When will the Irish property market crash?

wonderwall900

It can't keep going like this lads. Do we ever learn our lessons with this kind of thing?

whiskeyman

Today is gonna be the day...

kala85

What's going to make it crash

Solomon Pleasant

Can't see it crashing anytime soon because it isn't fueled by reckless borrowing and cheap credit, but rather an undersupply of housing.

Therefore, a gradual balancing of supply and demand should theoretically restore house prices at a gradual rate rather than a bust.

wonderwall900

whiskeyman wrote: »

Today is gonna be the day...

That they're gonna throw it back to you?

It'll be a soft landing, just like last time.

wonderwall900

Solomon Pleasant wrote: »

Can't see it crashing anytime soon because it isn't fueled by reckless borrowing and cheap credit, but rather an undersupply of housing.

Therefore, a gradual balancing of supply and demand should theoretically restore house prices at a gradual rate rather than a bust.

Do you really think a one bedroom apartment in Tallaght is worth 150 thousand euros? http://www.daft.ie/dublin/apartments-for-sale/tallaght/73-exchange-hall-tallaght-dublin-1763069/

Twenty Grand

wonderwall900 wrote: »

Do you really think a one bedroom apartment in Tallaght is worth 150 thousand euros? http://www.daft.ie/dublin/apartments-for-sale/tallaght/73-exchange-hall-tallaght-dublin-1763069/

Is the new iPhone worth 1000 euro?
It's worth it if someone is willing to pay.

Thespoofer

Twenty Grand wrote: »

Is the new iPhone worth 1000 euro?
It's worth it if someone is willing to pay.

It makes you question the value of a Euro these days.

Blaas4life

I just hope it's as boomy as last time....was too young to enjoy the last boom



Needs more tequila

wonderwall900

wonderwall900 wrote: »

Do you really think a one bedroom apartment in Tallaght is worth 150 thousand euros? http://www.daft.ie/dublin/apartments-for-sale/tallaght/73-exchange-hall-tallaght-dublin-1763069/

How much does it cost to build a block of 1 beds in tallaght these days?

EdgeCase

I think you're seeing a temporary bubble due to lack of supply.

There's a limit to how much credit people can get at the moment and I think you're starting to see that wall being hit already.

I have my doubts there'll be a 2008 style crash, but there will be a correction as supply comes back on or, if the international instability coming from Trump and Brexit causes a major downturn, which is not beyond the realms of possibility.

Fr_Dougal

Solomon Pleasant wrote: »

Can't see it crashing anytime soon because it isn't fueled by reckless borrowing and cheap credit, but rather an undersupply of housing.

Therefore, a gradual balancing of supply and demand should theoretically restore house prices at a gradual rate rather than a bust.

Yeah, a soft landing. 😬

There’ll be a crash alright, we’re in a tech bubble at the moment and as soon as that bursts it will have an impact on jobs and house prices.

Wheeliebin30

Well if the opposition get their way of building 100s if thousands of houses in the next few years well it will happen again.

But then again most people are advocating this.

SEPT 23 1989

too much money being pumped into the economy again I'm doing nicely out of it but its worrying all the same

somefeen

Im just hoping I'm rich before it does happen, then I can buy lots of houses and make a killing when the boom comes around again.

ToddyDoody

It's time to sell when something untoward happens the states, such as 911 or a big financial institution there gets into significant trouble.

Solomon Pleasant

Fr_Dougal wrote: »

Yeah, a soft landing. 😬

There’ll be a crash alright, we’re in a tech bubble at the moment and as soon as that bursts it will have an impact on jobs and house prices.

I did say theoretically..

Roger_007

The price of property never stands still. It's either going up or down. The current prices are reaching an unsustainable level, ( a level where most people can no longer afford to buy). When the tipping point is reached, prices will start to fall and more and more owners will want to sell. I anticipate that this point will be reached in the next 2 or 3 years. That's when a crash of some degree will happen.

wonderwall900

Roger_007 wrote: »

The price of property never stands still. It's either going up or down. The current prices are reaching an unsustainable level, ( a level where most people can no longer afford to buy). When the tipping point is reached, prices will start to fall and more and more owners will want to sell. I anticipate that this point will be reached in the next 2 or 3 years. That's when a crash of some degree will happen.

