Almost half of all property sold in 2018 bought with cash or savings!!

Bigmac1euro

What does this mean for the Irish property market exactly ?
Will many of the working class be a slave to the rich ?

https://jrnl.ie/4498981

Zamboni

Bigmac1euro wrote: »

What does this mean for the Irish property market exactly ?
Will many of the working class be a slave to the rich ?

https://jrnl.ie/4498981

It means half needed a mortgage to buy a house and half buy with cash.

No. Slavery is illegal in Ireland.

Zamboni

I remember trying to buy a house with a mortgage and competing against cash buyers. It was bloody difficult as some vendors would prefer the quick and easy transaction regardless of highest offer.
It was a tough gig that took years and eventually patience and constant saving and extra jobs paid off.

Kidkinobe

Im working class and Im about to buy a house with cash...I was never a slave to rich people, I just worked and saved.

Bigmac1euro

Kidkinobe wrote: »

Im working class and Im about to buy a house with cash...I was never a slave to rich people, I just worked and saved.

This is good to know. Fair play that must have taken a long time.

If you don’t mind me asking what age are you ?

Bigmac1euro

Zamboni wrote: »

It means half needed a mortgage to buy a house and half buy with cash.

No. Slavery is illegal in Ireland.

Grand that clears that up then.

Franz Von Peppercorn

It’s a fairly huge number considering that the number of transactions is increasing. Does anyone know the distribution of the sales - more down the country is think.

Kidkinobe

Bigmac1euro wrote: »

This is good to know. Fair play that must have taken a long time.

If you don’t mind me asking what age are you ?

50, I already have one mortgage free home, used a loan to get that and paid it off by 40, Im buying my second one with cash. 10 years of saving and living on the sniff of a rag dipped in butter.

Eric Cartman

Kidkinobe wrote: »

50, I already have one mortgage free home, used a loan to get that and paid it off by 40, Im buying my second one with cash. 10 years of saving and living on the sniff of a rag dipped in butter.

and when do you get around to enjoying life ?

Zamboni

Eric Cartman wrote: »

and when do you get around to enjoying life ?

They were mortgage free by 40. That sounds enjoyable.

Alias G

Eric Cartman wrote: »

Kidkinobe wrote: »

50, I already have one mortgage free home, used a loan to get that and paid it off by 40, Im buying my second one with cash. 10 years of saving and living on the sniff of a rag dipped in butter.

and when do you get around to enjoying life ?

Who says he doesn't enjoy life.

Bigmac1euro

Kidkinobe wrote: »

50, I already have one mortgage free home, used a loan to get that and paid it off by 40, Im buying my second one with cash. 10 years of saving and living on the sniff of a rag dipped in butter.

Impressive.
Kudos.

whiskeyman

Alias G wrote: »

Who says he doesn't enjoy life.

Somedays he may even have 2 sniffs...

Kidkinobe

Eric Cartman wrote: »

and when do you get around to enjoying life ?

Why do you think Im not enjoying life...Finding work you love to do is the key to enjoying life as you spend most of your life working...Not to mention Ive visited more countries than I care to remember, In fact, this time next week Im off again for another 2/3 month trip, I will return when I get bored of it and get back to working 70 hours a week.

Bigmac1euro

Franz Von Peppercorn wrote: »

It’s a fairly huge number considering that the number of transactions is increasing. Does anyone know the distribution of the sales - more down the country is think.

Is this normal though ?

NSAman

Kidkinobe wrote: »

Why do you think Im not enjoying life...Finding work you love to do is the key to enjoying life as you spend most of your life working...Not to mention Ive visited more countries than I care to remember, In fact, this time next week Im off again for another 2/3 month trip, I will return when I get bored of it and get back to working 70 hours a week.

It can be done, but most think you have to follow a traditional route. Luck, hard work and focus play a lot in managing this. Like you 70 to 100 hours a week made it happen. 2nd house bought for cash in Ireland last year.

klaaaz

People are forgetting that some of these sales are to REIT's buying whole blocks of apartments, it skews the numbers. It's not like 50% of individuals are going around with hundreds of thousands in their pockets!

the_syco

klaaaz wrote: »

People are forgetting that some of these sales are to REIT's buying whole blocks of apartments, it skews the numbers. It's not like 50% of individuals are going around with hundreds of thousands in their pockets!

Was about to say this myself.

m5ex9oqjawdg2i

Zamboni wrote:

They were mortgage free by 40. That sounds enjoyable.

