The madness has returned

Idbatterim

That's what's in store for Ireland as - as I said above - it's clear even from this forum alone that most people haven't learned a thing and are just itching to get back on the property ladder

Who on this forum hasnt learned a thing? I'm not looking to cheerlead property or put down property, just looking to analyse the situation...

sabat

The Spider wrote: »

Missed the boat

limited supply

prices will go up.

expect continued increases in prices.

Nope rising prices for the forseeable,

best bet is to pick a secondary area , you'll miss the secondary area too.

For someone to be spouting the exact same sh1te that drove the country bankrupt is beyond comical at this stage-it's actually tragic. You are a rube and please stop poisoning the forum with this gibberish.

"A bubble comes from rising prices, whether of stocks, real estate, works of art or anything else. A price increase attracts attention and buyers, which results in even higher prices. Thus, expectations are justified by the very action that sends prices up. The process continues and optimism about the market effect is the order of the day. Prices climb even higher. Then, for reasons that endlessly will be debated, the bubble bursts."

JK Galbtaith- The Great Crash 1929

gaius c

NIMAN wrote: »

Well anyone who gets caught up in crazy house buying in the future gets all they deserve.

We have all had enough warning of how bad it can go wrong.

What about those just looking to put a roof over their heads and who are sick to their teeth of renting?

moxin

Idbatterim wrote: »

I'm not looking to cheerlead property or put down property, just looking to analyse the situation...

Why did you start the thread then with the following which is not true.

Just taking a look at some other properties in the D.14 area, some bloody serious price hikes according to the price tracker function!

2 asking price hikes and one asking price drop does not equal the "madness has returned" in D14.

Iwannahurl

Not madness in this case, perhaps, but certainly keen competition.

This run-down terraced house in the centre of Galway sold for €305k, afaik.

The people across the road expect to sell theirs for €250k, apparently.

Takes me back to, say, 2002.

The_Morrigan

sabat wrote: »

For someone to be spouting the exact same sh1te that drove the country bankrupt is beyond comical at this stage-it's actually tragic. You are a rube and please stop poisoning the forum with this gibberish.

We do not tolerate personal abuse on this forum, if you can't post in a civil or courteous manner please refrain from posting.

Morri

jmayo

For anyone that fears, as the thread title says, that the madness has returned just ask yourself this, where is the money going to come from ?

For a bubble and for massively rising prices one needs lending and lots of it.
During the bubble we had 6 indigenous banks : BOI, AIB, PTSB, EBS, INBS, Anglo.
We had foreign institutions : BOIS/Halifax, Ulster, NIB, ACC/Rabo

Those banks were competing with each other and driving lending.
They could easily borrow on the markets where credit was cheap and then lend on their customers.

Today ...
Anglo is gone.
INBS is gone.
EBS under ownership of AIB.
AIB is wholly owned by state and with massive debts.
PSTB is wholly owned by state with massive mortgage debts.
BOI is only semi privately owned indigenous bank trying to pay back state.

BOIS/Halifax has gone.
NIB has gone.
ACC/Rabo has gone.
Ulster is really only here for political reasons and it's parent RBS is really looking to offload it.
I am not counting the smaller players like KBC, smart etc.
There are no foreign institutions champing at the bit to come into Ireland because they know the place is debt riddled where people are now trying to renage on their existing debts.

It is difficult to borrow on the markets and especially difficult if you are up to your ears in unrealised debts.

So fear not I don't think there is any way in hell that we can ever return to the madness.
All that is going to happen is that some people are going to be stuck.
Those who are earning and doing well can compete for the few properties that are available.

murphaph

jmayo wrote: »

For a bubble and for massively rising prices one needs lending and lots of it.

Germany (at least specific regions) could said to be experiencing a bubble in prices and it's not because there's massively more lending taking place. Foreign investors see German property as a safe haven for their money in these uncertain times, thus driving up demand and with it prices.

I think there are foreign investors buying property in Dublin at least, given the relatively good yields they can generate (it is clearly cheaper to buy now in Dublin than rent, IF you have the funding).

