Do you think property will crash again?

Skedaddle

Pawwed Rig wrote: »

Without trying to provoke a reaction Cork does not even enter the argument. It's suitability for a large port is irrelevant.

Balbriggan was proposed a few years ago and this would seem a good idea. Freeing up all the land around the docks and putting light rail up and down the quays could accommodate huge amounts of residential accommodation.

The elephant on the room imo is the amount of council owned properties walking distance from city centres. There is no need to have relatively un productive people living on premium land.
Removing height restrictions would also help

Cork was only entering the argument in sense they recognised the value of their docklands as prime residential and commercial space and have already begun moving a very large old docks facility (second only to Dublin Port) to an alternative location.

Dublin has alternatives and isn't considering them. They instead spent billions on the port tunnel for some reason to primarily move trucks in and out underground to the city centre ... Mindboggling.

You could be creating a huge prime, high density residential development right in the city centre and also a much better public amenity.

I just do not understand Dublin's planning / lack there of.

You could have a modern (even state of the art), largely automated, dock facility at any of several different ports up the coast with easy access to the motorway network and even fright trains if you plugged it into the rail network.

Arthur Daley

PokeHerKing wrote: »

That's a serious 10 year short right there!

The reality being if you thought property was overpriced in 2002 and held off for a "crash" and bought in 2012 then I'd say you roughly paid the same price for the property but dumped 100k+ into renting for that period.

I would say the percentage of ordinary people who timed it deliberately is in the 0.0001%.

Most people bought when they could and some got lucky with timing as will always happen.

Buy a home that you're happy to stay in for 10+ years and you'll ride most ups and downs.

Depends on the area, but I believe there were properties that cost quite a bit less in 2012, than they did in 2002 even, let alone 2006. Again , depending on the area, you didnt have to put 800 euro a month into rent each month for those ten years. Plus you have the opportunity cost of maybe renting in Dublin in your 20s vs. spending your time commuting 60- 80 miles every day, and all the wear and tear that brings, while you are young and supposedly enjoying yourself. It worked for some people anyway.

theboringfox

Solution to the problem in Dublin is to increase supply and main issue affecting supply in my view is NIMBYism stopping people building up. Build loads of nice apartments at higher levels. Cost of each unit will fall rapidly and more people can live in City centre. That'll free up lot of housing too. We need houses too but it's building upwards into that precious skyline is key and people should be voting out councillors and TDs who oppose it

Mickiemcfist

theboringfox wrote: »

Solution to the problem in Dublin is to increase supply and main issue affecting supply in my view is NIMBYism stopping people building up. Build loads of nice apartments at higher levels. Cost of each unit will fall rapidly and more people can live in City centre. That'll free up lot of housing too. We need houses too but it's building upwards into that precious skyline is key and people should be voting out councillors and TDs who oppose it

I hope they do build up, but above 7 stories the cost per unit actually increases due to increased structural & mech & elec costs.

Villa05

PokeHerKing wrote:

The reality being if you thought property was overpriced in 2002 and held off for a "crash" and bought in 2012 then I'd say you roughly paid the same price for the property but dumped 100k+ into renting for that period.

I note that you excluded the cost of the bust in your example a cost that is borne by all of us through higher taxes, looting of pension Reserves, poor infrastructure and poor services plus massive debt on future generations

The price of a broken property market stretches far beyond the individual cost of accommodation and affects homeowners as well as people who don't own there home.

Andrew Beef

Villa05 wrote: »

PokeHerKing wrote:

The reality being if you thought property was overpriced in 2002 and held off for a "crash" and bought in 2012 then I'd say you roughly paid the same price for the property but dumped 100k+ into renting for that period.

I note that you excluded the cost of the bust in your example a cost that is borne by all of us through higher taxes, looting of pension Reserves, poor infrastructure and poor services plus massive debt on future generations

The price of a broken property market stretches far beyond the individual cost of accommodation and affects homeowners as well as people who don't own there home.

None of that was to fix a broken property market; it was to fix broken banks. As a result of tighter rules, the banks are now insulated.

CalRobert

Elessar wrote: »

Just have to reply to this to say very well said, you are 100% correct.