I've been mortgage free all my life and it has been fantastic

BarryD2

Kidkinobe wrote: »

50, I already have one mortgage free home, used a loan to get that and paid it off by 40, Im buying my second one with cash. 10 years of saving and living on the sniff of a rag dipped in butter.

What do you want two properties for though? Most people only need one house/ home. If you're speculating, treating is a 'pension' etc etc, won't have much sympathy if it all goes pear shaped.

If people were more reasonable in their expectations, there'd be a more housing to go around, to those who need one house to own & live in.

Mandown

BarryD2 wrote: »

What do you want two properties for though? Most people only need one house/ home. If you're speculating, treating is a 'pension' etc etc, won't have much sympathy if it all goes pear shaped.

If people were more reasonable in their expectations, there'd be a more housing to go around, to those who need one house to own & live in.

Because he can.

Eric Cartman

Alias G wrote: »

Who says he doesn't enjoy life.

The living off a rag dipped in butter comment, which if the posters travel comments are true the clearly that hasnt been the case.

I dont doubt being mortgage free at 40 is great and having 2 houses and no loan at 50 is wonderful , but not if youve had to live like a monk osolated from the world for it, this poster in one way suggested they had, in another suggested that theyre off travelling half the year.

jon1981

Remember all those boom time sales? Well there was a seller on one side of the transaction...the money had to go somewhere, why is it a surprise that cash purchases are so high? Alot of these ppl are entering the market again, some as landlords.

Samuel T. Cogley

Kidkinobe wrote: »

50, I already have one mortgage free home, used a loan to get that and paid it off by 40, Im buying my second one with cash. 10 years of saving and living on the sniff of a rag dipped in butter.

Fecking Plumbers :pac:

jon1981

Alot of boom time money is now being passed down to the next generation. For example I personally know a couple in their mid 30s how bought a 900k home and putting renovation works which are easily upward of 300k.

One is an entry level managers in a big 4... the other is yoga instructor... going by the current banking rules a mortgage of that magnitude would be out of reach without a significant deposit.

An in-laws grandmother passed away, left a big 5 bed in Clontarf to the parents, who then gave the inheritance money to the grandchildren ( 3 of them), that's 1.2m /3 grandkids....

There is a lot of money in the assets held by the older generation.

Kidkinobe

Kidkinobe wrote: »

50, I already have one mortgage free home, used a loan to get that and paid it off by 40, Im buying my second one with cash. 10 years of saving and living on the sniff of a rag dipped in butter.

Butter is inexcusably extravagant. Just think of how quicker you’d have saved up if you’d just used dripping.

Kidkinobe

Deleted User wrote: »

Butter is inexcusably extravagant. Just think of how quicker you’d have saved up if you’d just used dripping.

You got to allow yourself a few finer things in life...its Kerrygold butter too, none of that cheap **** for me..

Graham

BarryD2 wrote: »

What do you want two properties for though? Most people only need one house/ home. If you're speculating, treating is a 'pension' etc etc, won't have much sympathy if it all goes pear shaped.

If people were more reasonable in their expectations, there'd be a more housing to go around, to those who need one house to own & live in.

There would also be no property to rent which would be a bit of a downer.

Kidkinobe

BarryD2 wrote: »

What do you want two properties for though? Most people only need one house/ home. If you're speculating, treating is a 'pension' etc etc, won't have much sympathy if it all goes pear shaped.

If people were more reasonable in their expectations, there'd be a more housing to go around, to those who need one house to own & live in.

Ive got one house in New Zealand where I made my cash from buying and doing up houses and flicking them on or renting them out. They have no CGT there so every cent I made was mine and put right back into the next property, The other house will be here and its a dump with the potential to make it a little goldmine.I intend to follow the summers when I feel like retiring.
And that might explain all my travelling to who ever it was that got a bit upset about it...

Bigmac1euro

Kidkinobe wrote: »

And that might explain all my travelling to who ever it was that got a bit upset about it...

I was cutting onions I swear

LirW

Hardly surprising. While half the buyers go down the classic route of buying by saving up a deposit, getting a mortgage and buy, there are many buyers with different circumstances. People who relocate and downsize with their equity. REITs buying a bundle of units. People coming home from abroad buying with huge cash savings. Inheritance. Lump sums. Shares and investment payouts. Alternative ways of financing.
The statistic merely says that these buyers don't buy with a mortgage.

