Property Market 2020

car_radio19834

AlmightyCushion wrote: »

Property completions have been increasing at double digit percentage rates over the past couple of years. That's not pitiful.

Construction is slowing down already...

car_radio19834

Interested Observer wrote: »

1. What difference does that make? It's sill an increase in supply, they're still places for people to live.

2. Is it even true? It doesn't appear if you know or not.

Oh dear.

There's thousands of people out there who want to buy, but can't because the supply is not there.

For example, me. So obviously, that's one point.

Second, when cuckoo funds own so much property, they set the rates, not the market.

The funds have massive finance, so they set the market rate.

So they can leave their 2k a month asking price there for months without anyone because they're not relying on the monthly income as they care about the capital gain first and foremost.

Whereas the landlord with 3 or 4 properties needs cashflow. If they're not getting 2k a month, they'll drop to 1500 a month to get some money,

People need to wake up to this. but I think the people who are defending them own their own houses so they don't give two ****s about renters.

19233974

Interested Observer wrote: »

1. What difference does that make? It's sill an increase in supply, they're still places for people to live.

2. Is it even true? It doesn't appear if you know or not.

because there is hardly any new build housing stock for sale - forcing people to rent at exorbitant rental prices. The current system is essentially trapping people in the rental system. Im trying to find the figures i seen previously which proves this.

Its an increase in supply, but being used in a way to maximise profits and not solve the housing crisis.

J_1980

car_radio19834 wrote: »

Oh dear.

There's thousands of people out there who want to buy, but can't because the supply is not there.

For example, me. So obviously, that's one point.

Second, when cuckoo funds own so much property, they set the rates, not the market.

The funds have massive finance, so they set the market rate.

So they can leave their 2k a month asking price there for months without anyone because they're not relying on the monthly income as they care about the capital gain first and foremost.

Whereas the landlord with 3 or 4 properties needs cashflow. If they're not getting 2k a month, they'll drop to 1500 a month to get some money,

People need to wake up to this. but I think the people who are defending them own their own houses so they don't give two ****s about renters.

Good point.
But Ireland is massively dependent on foreign cash inflows to balance the current accounts. The Irish banking system has negative money supply creation (ie more debt gets repaid than taken out).

AlmightyCushion

car_radio19834 wrote: »

Construction is slowing down already...

https://www.irishexaminer.com/breakingnews/business/housing-construction-jumps-40-in-december-with-activity-concentrated-on-dublin-and-cork-977345.html

In December, new residential units under construction were 40% higher than the December before it.

car_radio19834

AlmightyCushion wrote: »

https://www.irishexaminer.com/breakingnews/business/housing-construction-jumps-40-in-december-with-activity-concentrated-on-dublin-and-cork-977345.html

In December, new residential units under construction were 40% higher than the December before it.

And how many sold to the open market.

Marcusm

car_radio19834 wrote: »

And how many sold to the open market.

Your posts smack of a home ownership crisi not an accommodation crisis. Fact is, the funds are supplying finance which would othrwsie not be available and the rate of pick up of housing supply would not have happened without them irrrespective of individual interests/politics.

THe logical corrollary of your argument is that everytime a tenanted house is sold to an owner-occupier there is loss of housing supply to tenants, i.e. a one-sided analysis.

19233974

Marcusm wrote: »

Your posts smack of a home ownership crisi not an accommodation crisis. Fact is, the funds are supplying finance which would othrwsie not be available and the rate of pick up of housing supply would not have happened without them irrrespective of individual interests/politics.

THe logical corrollary of your argument is that everytime a tenanted house is sold to an owner-occupier there is loss of housing supply to tenants, i.e. a one-sided analysis.

well it dosent have to 100% one or the other - why not create a balance where these funds still get to build-to-let, make their very healthy returns but a certain % should be sold therefore creating some supply.

but this will never happen unless govt. policy forces this - nothing would have ever changed under FG and an entire generation would have been trapped in the rental trap

Assetbacked

The State can borrow on the international markets at zero cost. This can be used in lieu of "foreign money" to build social housing and would be better than handing over millions to an investment fund in the form of rental assistance.

Mad_maxx

Assetbacked wrote: »

The State can borrow on the international markets at zero cost. This can be used in lieu of "foreign money" to build social housing and would be better than handing over millions to an investment fund in the form of rental assistance.

The state won't borrow at near zero if the next government swings sharply left, bond yields will rise

Why not try and entice some of the hundred billion plus sitting in deposit accounts

Assetbacked

Mad_maxx wrote: »

The state won't borrow at near zero if the next government swings sharply left, bond yields will rise

Why not try and entice some of the hundred billion plus sitting in deposit accounts

SF are centre left so there is no "sharp swinging left" and they won't even be in government by themselves or with the actual left-wing headbangers.