The most sensible reply so far

Highly doubtful. Only Dublin is really experiencing this rise in prices and that's due to the shortages. The rest of the country is still slowly raising in price, and is nowhere near to being unsustainable. It's far more likely we'll see a shift away from Dublin to another part of the country, and the issue will slowly resolve itself.

Solomon Pleasant

9% of people have so far voted for there never being a bust again.

Now that is worrying.

jimbobaloobob

[Deleted User] wrote: »

Highly doubtful. Only Dublin is really experiencing this rise in prices and that's due to the shortages. The rest of the country is still slowly raising in price, and is nowhere near to being unsustainable. It's far more likely we'll see a shift away from Dublin to another part of the country, and the issue will slowly resolve itself.

But will they only buy elsewhere if the jobs are elsewhere ? Can't see people buying further and further away from Dublin and being content to commute

Rents around the country are on the up and up so demand is tight for buying nationwide.
What would burst a tech bubble?

touts

Next 18 months:
- Trump's Trade Wars start to bite as he looks for re-election hitting the multinationals. He'll cause mayhem and his base vote will love him for it.
- Brexit is hard and messy destroying the agri-food sector who find themselves tariffed out of their main market and with reduced access to the continent as their perishable goods sit in long customs checks trying to use the UK as a bridge to Europe while there is woefully inadequate capacity on ferries capable of going straight to the continent.
-Brexit is hard and messy meaning Ireland finds itself out of the "UK and Ireland" market most companies currently classify us in. That means the tiny "Ireland" market is no longer really attractive to trade in. That reduced choice and competition on our shelves causing prices to rise.
- Brexit is hard and Messy and people suddenly find it costs a lot more to get products from websites ending in .co.uk and websites ending in .fr or .de etc won't even entertain us.
- Merkel is gone in Germany and their new leadership makes Ireland's corporate tax a high priority target.
- Euro interest rates rise hitting those on trackers who can't afford the rise and have to reducr spending in other areas of the economy.
- Sinn Fein get into government and some of their left wing policies make Ireland a less attractive place politically for multinationals.

Any one of those alone may not cause a crash (with the exception of brexit) but combine those and then the idea of buying a 3 bed semi-d for €400k from someone who bought it for €80k 5 years ago will not seem very attractive. And the first to sense that lack of attraction will be the banks who will start to tighten up lending and once that happens then the crash starts.

I heard a phrase recently that smart investors bought 5 years ago and sold 5 weeks ago. If I was sitting on an investment property I'd be very tempted to cash in and take my money off the table now and wait for the economic cycle to turn in my advantage again.

kippy

2008

wonderwall900

Solomon Pleasant wrote: »

9% of people have so far voted for there never being a bust again.

Now that is worrying.

For sure. And I only put that option in as a laugh!

jimbobaloobob

Thanks touts I'll take note of that advice

ygolometsipe

the colours on the poll are confusing

Those saying it can't happen again because it's not credit fuelled are over confident.

If 10-30% unemployment hits Ireland with droves going abroad again you bet it's gonna tank.

What could possibly cause that?... well...

Protectionist trade war.
Brexit
**** know what Donal Trump will do next.
the full effect of the new usa tax bill I.e low corporate tax.
A supprise or multiple supprise ECB interest rates to control un-expected inflation.
Lower growth in the UK even without brexit.
Possible financial collapses in either or all off
- fake billion dollar Chinese companies listed on USA exchanges through reverse acquisitions.
- drevitives market collapse.
- roll back of frank-dodd act consequences.
The potential collapse of the EURO/EU due to nationalism / migrant crisis / CCCTB.
Down turn in the global economy.
Passing of CCCTB.
Potentially a massive rise in automation.
UK builders entering the Irish market in large numbers due to the collapse in property their...
Vulture funds taking their profits and leaving.
Nama dumping more property onto the market.

The list is long very long... so buy what you can afford to live with. Nothing goes up forever except space.

I just wish they would ban banks from advertising like other unhealthy **** like tobbaco.

badboyblast

Who actually couldn't give a flying F@@k....???. Why wasn't that an option

wonderwall900

Solomon Pleasant wrote: »

9% of people have so far voted for there never being a bust again.

Now that is worrying.

And almost as worrying as the fact that the leading option right now is "5 - 10 years from now"



I think it'll be a lot sooner than that

wonderwall900

badboyblast wrote: »

Who actually couldn't give a flying F@@k....???. Why wasn't that an option

You mustn't live in Ireland so.

