Property Market 2020

Villa05

Cyrus wrote:

assuming their earnings dont grow at all of course, which is not the assumption of someone buying into a stock trading at a high multiple.

I think you missed the point, Netflix is available in 190 countries, many are in lock down, this would infer that Netflix is at or close to peak subscription level. I'm sure Netflix will find other revenue sources but for their core business they have reached peak

In there most recent report to the market they hinted that their current subscription level is unsustainable in the medium to long term

A valuation at 80 times earnings is significant bubble territory,
Similar concerns have been raised about the valuations of "FAANGS" stocks, commercial property,

fliball123

tastyt wrote: »

So there seems to be a general consensus that property prices will drop, anywhere between 10 - 30 percent depending on how severe you think it will be.

My question is, why isn’t is happening already when we are in the worst of the crisis and probably the highest number of people unemployed?

When do people expect these price drops to actually happen and what will be the catalyst? I’m just trying to understand why prices would drop more after the lockdown and crisis is over, and people are back to work more than they have dropped during the crisis ?

Well a few reasons the market is in a state of stalemate people are finding hard to buy and sell at the moment and property always takes time to be impacted as at a push it takes at least 3 months to buy/sell a property and a lot can happen in 3 months.

combat14

https://goss.ie/showbiz/maia-dunphy-hits-out-at-dublin-developer-johnny-ronan-after-bewleys-closure-f-you-207921

1.5 million in rent (doubled from 750,000 in 2007 at height of boom) - something has to give in this country- commercial and residential rents and yes property prices way too high !!!

JimmyVik

fliball123 wrote: »

Thats not correct there were increments still being paid even during the last recession and some of the pay cuts were restored what should happen is PS should be told to fund their pensions themselves and not have the tax payer do it, I think it is very unfair to ask one subset of workers (private sector and self employed) to contribute to another subset of workers (the public sector) pensions when the vast majority of the first sector cannot afford their own and even with the pension levy it comes no where near enough to cover the costs

I dont think increments amounted to much for them at all.
I know if I worked for a company for 20 years or more and they suddenly decided that they were not going to stick to the terms we had for the last 20 or more years since I started, like the pension the PS get, I would feel very hard done by. Wouldnt you?


Do you think that the public sector paid more or less than the private sector for the last recession. Im private sector and I think the public sector were shafted to high heaven. I think they are still being shafted today.

Hubertj

Villa05 wrote: »

Not to every backwater in the country, bring it as far as town Village centres. Subsidise 50/50 cost share to anywhere else, this will drastically reduce cost



Disagree, these countries always looking for workers in specific sectors and will absorb the cream of the crop from poorly run countries




Banks will have to make higher provision for bad loans > less to loan out > higher proportion of bad loans to profitable loans > higher % rates to compensate for bad loans > further bad loans due to higher % rates > collapse of mortgage market > collapse in house prices

i agree with you on the Broadband Plan.

Disagree with you on emigration. some will be able to but nowhere near the numbers like last time.

I think you are overusing the word collapse..... are you assuming no stimulus into economy from government + EU?

hometruths

tastyt wrote: »

So there seems to be a general consensus that property prices will drop, anywhere between 10 - 30 percent depending on how severe you think it will be.

My question is, why isn’t is happening already when we are in the worst of the crisis and probably the highest number of people unemployed?

When do people expect these price drops to actually happen and what will be the catalyst? I’m just trying to understand why prices would drop more after the lockdown and crisis is over, and people are back to work more than they have dropped during the crisis ?

Market is frozen at the minute so prices don't really have an opportunity to go up or down!

Beyond that any opinion is little more than a guess, but sure what's the harm in that?!

I'd say that when it opens back up again - August I think? - there will be a period where the existing sale agreeds and approved mortgages wash through the system; i.e buyers and sellers agree to proceed or not and those who retained mortgage approval decide whether to buy or not.

It will take until end of year until we can see data on these prices

This I think will look like the soft landing - a drop of around 5%.

I think the drop from 5% - 20% will be occur over the following 12 months - first half of next year 10% then in second half 20%.