19233974

ive been trying to buy for the last year and havent been able to, im lucky in that my rent isnt too insane so think ill definitely hold off and see how this pans out following the election result. Whatever way you cut it, supply is going to be ramped up and there will be a move away from institutional investors controlling the market

The_Conductor

I don't understand why people imagine that supply is going to be ramped up.
We built almost 21k units last year- which is roughly the supply that Sinn Féin suggested they would construct- they are not undertaking to do anything that hasn't been done...…… (other than move construction out of the private sector and back into the public sector).

I just don't see any massive change happening.

AlmightyCushion

Assetbacked wrote: »

The State can borrow on the international markets at zero cost. This can be used in lieu of "foreign money" to build social housing and would be better than handing over millions to an investment fund in the form of rental assistance.

That money still has to be paid back even if it is borrowed at low rates. Plus if we borrow a lot that will likely be seen as riskier and push our rates up.

l5auim2pjnt8qx

If there is a Will there is a way is the olde saying,much public housing is much needed in this country which as been largely ignored BY FG/FF in the last 20 years.Neither of these parties have or had the creative Will for this change.

At the moment in Dublin West I see blocks of Social Charity blocks/developments going up and equally for Corporations,this in itself is a total mess and goes against the plannning agreements of this country where a certain percentage should be distributed approximately, what we are seeing are the ghetto's of the future as Dublin West is seen somewhat of a dumping ground for Social Housing by FG & Councils and Wealthier areas in ,South Dublin and Wicklow are still using loopholes to avoid/discriminate against Social Housing.

Whatever government does get in I hope for the sake of the country that is more left wing than the extreme dangerous right wing we have seen for the last 20 years.China was able to build a Hospital in 10 days and bed 1,000 people, fast tracking is needed to build social housing distributed in WEALTHIER AREA'S
to avoid inequality & discrimination which is still endemic particularly by the wealthy in our society.
Millions should be extracted from the corporations with immediate effect as they are just a parasite in our society and should be used for the large scale public housing operation,there won't be a flight of Corporations leaving the country as these Corporations are locked for at least another 5 years and it should put the breaks on any new ones looking to come into the country as they are not needed.

We also need to import builder/developers/from other countries namely China
and encourage these new developers to take on 50 percent young Irish Citizens as apprenticeships.....The country needs Radical Change and without a Radical New Government these changes won't happen.....what this means for property prices and rental figures in the future has yet to be played out but it is starting to look POSITIVE for the young.

dubrov

The_Conductor wrote:

I just don't see any massive change happening.

I guess it all comes down to whether you believe the government can build houses cheaper than the private sector plus their profit.

Recent history suggests no by a long way

Assetbacked

AlmightyCushion wrote: »

That money still has to be paid back even if it is borrowed at low rates. Plus if we borrow a lot that will likely be seen as riskier and push our rates up.

The alternative is for the State to assist with the payment of rents which will end up costing more in the long run but the State won't even own the asset.

OwlsZat

Assetbacked wrote: »

The alternative is for the State to assist with the payment of rents which will end up costing more in the long run but the State won't even own the asset.

The state has capital and land. It must build homes. Deciding the state would stop building housing at a time when labor was cheapest was a monumental mistake, one that partly cost the Government their position.

OwlsZat

dubrov wrote: »

I guess it all comes down to whether you believe the government can build houses cheaper than the private sector plus their profit.

Recent history suggests no by a long way

The land cost is often free so the state should have no problem. Contract out the work just as the funds do their building. Then setup the contracts so the state doesn't pickup the bill for overruns. That ought to stop the practice of people pricing unrealistically to get the contract and then adding all overruns to the final price.

dubrov

OwlsZat wrote: »

The land cost is often free so the state should have no problem. Contract out the work just as the funds do their building. Then setup the contracts so the state doesn't pickup the bill for overruns. That ought to stop the practice of people pricing unrealistically to get the contract and then adding all overruns to the final price.

Giving away public land is certainly not free. You can only do it once and are cashing in the possible use by future generations for a quick fix now.

The government would certainly tender out the work but it will just be taken up from the existing builder pool. Capacity is growing in the Irish market, but slowly.
Fixed priced contracts sound good but will end up costing more.
Would you prefer to pay 400k fixed price or 300k which doesn't cover unexpected risks? There is no right answer but I suspect any costings have been done at the lower price while the tenders issued will be for a fixed price.

