Property Market 2020

Marius34

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

"Estimates of the number that would have been built in 2020 before the pandemic struck were about 22,000."

Due to lockdown, there is no way of completion over 20K for this year.
60,000 homes are obviously just on the papers. I'll guess probably for half of them we would currently find just empty fields.

Round Cable

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 ?

That's the thing, the Irish property market is not like the stock market, where a company's value can fall 50% in a day if they reported unexpected bad results.

With property, the prices keep rising until they hit a peak, and then keep falling until they hit a trough, and they can stagnate around the peak and trough for significant periods.

During the great recession, beginning in 2007, it took 4-5 years for the Irish property market to bottom out.

The Belly

Round Cable wrote: »

That's the thing, the Irish property market is not like the stock market, where a company's value can fall 50% in a day if they reported unexpected bad results.

With property, the prices keep rising until they hit a peak, and then keep falling until they hit a trough, and they can stagnate around the peak and trough for significant periods.

During the great recession, beginning in 2007, it took 4-5 years for the Irish property market to bottom out.

cant compare then to now.

Round Cable

The Belly wrote: »

cant compare then to now.

I never said that you should. The point is that when the property market swings towards a fall, it will not bottom out overnight.

Donald Trump

Central Bank boss defends banks withdrawing mortgage offers

https://www.independent.ie/business/personal-finance/central-bank-boss-defends-banks-withdrawing-mortgage-offers-39187904.html

The Belly

Round Cable wrote: »

I never said that you could. The point is that when the property market swings towards a fall, it will not bottom out overnight.

yes it wont it will take time i suppose the drivers are different this time.

JimmyVik

fliball123 wrote: »

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

Anyone who was in a position to buy but has lost their job will not get a mortgage.

Villa05

smndly wrote:

If GDP is significantly higher than servicing the debt after the recovery it will essentially result in the slow erosion of the debt as the economy grows - provided we don't take on loads more debt...

A big part of our gdp figures is aircraft leasing and other transactions. This is gone for some time

SozBbz wrote:

1. Ireland was one of the most effected countries in the world, so it was particularly severe for us. 2. We had a perfect storm in terms of our housing bubble being right at the top at the same time that world markets collapsed. 3. There was a moral hazard argument against anything but austerity. The system was built on sand and propping it up with all the underlying issues would never have rooted out all the bad apples (soz for the mixed metaphors).

Dublin certainly looks like it was at the top of a price cycle with prices plateauing from Oct 2018

Graham wrote:

While NAMA definitely softened the blow by soaking up some of the excess that didn't happen immediately. There was a significant period where developers were trying to offload new builds at anything upto 50% discounts to the original asking prices.

The collapse didn't happen immediately it took 4 years to find the bottom well after Nama had hoovered up the excess

Hubertj wrote:

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

You'd be surprised we'll run countries will be running stimulus programs to kick start economies

Hubertj wrote:

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

Collapse was in response to a poster believing people strategically defaulting on mortgages was a positive for house prices.

fliball123

JimmyVik wrote: »

Anyone who was in a position to buy but has lost their job will not get a mortgage.

Not all but I think anyone in a position to get a mortgage will be holding off as they would be mad to go ahead with the uncertainty.

fliball123

Villa05 wrote: »

A big part of our gdp figures is aircraft leasing and other transactions. This is gone for some time




Dublin certainly looks like it was at the top of a price cycle with prices plateauing from Oct 2018



The collapse didn't happen immediately it took 4 years to find the bottom well after Nama had hoovered up the excess


You'd be surprised we'll run countries will be running stimulus programs to kick start economies



Collapse was in response to a poster believing people strategically defaulting on mortgages was a positive for house prices.

I don't think a lot of people will emigrate Ireland will have its own stimulus package on top of possible one of the most generous social welfare systems in the world, cant see many leaving the tax payer teeth

combat14

interesting to see what happens commercial rents and ultimately property prices. Will landlords reduce rents, give rent holidays or be happy to accept empty premises with no rent for an extended period of time .......

I'm sure similar issue for residential market once covid payments are cut and businesses/workers struggle to go back to work... this will all have a downward affect on rents/ property values..

