Depressing Dublin House prices

barks1990

I was trying to save up for a mortgage and when i finally got the mortgage approved, deposit together etc.The prices have now gone up to ridiculous levels what do you people reckon sit back and see what happens or try get something now as they may rise even higher than 20% by this time next year(so im told).

Any advice and are any of you in the same boat?

regards

jd1983

barks1990 wrote: »

I was trying to save up for a mortgage and when i finally got the mortgage approved, deposit together etc.The prices have now gone up to ridiculous levels what do you people reckon sit back and see what happens or try get something now as they may rise even higher than 20% by this time next year(so im told).

Any advice and are any of you in the same boat?

regards

If you reckon 20% rises will happen, then I'd hold off. 20% rises in just one year is definitely bubble territory and therefore going by historical trends worldwide the bubble will definitely pop, POP!!!

Muahahaha

There was an article in todays Sindo predicting "up to" 30% increases in property prices in 2014. They didn't for one minute mention that a 30% increase is severe bubble territory but it is, in which case you'd be better off not getting involved and waiting for it to pop

Mrs OBumble

A buyer who does not have to wait for a previous property to sell is in the best position ever.

So - you keep looking, but over a long time. There are some good prices to be had, just not many, so you cannot assume they will be on the market at the time you are looking.


Also, consider again what features you would be willing to compromise on, and keep an open mind.

Years ago, I thought I was looking for a 3brm standalone house, complete with back lawn and fence. Ended up with a 3brm unit in a townhouse complex, with almost no section at all. But it ticked all my other boxes, was cheaper than I'd expected to pay, and rents out really really well.

Barely Hedged

jd1983 wrote: »

If you reckon 20% rises will happen, then I'd hold off. 20% rises in just one year is definitely bubble territory and therefore going by historical trends worldwide the bubble will definitely pop, POP!!!

20% relative to what?

House valued at €450k in 2007 rises 20%. Absolute increase = €140k

Same house valued at €200k in 2013 rises 20%. Absolute increase = €40k

moxin

As always when deciphering from the media hype, each area is different. Some prices have gone up, some have not at all in other areas. You'll know in your particular area by watching the market to make a decision.

lima

Check out sites such as daftdrop and you will see there are still many many houses (the majority) going down in value.

Careful reading on this site, there are some people who are in negative equity who believe the current price rise is a natural cause and that prices are going to rise forever.

I've been holding out for 1.5 years now, but I have a nice place that I am renting. I reckon at the very best, prices are stabilizing and now would be a good time to buy, but the severe lack of stock in Dublin means that there is almost nothing to chose from.

Also Repossessions will increase in 2014 thank god, so this will add some stock to the market also.

spaceHopper

I am so happy I didn't buy during the boom and I came under a lot of presure from my father to buy with offers of help... I felt bad that everybody else had bought and I hadn't. In the end meet a girl, got married... and bought last year.

I'm happy to be not looking now but if I were you I'd follow my instinst. The papers had it wrong before and have vested interest in talking up the maket it sell paper and advertising. We had it will never end then well maybe a soft landing and in the end bottom called at the start of every selling season, three times a year.

It's very hard to call the market in Dublin right now as there is no supply so that is driving prices - if that changes and banks stop holding on to houses then I'd expect prices to drop just as fast as they went up.

I you think prices will keep rising then buy now - if not hold of. But I'd keep looking you never know what you'll find. Remember you have to live somewhere and only make a loss when you sell. Do the maths on how much it would cost you to own v rent, if you plan on staying there 10+ years and not need to move for work then the own v rent equation is all that matters.

Also unless it's been renovated there is no such thing as a 30 year old house you can move into, you will always end up doing work.

jd1983

Barely Hedged wrote: »

20% relative to what?

House valued at €450k in 2007 rises 20%. Absolute increase = €140k

Same house valued at €200k in 2013 rises 20%. Absolute increase = €40k

FYI, 20% of 450k is 90k.

The OP was speaking in fairly general terms and therefore so was i. 20% average annual rises is not sustainable. Map this trend out over 5 yrs and see what happens to prices.

Barely Hedged

jd1983 wrote: »

FYI, 20% of 450k is 90k.

