Property Market 2018

Bob24

FixdePitchmark wrote: »

7% increase is still high

Of course the % is going to drop at some point.

But they are already mad high - 7 % on a high figure is still serious money.

And I've said it a few times but people need to remember that in absolute terms 7% increase today would be more than 10% a few years ago, as we are taking 7% of a much larger figure.

Henbabani

Bob24 wrote: »

And I've said it a few times but people need to remember that in absolute terms 7% increase today would be more than 10% a few days ago, as we are taking 7% of a much larger figure.

but from what i read, the first half of the year is always the strongest, so if we finish the first half on 7% maybe we can see an yearly increase of 3-4%.

Bob24

Henbabani wrote: »

but from what i read, the first half of the year is always the strongest, so if we finish the first half on 7% maybe we can see an yearly increase of 3-4%.

That would be a significant cool down then (but April-June and September-October are usually good period for sales and closed sales for those periods haven’t yet been included in the stats)

We’ll have to what and see what the RPPI says. More stagnations or drops in May/June and I’ll become more bearish as these will include sales for traditionally good monthes.

Henbabani

https://cso.ie/en/releasesandpublications/ep/p-rppi/residentialpropertypriceindexmay2018/

Still high, BUT finally start to moderate.

Bob24

Henbabani wrote: »

https://cso.ie/en/releasesandpublications/ep/p-rppi/residentialpropertypriceindexmay2018/

Still high, BUT finally start to moderate.

I assume you’re only looking at Dublin where there is an increase between April and May but it is lower that the one in 2017?

It is hard to see on my phone but the rest of the country doesn’t seem to show signs of moderation? (April to May increase is stronger this year than last year if i read it correctly)

Eric Cartman

https://www.broadsheet.ie/2018/07/20/property-prices-latest/

SO apparently now everyone in Dublin is out of negative equity, the 2007 boom pricing has returned to the capitol , so this is where it gets interesting.

I myself know of a few and there are estate agents also sitting with lists of people to call when the prices equalise and owners particularly of BTL properties have been waiting till they got 'their' money back and sell up with no debt.

I would expect to see a lot of overpriced Dublin property (particularly 06/07 new builds) hitting the market very shortly and an even larger contraction of rental properties in the city.

awec

Eric Cartman wrote: »

https://www.broadsheet.ie/2018/07/20/property-prices-latest/

SO apparently now everyone in Dublin is out of negative equity, the 2007 boom pricing has returned to the capitol , so this is where it gets interesting.

I myself know of a few and there are estate agents also sitting with lists of people to call when the prices equalise and owners particularly of BTL properties have been waiting till they got 'their' money back and sell up with no debt.

I would expect to see a lot of overpriced Dublin property (particularly 06/07 new builds) hitting the market very shortly and an even larger contraction of rental properties in the city.

I think this has been happening quite a bit already and is at least partly responsible for the reduction in the number of properties available for rent over the past 5 odd years.

Once people get out of negative equity they want to offload as quickly as possible so they can forget all about it and get on with their lives.

The_Conductor

Eric Cartman wrote: »

SO apparently now everyone in Dublin is out of negative equity, the 2007 boom pricing has returned to the capitol , so this is where it gets interesting.

Its only the freehold houses that are in positive territory- apartments are still at between 85-90% of peak prices, but almost without exception at least 10% below peak prices.

The lions share of property bought in the Dublin market since 1995 was apartments- approx 26% of units (according to the IAVI) were houses.

Yes- there will be further BTL properties hitting the market- however- if you extrapolate from RTB and CSO figures- approx 40-50k units were released to owner occupiers since 2012 by BTL investors (predominantly owners of 1-2 units, with a few high profile large investors getting out too- much to the chagrin of sitting tenants).

I'm not sure you'll see a rush of landlords heading to the door- primarily because they've been heading to the door esp. over the last 18 months- locking in capital appreciation- letting property is not worth the risk it entails (and indeed- increasingly- sitting on property that is increasing in value @ 7-8% per annum- is preferable, to putting a risky tenant in it).

Our property market is getting more and more dysfuntional.

theboringfox

awec wrote: »

I think this has been happening quite a bit already and is at least partly responsible for the reduction in the number of properties available for rent over the past 5 odd years.

Once people get out of negative equity they want to offload as quickly as possible so they can forget all about it and get on with their lives.

I don't think that's right. Base year is 2005 which was not peak of market. So I think this comment on the site is wrong. Open to correction. I'd say we are not far off negative equity being gone in Dublin.

EvolvedApe

Has the property market crashed yet?, hurry up already.

The_Conductor

theboringfox wrote: »

I don't think that's right. Base year is 2005 which was not peak of market. So I think this comment on the site is wrong. Open to correction. I'd say we are not far off negative equity being gone in Dublin.

