Property Market 2020

nerrad01

SozBbz wrote: »

I think some of the rhetoric about Covid19 and the Irish property market is overstated and premature.

Yes its going to impact on certain supply chains and fast fashion in particular, but the sale of 2nd hand houses in Ireland - a country yet to record a single case? All virus strains run a course, this is not something thats going to be around long term. It was be disruptive for a number of months, but it will end.

People are reacting like this is the black death. Our standards of hygiene and sanitation in this day and age mean we can contain a virus much more effectivly than hundreds of years ago. I really don't think this is going to kill a significant number of people. People die all the time from regular flu, car crashes etc in far greater numbers.

while i agree with you in some parts, CoVid has a mortality rate 20x higher than the flu, its more infectious and a vaccine is many months away. We have an effective vaccine program against the flu and are ahead of it each year.

this is new territory and the economic impact could be devastating, never mind the calamity of the HSE trying to deal with it.

Sleepy

Being brutal about the numbers, a pandemic level outbreak of Covid 19 in Ireland would probably help our housing situation. For the most part, it's only fatal to the elderly and imuno-compromised so would, in theory, leave our working population pretty much unscathed whilst freeing up housing units (both privately owned and social) to be re-allocated by councils, sold by estates or moved into by those inheriting them.

In the same vein, an old school infantry based land war would do a great job of reducing our numbers of long term unemployed young men as the most likely group to be conscripted and butchered at the front lines with those who made it home less likely to fall back into a life of welfare (having been up-skilled by the military).

Historically speaking, the Black Death lead to the effective economic emancipation of millions.

That's not to say we should be hoping for these things, but horrific death tolls can create the seeds of prosperity for the survivors...

Bass Reeves

SozBbz wrote: »

I think some of the rhetoric about Covid19 and the Irish property market is overstated and premature.

Yes its going to impact on certain supply chains and fast fashion in particular, but the sale of 2nd hand houses in Ireland - a country yet to record a single case? All virus strains run a course, this is not something thats going to be around long term. It was be disruptive for a number of months, but it will end.

People are reacting like this is the black death. Our standards of hygiene and sanitation in this day and age mean we can contain a virus much more effectivly than hundreds of years ago. I really don't think this is going to kill a significant number of people. People die all the time from regular flu, car crashes etc in far greater numbers.

While in the developed world it worse effect may be mitigated it is in poorer regions where it effects will really be felt. While our hygiene standards are much more developed compared to hundred of years ago our mobility is the problem. As we have seen with COVID 19 its has spread across the world in 4-5 weeks. China seems to have mitigated the worst effects in its area but it is questionable that other Asian countries will be as sucessfull in its control and what effects it may have in area's in Africa or South America. It is the lock down effect that it may have over the next 6 months while a vaccine is developed

SozBbz

AlmightyCushion wrote: »

I hate this argument. Many Irish (and many non-Irish living here) have no problem with apartment living. Plenty more would prefer to have a back garden but are more than willing to sacrifice it for an easier life/commute. People are living where ever they can right now. They'll take whatever they can get whether it has a garden or not. There isn't a single apartment block that is struggling to be filled (whether rentals or purchases) because people won't live there because they don't have a garden. It doesn't happen. People might prefer houses but lots will live in apartments.

Build apartments and good transport links for them and people will live there. The problem is every time someone wants to build an apartment block, loads of people complain. The problem is whenever the state wants to build the transport links, loads of people complain.

Sorry but thats not the European model. I'm talking about Family style apartments, with ameneties etc for long term family life. We need families living in our citites, not on their outskirts, and livnig in them as a long term soltion, not as a step to a house down the line.

People in Ireland are happy to live in apartments in their 20's etc, but once they marry and have children, the yern for a 3/4bed semi is strong.

Developers don't build this type of property because theres no perceived market for it. They build estates of houses becuase they know they can sell it.

