Why Irish houses are still massively overpriced

Villa05

Icepick wrote: »

This depends.
Houses are expensive, but people continue to be obsessed with poorly-insulated larger-than-needed houses. Plus, the civil service is doing everything they can to avoid market pricing: Nama and banks holding stock and not repossessing, high welfare rates, artificial public employment..).
Why would apartments in established areas go significantly below the current prices? They are already cheaper/same price as any other OECD country, including (much) poorer countries.

As posted on another thread a dose of reality may help in putting a stop to the delusions you have outlined.
We are borrowing €12,000,000,000 a year to keep the show on the road
We are paying interest of €6,000,000,000 to service our debts.

In addition there are serious headwinds: Mortgage arrears crisis, pressure on our corporate tax rate, Increased costs on our business, Attempts to blow up another property bubble, Mass emigration, Pensions crisis, Out of control Health Costs etc

The first figure would pay 400,000 people €30,000 per anum (Thats 200 Dell Closure Annoncements)
The second figure would pay 200,000 people €30,000 per anum

That's 600,000 workers between our deficit and interest on our debt. Who thinks this is a sustainable situation?

Sorry for been a bit on the negative side, but I don't want to hear "We didn't see it coming" as an excuse for destroying a country

Icepick

Villa05 wrote: »

As posted on another thread a dose of reality may help in putting a stop to the delusions you have outlined.
We are borrowing €12,000,000,000 a year to keep the show on the road
We are paying interest of €6,000,000,000 to service our debts.

In addition there are serious headwinds: Mortgage arrears crisis, pressure on our corporate tax rate, Increased costs on our business, Attempts to blow up another property bubble, Mass emigration, Pensions crisis, Out of control Health Costs etc

The first figure would pay 400,000 people €30,000 per anum (Thats 200 Dell Closure Annoncements)
The second figure would pay 200,000 people €30,000 per anum

That's 600,000 workers between our deficit and interest on our debt. Who thinks this is a sustainable situation?

Sorry for been a bit on the negative side, but I don't want to hear "We didn't see it coming" as an excuse for destroying a country

Only bankruptcy will put stop these delusions being pursued.
There isn't a possible government coalition that doesn't involve at least one socialist/populist party.

Villa05

Icepick wrote: »

Only bankruptcy will put stop these delusions being pursued.
There isn't a possible government coalition that doesn't involve at least one socialist/populist party.

The budget cuts up to last year were mainly on capital projects, the remaining cuts will be more close to the bone and hit hard.

Bailout deal finishes at the end of this year, no guarantee that we can get cheap finance after that.

The correct figure for the interest we are paying on our debt is actually €8.500,000,000 and amounts to 20% of the states all tax income. Bankruptcy is not that far from here.

The present Gov has actually done very to stabilise employment in the face of such cuts, It gets alot harder from here though

Potatoeman

OMD wrote: »

You have a lot of statements there that are simply your opinion nothing more. The benefits of breast feeding after the child is 6 months old are non-existent (the benefits during the first 6 months are not as clear-cut as you imply but that is a different argument). As maternity leave is now over 6 months this point is a red herring.

You imply house prices were affordable when only one person worked but now they are not with 2 working. That is just nonsense so I'm afraid you need to provide evidence.

There are some US studies that back this up. Couples buy property in the best school area they can afford, leaving single parents unable to compete and families with less diaposable income than pre 1950-60's.

ChRoMe

maninasia wrote: »

I'm sorry but I'm not impressed by the usual 'I'm a mother of XXX kids', 'I'm also a father of xxx kids', I don't think it's very relevant to personalise your statement as we can all do that.

So in other words you want to be excused while you dismiss her anecdotal evidence for your own anecdotal evidence.

boarsboard

price house by rent x 15 years by rent

you can see if its over valued say rents are 800 month x12 then x 15

OMD

boarsboard wrote: »

price house by rent x 15 years by rent

you can see if its over valued say rents are 800 month x12 then x 15

Based on what?
Is this formula applicable all over the Western World or is Ireland a special case?

L1011

boarsboard wrote: »

price house by rent x 15 years by rent

you can see if its over valued say rents are 800 month x12 then x 15

Overly simply metric. By that, every 1 bed apartment in Dublin is massively undervalued yet their prices keep falling.

Farmer Pudsey

boarsboard wrote: »

price house by rent x 15 years by rent

you can see if its over valued say rents are 800 month x12 then x 15

Where did you come up with this pricing structure. So if I buy a house and rent it, it will cost me 100 euro/ month more than the present rent over 20 years at with ECB rates averaging 3.5% over the 20 year period.

The house would be paying for itself after year five and turning a profit after year 10.

Villa05

While our own mortgage crisis shows no sign of abating, according to my next guest, Britain's housing market is still dangerously dysfunctional...

