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Property Market 2016

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    #1382
    ThisRegard
    Closed Accounts Posts: 27,833 ✭✭✭✭ThisRegard


    [Deleted User] wrote: »
    To encourage new builds. (Increase in supply)

    A subtle effort at trying to subsidize new developments without Paul Murphy screaming from the rooftops about lining 'capitalist fat cats' pockets.

    Yeah, but I would have thought that homes that people bought as starters years ago and trading up from would be better within reach of first time buyers these days given the central bank restrictions


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    #1383
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,283 Mod ✭✭✭✭The_Conductor


    ThisRegard wrote: »
    Yeah, but I would have thought that homes that people bought as starters years ago and trading up from would be better within reach of first time buyers these days given the central bank restrictions

    A significant number of them- even dating back to 2000/2001 are still in negative equity first off- and secondly- there were never subsequent 'stage' developments (houses or larger apartments for families with access to facilities and amenities) built in the localities of these. Despite them not being suitable for a sizeable proportion of their current owners- with kids in schools/work etc- purely from a location perspective- its very difficult for them to actually move.

    Its a mess- from the last time round- which was never resolved then- and isn't being acknowledged now.


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    #1384
    Odin Rich Marshmallow
    Posts: 0 ✭✭✭✭ Odin Rich Marshmallow


    ThisRegard wrote: »
    Yeah, but I would have thought that homes that people bought as starters years ago and trading up from would be better within reach of first time buyers these days given the central bank restrictions

    Yes, but that's if you consider the subsidy as being towards helping "people buy a home", whereas the subtle difference is that it is really towards "helping make building more houses more attractive to developers, with the knock on effect being that increased supply ought to help".

    In the first instance, without any supply change, all the subsidy does is raise the market price. The second instance requires new supply in order to unlock the subsidy.

    It is an attempt (weakly) to encourage an increase in supply.


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    #1385
    OfflerCrocGod
    Registered Users Posts: 6,309 ✭✭✭OfflerCrocGod


    Also the original leaks mentioned that it would only apply to new houses that cost €300K or less.


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    #1386
    notkenny
    Registered Users Posts: 34 ✭notkenny


    I think there are very few new builds less than 300K in Dublin.


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    #1387
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,283 Mod ✭✭✭✭The_Conductor


    notkenny wrote: »
    I think there are very few new builds less than 300K in Dublin.

    Depends entirely on what is defined as 'Dublin'- parts of 'Adamstown' which have received the fast-track planning- are, if anyone cared to check, actually in North Kildare.

    300k there will buy you a reasonable 3 bed townhouse (with an apartment underneath). However, its also a commute of at very least an hour, often significantly more- to and from Dublin city centre.


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    #1388
    OfflerCrocGod
    Registered Users Posts: 6,309 ✭✭✭OfflerCrocGod


    notkenny wrote: »
    I think there are very few new builds less than 300K in Dublin.
    I've mentioned before that there are a few new developments in D15 some of which are selling houses below €300K. I imagine if this is confirmed in the budget you will see the developers in D15 respond (probably by cutting allowances and extras) and try and push more of their houses below that figure.


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    #1389
    asteroids over berlin
    Closed Accounts Posts: 1,115 ✭✭✭asteroids over berlin


    OfflerCrocGod wrote: »
    I've mentioned before that there are a few new developments in D15 some of which are selling houses below €300K. I imagine if this is confirmed in the budget you will see the developers in D15 respond (probably by cutting allowances and extras) and try and push more of their houses below that figure.

    Are these More so in Clonee such as Hansfield etc, nice but they arent going to appreciate


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    #1390
    OfflerCrocGod
    Registered Users Posts: 6,309 ✭✭✭OfflerCrocGod


    asteroids over berlin wrote: »
    Are these More so in Clonee such as Hansfield etc, nice but they arent going to appreciate
    Personally I wouldn't view my home as an investment.


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    #1391
    gaius c
    Registered Users Posts: 3,528 ✭✭✭gaius c


    kippy wrote: »
    Ultimately NAMA and the banks cannot return a "profit"(I use that term extremely loosely) without a rising property market.
    Banks and other institutions are sitting on vacant property at the moment waiting for prices to reach a suitable level to sell into. This is the type of behavior that should be stamped out, but it is difficult to do so when it is the state as a whole that loses of if it is.

    Yep. It's forcing the cost of the bubble onto those who didn't participate in the bubble.


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    #1392
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,283 Mod ✭✭✭✭The_Conductor


    Thats not necessarily true about NAMA- keep in mind, they didn't pay face value for *any* of those loans. The average price they paid for those loans was 57c in the Euro- falling as low as 33c in the Euro- on some particularly bad debts. The average collatoralised price their paid for debt secured on residential property- was 48c in the Euro..........

