Affordability of Property and Irish Wages/Salaries

Amirani

Flying Fox wrote: »

Does everyone's friends keep them regularly updated on exactly what salaries they're on? In my group this would not be discussed, though obviously you can make a guess based on what the job is.

Plenty of people with good qualifications and experience are on or around the average salary of 35k. There aren't enough of these amazing tech jobs with huge salaries and stock options to go round.

Standard graduate salary in tech, consultancy and most of finance in Dublin is in the 30-35k range. I've worked in a couple of these areas and have interviewed people for graduate level roles. The top level grads will be getting more, but this is a small portion of the total.

Couple of years of work and you should be hitting 40k. People have muddled things up earlier; "recently qualified accountant" does not mean a graduate accountant, it's an accountant that's graduated from college and been working for an accountancy firm for at least 3 years probably whilst doing exams. Only then will they be earning the 60k+ salaries that were referenced earlier.

Samuel T. Cogley

beaz2018 wrote: »

Because this is one of the major incentives for people (teachers/nurses etc) to move back to the country - their salary is worth far more than in Dublin

Any allowance would be a fraction of the actual cost of living in Dublin.

Cyrus

Samuel T. Cogley wrote: »

Any allowance would be a fraction of the actual cost of living in Dublin.

exactly it would still make more sense to be elsewhere but at least it wouldnt be unfeasible to live in dublin which people will do for various reasons

Cyrus

Cyrus wrote: »

its also easy to make excuses

I'm not making excuses, some people manage to overcome crappy circumstances but there are many who struggle. Do they not deserve a decent home? Do they deserve to be looked down on?

You seem to believe that everyone has equal access to the same opportunities, and that's quite simply not the case.

tigger123

Any chance we could redirect the conversation towards the Property Market in 2018?

Asking for a friend.

Pussyhands

What a boring thread the last 10 pages or so. Shares are not driving up prices.

This type of **** is what drives people away from boards. I'm tempted to unfollow this thread.

Samuel T. Cogley

How long do we reckon apartments will continue their skyward* trend?

*at least in terms of price.

Cyrus

Flying Fox wrote: »

I'm not making excuses, some people manage to overcome crappy circumstances but there are many who struggle. Do they not deserve a decent home? Do they deserve to be looked down on?

You seem to believe that everyone has equal access to the same opportunities, and that's quite simply not the case.

im not looking down on anyone, and it depends on what your definition is of a decent house, as ive said before everyone cant have what everyone else wants.

Amirani

tigger123 wrote: »

Any chance we could redirect the conversation towards the Property Market in 2018?

Asking for a friend.

The income people are making clearly has a direct impact on property prices.

Incomes have been relatively stagnant the past few years, but there does seem to be some upward pressure on them now, which may feed into prices.

LirW

Samuel T. Cogley wrote: »

How long do we reckon apartments will continue their skyward* trend?

*at least in terms of price.

They'll just take a turn for the worse when you sell yours :pac:

Samuel T. Cogley

LirW wrote: »

They'll just take a turn for the worse when you sell yours :pac:

That is the one absolute guarantee I can give anyone about the property market.

Bob24

Samuel T. Cogley wrote: »

How long do we reckon apartments will continue their skyward* trend?

*at least in terms of price.

I don’t dare giving you any detailed prediction; too scared of being held accountable if it turns out to be wrong and leads to a bad decision!

(But while I won’t give any timeline or figure I think like houses the only think stopping the rise will be affordability ceilings and - assuming we don’t have an economic crisis - there still is some margin for progress as people who originally wanted a house compromise and go for a cheaper apartment in the same area)

tom1ie

Cyrus wrote: »

Another like bait post, good lad, well done

Please point out any post where i "went on about how great my salary was"?

also the thread is property market 2018, not the cheap houses for all thread, so ill discuss any aspect of the property market that interests me thanks all the same.

Finally, the CB rules are there to ensure people dont mortgage themselves to the hilt and i would strongly argue for their retention, unless you want a house for free so you dont need a mortgage at all?

Can you point out the part where I said a free house for all?

Your one of these fellas that only does extremes.
You can either afford it or your not working hard enough.
If someone brings a different point of view to an argument you use the extreme version of their argument against them.

