Irish Property Market 2020 Part 3

Graham

Continued from here:

https://www.boards.ie/vbulletin/showthread.php?t=2058095305

Looking back over 2020 it has certainly been an unusual year for the Irish property market with Coronavirus putting almost the entire property market on hold during the two Nationwide lockdowns. So far the impact on property prices appears to have been fairly minimal. Some areas seeing single digit price drops, others appearing to remain fairly static compared to 2019.

Delivery of new homes has certainly been impacted with neither government or private developers expecting to complete their anticipated build numbers this year.

Rent rates too have seen some impact, particularly in areas usually popular with the staff of multinationals and short term lettings. There's an ongoing discussion of Dublin rents here.

The Wage Subsidy Scheme and other government wage supports have caused some delays for people waiting to draw down a mortgage. While others continue to save for a mortgage/new home, many while working from home.

For anyone currently buying/selling a house, we have a dedicated thread here. Free from the market speculation chatter.

What will the last few weeks bring? More of the same?

ebayissues

From what I've seen so far, I'd expect +/-5% increase or decrease.

We've seen a resilient Irish economy, those buying are in stable economy, tech, finance, IT. Lack of supply in desired areas.

Commercial sector seems to have taken a hit. Being privy to some accounts and Valuations of property groups some reits aswell, they won't be released till Q1 next year. We'll some.

PropQueries

In an interview with the head of State Street in Ireland (they employ 2,000 people in Ireland) in the Irish Independent today, he says that they will "see fewer people working in its IFSC offices as is reconfigures its office footprint."

He says that "while financial services typically have 70% of employees working in Dublin and 30% in the regions, State Street would flip that around so that 65% would work from home or the regions."

He also said that "If you add up the square footage that we were leasing in January of 2020 versus what we'll be leasing in the middle of 2021, it will have fallen and we are not reducing the number of people we're employing."

Link to article in Irish Independent here: https://www.independent.ie/business/irish/state-street-reduces-office-footprint-39825777.html

So it looks like the impact of covid on the commercial office space sector and the follow on impact on the retail property space e..g. continually falling footfall etc., will continue and most likely accelerate well into 2021 and beyond.

Cyrus

PropQueries wrote: »

In an interview with the head of State Street in Ireland (they employ 2,000 people in Ireland) in the Irish Independent today, he says that they will "see fewer people working in its IFSC offices as is reconfigures its office footprint."

He says that "while financial services typically have 70% of employees working in Dublin and 30% in the regions, State Street would flip that around so that 65% would work from home or the regions."

He also said that "If you add up the square footage that we were leasing in January of 2020 versus what we'll be leasing in the middle of 2021, it will have fallen and we are not reducing the number of people we're employing."

Link to article in Irish Independent here: https://www.independent.ie/business/irish/state-street-reduces-office-footprint-39825777.html

So it looks like the impact of covid on the commercial office space sector and the follow on impact on the retail property space e..g. continually falling footfall etc., will continue and most likely accelerate well into 2021 and beyond.

He doesn’t say by how much their square footage will decrease and state street have been moving into the regions for a number of years , they have offices in Wexford Kilkenny and drogheda already for example.

It’s like every piece of news re commercial office space that has been in the works for years is news to you have you just started reading commercial property articles in the past 3 months .

TheSheriff

PropQueries wrote: »

In an interview with the head of State Street in Ireland (they employ 2,000 people in Ireland) in the Irish Independent today, he says that they will "see fewer people working in its IFSC offices as is reconfigures its office footprint."

He says that "while financial services typically have 70% of employees working in Dublin and 30% in the regions, State Street would flip that around so that 65% would work from home or the regions."

He also said that "If you add up the square footage that we were leasing in January of 2020 versus what we'll be leasing in the middle of 2021, it will have fallen and we are not reducing the number of people we're employing."

Link to article in Irish Independent here: https://www.independent.ie/business/irish/state-street-reduces-office-footprint-39825777.html

So it looks like the impact of covid on the commercial office space sector and the follow on impact on the retail property space e..g. continually falling footfall etc., will continue and most likely accelerate well into 2021 and beyond.

I would expect this to be pretty bullish for property prices for the 'regions' then....

PropQueries

Cyrus wrote: »

He doesn’t say by how much their square footage will decrease and state street have been moving into the regions for a number of years , they have offices in Wexford Kilkenny and drogheda already for example.

Well, he does say 70% are currently working in Dublin and 30% in the regions. He also said they will be switching this around to 30% working in their offices in Dublin and 70% in the regions or from home.

He also says "If you add up the square footage that we were leasing in January of 2020 versus what we'll be leasing in the middle of 2021, it will have fallen".

That's a significant drop in the number of their workers based in their Dublin office space vs regions/WFH.

So, as he does say it directly, they will have much less workers in their offices in Dublin. This means less office space required in Dublin (he also says this directly), so this means less footfall in Dublin City, which means less retail, restaurant, pub etc. staff required.

This then should translate directly into less demand for accommodation from office, retail, restaurant, pub workers etc. in Dublin City, which should directly translate into less demand for accommodation from these workers in Dublin City which translates into lower rents and prices for homes to either rent or buy in Dublin City. Well, under normal economic theory anyway.