"Landlords need to take some pain' - Reaction as dispute unfolds between Bewley's and Ronan Group"

https://m.independent.ie/breaking-news/irish-news/landlords-need-to-take-some-pain-reaction-as-dispute-unfolds-between-bewleys-and-ronan-group-39188593.html

Blueshoe

I'm a waiting 90% cash buyer for a small apartment in the Midlands. I can tell you that the available stock and suitable choices are few and far between.
There is very little on the market

Poor availability and over priced properties.

q85dw7osi4lebg

Few friends of mine who are mortgage approved and still have their jobs are now very keen to get into the market before they lose their jobs etc. Wonder if there is many in this boat, could lead to one final market pump in the short term?

landofthetree

Blueshoe wrote: »

I'm a waiting 90% cash buyer for a small apartment in the Midlands. I can tell you that the available stock and suitable choices are few and far between.
There is very little on the market

Poor availability and over priced properties.

Apart from Social developments I cant remember the last new build apartments Ive seen in the midlands.

combat14

Julissa Bitter Jeep wrote: »

Few friends of mine who are mortgage approved and still have their jobs are now very keen to get into the market before they lose their jobs etc. Wonder if there is many in this boat, could lead to one final market pump in the short term?

if they are that worried about losing their jobs.... why would they go take on the additional debt/responsibility of a mortgage with that degree uncertainty hanging over them?

guess banks are thinking the same... hence the increasing restrictions on who they are lending to .. ultimately any cut back or restriction in lending will dampen prices ...

Blueshoe

landofthetree wrote: »

Apart from Social developments I cant remember the last new build apartments Ive seen in the midlands.

Exactly. There is very little that is suitable for me for sale.
No shortage of BerF 50 year old houses though.
Any apartments that are for sale are overpriced at the minute in comparison to other parts of the country in my opinion.
But people need places to live and with a small stock people will pay more than the next guy.
Nothing will change in this situation

combat14

Blueshoe wrote: »

Exactly. There is very little that is suitable for me for sale.
No shortage of BerF 50 year old houses though.
Any apartments that are for sale are overpriced at the minute in comparison to other parts of the country in my opinion.
But people need places to live and with a small stock people will pay more than the next guy.
Nothing will change in this situation

but also Midlands more suspectible to recession as no proper industry there .. highly reliant on service industry (shut down for moment) to supply jobs...

prices in my estate (Midlands) are about 20%+ over valued .. e.g. looking for 190,000 for houses that havent sold at 150,000 for most of the last 12 years ..

GreeBo

The real question isnt will prices fall or even how far will they fall, its how long to recover.

All things considered, ignoring obvious outliers, house prices will always rise over time due to demand outstripping supply.
If you are going to buy you need to decide for yourself how much it will cost to keep renting, the value you put on owning a home rather than renting and the opportunity you are faced with (assuming you have a property in mind)
If you are selling its similar enough, if you are in no rush to sell then arguably do nothing. If you are in a rush then ask yourself how long do you think it will be before prices are back where they are/were. what will it cost you to wait that long. What are the prices of your next property going to do and whats the net gain/loss in the difference.

Unless you are buying a gasworks apartment for 2M or a 1 bed apartment in Ticknock for 800K then chances are in a couple of years prices will be right back where they were when you bought. Arguably you shouldnt be buying any property that you think will not rise in value. If you are going to buy it anyway and dont care about an increase in value, then you should just uy it anyway and not worry about prices going up or down.

TL;DR
Buy now, the ladder only goes one way long term.

combat14

GreeBo wrote: »

The real question isnt will prices fall or even how far will they fall, its how long to recover.

All things considered, ignoring obvious outliers, house prices will always rise over time due to demand outstripping supply.
If you are going to buy you need to decide for yourself how much it will cost to keep renting, the value you put on owning a home rather than renting and the opportunity you are faced with (assuming you have a property in mind)
If you are selling its similar enough, if you are in no rush to sell then arguably do nothing. If you are in a rush then ask yourself how long do you think it will be before prices are back where they are/were. what will it cost you to wait that long. What are the prices of your next property going to do and whats the net gain/loss in the difference.

Unless you are buying a gasworks apartment for 2M or a 1 bed apartment in Ticknock for 800K then chances are in a couple of years prices will be right back where they were when you bought. Arguably you shouldnt be buying any property that you think will not rise in value. If you are going to buy it anyway and dont care about an increase in value, then you should just uy it anyway and not worry about prices going up or down.

TL;DR
Buy now, the ladder only goes one way long term.

Buy now, unless you are on the cusp of losing your job, and that is hard to say at the minute for a lot of workers out there...

GreeBo

combat14 wrote: »

Buy now, unless you are on the cusp of losing your job, and that is hard to say at the minute for a lot of workers out there...

buy now if you can buy now, obviously.

The Belly

GreeBo wrote: »

buy now if you can buy now, obviously.

