Irish Property Market 2020 Part 2

fliball123

thefridge2006 wrote: »

What has Ireland got to offer that other countries in Europe can't other than Tax incentives and money funnelling?

and don't say English speaking....

English speaking is a big one the logistics of setting up in a country where English is not the first language adds an additional cost. We also have a highly educated work force and we already have a track record of big MNCs successfully opening up here which means the path has been laid for anyone else who wants to do the same.

Roberto_gas

Lads...there is no debate that Dublin did not get the hot cake moves of big companies in the expected quantity due to BREXIT...

I see lots of debate that Dublin benefited...fact is it did not due to lack of infra and housing ! We could have done much better if we had both at par with rest of Europe !

Cyrus

Roberto_gas wrote: »

Lads...there is no debate that Dublin did not get the hot cake moves of big companies in the expected quantity due to BREXIT...

I see lots of debate that Dublin benefited...fact is it did not due to lack of infra and housing ! We could have done much better if we had both at par with rest of Europe !

Some 29 financial services (FS) companies have relocated staff or services from London to Dublin as a result of Brexit, according to a new report. This makes Dublin the most popular relocation site for the sector, with Luxembourg next on 25 and Frankfurt on 24.

cnocbui

Cyrus wrote: »

Some 29 financial services (FS) companies have relocated staff or services from London to Dublin as a result of Brexit, according to a new report. This makes Dublin the most popular relocation site for the sector, with Luxembourg next on 25 and Frankfurt on 24.

I am suspecting there are holdouts that have been waiting for Brexit to have fully happened and be post EU negotiations before they make a move. Likely there are more to come.

Reins

IAmTheReign wrote: »

You're taking one run down house in the estate and using that a yardstick to measure the value of all the surrounding property. There is far bigger differences between the two houses you're comparing than one having an 'appealing front'. Did you even look at the pictures?

One is turnkey. It's well maintained, has a kitted out kitchen, proper quality flooring and a large outbuilding.

The other is, putting it politely, a 'fixer upper'. It's run down, the fittings scream cheap and and it looks like it hasn't seen a lick of paint in the last 10 years. There's visible water damage in the bathroom, and I don't know what caused the staining in the bedroom but I've seen cleaner carpets in skips. And that's just what you can see from the pics.

Realistically how much do you think fully renovating the place would cost? New flooring, new kitchens, new carpets, new bathroom, and the decking and building out the back? Not to mention potentially structural works from water damage.

" The other is, putting it politely, a 'fixer upper'. It's run down, the fittings scream cheap and and it looks like it hasn't seen a lick of paint in the last 10 years. "
This made me laugh! Bar a new bath, the rest wouldn't break the bank to fix up. Not quite the kip you think it is. Doesn't need a new kitchen.

I'm not using "one" house. I'm using the 3 that sold against the one being advertised for 295k. Yes I did look at the pictures as it happens.

Did you bother to look at the pictures of No.30? Minus 50 grand worth of work that house is worth 275k,sold 11 mths ago so yeah still think that estate has seen ridiculous asking prices in one year.

Financesetc.

thefridge2006 wrote: »

What has Ireland got to offer that other countries in Europe can't other than Tax incentives and money funnelling?

and don't say English speaking....

I heard there is something in the water.

cnocbui

Financesetc. wrote: »

I heard there is something in the water.

That's just limescale.

Cantstandsya

fliball123 wrote: »

English speaking is a big one the logistics of setting up in a country where English is not the first language adds an additional cost. We also have a highly educated work force and we already have a track record of big MNCs successfully opening up here which means the path has been laid for anyone else who wants to do the same.

You're talking about multi billion dollar companies that already operate globally. Finding a bilingual executive team to report back to base in the US isn't that hard.

Which EU countries do not have highly educated work forces?

I'm not sure what "a track record of big MNCs opening here" is supposed to mean. Surely all multi national companies have, by definition, experience of successfully opening in different countries?

