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S&P say Irish Property Undervalued -

  • 01-06-2010 11:19AM
    #1
    Closed Accounts Posts: 1,258 ✭✭✭


    Ah shure, it will be grand, what are ye all worrying about :D

    http://www.irishtimes.com/newspaper/breaking/2010/0601/breaking27.html
    Irish property 'could be undervalued'


    CIARA O'BRIEN
    Ireland's property market could be undervalued, a new report said today, with the steady fall in house prices caused by oversupply in the market.
    However, the report from Standard and Poor's did not rule out further declines in prices.

    In a report on the European housing market published today, S&P said Ireland's ongoing market correct "seems overdone", and estimated priceds were undervalued by about 12 per cent.

    The agency said Irish house prices, which recorded an 18.5 per cent decline in the 12 months ending December 2009, were showing a marked difference to other European markets, which have displayed signs of pulling out of the recent price correction.

    "Fundamentals driving the Irish market have nevertheless improved dramatically. The market appears undervalued today compared with long-term historical averages," the report said.

    Mortgage lending continued to fall, however, despite falling interest rates contributing to a rise in affordability for buyers.

    House completions are also falling, with 26,420 completed last year compared with 51,724 a year earlier, according to Government figures. In the first quarter of the year, completions totalled 3,759 - almost half of the figure recorded a year earlier.

    However, rents continue to fall, slipping 13 per cent in the 12 months to March, following a 30 per cent decrease in 2009.

    "We think the economy will likely remain unsupportive for another year at least," S&P said.

    The report said consumer caution stemming from unemployment and fiscal tightening by the Government would contribute to further house price falls, with predictions of a further 10 per drop over the year before it finally hits a trough in 2011.

    Meanwhile, the price slump has slowed in many European countries, including France, Italy, Spain, and the Netherlands. But the report warned the correction may not be over, and said there was the possibility of a second dip in several markets, either later this year or in early 2011.


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Comments

  • Closed Accounts Posts: 39,019 ✭✭✭✭Permabear


    This post has been deleted.


  • Registered Users, Registered Users 2 Posts: 4,121 ✭✭✭RichardAnd




  • Registered Users, Registered Users 2 Posts: 761 ✭✭✭ClayDavis


    "There's never been a better time to buy!" :rolleyes:


  • Closed Accounts Posts: 9,364 ✭✭✭ei.sdraob


    "Fundamentals driving the Irish market have nevertheless improved dramatically.

    you hear that

    the fundamentals are strong!

    2007 called and wants its slogans back :)


  • Closed Accounts Posts: 72 ✭✭gigabit


    Stupidity again.

    How is that possible with over 300,000 empty properties around the country, and unemployment of nearly 20% of working population.

    How dumb are Irish people?


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  • Closed Accounts Posts: 13,992 ✭✭✭✭gurramok


    I'd wish they show examples of undervalued property as I certainly cannot find any.


  • Closed Accounts Posts: 1,553 ✭✭✭Banned Account


    My house is undervalued.


  • Closed Accounts Posts: 39,019 ✭✭✭✭Permabear


    This post has been deleted.


  • Closed Accounts Posts: 13,992 ✭✭✭✭gurramok


    My house is undervalued.

    How did you come to that conclusion or are you missing a smiley?;)


  • Closed Accounts Posts: 457 ✭✭hiorta


    What's wrong wit ya? Get out buying houses, holidays, cars and give the leeches another bite at the cherry. They've spent all your earlier money and hope for a refill.


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  • Closed Accounts Posts: 1,553 ✭✭✭Banned Account


    gurramok wrote: »
    How did you come to that conclusion or are you missing a smiley?;)

    :D;)


  • Closed Accounts Posts: 1,914 ✭✭✭danbohan


    This post has been deleted.

    and rural based housing like what you have bought will become more sought after especially with new planning conditions that will greatly limit if not stop one off houses in countryside , just see what that has done to rural house prices/sites in northern ireland


  • Closed Accounts Posts: 12,382 ✭✭✭✭AARRRGH


    gigabit wrote: »
    How dumb are Irish people?

    Quite dumb. It never ceases to amaze me how many people don't use their brain.


  • Closed Accounts Posts: 9,364 ✭✭✭ei.sdraob


    AARRRGH wrote: »
    Quite dumb. It never ceases to amaze me how many people don't use their brain.

    Now now, you are the one who want to reward their "dumbness"

    by taking money from productive people/companies and rewarding the eejits who took on too much debt

    yes and "debt forgiveness" would mean more money would need to be transferred from remaining taxpayers to the banks, that we now own


  • Closed Accounts Posts: 12,382 ✭✭✭✭AARRRGH


    ei.sdraob wrote: »
    Now now, you are the one who want to reward their "dumbness"

    by taking money from productive people/companies and rewarding the eejits who took on too much debt

    yes and "debt forgiveness" would mean more money would need to be transferred from remaining taxpayers to the banks, that we now own

    I think you're misunderstanding what I am saying in that thread.

    I am saying it is unfair. But I am also saying do we *realistically* have a choice?

    I know most people here think we should dump half the PS and drastically reduce the dole etc., and I agree they would in theory be good solutions, but they are quite idealistic solutions...