Marius34

Bigmac1euro wrote: »

What does this mean for the Irish property market exactly ?
Will many of the working class be a slave to the rich ?

https://jrnl.ie/4498981

I think they miscalculated the numbers. They include only FTB and Mover purchase Mortgages as Mortgage (30.6K) and all the rest of Transactions (from 55K in total) as Cash Buyers. That's not right.
I would more rely on BPFI reports:
https://www.bpfi.ie/wp-content/uploads/2018/12/BPFI-Housing-Market-Monitor-Q3-2018-FINAL.pdf

Balf

Franz Von Peppercorn wrote: »

It’s a fairly huge number considering that the number of transactions is increasing. Does anyone know the distribution of the sales - more down the country is think.

There's another analysis here that's broadly consistent, looking at total spend rather than transactions.

Balf wrote: »

Seems to be more than just anecdotal.

https://igees.gov.ie/wp-content/uploads/2019/01/The-Context-for-NDP-Housing-Spend.pdf

Annual housing market spend tripled since 2010, from €5 billion to over €14.5 billion

The €9.5 billion increase is not fuelled by mortgage credit; mortgage drawdowns have increased by only €2.5 billion

Spend is highly concentrated in a few counties, and tends not to connect to new supply

o Dublin and the Mid-East accounts for 64% of spend since 2010
o Second hand market accounts for 80% of spend (€11.8 billion in 2017)
o New housing market accounts for 20% of spend (€2.8 billion in 2017)

Most of the increased demand in recent years is not funded by mortgages.Does anyone really know where the additional demand comes from?

pwurple

It's a feature of middle incomes, to consider property as a type of wise saving and investment, and to think flamboyant consumption is wasteful.

You don't need to spend shedloads to live a great life.

If savings are moving into property, it is a sign that interest rates are very low indeed... Older people want to protect the value and spending power of their life savings., Not have it eroded by inflation.

Glenbhoy

jon1981 wrote: »

Remember all those boom time sales? Well there was a seller on one side of the transaction...the money had to go somewhere, why is it a surprise that cash purchases are so high? Alot of these ppl are entering the market again, some as landlords.

Except that what often happened was:

Ftb buy from trader upper/developer
Trader upper buys from trader upper upper
Trader upper upper buys from downsizer
Downsizer buys from builder and invests excess in blue chip shares (typically banks, Anglo, AIB etc).
Developer buys land from farmer
Farmer invests in blue chip shares
Shares practically worthless

A lot of wealth was destroyed, so the typical winner/loser scenario didn't hold for many transactions.

The above reflects the type of scenario I encountered a lot of over the past decade working in the legal industry, there were a large number of cases centred on the ultimate vendor (farmer/downsizer) suing professional advisors for bad investment advice and a huge amount of cases trying to enforce contracts signed (or about to be signed) just as the bubble burst.

BarryD2

jon1981 wrote: »

Alot of boom time money is now being passed down to the next generation. For example I personally know a couple in their mid 30s how bought a 900k home and putting renovation works which are easily upward of 300k.

...........

There is a lot of money in the assets held by the older generation.

True to some extent but a substantial proportion of those same assets are also feeding the expanding 'end of life' care industry. Nursing homes, 'Fair Deal' schemes etc. Less left to inherit these days.

Sleepy

I'm sure Council & Housing Association purchases count as cash sales too so that would be 10% of all new builds off the top. Add to that second hand stock being purchased by the same, REITs buying entire blocks etc. and you're probably left with the vast majority of the rest being those trading up/down/sideways.

There really wouldn't be that many first-time buyers purchasing for cash.

Nobodysrobots

It's not surprising when you look at how property has performed as an investment, (or a way to safeguard wealth over the long-term) throughout history. There is a lot more money floating around these days, so this trend makes sense to me. There's a reason wealthy people all over the world, usually store a fairly significant portion of that wealth in property. The alternatives (e.g. stock market) are looking particularly risky as we head into times of uncertainty (astronomical US/EU debt levels, Brexit, Asia, etc). It's for another topic but the whole global financial system seems more and more on the brink of implosion as time goes on. If I had any kind of meaningful wealth right now, I wouldn't be leaving it sitting in the bank.

Balf

Nobodysrobots wrote: »

If I had any kind of meaningful wealth right now, I wouldn't be leaving it sitting in the bank.

Yet, that's where it seems to be

https://www.irishtimes.com/business/personal-finance/household-deposits-reach-new-high-of-97-2-billion-1.3728846

Savings by Irish households reached a new high in September 2018, as consumers continued to plough their money into saving accounts despite the record low returns on offer.