I work in IT and over the last 3 years EVERY single one of the non-national IT engineers we have hired have resigned and returned to their original country. While I don't know each of their specific reasons, I know at least some of it is due to the housing issue. Our european colleagues are baffled at not being able to get accomodation in Dublin that is so readily available (and the norm) in most EU cities. They are baffled at having to either share a room in a house with 2 or 3 others in the suburbs or having to pay enormous amounts of money for a 12 month lease in a less than ideal apartment.

I'm searching for a 2 bed place at the moment with my girlfriend in north dublin but last nights search turned up 1 (yes ONE) place within our budget (1500pm) in a fairly wide area. It's absolutely crazy how the market is at the moment. Where she is from (a city in Germany smaller than Dublin) good quality apartments are readily available and 800pm would get you a really nice place, with all bills included, and an indefinite lease.

I just can't believe Ireland (esp Dublin) has gotten the way it has with regards accomodation. We need thousands more one and two apartments in and near the city ASAP.

I'm a software engineer from another country living in Dublin for 5 years. This rings pretty true. I wouldn't want to return to my home country but if I can get a remote work arrangement set up I could see buying a farmhouse in Germany or something cash and just wokring from there (once naturalized).

It seems crazy that earning around the 90th percentile of incomes in this country you can't buy a halfway decent flat in city centre or near a rail line.

Villa05

Andrew Beef wrote:

None of that was to fix a broken property market; it was to fix broken banks. As a result of tighter rules, the banks are now insulated.

Broken banks are a consequence of a broken property market. Insulation is worthless when your foundations are on bog land.
Banks are still broken. The ratio of non performing loans on their books is multiples of their eu counterparts. This is after a bailout that brought the imf to our doorstep and 5/6 years of economic ""recovery"

Andrew Beef

Villa05 wrote: »

Andrew Beef wrote:

None of that was to fix a broken property market; it was to fix broken banks. As a result of tighter rules, the banks are now insulated.

Broken banks are a consequence of a broken property market. Insulation is worthless when your foundations are on bog land.
Banks are still broken. The ratio of non performing loans on their books is multiples of their eu counterparts. This is after a bailout that brought the imf to our doorstep and 5/6 years of economic ""recovery"

The above just isn’t accurate.

Banks now model property crashes as part of their capital maintenance protocols.

People seem to delight in thinking that another crash is coming and in lampooning people who content that “this time it’s different”.

But this time it’s very different.

Arthur Daley

The Banks are 'broken' to the extent that there is state sponsored fraud in people withholding assets/cash and not repaying the amounts they owe the Banks. Including large numbers of buy to let Landlords. Who supposedly 'run a business'

AIB and BOI announced huge profits recently. €1bn plus. The Banks would be fine if the political and media class were not conspiring to defraud them (and by extension us).

But the Banks are reluctant to lend into this environment. Quite understandably. Foreign lenders naturally won't touch it with a barge pole.

kaymin

Andrew Beef wrote: »

The above just isn’t accurate.

Banks now model property crashes as part of their capital maintenance protocols.

People seem to delight in thinking that another crash is coming and in lampooning people who content that “this time it’s different”.

But this time it’s very different.

There was stress tests all through the crash and most if not all of them proved to be significantly inaccurate. There's a higher level of capital required now as per Basel II rules but I wouldn't have much faith in the accuracy of any modelled property crashes.

LuckyLloyd

Some great posts by skedaddle. Whether it be indicative of an impending crash or normal supply and demand pricing - the current housing situation is intolerable and should not be allowed to continue. Poor infrastructure and the unavailability of reasonably priced housing in places of economic activity will strangle the economy over time if left unchecked.

PokeHerKing

Villa05 wrote:

I note that you excluded the cost of the bust in your example a cost that is borne by all of us through higher taxes, looting of pension Reserves, poor infrastructure and poor services plus massive debt on future generations

I also excluded to mention what colour underwear I was wearing as it had no relevance to my post.

vmb

CalRobert wrote: »

I'm a software engineer from another country living in Dublin for 5 years. This rings pretty true. I wouldn't want to return to my home country but if I can get a remote work arrangement set up I could see buying a farmhouse in Germany or something cash and just wokring from there (once naturalized).

