Property Market 2019

The_Conductor

super_furry wrote: »

Get on the blocks and get ready to apply for those exemptions on January 1.
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Plenty of exemptions still out there- BOI 100% definitely have them- not sure about other lenders- but they are still to be gotten...…...

Mic 1972

super_furry wrote: »

No changes to the mortgage lending rules from the Central Bank today.

Thank god for that, we do not need another bubble

Sloppy_Joe

super_furry wrote: »

I mean I get it for people that are stuck, but the lending rules are working as intended.

the report says: "Without the restrictions, the Central Bank estimates that house prices this year would been 15% to 25% higher than they currently are."

The rules protect the banks, and screw every single non property owner.

If we have another crash like we did, then people are going to be losing their jobs, emigrating etc. anyways and prices are going to crash.

If I get a mortgage for 90% and 3.5x my salary and then next year I lose my job, who pays my mortgage? How do these rules protect me?

I hope the central bank realises this policy is making every young renters lives miserable and will effect them for the rest of their lives as they pay out tens of thousands in rent that should be in their pocket.

If the central bank was doing it's job properly in 2007 and previous things wouldn't be half as bad. But no, we all have to suffer because of some w@anker bankers.

Bluefoam

Sloppy_Joe wrote: »

The rules protect the banks, and screw every single non property owner.

If we have another crash like we did, then people are going to be losing their jobs, emigrating etc. anyways and prices are going to crash.

If I get a mortgage for 90% and 3.5x my salary and then next year I lose my job, who pays my mortgage? How do these rules protect me?

I hope the central bank realises this policy is making every young renters lives miserable and will effect them for the rest of their lives as they pay out tens of thousands in rent that should be in their pocket.

If the central bank was doing it's job properly in 2007 and previous things wouldn't be half as bad. But no, we all have to suffer because of some w@anker bankers.

20% of €350,000 is €70,000.. thats how much more a house would cost you, either in savings or by mortgage. You would needd to come up with that. And that only accounts for this year... not the year on year increases from now till infinity...

SozBbz

Sloppy_Joe wrote: »

If I get a mortgage for 90% and 3.5x my salary and then next year I lose my job, who pays my mortgage? How do these rules protect me?

I hope the central bank realises this policy is making every young renters lives miserable and will effect them for the rest of their lives as they pay out tens of thousands in rent that should be in their pocket.

If the central bank was doing it's job properly in 2007 and previous things wouldn't be half as bad. But no, we all have to suffer because of some w@anker bankers.

They protect you from yourself. They protect you from property prices that could be up to 25% higher if the rules were not in place.

How can you in the same post complain that the rules are too restrictive and yet ask who would pay your mortgage should you default? Loans carry risk, thats the real world.

Nothing protects you from world economic forces. Nothing protects you from losing your job.

Everyone knows the Central Bank was worthless pre 2007 but thats nothing to do with todays lending rules.

Kamili

I don't think the issue is the lending rules - they are working. The issue is lack of supply - which is nothing to do with the central bank.

Relax the lending rules - and people will just end up paying more and more until the supply issue is resolved. This government has no appetite to tackle the supply issue and is confounding it by allowing public housing compete against properties in the private market, again pushing up prices.

That and a miriad of other issues...


The lending rules need to be in place.

Sloppy_Joe

Bluefoam wrote: »

20% of €350,000 is €70,000.. thats how much more a house would cost you, either in savings or by mortgage. You would needd to come up with that. And that only accounts for this year... not the year on year increases from now till infinity...

People are paying 15k a year for the equivalent of what they'd be able to buy.

Rent for 5 years, not even taking into account the 4% annual increase, and you'd have that 70k well paid off by not throwing it away on rent.

It's a scandal what is happening.

And what's worse is that people think we can build our way out of the problem while population growth dwarves the number of houses being built.

Sloppy_Joe

SozBbz wrote: »

They protect you from yourself. They protect you from property prices that could be up to 25% higher if the rules were not in place.