Figures from the Central Bank show that deposits rose by €3.3 billion, or by 3.5 per cent, in the year to end-September 2018, pushing deposits up to €97.2 billion, above the Celtic Tiger peak of €94 billion reached in 2009.

€100 billion in cash would pay for a lot of housing; compared to €7.3 billion in mortgage drawdowns in 2017.

Nearly a surprise that more saving aren't being ploughed into such assets.

Nobodysrobots

Balf wrote: »

Yet, that's where it seems to be€100 billion in cash would pay for a lot of housing; compared to €7.3 billion in mortgage drawdowns in 2017.

Nearly a surprise that more saving aren't being ploughed into such assets.

That 100 billion is spread among just under 5 million people, I know some have more and some less but it averages out to just 20k per person. You can't really invest in property at those levels.

Edgware

Kidkinobe wrote: »

Why do you think Im not enjoying life...Finding work you love to do is the key to enjoying life as you spend most of your life working...Not to mention Ive visited more countries than I care to remember, In fact, this time next week Im off again for another 2/3 month trip, I will return when I get bored of it and get back to working 70 hours a week.

It was a stupid, probably jealous, comment from a member of the "world owes me a living" group

Hedgelayer

I bought mine for cash in 2003 nearly doubled in price in 2008 lol
Now it's a bit above what I paid for it.

The great thing about buying in cash is you've plenty of money to play around with.

My partner is buying her house with cash this year, she's lucky to get huge inheritance as well.

We're not married but believe in having our own space and cave's to hide out in now and again.
We'll never get married either and have a kid each from our past.

Living apart is the new living together.

I'm blessed and so is she....

Cuts out all the bull****

NSAman

BarryD2 wrote: »

What do you want two properties for though? Most people only need one house/ home. If you're speculating, treating is a 'pension' etc etc, won't have much sympathy if it all goes pear shaped.

If people were more reasonable in their expectations, there'd be a more housing to go around, to those who need one house to own & live in.

Jesus, what do you get out of bed in the morning for? Or DO you get out of bed in the morning? Some of us want to progress in life and have something for our futures.

If someone works hard, what is wrong with having more than one house? The guy works hard for a living... enjoys what he does and invests his money in ways HE sees fit. He does NOT have to answer to you.

Perhaps if you took a leaf out of his book you may have that first house or even that second house... or like some of us.. several houses in several countries.

Instead of criticising the guy, try and DO something about your perceived lack of progress in life.

Wingman2010

Hedgelayer wrote: »

I bought mine for cash in 2003 nearly doubled in price in 2008 lol
Now it's a bit above what I paid for it.

The great thing about buying in cash is you've plenty of money to play around with.

My partner is buying her house with cash this year, she's lucky to get huge inheritance as well.

We're not married but believe in having our own space and cave's to hide out in now and again.
We'll never get married either and have a kid each from our past.

Living apart is the new living together.

I'm blessed and so is she....

Cuts out all the bull****

I think that’s a great set up you have! I’d love to meet a similar life partner 😊😊

sk8board

Marius34 wrote: »

I think they miscalculated the numbers. They include only FTB and Mover purchase Mortgages as Mortgage (30.6K) and all the rest of Transactions (from 55K in total) as Cash Buyers. That's not right.
I would more rely on BPFI reports:
https://www.bpfi.ie/wp-content/uploads/2018/12/BPFI-Housing-Market-Monitor-Q3-2018-FINAL.pdf

I thought the same. They say 29% nationwide and 17% in dublin commuter belt.

I’ve bought houses for cash in dublin since 2013 and ive come across other competing cash buyers in some instances, not much.

It’s the same with expensive cars - a lot more of them are sold for cash than people think.

No financial help from parents whatsoever (and unless they’re hiding the Pools money, I won’t be either!), but had 15 successful years in software and great share options. The country has a LOT of similar people with similar stories.
Free 3rd level education resulted in all the middle/working class children’s going to college. McWilliams even wrote a book about us

Also, bear in mind with inheritance, when parents live into their 80s+ (V common thankfully!), their children are easily already in their late 40s/50s/60s even, and have their own house pretty much paid off or are near retiring themselves and just pass it down quicker to their own children as FTBs.

Hedgelayer

Wingman2010 wrote: »

I think that’s a great set up you have! I’d love to meet a similar life partner 😊😊

It's better than having to end up on the relationship forum, being left living in heart break hotel and some new jocky in your place....

Zero complications and space is living...