It seems crazy that earning around the 90th percentile of incomes in this country you can't buy a halfway decent flat in city centre or near a rail line.

Very similar profile, also soft engineer (spanish), we bought a house in Clongriffin two years ago.

Now they are more expensive here but there are still 3 beds under 300k. Not the new ones tho, but super close to the dart station. It's a 17min commute to connolly in my case, and my partner (also soft engineer) has a 25 min to grand canal dock. There you have the ifsc and the docks, plenty of jobs to choose

It is not "donnybrook", but to me, it is just what we need. The worst part by far is the dart station where some teenagers have been skating and breaking window panels. I don't care about teenagers, but even the smallest anti social behaviour can evolve pretty quickly

fliball123

Hector Savage wrote: »

Course it will crash again, you think it can just grow and grow and grow ?

Infinite growth based on finite resources will always crash.

There is no basis for a crash within the next 20 years. Look at the factors here

Supply continues to be low building is not even at the level it should be if demand was normal and not so high

Demand is increasing year on year and the limited supply is being snapped up

We have the highest birth rate in the OCED these have to be housed)

We are living longer meaning people need to be housed longer.

We have nett immigration coming into the country with immigrants coming in from non traditional areas like south Americans coming here to learn English over the last number of years. These all need to be housed

Renting is now more expensive than buying in a lot of cases - Making it more attractive for buy to let setups meaning less supply.

Brexit means that Dublin is possible the most attractive base for foreign MNCs to set up in Europe. The workers here have to be housed

Competition is now global, foreigners , vulture funds, pension funds are now a big part of the buying market further depleting supply

Last figures we have over 100k people on the housing list - these need to be housed further decreasing supply

Ireland is a small country and there is a finite amount of land in the country. Prices will rise for a long time here.

Even if there is a crash like 08 the mortgage holders that took loans out since the crash will have more skin in the game due to the 80/20 so there will not be a lot of property going on the market at the same time.

I could be wrong but all indicators are 20years for rises at least

hots

fliball123 wrote: »

There is no basis for a crash within the next 20 years.

I'd agree with lot's of your post, but this is just silly. 20 years is a long time.

Bob24

fliball123 wrote: »

Ireland is a small country and there is a finite amount of land in the country. Prices will rise for a long time here.

To European standards we have very low population density. If a lack of land was a major cause of concern for us, most European countries would already have civil wars because of it (but Belgium which is 5 times more densely populated than Ireland has cheaper housing).

fliball123

hots wrote: »

I'd agree with lot's of your post, but this is just silly. 20 years is a long time.

true but if you look at the last cycle is started back in the early 90s and finished in 2011/12 about 20 years from start to finish or from bust - boom - bust

This time the fundamentals are better, the banks are more protected and the supply/demand ratio is a hell of a lot more skewed on the demand side.

fliball123

Bob24 wrote: »

To European standards we have very low population density. If a lack of land was a major cause of concern for us, most European countries would already have civil wars because of it (but Belgium which is 5 times more densely populated than Ireland has cheaper housing).

That is just one of the factors but just to throw a thorn in your theoy Belgium is almost land locked with countries surrounding it and I have a friend who is living in Eischweiler Germany (forgive the spelling) who commutes to work in Liege in Belgium.

Also I have never been but would Belgium promote the use of high rises?? unlike Ireland

Bob24

fliball123 wrote: »

That is just one of the factors but just to throw a thorn in your theoy Belgium is almost land locked with countries surrounding it and I have a friend who is living in Eischweiler Germany (forgive the spelling) who commutes to work in Liege in Belgium.

Because some people commute there doesn’t change the fact that it is 5 times the population density and more affordable housing. It’s not like Luxembourg or Switzerland where people commute to work from other counties because housing there is too expensive. They just do it because it is easy and they like it that way.

So we are not going to have a land shortage anytime soon.

(a real issue though is the poor use of this land in Dublin with a lot of unused land due to improper zoning or speculation, and the urge for every person to have a house with a garden which means very low popularion density for a capital city)

fliball123

Bob24 wrote: »

Because some people commute there doesn’t change the fact that it is 5 times the population density. We are not going to have a land shortage anytime soon.

