Property Market 2018

tom1ie

psinno wrote: »

Why shouldn't the 25% of adults who have no kids or just 1 kid buy a 2 bedroom apartment?

Yes agreed, but if they are planning on having more kids, then they won’t have enough room, and if the market tanks and they own the property they are stuck, hence my point.
Why can’t they rent (apart from the obvious, rents are atrociously high,a point I’ve already addressed.)

Graham

donkeyoaty0099 wrote: »

So on one hand we're being told to buy a house for life and don't get into a ladder situation and the other we get penalized for it? Seems fair.

Different houses for different life stages.

tom1ie

Samuel T. Cogley wrote: »

The asset doesn't nered to do anything than retain it's relative value to the rest of the housing market. If a 150K 1 bed loses 50K so long as there is posative equity the 350K house the couple want to move into has lost a simialr if not greater amount. People should be looking to establish equity ASAP not paying off other people's mortgages if they plan to stay put in the medium term and I say this as a landlord myself.


Part of the problem in the rental sector is it's being used for classes of people it never should have. Long term renters should be an absolute rarity.

But I thought the majority of well functioning cities in Europe had long term renters to the betterment of the landlord, tenant, the owner occupier market and society as a whole. I believe it’s called a functioning mature rental sector.

Midlife

tom1ie wrote: »

But I thought the majority of well functioning cities in Europe had long term renters to the betterment of the landlord, tenant, the owner occupier market and society as a whole. I believe it’s called a functioning mature rental sector.

Irish banks and landlords essentially view property as a big profit machine. Every European city would ned up the same if

a: banks and mortgage lenders were looking to lend as much as they can at the highest rates possible
b: sellers and REAs were seeking to drive prices up as much as possible
c: landlords were generally in it as a business and were collectivly driving up prices as much as possible

I think the big difference is that in Europe, it's viewed as a utility. In France you can get 20 years fixed at 1.5% because the banks don't view property as something to be squeezed dry. Properties are taken off the market as soon as asking is met because we're not loooking for bidding wars. Long term affordable tenancies are the norm because that's what people need to function.

We approach it in a totally totally different way here. It's a get rich quick scheme.

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Graham wrote: »

Different houses for different life stages.

Grand if you can guarantee that the 2 bed apartment I buy tomorrow won't drop 25% in value in 5 years time when I go to move

Graham

donkeyoaty0099 wrote: »

Grand if you can guarantee that the 2 bed apartment I buy tomorrow won't drop 25% in value in 5 years time when I go to move

Because that's a common feature of every other property market???

3 or 4 bed semis for everyone then, that's working pretty well so far. Ohhhh

tom1ie

Graham wrote: »

Because that's a common feature of every other property market???

3 or 4 bed semis for everyone then, that's working pretty well so far. Ohhhh

So what happens to the poor unfortunates that buy that one or two bed app. Then the market collapses leaving them with 100k negative equity, meanwhile a rugrat or two has come along and their “foot on the property ladder” property has turned into a noose around their neck.
Now imagine if the same couple had of rented that apartment instead of buying. They’ve just about managed to scrape 25k together for a deposit despite the crazy high rents, then the property market crashes, all of a sudden their situation is looking a lot more promising. No neg equity and affordable house prices available.

Graham

tom1ie wrote: »

So what happens to the poor unfortunates that buy that one or two bed app. Then the market collapses leaving them with 100k negative equity, meanwhile a rugrat or two has come along and their “foot on the property ladder” property has turned into a noose around their neck.
Now imagine if the same couple had of rented that apartment instead of buying. They’ve just about managed to scrape 25k together for a deposit despite the crazy high rents, then the property market crashes, all of a sudden their situation is looking a lot more promising. No neg equity and affordable house prices available.

You're probably right, paying record rents while praying there's going to be a crash soon sounds like a much more sensible solution.

Unless you're paying €200,000 rent over the next 10 years while you wait.
Unless nobody is getting mortgages straight after a crash.

You've probably gathered I'm not a great believer in "the next crash will fix everything" theory.

tom1ie

Graham wrote: »

You're probably right, paying record rents while praying there's going to be a crash soon sounds like a much more sensible solution.

