.

What, just 10%? What about throwing in a top of the range air-conditioning unit? Or professional landscaping and a year’s worth of taxes and insurance?

There are finished and unfinished Florida properties that are selling for 20% less than they were last month, if they are selling at all, plus sweeteners like those above.

As one of the “hottest” real estate markets in America for the past decade, it shouldn’t come as any surprise that, along with California and Nevada and the East Coast, it is now suffering the biggest chill-down. Big bubbles beget big busts and there are now homeowners (including a few Irish investors I know) who have had their houses up for sale in the Orlando area since last Christmas, but haven’t seen a single prospective buyer walk through the door since Easter.

Like Ireland, the American property industry — developers, construction companies, tradesman, lenders and estate agents — has accounted for about 40% of the growth in gross domestic product.

Seventeen interest rate increases, rising oil prices, static wage rates (since 2001) and the turning off of the credit tap finally is taking its toll on the numbers of houses being sold nationwide – down more than 11% from last year – and in the huge inventory of unsold nationwide properties. That said, there are bargains to be had in Florida for anybody willing to wait for prices to fall even lower and who can afford the escalating costs of getting there.

Just make sure to avoid desperate internet promoters and boiler-shop cold callers, of whom I don’t doubt Irish sunseekers will be hearing much much more of as the high-season Christmas holiday approaches.

Sunshine state suffers chill
http://www.timesonline.co.uk/newspaper/0,,2770-2339576,00.html

Someone posted this earlier as well (Sorry I've forgotten your name). We can watch the carnage unfold in the US, note how the market conditions are changing rapidly and what was once 'a soft landing' is now turning to a slump.

NEW YORK (MarketWatch) -- With the $10 trillion housing market weakening fast, in defiance of the assurances of most pundits just a year ago, investors are starting to question the confidence among banks about their ability to weather a housing downturn.
Just a few months ago, homebuilders, the National Association of Realtors and most Wall Street analysts were still predicting a soft-landing in housing, in the same reassuring way they used to say last year that housing would remain strong in 2006.
But after the freshest figures - which showed sales of new homes sales plunged 21.6% in July from the year earlier, inventories of unsold homes soared and prices fell - there is little debate that the housing market is stumbling much faster than most expected.

Housing casts shadow on prospects for banks
http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7B4A7839E2%2DAC2D%2D4BD0%2DB069%2D1513F703B9EB%7D&link=&keyword=nick%20godt

Cue another 'soft landing' report tomorrow from IIB, just as well the fundamentals underlying the property boom are strong, so its difficult to tell why the bank is spooked by the ministers pre-election posturing, if the headline is anything to go by......

Government warned against going into property market
http://www.breakingnews.ie/2006/09/03/story275068.html

No doubt FF realise there is a lot of anger under the surface due to the current housing situation, with young families having to endure long commute times to work/school/shops/creche on top of a large mortgage (post 2001) and houses are still more expensive to buy. As long as house prices keep going up, those on the ladder will bite their tongue's, when prices start in the future to head into negative equity territory there will be a massive backlash.

The government’s take from new-home sales is about 40% of the price charged to “hard-pressed” buyers who, having already been soaked financially, are now in danger of being drowned by Ahern’s crocodile tears.

Thanks to our willingness to get deeper into debt to acquire a des res, the amount of stamp duty pouring into the exchequer’s coffers on a monthly basis has reached embarrassing levels. Property is also driving Vat receipts, accounting for 25% of this tax last year

Comment: Frank Fitzgibbon: Pull the other one, Noel
http://www.timesonline.co.uk/newspaper/0,,176-2340608,00.html

One solid fundamental underlying house price inflation is our ability to take on more debt.

HOUSEHOLD debt will rise to 160pc of household income by next year making it "the most critical issue" facing the economy and consumers.

With the debt-to-income ratio three times higher than it was 10 years ago, consumers are now very vulnerable to interest rate hikes, said Dermot O'Leary of Goodbody Stockbrokers. That means even a 1pc rise will hit them as hard as a 3pc leap would have in the past, he said yesterday at a Barnardo's seminar in Dublin.

People's spending power will soon be hit by the higher interest repayments they have to make to service their loans, said Mr O'Leary.

The burden of repaying our debt will double in the next couple of years from 5pc to 10pc of disposable income, he said.

Some 80pc of borrowings are for mortgages, with the remainder a mix of credit cards, car loans and other types of personal debt.