(a real issue though is the poor use of this land in Dublin with a lot of unused land due to improper zoning or speculation, and the urge for every person to have a house with a garden which means very low popularion density for a capital city)

No I agree but desirable places to live are on the decrease and as I say have you any stats about high rises in Belgium as Ireland just dont do them and any that were here like Ballymun and Killbarrack have been knocked down and ruled a bad idea for some reason.

Wanderer78

fliball123 wrote:

true but if you look at the last cycle is started back in the early 90s and finished in 2011/12 about 20 years from start to finish or from bust - boom - bust

Past economic cycles are no guarantee for current economic trends and possible future economic busts, such is the complexity of these cycles, but I do understand your logic.

fliball123 wrote:

This time the fundamentals are better, the banks are more protected and the supply/demand ratio is a hell of a lot more skewed on the demand side.

I suspect our banks are not as well protected as we think, and the next economic crisis will be more so effected from external factors than the last time, I think we maybe becoming complacent regarding these issues

fliball123

Wanderer78 wrote: »

Past economic cycles are no guarantee for current economic trends and possible future economic busts, such is the complexity of these cycles, but I do understand your logic.



I suspect our banks are not as well protected as we think, and the next economic crisis will be more so effected from external factors than the last time, I think we maybe becoming complacent regarding these issues

I think the 2 issues in the near future Trump and Brexit are the threats. I personally think that brexit will push prices up but Trump is a complete head banger and could press the little red button one morning if he had soggy corn flakes he is that unpredictable.

If and when the crash comes there will not be a wholesale like what we seen back in 2008 - 2011 due to the mortgage holder actually having more skin in the game so the jingle mails with keys will not happen at all this time. But anyone saying a crash is coming soon should provide some fundamentals I have put down over half a dozen showing both short and longer term prices will be rising

Skedaddle

Considering Trump's just lost his most senior economic advisor and is reportedly at loggerheads with the Treasury Secretary for threatening trade wars. I think things in the US may go completely crazy over the next few months. Although, it's also quite likely that Trump will just become completely ineffective, particularly after the mid-term elections. I could see a scenario where he's just ranting on Twitter, while the serious business of government is just ignoring him.

I suspect Brexit will benefit Dublin and probably Cork and some of the other cities in the sense that a lot of UK-based investors will want to go somewhere more stable, even if Brexit doesn't happen as a complete crash out. The UK has really taken its own reputation as a good place and torn it to shreds. It's not just Brexit, but rather that there's a willingness to rip the foundations out from under the economy and do it without any plan, all based on a political whim. That really does not spell out a very safe investment environment.

Businesses still can't plan as they have no idea what's going to happen with Brexit as the UK is being totally unclear about what its intentions are and what it wants. It's an unprecedentedly stupid situation.

We're likely to see inward investment from a lot of medium companies looking for a new EU home and one that doesn't require much adjustment to get used to. Ireland's an ideal destination for a lot of companies that need to get away from the volatility of what's going on in the UK at present.

Even if Brexit doesn't happen, there'll be a Brexit 2.0 and they'll keep attempting this kind of stuff as the politics has not been resolved.

Arthur Daley

Wanderer78 wrote: »

I suspect our banks are not as well protected as we think, and the next economic crisis will be more so effected from external factors than the last time, I think we maybe becoming complacent regarding these issues

This will be the case. The issue next time will be dictated by external factors I would think.

So are some here suggesting average property prices can keep growing for another what 10-15 years? What will the average house cost then? 1 million euros? Who is going to pay it? Wages are being capped in an awful lot of places, even today. The increase in supply of labour has suppressed wages at many levels. Automation and AI will put hundreds of thousands out of work within the next 30 years according to the plans being rolled out of places like Davos.

But even if you go all in for this form of economics, what are the consequences. The Irish Government has signalled it is a one way bet, load up on as much debt as possible on the never never, in the belief property can only go up. When it goes wrong, blame everyone but yourself. Thankfully most in society do ignore the government and refrain from this behaviour. I'm glad many people have (or have to have) sense, despite what Fine Fail encourages.

johnp001

Arthur Daley wrote: »

...