For markets outside the major cities and beyond the commuter belts then I agree that for prices to rise you'd need a return to hand over fist lending, which hopefully we'll never see again (but probably will).

moxin

Some vendors just can't make up their mind (snapped from myhome.ie)
http://www.myhome.ie/residential/brochure/21-llewellyn-way-rathfarnham-dublin-14/2676097

Price History for 21 Llewellyn Way, Rathfarnham, Dublin 14

-€20,000 -5.06% €395,000 → €375,000 9:47am yesterday
€20,000 5.33% €375,000 → €395,000 9:08am yesterday

Rathfarnham, Dublin 14 Price Changes

21 Llewellyn Way, Rathfarnham, Dublin 14
-€20,000 -5.06% €395,000 → €375,000 9:47am yesterday
21 Llewellyn Way, Rathfarnham, Dublin 14
€20,000 5.33% €375,000 → €395,000 9:08am yesterday

1 Ballyroan Lodge, Rathfarnham, Dublin 16
-€29,000 -12.72% €228,000 → €199,000 25 Nov

122 Pugin House, Loreto Abbey, Lower Grange Road, Rathfarnham, Dublin 14
-€20,000 -11.43% €174,950 → €154,950 19 Nov

62 Lower Dodder Road, Rathfarnham, Dublin 14
-€45,000 -9.09% €495,000 → €450,000 2 Nov

gaius c

gaius c wrote: »

Is this to be Ireland's fate? Forever vacillating between property crash & bubble with no in between?
Going to be pretty miserable for everybody caught up in the middle of it.

Part of our problem is our population baby booms - new families aren't forming evenly over the years - those of us born in the baby boom of the late 70s and early 80s were buying or want to buy. I wonder if the relative slump in births in the 90s will lead to fewer families forming in ten years or so.

The current baby boom will have to be accommodate in three decades or so.

I might look up some statistics later.

Gmol

Yep the same thing is going to happen again but what surprises is me is that people are surprised. Prices always rise in property over the long term and even the people who bought at the height of the boom will make their money back in the medium to long term

zl1whqvjs75cdy

Are we still allowed to moan about the evil banks that tricked us into getting 120% mortgages if this goes tits up again?

Shedite27

moxin wrote: »

Some vendors just can't make up their mind (snapped from myhome.ie)
Price History for 21 Llewellyn Way, Rathfarnham, Dublin 14
-€20,000 -5.06% €395,000 → €375,000 9:47am yesterday
€20,000 5.33% €375,000 → €395,000 9:08am yesterday

I'm guessing this is to get the property added to the list of "price drops", hence more views, and people thinking it's more of a bargain.

Jolisa94

Also from that MyHome page: 8 Llewellyn Way was sold for 268,000 a couple of weeks ago http://www.myhome.ie/priceregister/8-llewellyn-way-rathfarnham-dublin-14-110961
It's looks like it needs a lot of work, but I remember viewing housed in this estate around 2002 and the asking prices were approx. 170,000 - 180,000

Idbatterim

"A bubble comes from rising prices, whether of stocks, real estate, works of art or anything else. A price increase attracts attention and buyers, which results in even higher prices. Thus, expectations are justified by the very action that sends prices up. The process continues and optimism about the market effect is the order of the day. Prices climb even higher. Then, for reasons that endlessly will be debated, the bubble bursts."

NAIL, HAMMER, HEAD, this is exactly what I meant by the self fulfilling prophecy...

Why did you start the thread then with the following which is not true.
Quote:
Just taking a look at some other properties in the D.14 area, some bloody serious price hikes according to the price tracker function!
2 asking price hikes and one asking price drop does not equal the "madness has returned" in D14.

Because I only looked at admittedly several properties and these were two of them that fit the criteria of what my mate is looking for. I am standing by my point, this isnt just a case of the asking prices being significantly higher than say 12-18 months ago, in some cases they are now being officially jacked up on top of the asking price increases (which I have no problem with, despite the fact its pretty s**t for me personally, its a free market, they should sell it for the max they can get, we would all do the same), I certainly have not seen this before now, it is a new development AFAIC. Below is another one which had the asking price jacked up 100k in a week, and not on a million euro home, on an original asking price of 445...

http://www.independent.ie/business/personal-finance/property-mortgages/asking-price-for-threebed-home-in-golden-triangle-soars-by-100k-in-just-one-week-29790863.html

I'm not saying there have been mass examples of this yet. But I dont dismiss it as some do (usually on AH), just because its in the indo... (maybe the mount merrion was just underpriced to start with OR the agent knew they could under price it, then jack it up by 100k and drum up some cheap publicity...

Maybe I should have had the thread title as "Is the madness returning to D,2,4,6,14 & select parts of SOCODU....