The debt frenzy means that Irish people have gone from being the most reluctant borrowers in Europe to the top of the table. Mr O'Leary described this as a "most extraordinary jump" and said it meant that for every €60,000 earned we owe about €100,000.

"It is the most critical element facing the economy and economic development in Ireland over the next couple of years," he added. Banks will have to cut back on mortgage lending in order to make sure people are not exceeding prudent guidelines on the share of income they spend on their mortgage, Mr O'Leary said.

Households debt rising to 160pc of average incomes
http://www.unison.ie/irish_independent/stories.php3?ca=9&si=1681602&issue_id=14598 [free registration required]

D'Peoples Voice

What are people reading into the Daft rental Index
http://www.daft.ie/report/rental_index.daft
December '05 104.4 (ECB increase of 0.25%)
January '06 103.3
February '06 102.6
March '06 102.8 (ECB increase of 0.25%)
April '06 102.9
May '06 105.0
June '06 105.8 (ECB increase of 0.25%)
July '06 105.8

Note the above compare with an index reading of 115.6 in January '02!

Are we seen the recent jump due to higher interest rates(higher mortage repayments forcing investors hands) or due to demand exceeding supply?

chump

I recently starting renting a place in Dublin CC, and believe me the rental market has turned. I had been looking at places over the last 6 months (out of interest) and price has inceased quite sharply.

I took these figures for 2beds apartments available on daft for 1200euro or less
@ start june, 24 were available, then
22
18
23
27
35
mid july, 32
The in between figures were days in between those 2 dates where I took the figures.

Today for 1200euro or less in Dublin City Centre there is 12.

I ended up getting a 1-bed, with much trouble, and along the way heard how the landlords couldn't believe the demand, and saw places being snapped up within hours...

bico

chump wrote:

I recently starting renting a place in Dublin CC, and believe me the rental market has turned. I had been looking at places over the last 6 months (out of interest) and price has inceased quite sharply.

I took these figures for 2beds apartments available on daft for 1200euro or less
@ start june, 24 were available, then
22
18
23
27
35
mid july, 32
The in between figures were days in between those 2 dates where I took the figures.

Today for 1200euro or less in Dublin City Centre there is 12.

I ended up getting a 1-bed, with much trouble, and along the way heard how the landlords couldn't believe the demand, and saw places being snapped up within hours...

August is usually the month when the students return , so there is a sudden demand for rental properties.
Combined with first timers being priced out of the property market and renting where it's convenient as opposed to where they can afford to buy and you'll have rising rents in central locations.

Supercell

Exactly, no mystery there at all, as to landlords being suprised, yeah..you honestly believe that?
Lets see the rents next January (well into the school year) and see how many landlords believe the demand!!

Pa ElGrande

• Badly judged government intervention is the key risk for the Irish housing market in 2007.
• The recent acceleration in Irish house prices reflects strong demand and improved accessibility not speculation.
• Improved accessibility has more than offset any squeeze on affordability but this will change.
• Half of Irish consumers see higher energy costs as the major risk to the Irish economic outlook, 1 in 4 regard rising interest rates as the key threat, with 1 in 8 citing inflation worries. So, spending power is under pressure for many Irish consumers.
• We think appropriate budget policy would boost the economy and property market in 2007.
• The Irish government finances are in very strong position. So, Mr. Cowen can afford to be generous.
• Strong demand is sustaining house price growth. PPS applications from accession states are up 28% in 2006. SSIAs are also boosting the market.
• Irish consumers are still confident about property values, with 9 out of 10 expecting prices to rise further in 2007.
• We reckon Irish house prices will rise 13 per cent in 2006 and 7 per cent in 2007.

Irish Housing Market Outlook 2006/2007: How Great Are the Risks?
http://www.iib.ie/economic/briefings/Irish%20Housing%20Market%20Outlook%2004.09.06.pdf

The only risk outlined in this report is what the government might do next, its all upside spin, its an appeal to Mr. Cowen to keep the party going. It's about time, the government started acting in the long term interests of the country, the South Korean government is attempting to bring the problem under control, even the Chinese recognise the threat to their economy caused by property speculation and have taken steps to stamp it out. Just ask any of the Irish who lost money in Shanghai property.