Mic 1972

Covid will shake the system, even if only for a short while. The virus affected some of the wealthiest Italian regions, how many of you would buy a house there right now? Foreign money will be invested somewhere else

fliball123

Mic 1972 wrote: »

Covid will shake the system, even if only for a short while. The virus affected some of the wealthiest Italian regions, how many of you would buy a house there right now? Foreign money will be invested somewhere else

The corona virus will only go to Ireland...by any chance to you think that it might go to other areas ergo where will the foreign money go if everywhere has the same chance of getting it

The_Conductor

Mic 1972 wrote: »

Covid will shake the system, even if only for a short while. The virus affected some of the wealthiest Italian regions, how many of you would buy a house there right now? Foreign money will be invested somewhere else

Having experience of buying a property in Italy- its not an experience I'd wish on my worst enemy. If someone wants to buy a property there- they will leap through the various hurdles to do so- I can't see Corvid having any lasting effect on the market.

Mic 1972

The_Conductor wrote: »

Having experience of buying a property in Italy- its not an experience I'd wish on my worst enemy. If someone wants to buy a property there- they will leap through the various hurdles to do so- I can't see Corvid having any lasting effect on the market.

The uncertainty about what may or may not happen is what i think will slow down investments, nothing has a lasting effect on markets in the end. They just evolve

fliball123

Mic 1972 wrote: »

The uncertainty about what may or may not happen is what i think will slow down investments, nothing has a lasting effect on markets in the end. They just evolve

But sure does the market not work on uncertainty, if it was always certain then there would be no risk and when there is no risk there is very little reward. There is always an element of risk in the markets or in any substantial purchase such as a house regardless of what way the perceived market is going

pearcider

SozBbz wrote: »

I think some of the rhetoric about Covid19 and the Irish property market is overstated and premature.

Yes its going to impact on certain supply chains and fast fashion in particular, but the sale of 2nd hand houses in Ireland - a country yet to record a single case? All virus strains run a course, this is not something thats going to be around long term. It was be disruptive for a number of months, but it will end.

People are reacting like this is the black death. Our standards of hygiene and sanitation in this day and age mean we can contain a virus much more effectivly than hundreds of years ago. I really don't think this is going to kill a significant number of people. People die all the time from regular flu, car crashes etc in far greater numbers.

You remind me of comical Ali during the second gulf war. Nothing to see here. Keep taking out your 35 year mortgages with interest rates all time lows. Everything will be fine.

This virus is nothing like the flu. Unlike the flu, we have no herd immunity as it is novel and no chance of developing and deploying a vaccine before next winter. It’s an extremely serious pandemic which is why Wuhan a city of 10 million is under military quarantine and China is in total lockdown. Clearly it’s not just the flu as they don’t quarantine millions of people for just the flu.

It’s also going to completely lock down South Korea in the next few days as they have over 1000 cases. These two economies alone are enough to halt the global economy for a few months. The GDP numbers are going to be horrific and the stock markets will tank over the next few months. This will translate into our property market as there is no escape for our highly globalized economy. Let’s wait for daft rent report and property sales this year though. I’m predicting a bloodbath.

The Great Depression is here and there is nothing anyone can do about it. I would also say this new virus was simply the trigger to bring down the house of cards that is the worlds financial system. If it wasn’t the virus it would have been some other thing. You can’t escape 250 trillion and counting in debt.

fliball123

pearcider wrote: »

You remind me of comical Ali during the second gulf war. Nothing to see here. Keep taking out your 35 year mortgages with interest rates all time lows. Everything will be fine.

This virus is nothing like the flu. Unlike the flu, we have no herd immunity as it is novel and no chance of developing and deploying a vaccine before next winter. It’s an extremely serious pandemic which is why Wuhan a city of 10 million is under military quarantine and China is in total lockdown. Clearly it’s not just the flu as they don’t quarantine millions of people for just the flu.

It’s also going to completely lock down South Korea in the next few days as they have over 1000 cases. These two economies alone are enough to halt the global economy for a few months. The GDP numbers are going to be horrific and the stock markets will tank over the next few months. This will translate into our property market as there is no escape for our highly globalized economy. Let’s wait for daft rent report and property sales this year though. I’m predicting a bloodbath.

The Great Depression is here and there is nothing anyone can do about it. I would also say this new virus was simply the trigger to bring down the house of cards that is the worlds financial system. If it wasn’t the virus it would have been some other thing. You can’t escape 250 trillion and counting in debt.