The thing that Ireland has going for it is low tax. All the rest is PR guff. We do not have a uniquely talented or educated workforce in the EU context and there are scores of executive level professionals who are fluent in English across the continent.

hmmm

Cantstandsya wrote: »

The thing that Ireland has going for it is low tax. All the rest is PR guff. We do not have a uniquely talented or educated workforce in the EU context and there are scores of executive level professionals who are fluent in English across the continent.

It's more than that. Legal system is common law based. Good infrastructure of the types of firms MNCs need, including legal, accounting, audit etc. Reasonably good transport links. Good time zone. Government which wants to do business, and stable political environment (good luck setting up in France or parts of Eastern Europe at the moment). Friendly people. Good telecoms links. Datacentres to choose from.

Cyrus

Cantstandsya wrote: »

there are scores of executive level professionals who are fluent in English across the continent.

you are looking at it far too simplistically,

its not executives that are in short supply, you can fly one in from anywhere, its the people that make up the rest (95%+) of the workforce, on that we have a good cohort of well educated people, and they all speak english.

It matters to the americans.

Financesetc.

Cantstandsya wrote: »

You're talking about multi billion dollar companies that already operate globally. Finding a bilingual executive team to report back to base in the US isn't that hard.

Which EU countries do not have highly educated work forces?

I'm not sure what "a track record of big MNCs opening here" is supposed to mean. Surely all multi national companies have, by definition, experience of successfully opening in different countries?

The thing that Ireland has going for it is low tax. All the rest is PR guff. We do not have a uniquely talented or educated workforce in the EU context and there are scores of executive level professionals who are fluent in English across the continent.

Here here, cheap tax, these big US mutli national phara tech companies are businesses at the end if the day, they are here for profit and profit only. Its big business here for us. While they dont make a whole pile in corporation tax what the companies provide are stable jobs and lots of irish paying tax payers to the tax system (money in) and less people on the dole(money out).
The irish gov will Never entertain increasing corporation tax because every ones knows they (the big companies) will pull the plug and up sticks for pastures new thus Leaving Ireland behind in a very deep dark state of recession.
So ya there here to stay and corp tax wont be increase for the foreseeable.

Bubbaclaus

Wasn't there someone recently claiming that the REITS were dumping property? This news seems to go against that.

https://www.irishtimes.com/business/commercial-property/ires-reit-set-to-acquire-stillorgan-residential-portfolio-for-10-6m-1.4418023?mode=amp

JimmyVik

Roberto_gas wrote: »

Lads...there is no debate that Dublin did not get the hot cake moves of big companies in the expected quantity due to BREXIT...

I see lots of debate that Dublin benefited...fact is it did not due to lack of infra and housing ! We could have done much better if we had both at par with rest of Europe !

Now thats the funniest post of the week
Id say you heard that down the pub, if they were open.

fliball123

Cantstandsya wrote: »

You're talking about multi billion dollar companies that already operate globally. Finding a bilingual executive team to report back to base in the US isn't that hard.

Which EU countries do not have highly educated work forces?

I'm not sure what "a track record of big MNCs opening here" is supposed to mean. Surely all multi national companies have, by definition, experience of successfully opening in different countries?

The thing that Ireland has going for it is low tax. All the rest is PR guff. We do not have a uniquely talented or educated workforce in the EU context and there are scores of executive level professionals who are fluent in English across the continent.

Whatever, the fact is the country has shown that it can be done, a company can open a HQ here with relative ease regardless of the size of the company so for any small to mid sized company in the US (or other Non EU counties) thinking of branching into Europe they will definitely look at the path other high profile companies have gone to say otherwise is complete nonsense. You only have to look at Google, Facebook, Twitter among others not to mention the amount of Pharma we have with an operation here, these companies have come to Ireland and are on the make and are seen as dollar signs to those who wish to get their company up there at the same level. You can play it down all you want but having the know how and reassurance that others have successfully done it before is a huge draw.