Unless you're paying €200,000 rent over the next 10 years while you wait.
Unless nobody is getting mortgages straight after a crash.

You've probably gathered I'm not a great believer in "the next crash will fix everything" theory.

Yeah I got that alright! I don’t believe the next crash will solve everything either in fact it will mean the state incurring more debt due to people with mortgages being unable to pay which will leave bad debts on the banks books which will be paid for by the tax payer anyway. However if you happen to have a sum of money at the time of the next crash, it just might be possible to make it work to your advantage.

chrismon

Graham wrote: »

You've probably gathered I'm not a great believer in "the next crash will fix everything" theory.

This is what so many people believe.

Looking to buy a house at the moment and all I hear is "Wait till the next crash to buy a house". Yes Susan, I'll buy a house with the imaginary money that will be lent to me when that happens.

djPSB

Question: I have already bought my first house by myself using first time buyer 10% deposit mortgage.

If my other half and I apply for a mortgage to build a house together, can we apply for a mortgage that requires a 10% deposit as it is her first time buying or will we require 20% deposit.

Samuel T. Cogley

tom1ie wrote: »

But I thought the majority of well functioning cities in Europe had long term renters to the betterment of the landlord, tenant, the owner occupier market and society as a whole. I believe it’s called a functioning mature rental sector.

It's a different market where renting in cheaper than buying and the extra money can be invested in a pension. Where there are long term lerases people are no more, probably less so, mobile than purchasers so frankly it's horses for courses. They do it one way, we do it another.

o1s1n

djPSB wrote: »

Question: I have already bought my first house by myself using first time buyer 10% deposit mortgage.

If my other half and I apply for a mortgage to build a house together, can we apply for a mortgage that requires a 10% deposit as it is her first time buying or will we require 20% deposit.

You'll need 20%. In a similar situation myself

Bigmac1euro

Graham wrote: »

Because that's a common feature of every other property market???

3 or 4 bed semis for everyone then, that's working pretty well so far. Ohhhh

I’m curious to know what kind of house you live in ?

Samuel T. Cogley

steo_magra wrote: »

I’m curious to know what kind of house you live in ?

I live in a 3/4 bed house and I traded up from an apartment. While I may still have the aparetment the low mortgage allowed me to save again regardless of negative equity, not an option I would have had renting.


Any yes the move was promted by squeezing out a kid or two, not me obviously but the missus.

Villa05

Samuel T. Cogley wrote:

It's a different market where renting in cheaper than buying and the extra money can be invested in a pension. Where there are long term lerases people are no more, probably less so, mobile than purchasers so frankly it's horses for courses. They do it one way, we do it another.

Functional V Dysfunctional

Bigmac1euro

Samuel T. Cogley wrote: »

I live in a 3/4 bed house and I traded up from an apartment. While I may still have the aparetment the low mortgage allowed me to save again regardless of negative equity, not an option I would have had renting.


Any yes the move was promted by squeezing out a kid or two, not me obviously but the missus.

3 bed house ? A 4 bed house ?
Or 3/4 of a house ?

Bigmac1euro

Samuel T. Cogley wrote: »

I live in a 3/4 bed house and I traded up from an apartment. While I may still have the aparetment the low mortgage allowed me to save again regardless of negative equity, not an option I would have had renting.


Any yes the move was promted by squeezing out a kid or two, not me obviously but the missus.

Would you not sell both. And move into a 3 bed apt. Save some from the rest of us!!!!!!

Samuel T. Cogley

steo_magra wrote: »

3 bed house ? A 4 bed house ?
Or 3/4 of a house ?

Depends on my mood and whether I sleep downstairs or use it as a family room. All this lovely space :pac:

Samuel T. Cogley

steo_magra wrote: »

Would you not sell both. And move into a 3 bed apt. Save some from the rest of us!!!!!!

Can't afford to. I bought in an area many would not live in as they don't know the area and cuaght the house just as the market began it's up turn - having tried without sucess to buy during the last crash - so it was nice an cheap compared to a 3 bed apartment which I find pointless out in the suburbs.