    When you've got stuff for half market value- you'd have to be the most inept person in the world not to be able to turn a massive profit on it.

    NAMA has been more interested in its Irish commercial properties- than the smathering of residential developments it has around the country (any of which were easy to shift- have already been done so). And also- keep in mind- proportionally fewer of its loans were collatoralised on residential property in this jurisdiction- than in Northern Ireland and the England in particular (NAMA had a greater value of residential property in the greater London area- than in Ireland as a whole)- this is something that people seem to overlook the whole time........

    NAMA are a rather convenient scapegoat- sure, they've bolloxed up many things- however, the Irish residential property market- thats the politicians, plain and simple.


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    #1393
    Odin Rich Marshmallow
    Posts: 0 ✭✭✭✭ Odin Rich Marshmallow


    The_Conductor wrote: »
    Thats not necessarily true about NAMA- keep in mind, they didn't pay face value for *any* of those loans. The average price they paid for those loans was 57c in the Euro- falling as low as 33c in the Euro- on some particularly bad debts. The average collatoralised price their paid for debt secured on residential property- was 48c in the Euro..........

    When you've got stuff for half market value- you'd have to be the most inept person in the world not to be able to turn a massive profit on it.

    NAMA has been more interested in its Irish commercial properties- than the smathering of residential developments it has around the country (any of which were easy to shift- have already been done so). And also- keep in mind- proportionally fewer of its loans were collatoralised on residential property in this jurisdiction- than in Northern Ireland and the England in particular (NAMA had a greater value of residential property in the greater London area- than in Ireland as a whole)- this is something that people seem to overlook the whole time........

    NAMA are a rather convenient scapegoat- sure, they've bolloxed up many things- however, the Irish residential property market- thats the politicians, plain and simple.

    NAMA didn't buy anything at nearly half market value!

    They might well have bought loans at half par value, but these given the enormous fall in the market prices are vastly, vastly different figures and conflating them is terribly unwise.

    Nama's par discount doesn't in any way whatsoever give them any right to make a profit when they go to sell on the distressed loans or indeed the assets that back them.

    A loan that A took out for €100mn to buy a property in 2007 (of market value at the time of €120mn) might well have been sold to NAMA for €48mn due to the fact that the loan's value is compromised and so is the asset's value.

    The problem is that the par discount is an over-exaggeration in most cases as the most distressed (and so indeed most likely Nama'd) loans and properties were based on a hugely inflated property market and unrealistic asset prices.

    This idea that Nama's job was a piece of piss and you'd have to be 'the most inept person in the world' to not turn a massive profit is nonsense.


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    #1394
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,283 Mod ✭✭✭✭The_Conductor


    Deleted User wrote: »
    This idea that Nama's job was a piece of piss and you'd have to be 'the most inept person in the world' to not turn a massive profit is nonsense.

    I think we're not going to agree on this- and will instead have to agree to disagree.......

    A significant majority of the loans which were transferred to NAMA were not impaired- and were subsequently sold on (primarily to institutional investors) at staggering profits- however, arguably- very much below their open market values.

    Part of NAMAs legacy- is politicians are using them as a whipping boy to deflect from the shortcomings of government in the housing sector (wholly aside from the current mess they've found themselves in).

    NAMA are trumpetting the fact that the exchequer is going to get back all the money that was ploughed into NAMA- when a far more laudable goal- would be to get the money the exchequer ploughed into the banking sector, as a whole, repaid. Instead- when the dust finally settles, probably around 2030 at this rate- we'll be between 42 and 45 billion out of pocket- and that at a time when our pensions time bomb will finally have blown up.........

    I'm sorry that I don't have the same high regard for NAMA that some people have- or indeed our politicians (as a whole), our bankers- or the broken client based system that this country seems incapable of shaking. Once upon a time I thought all these things would change in time- now, perhaps I'm becomming more of a realist- or perhaps I'm just getting more and more cynical, I don't know.........


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    #1395
    Odin Rich Marshmallow
    Posts: 0 ✭✭✭✭ Odin Rich Marshmallow


    The_Conductor wrote: »
    I think we're not going to agree on this- and will instead have to agree to disagree.......

    A significant majority of the loans which were transferred to NAMA were not impaired- and were subsequently sold on (primarily to institutional investors) at staggering profits- however, arguably- very much below their open market values.

    Part of NAMAs legacy- is politicians are using them as a whipping boy to deflect from the shortcomings of government in the housing sector (wholly aside from the current mess they've found themselves in).

