Vacant Properties in Ireland

Timing belt

schmittel wrote: »

How does a few photos of houses mean I have just found out that 3-4% of the entire housing stock is misclassified?

From the photos they look as they should be classified as habitable and rightly so.

If they should not be classified as habitable what should they be classified as instead?

I think the point is that it is not about classification it’s that cost to make them viable is causing them to be vacant. Similar to the reason why new stock is not being build

hometruths

Timing belt wrote: »

I think the point is that it is not about classification it’s that cost to make them viable is causing them to be vacant. Similar to the reason why new stock is not being build

Yes but that does not mean they don’t exist - they are a dwelling which represents part of the total housing stock.

It’s not the job of the census to decide whether renovating a property is financially viable or not.

PropQueries

schmittel wrote: »

Yes but that does not mean they don’t exist - they are a dwelling which represents part of the total housing stock.

It’s not the job of the census to decide whether renovating a property is financially viable or not.

Of course they're financially viable to refurbish. I believe it comes back to my original belief that they're primarily owned by the investment funds who purchased that €200 billion in property and business loans between 2012 and 2016.

It will take a while for them to get around to refurbishing most of the properties they purchased and many will start to re-enter the market very shortly. Once they issue a large contract (they probably already have) to refurbish them, the cost would be a fraction of how much we would have to pay. Bulk discount and all.

cnocbui

schmittel wrote: »

How does a few photos of houses mean I have just found out that 3-4% of the entire housing stock is misclassified?

From the photos they look as they should be classified as habitable and rightly so.

If they should not be classified as habitable what should they be classified as instead?

Because if you extrapolate from 5 wrongly classified properties all within 250m of each other in one small village, to the likelihood of the same existing all over the country, the numbers become large and significant.

They should be classed as unfinished and uninhabitable, not as part of the available housing stock.

They are also unavailable in the financial sense of owners not willing to put them to market at below cost. If the government wants a quick easy partial fix of availability - allow owners of such properties to negative-gear, where they could offset a capital loss against income in general, not just capital gain, if they sell to a first time buyer or council.

cnocbui

PropQueries wrote: »

What site are you getting them from?

I took the photos.

hometruths

cnocbui wrote: »

Because if you extrapolate from 5 wrongly classified properties all within 250m of each other in one small village, to the likelihood of the same existing all over the country, the numbers become large and significant.

They should be classed as unfinished and uninhabitable, not as part of the available housing stock.

Completely disagree but no point arguing about it.

They are also unavailable in the financial sense of owners not willing to put them to market at below cost. If the government wants a quick easy partial fix of availability - allow owners of such properties to negative-gear, where they could offset a capital loss against income in general, not just capital gain, if they sell to a first time buyer or council.

Completely agree, that’s my whole point.

PropQueries

cnocbui wrote: »

Because if you extrapolate from 5 wrongly classified properties all within 250m of each other in one small village, to the likelihood of the same existing all over the country, the numbers become large and significant.

They should be classed as unfinished and uninhabitable, not as part of the available housing stock.

They are also unavailable in the financial sense of owners not willing to put them to market at below cost. If the government wants a quick easy partial fix of availability - allow owners of such properties to negative-gear, where they could offset a capital loss against income in general, not just capital gain, if they sell to a first time buyer or council.

Well, they're obviously most likely owned by an investment fund. If the original developer still owed them, he would have forked out for the paint and a bit of heating each year to ensure they wouldn't lose value.

Timing belt

PropQueries wrote: »

Well, they're obviously most likely owned by an investment fund. If the original developer still owed them, he would have forked out for the paint and a bit of heating each year to ensure they wouldn't lose value.

Not necessarily

cnocbui

PropQueries wrote: »

Well, they're obviously most likely owned by an investment fund. If the original developer still owed them, he would have forked out for the paint and a bit of heating each year to ensure they wouldn't lose value.

One I suspect is owned by a local farmer and the lot of 4 townhouses are currently for sale as a lot and I believe NAMA are the owners.

hometruths

cnocbui wrote: »

One I suspect is owned by a local farmer and the lot of 4 townhouses are currently for sale as a lot and I believe NAMA are the owners.

Do the townhouses have any planning restrictions eg holiday homes?

PropQueries

cnocbui wrote: »

One I suspect is owned by a local farmer and the lot of 4 townhouses are currently for sale as a lot and I believe NAMA are the owners.

But why would the farmer spend c. €150k - €200k building the house and then not spend c. €500 per year (€5000 in total over the past ten years) not turning on the heating for an hour a day and buying a can of paint to keep them in reasonable shape for a potential re-sale in the future?

Edit: €200 per year or €2,000 in total over the past 10 years. Heating doesn't cost that much for an hour or two a day.

Such properties are very likely part of the €200 billion in property and business loans purchased by the investment funds between 2012 and 2016. As you already stated, the rest are most likely owned by NAMA.

cnocbui

schmittel wrote: »

Do the townhouses have any planning restrictions eg holiday homes?