As apposed to paying more for rent than a mortgage for 35 years and when you retire have no house to stay in when you finish working. There is no way there will a recession as bad as 2008 that was once in a century event. There has always been debt. There has always been viruses SARS, Foot and mouth, Etc, famine over the years and guess what if you look at the price of a house now as apposed to 35 years ago house prices have gone up and you can bet just with natural inflation in 35 years time the price will be more than what it is now. Looking at it in those simple terms if anyone has the finance to buy they should buy

KilOit

pearcider wrote: »

You remind me of comical Ali during the second gulf war. Nothing to see here. Keep taking out your 35 year mortgages with interest rates all time lows. Everything will be fine.

This virus is nothing like the flu. Unlike the flu, we have no herd immunity as it is novel and no chance of developing and deploying a vaccine before next winter. It’s an extremely serious pandemic which is why Wuhan a city of 10 million is under military quarantine and China is in total lockdown. Clearly it’s not just the flu as they don’t quarantine millions of people for just the flu.

It’s also going to completely lock down South Korea in the next few days as they have over 1000 cases. These two economies alone are enough to halt the global economy for a few months. The GDP numbers are going to be horrific and the stock markets will tank over the next few months. This will translate into our property market as there is no escape for our highly globalized economy. Let’s wait for daft rent report and property sales this year though. I’m predicting a bloodbath.

The Great Depression is here and there is nothing anyone can do about it. I would also say this new virus was simply the trigger to bring down the house of cards that is the worlds financial system. If it wasn’t the virus it would have been some other thing. You can’t escape 250 trillion and counting in debt.

Do you recommend we crack each other’s heads open and feast on the goo inside?

coolshannagh28

fliball123 wrote: »

As apposed to paying more for rent than a mortgage for 35 years and when you retire have no house to stay in when you finish working. There is no way there will a recession as bad as 2008 that was once in a century event. There has always been debt. There has always been viruses SARS, Foot and mouth, Etc, famine over the years and guess what if you look at the price of a house now as apposed to 35 years ago house prices have gone up and you can bet just with natural inflation in 35 years time the price will be more than what it is now. Looking at it in those simple terms if anyone has the finance to buy they should buy

This seems logical however there is a school of thought out there that maintains that the 2007 crash was never properly resolved ie QE and historical low interest rates have masked the huge structural issues which remain unresolved , consumer debt may be lower but corporate and Govt debt remains too high and stock markets have roared on buybacks and exuberance around tech. It could be a different type of crash but terminal unless debt is reset as the public would never consent to bailouts similar to 07 . In a reset scenario who will benefit ?

beauf

pearcider wrote: »

...The Great Depression is here and there is nothing anyone can do about it. I would also say this new virus was simply the trigger to bring down the house of cards that is the worlds financial system. If it wasn’t the virus it would have been some other thing. You can’t escape 250 trillion and counting in debt...

It's all going pear shaped eh....

pearcider

fliball123 wrote: »

As apposed to paying more for rent than a mortgage for 35 years and when you retire have no house to stay in when you finish working. There is no way there will a recession as bad as 2008 that was once in a century event. There has always been debt. There has always been viruses SARS, Foot and mouth, Etc, famine over the years and guess what if you look at the price of a house now as apposed to 35 years ago house prices have gone up and you can bet just with natural inflation in 35 years time the price will be more than what it is now. Looking at it in those simple terms if anyone has the finance to buy they should buy

2008 was not a once in a century event. These credit crunches happen every ten years or so. Read up on long term capital management which was bailed out by the big banks and averted a systemic collapse of the financial system in 1998.

You are forgetting that the crisis of 2008 was “solved” by cleaning up the banks balance sheets with junk mortgages and putting this on the feds balance sheet where they remain. When the fed tried to unwind these positions (quantitive tightening) the markets began to crash so now we are stuck with a massive bad balance sheet which is beginning to grow again. Let’s not forget the banks were also bailed out to the tune of 29 trillion. Interest rates were cut to zero. 12 years later, there simply isn’t the space to act like this again.