    NAMA are trumpetting the fact that the exchequer is going to get back all the money that was ploughed into NAMA- when a far more laudable goal- would be to get the money the exchequer ploughed into the banking sector, as a whole, repaid. Instead- when the dust finally settles, probably around 2030 at this rate- we'll be between 42 and 45 billion out of pocket- and that at a time when our pensions time bomb will finally have blown up.........

    I'm sorry that I don't have the same high regard for NAMA that some people have- or indeed our politicians (as a whole), our bankers- or the broken client based system that this country seems incapable of shaking. Once upon a time I thought all these things would change in time- now, perhaps I'm becomming more of a realist- or perhaps I'm just getting more and more cynical, I don't know.........

    That's a ridiculous assertion. Evidence for it please?

    Consider this simple question which shows a problem with the idea that this was probable, let alone prevalent, let alone made up 'a significant majority' of the loans.

    Why would any bank sell loans to NAMA at a lesser price than they could achieve on the open market for them?


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    #1396
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,283 Mod ✭✭✭✭The_Conductor


    Time will tell- and it looks like we will all be a little wiser in due course.......
    We've already had various stories in the media (such as the Zoe Developments saga)- more will follow in due course.

    The other issue in all of this- is the manner in which the term open market value- became commingled with 'long term economic value' as a manner of explaining purely spurious valuations put on both loans and collatoral stumped up in support of loans...........

    The happenings of 2009 will reverberate for a long time to come.


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    #1397
    Odin Rich Marshmallow
    Posts: 0 ✭✭✭✭ Odin Rich Marshmallow


    The_Conductor wrote: »
    Time will tell- and it looks like we will all be a little wiser in due course.......
    We've already had various stories in the media (such as the Zoe Developments saga)- more will follow in due course.

    The other issue in all of this- is the manner in which the term open market value- became commingled with 'long term economic value' as a manner of explaining purely spurious valuations put on both loans and collatoral stumped up in support of loans...........

    The happenings of 2009 will reverberate for a long time to come.

    I see zero citations here to support your initial assertion.

    You appear not to have attempted the question either.


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    #1398
    dubrov
    Registered Users Posts: 3,560 ✭✭✭dubrov


    The biggest problem with nama is that it bought a load of assets well above market value at the time.

    The goal was to set a floor on the property market nit to make a profit.

    I think the whole ideology is flawed.


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    #1399
    riclad
    Registered Users Posts: 8,184 ✭✭✭riclad


    Say a house had a loan value of 100k, nama got it for 60k.
    It got a discount of about 40 per cent of the loan on the property.
    Prices in dublin are rising ,
    i know someone who bought 2 apartments in a rural area .
    both 150k, in 2005.
    those apartments are now worth 75 k.
    Nama cant wait 10 years for prices to rise in rural area s.
    The chances are a house in cavan will never be worth 200k.
    Maybe they,ll wait a few years for prices to rise in dublin.
    Nama owns propertys which are rented out .
    The point of nama was to stabilise the banks ,
    theres no way the irish economy could recover if the banks
    were not kept going.
    like a mobile network cannot work without cell towers in every area .
    Some houses in rural area ,s went down in value by 70 per cent ,
    so of course they cant make a profit on everything.
    Buildings have to be maintained even when empty.
    Nama owns apartment blocks which were half finished ,
    no walls or ceilings inside,no plumbing done or floors put down.
    THE Crash happened quickly,
    builders left building sites with houses half built .

    Blaming nama for everything lets stupid greedy bankers and civil servants
    off the hook.
    Nama was designed to put a line under the banks debts and
    stabilise them and allow them to continue in business .


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    #1400
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,283 Mod ✭✭✭✭The_Conductor


    dubrov wrote: »
    The goal was to set a floor on the property market nit to make a profit.

    The goal was to try and maintain the banks tier 1 capitalisation levels insofar as was possible- if they were forced to crystalise losses- it would destroy their capitalisations- and force them to raise new funding- when the market was toxic to any funding attempts. This was when it was still (2009) anticipated that they would be able to stand on their own two feet (which obviously was complete and utter wishful thinking).


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    #1401
    gaius c
    Registered Users Posts: 3,528 ✭✭✭gaius c


    The_Conductor wrote: »

    NAMA are trumpetting the fact that the exchequer is going to get back all the money that was ploughed into NAMA- when a far more laudable goal- would be to get the money the exchequer ploughed into the banking sector, as a whole, repaid. Instead- when the dust finally settles, probably around 2030 at this rate- we'll be between 42 and 45 billion out of pocket- and that at a time when our pensions time bomb will finally have blown up.........

    Can't agree with that. NAMA operates by subverting normal capitalism and preventing firesales. By doing that they force future buyers to pay well over what they would have by rationing supply to the market.

    It's market manipulation on a massive scale because the price anchoring affects all levels of the market.

