Property Value

girasole225

here we are
August 2010.... They say the property values is now the same as 9 years ago....
Does this mean it is now a good time to buy or is the value of the properties going to drop farther? and for how long? When would it be the best time to buy?
if I look around the property sites, I see a significant drop of really nice houses (3 bedrooms) but still in areas such as Blanchardstown, Talah, Balbriggan, Lucan, Finglas, Clondalkin.
Will we ever going to see a real drop where we can afford a house worth 200 K in the south side of the city near the dart for example?

Welease

girasole225 wrote: »

here we are
August 2010.... They say the property values is now the same as 9 years ago....
Does this mean it is now a good time to buy or is the value of the properties going to drop farther? and for how long? When would it be the best time to buy?
if I look around the property sites, I see a significant drop of really nice houses (3 bedrooms) but still in areas such as Blanchardstown, Talah, Balbriggan, Lucan, Finglas, Clondalkin.
Will we ever going to see a real drop where we can afford a house worth 200 K in the south side of the city near the dart for example?

You are asking people to predict the future..... Generally an imprecise science

changes

There is still a large difference between what people think their houses are worth today with what they are actually worth.

Also, you know this country and the attitude we have to owning property too. Imo as soon as the banks start lending again and the first green shoots appear i think that is the day that prices will stop falling.

ei.sdraob

Why don't you holdout and save more? is there a specific need or rush??

Prices are still going down whether you listen to daft or esri reports

Bank lending is getting tighter so you would need a large deposit anyways and rates have only one way to go, so get used to putting away a large chunk of your earnings now

girasole225

Thank you guys
ei.sdraob I don't have any rush in buying now of course, I know we can't predict the future but I just wanted to know if you guys think there is any chance whatsoever that we can effort one day a house worth the way they are now but in a very nice part of Dublin.
At the moment you can easily buy a nice house for less then 200K but the areas are not so great. Will we ever managed to get the same price house in Monkstown for example? or is this a question to which we can't give an answer, just a big question mark?
As for the time it's taking for the properties to drop, I have the impression the banks are starting to lend money perhaps not as it used to be but easier then a year ago. would you guys say it will most likely be an other year, few months before the drop ends? I am not asking for a specific answer of course but just an idea on what's going on.

changes

girasole225 wrote: »

Thank you guys
ei.sdraob I don't have any rush in buying now of course, I know we can't predict the future but I just wanted to know if you guys think there is any chance whatsoever that we can effort one day a house worth the way they are now but in a very nice part of Dublin.
At the moment you can easily buy a nice house for less then 200K but the areas are not so great. Will we ever managed to get the same price house in Monkstown for example? or is this a question to which we can't give an answer, just a big question mark?
As for the time it's taking for the properties to drop, I have the impression the banks are starting to lend money perhaps not as it used to be but easier then a year ago. would you guys say it will most likely be an other year, few months before the drop ends? I am not asking for a specific answer of course but just an idea on what's going on.

What price are they looking for for a nice house in monkstown at the min?

Laminations

girasole225 wrote: »

At the moment you can easily buy a nice house for less then 200K but the areas are not so great. Will we ever managed to get the same price house in Monkstown for example? or is this a question to which we can't give an answer, just a big question mark?

A house's price is partly if not significantly determined by it's location so why for the life of me you think an equivalent sized house in monkstown and Finglas would be equivalent prices is beyond me. The prices in the housing Market are all relative. A house in a nice area WILL ALWAYS be worth more than the same size house in a less desirable area.

girasole225

Hi Laminations
I was already aware on the fact that prices of properties in nice areas will always be higher then the once in different areas, it will always be like that no matter what.
My question was different, I was inquiring if the prices of properties of average areas right now will be eventually the same as the once from nice area in the future when the prices will reach the bottom.
In few words will we ever get to a stage where a house in Blanchertown will be worth say 90K and the one in Monkstown 200K?