PropQueries

Bubbaclaus wrote: »

Wasn't there someone recently claiming that the REITS were dumping property? This news seems to go against that.

https://www.irishtimes.com/business/commercial-property/ires-reit-set-to-acquire-stillorgan-residential-portfolio-for-10-6m-1.4418023?mode=amp

In the same paper, Greystar in apparently putting in a €180 million bid for the 385 units Cairn Homes is building at Griffith Avenue in Marino.

In relation to the Stillorgan purchase, it looks like their buying the 25 remaining apartments that Ires Reit don't own in that development.

Looks like both Greystar and Ires Reit are gearing themselves up to take some or more of that long-term lease agreement money the councils have been splashing around lately.

Link to the Greystar bid for the Griffith Avenue units in the Irish Times is here: https://www.irishtimes.com/business/commercial-property/greystar-in-180m-bid-for-griffith-avenue-apartment-portfolio-1.4418085

donnaille

Roberto_gas wrote: »

Lads...there is no debate that Dublin did not get the hot cake moves of big companies in the expected quantity due to BREXIT...

I see lots of debate that Dublin benefited...fact is it did not due to lack of infra and housing ! We could have done much better if we had both at par with rest of Europe !

Current evidence doesn't back this argument - see this recent EY article: https://www.ey.com/en_uk/news/2020/09/ey-financial-services-brexit-tracker-fs-firms-continue-moving-staff-ahead-of-brexit-deadline

However, Dublin is merely leading for firms considering or have confirmed relocating operations and/or staff to the city 34 in total - it remains to be seen if some of the 34 make sizeable moves.

AssetBacked2

hmmm wrote: »

It's more than that. Legal system is common law based. Good infrastructure of the types of firms MNCs need, including legal, accounting, audit etc. Reasonably good transport links. Good time zone. Government which wants to do business, and stable political environment (good luck setting up in France or parts of Eastern Europe at the moment). Friendly people. Good telecoms links. Datacentres to choose from.

No terror issues with muslims like in other European countries, political stability, neutral stance on matters of conflict, good craic for a few days of board meetings / or coming over as a single, young person for a few years.

Just to add / overlap slightly with that post!

Browney7

PropQueries wrote: »

In the same paper, Greystar in apparently putting in a €180 million bid for the 385 units Cairn Homes is building at Griffith Avenue in Marino.

In relation to the Stillorgan purchase, it looks like their buying the 25 remaining apartments that Ires Reit don't own in that development.

Looks like both Greystar and Ires Reit are gearing themselves up to take some or more of that long-term lease agreement money the councils have been splashing around lately.

Link to the Greystar bid for the Griffith Avenue units in the Irish Times is here: https://www.irishtimes.com/business/commercial-property/greystar-in-180m-bid-for-griffith-avenue-apartment-portfolio-1.4418085

Yup its all gearing up for the state to become the renter of last resort for these blocks. Its genius from the REITs really - put up the apartments for 2200 a month and get no takers, then approach the council and offer to give a "discount" to 85% of the "market" rent that wasn't being achieved in the first place and secure a 20 year state guaranteed cashflow with upward only reviews.

The council/state spins it is deploying significant funds to alleviate the housing crisis and getting a deal versus the market rent despite it being a woeful waste of taxpayers money in the long run compared to direct ownership. It will be just like the Realis deal in Dundrum all over again

Villa05

Browney7 wrote:

Yup its all gearing up for the state to become the renter of last resort for these blocks. Its genius from the REITs really - put up the apartments for 2200 a month and get no takers, then approach the council and offer to give a "discount" to 85% of the "market" rent that wasn't being achieved in the first place and secure a 20 year state guaranteed cashflow with upward only reviews.

Absolutely yet another screw up from a state that was the largest property owner in the world a mere 8 years ago.

These government(s) redefine stupidity

Timing belt

thefridge2006 wrote: »

What has Ireland got to offer that other countries in Europe can't other than Tax incentives and money funnelling?

and don't say English speaking....

