Housing Bubble Bursting

whizzbang

Do-more wrote:

Well I'm sure for the farmers it is a good thing! Especially the ones selling up and buying huge farms abroad. There was a piece in the papers on one such farmer last week, selling the farm which had been in the family for over 200 years and heading to the UK!

fair point, but by using "streets ahead" it makes it sounds like the other countries will catch up, rather than there being a possibility of the prices coming down. The journal might be doing its readers a disservice here seeing as the rest of the media seems to be a bit more cautious in predicting the future of property prices.

Good for them if they can get someone to pay those prices

ronbyrne2005

Do-more wrote:

Interesting piece on land prices in the Farmers Journal

According to a survey exclusively compiled by Savills HOK, Ireland has the most expensive agricultural land in Europe. Not only that, but the average figure for Ireland is almost double the average for the second most expensive country in Europe, namely Luxembourg, indicating that Irish values are streets ahead of its European counterparts.

The figures reveal the stark reality that land in Ireland is five times more expensive than England, 6.5 times more expensive than Germany and Wales, 9.5 times more costly than Scotland, 13 times more expensive than France and a massive 40 times more costly than Poland.

We are also among most least densly populated countries in EU which makes the figures all the more ridiculous. Big falls in future.

Do-more

ronbyrne2005 wrote:

We are also among most least densly populated countries in EU which makes the figures all the more ridiculous. Big falls in future.

But remember folks, Ireland is a "special case" which makes all this sustainable!

whizzbang

Do-more wrote:

But remember folks, Ireland is a "special case" which makes all this sustainable!

yep, St Patrick drove the property crashes from Ireland centuries ago!

SimpleSam06

Not to worry, sure won't the immigrants buy every field in Leitrim.

faceman

SimpleSam06 wrote:

Not to worry, sure won't the immigrants buy every field in Leitrim.

and cavan, carlow, mayo, donegal maybe. Sure arent employment opportunities evenly distributed around ireland??? No need to have all that low density land unoccupied!

SkepticOne

whizzbang wrote:

fair point, but by using "streets ahead" it makes it sounds like the other countries will catch up, rather than there being a possibility of the prices coming down. The journal might be doing its readers a disservice here seeing as the rest of the media seems to be a bit more cautious in predicting the future of property prices.

I think it reflects the view put out by vested interests over the years and adopted by journalists and punters that rising land/housing prices are a fundamental fact of the market and that negativwe factors things like rising interest rates merely moderate the rate of growth rather than the absolute price of the land. Very high interest rates then, according to this view, would at worst bring prices to a standstill.

People are encouraged to liken the market to a growing tree. If you give it lots of water and sunshine it will grow fast. If you remove the water and sunshine it will stop growing. But it will not shrink. You often see people arguing that because certain factors are still favourable (e.g. immigration, interest rates still low by historical standards etc., still a relatively young population), house prices will continue to rise, which I think reflects this wrong view.

Until recently, the idea that prices could fall was simply not thinkable by the majority of people. The wrong model had become lodged in heads. Although this article is about farming land prices, I think the same principle applies.

pwd

http://forum.globalhousepricecrash.com/ghpc_site/index.html

whizzbang

SkepticOne wrote:

People are encouraged to liken the market to a growing tree. If you give it lots of water and sunshine it will grow fast. If you remove the water and sunshine it will stop growing. But it will not shrink. You often see people arguing that because certain factors are still favourable (e.g. immigration, interest rates still low by historical standards etc., still a relatively young population), house prices will continue to rise, which I think reflects this wrong view.

That is an incredibly good description of people seem to be thinking.

iguana

SkepticOne wrote:

People are encouraged to liken the market to a growing tree. If you give it lots of water and sunshine it will grow fast. If you remove the water and sunshine it will stop growing. But it will not shrink.

I don't know, I neglected a bonsai tree I had once and it seemed smaller after it had died and part rotted away.

Do-more

SkepticOne wrote:

Until recently, the idea that prices could fall was simply not thinkable by the majority of people. The wrong model had become lodged in heads. Although this article is about farming land prices, I think the same principle applies.

I'm amazed at the amount of people who still don't believe it! I was talking to a youngish guy in the pub Sat. who has a few "investment" properties, when I suggested that the boom was over he just didn't want to listen. I put forward the point that there are something like 240,000 vacant properties in the country and his answer to that was "but sure they are paid for, what's the problem?" Go figure!

whizzbang

Do-more wrote:

I'm amazed at the amount of people who still don't believe it! I was talking to a youngish guy in the pub Sat. who has a few "investment" properties, when I suggested that the boom was over he just didn't want to listen. I put forward the point that there are something like 240,000 vacant properties in the country and his answer to that was "but sure they are paid for, what's the problem?" Go figure!

ahh, another one of those "savvy" investors we keep hearing about.