The OP was speaking in fairly general terms and therefore so was i. 20% average annual rises is not sustainable. Map this trend out over 5 yrs and see what happens to prices.

My apologies - was doing two things at once and put the wrong number down.

My opinion is that, I dont think prices will rise at 20% for 5 years. There will be a large percentage jump from a low base and then it will be fairly flat. I think this is due to so many people waiting for obvious signs that the bottom was reached and are now racing to get somewhere. This will ease in a year or two.

In response to the original poster, i think youre never going to see prices as cheap again. Yes, the prices may have jumped from what you were looking at a year or two ago but that was from a very low point and whats 20% of a low price in the grand scheme of things i.e. a 20 year mortgage.

Id get pro-actively looking in the new year

gaius c

Barely Hedged wrote: »

My apologies - was doing two things at once and put the wrong number down.

My opinion is that, I dont think prices will rise at 20% for 5 years. There will be a large percentage jump from a low base and then it will be fairly flat. I think this is due to so many people waiting for obvious signs that the bottom was reached and are now racing to get somewhere. This will ease in a year or two.

In response to the original poster, i think youre never going to see prices as cheap again. Yes, the prices may have jumped from what you were looking at a year or two ago but that was from a very low point and whats 20% of a low price in the grand scheme of things i.e. a 20 year mortgage.

Id get pro-actively looking in the new year

Dublin was cheap?
Seriously?

shamrock2004

Same here. Was approved for a mortgage. Had the deposit saved too. Bank manager wasn't too concerned by the deposit as said bank is lending up to 92%. The problem however is that what they will lend me won't get me a house, perhaps an apartment but I wouldn't buy an apartment. So, i'm stuck renting for the time being. I have a good secure job also, however I'm still of the opinion that the banks are still reluctant to lend. I'll wait for another yet anyway and see what happens.

Barely Hedged

gaius c wrote: »

Dublin was cheap?
Seriously?

Yes. Price drops of 60% - 70%, from admittedly high points, but large drops none-the-less

moxin

shamrock2004 wrote: »

Same here. Was approved for a mortgage. Had the deposit saved too. Bank manager wasn't too concerned by the deposit as said bank is lending up to 92%. The problem however is that what they will lend me won't get me a house, perhaps an apartment but I wouldn't buy an apartment. So, i'm stuck renting for the time being. I have a good secure job also, however I'm still of the opinion that the banks are still reluctant to lend. I'll wait for another yet anyway and see what happens.

Which fits precisely with the fact that alot of sales are cash buyers and the banks did row back on the salary multiples for lending back around August\Sept. This will hit the market eventually as provisional mortgage approvals that were approved pre-August will run out and have to be renewed at the new mortgage lending levels.

shamrock2004

moxin wrote: »

Which fits precisely with the fact that alot of sales are cash buyers and the banks did row back on the salary multiples for lending back around August\Sept. This will hit the market eventually as provisional mortgage approvals that were approved pre-August will run out and have to be renewed at the new mortgage lending levels.

Spot on. It all came down to salary and ability to repay, yet the rent I pay at the moment is considerably more than the anticipated monthly repayments of the mortgage I was approved for. When do you think this will hit the market?

moxin

Problem with rents is that there are many in the same boat as yourself hence keeping a bit of demand there. If you're asking about interest rates, we rely on the ECB to jack them up, it will be a long while yet for that. At present there is a mini-rush(like last year) to complete sales due to the LPT exemption running out. Together with the new mortgage approval levels very low(as described) and the rate of Dublin price increases having fallen every month since Sept, it looks like the market will be dead for vendors in Jan.

spaceHopper

CSO figures out to day show the maket cooling a bit, could be time of year and all that but 46% of sales are cash that has to dry up sooner or later.

The Spider

gaius c wrote: »

Dublin was cheap?
Seriously?