All this extraordinary intervention by governments has reinflated the stock market and property market for ten years but now these tools are no longer available. Interest rates are negative and governments are broke. There will be no second bailout without catastrophic consequences for the financial system. The credit markets are already experiencing problems with this debt explosion see the repo crisis ongoing since Q3 2019. And the recession is staring us in the face.

So you can pretend everything is grand but the fact is you’re wrong.

SozBbz

fliball123 wrote: »

As apposed to paying more for rent than a mortgage for 35 years and when you retire have no house to stay in when you finish working. There is no way there will a recession as bad as 2008 that was once in a century event. There has always been debt. There has always been viruses SARS, Foot and mouth, Etc, famine over the years and guess what if you look at the price of a house now as apposed to 35 years ago house prices have gone up and you can bet just with natural inflation in 35 years time the price will be more than what it is now. Looking at it in those simple terms if anyone has the finance to buy they should buy

Exactly.

SozBbz

pearcider wrote: »

2008 was not a once in a century event. These credit crunches happen every ten years or so. Read up on long term capital management which was bailed out by the big banks and averted a systemic collapse of the financial system in 1998.

You are forgetting that the crisis of 2008 was “solved” by cleaning up the banks balance sheets with junk mortgages and putting this on the feds balance sheet where they remain. When the fed tried to unwind these positions (quantitive tightening) the markets began to crash so now we are stuck with a massive bad balance sheet which is beginning to grow again. Let’s not forget the banks were also bailed out to the tune of 29 trillion. Interest rates were cut to zero. 12 years later, there simply isn’t the space to act like this again.

All this extraordinary intervention by governments has reinflated the stock market and property market for ten years but now these tools are no longer available. Interest rates are negative and governments are broke. There will be no second bailout without catastrophic consequences for the financial system. The credit markets are already experiencing problems with this debt explosion see the repo crisis ongoing since Q3 2019. And the recession is staring us in the face.

So you can pretend everything is grand but the fact is you’re wrong.

You ended your post by saying ‘fact’ so therefore you must be unequivocally correct.

Assetbacked

pearcider wrote: »

2008 was not a once in a century event. These credit crunches happen every ten years or so. Read up on long term capital management which was bailed out by the big banks and averted a systemic collapse of the financial system in 1998.

You are forgetting that the crisis of 2008 was “solved” by cleaning up the banks balance sheets with junk mortgages and putting this on the feds balance sheet where they remain. When the fed tried to unwind these positions (quantitive tightening) the markets began to crash so now we are stuck with a massive bad balance sheet which is beginning to grow again. Let’s not forget the banks were also bailed out to the tune of 29 trillion. Interest rates were cut to zero. 12 years later, there simply isn’t the space to act like this again.

All this extraordinary intervention by governments has reinflated the stock market and property market for ten years but now these tools are no longer available. Interest rates are negative and governments are broke. There will be no second bailout without catastrophic consequences for the financial system. The credit markets are already experiencing problems with this debt explosion see the repo crisis ongoing since Q3 2019. And the recession is staring us in the face.

So you can pretend everything is grand but the fact is you’re wrong.

Bringing this back to Irish property, are those exposed not the foreign investors and not the Irish people? I think it is possible to distinguish between property prices falling for residential properties due to this global correction and the fact Irish property prices are pretty unaffordable without significant leverage so are due a natural correction regardless of the global economic apocalypse you are forecasting.

The loss to the exchequer of corporate tax revenue is already being advised as something to insulate against by the likes of the ESRI but in any event could be offset somewhat by reducing the massive handouts in the form of tax credits, social welfare benefits, property tax enforcement etc.

JamesMason

SozBbz wrote: »

I think some of the rhetoric about Covid19 and the Irish property market is overstated and premature.

Yes its going to impact on certain supply chains and fast fashion in particular, but the sale of 2nd hand houses in Ireland - a country yet to record a single case? All virus strains run a course, this is not something thats going to be around long term. It was be disruptive for a number of months, but it will end.

People are reacting like this is the black death. Our standards of hygiene and sanitation in this day and age mean we can contain a virus much more effectivly than hundreds of years ago. I really don't think this is going to kill a significant number of people. People die all the time from regular flu, car crashes etc in far greater numbers.