Housing Loan Maturities Get Longer
Households Tap Longer-Term Mortgages to Bypass Tight Loan Regulations
http://times.hankooki.com/lpage/biz/200609/kt2006090418143011900.htm

Expanding long term debt is not in our national interest and neither is an insolvent banking sector, there can't be a 'soft landing' because they don't control the market, there can only be a correction. One of the items he perceives is "We feel that speculative pressures have not materially altered the recent trend in Irish house prices."
How can this be with around 275,000 vacant properties around the country? (source: Irish Independent)
When investors account for 30% of the market? (source: Hooke & McDonald)

shoegirl

chump wrote:

I recently starting renting a place in Dublin CC, and believe me the rental market has turned. I had been looking at places over the last 6 months (out of interest) and price has inceased quite sharply.

I took these figures for 2beds apartments available on daft for 1200euro or less
@ start june, 24 were available, then
22
18
23
27
35
mid july, 32
The in between figures were days in between those 2 dates where I took the figures.

Today for 1200euro or less in Dublin City Centre there is 12.

I ended up getting a 1-bed, with much trouble, and along the way heard how the landlords couldn't believe the demand, and saw places being snapped up within hours...

Actually this is normal - its always dead quiet in June-July and then demand picks up August -Sept as students return. It quietens down again in November usually. Actually I'm noticing much more cheaper properties on the market. Though to be fair, the demand for 1-beds is very high and has ALWAYS been a high pressure rental area.

What I am noticing though, is a surprising number of cheaper properties still available for this time of year - normally there is very little available this time of year.

shoegirl

Pa ElGrande wrote:

The only risk outlined in this report is what the government might do next, its all upside spin, its an appeal to Mr. Cowen to keep the party going. It's about time, the government started acting in the long term interests of the country, the South Korean government is attempting to bring the problem under control, even the Chinese recognise the threat to their economy caused by property speculation and have taken steps to stamp it out. Just ask any of the Irish who lost money in Shanghai property.

Housing Loan Maturities Get Longer
Households Tap Longer-Term Mortgages to Bypass Tight Loan Regulations
http://times.hankooki.com/lpage/biz/200609/kt2006090418143011900.htm

Expanding long term debt is not in our national interest and neither is an insolvent banking sector, there can't be a 'soft landing' because they don't control the market, there can only be a correction. One of the items he perceives is "We feel that speculative pressures have not materially altered the recent trend in Irish house prices."
How can this be with around 275,000 vacant properties around the country? (source: Irish Independent)
When investors account for 30% of the market? (source: Hooke & McDonald)

To be honest IIB are quite a biased commentator. Any pressure on investors would hit mortgage brokers and sellers hard as the first time buyer market is going to be put under pressure by rising interest rates. What in any case, I think the government are trying to target is people who buy off the plans and then sell immediately at a profit without ever even taking the keys to a place. This adds no value to the process, and is not benefitting the market in any way.

For example I lived for 2 years in Midleton, and a development was built opposite us where a few 4 bedroomed terraces sold for about 450k each. Only one of the was occupied a few months after the completion, but there were "for sale" signs up on the other 5 or 6 - every one of them had been bought by speculative investors (though I find it hard to see how much gain you could have made on property that was already probably overvalued for the area). These speculators added nothing to the property, it would not be a bad idea to heavily tax gains made on selling a property that was never occupied because the owner never lived in it and never tried to rent it out at a realistic rent.

Incidentally I lived in a 3 bed mews accross the road from this development, where houses valued at 320k+ were renting for 750 a month. If you bought one of these, even borrowing only 80%, your mortgage would be 1378.26. In the unlikely even of you having no other income, this would leave a shortfall of nearly 630 a month on the rent, for a 42% tax payer, this would rise to a shortfall of 940 a month - thats a lot of money to be short, you'd need to have good profits on a few other properties to make up the difference. Its certainly not a rental investors market at the moment, so many investors are turning to speculation to make up the profits in this way.

chump

Longfield wrote:

Exactly, no mystery there at all, as to landlords being suprised, yeah..you honestly believe that?
Lets see the rents next January (well into the school year) and see how many landlords believe the demand!!

First off I was replying to D'Peoples Voice post with my personal experience backing up what he was saying, so no need to jump down my throat.


Secondly
Why should I doubt that the landlords were surprised?
Two examples. 1 property released on daft at midnight. Next morning ring. SUre thing - showing between 5&6.30. Go look at 5.30. Sorry, just gone. Said had non-stop calls since the morning. Was surprised.
Property ended up getting - skipped the queue 'cos of bad experiences (persuaded him to let see first). Took it - he rang and cancelled 10/11 other viewers. Surprising.
I'm not saying the demand isn't driven by students, but these places weren't for students. All I'm saying is prices have increased, and whether seasonal or not, time will tell!