Ireland is not the only jurisdiction in Europe with low tax rates. Look at Nederland lux and some of the Eastern European countries have lower tax. Ireland is easy to do business in and has a educated workforce created especially for the mnc. This is beneficial to the economy and part of the reason we have not seen properly prices drop

Marius34

Marius34 wrote: »

Early Prediction: CSO Property Price Index to turn positive for 2020 Q4.
Due to new data and this week’s news, I start to think that I was at some extend wrong with my prediction on crisis impact on Residential Property price, but to other direction, than most have thought.
My prediction was 3-5% decrease, but I start to think that there may not be further decrease.

It might be to early to tell, but looking at the PPR data I see first signs that CSO Property price Index may turn positive for 2020 Q4.
In a week or two, it will be clearer, when there will be more data, thus less chance with errors/anomalies.
Here is from my report on PPR data (Its mostly Median price with some adjustment calculation).

Update 1
Another 2.6K properties has been added in the past 2 weeks on PPR. And the signs for Q4 haven't changed. More confidence in likely increase in property price.

Dublin:



Ireland(ex-Dublin):

Browney7

Browney7 wrote: »

Yup its all gearing up for the state to become the renter of last resort for these blocks. Its genius from the REITs really - put up the apartments for 2200 a month and get no takers, then approach the council and offer to give a "discount" to 85% of the "market" rent that wasn't being achieved in the first place and secure a 20 year state guaranteed cashflow with upward only reviews.

The council/state spins it is deploying significant funds to alleviate the housing crisis and getting a deal versus the market rent despite it being a woeful waste of taxpayers money in the long run compared to direct ownership. It will be just like the Realis deal in Dundrum all over again

Not surprising to see this in the Sunday business post

“ New figures released as part of a parliamentary question asked by Cian O’Callaghan, the Social Democrats TD, has shown that Dún Laoghaire-Rathdown County Council spent more than €2,300 a month per unit to lease social homes from private owners.

The rent being paid per unit is significantly above the rent levels in the Dún Laoghaire-Rathdown area. According to the latest Residential Tenancies Board report, the standardised average rent in the area was €1,800 a month.”

https://www.businesspost.ie/residential/state-pays-2300-a-month-for-social-housing-units-dc3c0910

Hubertj

Browney7 wrote: »

Yup its all gearing up for the state to become the renter of last resort for these blocks. Its genius from the REITs really - put up the apartments for 2200 a month and get no takers, then approach the council and offer to give a "discount" to 85% of the "market" rent that wasn't being achieved in the first place and secure a 20 year state guaranteed cashflow with upward only reviews.

The council/state spins it is deploying significant funds to alleviate the housing crisis and getting a deal versus the market rent despite it being a woeful waste of taxpayers money in the long run compared to direct ownership. It will be just like the Realis deal in Dundrum all over again

Do we know if the state has break clauses in the contracts, price reviews linked to market rate etc? Surely not locked in for term?
Short to medium term what choice do they have? Even if government decided to build 20k social houses how long would it take to deliver? 3,4,5 years or more. Walked themselves into a sh*tshow.

Browney7

Marius34 wrote: »

Update 1
Another 2.6K properties has been added in the past 2 weeks on PPR. And the signs for Q4 haven't changed. More confidence in likely increase in property price.

Dublin:



Ireland(ex-Dublin):

The index may or may not increase - the median increasing doesn't necessarily mean that the index goes up. The latest figures from the BPFI show that new build purchases have made up the highest %s of mortgage drawdowns since 2010 (think it was near 40%).

New build price inflation has outpaced second hand (as per the CSO) this year due to a range of factors (help to buy changes, building standard changes, Covid costs etc) so when the CSO apply their standardisations, the index may not increase.