Have you spent much time in a Dublin Hospital Emergency Dept lately? A virus outbreak would be catastrophic

fliball123

coolshannagh28 wrote: »

This seems logical however there is a school of thought out there that maintains that the 2007 crash was never properly resolved ie QE and historical low interest rates have masked the huge structural issues which remain unresolved , consumer debt may be lower but corporate and Govt debt remains too high and stock markets have roared on buybacks and exuberance around tech. It could be a different type of crash but terminal unless debt is reset as the public would never consent to bailouts similar to 07 . In a reset scenario who will benefit ?

Debt to GDP ratio in the country is coming down year on year, we finally balanced the books last year. The lending is based on a better footing as in no more 100 or 110% loans which was crazy also you need 10% for FTB or 20% if not. The thing that people forget is it is crazy hard to get someone out of their family home , I know of people who have not paid a penny on their mortgage for nearly 10 years and the bank cant get them out. There is no other country in the world that offers this. There is no way debt will be reset there is too much moral hazard issues. People who dont take risks on large financial purchases should not cover those who do

fliball123

pearcider wrote: »

2008 was not a once in a century event. These credit crunches happen every ten years or so. Read up on long term capital management which was bailed out by the big banks and averted a systemic collapse of the financial system in 1998.

You are forgetting that the crisis of 2008 was “solved” by cleaning up the banks balance sheets with junk mortgages and putting this on the feds balance sheet where they remain. When the fed tried to unwind these positions (quantitive tightening) the markets began to crash so now we are stuck with a massive bad balance sheet which is beginning to grow again. Let’s not forget the banks were also bailed out to the tune of 29 trillion. Interest rates were cut to zero. 12 years later, there simply isn’t the space to act like this again.

All this extraordinary intervention by governments has reinflated the stock market and property market for ten years but now these tools are no longer available. Interest rates are negative and governments are broke. There will be no second bailout without catastrophic consequences for the financial system. The credit markets are already experiencing problems with this debt explosion see the repo crisis ongoing since Q3 2019. And the recession is staring us in the face.

So you can pretend everything is grand but the fact is you’re wrong.

Hang it when was the last time this country cut ps pay and pensions .it has never done so thats how bad things got that things that were considered "off the table" had to be looked at. When was the last time the country got bailed out for having no money?? ans = NEVER. I am not saying there has not been up and downs or there will not be future ups and downs but 2008 was the biggest sh1t show ever seen in this country. The banks over lent in 2008 which was a major part as to why things went bad. This time the dynamics are different and property is more insulated due to the last 12 years or so anyone had got a mortgage had to have more skin in the game to get that mortgage from the bank. Also the FED still have control of interest rates and they will not be going up anytime soon so cheap credit and current loans will remain payable for the forseeable future. You dont have a crystal ball and you can pretend that everything is gone pear shaped , yet you and I and 1.4 million people will get up in the morning , have their breaky (maybe have a chocy pancake it might make you feel better about things) and go to work.

fliball123

JamesMason wrote: »

Have you spent much time in a Dublin Hospital Emergency Dept lately? A virus outbreak would be catastrophic

there does not need to be an outbreak they are already catastrophic thats one thing i can agree with you but what does that have to do with property prices.

coolshannagh28

fliball123 wrote: »

Debt to GDP ratio in the country is coming down year on year, we finally balanced the books last year. The lending is based on a better footing as in no more 100 or 110% loans which was crazy also you need 10% for FTB or 20% if not. The thing that people forget is it is crazy hard to get someone out of their family home , I know of people who have not paid a penny on their mortgage for nearly 10 years and the bank cant get them out. There is no other country in the world that offers this. There is no way debt will be reset there is too much moral hazard issues. People who dont take risks on large financial purchases should not cover those who do

Im referring to corporate and government debt outside of Ireland in the main which has probably become too big for a bailout and I don't think a bailout would be feasible or tolerable. Moral hazard is for the little people.

L1011

fliball123 wrote: »

Hang it when was the last time this country cut ps pay and pensions .it has never done so thats how bad things got that things that were considered "off the table" had to be looked at.