Plenty of houses in Dublin that are below 150'000 for a 3 bed.

http://www.daft.ie/searchsale.daft?s%5Bcc_id%5D=ct1&s%5Ba_id%5D=&s%5Bmnp%5D=&s%5Bmxp%5D=150000&s%5Bmnb%5D=3&s%5Bmxb%5D=&s%5Bmna%5D=&s%5Bmxa%5D=&s%5Bpt_id%5D=1&search=1&s%5Bsearch_type%5D=sale&s%5Brefreshmap%5D=1&search_type=sale

In fact there's a fair few houses that are sub 100,000, cheap for a capital city by any rate.

handlemaster

The spider there are quiet a few on that list alright. I see Dublin continuing to move up next year maybe up same as this year 15%. People on here seem to this repossessions are going to drop on the market all together and will bring prices overall down. Reposessions won't all come together at once never mind the same county. Also house building stopped 5 years ago. The banks will eventually start lending when more confidence comes that will drive prices also.

gaius c

Barely Hedged wrote: »

Yes. Price drops of 60% - 70%, from admittedly high points, but large drops none-the-less

You mean they were cheap compared to bubble-era prices?

I don't think that's what Barely Hedged was saying. He said they were cheap point blank. I asked him when.

A bottle of whiskey priced at €1000 is not cheap. When it drops to €300, it's still not cheap.

Barely Hedged

gaius c wrote: »

You mean they were cheap compared to bubble-era prices?

I don't think that's what Barely Hedged was saying. He said they were cheap point blank. I asked him when.

A bottle of whiskey priced at €1000 is not cheap. When it drops to €300, it's still not cheap.

Yes, cheap compared to bubble era prices.

You asked me when in your response? Dont see that.

Well that depends on how much youre willing to pay for a bottle of whiskey. I dont get what the link is here as its not directly comparable

spaceHopper

Here is the head line to monitor http://www.rte.ie/news/business/2013/1223/494499-mortgage-approvals/ less people are looking for mortgages, ok they are looking from more in line with rises in dublin but still less are willing to buy.

lufties

spaceHopper wrote: »

I am so happy I didn't buy during the boom and I came under a lot of presure from my father to buy with offers of help... I felt bad that everybody else had bought and I hadn't. In the end meet a girl, got married... and bought last year.

I'm happy to be not looking now but if I were you I'd follow my instinst. The papers had it wrong before and have vested interest in talking up the maket it sell paper and advertising. We had it will never end then well maybe a soft landing and in the end bottom called at the start of every selling season, three times a year.

It's very hard to call the market in Dublin right now as there is no supply so that is driving prices - if that changes and banks stop holding on to houses then I'd expect prices to drop just as fast as they went up.

I you think prices will keep rising then buy now - if not hold of. But I'd keep looking you never know what you'll find. Remember you have to live somewhere and only make a loss when you sell. Do the maths on how much it would cost you to own v rent, if you plan on staying there 10+ years and not need to move for work then the own v rent equation is all that matters.

Also unless it's been renovated there is no such thing as a 30 year old house you can move into, you will always end up doing work.

I was advised to buy in 2008 by a co-worker, thank fook I didn't, I kinda regret not buying in 2011 though when prices in south dublin had probably bottomed out.

As for for that rag the independent, I absolutely despise it, pure propaganda and the meeja manipulating the public. Its like history repeating itself.

lima

handlemaster wrote: »

The spider there are quiet a few on that list alright. I see Dublin continuing to move up next year maybe up same as this year 15%. People on here seem to this repossessions are going to drop on the market all together and will bring prices overall down. Reposessions won't all come together at once never mind the same county. Also house building stopped 5 years ago. The banks will eventually start lending when more confidence comes that will drive prices also.

Keep thinking that lads, the recent rises are declining. The mini-boom is decreasing, despite what you and the Independent try to push!

The Spider

lima wrote: »

Keep thinking that lads, the recent rises are declining. The mini-boom is decreasing, despite what you and the Independent try to push!

Yes, you missed the latest meeting of the VI's where we sat around drinking brandy and smoking fine cigars wondering how we could inflate the property market to stratospheric heights.

Facts are facts, limited supply, no building, increased demand = rising prices for both rents and houses in desirable areas.

However I did point out that there's still a substantial amount of houses in Dublin sub 150,000, which are reasonable prices.

jd1983

Barely Hedged wrote: »

My apologies - was doing two things at once and put the wrong number down.

My opinion is that, I dont think prices will rise at 20% for 5 years. There will be a large percentage jump from a low base and then it will be fairly flat. I think this is due to so many people waiting for obvious signs that the bottom was reached and are now racing to get somewhere. This will ease in a year or two.

