Housing bubble starting to pop?

Afuera

gerrydublin wrote:

From the estate agent's point of view

Commission is higher on 245K than 239K

True... but not by very much.

A typical EA fee might be about 1% of the selling price which would mean there's only 60 euro difference for them between selling it for 245k and 239k.

Sponge Bob

The Building Industry delivered a thumping endorsement to the housing market which was reported today.

Planning Permissions in Q4 06 were 20% down on Q4 05 and of course planning permissions are not weather dependent like the separately reported starts figures ( due soon) ....which would have been affected by the mad storm season .

If the planning permissions dropped 20% and if the 06 figures were 90k units built in 06 that indicates a fall to 72k new units this year and not the 80k plus predicted.

stats

http://www.cso.ie/releasespublications/documents/construction/current/planperm.pdf

commencement stats will appear here

http://www.environ.ie/DOEI/DOEIPub.nsf/wvNavView/RegularPublications?OpenDocument&Lang=en#I2

due in April but given the odd delay on the sept 06 stats it may be out just after the election , strange that eh

Not a good time to hold certain shares methinks.

randomname2005

House prices have fallen in the 1st quarter of the year, and faster in dublin than elsewhere in the country:

http://www.rte.ie/business/2007/0402/houses.html

Sponge Bob wrote:

Not a good time to hold certain shares methinks.

http://www.breakingnews.ie/business/?jp=MHAUEYQLOJMH

R

mossym

randomname2005 wrote:

House prices have fallen in the 1st quarter of the year, and faster in dublin than elsewhere in the country:

from your article

The figures show prices rose by 0.2% in the quarter when Dublin was excluded.

not making any points, just getting the facts straight..housing prices only fell in dublin..they rose everywhere else...not by much though

randomname2005

mossym wrote:

from your article

The figures show prices rose by 0.2% in the quarter when Dublin was excluded.

not making any points, just getting the facts straight..housing prices only fell in dublin..they rose everywhere else...not by much though

In real terms that is a fall!

Ok, so I will change what I said (I don't want mossy getting annoyed at me ):

Sherry FitzGerald, Ireland's largest estate agents announced today that the average price of a second-hand property in Ireland eased back moderately by 1.1% during the first three months of 2007.

mossym

randomname2005 wrote:

In real terms that is a fall!

Ok, so I will change what I said (I don't want mossy getting annoyed at me ):

Sherry FitzGerald, Ireland's largest estate agents announced today that the average price of a second-hand property in Ireland eased back moderately by 1.1% during the first three months of 2007.

me? annoyed? never..:D

just keeping things on the straight and narrow..

soma

randomname2005 wrote:

Sherry FitzGerald, Ireland's largest estate agents announced today that the average price of a second-hand property in Ireland eased back moderately by 1.1% during the first three months of 2007.

In fairness though, they do use an odd definitely-not-scientific methodology involving a 'basket' of properties to generate their figures. Still it's interesting to see them report a fall, and even more hilarious to hear them use the phrase "eased back" rather than 'fall' :-)

whizzbang

soma wrote:

In fairness though, they do use an odd definitely-not-scientific methodology involving a 'basket' of properties to generate their figures. Still it's interesting to see them report a fall, and even more hilarious to hear them use the phrase "eased back" rather than 'fall' :-)

on other news, there is a Sherry Fitz sponsored re-issue of a popular 1990s movie coming out soon...



*edit* yay 1000 posts!

D'Peoples Voice

whizzbang wrote:

on other news, there is a Sherry Fitz sponsored re-issue of a popular 1990s movie coming out soon...

Excellent picture:D .

So Sherry Fitz are only seeing an easing,
others seem to be faring worse!

Gunne Acutioneers are apparantly letting off staff if Newstalk this morning are to be believed

CBRE claims that buying activity in Ireland has essentially halved in recent months due to 'unfounded negative commentary in the media' and recent political interference.

http://www.businessworld.ie/livenews.htm?a=1696074;s=rollingnews.htm

Ulster Bank report published in April, says the residential house building sector recorded its sharpest decline in March, for five years.

http://www.finfacts.com/irelandbusinessnews/publish/article_10009764.shtml

the central bank are seeing a reduction in mortgage growth every month since last July

It's difficult to know who to believe!
It will be good to see how the 'time to sell' statistic is faring on the next DAFT report, that will tell us a lot. If inventories continue to build up, prices can only go one way unless construction rates fall back substantially!

D'Peoples Voice

D'Peoples Voice wrote:

If inventories continue to build up, prices can only go one way unless construction rates fall back substantially!

That would relate to job losses - its a catch 22, there is nothing to do to stop a crash maybe a chance of a small dead cat bounce but thats all.