Baseline of 100 in Jan 2005
Peak of 136.7 in Feb 2007 (in Dublin)
Current (May 2018) 104.6 (in Dublin)

These are *house* prices (not apartment prices)
We are 104.6% of the base 100 price established in Jan 2005- we are still almost 30% below Feb 2007 prices (for houses in Dublin).
House prices- have recovered significantly more quickly on a percentile basis- than have apartment prices- and Dublin prices have increased more quickly than have national prices.

So- yup- the fact that the baseline was Jan 2005- and the peak (according to the CSO) was in Feb 2007- means we have quite some way to go to exit negative equity for anyone who bought between Jan 2005 and Feb 2007 (the peak) and it was a further two years later (Feb 2009) when the baseline, established in Jan 2005, was passed on the way down again............

The article is wrong- plain and simple- and the author of the article- either got confused with the statistics- or didn't realise that the baseline was Jan 2005- or just plain didn't understand what they were looking at- one way or the other- they're factually incorrect on several different grounds.

Figure 1.1 in the attached details this in a simple to understand format (from the CSO)

Peak equalling prices aren't required to be out if negative equity....its current "value" compared to what's owed on it I would have thought.

The_Conductor

Augeo wrote: »

Peak equalling prices aren't required to be out if negative equity....its current "value" compared to what's owed on it I would have thought.

True- however, in the context of where a lot of buy-to-let properties were bought on interest only repayment plans- which are now terminating and thus have little/no capital repaid on them- the current 'value' of the property and whether or not its in negative equity (or not) is, for a large proportion of (secondhand) properties hitting the market - pertinent.

Bob24

theboringfox wrote: »

I don't think that's right. Base year is 2005 which was not peak of market. So I think this comment on the site is wrong. Open to correction. I'd say we are not far off negative equity being gone in Dublin.

You’re correct. The person writing this mistakenly assumed that 100 is the peak value.

awec

The_Conductor wrote: »

True- however, in the context of where a lot of buy-to-let properties were bought on interest only repayment plans- which are now terminating and thus have little/no capital repaid on them- the current 'value' of the property and whether or not its in negative equity (or not) is, for a large proportion of (secondhand) properties hitting the market - pertinent.

That's buy to let though, no?

My comment was more aimed toward accidental landlords.

The_Conductor

awec wrote: »

That's buy to let though, no?

My comment was more aimed toward accidental landlords.

Yes- however, the point I was making is that a disproportionate percentage of secondhand property hitting the market (in particular in the Dublin area- but also elsewhere)- is BTL properties that landlords are offloading- as they abandon the sector.

Talk to IAVI representatives (Barry McDonald or any of the guys) and see what the estate agents are encountering on the ground (they'll tell you a lot on an informal basis if you're not a journalist and they're not going to be quoted).........

There are a shedload of landlords getting the hell out of the sector- and the exodus is still speeding up, two years later. With the latest proposed amendments to the Residential Tenancies Act- the exodus is only going to speed up...........

awec

The_Conductor wrote: »

Yes- however, the point I was making is that a disproportionate percentage of secondhand property hitting the market (in particular in the Dublin area- but also elsewhere)- is BTL properties that landlords are offloading- as they abandon the sector.

Talk to IAVI representatives (Barry McDonald or any of the guys) and see what the estate agents are encountering on the ground (they'll tell you a lot on an informal basis if you're not a journalist and they're not going to be quoted).........

There are a shedload of landlords getting the hell out of the sector- and the exodus is still speeding up, two years later. With the latest proposed amendments to the Residential Tenancies Act- the exodus is only going to speed up...........

I am not sold that it is such a terrible thing given the demand for properties to buy.



There are a lot of people in Dublin sitting on mortgage approval, who are currently renting, but are struggling to find a property.

The Student

awec wrote: »

I am not sold that it is such a terrible thing given the demand for properties to buy.



There are a lot of people in Dublin sitting on mortgage approval, who are currently renting, but are struggling to find a property.

Yeah but if the property was a rental then the available bed spaces for rent has reduced

awec

The Student wrote: »

Yeah but if the property was a rental then the available bed spaces for rent has reduced

Yes, but someone currently renting can then buy which subsequently reduces the number of people looking for rentals.

This only really works with investment / second properties. PPRs are a zero-sum game.

The Student

awec wrote: »

Yes, but someone currently renting can then buy which subsequently reduces the number of people looking for rentals.

This only really works with investment / second properties. PPRs are a zero-sum game.

Not necessarily if two couples are renting a house and one of the couples buy the house what happens to the other couple.

Bob24

awec wrote: »

Yes, but someone currently renting can then buy which subsequently reduces the number of people looking for rentals.