  • Closed Accounts Posts: 6,123 ✭✭✭stepbar


    S&P - the crowd that didn't see sub prime coming.... I think I'll take their opinion with a spec (not a pinch) of salt....


  • Closed Accounts Posts: 9,364 ✭✭✭ei.sdraob


    AARRRGH wrote: »
    I think you're misunderstanding what I am saying in that thread.

    I am saying it is unfair. But I am also saying do we *realistically* have a choice?

    I know most people here think we should dump half the PS and drastically reduce the dole etc., and I agree they would in theory be good solutions, but they are quite idealistic solutions...

    yes we do realisticly have a choice

    as Prof Niall Ferguson put it, there are 3 ways out of a debt scenario:

    * cut
    * default
    * devalue

    .jpg

    what your suggesting is a form of default, me and others have pointed that out to you in your parallel thread


  • Closed Accounts Posts: 5,733 ✭✭✭oppenheimer1


    ei.sdraob wrote: »
    you hear that

    the fundamentals are strong!

    2007 called and wants its slogans back :)

    Fundamentals, being exports are growing again. This is helped by our lowering of costs and the weakness in the euro.

    Even doom monger you are can't deny that.


  • Closed Accounts Posts: 9,364 ✭✭✭ei.sdraob


    Fundamentals, being exports are growing again. This is helped by our lowering of costs and the weakness in the euro.

    Even doom monger you are can't deny that.

    This "doom-monger" here is in the exporting business himself, im doing quite well, thanks for asking :)


    Even a 100% increase in exports would not help the HUGE deficit and banking problem this country has, and the export sector employs a small portion of the population, which is of little comfort to the hundreds of thousands of unemployed now

    China also has strong exports, but most of the population is in poverty, think about it...

    You could have a lot of exports but with the low corporation tax, the state could only tap into small portion of this, and by raising the tax it kills these very exports.

    on the other hand, what do I care, carry on :D

    This is helped by our lowering of costs
    what costs exactly have been lowered?


  • Closed Accounts Posts: 5,733 ✭✭✭oppenheimer1


    ei.sdraob wrote: »
    This "doom-monger" here is in the exporting business himself, im doing quite well, thanks for asking :)


    Even a 100% increase in exports would not help the HUGE deficit and banking problem this country has, and the export sector employs a small portion of the population, which is of little comfort to the hundreds of thousands of unemployed now

    China also has strong exports, but most of the population is in poverty, think about it...

    You could have a lot of exports but with the low corporation tax, the state could only tap into small portion of this, and by raising the tax it kills these very exports.

    on the other hand, what do I care, carry on :D



    what costs exactly have been lowered?

    Wage costs in the private sector have fallen (before you quote some economic blog - most competitiveness figures include the public sector, which distorts the figures) Allied to the 15% drop in the euro, we are significantly more competitive than we were in 07.

    While increases in exports may not produce much in terms of corporation tax, it generates employment. Not only that, but the best kind of employment with wages paid with money brought in from outside the state.


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  • Closed Accounts Posts: 13,992 ✭✭✭✭gurramok


    While increases in exports may not produce much in terms of corporation tax, it generates employment. Not only that, but the best kind of employment with wages paid with money brought in from outside the state.

    Where has there been an increase in employment numbers? Hint: the last release from the CSO confirmed they were still falling.

    While you're at it, show us an undervalued house in Ireland where people want to live.


  • Closed Accounts Posts: 2,487 ✭✭✭aDeener


    ei.sdraob wrote: »
    This "doom-monger" here is in the exporting business himself, im doing quite well, thanks for asking :)


    Even a 100% increase in exports would not help the HUGE deficit and banking problem this country has, and the export sector employs a small portion of the population, which is of little comfort to the hundreds of thousands of unemployed now

    China also has strong exports, but most of the population is in poverty, think about it...

    You could have a lot of exports but with the low corporation tax, the state could only tap into small portion of this, and by raising the tax it kills these very exports.

    on the other hand, what do I care, carry on :D



    what costs exactly have been lowered?

    ffs would you at least compare like with like. 2 completely different market make ups.... :rolleyes:


  • Closed Accounts Posts: 9,364 ✭✭✭ei.sdraob


    aDeener wrote: »
    ffs would you at least compare like with like. 2 completely different market make ups.... :rolleyes:

    fair enough

    who would you compare ireland to?

    im having a hard time finding any countries and people as endebted


  • Closed Accounts Posts: 2,487 ✭✭✭aDeener


    a capitalist one would be a start


  • Closed Accounts Posts: 9,364 ✭✭✭ei.sdraob


    aDeener wrote: »
    a capitalist one would be a start

    I recommend you lookup the definition and wikipedia article on capitalism and china :rolleyes:

    anyways both you and @oppenheimer1 missed my point
    while yes its great that exports are staying strong
    this alone will not pull the economy out of the hole we are in

    * will the export sector create 400,000 jobs directly and/or indirectly?
    * will the export sector somehow plug the 20 billion a year deficit?