I wouldn't know. There is a Hickey O’Donoghue sign out the front, so you could ask them, but I am not even sure they are still agents as I can't find them on their site.

cnocbui

PropQueries wrote: »

But why would the farmer spend c. €150k - €200k building the house and then not spend c. €500 per year (€5000 in total over the past ten years) not turning on the heating for an hour a day and buying a can of paint to keep them in reasonable shape for a potential re-sale in the future?

Edit: €200 per year or €2,000 in total over the past 10 years. Heating doesn't cost that much for an hour or two a day.

I don't think you would build that house for that sort of money. The house is painted white. I don't know how you are able to determine whether the house has the heating come on, or not.

PropQueries

cnocbui wrote: »

I don't think you would build that house for that sort of money. The house is painted white. I don't know how you are able to determine whether the house has the heating come on, or not.

That would make the €500 investment per annum even more of an incentive.

But it also means it's habitable which kind of goes against your initial argument and purpose for posting the photos?

cnocbui

PropQueries wrote: »

That would make the €500 investment per annum even more of an incentive.

But it also means it's habitable which kind of goes against your initial argument and purpose for posting the photos?

By your criteria, an empty freight container is habitable. I am failing utterly to understand your fixation on the idea of maintenance heating being an investment that somehow automatically makes a structure habitable.

My 'holiday home' doesn't even have heating to turn on, yet it would qualify as habitable.

hometruths

I think everyone agrees we had pretty massive oversupply in 2011 thanks to the hangover, and everyone seems to agree we had crisis undersupply by late 2016.

It is interesting to compare the vacancy rates (ex holiday homes) from 2011 with December 2016:

Census 2011 - national vacancy rate was 11.88%
GeoDirectory Data - Q4 2016 - national vacancy rate was 10.11%

in the interests of comparing apples with apples, vacancy rate is calculated as (Total Vacancies less Holiday Homes)/(Total Stock less Holiday Homes)

It seems odd that if we were in situation of massive oversupply with vacancy rate of 11.88% and crisis undersupply with a vacancy rate of 10.11%

PropQueries

cnocbui wrote: »

By your criteria, an empty freight container is habitable. I am failing utterly to understand your fixation on the idea of maintenance heating being an investment that somehow automatically makes a structure habitable.

My 'holiday home' doesn't even have heating to turn on, yet it would qualify as habitable.

You quite clearly posted those photos to show that the vacant homes as recorded by the census enumerators were not accurate and that they recorded properties that appeared habitable but were not. Now you're saying the example you posted is most likely indeed habitable. But, moving on...

cnocbui

PropQueries wrote: »

You quite clearly posted those photos to show that the vacant homes as recorded by the census enumerators were not accurate and that they recorded properties that appeared habitable but were not. Now you're saying the example you posted is most likely indeed habitable. But, moving on...

I posted those photos to show that the figures for empty and available housing stock are likely a nonsense and are significantly exagerated. No I didn't. Your reading comprehension is poor.

PropQueries

cnocbui wrote: »

No I didn't. Your reading comprehension is poor.

Ok, as they say, I'll bite. So, what exactly was the point of posting a random photo of a random house on a property thread discussing vacant properties with the tagline "Who do you think owns this? Is it habitable? What is it's current status"?

hometruths

cnocbui wrote: »

I posted those photos to show that the figures for empty and available housing stock are likely a nonsense and are significantly exagerated. No I didn't. Your reading comprehension is poor.

If you think the the townhouses should be classified as unfinished, should that be a completely new classification or should they be added to under construction. I guess by definition all properties under construction are unfinished.

PropQueries

schmittel wrote: »

I think everyone agrees we had pretty massive oversupply in 2011 thanks to the hangover, and everyone seems to agree we had crisis undersupply by late 2016.

It is interesting to compare the vacancy rates (ex holiday homes) from 2011 with December 2016:

Census 2011 - national vacancy rate was 11.88%
GeoDirectory Data - Q4 2016 - national vacancy rate was 10.11%

in the interests of comparing apples with apples, vacancy rate is calculated as (Total Vacancies less Holiday Homes)/(Total Stock less Holiday Homes)

It seems odd that if we were in situation of massive oversupply with vacancy rate of 11.88% and crisis undersupply with a vacancy rate of 10.11%

Could it be that the Government badly needed the investment funds to buy all that property from the banks and they had to set out the narrative that there was a housing supply problem to get them to buy? But, then again, would the investment funds fall for such a narrative? But they did buy them for a fraction of the build costs so maybe they thought it was worth the risk.

hometruths

PropQueries wrote: »

Could it be that the Government badly needed the investment funds to buy all that property from the banks and they had to set out the narrative that there was a housing supply problem to get them to buy? But, then again, would the investment funds fall for such a narrative? But they did buy them for a fraction of the build costs so maybe they thought it was worth the risk.

I doubt it, but then again I am not convinced the investment funds own all the vacant properties!

PropQueries

schmittel wrote: »

I doubt it, but then again I am not convinced the investment funds own all the vacant properties!

Not all. Even 50% of the uncategorised properties would amount to c. 60,000 properties or three years worth of current annual new build supply.

Timing belt

schmittel wrote: »

I think everyone agrees we had pretty massive oversupply in 2011 thanks to the hangover, and everyone seems to agree we had crisis undersupply by late 2016.