Laminations

girasole225 wrote: »

Hi Laminations
I was already aware on the fact that prices of properties in nice areas will always be higher then the once in different areas, it will always be like that no matter what.
My question was different, I was inquiring if the prices of properties of average areas right now will be eventually the same as the once from nice area in the future when the prices will reach the bottom.
In few words will we ever get to a stage where a house in Blanchertown will be worth say 90K and the one in Monkstown 200K?

Well how long is a piece of string? Our opinion on this doesn't matter. If you think a house is worth the price then that's all that counts, unless of course you are buying as an investment. What do you consider to be a reasonable price for a house in monkstown? If they are at that level then buy, if not then wait. Maybe you'll need to compromise and realise you can't afford a reasonably priced house in monkstown, maybe not. Our opinions are simply that, opinions, based on what we each consider reasonable.

McDougal

All the indictations are that prices will continue to fall.

changes

It would be hard to see prices in sought after areas of dublin dropping very low imo.

Someone was on here recently saying in the nicer parts of mullingar houses are coming on the market and are sold within a month, even now, while in other parts of the same town houses are not selling even though they have dropped in price.

girasole225

mmh I guess you have to be lucky to find the perfect house at the perfect price :rolleyes: even in the current scenario...

Mr. Mac

House prices will continue to fall as long as we continue to lose jobs. Until the time comes when we start to create employment as a good rate will we see prices start to climb again (that will be at a slow rate).

My guess is they will fall by another 5-10% over the next 12 -18 months. Stabilise for a further couple of years and remain at that level until we start reducing the numbers signing on.

I wouldnt necessarily rule out buying property now especially if u have your heart set on it as you wont make any significant loses. But if u can hold out for a further few months then that would be the best thing to do.

WalterMitty

We know asking prices are still crazy as rental yields are still so low. Ignore asking prices other than as a general starting price to work down from. Multiply what a similar property is renting for oer month by 12 months that are in a year. Then multiply this figure by say 15 to give an attractive price for such a property. That gives you a price that offers a 7% gross rental yield, which is what you would want considering costs of ownership and alternative investment opportunities.

ricman

I THINK its simplistic to say southside= nice areas ,northside=bad,santry,beaumont,clontarf,phibsboro,glasnevin are nice places to live.
i lived on the southside,and the northside,and id say theres very little difference between living in goatstown vs living in beaumont apart from the dart accent.
Houses in goatstown, are around 580k, so maybe they might go down to 500k, so great, do you really want to go to a bank and borrow 500k= 1million loan payback.IN A RECESSION, with firms closing down, shops closing ,taxes rising etc thats assuming a bank would lend you 450k.
I EXPECT PRICES in dublin to go down by ten/20 per cent ,but no one can predict the future ,but i think it,ll take at least 5 years for the economy to improve ,and even then we will be loaded with government dept .
i suppose some people think theres no good quality of life on the northside, which is completely ridiculous and narrow minded.Theres plenty of doctors,lawyers ,middle class people who are perfectly happy to live on the northside.
lets say prices go down to 300k on the southside, it,ll probably be very hard to borrow 300k at that stage because the economy will be even worse than it is now.And credit will be tight.
so to take goatstown as an example, we,ll probably never see prices there going down to
200k, unless the economy collapses ,in which case whos gonna lend you 200k?
i think in some cases banks are refusing mortgages, cos they think x might lose his job,
, houses are losing value, they need to build up their reserves,and they are tightening up the criteria for loan approval.
A house in rathmines,will always be worth alot more than a house in finglas.

dan_d

To say southside is good and the northside is bad is totally ridiculous. Obviously, I'm a northsider, out in North County Dublin. Houses aren't ridiculous and they are just as nice as the southside. The southside will always cost more, because people perceive it to be a "nice" place and therefore will be willing to spend more.

House prices will in all likelihood drop more, although how much exactly nobody can tell. BUT.....in all the chat about houses and how low they go, 2 other important items tend to glossed over. Firstly, interest rates. I hate to say - they can only go up. So this time next year, you might find a house that's dropped fifty grand, but you'll be only able to get a mortgage of about 5/6% - maybe more (slight exaggeration perhaps). They don't do tracker mortgages any more, and our banks are so screwed, their interest rates can only go up. Secondly, how much the bank is prepared to lend you based on your job security and your partners relative income, as compared to how much they would have lent you 3 years ago. A lot less for many people, I would imagine.