Government requirements tend to be overly onerous as well which bumps up the overall cost even more.

Here are a few examples from Google for a government built scheme There are many other examples out there.

awec

OwlsZat wrote: »

The land cost is often free so the state should have no problem. Contract out the work just as the funds do their building. Then setup the contracts so the state doesn't pickup the bill for overruns. That ought to stop the practice of people pricing unrealistically to get the contract and then adding all overruns to the final price.

Nobody would ever agree to this.

dubrov

Just to summarise the above article on Dublin social housing schemes, the below gives the initial estimates vs current estimates/actual cost excluding council costs
Ballyfermot: 220k Vs 362k
North Inner-City: 233k Vs 420k
Cherry Orchard: 220k Vs 222k

The last project shows it is possible but unlikely

The_Conductor

awec wrote: »

Nobody would ever agree to this.

Lots of contractors agree- its called a fixed price contract- where the price doesn't differ, regardless of the resources or time overruns that occur. This is as opposed to the cost-plus contracts that most of us are familiar with in the Irish public sector- where project delivery balloons beyond any comprehension.

The Irish Times did a good write up on it a while back: https://www.google.ie/url?sa=t&rct=j&q=&esrc=s&source=web&cd=12&cad=rja&uact=8&ved=2ahUKEwi1lbHiu8fnAhWzuXEKHTMjBxsQFjALegQIBBAB&url=https%3A%2F%2Fwww.irishtimes.com%2Fopinion%2Fwith-a-little-care-public-projects-can-cost-much-less-1.442219&usg=AOvVaw12mZLwtwtKLcL5YPNxqtEZ

awec

The_Conductor wrote: »

Lots of contractors agree- its called a fixed price contract- where the price doesn't differ, regardless of the resources or time overruns that occur. This is as opposed to the cost-plus contracts that most of us are familiar with in the Irish public sector- where project delivery balloons beyond any comprehension.

The Irish Times did a good write up on it a while back: https://www.google.ie/url?sa=t&rct=j&q=&esrc=s&source=web&cd=12&cad=rja&uact=8&ved=2ahUKEwi1lbHiu8fnAhWzuXEKHTMjBxsQFjALegQIBBAB&url=https%3A%2F%2Fwww.irishtimes.com%2Fopinion%2Fwith-a-little-care-public-projects-can-cost-much-less-1.442219&usg=AOvVaw12mZLwtwtKLcL5YPNxqtEZ

For large scale property development?

If so, I stand corrected.

Seems like a very risky contract clause for a business to take when dealing with a notoriously inefficient, bureaucratic public sector that pretty much never does anything on time or on budget.

The_Conductor

awec wrote: »

For large scale property development?

If so, I stand corrected.

Most of the contracts that they've trialled this on have been related to road construction and the schools building programme- as opposed to residential property development- but they do have a working model, there is no reason it shouldn't be applied to property construction.

OwlsZat

awec wrote: »

Nobody would ever agree to this.

The private sector runs almost exclusively on these contracts. Sometimes there is a % breakdown or an excess but they are very common.

awec

OwlsZat wrote: »

The private sector runs almost exclusively on these contracts. Sometimes there is a % breakdown or an excess but they are very common.

Big difference doing business with a private business and doing business with the public sector.

Mad_maxx

Assetbacked wrote: »

SF are centre left so there is no "sharp swinging left" and they won't even be in government by themselves or with the actual left-wing headbangers.

FF are centre left

SF are far left

SozBbz

Mad_maxx wrote: »

FF are centre left

SF are far left

Its a scale of leftness.

FF like to lean slightly left, SF are much more to the left, but not as far left as the SolPBP brigade.

Wildly Boaring

The_Conductor wrote: »

Lots of contractors agree- its called a fixed price contract- where the price doesn't differ, regardless of the resources or time overruns that occur. This is as opposed to the cost-plus contracts that most of us are familiar with in the Irish public sector- where project delivery balloons beyond any comprehension.

The Irish Times did a good write up on it a while back: https://www.google.ie/url?sa=t&rct=j&q=&esrc=s&source=web&cd=12&cad=rja&uact=8&ved=2ahUKEwi1lbHiu8fnAhWzuXEKHTMjBxsQFjALegQIBBAB&url=https%3A%2F%2Fwww.irishtimes.com%2Fopinion%2Fwith-a-little-care-public-projects-can-cost-much-less-1.442219&usg=AOvVaw12mZLwtwtKLcL5YPNxqtEZ

Yep happens all the time.
But the client isn't allowed change their mind and add to scope. All Gov departments seem incapable of this.

CAN also be dearer as contractors must "price the risk"