In response to the original poster, i think youre never going to see prices as cheap again. Yes, the prices may have jumped from what you were looking at a year or two ago but that was from a very low point and whats 20% of a low price in the grand scheme of things i.e. a 20 year mortgage.

Id get pro-actively looking in the new year

Ok, so the mythical "soft landing" will in fact happen this time?

In Dublin prices rose by 15%, if they rise by 20% next year then that's a rise of > 35% in just two years. To me that sounds like a mini bubble and by definition bubbles pop.

If prices do level off then the OP could then buy in a more stable market in a few years time safe in the knowledge that prices won't fluctuate much. However if they buy now in this cash fuelled market then they have the worry that prices might plummet when cash reserves dry up.

What you're advocating is panic buying and in my experience that never ends well.

Barely Hedged

lima wrote: »

Keep thinking that lads, the recent rises are declining. The mini-boom is decreasing, despite what you and the Independent try to push!

I would say next year, places where price rises have occurred this year will see growth of between 5% and 10%.

I see the lack of supply in these areas as one of the main reasons for it.

What sort of an increase/decrease do you think will happen next year in these areas and why?

moxin

The Spider wrote: »

However I did point out that there's still a substantial amount of houses in Dublin sub 150,000, which are reasonable prices.

Some of them are in anti-social behaviour hotspots aka dodgeville, bet you wouldn't live there. Stop trying to pass those houses off as "liveable", its a tiresome effort at deflection.

Barely Hedged

jd1983 wrote: »

Ok, so the mythical "soft landing" will in fact happen this time?

In Dublin prices rose by 15%, if they rise by 20% next year then that's a rise of > 35% in just two years. To me that sounds like a mini bubble and by definition bubbles pop.

If prices do level off then the OP could then buy in a more stable market in a few years time safe in the knowledge that prices won't fluctuate much. However if they buy now in this cash fuelled market then they have the worry that prices might plummet when cash reserves dry up.

What you're advocating is panic buying and in my experience that never ends well.

Im not advocating panic buying. Taken in context, prices have fallen quite considerably. They realistically cant fall any further that would result in a bad investment decision for the original poster if you consider a time horizon of 20 years and him/her buying tomorrow.

Sometimes you need to s**t or get off the pot and now i believe is a good time to s**t. Large price drops will not happen again in the areas described by the original poster.

The cash reserves drying up assumption seems to be based on the belief that the cash buyers are Irish based only.

The Spider

moxin wrote: »

Some of them are in anti-social behaviour hotspots aka dodgeville, bet you wouldn't live there. Stop trying to pass those houses off as "liveable", its a tiresome effort at deflection.

Not really, if you can't afford to buy in the more desirable parts of the city (SCD) then that's what you're left with, you may see these areas as places that you should be able to buy, but if your salary isn't up to it or your savings then, you have to look to other areas or outside.

It isn't deflection, I wish people would say what they mean, they say house prices are too expensive in Dublin, not true what they really mean is "I want a house in the most exclusive part of the country but I want it cheap."

The reason it's expensive is because it's exclusive, if it was cheap then you'd have the associated problems that you get with Tallaght etc.

Anyway some of those areas in the sub 150,000 category were considered decent areas in the boom, when everyone was buying way outside Dublin.

lima

Barely Hedged wrote: »

I would say next year, places where price rises have occurred this year will see growth of between 5% and 10%.

I see the lack of supply in these areas as one of the main reasons for it.

What sort of an increase/decrease do you think will happen next year in these areas and why?

Perhaps some people will come to a realization that south dublin is completely overpriced and they will decide to live elsewhere in Dublin where there is lots of supply.

Also, the people who have been able to get mortgages and who likely have very large deposits of 200+k will have gotten their mortgages and have bought their houses. This will bring down the amount of people looking for mortgages. Very few people in their 20's will have large deposits and will struggle to get finance.

Also, regarding inevitable repossessions and whether they will have an impact on Dublin prices, an entire bank has decided not to offer mortgage products here because of its worry about lack of repossessions. This point to a private company making an informed decision and lends weight to the idea of possible price decreases, despite what journal.ie and irish independent try to push.