In his new book, The Default Line, he traces the origins of the British housing bubble and argues that an entire generation are paying absurd prices for a basic human need - and it doesn't have to be this way.

http://www.rte.ie/radio/utils/radioplayer/rteradioweb.html#!rii=9%3A20432182%3A15036%3A04%2D09%2D2013%3A

Geuze

Villa05 wrote: »

The correct figure for the interest we are paying on our debt is actually €8.500,000,000 and amounts to 20% of the states all tax income. Bankruptcy is not that far from here.

2012 interest bill was 6,133m.

2013 interest bill to be 8,239m planned.

Heartbreaking.

http://www.cso.ie/en/releasesandpublications/nationalaccounts/governmentfinancestatistics/

Geuze

Villa05 wrote: »

The correct figure for the interest we are paying on our debt is actually €8.500,000,000 and amounts to 20% of the states all tax income. Bankruptcy is not that far from here.

This is a key point.

Gen Govt revenue is approx 56bn during 2009-2012.

Interest was:

2009 = 3bn approx
2012 = 6bn approx

2013 planned = 8,239m

The interest bill has nearly tripled, and now accounts for 15% of Govt revenue.

This does mean very tight Budgets ahead.

http://www.cso.ie/en/releasesandpublications/er/gfsa/governmentfinancestatisticsapril2013/#.UiexHdK-qrw

jetfiremuck

As I see it if the Gov keep taking money out of the economy with on going austerity and punitive taxes there will be no incentive for anyone to hire,expand or even spend money.

realitykeeper

Icepick wrote: »

Why would apartments in established areas go significantly below the current prices? They are already cheaper/same price as any other OECD country, including (much) poorer countries.

Houses prices have fallen almost 60% already and this reflects the domestic reality. I think the double dip will be caused by events overseas. The most likely instigator will be the attempts to taper QE by the Fed in the US.

maninasia

ChRoMe wrote: »

So in other words you want to be excused while you dismiss her anecdotal evidence for your own anecdotal evidence.

No, I provided links to scientific research and discussion of the results, go back and read my posts and then read her posts.

There is also a lot of research that points to double earning couples being partly responsible for house price inflation, which is fairly common sense if you think about it.

Dannyboy83

http://www.broadsheet.ie/2013/09/10/a-solicitor-should-have-a-house-that-accords-with-his-status-in-society/#comments

A Solicitor Should Have A House That Accords With His Status In Society

I had to double check if the above wasn't the 'Waterford Whisperer'

jmayo

Dannyboy83 wrote: »

I had to double check if the above wasn't the 'Waterford Whisperer'

Yes mr jim stafford believes the rest of us should pay to make sure accountants, consultants and solicitors gets to keep their status houses.

The fooking sense of entitlement in this fooking country is simply astonishing.

gaius c

Say what you will about him but he created an account on p.ie to respond to the thread about him and attempt to explain himself. I don't remotely like what he said (and don't buy his "explanation") but I do have a certain amount of respect for the extreme bravery he's shown in making an account under his real name and wading into a thread where he's being castigated right, left & centre.

Icepick

jmayo wrote: »

Yes mr jim stafford believes the rest of us should pay to make sure accountants, consultants and solicitors gets to keep their status houses.

The fooking sense of entitlement in this fooking country is simply astonishing.

Check the rates insolvency administrators charge for their services.

Villa05

gaius c wrote: »

Say what you will about him but he created an account on p.ie to respond to the thread about him and attempt to explain himself. I don't remotely like what he said (and don't buy his "explanation") but I do have a certain amount of respect for the extreme bravery he's shown in making an account under his real name and wading into a thread where he's being castigated right, left & centre.

Gaius, your getting a bit soft. The guy left the cat out of the bag in a live interview. He inadvertently told the truth. His Status and reputation which he values so highly is seriously damaged as a result.
He is now looking for stupidity forgiveness as opposed to debt forgiveness

gaius c

Villa05 wrote: »

Gaius, your getting a bit soft. The guy left the cat out of the bag in a live interview. He inadvertently told the truth. His Status and reputation which he values so highly is seriously damaged as a result.
He is now looking for stupidity forgiveness as opposed to debt forgiveness

Well I did open a thread about it on AAM, knowing that he posts there and wondered if he would venture an explanation. I never expected in my wildest dreams that he'd pop onto P.ie to joust with the loons there.

Also, anyone heard of foreclosure stuffing before?

Voltex

gaius c wrote: »

Say what you will about him but he created an account on p.ie to respond to the thread about him and attempt to explain himself. I don't remotely like what he said (and don't buy his "explanation") but I do have a certain amount of respect for the extreme bravery he's shown in making an account under his real name and wading into a thread where he's being castigated right, left & centre.

TBH..I don't think the plank had much of a choice! He went on the national airwaves and created societal-economic divide akin to the British class structure. The minute I heard what he said my jaw dropped..I wondered how an educated and professional person who's role as a PIP requires a level of open-mindedness could broadcast such ill-thought stupidity.

Maybe his comments verify or even validate popular opinion of the professional classes in Ireland.