So it's not just the price of the house to be taken into account - there's a number of other factors aswell. But to answer your original question, then yes, I would imagine they will go down some amount more, but it cannot be quantified.

Sea Sharp

Prices will keep on coming down due to the basics of supply and demand. I think there's a good possibility that property prices in Ireland will follow a similar trend to that of Japan over the last 30 years:

astrofool

Japan had massive deflation. Being part of the euro, we won't (that's not saying prices won't fall, just that our model won't follow japan).

We're going to have to inflate at some stage, it's the only way to reduce the debt burden that's stifling the economy.

Permabear

This post has been deleted.

mrgaa1

not much more to fall. There are houses being sold for less than what it costs to buy the land, pay the fees and build and finish the house.
Certainly there are areas where property may have a bit more to go - but others where it probably has more or less settled. Unfortunately current the economic climate especially the job situation will mean it will take sometime before some confidence comes back to the market.
Also some places need to be dozed as they are becoming a huge health and safety problem

North_West_Art

unemployment is at its highest since 1991... if this figure isn't corrected soon, we might see property prices starting to reflect what prices were back then. In terms of supply and demand, we have an over supply, and a lack of demand.. and until banks start to offer people mortgages here again, property will be worth what the seller can get for it

SkepticOne

mrgaa1 wrote: »

not much more to fall. There are houses being sold for less than what it costs to buy the land, pay the fees and build and finish the house.

How is that relevant?

catbear

astrofool wrote: »

Japan had massive deflation. Being part of the euro, we won't (that's not saying prices won't fall, just that our model won't follow japan).

We're going to have to inflate at some stage, it's the only way to reduce the debt burden that's stifling the economy.

I do agree that being in the Euro could give a different outcome because of inflation in the eurozone but we still have the matter of excess supply. By various estimates there are roughly 300,000 empties for a population of just over 4m, that's a huge overhang. Also to consider is the second hand market, houses that would have been left empty will be put on the market if property rates and taxes are introduced; I think they will be.

Dublin and other large urban area will probably bottom out first but I don't expect any price rebound for a long time after that.

Nationally houses prices will probably overshoot Morgan Kellys 70% peak to bottom estimate.

dan_d

North_West_Art wrote: »

unemployment is at its highest since 1991... if this figure isn't corrected soon, we might see property prices starting to reflect what prices were back then. In terms of supply and demand, we have an over supply, and a lack of demand.. and until banks start to offer people mortgages here again, property will be worth what the seller can get for it

Which is exactly what it should be worth.

What were house prices at roughly in 1991? (I was only 9 then - things like that didn't come into my sphere of existence!). Dropping so low would create a huge gulf in mortgage owners - I wonder how we'd tackle that...

Wages do influence to a certain extent aswell though, and the types of mortgage available...if 35/40 year mortgages are no longer available, and interest rates are higher, there's only a certain percentage of a person's wage that they can afford to pay on a mortgage payment every month, reducing the amount they can afford as a mortgage. Wages would need to fall quite drastically too, and the way irish people react to that would suggest it probably won't happen.

Mister men

Unless you are desperate do not buy at present. Another 30-40% will fall off the prices of houses in the greater Dublin area.

Low Energy Eng

Just keep your eye on http://www.statusireland.com/

Highly Salami

Mister men wrote: »

Unless you are desperate do not buy at present. Another 30-40% will fall off the prices of houses in the greater Dublin area.

source?

North_West_Art

dan_d wrote: »

Which is exactly what it should be worth.

What were house prices at roughly in 1991? (I was only 9 then - things like that didn't come into my sphere of existence!). Dropping so low would create a huge gulf in mortgage owners - I wonder how we'd tackle that...