How can you in the same post complain that the rules are too restrictive and yet ask who would pay your mortgage should you default? Loans carry risk, thats the real world.

Nothing protects you from world economic forces. Nothing protects you from losing your job.

Everyone knows the Central Bank was worthless pre 2007 but thats nothing to do with todays lending rules.

The rules protect the bank from losing money.

The rules do nothing differently for home owners if the same thing happens as in 08.

Kamili

Sloppy_Joe wrote: »

And what's worse is that people think we can build our way out of the problem while population growth dwarves the number of houses being built.

so don't build anything then, what happens? Relax the mortgage rules too, explain to me what happens then?

whats your solution to the issue?

Sloppy_Joe wrote: »

The rules protect the bank from losing money.

The rules do nothing differently for home owners if the same thing happens as in 08.

The rules were put in place to stop what happened in 2008 happening - how can you not see that?

alwald

Sloppy_Joe wrote: »

People are paying 15k a year for the equivalent of what they'd be able to buy.

Rent for 5 years, not even taking into account the 4% annual increase, and you'd have that 70k well paid off by not throwing it away on rent.

It's a scandal what is happening.

And what's worse is that people think we can build our way out of the problem while population growth dwarves the number of houses being built.

This is is not the fault of the CBI or its lending rules but rather this useless government and its policies in relation to housing/rental market.

The role of the CBI isn't to build houses, help you buy a house or make decisions linked to the rental market...its role is to protect the soundness of the Irish financial market at all levels.

Your complaints are legitimate but they should be directed to Leo and Eoghan not the CBI.

SozBbz

Sloppy_Joe wrote: »

People are paying 15k a year for the equivalent of what they'd be able to buy.

Rent for 5 years, not even taking into account the 4% annual increase, and you'd have that 70k well paid off by not throwing it away on rent.

It's a scandal what is happening.

And what's worse is that people think we can build our way out of the problem while population growth dwarves the number of houses being built.

There is nothing wrong with expecting people to pay for a roof over their heads. Rents are high, granted, but what are you suggesting, other than just spouting tropes such as "its a scandal".

And yes, we can build our way out of the issue, but building needs to be increased and not all private sector.

SozBbz

Sloppy_Joe wrote: »

The rules protect the bank from losing money.

The rules do nothing differently for home owners if the same thing happens as in 08.

The rules actually reign in what the banks are allowed lend and actually limit their profits.

How are lending rules in a small open economy supposed to protect people from a worldwide economic crash?

With respect, you don't know what you're on about. You're conflating issues and making little sense.

mollser

alwald wrote: »

Your complaints are legitimate but they should be directed to Leo and Eoghan not the CBI.

... or Nimby's, or councils, or planning departments etc...

JJJackal

Sloppy_Joe wrote: »

The rules protect the banks, and screw every single non property owner.

If we have another crash like we did, then people are going to be losing their jobs, emigrating etc. anyways and prices are going to crash.

If I get a mortgage for 90% and 3.5x my salary and then next year I lose my job, who pays my mortgage? How do these rules protect me?

I hope the central bank realises this policy is making every young renters lives miserable and will effect them for the rest of their lives as they pay out tens of thousands in rent that should be in their pocket.

If the central bank was doing it's job properly in 2007 and previous things wouldn't be half as bad. But no, we all have to suffer because of some w@anker bankers.

If I get a mortgage for 105% and 10x my salary and then next year I lose my job, who pays my mortgage? How do these rules protect me?

Thats how the rules protect you - you cant

There is no specific rule the Central Bank can introduce to prevent an individual losing their jobs and running into financing difficulties. We need to be realistic about what they can do

The rules should also protect the banks. If there were no banks there would be no access to money for individuals and companys.

OEP

So they relax the rules by x% - house prices go up by x%. You're in the exact same position as before but when you do eventually have the money to buy the house, your mortgage repayments are higher.

I'm sorry but it's idiocy to think that relaxing the limits is a good thing

alwald

The real question I am asking myself is in relation to next year's GE, and whether any party, apart from FG who are useless, can deliver solutions to tackle this mess (Affordable housing, increase the supply,...).

