Property Market 2020

OttoPilot

fliball123 wrote: »

No sign of rentals drying up anytime soon you have to remember 12 odd years of little or no building, 12 years of increased immigration inward to Ireland, 12 years of people living longer and 12 years of people having more kids. they all need a place to live.

If you bring the virus argument into play and think people will go home, then by that argument there are more Irish people living outside of Ireland than in the country. So by that rule we will need even more housing. People can not have this every way. If Ireland are facing difficulties it means the rest of the world are as the same dynamics and issues are there too.

As for investors where do you put your money stocks are unstable and it is costing an investor to keep money in savings or do you keep your 1 bed apartment in dublin making a profit for you. No need to pay out solicitor fees or EA fees or capital gains tax. For me its a no brainer you keep the property let the Corona virus storm blow out which it will once a proper treatment has been found and that will be sooner rather than later.

Italy is suspending mortgage payments. If it goes that way here, do you really think renters will continue to pay? Why would they, you cant evict them all.

Rainmann

I think even with this virus causing an economic downturn, if you are planning on buying property to rent, I wouldn't be too worried. Yes, the property value may fall in the short term, but rents in Dublin will remain high for the foreseeable future. There just isn't enough supply for what is needed.

beggars_bush

Rainmann wrote: »

I think even with this virus causing an economic downturn, if you are planning on buying property to rent, I wouldn't be too worried. Yes, the property value may fall in the short term, but rents in Dublin will remain high for the foreseeable future. There just isn't enough supply for what is needed.

If people aren't working, rents will fall

Shelga

Wandered over to this thread to see if people were wondering the same stuff as me in regard to property, and sure enough, here you all are, having a nice robust debate! :pac:

I’m FINALLY in a position to buy a place, after several years of waiting to be in a stable job, have savings accumulate, etc etc. I’m 32. Do people think just hold off a bit longer? Is anyone going to be buying anywhere in the next 2 months? So hard to know what’s going to happen.

I’m looking at 2 bed places that I’d be happy to live in for 5-8 years, who knows, maybe forever if it ends up being just me and my cat army. I’m in a very secure job.

Does anyone see any significant price drops in Irish property in the next 12-24 months? I realise I’m asking for some crystal ball predictions here, but hey, it is the Accommodation and Property forum after all, I’m sure there are some lurkers here who’d know more than me...

Sheeps

Finally went sale agreed on my first home after 10 years of saving. Couldn't care less about the highly likely probability that I will be in negative equity. It's probably not a home for life, but it's certainly a home for the next 10 to 15 years.

Padre_Pio

If your offer gets accepted tomorrow, it'll be two months at the earliest till mortgage draw down.

No one knows whats going to happen. While people may be more cautious, remember that building will also be affected.
Supply could get worse and you could have a surge in buyers when things calm down.

Also Brexit hasn't happened yet.
My offer was accepted a few weeks ago. I'm going to plough ahead.

JamesMason

The next 12-24 days are more important.

OttoPilot

Shelga wrote: »

Wandered over to this thread to see if people were wondering the same stuff as me in regard to property, and sure enough, here you all are, having a nice robust debate! :pac:

I’m FINALLY in a position to buy a place, after several years of waiting to be in a stable job, have savings accumulate, etc etc. I’m 32. Do people think just hold off a bit longer? Is anyone going to be buying anywhere in the next 2 months? So hard to know what’s going to happen.

I’m looking at 2 bed places that I’d be happy to live in for 5-8 years, who knows, maybe forever if it ends up being just me and my cat army. I’m in a very secure job.

Does anyone see any significant price drops in Irish property in the next 12-24 months? I realise I’m asking for some crystal ball predictions here, but hey, it is the Accommodation and Property forum after all, I’m sure there are some lurkers here who’d know more than me...

The biggest risk for you from waiting is that house prices go up significantly from here. The only way I see that happening is if the central bank relaxes lending rules which spurs a new segment of domestic buyers. This could happen if the market stagnated because foreign and institutional investors are scared off. Not out of the realms of possibility but unlikely right now I would say. Other than that, I dont see where new money will come from to push prices much higher. What is wage growth like right now?

Edit: I'm saying CB may relax rules if house prices stagnate just because vested interests wont want prices to fall and it will be under the guise of making owning a home easier, which the public wants.

ittakestwo

OttoPilot wrote: »

The biggest risk for you from waiting is that house prices go up significantly from here. The only way I see that happening is if the central bank relaxes lending rules which spurs a new segment of domestic buyers. This could happen if the market stagnated because foreign and institutional investors are scared off. Not out of the realms of possibility but unlikely right now I would say. Other than that, I dont see where new money will come from to push prices much higher. What is wage growth like right now?

Edit: I'm saying CB may relax rules if house prices stagnate just because vested interests wont want prices to fall and it will be under the guise of making owning a home easier, which the public wants.