Or wait.

q85dw7osi4lebg

combat14 wrote: »

if they are that worried about losing their jobs.... why would they go take on the additional debt/responsibility of a mortgage with that degree uncertainty hanging over them?

guess banks are thinking the same... hence the increasing restrictions on who they are lending to .. ultimately any cut back or restriction in lending will dampen prices ...

They live in an area where job seekers allowance per couple is more than enough to cover the mortgage, not everyone lives in Dublin.

I think it's a great idea really, they'll be living in these homes for a very long time by choice. It's that or rent for the next few years, whether they lose their job or not.

hometruths

GreeBo wrote: »

Unless you are buying a gasworks apartment for 2M or a 1 bed apartment in Ticknock for 800K then chances are in a couple of years prices will be right back where they were when you bought.

TL;DR
Buy now, the ladder only goes one way long term.

tell that to people who bought in 2007!

The Belly

schmittel wrote: »

tell that to people who bought in 2007!

took a hell of a long time and prices still never fully recovered

combat14

We mourn the loss of once-great Bewley's cafe but it failed because it simply wasn't good enough

https://m.independent.ie/opinion/we-mourn-the-loss-of-once-great-bewleys-cafe-but-it-failed-because-it-simply-wasnt-good-enough-39189080.html


Was Bewleys not good enough...?

Or simply was the 1,500,000 euro rent too damn high?!

McDonalds on the same street thought so .. In 2014 they got their 1.15m rent on the same street reduced to
a more reasonable €600,000 per year...

is it time that property landlords share some of the pain during the covid crisis before there is a reduction of shops for workers to return to.....?!

Hubertj

combat14 wrote: »

We mourn the loss of once-great Bewley's cafe but it failed because it simply wasn't good enough

https://m.independent.ie/opinion/we-mourn-the-loss-of-once-great-bewleys-cafe-but-it-failed-because-it-simply-wasnt-good-enough-39189080.html


Was Bewleys not good enough...?

Or simply was the 1,500,000 euro rent too damn high?!

McDonalds on the same street thought so .. In 2014 they got their 1.15m rent on the same street reduced to
a more reasonable €600,000 per year...

is it time that property landlords share some of the pain during the covid crisis before there is a reduction of shops for workers to return to.....?!

€1.5m rent for a cafe? Did they sign up to that or was it as part of rent reviewed (however they work). Sounds insane.

Also while Ronan is landlord I presume he has obligations to lenders? Maybe he can’t get a break from them? Or he’s just a pr*ck?

Assetbacked

Ronan is the playboy Paddy who dances a jig and reel for his US PE paymasters, he isn't the landlord himself I don't think.

combat14

rent was about 750000 and got upped to about 1.3 million -1.5 million in 2007 at the height of the boom... they made a loss of 1.5 million last years as it happens and have been trying for years to get the rent reduced to no avail

cafe looking for a six month rent holiday In march during height of covid crisis

ronan says the cafe shareholders have tons of money and can sustain such rents and losses themselves.. he is not going to take the hit for them ... for now.......
.

addaword

combat14 wrote: »

McDonalds on the same street thought so .. In 2014 they got their 1.15m rent on the same street reduced to
a more reasonable €600,000 per year...

They would want to sell a lot of euros saver burgers @ €1 to pay that rent.

ittakestwo

GreeBo wrote: »

The real question isnt will prices fall or even how far will they fall, its how long to recover.

All things considered, ignoring obvious outliers, house prices will always rise over time due to demand outstripping supply.
If you are going to buy you need to decide for yourself how much it will cost to keep renting, the value you put on owning a home rather than renting and the opportunity you are faced with (assuming you have a property in mind)
If you are selling its similar enough, if you are in no rush to sell then arguably do nothing. If you are in a rush then ask yourself how long do you think it will be before prices are back where they are/were. what will it cost you to wait that long. What are the prices of your next property going to do and whats the net gain/loss in the difference.

Unless you are buying a gasworks apartment for 2M or a 1 bed apartment in Ticknock for 800K then chances are in a couple of years prices will be right back where they were when you bought. Arguably you shouldnt be buying any property that you think will not rise in value. If you are going to buy it anyway and dont care about an increase in value, then you should just uy it anyway and not worry about prices going up or down.

TL;DR
Buy now, the ladder only goes one way long term.

Or Ireland loses corporation tax advantage and it never recovers.

We were a second world country in the 80's before the corporation tax advantage, then we become one of the richest country's because of one tax incentive. What else do we have to justify being one of the richest countries in the world?

Ever watch the film Trading Places, I often think that is what the world is doing to Ireland, just they have not pulled the plug yet... easy come easy go. I certainly would not be taking out a 90% mortgage for 20+ years on the pretenses we will always have this wealth.