Ulysses Gaze

Remember

1. Ireland is different

2. The Fundamentals are sound

badboyblast

wonderwall900 wrote: »

You mustn't live in Ireland so.

I do but what does the value of it mean to a person who lives in a house and is happy , you only care about how much your house is worth if you are treating it like an investment.

Isn't there much better things to invest in.... Where in the world would you see people borrow money to invest in something yet the Irish are obsessed with borrowing money to gamble on property , would you borrow from the bank and go to paddy power and bet it , that is essentially what people are doing .

Enjoy life a little , fix your mortgage for ten years

Marty Bird

wonderwall900 wrote: »

And almost as worrying as the fact that the leading option right now is "5 - 10 years from now"



I think it'll be a lot sooner than that

What are you basing this on? I think the big difference now is that it’s a supply issue cheap credit is no more and remember over 50% of the all property transactions are cash buyers still.

super_furry

It won’t be a sudden crash, it’ll be a gradual levelling out and then a slow drop back as suply catches up with demand. Could take a long time for that though, but thankfully the current lending rules mean that things won’t go too mental and I’d suggest that prices are already at the top now.

6541

The crash happens tomorrow, when i sober up and my alarm goes off !

jimbobaloobob

jimbobaloobob wrote: »

But will they only buy elsewhere if the jobs are elsewhere ? Can't see people buying further and further away from Dublin and being content to commute

Rents around the country are on the up and up so demand is tight for buying nationwide.
What would burst a tech bubble?

And should the jobs go elsewhere? Companies are going to get annoyed that they can't find accommodation for their employees, Dublin transit is a mess, and the cost of living in Dublin is pretty hefty. Companies are already likely seeking alternatives, and hopefully they're looking at another Irish city than leaving the country. Other cities don't have the infrastructure (yet) to attract these businesses, so.. maybe we might get a different kind of crash.

ChikiChiki

Deleted User wrote: »

And should the jobs go elsewhere? Companies are going to get annoyed that they can't find accommodation for their employees, Dublin transit is a mess, and the cost of living in Dublin is pretty hefty. Companies are already likely seeking alternatives, and hopefully they're looking at another Irish city than leaving the country. Other cities don't have the infrastructure (yet) to attract these businesses, so.. maybe we might get a different kind of crash.

Yeah, we will take a massive hit if the EU continue to push the tax harmonisation agenda and suceed. For reasons stated MNCs would be up and out overnight.

andekwarhola

As said, uness something catastrophic happens like a flight of MNCs, I'm not sure the fundamentals are the same as the last time. Our house has only just excedeed the price we paid for it after 13 years. People that got mortgages this time around have been relatively assessed on income and stress tested.

Housing is probably always going to relatively expensive in Dublin, as it's a captial city with a high standard of living and a poor approach to utilizing city space properly for housing (unused land, poor public transport, nimby refusal to go high-rise etc).

VinLieger

super_furry wrote: »

It won’t be a sudden crash, it’ll be a gradual levelling out and then a slow drop back as suply catches up with demand. Could take a long time for that though, but thankfully the current lending rules mean that things won’t go too mental and I’d suggest that prices are already at the top now.

This is exactly what will happen

Ray Palmer

I think the obsession with next crash is funny. People experienced a crash and then believe it will always happen. Ask them to name the property crash in Ireland before 2007 and they can't tell you.
The boom /bust cycle is not an inevitability and doesn't happen all the time or at the level it did last time.
The market has changed in Ireland forever due to the actual crash. Prices rose very heavily for a while and when the crash happened they did not go all the way back down. Even after the crash I saw a house for sale for 100% more than it had 15 years earlier. People who were unable to buy during and after the boom cannot buy a house due to their age. That made the requirement for rental permenantley jump up. Some people will never own now. Supply is not going to meet demand for at least 5 years. If prices drop wait till you see the housing crisis then and a few years after that it will get worse again.

super_furry

https://www.rte.ie/news/business/2018/0620/971871-cso-population-figures/

The population is going to grow until 2051 and with no sign of supply catching up with the demand that’s already there, there’ll be no dramatic drop in prices anytime soon.

wonderwall900

Ulysses Gaze wrote: »

Remember

1. Ireland is different

2. The Fundamentals are sound

I read that in the voice of Father Ted

seamus

"Bust" would be too strong a word. We likely won't see a crash like 2009 again in our lifetime unless the same runaway building and lending is allowed to occur.

