Property Market 2020

pearcider

awec wrote: »

This is not how it works in the real world.

Prices will be driven down because people cannot buy any more, not that they have chosen not to or just all decided to wait.

If it was a case of everyone waiting and then everyone buying then prices would just instantly skyrocket again as demand surges. If you want your bargains then you need a huge number of potential buyers removed from the market for the foreseeable future.

In the real world when people are in a position to buy they will buy. There’s no collective “let’s all just wait.”

That’s actually not true. Investors act like a herd more often than not. Good book on this called the wisdom of crowds.

awec

pearcider wrote: »

That’s actually not true. Investors act like a herd more often than not. Good book on this called the wisdom of crowds.

People buying their home are not investors. There's a big difference.

If it were as simple as everyone waiting, why didn't everyone just wait in 2018? Or 2017? Or any of the recent years where prices have exploded?

Hubertj

schmittel wrote: »

There is certainly anecdotal evidence on these boards that people who were sale agreed 6 weeks ago are wondering whether or not to proceed. Some have mentioned job security, others have mentioned fear of negative equity etc.

Not quite a collective lets all just wait but it won't take much to tip it into that.

Note that some of the “anecdotal” evidence on boards is made up.

hometruths

awec wrote: »

People buying their home are not investors. There's a big difference.

If it were as simple as everyone waiting, why didn't everyone just wait in 2018? Or 2017? Or any of the recent years where prices have exploded?

Because the market was going gangbusters in 2017 and 2018. In a rising market people have a fear that the house they want to buy will be more expensive this time next year, so they try and complete a purchase as quickly as possible.

If people think there is a chance the house they want to buy will be cheaper this time next year they will wait.

A rising market will continue to rise to the point where the herd mentality begins to believe prices are so high that there is little chance that the house will be more expensive this time next year, and that point the majority will wait and prices will fall.

In a falling market prices will continue to fall to the point when the herd mentality begins to believe there is a little chance that the house will be cheaper this time next year, and that point the majority will start to buy and prices will rise.

This is fairly well accepted market behaviour.

My feeling is that shutting down the economy for 2-3 months and falling rents might later in the year contribute to a sense amongst some buyers that they might be better to wait and see what happens.

It's just a question of whether or not that doubt will develop into the herd mentality. If it does prices will fall.

Markets move in cycles and always have done. The Irish property market is not exempt from this phenomenon.

pearcider

awec wrote: »

People buying their home are not investors. There's a big difference.

If it were as simple as everyone waiting, why didn't everyone just wait in 2018? Or 2017? Or any of the recent years where prices have exploded?

Technically they are.

awec

pearcider wrote: »

Technically they are.

Not really, they have totally different criteria and priorities when going to the market.

awec

schmittel wrote: »

Because the market was going gangbusters in 2017 and 2018. In a rising market people have a fear that the house they want to buy will be more expensive this time next year, so they try and complete a purchase as quickly as possible.

If people think there is a chance the house they want to buy will be cheaper this time next year they will wait.

A rising market will continue to rise to the point where the herd mentality begins to believe prices are so high that there is little chance that the house will be more expensive this time next year, and that point the majority will wait and prices will fall.

In a falling market prices will continue to fall to the point when the herd mentality begins to believe there is a little chance that the house will be cheaper this time next year, and that point the majority will start to buy and prices will rise.

This is fairly well accepted market behaviour.

My feeling is that shutting down the economy for 2-3 months and falling rents might later in the year contribute to a sense amongst some buyers that they might be better to wait and see what happens.

It's just a question of whether or not that doubt will develop into the herd mentality. If it does prices will fall.

Markets move in cycles and always have done. The Irish property market is not exempt from this phenomenon.

Oh I agree. I do think we'll see prices trend downward, I am just not yet convinced it will be massive drops or long-lived.

If it is massive and long lived, it'll be because of mass unemployment, not because a load of people have all collectively decided to wait.

pearcider

awec wrote: »

Not really, they have totally different criteria and priorities when going to the market.

It doesn’t matter they are still deploying capital into purchasing an asset.

hometruths

awec wrote: »

Oh I agree. I do think we'll see prices trend downward, I am just not yet convinced it will be massive drops or long-lived.

If it is massive and long lived, it'll be because of mass unemployment, not because a load of people have all collectively decided to wait.

I think we're in agreement then in as far as I am also not yet convinced that it will be massive or long lived!

Difference being I suspect that unemployment figures could hold up relatively ok but collective waiting could still force prices down further.

Villa05

The_Conductor wrote:

We were very much at an abnormal economic peak- possibly at the start of a decline- before everything went to hell on a broomstick.

Ozark707 wrote:

Pubs etc will take a lot lot longer to open than many other retail units. Though I will be counting down the days till they open as well.

awec wrote:

Many citizens will have lost their jobs, but there'll also be many who are out of work right now who'll be straight back to work. Hairdressers, beauty salons etc will be booked out for weeks. Barbers will be queued out the door.