Do-more

Every time I go past it, I get the overwhelming urge to get out with a red marker and add in the word "Bad"!

miju

well as much as i dislike our new FF / (whoever) gubberment one thing im looking forward to them doing is moving this bubble into the end game. once stamp duty changes are made and property still doesnt shift / stop falling the all bets are off

Supercell

Looks like its FF again, so no stamp duty cuts for anyone bar first time buyers which to be honest is how it should be imho.

I'm not sure if this will give us the dead cat bounce if FG etc had gotten into power.

iguana

Have FF said that they will make the stamp duty changes immediatly or will they wait til the budget? Have they actually said they will definitely remove stamp duty for FTB's or was it said with a caveat of "depending on the market?"

miju

yes FF were the only party that said they will introduce as first order of business in the new Dail as opposed to the other parties "phasing them in"

SimpleSam06

The latest in VI angels from heaven appears to be the number of new starts. I saw in the paper here in Galway, full front page, that houses here are in fact due to go up in price because there are much fewer starts next year. So the logic is, housing crash imminent, house prices will soar. Not to mention the fewer starts mean much less employment around the city, which of course will send house prices soaring.

Should have thought of that four years ago, lads.

Do-more

miju wrote:

yes FF were the only party that said they will introduce as first order of business in the new Dail as opposed to the other parties "phasing them in"

IIRC FF also committed to backdating the change in FTB stamp duty to 30th April. Would be interesting to see how many people this would actually benefit, my guess is very very few.

eth0_

Can someone explain to me the logic of removing stamp duty excemption for FTB's?
Why are they making it even more difficult for people to buy their first home?
I finally have gotten to the stage where I can buy my own place....and now i'm going to have to come up with about ten grand extra?

:mad:

miju

short term blip tbh eth0 trust that 10k the prices will TRY to go up by will drop back very quickly within a month tenfold

eclectichoney

eth0_ wrote:

Can someone explain to me the logic of removing stamp duty excemption for FTB's?
Why are they making it even more difficult for people to buy their first home?
I finally have gotten to the stage where I can buy my own place....and now i'm going to have to come up with about ten grand extra?

:mad:

eth0 they're not removing the exemption for ftbs, they are extending it so no ftbs will have to pay stamp duty at all. i'm guessing it will really only have a big impact on a small amount of ftbs in dublin where it would cost aboug 400k to get any kind of property. but mr trichet's decision next month might dispell any temporary flurry!

DubOnHoliday

as one of those that having gone sale agreed 2 weeks ago on a house stand to benefit to the extent of nearly 11k, I'll happily take accept another 5 years of FF

eclectichoney

dub based on those figures you'd have equally benefitted from fine gael i think, as they were gonna remove stamp duty for ftbs up to 450k. and it's based on when you sign the final contract rather than just sale agreed.

DubOnHoliday

FG made no indication of any time of implementation other than phasing it in over 3 years. That was not good enough for people in the same boat as me.

musiknonstop

It will be interesting to see how FF wriggle out of their stamp duty promises.

eth0_

eth0_ wrote:

Can someone explain to me the logic of removing stamp duty excemption for FTB's?
Why are they making it even more difficult for people to buy their first home?
I finally have gotten to the stage where I can buy my own place....and now i'm going to have to come up with about ten grand extra?

:mad:

I'm wondering how many second-hand properties there will be to buy, considering the stamp duty will continue to hit the non FTBs.
Personally I know of two people who were hovering on a move but have decided to stay put now they know they'll take a huge stamp duty hit.

daveirl

This post has been deleted.

Shane™

Deleted User wrote:

I'm wondering how many second-hand properties there will be to buy, considering the stamp duty will continue to hit the non FTBs.
Personally I know of two people who were hovering on a move but have decided to stay put now they know they'll take a huge stamp duty hit.

http://daftwatch.atspace.com/

Should be more than enough there

miju

thats not far of the normal yearly total of builds up until the boom started. so 45,000 properties for sale plus the vacant ones form the census plus whats due to come on stream by end of the year which is some 70,000 by most analysts figures.

thats quite a scary figure of oversupply and just as the fundamentals caused prices to rise you can be sure as night follows days that thee new fundamentals will cause them to come way down