The country is in serious trouble and at an election time not many politicians seem to be grasping this

Sponge Bob

I feel I rrrrrrrrrrrreally must post this national empty homes figure from last years census again

The big problem is that we have far too many empty properties which have appreciated in price despite 'doing nothing' .




Now they must be liquidated. They are no longer going up in price.

Gurgle

Sponge Bob wrote:

I feel I rrrrrrrrrrrreally must post this national empty homes figure from last years census again

The big problem is that we have far too many empty properties which have appreciated in price despite 'doing nothing' .




Now they must be liquidated. They are no longer going up in price.

If I see that graph one more time, I'll have no option but to print it out in full 3D, take the longest spike off it and....

Actually one thing about the graph is the number of empties in 1971 would consist of houses left behind from the people emigrating when we had a declining population. Now we have no excuse with an increasing population and waaaaay more empties! Theses empties arent abandoned old farmhouses in the countryside either.

miju

Gurgle wrote:

If I see that graph one more time, I'll have no option but to print it out in full 3D, take the longest spike off it and....

why whats wrong with that graph it is correct afterall

antoinolachtnai

Well, some of them are holiday homes, no?

What do you propose to deal with this? A property tax?

antoin.

Sponge Bob

antoinolachtnai wrote:

Well, some of them are holiday homes, no?

Irrespective of what they are , the graph shows that there has been an UNNATURAL increase in the number of empty properties and ONLY in the last 5 years.

Furthermore these are not abandoned cottages and farmhouses as they were in the 1960s and 1970s .

Were we trending towards our average we would have about 11% of the housing stock empty today . These would be substandard/unmodernised homes and holiday homes . Yet we have about 16% or more empty.

It is safe to say that we will bring this 5% differential back into use but as 5% of our housing stock=90000=last years building it will take a full year of building nothing at all to so do.

Reyman

Deleted User wrote:

Actually one thing about the graph is the number of empties in 1971 would consist of houses left behind from the people emigrating when we had a declining population. Now we have no excuse with an increasing population and waaaaay more empties! Theses empties arent abandoned old farmhouses in the countryside either.

The population was rising in 1971. There was a significant increase in the number of people entering the country throughout the 1970s

Sponge Bob

Reyman wrote:

The population was rising in 1971. There was a significant increase in the number of people entering the country throughout the 1970s

The population was indeed increasing in the 1960s and 1970s

The LOWEST number of vacant properties EVER recorded in Ireland was about 8% during the immigration boom of the late 1970s .

Despite a greater immigration levels in absolute numbers during the past few years we have now reached twice that level of vacant properties, some 16% nowadays .

No other developed country bar Spain has anything like this level of empty property. In the UK its 3-4% , a quarter of what we have.

Deleted User

Deleted User wrote:

Actually one thing about the graph is the number of empties in 1971 would consist of houses left behind from the people emigrating when we had a declining population. Now we have no excuse with an increasing population and waaaaay more empties! Theses empties arent abandoned old farmhouses in the countryside either.

I didnt say that in 1971 we had a declining population I said in 1971 we had houses left over from when we had a declining population

It can be interpreted both ways but thats what I meant

D'Peoples Voice

Help Needed
I've been going over and over Enda Kenny's stamp duty proposals and I'm lost.
He says he wants to remove stamp duty for FIRST TIME BUYERS to make it easier for firs ttime buyers to buy a house up to 450K.
Before i start, I refer you to the ESRI/PTSB hosue price report (pub April 2007)
http://www.esri.ie/irish_economy/permanent_tsbesri_house_p/Feb_07_HPI_release_published_Mar_07_(2).pdf

The average price paid by a first-time buyer and a second-time buyer in February 2007 was EUR 279,399 and EUR 348,709 respectively.

So currently, the stamp duty threshold for first time buyers is EUR 317,500, abd the average price paid is EUR 279,399, so where is the problem?
Every additional interest rate rise, makes it more difficult for a first time buyer to get a mortgage and hence they move further away from 450K for a house.
Therefore given that house prices are stable at present ,why change things???? Why is this a good policy from Fine Gael, the party who came up with the fantastic idea of using my tax payers money to compensate the people who had enough money to throw away on Eircom shares! Bring back Alan Dukes PLEASE!!!!!!!!!!!
By the way I hope everyone is noticing the promises by the Opposition parties for the re-introduction of the first time buyers grant, yes remember how they jumped up and down when it was removed, check out their literature, no where do they say to reintroduce it!

miju

to put it simply , the whole stamp duty issue is a complete and utter red herring (as you so very well pointed out) and is the last way of estate agents etc "reasoning" for the current falls

stamp duty doesnt effect FTBs that much at all so there is no problem , the problem is simply the price of the property but that will be rectified soon enough

Do-more

Sponge Bob wrote:

It is safe to say that we will bring this 5% differential back into use but as 5% of our housing stock=90000=last years building it will take a full year of building nothing at all to so do.