    At a basic level, if we try to recover the monies list by the banks, that will be coming (one way or another) from the pockets of those who did not participate in the original bubble. This should not be the taxpayer's problem and it all goes back to the disastrous haste to guarantee EVERYTHING!


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    #1402
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,283 Mod ✭✭✭✭The_Conductor


    It most certainly should not be the taxpayers issue- the ideal manner of dealing with it- would have been to burn the holders of subordinated debt in the institutions- however, that boat sailed.

    We're left with a bad situation- and we're not even making the most of a bad situation- we're sort of muddling our way as we go along- not for better or worse- for worse mostly.

    100% definitely- the Irish taxpayers should not be lumbered with paying for all of this- however, our politicians don't appear to be answerable to anyone- we've ended up with a government that no-one voted for- seems they will find some manner of subverting the will of the people, regardless of what we do.


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    #1403
    riclad
    Registered Users Posts: 8,184 ✭✭✭riclad


    Nama was needed to stabilized the banks,
    the government owns most of the banks,
    So some sudden firesale would have increased the cost to tax payers .
    We will see whether the government plan is carried out,
    ie build 50 thousand houses over the next few years .
    Is this a practical plan, can they afford to do this in the next 5 years .
    We,ll have to wait and see.
    The government could have refused to take over anglo as it was run in a reckless manner ,
    eg it ran a scheme to increase its share price .
    By lending money to people to buy anglo shares .


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    #1404
    Rew
    Moderators, Sports Moderators Posts: 8,679 Mod ✭✭✭✭Rew


    Revised CSO stats is out...

    http://cso.ie/en/releasesandpublications/ep/p-rppi/rppi16/


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    #1405
    OfflerCrocGod
    Registered Users Posts: 6,309 ✭✭✭OfflerCrocGod


    Rew wrote: »
    Revised CSO stats is out...

    http://cso.ie/en/releasesandpublications/ep/p-rppi/rppi16/
    Article on the figures http://www.rte.ie/news/business/2016/0921/818092-cso-house-prices/


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    #1406
    Bob24
    Registered Users Posts: 10,905 ✭✭✭✭Bob24


    OfflerCrocGod wrote: »
    Article on the figures http://www.rte.ie/news/business/2016/0921/818092-cso-house-prices/

    MyHome pretty much has the same content worded slightly differently: http://blog.myhome.ie/2016/09/21/collapse-property-prices-crash-worse-first-thought-says-cso/

    Tough job to be a journalist nowadays: wait for a government agency to produce a report and paraphrase the conclusion ;-)


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    #1407
    Rew
    Moderators, Sports Moderators Posts: 8,679 Mod ✭✭✭✭Rew


    Bob24 wrote: »
    Tough job to be a journalist nowadays: wait for a government agency to produce a report and paraphrase the conclusion ;-)
    Nothing new unfortunately


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    #1408
    gaius c
    Registered Users Posts: 3,528 ✭✭✭gaius c


    The_Conductor wrote: »
    It most certainly should not be the taxpayers issue- the ideal manner of dealing with it- would have been to burn the holders of subordinated debt in the institutions- however, that boat sailed.

    We're left with a bad situation- and we're not even making the most of a bad situation- we're sort of muddling our way as we go along- not for better or worse- for worse mostly.

    100% definitely- the Irish taxpayers should not be lumbered with paying for all of this- however, our politicians don't appear to be answerable to anyone- we've ended up with a government that no-one voted for- seems they will find some manner of subverting the will of the people, regardless of what we do.

    But now that this money "has" to be recovered, the only way it can be done is by extracting it from people careful enough to avoid the original bubble.

    The state can stay insolvent longer than you can remain rational!


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    #1409
    Sleepy
    Registered Users Posts: 24,196 ✭✭✭✭Sleepy


    Bob24 wrote: »
    MyHome pretty much has the same content worded slightly differently: http://blog.myhome.ie/2016/09/21/collapse-property-prices-crash-worse-first-thought-says-cso/

    Tough job to be a journalist nowadays: wait for a government agency to produce a report and paraphrase the conclusion ;-)
    Yup, I read the report yesterday and thought I'd see what the Times' take on it was only to discover that most of the article is lifted straight from the report.


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    #1410
    riclad
    Registered Users Posts: 8,184 ✭✭✭riclad


    Many people just read one paper ,so i see no harm in a paper reporting on a government report if it has news thats important or gives info
    on house price trends .
    Like the annual budget is widely reported in every paper .
    Most people do not read government reports ,
    they read the coverage in newspapers .


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    #1411
    Sleepy
    Registered Users Posts: 24,196 ✭✭✭✭Sleepy


    True, but it would be nice to see some more thorough interpretation of the report included rather than just re-printing the introduction...


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