S&P say Irish Property Undervalued -

Tora Bora

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

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.

Permabear

This post has been deleted.

RichardAnd

beaten to it my friend

http://www.boards.ie/vbulletin/showthread.php?t=2055927195

ClayDavis

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

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

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?

gurramok

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

Banned Account

My house is undervalued.

Permabear

This post has been deleted.

gurramok

Fitzcaraldo wrote: »

My house is undervalued.

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

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.

Banned Account

gurramok wrote: »

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

danbohan

donegalfella wrote: »

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

AARRRGH

gigabit wrote: »

How dumb are Irish people?

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

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

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...

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....

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



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

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.

ei.sdraob

oppenheimer1 wrote: »

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

oppenheimer1 wrote: »

This is helped by our lowering of costs

what costs exactly have been lowered?

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



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.

gurramok

oppenheimer1 wrote: »

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.

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



what costs exactly have been lowered?

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

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

aDeener

a capitalist one would be a start

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?

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:

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?

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.

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 , youre just strawmanning there.

ei.sdraob

oppenheimer1 wrote: »

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

stepbar

ei.sdraob wrote: »

Agree with you there

Head over to the Entra & Bus forum.... that sort of opinion would be frowned upon :rolleyes:

gurramok

oppeneheimer1 wrote:

Our "recovery" will be where we settle back with a 6-7% unemployment rate, with young low skilled people leaving again.

Yes, emigration will provide the recovery. Lets get rid of our young, the 80's safety valve is back :eek:

fliball123

Hi all,

I think people make good points on here...i dont aggree that you can compare china/Japan and Ireland with regards to ecconomies or house prices. The main reason being that Ireland's people and government now have a vested interested in getting the property prices moving upward again.

I don't aggree with Nama but it is there to prop up the market and anyone thinking of buying at present is probably going to be burnt in the short them but long tem 20 years + I think buying a house as a home there is not a better tiime to do it. Put in a bid of 20%/30% less and see how you get on....

I have been looking at the so called experts and the doom mongers on here ...yes houses will come down a little further but like the boom when people kept calling the bottom very few got it right and I reckon it will be the same with the prices on the way down very few will call the floor

So good luck to anyone buying its a risk but as I say if your going to live in it for 20 years plus put a cheeky offer in and see how you get on..


But as the title says I think things are starting to turn just from general things such as friends and family finally getting a job, more people starting to go out on the weekends, taxi drivers (brother) getting more business. The company I work in giving the first payrise and bonus in 4 years. But I guess for every person like myself where things seem to be rosy in the gardin there is probably someone who has lost everything...

gurramok

fliball123 wrote: »

Hi all,

I think people make good points on here...i dont aggree that you can compare china/Japan and Ireland with regards to ecconomies or house prices. The main reason being that Ireland's people and government now have a vested interested in getting the property prices moving upward again.

I don't aggree with Nama but it is there to prop up the market and anyone thinking of buying at present is probably going to be burnt in the short them but long tem 20 years + I think buying a house as a home there is not a better tiime to do it. Put in a bid of 20%/30% less and see how you get on....

I have been looking at the so called experts and the doom mongers on here ...yes houses will come down a little further but like the boom when people kept calling the bottom very few got it right and I reckon it will be the same with the prices on the way down very few will call the floor

So good luck to anyone buying its a risk but as I say if your going to live in it for 20 years plus put a cheeky offer in and see how you get on..


But as the title says I think things are starting to turn just from general things such as friends and family finally getting a job, more people starting to go out on the weekends, taxi drivers (brother) getting more business. The company I work in giving the first payrise and bonus in 4 years. But I guess for every person like myself where things seem to be rosy in the gardin there is probably someone who has lost everything...

Hi, new poster.

Since when do high house prices benefit the people?

ei.sdraob

gurramok wrote: »

Hi, new poster.

Since when do high house prices benefit the people?

It benefits estate agents and property speculators of course

hes right about one thing, with NAMA the government now has a vested interest in re-inflating the property bubble, very sad really

fliball123

Since the additional tax money that we are paying out since 2007 is being used to prop up all the lending that the bank has been given out in mortgages and developers

I am not saying its right its damn wrong.

gurramok

fliball123 wrote: »

Since the additional tax money that we are paying out since 2007 is being used to prop up all the lending that the bank has been given out in mortgages and developers

I am not saying its right its damn wrong.

Additional tax money? No, its not sourced out of day to day revenues.

That additional tax money you speak of is gone for many decades.

fliball123

and where do you think its gone...Have you not seen the billions being pumped into the banks???? Who's paying this the gov, I dont think so. This is our taxes going to the banks anyone who denies this is delusional..

gurramok

fliball123 wrote: »

and where do you think its gone...Have you not seen the billions being pumped into the banks???? Who's paying this the gov, I dont think so. This is our taxes going to the banks anyone who denies this is delusional..

Its not day to day spending. Its added to the national debt(despite them not saying so). Its borrowed money with interest paid on it. Yes, we all will pay for it through our taxes at some point in the future, its nothing to do with the gap in the deficit.

If the money didn't go the banks, it would make zero difference to day to day revenues/spending.