I think the drops will then slowly grind towards 30%.

How long that take and whether it not they reach 30% in my opinion depends entirely on the global availability of a vaccine.

i.e I think they'll bottom at 30% and will not rebound until we get vaccine, or bottom between 20-30% if we get a vaccine sooner.

There is a lot of talk of how this time it is different which is very true.

But all the focus on the banks in better health, no oversupply etc etc ignores the fact that we are not going back to where we were 6 months ago without a vaccine.

No amount of robust bank balance sheets or QE or borrowing billions for economic stimulus can change that fact.

When I am talking about drop of X% I mean in the average national property value. I get that a ruin in arsehole of Leitrim will drop differently to the penthouse in Ballsbridge!

Cuddlesworth

JimmyVik wrote: »

I dont think increments amounted to much for them at all.
I know if I worked for a company for 20 years or more and they suddenly decided that they were not going to stick to the terms we had for the last 20 or more years since I started, like the pension the PS get, I would feel very hard done by. Wouldnt you?


Do you think that the public sector paid more or less than the private sector for the last recession. Im private sector and I think the public sector were shafted to high heaven. I think they are still being shafted today.

There are pros and cons with being publically employed.

One of the major perks is regardless of the situation, the job is secure. That means Global Recession, pandemic whatever, their jobs are there. Have you heard of many public service workers furloughed or added to the live register recently? This has a knock on effect, in things like Mortgages where their employment is viewed as the least risky around. You won't see many Civil servant couples AIP being pulled in the next few months.

The main downside is usually lower pay for the same roles. In some cases the amounts can be laughable, so they usually end up as contractor roles instead just to fill them and avoid the PS pay structure.

cnocbui

JimmyVik wrote: »

I dont think increments amounted to much for them at all.
I know if I worked for a company for 20 years or more and they suddenly decided that they were not going to stick to the terms we had for the last 20 or more years since I started, like the pension the PS get, I would feel very hard done by. Wouldnt you?


Do you think that the public sector paid more or less than the private sector for the last recession. Im private sector and I think the public sector were shafted to high heaven. I think they are still being shafted today.

The public sector are the most coddled and privelidged of all workers in this country. They are overpaid by 35%, in comparrison with the private sector. I am not even going to attempt to factor in the degree of further featherbedding they get due to the incredibly generous pension arrangements.

Private sector workers' pay is rising faster than public servants' - but State workers still earn 35pc more.

New official figures reveal that private sector workers' earnings rose by 4.2pc in the 12 months to March of this year.

This outpaced 1.2pc growth in public sector pay in the same timeframe.

A private sector worker's average pay rose from €685 a week, or from €35,794 a year to €37,291.

In contrast, public sector workers' wages increased from €952 a week, or €49,721 a year to €50,320 a year - 35pc more.

https://www.independent.ie/irish-news/private-sector-pay-rising-faster-than-public-sector-but-wages-are-still-lower-38155326.html

Irish Public sector workers have the highest average salaries of all such workers in the EU, excepting those in Luxembourg:

Zenify

JimmyVik wrote: »

Thats less than 50 feet from the M50 Not surprised.
When you stand in that garden you wouldnt be able to hear what the EA is saying to you.

That's the reason we didnt Bid on it. I've been there and yes you can hear it. I have the planning permission plans and I think from memory it includes a retaining wall at the back hill. I assume this is a condition of the planning, due to land slides. Also probably why people arnt interested because of the cost of that.

tastyt

The fact is public sector workers employer is the state, when the country ( your boss ) is broke you can’t be expecting increments, I don’t understand how people don’t get this .

Thousands of people in the private sector will have no jobs or big wage cuts after this because their employers are broke.

The public sector in this country and their unions need to be brought into the real world.

It’s a subject for a different thread anyway

wassie

JimmyVik wrote: »

So where are you going to get the money to do that?

Simples - ECB.

Just in the last couple of days they stated they will release upwards of €20bn for Irish banks to lend out in non-mortgage lending. And theres more where that came from.

JimmyVik

Cuddlesworth wrote: »

There are pros and cons with being publically employed.