Median is strong though so an increase looks likely

Browney7

Hubertj wrote: »

Do we know if the state has break clauses in the contracts, price reviews linked to market rate etc? Surely not locked in for term?
Short to medium term what choice do they have? Even if government decided to build 20k social houses how long would it take to deliver? 3,4,5 years or more. Walked themselves into a sh*tshow.

https://www.dublininquirer.com/2019/08/07/council-signs-agreement-to-lease-social-housing-from-bartra - it's an interesting read albeit a year old. The lack of disclosure on the rent to be paid doesn't inspire confidence.

What's also interesting is that Bartra received funding from Activate Capital (From their website "Founded in 2015 in partnership with the Irish sovereign development fund (ISIF)") which is backed by the strategic Ireland investment fund which is owned by Joe taxpayer.

So one arm of the state helped fund construction of a project to then be leased back to a different arm of the state....interesting concept for delivering housing

Marius34

Browney7 wrote: »

The index may or may not increase - the median increasing doesn't necessarily mean that the index goes up. The latest figures from the BPFI show that new build purchases have made up the highest %s of mortgage drawdowns since 2010 (think it was near 40%).

New build price inflation has outpaced second hand (as per the CSO) this year due to a range of factors (help to buy changes, building standard changes, Covid costs etc) so when the CSO apply their standardisations, the index may not increase.

Median is strong though so an increase looks likely

I know what you mean, CSO index is not a Median price indicator. But due to major Median price increase since beginning of Q4 2020, I highly believe this will reflect on CSO index.

The share of new build sales, is around 17%-20% of total sales, for the last few years, there are no major change this year.

Browney7

Marius34 wrote: »

I know what you mean, CSO index is not a Median price indicator. But due to major Median price increase since beginning of Q4 2020, I highly believe this will reflect on CSO index.

The share of new build sales, is around 17%-20% of total sales, for the last few years, there are no major change this year.

https://www.bpfi.ie/publications/bpfi-mortgage-drawdowns/ as I said - the BPFI are noting that new build mortgage sales are making up a very large portion of drawdowns in the latest quarter so could partially explain the observed jump in the median

Villa05

cisk wrote:

“ New figures released as part of a parliamentary question asked by Cian O’Callaghan, the Social Democrats TD, has shown that Dún Laoghaire-Rathdown County Council spent more than €2,300 a month per unit to lease social homes from private owners.

The Irish Times article last week had DLR self build units by the council priced at 205,000
8 years payback on building there own units based on rents quoted.

JimmyVik

PropQueries wrote: »

In the same paper, Greystar in apparently putting in a €180 million bid for the 385 units Cairn Homes is building at Griffith Avenue in Marino.

In relation to the Stillorgan purchase, it looks like their buying the 25 remaining apartments that Ires Reit don't own in that development.

Looks like both Greystar and Ires Reit are gearing themselves up to take some or more of that long-term lease agreement money the councils have been splashing around lately.

Link to the Greystar bid for the Griffith Avenue units in the Irish Times is here: https://www.irishtimes.com/business/commercial-property/greystar-in-180m-bid-for-griffith-avenue-apartment-portfolio-1.4418085

I know of one apartment complex in swords where a REIT have contacted all owners and offered to buy them all. Once they get a whole block or near enough they go ahead with the purchase. One block already has been closed as it was all landlords who owned the properties in that block and they wanted out. They got a 10% premium on the prices.

Ive a friend with one apartment in that block thats already sold and an apartment in another block where the negotiations are ongoing.
I assume this will be going on in other places.
Huge profit in rentals when you dont have to pay tax.

Marius34

Browney7 wrote: »

https://www.bpfi.ie/publications/bpfi-mortgage-drawdowns/ as I said - the BPFI are noting that new build mortgage sales are making up a very large portion of drawdowns in the latest quarter so could partially explain the observed jump in the median

ok that's right, but in this case median price increase is not due to the new build larger portion. Price increase seen similarly for both, new builds and second hand homes.
As well the BPFI report is from 2020 Q3, as you can see median price did not increase in Q3.