So are some here suggesting average property prices can keep growing for another what 10-15 years? What will the average house cost then? 1 million euros? Who is going to pay it? Wages are being capped in an awful lot of places, even today. The increase in supply of labour has suppressed wages at many levels. Automation and AI will put hundreds of thousands out of work within the next 30 years according to the plans being rolled out of places like Davos.

...

Property prices can increase relative to wages as did in the early 2000's but the money has to come from somewhere. At that time falling interest rates and relaxing of lending conditions were a major contributory factor.
If prices continue to increase faster than wages and interest rates are constant and lending is regulated then ownership will be less attainable for the next generation. That is not to say that prices can't continue to rise but if they do the next generation will have lower rates of home ownership and a larger proportion of property will be owned by banks/NAMA/vulture funds/big landlords etc...

SNNUS

Property price speculation will just end up driving you insane.

Didactic Ninja

Skedaddle wrote: »

There are few if any cities of Dublin's size (around 1 million) where a 72.9km commute would be considered normal. That's how far Mullingar is.

It's the 39th largest metropolitan area in the EU up there with Lille, Helsinki, Glasgow and Antwerp.

Incidentally, most cities of that scale on the continent have very good public transportation, some even have full metros.

The way that people talk on some of these threads you'd think it was reasonable to compare Dublin with megacities like London, Paris, New York etc.

It's a pretty small city with totally inadequate housing stock to meet an economic boom. This is driven by a dysfunctional banking system that's not healthy enough to fund development, developers who are still not over the 2008 crash and a planning system that's created endless problems over the decades.

We are still basically nursing debts from the last crash which is in large part why the supply hasn't been on stream and is being slow to come back.

Also the housing stock is totally inappropriate to meet the demand. We have a situation where there are very few apartments suitable for single people in particular which results in thousands of young professionals having to share accomodation in family homes. That's pushing those of reach of families while still providing poor accommodation. If you think about it, instead of a host accomodating a family, in a lot of cases in Dublin it's accomodating maybe 4 or even 6 ( might be two couples and two singles) adults on good incomes.

It's actually fairly unusual (and very unattractive) to have to house share beyond student days, but it's the norm in Dublin. It means not having your own bathrooms, cooking facilities and having limited privacy.

I think a lot of the properties in Dublin are only meeting the insane rents by people sharing. I've never seen anywhere with such an amount of doubling and tripling up.

It's one reason I know quite a few Continental professionals in IT who've packed up after a year and gone to Berlin and elsewhere. Dublin (and even Cork) has very inadequate accommodation.

If you look at cities like Brussels and Antwerp, a couple or even a single person on a reasonable income can expect to be able to live on their own in a pretty nice apartment, within the city and suburbs (not 79km away) and not be at the pin of their collar. You're not going to be able to afford a mansion, but you'll have your pick of nice, comfortable, reasonably-sized apartments in most suburban areas as will have a good quality of life. You'll also find plenty of long lease options and unfurnished apartments that you can make your home. They're not full of landlord furniture and cheap appliances someone found while dumpster diving or in some ultra cheap shop that does landlord specials. People actually start building up their own furnishings in their 20s as they move onwards and upwards they just bring them with them.

That's not an unreasonable or unusual expectation. It's also a big part of what defines quality of life.

Failure to address this issue or pretending that it's a normal state of affairs is a major part of why Dublin doesn't rank well as a livable city.

What's the point of working hard if it's just running on a hamster wheel to live in what amounts to a hovel? Or commuting 79km to a small city? It makes no sense and it's what's going to limit Dublin and Ireland's growth potential.

I find the Irish market is really creating a very odd mess of sharing and nearly locking people into student like living standards for way too long. I know single professionals with good jobs in Dublin still sharing in their late 30s and even 40s. They've no a prospects of any better as their industries don't pay the wage levels that will afford more.

Also in Ireland if you're not married or living with your partner, it's a complete nightmare to find decent housing in the cities as a single adult. Unless you're on a very good income, you really might as well emigrate. There's very, very little in the way of suitable housing.