But the point is that really anyone who's been caught up in it hasn't really done too badly at all - oh sure there's the whole "negative equity" thing but that only matters if you're looking to sell. If you bought your place with the intention of making it a home then who cares really.

Yeah I'd agree with this technically, but imagine your Alison O'Riordan, see below link, incidentally, probably the funniest thread I have ever read on boards, you have an apartment that is worth say 200k of the origignal 525k you borrowed, psychologically, unless you have money to burn, this is going to be a constant and absolute headf**k in my opinion. why did I buy then, think of all the other things I could have done with the money and interest. What about starting a family?... (at least its a 2 bed apartment, not that its much consolation). I wonder what her situation is now...

http://www.boards.ie/vbulletin/showthread.php?t=2055860687

GemmaB

moxin wrote: »

Some vendors just can't make up their mind (snapped from myhome.ie)
http://www.myhome.ie/residential/brochure/21-llewellyn-way-rathfarnham-dublin-14/2676097

Price History for 21 Llewellyn Way, Rathfarnham, Dublin 14

-€20,000 -5.06% €395,000 → €375,000 9:47am yesterday
€20,000 5.33% €375,000 → €395,000 9:08am yesterday

Rathfarnham, Dublin 14 Price Changes

21 Llewellyn Way, Rathfarnham, Dublin 14
-€20,000 -5.06% €395,000 → €375,000 9:47am yesterday
21 Llewellyn Way, Rathfarnham, Dublin 14
€20,000 5.33% €375,000 → €395,000 9:08am yesterday

1 Ballyroan Lodge, Rathfarnham, Dublin 16
-€29,000 -12.72% €228,000 → €199,000 25 Nov

122 Pugin House, Loreto Abbey, Lower Grange Road, Rathfarnham, Dublin 14
-€20,000 -11.43% €174,950 → €154,950 19 Nov

62 Lower Dodder Road, Rathfarnham, Dublin 14
-€45,000 -9.09% €495,000 → €450,000 2 Nov

Shedite27 wrote: »

I'm guessing this is to get the property added to the list of "price drops", hence more views, and people thinking it's more of a bargain.

In fairness, this happened on our house … the EA put the price in wrong into My Home & it was changed within an hour or so. But it still shows a decrease of 50k. We weren't being indecisive or hoping that people would think it was a bargain!

gaius c

Deleted User wrote: »

Part of our problem is our population baby booms - new families aren't forming evenly over the years - those of us born in the baby boom of the late 70s and early 80s were buying or want to buy. I wonder if the relative slump in births in the 90s will lead to fewer families forming in ten years or so.

The current baby boom will have to be accommodate in three decades or so.

I might look up some statistics later.

Almost certainly. They are also the age group most affected by unemployment and are leaving the country in droves.

GavMan

Jolisa94 wrote: »

Also from that MyHome page: 8 Llewellyn Way was sold for 268,000 a couple of weeks ago http://www.myhome.ie/priceregister/8-llewellyn-way-rathfarnham-dublin-14-110961
It's looks like it needs a lot of work, but I remember viewing housed in this estate around 2002 and the asking prices were approx. 170,000 - 180,000

Doesn't need 100k worth of work though...

Ray Palmer

Kaiser2000 wrote: »

Instead they get stuck with the often farcical rental sector and the price increases that are starting to become the norm again.

If you actually look back rent increases are the norm point blank. The blip was them going down. Rents will keep going up pretty much forever to at least stay inline with inflation.

If you want to talk about a stable market that is what you are talking about increasing rents. In fact what tends to happen is property close to desirable areas increase in value and then eventually become too expensive for one household and then get divided. Look at every capital city and you will see it. The brownstones in New York, Victorian houses in London and the Georgian houses in Dublin. It is the most likely think going to happen to suburban houses in Dublin over the next 50 years.

What many people don't get is the property market is a long distance endurance race not a quick sprint.

I remember lots of people going on about how they would wait for the crash and then buy. What they missed was the banks stopped lending, they lost their jobs and fear of property would paralyze them.

So now here we stand, people who were called idiots for buying and laughed at for negative equity are in their houses. Not only are they in their houses they have trackers and have been in their homes a good time ranging from 7 years to longer. People love to mention the peak but forget not that many people bought at the peak.

Mean while those who didn't buy and planned to buy after the "madness". Still live in rented property and do not have massive savings, their rent has gone up, if they can get a mortgage they are paying much more for and they are older.

So learning from the past is being missed for some people for sure but might not be the way people are commenting on.