My argument is that cb rules are being ignored. I know plenty of couples on 40k plus 40k with kids who have been offered mortgages off 400k. That’s against the cb rules. People are getting in over there heads with debt especially when interest rate rises are factored in.
Who will end up paying if these people default? The tax payer, through higher taxes which will be used to shore up bank debts yet again.
But don’t worry you go ahead and bury your head in the sand with your, I’m alright jack attitude.

Cyrus

tom1ie wrote: »

Can you point out the part where I said a free house for all?

Your one of these fellas that only does extremes.
You can either afford it or your not working hard enough.
If someone brings a different point of view to an argument you use the extreme version of their argument against them.

My argument is that cb rules are being ignored. I know plenty of couples on 40k plus 40k with kids who have been offered mortgages off 400k. That’s against the cb rules. People are getting in over there heads with debt especially when interest rate rises are factored in.
Who will end up paying if these people default? The tax payer, through higher taxes which will be used to shore up bank debts yet again.
But don’t worry you go ahead and bury your head in the sand with your, I’m alright jack attitude.

you have no idea what kind of fella i am :P

There are exemptions to the CB rules but they aren't being ignored, i don't think there is any tangible evidence that they aren't being enforced and most people also accept they are keeping a lid on prices.

So you are the one take one extreme example and using that as proof that the CB rules don't work. Self awareness isn't a strength i take it.

thebsharp

There's a wider context here about how we develop places for people to live.

We could (a) let the market drift upwards in terms of affordability. This creates inner city suburbs full of accountants and IT Professionals (or a small number of other specific professions), both adults working 50+ hours a week. What you'll end up with is somewhere pretty bland and i'd be hesitant to set up any kind of services or retail business here as there's limited day trading.
(b) Develop areas with a mix of affordability in mind. This creates a vibrancy due to people having different working patterns, societal functions, outlooks, more free time to spend money during the day etc.

The above issue is replicated across plenty of other cities and, ironically enough, the young professionals end up heading to outerlying suburbs for their social life. Places needs a mix of people to prosper and attract day to day business. Dublin is still pretty small so this is in the longer term.

I think there was a comment earlier about peoples lack of ambition that results in them not earning big money. Serious lack of understanding there about people making career choices based on their values, creative abilities and natural interests. Plenty of our young talent can easily follow the career paths being spoken about but choose not to, and often for the greater good. We need our young talent to be able to continue choosing a variety of paths. Giving them the opportunity for a house within the M50 belt will help support this choice.

.

Mickiemcfist

So ehmm....that 2018 property.....

Any chance of a separate thread arguing over salaries. Lots of people make a lot of money in Ireland, lots don't. That pretty much sums up the past 7 or so pages of waffle.

Cyrus

Mickiemcfist wrote: »

So ehmm....that 2018 property.....

Any chance of a separate thread arguing over salaries. Lots of people make a lot of money in Ireland, lots don't. That pretty much sums up the past 7 or so pages of waffle.

https://www.boards.ie/vbulletin/showpost.php?p=108333180&postcount=2558

Cyrus

thebsharp wrote: »

There's a wider context here about how we develop places for people to live.


(b) Develop areas with a mix of affordability in mind. This creates a vibrancy due to people having different working patterns, societal functions, outlooks, more free time to spend money during the day etc.



.

how do you achieve this?

thebsharp

I'm following about 30 suburbs on Daft/MyHome in South Dublin within the M50 corridor, from Rathfarnham across to Dalkey, range of 400,000 to 550,000.

Generally anything within 1km of Luas, N11 or DART shifts pretty quickly and goes at or above asking. Everything else is taking months to shift and plenty of price drops happening, granted many of them looked over priced to begin with. Been to a good few open viewing and there's very few people at them.

wersal gummage

tom1ie wrote: »

I know plenty of couples on 40k plus 40k with kids who have been offered mortgages off 400k. That’s against the cb rules. People are getting in over there heads with debt especially when interest rate rises are factored in.

To be honest, I don't really believe this.

That is 5x income. Is the exception up to 4.5x?

On 80k with kids (plural), I don't see banks giving 5x salary. If anything, those people may even struggle to get the 3.5x when you factor in childcare and stress testing.

Finally, I think it's unusual that you know plenty of couples on a combined 80k who have all got 5 times their income as a mortgage. Just seems very unlikely.

thebsharp

Cyrus wrote: »

how do you achieve this?