The cost of building in '91 compared to the last 7-8 increased quite a bit, so you might only be able to gauge prices based on building cost/selling price ratio.
In 1991, a new 2 story, 3 bedroom in Letterkenny (I lived in it while a student when I was 20) were being sold for IRL £ 33,000... so approx €42,000.

The same houses were going for €190,000 about 5 years ago.

Today, prices range from 159,000 to 120,000... I dodn't think Im allowed to put a link up to the properties here, but a search on Daft for Letterkenny house prices will give you an idea

*Parts of Donegal had the least inflated prices in the country

Head The Wall

House in Castlebar Brand New 3 Bed Semi D in 1995 was £29,000 still around 180-200 now

Sleepy

Cheapest 3 bed house in Clontarf on Daft.ie at the moment still has an asking price of €385,000 with the next closest having an asking price of "Excess €429,950".

Not sure how close to asking price people are getting in the area but property does seem to be moving - not too many places going up for sale and those that do seem to go inside a couple of months.

I don't agree with the market's valuation but it seems to be bottoming out in some of the nicer areas in Dublin tbh.

doc_17

A 3 bed semi for 385 is mental. OK it'll go for a bit cheaper but that is still too high. We've a way to go yet I believe before the bottom

NinjaTruncs

Head The Wall wrote: »

House in Castlebar Brand New 3 Bed Semi D in 1995 was £29,000 still around 180-200 now

Minimun wage in '95 about £1.35 an hour, mimimum wage now about €8.60. so that isn't a fair comparison, unless you want wage leveles to fall back to '95 levels.

Head The Wall

i was earning nearly £3 an hour doing student work at the time (1995), minimum wage was never used back then. I used to get paid £1.95 an hour in Galway racecourse around 91-92.

Were you working back then and what did you get paid?

syklops

Head The Wall wrote: »

House in Castlebar Brand New 3 Bed Semi D in 1995 was £29,000 still around 180-200 now

Houses prices in the past 10-15 years didnt double, or Triple, in many places they hit 10 times what they were worth in the Early 90's.

My parents house was bought around 1990 at a cost of 55000 IRL. Its a large 4-bedroom house, 3 bathrooms, 1 en-suite, half an acre Garden, about 20 mins from

It was valued last year at about 600,000 euro.

Rock bottom? We are no-where near it.

Add in all the shoddily built houses that were hacked together in the last decade, and IMO we wont be anywhere near the bottom until some houses are going for sub 20,000.

hobochris

NinjaTruncs wrote: »

Minimun wage in '95 about £1.35 an hour, mimimum wage now about €8.60. so that isn't a fair comparison, unless you want wage leveles to fall back to '95 levels.

Why not? It would bring down the cost of living and make us competitive again.

NinjaTruncs

Head The Wall wrote: »

i was earning nearly £3 an hour doing student work at the time (1995), minimum wage was never used back then. I used to get paid £1.95 an hour in Galway racecourse around 91-92.

Were you working back then and what did you get paid?

I worked in a lowly super market, i was only part time mind but i know many of the full time workers got the same.

hobochris wrote: »

Why not? It would bring down the cost of living and make us competitive again.

I agree, but at the moment house prices are coming down while wages are not, the way some people are going here, bertie will be aable to buy a new hour with his pension every year, i can't see us getting into a situation like that.

syklops

NinjaTruncs wrote: »

I worked in a lowly super market, i was only part time mind but i know many of the full time workers got the same.


I agress, but at the moment house prices are coming down while wages are not, the way some people are going here, bertie will be aable to buy a new hour with his pension every year, i can't see us getting into a situation like that.

I think you will find wages are coming down. Does getting made redundant not class as a wage reduction?

Does being down to a 3-day week not count as a wage reduction?

I agree the minimum wage has not gone down yet, but many skilled workers are earning now what non-skilled workers were earning only a few years ago.

NinjaTruncs

syklops wrote: »

I think you will find wages are coming down. Does getting made redundant not class as a wage reduction?

Does being down to a 3-day week not count as a wage reduction?

I agree the minimum wage has not gone down yet, but many skilled workers are earning now what non-skilled workers were earning only a few years ago.