Bluefoam

alwald wrote: »

The real question I am asking myself is in relation to next year's GE, and whether any party, apart from FG who are useless, can deliver solutions to tackle this mess (Affordable housing, increase the supply,...).

In theory that was the role of Labour... but they alse have a reputation for negatively effecting the economy and the wealth of the citizens...

So, while more people get socialist houses at the begining, the ability to maintain that is not so good & eventually the people vote for a more capitalist system. It's a cycle.

I'm a socialist at heart, but that doesn't include giving lazy useless ****ers free houses.

Mickiemcfist

Sloppy_Joe wrote: »

The rules protect the banks, and screw every single non property owner.

Ehhh property owners & banks would only love the rules to be removed.

If the rules are removed the banks will lend more money & homeowners will have more "equity" in their houses as the entire market will go up in value, the only losers in the entire process would be people who want to buy a house but havent yet.

riclad

I See no point in relaxing the rules, the rules were ignored after 2000,
then there was reckless lending,the crash, then the bank bailout .
the rules are in place to protect taxpayers and consumers.
Maybe they could be relaxed slightly,
eg borrow 4x times your salary if you are buying a new house, and have 12 per cent deposit saved up.
eg the rules should not be changed re borrowing for non first time buyers
or for buying a old house .
the lending rules protect the taxpayer,s from a boom and bust cycle,
loose rules =higher price,s ,
if there,s a recession prices fall suddenly,
and The banks are at risk of going bust.
if you have a loan of 350k,
on a house thats only worth 190k,
you might be tempted to leave the country .
or stop paying the mortgage.

What we need is more house,s to be built, as well as 1 bed units .
Not everyone needs to buy a 3bed house .
the losers will be single people who wont be able to buy a house for 300k plus.
they will left out of the housing market.

Sloppy_Joe

Kamili wrote: »

so don't build anything then, what happens? Relax the mortgage rules too, explain to me what happens then?

whats your solution to the issue?




The rules were put in place to stop what happened in 2008 happening - how can you not see that?

What happened in 2008 is not attributable to the property market. The property market suffered as a result of the recession.

Sloppy_Joe

OEP wrote: »

So they relax the rules by x% - house prices go up by x%. You're in the exact same position as before but when you do eventually have the money to buy the house, your mortgage repayments are higher.

I'm sorry but it's idiocy to think that relaxing the limits is a good thing

What?

How are you in the same position as before?

The position before is you are paying 15k in rent a year, burning money.

aloooof

Sloppy_Joe wrote: »

What happened in 2008 is not attributable to the property market. The property market suffered as a result of the recession.

I don't see how this is accurate. For example, 100% mortgages were available in 2008. That, in turn with the recession, caused people to enter massive negative equity.

Having the Central Bank rules, along with the 90% LTV rule, is designed to try and reduce that possibility.

Of course the recession contributed too, but to say it's also not at all attributable to the property market is massively inaccurate imo.

cruizer101

So lets say you as a couple are earning 100k currently you can get a mortgage for 350k and purchase house for ~385k based on 10% deposit.
CB change rules so now it is 4.5 multiple.
You can now get mortgage for 450k and buy house for ~495k, assuming you have extra deposit amount.
But so can everyone else, so that house that was priced at 380k has now risen to 490k and you are still in a bidding war with the same people as you would be if rules just stayed the same.
When eveyones purchasing power goes up so does the value of the items they want to buy.

Changing the central bank rules does not magically increase supply.
The only rule I would agree with changing might be the 20% deposit for second time buyers especially if they bought house during boom and ended up in negative equity.

riclad

In 2006 you could borrow 5 or 6 times your mortgage.
ah sure buy a house in longford for 320k,
what could go wrong .
Theres no way prices could fall.

OEP

Sloppy_Joe wrote: »

What?

How are you in the same position as before?

The position before is you are paying 15k in rent a year, burning money.

And you'll still be in that position because although you can get a bigger loan, the house prices have increased at the same rate so you still can't afford it.