One of the major perks is regardless of the situation, the job is secure. That means Global Recession, pandemic whatever, their jobs are there. Have you heard of many public service workers furloughed or added to the live register recently? This has a knock on effect, in things like Mortgages where their employment is viewed as the least risky around. You won't see many Civil servant couples AIP being pulled in the next few months.

The main downside is usually lower pay for the same roles. In some cases the amounts can be laughable, so they usually end up as contractor roles instead just to fill them and avoid the PS pay structure.

Agreed.

Slow and steady in the public sector or fast and risky in the private sector.
We could all choose whichever we wanted. No point crying because person a has a secure job when you went for the rewards of the risky one.



For instance I had a 10% pay cut overnight. Then a few years later it wouldnt be unusual every year to have a 10% rise overnight and a 10% bonus on top. One year i got a 20% rise and a bonus.


Now im happy to take the risk and the reward. Others might be happy to go the slow and steady route. You makes your choice and you live with it.



I fully respect people who went the public sector route. They didnt get the huge highs that I did, but they went for stability and they should get be allowed to get that. Just because I might take a 10% drop this year doesnt mean everyone should. They all didnt get that 10% in the last year like I did. Why should they lose 10% like me?

Hubertj

schmittel wrote: »

Market is frozen at the minute so prices don't really have an opportunity to go up or down!

Beyond that any opinion is little more than a guess, but sure what's the harm in that?!

I'd say that when it opens back up again - August I think? - there will be a period where the existing sale agreeds and approved mortgages wash through the system; i.e buyers and sellers agree to proceed or not and those who retained mortgage approval decide whether to buy or not.

It will take until end of year until we can see data on these prices

This I think will look like the soft landing - a drop of around 5%.

I think the drop from 5% - 20% will be occur over the following 12 months - first half of next year 10% then in second half 20%.

I think the drops will then slowly grind towards 30%.

How long that take and whether it not they reach 30% in my opinion depends entirely on the global availability of a vaccine.

i.e I think they'll bottom at 30% and will not rebound until we get vaccine, or bottom between 20-30% if we get a vaccine sooner.

There is a lot of talk of how this time it is different which is very true.

But all the focus on the banks in better health, no oversupply etc etc ignores the fact that we are not going back to where we were 6 months ago without a vaccine.

No amount of robust bank balance sheets or QE or borrowing billions for economic stimulus can change that fact.

When I am talking about drop of X% I mean in the average national property value. I get that a ruin in arsehole of Leitrim will drop differently to the penthouse in Ballsbridge!

it will be more about effective treatments than vaccine short term. There should be further developments on this over the coming months. IF existing drugs can be re-purposed for Covid treatment this will make a big difference.

fliball123

JimmyVik wrote: »

I dont think increments amounted to much for them at all.
I know if I worked for a company for 20 years or more and they suddenly decided that they were not going to stick to the terms we had for the last 20 or more years since I started, like the pension the PS get, I would feel very hard done by. Wouldnt you?


Do you think that the public sector paid more or less than the private sector for the last recession. Im private sector and I think the public sector were shafted to high heaven. I think they are still being shafted today.

What are you on about they got paid increments right through 2008 to today. back in 2010 over 400000 lost their jobs with in the private sector anyone who lost a job in the public sector got golden parachute payments and a generous pension.

Being honest if the company you worked for didnt ask the tax payer to cover your pensuion I dont mind what you do or how you feel but that's the difference the public sector are expecting people to pay for their pension when they cant afford their own so tough sh1t pay your own way thanks

GreeBo

Graham wrote: »

I'd argue the exact opposite.

We're not going to kickstart the economy with austerity.

I think its somewhere in the middle.
We need to cut out all spending that doesnt create employment or move the economy.
Giving every household a €10 a week wont do squat, but embarking on some large infrastructure projects (which should be pretty cheap these days) would give people jobs which in turn will help the economy.

Donald Trump

Graham wrote: »

It's also easy to forget that at the start of the GFC the impact on property prices was massively amplified by the shear volume of unsold new builds.