Most of the French people I know who move here for IT jobs see Ireland as a place to break into an industry, then leave. That's because of three factors:

1. Housing.
2. Health - mostly anyone I know who has experienced the HSE via the A&E system or has had a serious medical issue and has had to a wait months just re-evaluates remaining here and goes back to France or Germany etc. I know a lot of continental Europeans and there really is horror at the state or the Irish health system. It's barely developed world standards in terms of access to services, yet it's very well funded. Again: bad planning/management just like housing. It operates as one endless crisis with everyone running around in circles chasing their tails. How the hell we have created this mess is beyond me. It's literally unbelievably bad.
3. Pensions. A lot of people I've spoken to see Ireland and also Britian as places to start a career but not places to continue it or retire in. There are concerns about pension provision, regulation of funds, poor state services etc.

That's not good for our economy as we're only getting people to stay for a few years at most.

Fix those 3 and you've one of the world's best places to live. Don't fix them and you will always be second tier.

The best post i have read on boards in a long time.very accurate from what i have seen.
A lot of people in their early 30's are approaching a crossroads in Ireland but Dublin in particular.

i am currently in this situation.
Im 33, work in Dublin and make a great salary but i am not willing to commit to a mortgage (particularly because in most areas i deem them to be not worthy of the amounts asked).
I am not moving to Naas or Dundalk etc and sitting on the m1 or m50 everyday and paying 100 quid a month on tolls.
Renting alone is not an option even on "great money" and the prospect of spending the next 5 or so years living with pissed up housemates on a two year beano in grand canal dock doesnt appeal.

The IFSC is 4 to a gaf with google and facebook heads paying 700-850 each to share ( im friends with a gang of them) . They hang around for a year or two and then **** off to sweden and france and get replaced by a fresh batch.
Single people, single mothers, people on less than 40k are ****ing bolloxed. Yeah you can rent a room in balbriggan, but at some stage you'd want to have somewhere to put up your ACDC posters and maybe grow a potted plant. We have a generation of lost souls from about 28-36 who are not on the traditional tramlines of life. We kept our side of the deal by getting qualified and getting employed, but try and hold down a relationship when you are in your mothers spare room or sharing with 4 panel beaters from Hungary.

My missus is foreign and we do the long distance thing. i travel abroad a lot with work. At the moment id imagine ill be gone soon.To where i don't know, but while i love ireland for the friendliness and "the craic" and the general feel of safety , i see no plan, all stick and no carrot from the government, and while i am still in my "best years" im not willing to rent or buy a box room in swords that i will spend 40 years trying to pay off.
In 2018 you can't bring plastic bottles back to get 5 or 10 cent like abroad. they encouraged us to buy diesels and now they are going to tax us out of them.
i see a country of punitive actions with no innovation. The smoking ban was the only thing i can remember that i thought was truly great.
USC came in "temporarily". its still there.

Things are so bad that a simple relationship breakdown can see you lose everything ( even outside a marriage) . You breakup with you missus and you are back in your mothers spare room or couch surfing .

Irish society is designed to "couple up". you are ****ed if you are on your own.

smurgen

I think anyone buying in the next 3 years or so is making a massive mistake.property prices are in for a crash and saddling up with a big mortgage is just madness.

CalRobert

Skedaddle wrote: »

There are few if any cities of Dublin's size (around 1 million) where a 72.9km commute would be considered normal. That's how far Mullingar is.

It's the 39th largest metropolitan area in the EU up there with Lille, Helsinki, Glasgow and Antwerp.

....
They're not full of landlord furniture and cheap appliances someone found while dumpster diving or in some ultra cheap shop that does landlord specials.
....
....

This is fantastically well-put.

Regarding this:
"they're not full of landlord furniture and cheap appliances someone found while dumpster diving or in some ultra cheap shop that does landlord specials."

I got so effing sick of living in a storage unit for a bunch of **** the landlord bought in the mid-90's (there was a sticker on the back of a chair for bananas expiring in 1995) I just gave almost all of it to oxfam and got my own stuff. It was worth maybe a week's rent in total. He can take it from my deposit; I don't really care. I installed my own washing machine too because demaning I do all my laundry in 12 hours a week is absurd.

It's part of the general infantilization of renters that seems to be a major part of Irish society. If you're renting, you're not an adult who can afford to furnish an apartment, apparently, or so the troglodytes determining housing policy think.