Has any one considered that the above professions together with childcare will go into the ""blackmarket " as in people will find alternatives and workers will set up "cottage" industries resulting in a lower tax and rates take for the state

awec wrote:

Not really, they have totally different criteria and priorities when going to the market.

I think that after the last crash buyers are fully aware that buying at the wrong time could potentially ruin them and their family so a strong element of investment decision comes into it

awec wrote:

Oh I agree. I do think we'll see prices trend downward, I am just not yet convinced it will be massive drops or long-lived.

Admittidely I was skeptical as well but:

Intial estimates at the cost of this to Ireland is 16 billion. (8 in spending and 8 in lost revenue) That's not too far away from a year's personal tax take. I'm assuming this is if the plan works and there is no 2nd or more waves of infection. Also while China is out the other side of this, there are significant restrictions that will add costs to business

Now let's assume every country has a similar cost, imagine the damage to a small open economy with Brexit in the furnace later in the year. I don't see a v shaped recovery. The best we could hope for is a Nike swoosh one

Thargor

Are all mortgage applications shut down atm or are they still accepting them?

Hubertj

Villa05 wrote: »

Has any one considered that the above professions together with childcare will go into the ""blackmarket " as in people will find alternatives and workers will set up "cottage" industries resulting in a lower tax and rates take for the state




I think that after the last crash buyers are fully aware that buying at the wrong time could potentially ruin them and their family so a strong element of investment decision comes into it



Admittidely I was skeptical as well but:

Intial estimates at the cost of this to Ireland is 16 billion. (8 in spending and 8 in lost revenue) That's not too far away from a year's personal tax take. I'm assuming this is if the plan works and there is no 2nd or more waves of infection. Also while China is out the other side of this, there are significant restrictions that will add costs to business

Now let's assume every country has a similar cost, imagine the damage to a small open economy with Brexit in the furnace later in the year. I don't see a v shaped recovery. The best we could hope for is a Nike swoosh one

I I don’t see a Nike swoosh... I think there will be a ___/ before it’s takes off again but how long is a ___ before the /?

stinger31

awec wrote: »

The pubs, cafes, restaurants etc will definitely get a massive boost as soon as they are allowed to open again, the only question is if it’s a sustained thing or just an initial surge followed by a drop off in custom.

People will have been cooped up in the house for months at that stage, they’ll be counting down the days to get out.

There’ll be good money to be made if you’re a babysitter too I reckon!

Do you fancy spending a few hours in a packed boozer,Cafe or restaurant ? I certainly don't. Unfortunately i can see a lot of hardship for this type of industry. numbers will be way down.

The knock on affect of this will take years to go away.

ebayissues

With cov19, one thing this shown is that with an internet and Pc, you can work anywhere.

Government and employers really need to push wfh.

If I can do my job successfully in a rented apartment in Dublin why can't I do it in cork or galway or in Madrid?

If a WFH mentality is adopted this can affect housing market aswell. I certainly would consider options of moving to the country or somewhere else.

However this can affect wages. Temporarily if this happens there will be wage arbitrage, someone living in limerick but getting paid Dublin wages. However as remote working becomes the norm, which I'm hoping for, wages will be on a level ground.

One thing though is, not all would like to WFH 5 days in a role, especially parents with toddlers.

Just my thoughts..

stinger31

awec wrote: »

Yea they’ll be waiting a while and there’ll be restrictions.

But as soon as those places open there’ll be no shortage of custom. Even if people are tight with money we’ve never experienced a time when we’ve literally been confined to our homes with zero social interaction like we are now. People will be desperate to get out.

I do think the majority who lost their job in the hospitality sector will be getting it back relatively quickly once restrictions are eased.

Retail workers maybe not so much.

nonsense, what jobs will they go back to? there won't be a fraction of the numbers of tourists here for a long time

handlemaster

FF /FG said they want to interfere again with the housing market. This time wait for it.. more rights for tenants. . What could possibly go wrong here. The rush of landlords to get out is already underway.

Hubertj

handlemaster wrote: »

FF /FG said they want to interfere again with the housing market. This time wait for it.. more rights for tenants. . What could possibly go wrong here. The rush of landlords to get out is already underway.

Glad I’m not a landlord. Sounds like more left wing bolloxology to attract smaller parties for the coalition.

awec

stinger31 wrote: »

nonsense, what jobs will they go back to? there won't be a fraction of the numbers of tourists here for a long time

You think the pubs, clubs, cafes and restaurants of Ireland are permanently closed yea?

The same pubs, clubs, cafes and restaurants that the government had to forcibly close to stop people going to them in the middle of a pandemic?

stinger31

awec wrote: »

You think the pubs, clubs, cafes and restaurants of Ireland are permanently closed yea?

The same pubs, clubs, cafes and restaurants that the government had to forcibly close to stop people going to them in the middle of a pandemic?