Being made redundant and getting days cut is indeed a paycut, but it's only prorata, you still get paid X per hour worked, that X hasn't moved and it needs to.

Edit, let me say i don't mean to be so blunt about being made redundant, i just didn't want to type for ages.

docklands

Problem is we'll be 6 months off the 'property price floor' before we know it and prices will be clicking up on the increase again. The time to buy is surely when you can personally afford it? Try going for a second hand house now that looks like good value and see how many people are prepared to outbid you. You cannot believe the media - doom & gloom sells papers. Positive stories rarely make headlines.

Sponge Bob

Banks not lending and have no capacity to lend, we are years off the bottom possibly as many as 4 or 5 years.

Laminations

Sleepy wrote: »

Cheapest 3 bed house in Clontarf on Daft.ie at the moment still has an asking price of €385,000 with the next closest having an asking price of "Excess €429,950".

Not sure how close to asking price people are getting in the area but property does seem to be moving - not too many places going up for sale and those that do seem to go inside a couple of months.

I don't agree with the market's valuation but it seems to be bottoming out in some of the nicer areas in Dublin tbh.

Just with regard to this, isn't it time we got a breakdown of selling prices as they do in the UK? Why are we prevented from knowing the actual worth of houses, its a tactic that introduces uncertainty into the market

syklops

NinjaTruncs wrote: »

Being made redundant and getting days cut is indeed a paycut, but it's only prorata, you still get paid X per hour worked, that X hasn't moved and it needs to.

Edit, let me say i don't mean to be so blunt about being made redundant, i just didn't want to type for ages.

Indeed, I agree. That's one of the reasons I am against a minimum wage. The market should be allowed sort itself out. I should be allowed work for 1.95 an hour if I can make ends meet, and the company should be allowed hire me.

I am sure there is more than one company that has gone bust recently that might have survived, if it were allowed to re-negotiate it's salaries to below what is currently the minimum wage.

During the boom, increasing the minimum wage was Bertie's et el wet dream. It immediately meant the people at the bottom rung(quite a large number of voters) got more money regardless of the work ethic and regardless of their performance. Instantly more money.

Unfortunately, we are now left in a situation where it is political suicide to anyone who suggests lowering the minimum wage as it will be read by many as taking money from those who need it most. Putting families back on the bread line, etc etc. The unfortunate truth is, we need to drastically reduce the minimum wage, and regain some of our competitiveness, while at the same time bringing down costs.

It really is a bit embarrassing for us as a nation that unskilled labourers in Ireland get paid more than skilled workers such as programmers in many European countries.

Laminations

syklops wrote: »

Indeed, I agree. That's one of the reasons I am against a minimum wage. The market should be allowed sort itself out.

Unfortunately a market left unregulated leads to exploitation of the weak. Thats not saying I don't think the minimum wage should be looked at, I justr agree with the concept of a minimum wage

Sleepy

Laminations wrote: »

Just with regard to this, isn't it time we got a breakdown of selling prices as they do in the UK? Why are we prevented from knowing the actual worth of houses, its a tactic that introduces uncertainty into the market

Couldn't agree more. Judging by the fast turnaround I've seen on some houses locally (e.g. sign up for less than a month), there's definitely people out there prepared to pay the current prices though... I'm a few years away from being able to afford a deposit but I really would like to buy something around where I live. Can't see it happening short of a Lotto win though!

catbear

Laminations wrote: »

Unfortunately a market left unregulated leads to exploitation of the weak. Thats not saying I don't think the minimum wage should be looked at, I justr agree with the concept of a minimum wage

Well we had a financial regulator who did nothing for a decade so there's no guarantee that regulation will ensure anything.
The Irish gombeen culture will bypass all good logic and reason for the quick buck.

jmayo

mrgaa1 wrote: »

not much more to fall. There are houses being sold for less than what it costs to buy the land, pay the fees and build and finish the house...