If there was a nice three bed/penthouse somewhere central and affordable I'd probably strongly consider it. Then I love the area I'm in so I dunno.

Aparently 1 beds are only good for renting so I'm not doing you a disservice there. :pac:

M.Cribben

chrismon wrote: »

This is what so many people believe.

Looking to buy a house at the moment and all I hear is "Wait till the next crash to buy a house". Yes Susan, I'll buy a house with the imaginary money that will be lent to me when that happens.

Agreed. And even people with large cash savings (as a nation have €100 billion on deposit - https://www.irishtimes.com/business/economy/household-deposits-hit-100bn-despite-zero-rate-of-return-1.3275039) would start buying up the cheap property as family homes/trading up/investments or to get out of the rental market. Not to mention competition from the REITs and foreign pension funds who are snapping up our apartment blocks even at current inflated prices. All this would push prices back up and reverse the effects of any crash.



Anyway the chance of a crash in prices while this supply/demand imbalance exists is slim to none. When building levels ramp up to 30,000+ units/year for 5 years straight then we may begin to address current ( and backlogged ) demand levels.

Arthur Daley

Midlife wrote: »

I think the big difference is that in Europe, it's viewed as a utility. In France you can get 20 years fixed at 1.5% because the banks don't view property as something to be squeezed dry.

Interest rates can be 1.5% because no pay mortgage, no more housey house pour vous, mon cherie.

Now we have it baked in that Banks cannot foreclose effectively in this country, mortgage lending is effectively unsecured lending here now. Which has to attract a higher return to justify the higher risk of losses. Simple economics.

Samuel T. Cogley

I'm less sure about no crash, are we not worried about Brexit being a total fuster cluck?

Phantom1234

Any thoughts on property market in cork? Been watching for last 2 years and seems to be approaching silly territory !!

Bob24

Arthur Daley wrote: »

Interest rates can be 1.5% because no pay mortgage, no more housey house pour vous, mon cherie.

Now we have it baked in that Banks cannot foreclose effectively in this country, mortgage lending is effectively unsecured lending here now. Which has to attract a higher return to justify the higher risk of losses. Simple economics.

That’s part of the explaination but not the only thing.

Not only French banks offer 1.5%, but also 1.5% *fixed* for the full duration of the mortgage.

I’m not sure why, but they must have betters ways with fund themselves in the long term and/or are better at managing long term monetary risks.

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Graham wrote: »

You're probably right, paying record rents while praying there's going to be a crash soon sounds like a much more sensible solution.

Unless you're paying €200,000 rent over the next 10 years while you wait.
Unless nobody is getting mortgages straight after a crash.

You've probably gathered I'm not a great believer in "the next crash will fix everything" theory.

Was talking to an EA in Dublin this week who is saying things are stagnating and ready to crash.

Bob24

donkeyoaty0099 wrote: »

So on one hand we're being told to buy a house for life and don't get into a ladder situation and the other we get penalized for it? Seems fair.

You are probably not hearing the same person saying both things. Those are two different models and currently we have chosen the first one - which is not exactly working great for us.

Bob24

aloooof wrote: »

I think Stamp duty would have to come into this equation as well.

Increasing LPT effectively increases the cost of owning a property. If the goal is to make the market more fluid, the complement to this would be reducing Stamp Duty to reduce the cost of buying/selling a property.

Agreed it should be implemented in tandem with measures to keep the cost of swapping property low (as well as good solutions for bridging mortgages).

Having said that while I don’t have actual figures to back it up my impression is that Irish Stamp Duty is already pretty low compared to most European countries.

Samuel T. Cogley

Ulises Gifted Stoicism wrote: »

Was talking to an EA in Dublin this week who is saying things are stagnating and ready to crash.

What was his/her reasoning for a stagnation would lead to a crash or that a crash is imminent?

Graham

Ulises Gifted Stoicism wrote: »

Was talking to an EA in Dublin this week who is saying things are stagnating and ready to crash.

While I'm suitably convinced an EA is useful when it comes to buying/selling property, I'm not entirely sure they are particularly well placed to forecast the outcomes of Brexit, the local/national/international economy.