  • Closed Accounts Posts: 2,487 ✭✭✭aDeener


    ei.sdraob wrote: »
    I recommend you lookup the definition and wikipedia article on capitalism and china :rolleyes:

    anyways both you and @oppenheimer1 missed my point
    while yes its great that exports are staying strong
    this alone will not pull the economy out of the hole we are in

    * will the export sector create 400,000 jobs directly and/or indirectly?
    * will the export sector somehow plug the 20 billion a year deficit?

    okay if you want to nit pick - one which is not ruled by a communist party. now hows that? :rolleyes:


  • Closed Accounts Posts: 9,364 ✭✭✭ei.sdraob


    aDeener wrote: »
    okay if you want to nit pick - one which is not ruled by a communist party. now hows that? :rolleyes:

    does it matter what they are called?

    they economic policies are mercantilist, top down controlled and planned, and they are good at playing the globalisation game
    these all are flavours of capitalism


    how about Japan then, they have a strong export sector
    but their economy has been stagnating for 2 decades now


    and feel free to address this
    * will the export sector create 400,000 jobs directly and/or indirectly?
    * will the export sector somehow plug the 20 billion a year deficit?


  • Closed Accounts Posts: 5,733 ✭✭✭oppenheimer1


    ei.sdraob wrote: »
    I recommend you lookup the definition and wikipedia article on capitalism and china :rolleyes:

    anyways both you and @oppenheimer1 missed my point
    while yes its great that exports are staying strong
    this alone will not pull the economy out of the hole we are in

    * will the export sector create 400,000 jobs directly and/or indirectly?
    * will the export sector somehow plug the 20 billion a year deficit?

    Well in theory yes. Ireland is too small to sustain a sustainable economy based on domestic consumption. If theres anything that has to be learned from the boom and subsequent bust its that. Therefore any recovery has to be export led. I am also under no illusion that we will be going back to the days of full employment either, we are simply uncompetitive in areas of low skill. It is unfortunate that a lot of people fall into this category. In particular many in the building trade, labourers etc. During the good times they earned wages far above what their skill level should have dictated. The deficit won't be plugged alone by increasing numbers in employment, but by a combination of increased taxes, more in employment and a reduction in entitlement. Much of the welfare state will be unwound in the next decade, no matter the government, it has to be.

    Our "recovery" will be where we settle back with a 6-7% unemployment rate, with young low skilled people leaving again. We will battle to balance the books for the next two decades. But the bad times that exist now will not be around forever. Assuming the markets stay up, and there is no second global recession, we will see real falls in unemployment by the end of 2010. Employment rates usually lag GDP by 6 or so months which in turn lag the markets by 6 months.

    We will prosper again, but not in the ways of the celtic tiger, but more like the ways of the old developed economies of western Europe do.


  • Closed Accounts Posts: 2,487 ✭✭✭aDeener


    ei.sdraob wrote: »
    does it matter what they are called?

    they economic policies are mercantilist, top down controlled and planned, and they are good at playing the globalisation game
    these all are flavours of capitalism


    how about Japan then, they have a strong export sector
    but their economy has been stagnating for 2 decades now


    and feel free to address this

    yes it does, it is ludicrous to compare a small open economy like ireland with the 2nd and 3rd largest economies in the world. not to mention the population differences and market structure differences. christ.


    "good at playing the globalisation game" - which ireland in comparison does not play, - thanks for strengthening my point...

    hmm one key flavour of capitalism you are interestingly forgetting is the level of state ownership.... methinks it is somewhat higher than ireland dont you??

    i dont have to address those questions as i only called you out on the silly comparison between china and ireland, i never disputed those points you made - you clearly read my post well didnt you .... but:

    depending on the growth of the export sector it will most certainly create jobs,as when x>m it increases aggregate demand which increases GDP. 400,000 though? more than likely nowhere close, but jobs will definitely be created that there is no disputing. i dont think anyone here has advocated a plan focused solely on exports :confused:, youre just strawmanning there.


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  • Closed Accounts Posts: 9,364 ✭✭✭ei.sdraob


    Well in theory yes. Ireland is too small to sustain a sustainable economy based on domestic consumption. If theres anything that has to be learned from the boom and subsequent bust its that. Therefore any recovery has to be export led. I am also under no illusion that we will be going back to the days of full employment either, we are simply uncompetitive in areas of low skill. It is unfortunate that a lot of people fall into this category. In particular many in the building trade, labourers etc. During the good times they earned wages far above what their skill level should have dictated. The deficit won't be plugged alone by increasing numbers in employment, but by a combination of increased taxes, more in employment and a reduction in entitlement. Much of the welfare state will be unwound in the next decade, no matter the government, it has to be.

    Our "recovery" will be where we settle back with a 6-7% unemployment rate, with young low skilled people leaving again. We will battle to balance the books for the next two decades. But the bad times that exist now will not be around forever. Assuming the markets stay up, and there is no second global recession, we will see real falls in unemployment by the end of 2010. Employment rates usually lag GDP by 6 or so months which in turn lag the markets by 6 months.

    We will prosper again, but not in the ways of the celtic tiger, but more like the ways of the old developed economies of western Europe do.

    Agree with you there :)


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