Eh what has that got to do with anything ?
Ever heard at below cost selling ?
Houses just like most other things are not immune from it.

docklands wrote: »

Problem is we'll be 6 months off the 'property price floor' before we know it and prices will be clicking up on the increase again. The time to buy is surely when you can personally afford it? Try going for a second hand house now that looks like good value and see how many people are prepared to outbid you. You cannot believe the media - doom & gloom sells papers. Positive stories rarely make headlines.

Brian how the hell are you ?
How did ya enjoy the Tullamore show, there shure was a lot of bulls together with their customary bull**** at it.

Please could you enlighten us on all the recent positive stories in the Irish property market ?

wowa

I see the current property situation just the tip of the iceberg. With rent as low as it is in Ireland, why anyone would buy is beyond me. In Co Cork albeit small towns, 4-5 br family home for rent for 1000euro. Asking price for equivalent home 400-600k euro. Without a huge deposit the mortage repayments would be huge- 3-4k per month- and interest rates are going to soar.

Putting anything like the difference away in other investments is a no brainer.

Selling property from now on is going to be an eternal headache. Jobs are going to be increasingly transient so not conducive to property transactions.

The vast majority of property wealth is with the 50 plus crowd and boy are they in for a shock when they need to sell their 500k plus properties. Who is going to buy? Who can afford to buy? There are simply too many of these properties around and they will need to change hands in the next 10-20yrs. Good luck!

In the meantime, putting away 2-3k per month per household will see you in a tidy position while all the chaos is unfolding around you. Free to travel, free to take your money where you want and free from the banks and politicians meddling, which of course they will do!

Godge

mrgaa1 wrote: »

not much more to fall. There are houses being sold for less than what it costs to buy the land, pay the fees and build and finish the house.
Certainly there are areas where property may have a bit more to go - but others where it probably has more or less settled. Unfortunately current the economic climate especially the job situation will mean it will take sometime before some confidence comes back to the market.
Also some places need to be dozed as they are becoming a huge health and safety problem

Land prices have further to fall.
Professional fees of auctioneers and solicitors have further to fall.
The cost of building a house (particularly labour) has further to fall - we will be seeing more European-style building
The margins sought by developers will have to fall.

All of the above tell me that the price of housing has further to go.

If we want to compare prices, we should be looking at rural Germany, France and Spain (other than holiday regions) for prices outside Dublin comparisons. For Dublin we should be looking at secondary cities with populations around 1 million.

Head The Wall

wowa wrote: »

In Co Cork albeit small towns, 4-5 br family home for rent for 1000euro. Asking price for equivalent home 400-600k euro. Without a huge deposit the mortage repayments would be huge- 3-4k per month- and interest rates are going to soar.

Those are crazy rates, I'm currently paying 800 in Oranmore but I'm moving to Athenry (5 minutes extra travel on motorway) where a nice 3 or 4 bed can be got for 600 or less.

There's plenty of 3 and 4 beds available for under 200k

wowa

Head The Wall wrote: »

Those are crazy rates, I'm currently paying 800 in Oranmore but I'm moving to Athenry (5 minutes extra travel on motorway) where a nice 3 or 4 bed can be got for 600 or less.

There's plenty of 3 and 4 beds available for under 200k

My point is not the price of a 3-4BR home or local rent the but the fact that a home that would be listed for 400-600k euro can be rented for 1000euro. It just highlights the discrepancy between purchase cost and rental cost.

Historically to put things in perspective, property value has been approximately 12yrs rental income.

ie the above property should be worth 144k euro. Unrealistic, but again highlighting the bargain for the tenants vs them buying.

aoboa

wowa wrote: »

My point is not the price of a 3-4BR home or local rent the but the fact that a home that would be listed for 400-600k euro can be rented for 1000euro. It just highlights the discrepancy between purchase cost and rental cost.

Historically to put things in perspective, property value has been approximately 12yrs rental income.

ie the above property should be worth 144k euro. Unrealistic, but again highlighting the bargain for the tenants vs them buying.

That 12 year rent thing comes up a lot but I reckon that it's a rule of thumb.
Does it hold true for other capital cities?