For new developments it's about pre-determining the mix of social, affordable, and full price dwellings during the planning process. All recent SDZs have this and any government led redevelopment will include it. For example, if the recently announced 'Land Development Agency' actually build anything we'll see it too.

I hold both sides of the argument in my head. Why should someone get a helping hand to live in an area I'd like to live, when I don't. However, not providing these options leads to bigger societal issues down the line so i think i'd prefer the first option.

tom1ie

wersal gummage wrote: »

To be honest, I don't really believe this.

That is 5x income. Is the exception up to 4.5x?

On 80k with kids (plural), I don't see banks giving 5x salary. If anything, those people may even struggle to get the 3.5x when you factor in childcare and stress testing.

Finally, I think it's unusual that you know plenty of couples on a combined 80k who have all got 5 times their income as a mortgage. Just seems very unlikely

Ok so when I say plenty I know of 3 couples with kids who are in this situation. So if I know 3 I’m extrapolating this and assuming there are more.

I can’t see any good coming of people mortgaging themselves to the hilt, as they have no other option.
The contraction of the private rental sector is a disaster at the minute. We need more landlords offering accommodation, to drive down rental prices and thus take the pressure off the house purchasing market.
If people know they have a long term affordable tenancy, they will be less inclined to take on such a large mortgage and spend more time saving up a larger deposit for a house, hence not needing a 90% mortgage that leaves them exposed to interest rate increases.

Cyrus

thebsharp wrote: »

For new developments it's about pre-determining the mix of social, affordable, and full price dwellings during the planning process. All recent SDZs have this and any government led redevelopment will include it. For example, if the recently announced 'Land Development Agency' actually build anything we'll see it too.

I hold both sides of the argument in my head. Why should someone get a helping hand to live in an area I'd like to live, when I don't. However, not providing these options leads to bigger societal issues down the line so i think i'd prefer the first option.

Maybe that makes sense for the city centre, but i dont see the suitability of this model in the suburbs where a lot of the relevant points you make arent as applicable.

For example putting two social houses in an infill development of 20 houses in blackrock or somewhere doesnt make sense to me. (although the developers generally get around with the contributions)

TimeToShine

I don't think the discussion on salaries is at all irrelevant to be honest. I've noticed that a lot here already own houses in which case it may be enjoyable to speculate based purely on prices and boom bust cycles. However many of us here are actually in the middle of this mess hoping to buy (20s/30s, professionals, no kids etc) and we use threads like this to gauge public perception and various other relevant factors. I mean to whom could a thread entitled "property market 2018" possibly be more relevant than those who are in the market to buy? And to be frank there seems to be a lot of kicking the can down the road and "tough ****e" vibes coming off a few people. Funnily enough once the once topic shifted to salaries and started to highlight how hopeless matters are for the buying population only then did everyone start clamoring to get "back on topic". According to some here my masters in electrical eng from a top university plus years experience both here and in the US means I "haven't worked hard enough" to be within range of this €100k + €20k benefits salary that is seemingly so common place amongst finance and tech professionals who are 5-7 years out of college (who also happen to have coupled off!). If that's the case then I am in the wrong thread, housing market and probably country.

Graham

Mod Note

Here's a better idea folks. As there's much interest in discussing Irish Property/Salaries, I've moved the discussion into its own thread (this one).

Discuss away.....

Lumen

It really doesn't matter how many people you know on salary of whatever, what matters in a housing market is actual statistics.

And the specific statistics that matter are not how much people earn. Because we have something like 2.3m workers in this country, and yet only 3200 mortgage approvals a year. So only 0.14% of people are getting mortgage approvals each year. What the other 99.86% are earning doesn't matter very much.

edit: "3200 mortgage approvals a year" is way off. They are monthly stats. FAIL!!! /edit

OMG, what if that was the richest 0.14% of the workforce??!?!?

But it isn't, according to the BPFI Mortgage Approvals Report.

https://www.bpfi.ie/publications/bpfi-mortgage-approvals-report/

What does it tell us?

FTB mortgage approvals: €428m across 1,957 mortgage approvals. So €219k on average.
Mover purchase approvals: €328m across 1,249 mortgage approvals. So €263k on average.

These are national averages. We don't get any further breakdowns. It would be nice to see some deciles in that, but we they're not published.

Nonetheless, I see no evidence that there is some massive cohort of people borrowing 700k on combined salaries of 200k a year.