In previous times when things were extremely tight; they could just not increase them and they'd be inflated down within months.

We had months of -7% 'inflation' during the crash. We had annual figures of 18% for some years in the 1980s.

fliball123

fliball123 wrote: »

Hang it when was the last time this country cut ps pay and pensions .it has never done so .

Eh yes it has. 2010.

fliball123

Deleted User wrote: »

Eh yes it has. 2010.

thats the point I was making that the recession in 2008 was so bad that for the first time ever ps pay had to be cut

PommieBast

Bass Reeves wrote: »

China seems to have mitigated the worst effects in its area but it is questionable that other Asian countries will be as sucessfull in its control and what effects it may have in area's in Africa or South America. It is the lock down effect that it may have over the next 6 months while a vaccine is developed

China tried to cover it up, and I have absolutely no doubt they are still massively understating the figures. It is how the place operates.

The_Conductor

PommieBast wrote: »

China tried to cover it up, and I have absolutely no doubt they are still massively understating the figures. It is how the place operates.

True.
I think at first they thought they could brush it under the carpet- but it exploded out of control. It seems to be a lot more virulent that SARS was- even if the fatality level is a lot lower (roughly 3%). One way or the other- looks like its a matter of when, not if, before we have an Irish outbreak- and given the midterm shenanigans- it's likely in the next day or so here...……

With respect of housing- I don't see how it'll have any immediate impact on the market- the area of most constraint is the new housing market- and fewer than 1-in-5 of new builds are making the open market at all- Corvid isn't going to change that salient point. Fewer than 4,000 out of over 20,000 newbuilds were available on the open market last year. It doesn't really matter how people try to spin it- Corvid simply isn't relevant to purchasers of new property- who are chasing an incredibly constrained supply.

We need policies to prioritise property for the open market- rather than the rental market- and we also need to revisit HTB- as its completely misfiguring the new market with inflated prices. From the perspective of FTBs- HTB is simply a mechanism so they don't need as large a deposit- they happily pay an inflated price, as the deposit requirement is lower. This is a nutty situation- to say nothing of how unfair it is on subsequent buyers who are hobbled with enhanced deposit requirements.

Corvid may call a halt to activity in the sector for a few weeks/months- but ultimately, isn't going to make much of a difference to anything, one way or another.

AlmightyCushion

The_Conductor wrote: »

With respect of housing- I don't see how it'll have any immediate impact on the market- the area of most constraint is the new housing market- and fewer than 1-in-5 of new builds are making the open market at all- Corvid isn't going to change that salient point. Fewer than 4,000 out of over 20,000 newbuilds were available on the open market last year. It doesn't really matter how people try to spin it- Corvid simply isn't relevant to purchasers of new property- who are chasing an incredibly constrained supply.

You keep stating misleading or just straight out wrong figures for this. 21,000 new builds were provided last year. The state took 4,400 of them (which seeing as the state has to get 20% of all new developments this shouldn't be too surprising of a figure). Investment funds only took 3,600. 5,000 were self builds. That leaves a remainder of about 8,000.

So, 2 in 5 hit the open market. Even using hitting the open market as a metric is misleading as it doesn't take into account self builds which made up 25% of new builds and the mandatory 20% social housing.

SozBbz

JamesMason wrote: »

Have you spent much time in a Dublin Hospital Emergency Dept lately? A virus outbreak would be catastrophic

No, thankfully I'm perfectly healthy. But I don't need to to know they're struggling.

But tell me, what does it have to do with property prices? Are you suggesting a significant portion of the population will die ala a proper good old fashioned plague? This is what I mean by hysterical.

If this was a thread about retail or hospitality industries, then yes I'd agree its going to be a massive factor. But its a thread about the Irish property market, and this virus will run its course and people will still want to buy a place to live.

As for all this talk about another massive recession, even if that happens (i'm not convinced its imminent or going to be massive) but still, would you rather be renting or living with your mammy when that happens, unable to get finance for years because the banks no longer lend.

Sure we basically don't reposes PPRs in this country, you're much better off in your own home.