Say you were 30 in 2004 and waited for the madness to stop. You are now 40 maybe have a kid and are trying to get a mortgage and they only give you a 25 year one. You may be much worse off than your friend who bought in 2004. They have 15 years left and pay less for their mortgage. This isn't hypothetical really as I know people who pretty much earn the same but in vastly difference financial and living conditions.

Idbatterim

Doesn't need 100k worth of work though...

It already has DG and GFCH assuming both dont need replacing, I reckon your looking at 20-30k...

GavMan

Idbatterim wrote: »

It already has DG and GFCH assuming both dont need replacing, I reckon your looking at 20-30k...

Precisely.

I'm highlighting the discrepancy in price in price...

Ray Palmer

GavMan wrote: »

Precisely.

I'm highlighting the discrepancy in price in price...

I only looked at the briefly but one appears to have a double front(window on each side of the door) and gardens. That would suggest is one is larger than the other and has room to extend and park. That could make a difference of 100k

jmayo

murphaph wrote: »

Germany (at least specific regions) could said to be experiencing a bubble in prices and it's not because there's massively more lending taking place. Foreign investors see German property as a safe haven for their money in these uncertain times, thus driving up demand and with it prices.

Germany vs Ireland.
Hmmmm let me see what are the differences.

murphaph wrote: »

I think there are foreign investors buying property in Dublin at least, given the relatively good yields they can generate (it is clearly cheaper to buy now in Dublin than rent, IF you have the funding).

IF can be a mighty big word.

I don't see how you can have a proper functioning market when there are lots of people stuck, there is limited supply and there are lots of other people with no way to afford the property.
The day when ever increasing cheap credit made increasing prices achieveable and within reach of the masses is gone.

murphaph wrote: »

For markets outside the major cities and beyond the commuter belts then I agree that for prices to rise you'd need a return to hand over fist lending, which hopefully we'll never see again (but probably will).

I think we have been so badly burnt and the mess was so far reaching that short of us discovering millions of barrels of oil flowing down the road in Roscommon or the like we are screwed for a long time.

There will always be houses that will sell.
There will always be more desirable areas to live and to buy.
But the madness of our bubble aint going to be happening any time soon.
Be thankful.

Zamboni

Ray Palmer wrote: »

If you actually look back rent increases are the norm point blank. The blip was them going down. Rents will keep going up pretty much forever to at least stay inline with inflation.

If you want to talk about a stable market that is what you are talking about increasing rents. In fact what tends to happen is property close to desirable areas increase in value and then eventually become too expensive for one household and then get divided. Look at every capital city and you will see it. The brownstones in New York, Victorian houses in London and the Georgian houses in Dublin. It is the most likely think going to happen to suburban houses in Dublin over the next 50 years.

What many people don't get is the property market is a long distance endurance race not a quick sprint.

I remember lots of people going on about how they would wait for the crash and then buy. What they missed was the banks stopped lending, they lost their jobs and fear of property would paralyze them.

So now here we stand, people who were called idiots for buying and laughed at for negative equity are in their houses. Not only are they in their houses they have trackers and have been in their homes a good time ranging from 7 years to longer. People love to mention the peak but forget not that many people bought at the peak.

Mean while those who didn't buy and planned to buy after the "madness". Still live in rented property and do not have massive savings, their rent has gone up, if they can get a mortgage they are paying much more for and they are older.

So learning from the past is being missed for some people for sure but might not be the way people are commenting on.

Say you were 30 in 2004 and waited for the madness to stop. You are now 40 maybe have a kid and are trying to get a mortgage and they only give you a 25 year one. You may be much worse off than your friend who bought in 2004. They have 15 years left and pay less for their mortgage. This isn't hypothetical really as I know people who pretty much earn the same but in vastly difference financial and living conditions.

Couple of things on this.
What you have detailed here has happened. God help the folks who sat back and didn't save whilst renting - They are at the mercy of landlords possibly for the rest of their lives.

The people who were prudent and did not enter the market are being screwed by the political and banking classes - no stock on the market to purchase, reduced mortgage availability and increasing rent rates.

Our society has punished prudence and rewarded fiscal irresponsibility.
Anybody who celebrates this is clearly displaying their ethics.

Ray Palmer

Zamboni wrote: »

Couple of things on this.
What you have detailed here has happened. God help the folks who sat back and didn't save whilst renting - They are at the mercy of landlords possibly for the rest of their lives.