And there can't be thousands of young single renters earning six figures, because if there was they'd be pushing up approval values far higher than 219k.

Why is the mortgage approval value so low compared to selling prices? Apartments? Bank of mummy and daddy? Investors? I don't know.

Cyrus

Lumen wrote: »

It really doesn't matter how many people you know on salary of whatever, what matters in a housing market is actual statistics.

And the specific statistics that matter are not how much people earn. Because we have something like 2.3m workers in this country, and yet only 3200 mortgage approvals a year. So only 0.14% of people are getting mortgage approvals each year. What the other 99.86% are earning doesn't matter very much.

OMG, what if that was the richest 0.14% of the workforce??!?!?

But it isn't, according to the BPFI Mortgage Approvals Report.

https://www.bpfi.ie/publications/bpfi-mortgage-approvals-report/

What does it tell us?

FTB mortgage approvals: €428m across 1,957 mortgage approvals. So €219k on average.
Mover purchase approvals: €328m across 1,249 mortgage approvals. So €263k on average.

These are national averages. We don't get any further breakdowns. It would be nice to see some deciles in that, but we they're not published.

Nonetheless, I see no evidence that there is some massive cohort of people borrowing 700k on combined salaries of 200k a year.

And there can't be thousands of young single renters earning six figures, because if there was they'd be pushing up approval values far higher than 219k.

Why is the mortgage approval value so low compared to selling prices? Apartments? Bank of mummy and daddy? Investors? I don't know.

To be fair , and I understand it’s the only data available, but without regional breakdowns it’s pretty useless

And I don’t think there is a massive cohort borrowing 700k but they are there , think of developments like Proby square , marinella , broad lands, someone is buying them

Lumen

Cyrus wrote: »

To be fair , and I understand it’s the only data available, but without regional breakdowns it’s pretty useless

And I don’t think there is a massive cohort borrowing 700k but they are there , think of developments like Proby square , marinella , broad lands, someone is buying them

I think there's a kind of psychological blindness to sectors of the market that people aren't personally interested in.

Like the stereotypical South Dublin fixation. I can find you a nice secondhand house in D15 for well under 400k, but if you're after a new build in D14 that may as well be an igloo on the dark side off the moon.

Debtocracy

There’s a misperception online that the average young city professional is on 80k and that professionals marry other professionals so a 160k combined income isn’t that uncommon.

I think this misperception is due to a number of reasons:

Boards is over-represented with techy people, the industry sector with the best incomes
We tend to hear about people on good salaries and not hear about people on **** salaries
We tend to underestimate the reduced level of labour participation of women as they age
The number of single people in their 30s is growing rapidly

So people get a sense of an inflated average based on biased sampling and the availability heuristic.

When you look at the objective data there just isn’t enough high income, professional couples to explain price increases in Dublin. What drives up prices here is investments by the older, rich generation and investment funds. Prices are driven by supply and demand and the top 1% with about 33% of the total money supply will exert an abnormally large influence on prices.

To contrast, I’ve known of few suburbs of cities in the West of the country where the housing estates are made up of a lot of young professionals. Yet house prices seem very fair. The rich just aren’t as interested in these places so when it’s left to professional couples competing between themselves, houses tend to be reasonably priced.

LirW

Personally all couples I know work in different fields with very different salaries. I'd be in the around 30-age group and so are my friends. Out of all of them only one person grosses money in the bracket some people see as absolutely normal in that age. And he's coupled up with a lady since they're teenagers that earns a third of his take home pay.
What stands out is, since a lot of these people went to school together at some point and would all be middle class kids, is that in yer man's case he comes from a wealthy background, went on to visit a very prestigious private secondary and had all his education in prestigious institutions paid for by his parents.

Most are still having degrees but work in highly competitive fields with average salaries and the pay often stays quite average.

The examples named earlier in the thread are simply not representative for this generation of buyers. They do exist, not questioning that but it's not the average.
Many people I personally know can't really afford buying in Dublin unless they'd move to really crappy areas (proper anti-social havens) and myself and my partner are no exception of that.

You can just try making the best out of it and move on with your life.
Some people are in a situation where it makes a lot of sense not putting buying off much longer and in such a pressure of a marker you literally buy everything you can afford that's somewhat suitable for long-term needs.
I said it before, there are plenty of threads opened by people that struggle to find anything affordable remotely close to where they work.

It's certainly not a buyer's market at the moment.