D'Peoples Voice

Pa ElGrande wrote:

The only risk outlined in this report is what the government might do next, its all upside spin, its an appeal to Mr. Cowen to keep the party going. It's about time, the government started acting in the long term interests of the country, the South Korean government is attempting to bring the problem under control, even the Chinese recognise the threat to their economy caused by property speculation and have taken steps to stamp it out. Just ask any of the Irish who lost money in Shanghai property.

Strong demand is sustaining house price growth. PPS applications from accession states are up 28% in 2006.

Interesting to hear this, because a Sinn Fein councillor was on the raidio at the weekend discussing South Dublin county council councillors getting tickets to the Ryder cup from property developers, anyway, when asked about the number one complaint Sinn Fein receive from voters at the door, it's immigration. He believed it would be the number one issue at the election.
Not health, not crime, not house prices but immigration. Our property market is greatly dependent on these people, it'll be interesting to hear the various parties debate this!

Pa ElGrande

McKenzie, the university researcher, is carrying a 100 percent, 35-year mortgage on his 210,000-euro apartment in the commuter town of Ashbourne, County Meath. He estimates that ECB rate rises will boost his monthly bill above the 940 euros he pays today. When he bought the two-bedroom apartment in December, the payment on his mortgage was 810 euros.

As his disposable income shrinks, McKenzie is getting used to more nights at home in front of the television.

``Now each week I go to the cash machine and take a set amount and try and live on that,'' McKenzie says. ``I've already cut down on meals out. It's the price you have to pay to buy a house in Ireland these days.'

more >>>>

Irish Mania for Homeownership Squeezes Consumers as Rates Rise
By Dara Doyle
http://www.bloomberg.com/apps/news?pid=20601109&sid=aYcvATm_m374&refer=home

More signs of people being stretched are coming to the surface.

bico

"But a staggering 62pc of homes in Ireland are owned outright with no mortgage attached, he added"

http://www.unison.ie/irish_independent/stories.php3?ca=9&si=1681602&issue_id=14598

Maybe this helps to explain the 270 000 vacant homes.
Looks like at least 62% of the houses will not be put on the market when prices fall due to the rise in interest rates .

whizzbang

D'Peoples Voice wrote:

when asked about the number one complaint Sinn Fein receive from voters at the door, it's immigration. He believed it would be the number one issue at the election.

oh great, that's just what we need, its not like any Irish went abroad to make a better life for themselves... also, aren't the estate agents telling us its all the Foreign nationals who will save the property market and keep these people from being crushed with negative equity?!?

The day a mainstream Irish politician takes an anti immigration stand will be a sad sad day for this country.

Dilly1

All I know is... what goes up must come down.

Even a 5 year old kid knows that everything is overpriced at the moment.
I lived in London in the late 80's early 90's, property was way overpriced
then too. People still paid the money though, they also kept saying everything
was just great and nothing could go wrong. Then everything went pair shaped
and some people actually walked away from their houses leaving the keys in the door, because it was cheaper than keeping up re-payments.

Same thing could just as easily happen here, we are not special.


on a good note though, I know plenty of people (brother included) who didnt have property, but made a killing by buying after the slump in exclusive places like Fulham. There is always a silver lining

D4 here i come !!!

Sizzler

People,

For those of you who believe the bubble is poptastic can you please state:

In your opinion (no BS back up data please!)

A) When did the bubble start?
When did you genuinely believe there was a bubble?
C) When did you start to believe it will burst? (Honestly!)
D) When is it going to 'pop'?
E) Provide a definition of your understanding of the word 'pop' please..

Let the games begin

Pa ElGrande

A) When did the bubble start?
2001 when interest rates were lowered and the cost of renting started to be less than the mortage.
When did you genuinely believe there was a bubble?
December 2005
C) When did you start to believe it will burst? (Honestly!)
December 2005
D) When is it going to 'pop'?
It may already have begun this summer 2006, if not by the year end 2007.
E) Provide a definition of your understanding of the word 'pop' please..
Average selling prices decrease and inventory builds as sellers are reluctant to sell for less than its worth.

Please note the above is my opinion in Sept. 2006, if data becomes available I will revise my opinion, do not base your decisions to sell or buy property solely on mine or anyone else's opinion. You must conduct your own research into the Irish property market if you are considering buying or selling.