Estimates vary between 35,000 and 100,000 new build houses in 2009. There's nothing like that number today.

"unsold" would need to be divided up into

1) Finished and ready for sale. Perhaps in an estate with already occupied houses
2) Structurally complete, and maybe in an estate with not many sales, but with roadways and driveways in place
3) Sites with poured foundations, maybe partially erected walls and the odd one with a roof on it.


There were "houses" in "ghost estates" knocked down the last time around. I know someone personally who bought a house 6-8 years later after an unfinished estate was eventually out and finished. When the bust came, the houses were closed in, i.e. outer walls and roof built with outer doors and windows but they sat there for years when the original builder went bust. The fella who bought them later on still had to do a fair bit to them to bring them up to saleable condition. They were in a decent location but were not going to be sold the way they were. I don't think you could really include them in "housing stock" over that period they were sitting there idle.

Graham

Even taking the pessimistic view that half were unfinished, that's still a couple of years peak-demand hitting a distressed market simultaneously.

That's not going to happen now.

Padre_Pio

Graham wrote: »

Even taking the pessimistic view that half were unfinished, that's still a couple of years peak-demand hitting a distressed market simultaneously.

That's not going to happen now.

While these are still needed, there's a lot on the way.
Bord Pleanala are still approving projects, 240 houses in Cobh got PP last month.

IT estimates 60,000 homes under construction right now, of which 22,000 are due to finish this year.

https://www.irishtimes.com/business/construction/coronavirus-halts-building-of-60-000-homes-in-ireland-1.4230460

Graham

22,000 would be less than a years demand. I would hazard a guess, the majority of the 22,000 have already been sold.

There's a lot less speculative building going on these days. Most large scale developments are pre-sold off plan.

Eric Cartman

Cluid and the councils will get the chequebook out when prices drop off and buy the second fix / finished houses for social housing. The general public won't get a look in on new build discounts but a lot of people who paid up to half a million quid for a house are about to be living with much lower income neighbours than themselves.

it will however mean the builders don't go to the wall and subbies will be paid so shouldn't cause the same issues as the last time.

fliball123

Padre_Pio wrote: »

While these are still needed, there's a lot on the way.
Bord Pleanala are still approving projects, 240 houses in Cobh got PP last month.

IT estimates 60,000 homes under construction right now, of which 22,000 are due to finish this year.

https://www.irishtimes.com/business/construction/coronavirus-halts-building-of-60-000-homes-in-ireland-1.4230460

By the time they are built there will be extra people and therefore extra houses needed on top, I cannot see 60k new houses being built in the next 12 months at a stretch and if the gov prioritise maybe 24 months but surely the money will be needed else where

The Belly

Eric Cartman wrote: »

Cluid and the councils will get the chequebook out when prices drop off and buy the second fix / finished houses for social housing. The general public won't get a look in on new build discounts but a lot of people who paid up to half a million quid for a house are about to be living with much lower income neighbours than themselves.

it will however mean the builders don't go to the wall and subbies will be paid so shouldn't cause the same issues as the last time.

It will when the finance drys up building will stop.

The_Conductor

Eric Cartman wrote: »

Cluid and the councils will get the chequebook out when prices drop off and buy the second fix / finished houses for social housing. The general public won't get a look in on new build discounts but a lot of people who paid up to half a million quid for a house are about to be living with much lower income neighbours than themselves.

it will however mean the builders don't go to the wall and subbies will be paid so shouldn't cause the same issues as the last time.

Why do you imagine that Clúid and the Local Authorities are going to be sanctioned by the Department to go on house buying sprees? We've had a few housing associations and charities go bankrupt already (after over-extending themselves in the expectation that they would be bailed out by central government) and Local Authorities have been knee-capped by the manner in which local property tax is administered.

If you think Clúid and others are going on a house buying spree- I think you're going to be sadly disappointed.

The Belly

Cluid and the rest of the housing agencies are band aid made to look like things are being done. They werent the solution before and wont be now.

The_Conductor

Graham wrote: »

22,000 would be less than a years demand. I would hazard a guess, the majority of the 22,000 have already been sold.