Didn't say permanently did i? and when the gov stepped it it wasn't in the middle of the Pandemic, it was the start of it here. People weren't taking it serious at the start but i'm amazed at how well people are behaving now. People realise now how serious this all is.

Won't be confidence in that sector in a long time.

Maitguel

handlemaster wrote: »

FF /FG said they want to interfere again with the housing market. This time wait for it.. more rights for tenants. . What could possibly go wrong here. The rush of landlords to get out is already underway.

More rights??? Such as the tenant shall have the option to register themselves as the owner after 6 months?!?

What I would like to see is a rent to buy scheme coming back, not sure why this was stopped but seems like a very practical solution to help people toward home ownership.

awec

awec wrote: »

You think the pubs, clubs, cafes and restaurants of Ireland are permanently closed yea?

The same pubs, clubs, cafes and restaurants that the government had to forcibly close to stop people going to them in the middle of a pandemic?

Patricks Day, restaurants open...... Most deserted.

Deco99

So if WFH will become more popular after this does this mean house prices outside the main urban centres is alot less likely to drop the much touted on here 30% considering they wouldn't have been the high prices to begin with.

BillyBiggs

awec wrote: »

You think the pubs, clubs, cafes and restaurants of Ireland are permanently closed yea?

The same pubs, clubs, cafes and restaurants that the government had to forcibly close to stop people going to them in the middle of a pandemic?

As commentators have said on the news, once restaurants and cafes open, it’s not like they will be full on the first day back. It will take time for people to trust that the virus is truly under control. People won’t want to sit inches from strangers in such outlets, they will probably still want to be two feet from others. Admittedly the government will have to restrict numbers going into bars, because you will get clowns flowing in the doors of bars, throwing caution to the wind.

ittakestwo

handlemaster wrote: »

FF /FG said they want to interfere again with the housing market. This time wait for it.. more rights for tenants. . What could possibly go wrong here. The rush of landlords to get out is already underway.

What party has "less rights for tenants" as their manifesto?

IndieRoar111

awec wrote: »

This is not how it works in the real world.

Prices will be driven down because people cannot buy any more, not that they have chosen not to or just all decided to wait.

If it was a case of everyone waiting and then everyone buying then prices would just instantly skyrocket again as demand surges. If you want your bargains then you need a huge number of potential buyers removed from the market for the foreseeable future.

In the real world when people are in a position to buy they will buy. There’s no collective “let’s all just wait.”

Where did i mention that would be the sole reason for a drop? It is not the main reason but it certainly can be influential.

IndieRoar111

schmittel wrote: »

There is certainly anecdotal evidence on these boards that people who were sale agreed 6 weeks ago are wondering whether or not to proceed. Some have mentioned job security, others have mentioned fear of negative equity etc.

Not quite a collective lets all just wait but it won't take much to tip it into that.

Ditto.

Anecdotal evidence will transcend into data soon enough and then the property crash deniers will see for themselves.

hometruths

ittakestwo wrote: »

What party has "less rights for tenants" as their manifesto?

None, I checked before casting my vote, as I would have voted for the party brave enough to put that in their manifesto!

IndieRoar111

Thargor wrote: »

Are all mortgage applications shut down atm or are they still accepting them?

There's been talk of Ulster bank and TSB curtailing some existing AIP and downright rejecting new applicants, i assume most of these were not considered strong applicants. I can't say for sure though as i'm not currently in the process.

With exemptions scrapped and banks more picky expect to see less buyers within a couple of months.

IndieRoar111

ebayissues wrote: »

With cov19, one thing this shown is that with an internet and Pc, you can work anywhere.

Government and employers really need to push wfh.

If I can do my job successfully in a rented apartment in Dublin why can't I do it in cork or galway or in Madrid?

If a WFH mentality is adopted this can affect housing market aswell. I certainly would consider options of moving to the country or somewhere else.

However this can affect wages. Temporarily if this happens there will be wage arbitrage, someone living in limerick but getting paid Dublin wages. However as remote working becomes the norm, which I'm hoping for, wages will be on a level ground.

One thing though is, not all would like to WFH 5 days in a role, especially parents with toddlers.

Just my thoughts..

This will be a game changer.

Many prospective buyers will see most of Dublin for the rip-off kip that it is and buy somewhere nice down the country. Foreign nationals will be the majority in this.

Villa05

Maitguel wrote:

More rights??? Such as the tenant shall have the option to register themselves as the owner after 6 months?!?

That seems to be reserved for "buyers" with 30,000 mortgages more than 5 years behind on their mortgage.

I'd say long term leases an a move towards a European model is more likely

Deco99 wrote:

So if WFH will become more popular after this does this mean house prices outside the main urban centres is alot less likely to drop the much touted on here 30% considering they wouldn't have been the high prices to begin with.

Areas like Kilkenny, Waterford Wexford large town and cities will become more popular. Lots to offer with decent access to Dublin

Tourist spots with good access to job centres, West Cork, Cork, Clare Kerry Galway