Shane™

A) When did the bubble start?
The seed was planted with the Celtic tiger

When did you genuinely believe there was a bubble?
March 06, outbid third time in a row by investors, looked like a pyramid scheme TBO

C) When did you start to believe it will burst? (Honestly!)
After the first SSIA's came out, went form a trong to just me, outbid by 30k to me offering the asking price with only the auctioneer bidding against me (property still on market)

D) When is it going to 'pop'?
After the SSIA's have drained from the market (August 07)

E) Provide a definition of your understanding of the word 'pop' please..
Lots of heartache for lots of people, basically a lapse in confidence followed by about a year of uncertainty, then outbidding in the opposite direction.

Edit:added nice blue colour like Pa

Pa ElGrande

D'Peoples Voice wrote:

Interesting to hear this, because a Sinn Fein councillor was on the raidio at the weekend discussing South Dublin county council councillors getting tickets to the Ryder cup from property developers, anyway, when asked about the number one complaint Sinn Fein receive from voters at the door, it's immigration. He believed it would be the number one issue at the election.
Not health, not crime, not house prices but immigration. Our property market is greatly dependent on these people, it'll be interesting to hear the various parties debate this!

There is definately a rise in support for Sinn Féin among the consituency who feel left out by the boom and the consensus politics of Labour, FF & FG & PD's. Immigrants are perceived by them as a direct threat to jobs and earnings growth. From job interviews I have conducted recently, the quality of most workers from Germany, France, South Africa, Poland, Russia and so on are streets ahead of most Irish people I interview, the motivation is there and so are the qualifications. We've got to raise our game to compete.
Over the previous two centuries we have depended on emmigration to solve our economic problems, put in this historical context in makes for an interesting debate (in another thread of course). For now, without immigrants in my neighbourhood the area would go downhill, as would the landlords income.

having heard things like 275,000 vacant homes in ireland and other quotes like "1 in 5 houses in ireland are holiday homes" I want to know where people got these statistics ARE THEY TRUE? If so how come there hasnt been another civil war! because people HAVE DIED for less

Pa ElGrande

Deleted User wrote:

having heard things like 275,000 vacant homes in ireland and other quotes like "1 in 5 houses in ireland are holiday homes" I want to know where people got these statistics ARE THEY TRUE? If so how come there hasnt been another civil war! because people HAVE DIED for less

There is no civil war because prices are going up, those already on the 'ladder' are ok with this since they feel they 'own' an appreciating asset. Some of those who own the empty properties are possibly looking at this as a nice pension nestegg. Also anyone who wants to, can find accomodation. The data from the census is questioned as some factors are not known like how many of these are for sale?, or were the census enumerators simply unable to communicate with the residents because of language barrier?

Approximately 275,000 residences were vacant at the time of the census while in the remaining cases the household was either enumerated elsewhere or temporarily absent from the State.

Census 2006 Preliminary report
http://www.cso.ie/census/documents/2006PreliminaryReport.pdf

House Completions and Housing Stock

• Over 86,000 dwelling units were completed in Ireland in 2005. This compares to less than 20,000 completed in 1990 and 50,000 in 2000.
• New dwellings were completed at a rate of 21 units per 1,000 of population in 2005; and added over 5% to existing housing stock.
• Close to half of the units completed in Ireland in 2004, the latest year for which data is available, were semi-detached houses. This compares to about 30% in 2000.
• In the April 2006 Census of Population, the CSO identified a total of 1.8 million private residences and communal establishments throughout the State. Of these, about 275,000 were vacant at the time of the Census
  
  Construction and Housing in Ireland
  http://www.cso.ie/releasespublications/documents/construction/current/constructhousing.pdf
  
  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.
  
  No-one there, so 300,000 homes not counted in census figures
  http://www.unison.ie/irish_independent/stories.php3?ca=9&si=1636317&issue_id=14226 [free registration required]

2005 data: One eighth of workforce employed in construction

• In the second quarter of 2005, there were 242,000 people employed in the construction industry. Approximately 1 in 8 people (12.6%) employed in Ireland work in construction. This compares with an EU average of less than 8%.
• Of the 258,000 net increase in total persons at work between 2000 and 2005, over 76,000 (or 30%) were in the construction sector.
• It is estimated that there were over 25,000 non-Irish nationals working in the construction sector in the fourth quarter of 2005. They represented about 10% of the total number employed in construction. About 15,000 construction workers are from the former Accession States.