There's a lot less speculative building going on these days. Most large scale developments are pre-sold off plan.

Yup- I'd say the lion's share of them have been sold before a sod was ever turned- and a not insignificant number of the other units probably are too.

LAs, HAs and HCs have the go-ahead to go back to work (from the 18th)- with other construction workers due to return later. Yes- the social housing sector will get a fillip over the rest of the sector, for now, however, its a short term injection- which is expedient for political reasons. And yes- if I sound cynical, I am damn cynical.

Lenders have been spared this time round (predominantly because of prudent central bank lending rules)- but even our mortgage lenders are caught between a rock and a hard place. They have already stated that the second 3 month moratorium for mortgages is the end- after this- its formal restructurings for borrowers, whether they like it or not, no more 'holidays'.

We have booted some of the economic and financial costs associated with Covid down the road- but unfortunately, those bills will eventually come due- and that due date for a lot of people, seems like it is going to be 1st of September 2020..........

The_Conductor

The Belly wrote: »

Cluid and the rest of the housing agencies are band aid made to look like things are being done. They werent the solution before and wont be now.

A massive bandaid- originally formed as a manner of getting the cost of providing social housing off the state's books. Unfortunately the wheels came off that cart when Eurostat refused to enumerate Clúid's (and other's) finances as 'off-book' from state funding- so their raison d'etre is no more.

By rights all the housing associations should be folded into local authorities- and administered fully by local authorities- the whole notion of having a plethora of them out there fighting for funding and other scarce resources (including but not limited to knowledgeable manpower)- is just nuts.

Disband them- do a spring clean, they were allowed form for political reasons, they certainly can be liquidated for political reasons.

The Belly

The_Conductor wrote: »

A massive bandaid- originally formed as a manner of getting the cost of providing social housing off the state's books. Unfortunately the wheels came off that cart when Eurostat refused to enumerate Clúid's (and other's) finances as 'off-book' from state funding- so their raison d'etre is no more.

By rights all the housing associations should be folded into local authorities- and administered fully by local authorities- the whole notion of having a plethora of them out there fighting for funding and other scarce resources (including but not limited to knowledgeable manpower)- is just nuts.

Disband them- do a spring clean, they were allowed form for political reasons, they certainly can be liquidated for political reasons.

Youve summed it up. Housing should be a LA function and it will be again once all the dust settles. It wont be by choice but by necessity.

ittakestwo

fliball123 wrote: »

By the time they are built there will be extra people and therefore extra houses needed on top, I cannot see 60k new houses being built in the next 12 months at a stretch and if the gov prioritise maybe 24 months but surely the money will be needed else where

Extra population will only create demand if the people have jobs. There will be less people working in 2021 than there was in 2019. So demand from people with no jobs does stop property prices from falling.

A lot of property maybe be sold off plans, but if it comes to the time to draw down the mortgage and the buyer has lost their job they cant go ahead with the purchase.

fliball123

ittakestwo wrote: »

Extra population will only create demand if the people have jobs. There will be less people working in 2021 than there was in 2019. So demand from people with no jobs does stop property prices from falling.

A lot of property maybe be sold off plans, but if it comes to the time to draw down the mortgage and the buyer has lost their job they cant go ahead with the purchase.

a lot of the people losing their job would not of been in a position to buy ie hospitality and retail are hardly high paid

The Belly

ittakestwo wrote: »

Extra population will only create demand if the people have jobs. There will be less people working in 2021 than there was in 2019. So demand from people with no jobs does stop property prices from falling.

A lot of property maybe be sold off plans, but if it comes to the time to draw down the mortgage and the buyer has lost their job they cant go ahead with the purchase.

If we dont see a v curve recovery which we wont, Your going to see private construction stop. A massive increase on an already massive waiting list for social housing and who every is in government is going to be faced with this issue which will be bigger then the health crisis. As much as they dont want to social house building will start.

It may take time but that is coming down the road. The effect on house prices will be up and down in the near future until all this pans out and the true figures come to light. When it does expect a big fall.