The people who were prudent and did not enter the market are being screwed by the political and banking classes - no stock on the market to purchase, reduced mortgage availability and increasing rent rates.

Our society has punished prudence and rewarded fiscal irresponsibility.
Anybody who celebrates this is clearly displaying their ethics.

I think you kind of missed the point I was making.

Firstly many people couldn't save as opposed to didn't bother.

The people who were "prudent" in your eyes weren't actually prudent but just gambling like everybody else. They gambled they would be able to get cheap mortgages in the future. Rent would either go down or remain the same. Not only that many laughed about negative equity and repossessions wanting people to be punished for not doing as they did because they were so much "smarter".

Calling politician and bankers a class is just ridiculous. The suggestion they got together and decided to screw over people is even more ridiculous.

If builders kept building people would have gone on about this being crazy so not sure how you expected stock to increase. The "prudent" people were part of the reason there was no demand as they waited and waited. Now the tide has turned they are complaining they missed the boat again. No difference in the intent which was greed just a different tactic. So a display of ethics is not showing anybody in a favourable light.

Generally everybody was trying to play the market and the true prudent behaviour was to buy within your means. Many people waiting were trying to get a better place than they could afford at the time when they would naturally buy by getting to a certain stage in their life.

Some people lost and gained more than others so that is that. Having dealt with people who laughed about me owning property and how they would pick up a bargain I know there was lots of gloating going on.

I am not gloating just pointing out they weren't right and they now have missed out on something they wanted. Complaining about the banks and politicians for this is a little silly as it was relatively foreseeable how they would behave. Like expected easy mortgages during a recession.

Lots of people expecting a property price crash an no recession. Not prudent thinking.

GavMan

Ray Palmer wrote: »

I only looked at the briefly but one appears to have a double front(window on each side of the door) and gardens. That would suggest is one is larger than the other and has room to extend and park. That could make a difference of 100k

375:
http://www.myhome.ie/residential/brochure/21-llewellyn-way-rathfarnham-dublin-14/2676097

268:
http://www.myhome.ie/residential/brochure/8-llewellyn-way-rathfarnham-dublin-16/2393105

Look the same to me from the front. 375 has a rear extension. Thats a bit of a stretch to ask for 107k extra.

The point is moot anyway

Ray Palmer

GavMan wrote: »

375:
http://www.myhome.ie/residential/brochure/21-llewellyn-way-rathfarnham-dublin-14/2676097

268:
http://www.myhome.ie/residential/brochure/8-llewellyn-way-rathfarnham-dublin-16/2393105

Look the same to me from the front. 375 has a rear extension. Thats a bit of a stretch to ask for 107k extra.

The point is moot anyway

These are different houses than the ones I commented on. Pretty different house when it comes to condition. One is truly walk in condition and the other isn't and looks like it was poorly maintained. Maybe 107k is a stretch but they also haven't sold yet either.

Valentine1

the previous boom was driven by aggressive loaning and the shed loads of cash poured into the country by the banks. The banks are not lending currently, certainly not in the way they did, the micro bubble forming in South Dublin is fueled by buyers and their cash, not the banks. Thats why we have not seen it extend into other counties or even the Northside. The bubble is unlikely to expand rapidly because there are not enough cash rich buyers to extend into other areas.

Ray Palmer

Valentine1 wrote: »

the previous boom was driven by aggressive loaning and the shed loads of cash poured into the country by the banks. The banks are not lending currently, certainly not in the way they did, the micro bubble forming in South Dublin is fueled by buyers and their cash, not the banks. Thats why we have not seen it extend into other counties or even the Northside. The bubble is unlikely to expand rapidly because there are not enough cash rich buyers to extend into other areas.

No the bubble was caused by a load of people coming to house buying age at the same time and they had jobs. These people can't wait forever so they are now returning to the market to either upgrade or get their first home if they missed their opportunity before.

The banks helped this but weren't the cause.

ChRoMe

Ray Palmer wrote: »

Not only are they in their houses they have trackers and have been in their homes a good time ranging from 7 years to longer. People love to mention the peak but forget not that many people bought at the peak.

Excellent posts Ray,food for thought.

This is something I've been thinking about a lot recently, as a migrant who will be returning from best part of 7 years in London.

While I gasp in horror at my friends in their negative equality homes, the fact that trackers are no longer available in this country make me question if I'll essentially be in the same (or even worse position) when I come to buy in the next year or two. Even with a decent deposit, no debts and not having to pay rent while I house hunt.