The problem with that, is that a huge number of the empties (and houses which are still under construction) are in areas where people just don't want to live.

One village that I pass through from time to time is Keenagh in Co. Longford and I am always staggered by the amount of big detached houses being built in a number of estates in the village. I really can't see any demand for the majority of them. There is one social housing estate in the centre of the village which I assume will be fully occupied but other than that unless the Council buys them I really can't see many more of them being sold, even if (for example) they are just €285,000 for a 2210 sq. ft. 4 Bed. more on daft!

Sponge Bob

Do-more wrote:

The problem with that, is that a huge number of the empties (and houses which are still under construction) are in areas where people just don't want to live.

Some are, 300000 were empty in the census (including 'temporary' ones) leaving out the temporary ones we have 275000 empty in April 2006

Areas like Longford/Cavan/Roscommon/Leitrim have a huge number of empties relative to their overall housing stock but collectively would not even account for a tenth of the national figure .

The 2002 figures (and previous years) are here ( by county table 5 )

The 2006 figures are here ( by county table 40 at end )

I believe The 2002 table does not include temporarily absent so I will take the figures from 2006 excluding temps absent in the right hand column of the linked table ..

Dublin City 2002 Empty 8.5% 2006 Empty 11.7%
Galway City 2002 Empty 9.8% 2006 Empty 13.0%
Cork City 2002 Empty 8.1% 2006 Empty 12.0%
Limerick City 2002 Empty 7.9% 2006 empty 12.7%

National Empties 2002 11.7% 2006 15% %

2006 RISE IN EMPTIES OVER 2002 IN %

National Rise In Empties 2002 - 2006 = 28% (11.7% to 15% )

Dublin up 37%
Galway up 33%
Cork up 48%
Limerick up 60%

Average Rise In Empties in The 4 Big Cities 2002-2006 = 44.5% .


In EACH OF the 4 main cities the situation with regards to a rise in empties has WORSENED in EACH by MORE than the NATIONAL AVERAGE of 28%. Now Stop blaming the culchies !!!!!! :D K!!

Oh and I I left out Waterford which was even worse than Limerick .

Do-more

Sponge Bob wrote:

Now Stop blaming the culchies !!!!!!

Sure I'm one meself!

Interesting reading alright. The total figures for empties may pale in comparison to the cities, but the percentage vacancies in some midlands counties is truely shocking:

Longford 22.2%!!!! Worst figure in Leinster!
Leitrim 29.3% (skewed by a few more holiday homes)
Roscommon 21.8%
Cavan 21.2%

Hey and Mayo is well up there with 9,136 vacant houses! (excluding holiday homes)

Sponge Bob

Do-more wrote:

Sure I'm one meself!

Interesting reading alright. The total figures for empties may pale in comparison to the cities, but the percentage vacancies in some midlands counties is truely shocking:

supporting the theory that the crash (rather than soft or hard landing) will occur in these areas and work towards the cities from there . I cannot see any viable construction business in the north Shannon basin by next year, none....and none for decades thereafter either.

Nevertheless the Noticeable rise in overall vacancies over their long terms historic levels and which happened during the 2002-2006 period as per my inimitable graphic ....:p....



....has actually been greater in the areas with seemingly most 'demand' and where the greatest 'shortages' are held to exist by the property pimping classes .

Strange eh!

Gurgle

D'Peoples Voice

Gurgle wrote:

LOL:D well you did say you would!

I notice FG who slagged off the Government's efforts at helping first time buyers by removing first time buyers grant and increasing mortgage interest relief a few years ago are ----wait for it--- talking about increasing it themselves to help first time buyers!
Classic! so a few years ago it was worthless, now it's worth something!

Still though, for all the arguing from the opposition against reducing capital gains from 40% to 20% on property in the late nineties, I see no promises from the opposition to increase this again to 40% if they get into power, not even on development land! Auction politics - anyone?

Reyman

What's the betting that vacancy graph could hit 20% by 2010?

D'Peoples Voice

SimpleSam06 wrote:

And actually, well well, heres another interesting poll, have Irish property prices peaked?

55.16% (759 votes) - Yes
37.14% (511 votes) - No
7.7% (106 votes) - Maybe

Some of the comments in there are great...

"No they have not peaked....they may slow down but wont stop and certanly will not go back...demand for houses for next 3 years is very high...
Smooth, Cork "

"No, way, not by a long shot. Sure there's no limit to how high they can go.
Andrew, Dublin 13 "

Wonder what results this poll would throw up now if it was undertaken!

TetsuoHashimoto

chump wrote: »

I don't think anyone would disagree with you with this, but unfortunately this is not the case and is borne out by stats again and again. Investors/speculators have had a hugeee impact on the market - and if they run scared there will be trouble. They are the people who will shape the market.

expect a decade of very slow growth