The CB have those rules to stop people getting to much in debt and ending up with mortgages they cant afford. The CB will not try encourage people to borrow inexcess of what they can afford to help demand.

I worry if FF get into government they will try and dismantle the CB rules to kick start a new boom/bust cycle but hopefully the CB are now independent of political interference??

TheSheriff

Funnily enough, a house we bid nearly 30k under asking on over four months ago came back to us yesterday. The EA practically laughed at us at the time, told us no way would the vendor accept our price.....now they seem willing to sell at this price and we are gonna go back for another viewing on sat.

People getting scared I would think.

I should add, house was previously sale agreed at 460k, two bidders. All have disappeared

OttoPilot

ittakestwo wrote: »

The CB have those rules to stop people getting to much in debt and ending up with mortgages they cant afford. The CB will not try encourage people to borrow inexcess of what they can afford to help demand.

I worry if FF get into government they will try and dismantle the CB rules to kick start a new boom/bust cycle but hopefully the CB are now independent of political interference??

I know why the rules are in place, and yes they are working but that doesn't mean they wont be relaxed in future. FF would definitely support relaxing them, as would SF I imagine in a populist move. Varadkar has also expressed hope that the rules would be relaxed.

Everyone who already owns has a vested interest in making sure property prices keep going up and it would make it easier to borrow for anyone who doesn't own. Mark my words, if there is a slowdown, the rules will be relaxed to encourage demand.

J_1980

Villa05 wrote: »

Ironically enough SF housing policy is very close to Dermot Desmond vision in his Irish times article in which he states that the current government is paying twice as much for housing than it should be.

It looks to me that current Gov housing policy is far more dangerous to the country than SF policy.

I understand why property bulls slate SF at every opportunity as they are well aware that there policies would restore some supply/demand balance thereby deflating exorbitant rents and property prices

I'm not shinner and did not vote for them as other parties had similar policies

House building costs are the same here as in Germany (I’m from Germany I know).

Munich:
https://www.immobilienscout24.de/Suche/de/bayern/muenchen/schwabing/wohnung-kaufen?numberofrooms=2.0-&enteredFrom=one_step_search

3Zi means 3 rooms, ie 2 bedrooms
Dwarfes Dublin and average net incomes are lower than Dublin

Maybe Dermot and MaryLou should go to Germany and teach Irish house building lessons??? How to make it cheaper.
You guys are total jokers. At least the virus will end all this nonsense.

Sunny Disposition

If someone is buying a house just to live in for themselves I wouldn’t rule out going ahead. On the other hand there is no way anyone should buy a rental property in the next few months, it could be well worth waiting.

J_1980

I also think that the virus will devastate rural Ireland’s tourism industry much more than Dublins tech sector.
They can all work from home. Tech stocks are hardly selling off (relative to the massive run ups in last 2y).

JamesMason

TheSheriff wrote: »

Funnily enough, a house we bid nearly 30k under asking on over four months ago came back to us yesterday. The EA practically laughed at us at the time, told us no way would the vendor accept our price.....now they seem willing to sell at this price and we are gonna go back for another viewing on sat.

People getting scared I would think.

I should add, house was previously sale agreed at 460k, two bidders. All have disappeared

You could drop your bid by 60k now.

Woshy

TheSheriff wrote: »

Funnily enough, a house we bid nearly 30k under asking on over four months ago came back to us yesterday. The EA practically laughed at us at the time, told us no way would the vendor accept our price.....now they seem willing to sell at this price and we are gonna go back for another viewing on sat.

People getting scared I would think.

I should add, house was previously sale agreed at 460k, two bidders. All have disappeared

That's what happened with us. We bid 30K under the asking and the estate agent was very polite (no laughing here!) but said the owners wanted asking price and were not willing to negotiate at all. We left our offer on the table but walked away. 4 weeks later we got a call saying there had been no other bidders and asking us if we are still interested. We're about to sign contracts.

Best of luck for the viewing etc!

J_1980

A 30% drop within 10-15 days happened twice this century.
October 2008 obviously and September 2001.
I think another financial crisis is too much of a foregone conclusion. Especially as the whole “Corona Story” aligns much more with 9/11 type of event.

ZX7R

I read an interesting article last night about what to expect about property prices and the bear market at the moment.
The consensus across Europe is property prices will not drop significantly as seller's in general sit on properties rather than sell.
The article interestingly stated buyer's beware of wearing blinkers this is not the same as a property bubble burst or the banking crisis the money is still there it hasn't vanished , it's a simple Case of investors are scared to invest as soon as they see stabilizing in the coronavirous affects ,they will invest . there's money for now is in safe Haven's mainly gold and currency.
Surprisingly America and Ireland were mentioned because of there shortage of housing

Mad_maxx

If you were to gauge the current market using the IRES reit, house prices would be down by a third since the autumn

Glad i never rated those vehicles

Mad_maxx

J_1980 wrote: »

A 30% drop within 10-15 days happened twice this century.
October 2008 obviously and September 2001.
I think another financial crisis is too much of a foregone conclusion. Especially as the whole “Corona Story” aligns much more with 9/11 type of event.