It is interesting to compare the vacancy rates (ex holiday homes) from 2011 with December 2016:

Census 2011 - national vacancy rate was 11.88%
GeoDirectory Data - Q4 2016 - national vacancy rate was 10.11%

in the interests of comparing apples with apples, vacancy rate is calculated as (Total Vacancies less Holiday Homes)/(Total Stock less Holiday Homes)

It seems odd that if we were in situation of massive oversupply with vacancy rate of 11.88% and crisis undersupply with a vacancy rate of 10.11%

As I said before the crisis is about affordable housing so if vacancy is not in this sector it has very little bearing on the housing crisis. The crisis is because the cost of building (or bring a vacant house) to market is not financially rewarding enough which creates the shortage.

The reason that it is not financially rewarding enough is due to the salary cap on mortgages because this means that property prices do not increase out of line with wage growth. what we end up with is people that can't buy because house are to expensive and builders can't build because prices are to low. So instead you have the cash buyers and the funds industry entering the market and keeping prices propped up.

PropQueries

Timing belt wrote: »

As I said before the crisis is about affordable housing so if vacancy is not in this sector it has very little bearing on the housing crisis. The crisis is because the cost of building (or bring a vacant house) to market is not financially rewarding enough which creates the shortage.

The reason that it is not financially rewarding enough is due to the salary cap on mortgages because this means that property prices do not increase out of line with wage growth. what we end up with is people that can't buy because house are to expensive and builders can't build because prices are to low. So instead you have the cash buyers and the funds industry entering the market and keeping prices propped up.

But until we ret rid of this vacant homes overhang, it will then never be profitable to build new homes outside of Dublin. Only solution appears to be for the government to either knock them down or provide a 'stick' to incentivise the funds etc. to offload them quickly. Given that the funds won't pay to knock them down, the only alternative is the 'stick' as any 'carrots' would only cost the state with no sure outcome.

Otherwise, we will be dealing with this overhang for generations to come.

cnocbui

PropQueries wrote: »

Ok, as they say, I'll bite. So, what exactly was the point of posting a random photo of a random house on a property thread discussing vacant properties with the tagline "Who do you think owns this? Is it habitable? What is it's current status"?

There is nothing random about the photos and they are directly relevant to the topic and a property thread. :rolleyes:

'Who do you think owns this' is a direct response to you posting:

PropQueries wrote: »

Well, they're obviously most likely owned by an investment fund. If the original developer still owed them, he would have forked out for the paint and a bit of heating each year to ensure they wouldn't lose value.

Because neither property is likely owned by an investment fund.

I shouldn't have to explain the other parts of the 'tag line'.

hometruths

Timing belt wrote: »

As I said before the crisis is about affordable housing so if vacancy is not in this sector it has very little bearing on the housing crisis. The crisis is because the cost of building (or bring a vacant house) to market is not financially rewarding enough which creates the shortage.

The reason that it is not financially rewarding enough is due to the salary cap on mortgages because this means that property prices do not increase out of line with wage growth. what we end up with is people that can't buy because house are to expensive and builders can't build because prices are to low. So instead you have the cash buyers and the funds industry entering the market and keeping prices propped up.

Whilst I agree most of the vacant properties are likely to be in the ownership of people/institutions who can well afford them, I don't understand why you think properties themselves are unlikely to be in the affordable sector.

What is your definition of affordable housing? I guess it's price, if so, at what price does house become unaffordable?

Timing belt

PropQueries wrote: »

But until we ret rid of this vacant homes overhang, it will then never be profitable to build new homes outside of Dublin. Only solution appears to be for the government to either knock them down or provide a 'stick' to incentivise the funds etc. to offload them quickly. Given that the funds won't pay to knock them down, the only alternative is the 'stick' as any 'carrots' would only cost the state with no sure outcome.

Otherwise, we will be dealing with this overhang for generations to come.

Regardless of who own's them they are having very little bearing on "affordable" housing and I doubt they are stopping builders from building new houses.

If there was no intervention by government's etc then FTB's would get the credit to buy which would push prices of all property up and would result in builders building houses again. The problem with this is that you end up with a housing bubble again so instead you end up with people not being able to get credit who in turn rent which in turn keeps the house prices from dropping to affordable levels as Cash Buyers/Funds enter the market to cash in on the rent.

Timing belt

schmittel wrote: »

Whilst I agree most of the vacant properties are likely to be in the ownership of people/institutions who can well afford them, I don't understand why you think properties themselves are unlikely to be in the affordable sector.

What is your definition of affordable housing? I guess it's price, if so, at what price does house become unaffordable?

The affordable price is dictated by the central bank rules on multiple of salary. So if you took the average industrial wage and multiplied it by the Cap you would get close to the affordable price.

PropQueries

cnocbui wrote: »

There is nothing random about the photos and they are directly relevant to the topic and a property thread. :rolleyes:

'Who do you think owns this' is a direct response to you posting:



Because neither property is likely owned by an investment fund.

I shouldn't have to explain the other parts of the 'tag line'.

Point taken