As has been said above, as supply ramps up to start meeting demand, prices will start to flatten out. Lending rules have already caused something of a ceiling in prices because people can't borrow any more. This is a good thing long-term, even though painful for those trying to buy.

Remember that inflation means that wages go up, so static house prices while you have positive inflation means that prices are actually dropping in real terms.

That means that your €150k apartment in Tallaght looks unreasonable and expensive now, but when it's still €155k ten years from now, it will actually be reasonable because your average wage is now €60k.

In the short-term there may be a correction at the lower end of the market as supply comes online - although there's a ceiling, that doesn't stop properties from being overpriced. So someone may not be able to borrow enough for the €550k 4-bed, but they can get €450k together for a 3-bed and outbid everyone else who was looking to buy it for €350k. The means the value of low-end properties ends up inflated, while mid-market ones aren't.

But any correction won't be huge, certainly not the 50% drop we saw. Maybe 10-15% at the bottom end; the overpriced 1-beds and sh1tholes. But overall it'll be gradual.

doolox

If Angela loses power through a collapse in her coalition it is possible an election will take place, putting closed border parties in power.

Germany could leave the EU, spelling disaster for the rest of the alliance, France and Italy already have a strong eurosceptic element in their political mix, as does Belgium and Holland.

If these core countries abridge the free movement of people and isolate themselves within the EU the whole thing will collapse leading to different currencies, restricted labour and restricted money movement and chaos for all.

Ireland will become a doubly isolated Atlantic Isle, dear oil and dearer flights and sailings will make it more so. Our nearest neighbour will already be poorer than it is now. It is already poorer per capita than us. People and foreign capital will leave the now irrelevant and isolated and unattractive Island for a more attractive location. It is possible that all the plum jobs will revert to the bigger countries and the US which will have a stronger whip hand in bargaining with 27 different and arguing countries when doing trade deals.

If we cannot keep population growth up, retain more of our own skilled workers and attract and retain more foreign workers and keep construction standards and skills and costs up then houses will cost less and prices will not go up as high as they have been rising now. One thing in favour of maintaining prices is dearer oil as energy is a big input into construction.

SEPT 23 1989

Ulysses Gaze wrote: »

Remember

1. Ireland is different

2. The Fundamentals are sound

3. We are an island

The Bishop Basher

If we do have another crash, how will the government raise the tax take

We're already maxed out from the emergency budget measures brought in during the last crash.

We're now being told yet again that we won't get anything back in the next budget.

Those of us that pay the most get practically nothing back for the tax we do pay. We already pay again for these services so it's not like they can start charging us a third time.

Our public service remains untouchable with regard to productivity and efficiency measures.

So where will they find the cash when the next one hits ?

Ubbquittious

Hopefully soon. Would be nice to see the Dublin landlords living the high life in Feurteventura squirming again

tom1ie

kala85 wrote: »

What's going to make it crash

As Europe recovers the interest rates will go up. They can’t go down cause they’re effectively at 0% as it is. When rates go up this is going to put a lot of pressure on mortgage owners and those in debt with credit cards etc. this could lead to the next big crisis.
If rates go up and people can’t get mortgages due to stress tests on the mortgages, that means people can’t buy houses. This could happen at the exact time a large amount of housing is coming on stream. This potentially could lead to a collapse of house prices.

WARNING THE ABOVE COULD BE ABSOLUTE BULL****.

Your Face

I'm buying a camper van.

VinLieger

Rennaws wrote: »

If we do have another crash, how will the government raise the tax take

We're already maxed out from the emergency budget measures brought in during the last crash.

We're now being told yet again that we won't get anything back in the next budget.

Those of us that pay the most get practically nothing back for the tax we do pay. We already pay again for these services so it's not like they can start charging us a third time.

Our public service remains untouchable with regard to productivity and efficiency measures.

So where will they find the cash when the next one hits ?

We are nowhere near fully maxed out as the vast majority of workers still pay no income tax due to how badly our brackets are set.

Ironically USC is the fairest and best tax weve implemented in a long time that really broadens the tax burden yet its the one first on the chopping block.

I think like many that feel similarly in the squeezed middle dont mind not getting anything back this budget HOWEVER i dont want to see any social welfare increases either. We need to be spending on infrastructure and housing and like you mention wholesale reform and accountability for the public and civil services so we start getting bang for our buck in that sense.