So you're still left paying 15k in rent a year. You seem to be making the assumption that relaxing the limits will mean you can borrow more, and house prices remain the same.

wowy

Sloppy_Joe wrote: »

People are paying 15k a year for the equivalent of what they'd be able to buy.

Rent for 5 years, not even taking into account the 4% annual increase, and you'd have that 70k well paid off by not throwing it away on rent.

It's a scandal what is happening.

And what's worse is that people think we can build our way out of the problem while population growth dwarves the number of houses being built.

There's so much wrong with this.

Firstly this notion I see everywhere that renting should be no more expensive than a mortgage - the rental cost of a property should generally always carry a bit of a premium over the notional mortgage cost of a property as renters aren't paying the running costs of the property (mortgage interest, service charge, insurance, repairs, fixtures & fittings, LPT, etc); let alone carrying the risk of voids, rent arrears, bad tenants, etc; and aren't tied to the property and can leave the property at the drop of a hat without recourse from any bank.

Secondly, even if a renter owned their rental property instead of rented it, they won't save €70K in 5 years - the notional amount that they'll save will be the difference in the montly mortgage payment versus the monthly rent, but now they'd also be carrying the running costs of the property themselves. Furthermore, for the 1st few years of a mortgage it's mainly interest that's being paid with each mortgage payment, so this idea that instead of paying €70K rent over 5 years they could simply pay an extra €70K for a gaff at Day 1; if only the pesky Central Bank would let them; and have that capital paid off in those 5 years is, again, nonsense.

alwald

Sloppy_Joe wrote: »

What happened in 2008 is not attributable to the property market. The property market suffered as a result of the recession.

You need to check your facts, the 2008 recession is linked to the subprime mortgage crisis and was caused due to a bad/non existent checks on customers, their affordability...prior to obtaining a mortgage(s).

JJJackal

Sloppy_Joe wrote: »

What happened in 2008 is not attributable to the property market. The property market suffered as a result of the recession.

This statement is blatantly wrong.

Firstly in terms of the cause - see subprime.... Look at all the US lenders who either collapsed or needed state aid prior to Irish problems. This was contagious.

Secondly, the banks in Ireland went bust because the borrowers could not pay back their debts - both builders and house owners.

Or do you think the recession was the cause of everyone borrowing more than they could afford if their wages didnt continue to increase indefinitely and the value of the property didnt continue to rise? Or builders unable to pay their debts if the land they bought at record prices didnt continue to rise in value.

JJJackal

Sloppy_Joe wrote: »

People are paying 15k a year for the equivalent of what they'd be able to buy.

Rent for 5 years, not even taking into account the 4% annual increase, and you'd have that 70k well paid off by not throwing it away on rent.

It's a scandal what is happening.

And what's worse is that people think we can build our way out of the problem while population growth dwarves the number of houses being built.

15 K a year is about a 300,000 euro mortgage over 30 years. After 5 years you will have paid off about 42k of capital and about 45k interest.

On top of that you will have insurance 400*5, property tax*5, potentially management fees*5, if second hand likely some maintenance costs...

People forget the added costs of ownership. There is also the opportunity cost (both of buying and not buying).

Sloppy_Joe

aloooof wrote: »

I don't see how this is accurate. For example, 100% mortgages were available in 2008. That, in turn with the recession, caused people to enter massive negative equity.

Having the Central Bank rules, along with the 90% LTV rule, is designed to try and reduce that possibility.

Of course the recession contributed too, but to say it's also not at all attributable to the property market is massively inaccurate imo.

Do you know what caused the crash? Sub prime lending in the US - lending given to people who have no credit history and are going to fail to pay their loans back.

We have a whole generation paying insane rents - well able to pay a mortgage.

It's not like I'm claiming college grads should be getting 100% mortgages like they were!

Whoever does have a mortgage, if they lose their job they won't be able to pay their mortgage either. So the result on the owner is the same whether its 5x or 3.5x

It's funny that the US did nothing to prevent the same thing happening again over there, so is there going to be another crash???