This only really works with investment / second properties. PPRs are a zero-sum game.

The Student has a point though, on average when someone turns from being a tenant to being an owner occupier they probably reduce the total number of available beds in the rental market.

My example: had been renting a 1 bed apartment with my partner for years in an area. We are about to move into a 3 beds in the same area which we just purchased and was previously rented to at least 3 tenants (but maybe more, I think some rooms had couples in them). So essentially we are freeing-up 1 bedroom in the area for other tenants but are removing 3 from the market for our own use.

The Student

Bob24 wrote: »

The Student has a point though, on average when some turns from an tenant to an owner occupier they probably reduce the number of available beds.

My example: had been renting a 1 bed apartment with my partner for years in an area. We are about to move into a 3 beds in the same area which we just purchased and was previously rented to at least 3 tenants (but maybe more, I think some rooms had couples in them). So essentially we are freeing-up 1 bedrooms in the area for other tenants but are removing 3 from the market for our own use.

Exactly I keep an eye on the property sector and the number of ex rentals for sale is growing each week. As a landlord I can tell you its because the govt has made it extremely difficult to be a landlord. Its the renters who are suffering.

Baby01032012

One major problem with this dysfunctional market is that there is no distinction between accommodation to rent and that to buy. One displaces the other. There is relatively recently REITs who have bought whole developments to rent. However majority of accommodation for rental are houses. There’s not enough of apartment/ high rises or volume of rental accommodation so it has been a fight between those renting and those buying. And the accommodation that’s coming on stream from small landlords leaving the sector is probably houses.

Also part of problem is social competing with private rentals. Due to poor planning or past demographics there is competition in rental market between HAP and private PAYE tenant which has reduced volume available to rent and pushed up prices.

Ireland was a country of home ownership it never foresaw influx of emigrants or demand for rentals.

adriaaaan

Won't rental demand be solved by the literally thousands of apartments being built right now in Dublin city? Supply is a major problem until new apartments are built, and then it isn't a major problem. People need to calm down about the property situation and stop over reacting, but this is Ireland so.

My heart bleeds for landlords yielding 2 grand a month on 2 bed apartments. That pesky government causing them untold hardship as they Scrooge McDuck into a pool of gold coins.

The Student

adriaaaan wrote: »

Won't rental demand be solved by the literally thousands of apartments being built right now in Dublin city? Supply is a major problem until new apartments are built, and then it isn't a major problem. People need to calm down about the property situation and stop over reacting, but this is Ireland so.

My heart bleeds for landlords yielding 2 grand a month on 2 bed apartments. That pesky government causing them untold hardship as they Scrooge McDuck into a pool of gold coins.

Income tax? Non paying tenants?

Arcade_Tryer

adriaaaan wrote: »

Won't rental demand be solved by the literally thousands of apartments being built right now in Dublin city? Supply is a major problem until new apartments are built, and then it isn't a major problem. People need to calm down about the property situation and stop over reacting, but this is Ireland so.

My heart bleeds for landlords yielding 2 grand a month on 2 bed apartments. That pesky government causing them untold hardship as they Scrooge McDuck into a pool of gold coins.

Not enough are being built, they're not being built in the right places, and they're not being built near high enough. So while the increase in supply will help ease demand, it's not going to solve the housing/rental crisis until building restrictions are relaxed.

Bob24

Arcade_Tryer wrote: »

Not enough are being built, they're not being built in the right places, and they're not being built near high enough. So while the increase in supply will help ease demand, it's not going to solve the housing/rental crisis until building restrictions are relaxed.

Mostly agree with that, *but* it is based on an assumption that demand will remain the same or keep rising. An economic downturn (not necessarily as bad as the previous one) could change things very quickly on th demand side, and while no one knows for sure it is not unlikely to happen in the short to medium term.

Chopper83

Personally think there is a going to be some sort of 'crash' in the next few years, there is bubble in certain areas across Ireland that I don't think is sustainable. I went to see a mortgage adviser last week and the amount they were offering for me to borrow was scary.

Bluefoam

Chopper83 wrote: »

Personally think there is a going to be some sort of 'crash' in the next few years, there is bubble in certain areas across Ireland that I don't think is sustainable. I went to see a mortgage adviser last week and the amount they were offering for me to borrow was scary.

Thanks for the advice, please let us know when the crash will be so we can delay our purchasing plans...

Chopper83

Bluefoam wrote: »

Chopper83 wrote: »

Personally think there is a going to be some sort of 'crash' in the next few years, there is bubble in certain areas across Ireland that I don't think is sustainable. I went to see a mortgage adviser last week and the amount they were offering for me to borrow was scary.

Thanks for the advice, please let us know when the crash will be so we can delay our purchasing plans...

It wasn't advice, it's my opinion.