It's a far bigger deal than 9-11

Zenify

There are going to be massive job losses because of this (including my own). That is going to have a knock on effect for a long time to come. People were saying that everyone needs somewhere to live, but if they have no job they cannot pay rent. I work in tourism and I am a potential house buyer, I will not get a mortgage without a job and without a job my savings will get eroded and my financial stability will be effected for a long time to come. I was previously thinking a property crash would be good, I never thought I would lose my job. I am very high up in the company I work and also thought I was secure but this is an extraordinary situation we are now facing.

I honestly can not see a bank approving a mortgage in the current climate, they are in damage control mode right now.

nerrad01

conversely it may be a good time to buy, demand will drop off while buyers are spooked due to the uncertainty and as long as your job is secure and plan on buying a long term home, the process may be more straight forward. Although supply willbe limited with people not putting places on the market due to the infinitely more worrying issues going on

beggars_bush

we're sale agreed on a house as a an investment
think we'll be pulling out.

nerrad01

beggars_bush wrote: »

we're sale agreed on a house as a an investment
think we'll be pulling out.

yep madness buying an investment now, a home for 5-10 years fair enough

Assetbacked

A tourism crisis means an Airbnb crisis which can help bring those properties into long term rental, assuming the owners can't afford to leave them sitting idle. Now is the time for the government to strongly enforce a vacant property tax.

lastusername

Zenify wrote: »

There are going to be massive job losses because of this (including my own). That is going to have a knock on effect for a long time to come. People were saying that everyone needs somewhere to live, but if they have no job they cannot pay rent. I work in tourism and I am a potential house buyer, I will not get a mortgage without a job and without a job my savings will get eroded and my financial stability will be effected for a long time to come. I was previously thinking a property crash would be good, I never thought I would lose my job. I am very high up in the company I work and also thought I was secure but this is an extraordinary situation we are now facing.

I honestly can not see a bank approving a mortgage in the current climate, they are in damage control mode right now.

I don't think it's THAT bad, in fairness! If you are in tourism you might lose your job, sure, but same can be said for anyone at any time and if you are very senior then there's a very good chance they'll be looking to keep you to steady the ship. Governments and society are doing what's needed to contain this and it WILL pass like any other viral outbreak.

Numbers may be down now and for the next while, but people will still want to get out and about, especially with brighter and longer days and summer on the horizon. If we can contain and mitigate it over the coming weeks and months then the impact may not be as bad as you'd think, and things will gradually start to climb back up as the year goes on.


Banks will continue to approve mortgages, they are in no way exposed like they were with the 2008 crash.

Assetbacked

Mad_maxx wrote: »

If you were to gauge the current market using the IRES reit, house prices would be down by a third since the autumn

Glad i never rated those vehicles

It is clear from this thread that the investment market is the one prone to a correction moreso than the residential purchase and selling market. IRES shares are in freefall right now, opening today with another 4% drop so far. This is without job losses and without a decrease in demand for their rentals. I think they could be at the beginning of the end of their life. The decision by Green REIT to cash in last year looks ingenius at this stage.

Mad_maxx

Assetbacked wrote: »

It is clear from this thread that the investment market is the one prone to a correction moreso than the residential purchase and selling market. IRES shares are in freefall right now, opening today with another 4% drop so far. This is without job losses and without a decrease in demand for their rentals. I think they could be at the beginning of the end of their life. The decision by Green REIT to cash in last year looks ingenius at this stage.

It has very little to do with demand for their rentals, REITs are stocks at the end of the day, they get sold during times like this

Assetbacked

Mad_maxx wrote: »

It has very little to do with demand for their rentals, REITs are stocks at the end of the day, they get sold during times like this

They are not just getting sold, they are getting dumped at this rate!

FernandoTorres

ZX7R wrote: »

I read an interesting article last night about what to expect about property prices and the bear market at the moment.
The consensus across Europe is property prices will not drop significantly as seller's in general sit on properties rather than sell.
The article interestingly stated buyer's beware of wearing blinkers this is not the same as a property bubble burst or the banking crisis the money is still there it hasn't vanished , it's a simple Case of investors are scared to invest as soon as they see stabilizing in the coronavirous affects ,they will invest . there's money for now is in safe Haven's mainly gold and currency.
Surprisingly America and Ireland were mentioned because of there shortage of housing

Was the article written by a property company? It's a pretty simplistic view to say that people will just sit on their property. If things get really bad, companies start to fold, people lose jobs and people are forced to sell. That's before looking at the virus which targets the elderly, the biggest owners of property in Ireland. Not saying any of this is a given but certainly a lot more realistic than it looked last month.