I still do not see how any of this benefits the people with high house prices.

ei.sdraob

gurramok wrote: »

Its not day to day spending. Its added to the national debt(despite them not saying so). Its borrowed money with interest paid on it. Yes, we all will pay for it through our taxes at some point in the future, its nothing to do with the gap in the deficit.

If the money didn't go the banks, it would make zero difference to day to day revenues/spending.

I still do not see how any of this benefits the people with high house prices.

He is trying to deflect the thread towards a banking discussion (we have plenty)
when its a discussion about property and he is uncomfortable with your questions


we have 300,000 empty properties and 10 years worth of commercial space in Dublin alone

it is very naive to thing that construction will somehow return to its bubble year levels, and somehow the country will live of once off property taxation receipts


S&P have written "according to our calculations"
but no calculations are shown
they may as well have pulled the number out of their behind
something they are used to apparently

fliball123

how much of these 300,000 houses are in desirable locations very few I would say and I am not trying to turn this into a banking decussion. Firstly let me point out I am not for house prices rising I think they should have found a floor by themselfs and not have an artificitial landing givin by Nama and yes the money gone into the bank is added to day to day which is taken directly from our taxes which you, me your kids, your grand kids will all be paying but if house prices go up then our taxes will not be needed to cover this debt incurred by proping up the banks

ei.sdraob

fliball123 wrote: »

how much of these 300,000 houses are in desirable locations very few I would say and I am not trying to turn this into a banking decussion. Firstly let me point out I am not for house prices rising I think they should have found a floor by themselfs and not have an artificitial landing givin by Nama and yes the money gone into the bank is added to day to day which is taken directly from our taxes which you, me your kids, your grand kids will all be paying but if house prices go up then our taxes will not be needed to cover this debt incurred by proping up the banks

So house prices go up lets say to near peak levels

and you think you or the people wouldnt be paying the difference?

has nothing been learned over the last few years

fliball123

ei.sdraob wrote: »

So house prices go up lets say to near peak levels

and you think you or the people wouldnt be paying the difference?

has nothing been learned over the last few years

The differnce in what??

ei.sdraob

fliball123 wrote: »

The differnce in what??

who pays for high house prices?

you think that if the prices go back to where they where everything will be hunky dory again and everyone wins?

fliball123

ei.sdraob wrote: »

who pays for high house prices?

you think that if the prices go back to where they where everything will be hunky dory again and everyone wins?

I have never said this. I think we are f#@$cked either way if they fall we will be paying more in taxes if they rise we are back on the road to ruin.

I mean is there a scenario where this ends well?

I am not trying to provoke people just discussing pros and cons and the very basic element of ecconomics is that its swings and roundabouts and cycles

ei.sdraob

fliball123 wrote: »

I have never said this. I think we are f#@$cked either way if they fall we will be paying more in taxes if they rise we are back on the road to ruin.

I mean is there a scenario where this ends well?

I am not trying to provoke people just discussing pros and cons and the very basic element of ecconomics is that its swings and roundabouts and cycles

Yes there is a scenario where it ends well

all the waste and mal-investment gets weeded out of the system in this scenario, a lesson is learned and the economy recovers and resumes growth based on real wealth creation such as exporting

unfortunately we are going on a different road. a road where recklessness is rewarded by socializing the risks (bailouts) and NAMA, a road which will endup with another larger boom and bust cycle

enjoy the ride

fliball123

ei.sdraob wrote: »

Yes there is a scenario where it ends well

all the waste and mal-investment gets weeded out of the system in this scenario, a lesson is learned and the economy recovers and resumes growth based on real wealth creation such as exporting

unfortunately we are going on a different road. a road where recklessness is rewarded by socializing the risks (bailouts) and NAMA, a road which will endup with another larger boom and bust cycle

enjoy the ride

Can we wear seatbelts .... I think your scenario that ends well will not end well for any poor person who bought in the years between say 2005 - 2008 now I would not feel sorry for an investor but some people were dupped into thinking the bubble would never burst. I think I read somewhere that the number of FTBs in that period was very high so i do not think there is a happy ending for everyone.

ei.sdraob

fliball123 wrote: »

Can we wear seatbelts .... I think your scenario that ends well will not end well for any poor person who bought in the years between say 2005 - 2008 now I would not feel sorry for an investor but some people were dupped into thinking the bubble would never burst. I think I read somewhere that the number of FTBs in that period was very high so i do not think there is a happy ending for everyone.

Ah sure, bail them out too

funny how you are all up in arms about bank bailouts but the propose a similar waste of money

consistency is a great thing :cool:

fliball123

ei.sdraob wrote: »

Ah sure, bail them out too

funny how you are all up in arms about bank bailouts but the propose a similar waste of money

consistency is a great thing :cool:

Never said that either to bail them out just pointing out that your happy ending is for yourself but not for all. Just said in your scenario it would be hard on them.

fliball123

also just done a quick scan of daft

91,450 properties for sale
out of these around 1/3 where in

Dublin, Meath, Wicklow, Kildare, Galway, Cork, Waterford and Limerick,

These are the 8 most densely populated areas in Ireland. Which means 2/3 are in the remaining counties so the whole 300,000 overhang argument doesnt wash