Construction and Housing in Ireland summary
http://www.cso.ie/newsevents/pr_contstructhouse.htm

Construction and Housing in Ireland Report: CSO says Construction Output up 80% in 5 years - Mortgage debt increased from €33bn in 2000 to €100bn in 2005
http://www.finfacts.com/irelandbusinessnews/publish/article_10006756.shtml

Ireland's Celtic Tiger 2005: Built to last or on a foundation of quicksand?
http://www.finfacts.com/irelandbusinessnews/publish/article_10004162.shtml

Irish Economy 2006 and Future of the Celtic Tiger: Putting a brass knocker on a barn door!
http://www.finfacts.com/irelandbusinessnews/publish/article_10006912.shtm

whizzbang

ok ok, my secret shame

A) When did the bubble start?
2001 is when it got unsustainable
When did you genuinely believe there was a bubble?
2003
C) When did you start to believe it will burst? (Honestly!)
Until recently I never had a feeling the burst was imminent, only unavoidable. how I think we are going to see it burst within 18 months (and that is the long guess to save my blushes should nothing happen soon )
D) When is it going to 'pop'?
Peak has passed or is currently passing, stagnation will follow for a few quarters as investors stare in disbelief at their non selling houses, widespread and publicly noted prices declines in Q1 or Q2 2007

E) Provide a definition of your understanding of the word 'pop' please..
I'm expecting a stagnation period of a few quarters, then a steady decline at the same rate prices went up. So 10% to 15% a year for maybe 5 years. With a dead cat bounce somewhere in there as well. There will be stores of "House drops 40% in 12 months" as well, but these will be the exception, probably houses over 1 or 2 million euro which were stupidly overvalued at the peak.

Sponge Bob

Sizzler wrote:

A) When did the bubble start?

arguably 1999/2000 but there was a soft landing in 2001 . The real bubble started about 2003 .

When did you genuinely believe there was a bubble?

2003

C) When did you start to believe it will burst? (Honestly!)

in 2003 , every bubble bursts you see. I could see their eyes glaze over as they rabbited on about how property never falls in price etc. They had forgotten that it HAD in 2001 .

D) When is it going to 'pop'?

Its popping as we write, the amount of inventory in the sales channel has risen dramatically all summer. There are too many estate agents around to manage a clean pricing cartel anymore , unlike in 2001 .

E) Provide a definition of your understanding of the word 'pop' please..

I hear more of a long loud hiss than a pop if you don't mind. At the bottom of this hissing cycle some extreme commute areas like Cavan or Monaghan or Wexford or Longford will fall as much as 50% , this will take maybe 3 years from now.

Good areas like Rathgar will not fall by that much, I will wager 25-30%

I will never see another mania like this past few years in Ireland in my lifetime .

whizzbang

Sponge Bob wrote:

I will never see another mania like this past few years in Ireland in my lifetime .

Do you not think we will have another one in 15-20 years time with the recent surge in babies? Or will we be all "once bitten twice shy" about property?

bounty

so, its gong to pop in 2007?

anyway, how can i encourage this poppage? ... phone the gerry line? don't buy a house? wander town with a mega fone, preaching poppage like a crazy zealot?

im planning the opposite of a mortgage now, ive saved such a big deposit, i am going to use the interest to pay my rent

whizzbang

bounty wrote:

anyway, how can i encourage this poppage?

tell everyone you know about the big numbers of empty houses around, and also mention how estate agents are telling their friends to sell. We all love to hear "insider information"

Shane™

whizzbang wrote:

tell everyone you know about the big numbers of empty houses around, and also mention how estate agents are telling their friends to sell. We all love to hear "insider information"

I think you're trolling now

D'Peoples Voice

Pa ElGrande wrote:

There is definately a rise in support for Sinn Féin among the consituency who feel left out by the boom and the consensus politics of Labour, FF & FG & PD's. Immigrants are perceived by them as a direct threat to jobs and earnings growth.

Pa ElGrande,
It's gets better, this morning I was listening to the raidio and there was another debate about immgrants. This time it was about the hundreds of thousands of immigrants it is thought will descend on Ireland from Bulgaria and Romania when they join the EU!
People were saying this would cause the price of houses to soar, cause wages to stagnate, unemployment of Irish nationals to rise etc. The irony of that statement was not lost on me I can tell you!
Some caller made the point that come election time, we will have some political parties representing the middle class "new landlords since the property boom" who will be shouting for open door policies to immgrants, in order to push up rents, they will call any opposers to this idea, racists. Then we will have the political parties representing the existing tenants who may also happen to be low skilled workers most at risk to open door policies shouting for a closed door and calling any opposers non-nationalists.
Yes folks the bulgaria/romania debate will take centre stage next june.