But, I will give you that normal economic theory of the impact of changes in supply/demand on property prices doesn't always follow through in Ireland. Not in the very short term anyway. Longer term, economic theory on the impact on prices from a change in supply/demand normally does occur eventually as was evident from the aftermath of the last bust.

Graham

TheSheriff wrote: »

I would expect this to be pretty bullish for property prices for the 'regions' then....

We might see some rebalancing of supply/demand between Dublin and the regions over the coming months/years.

I personally don't think that would be a bad thing.

PropQueries

TheSheriff wrote: »

I would expect this to be pretty bullish for property prices for the 'regions' then....

Well, it's good news for the owners of the c. 90,000 vacant homes that the GeoDirectory back in Q2 2020 said were vacant at that time.

Graham

What's going to be really interesting is what happens after vaccines are made available to large numbers of the population.

Are we going to see a reversion back to pre-covid property usage patterns, or are some of the changes likely to remain permanent?

ongarite

If WFH does become more common then the demand for new 4 beds in greater Dublin area which is already outstripping supply will push prices up.
Working from home at the kitchen table won't cut it long term, people will be looking for properties with spare room, box rooms as studies or attic conversions.

Graham

I guess that depends on how many of the WFHers decide to decamp from Dublin.

Added:

Regardless, I expect you'd be right about increased demands for properties better configured to support WFH.

Cyrus

PropQueries wrote: »

Well, he does say 70% are currently working in Dublin and 30% in the regions. He also said they will be switching this around to 30% working in their offices in Dublin and 70% in the regions or from home.

He also says "If you add up the square footage that we were leasing in January of 2020 versus what we'll be leasing in the middle of 2021, it will have fallen".

That's a significant drop in the number of their workers based in their Dublin office space vs regions/WFH.

So, as he does say it directly, they will have much less workers in their offices in Dublin. This means less office space required in Dublin (he also says this directly), so this means less footfall in Dublin City, which means less retail, restaurant, pub etc. staff required.

This then should translate directly into less demand for accommodation from office, retail, restaurant, pub workers etc. in Dublin City, which should directly translate into less demand for accommodation from these workers in Dublin City which translates into lower rents and prices for homes to either rent or buy in Dublin City. Well, under normal economic theory anyway.

But, I will give you that normal economic theory of the impact of changes in supply/demand on property prices doesn't always follow through in Ireland. Not in the very short term anyway. Longer term, economic theory on the impact on prices from a change in supply/demand normally does occur eventually as was evident from the aftermath of the last bust.

You didn’t make reference to Dublin in your synopsis on the first post, my point was as he didn’t so how much their leased space would be decreasing I assume it will be very little they will just continue to hire regionally rather than in Dublin which makes sense for them as salaries will be lower in Wexford for example.

PropQueries

Graham wrote: »

I guess that depends on how many of the WFHers decide to decamp from Dublin.

Added:

Regardless, I expect you'd be right about increased demands for properties better configured to support WFH.

But many of the properties in Dublin City are houses that were converted into flats or rented by the room. If there is less demand for these flats/rooms due to less office, retail, pub, restaurant etc. workers, these will be most likely converted back into homes which should lead to a big increase in the supply of these type of properties entering the market in the short-term (if really needed).

There's one thing I would give the small mom and pop type property investor. They act very very quickly once market dynamics change.

The big boys act very very quickly too and this is evidenced by the speed all those student accommodation units went up when they weren't bogged down by the local county councils planning permission process.

Cyrus

PropQueries wrote: »

But many of the properties in Dublin City are houses that were converted into flats or rented by the room. If there is less demand for these flats/rooms due to less office, retail, pub, restaurant etc. workers, these will be most likely converted back into homes which should lead to a big increase in the supply of these type of properties entering the market in the short-term (if really needed).

There's one thing I would give the small mom and pop type property investor. They act very very quickly once market dynamics change.

The big boys act very very quickly too and this is evidenced by the speed all those student accommodation units went up when they weren't bogged down by the local county councils planning permission process.

The kind of houses that were converted into flats tend to be large red bricks that when reconverted sell for prices in the 7 figures I don’t think that’s going to move the needle.

PropQueries

Cyrus wrote: »

The kind of houses that were converted into flats tend to be large red bricks that when reconverted sell for prices in the 7 figures I don’t think that’s going to move the needle.

They only sell for 7 figures due to many of them currently in use as flats. If many are converted back into actual full family homes, the supply/demand dynamics kick in which should (admittedly in economic theory) bring them back into line with what families can afford to buy/rent them at i.e. drops of c. 50% plus?

awec

PropQueries wrote: »

They only sell for 7 figures due to many of them currently in use as flats. If many are converted back into actual full family homes, the supply/demand dynamics kick in which should (admittedly in economic theory) bring them back into line with what families can afford to buy/rent them at i.e. drops of c. 50% plus?

What on earth?

They sell for 7 figures cause they're usually huge houses in Dublin.

TheSheriff

PropQueries wrote: »

They only sell for 7 figures due to many of them currently in use as flats. If many are converted back into actual full family homes, the supply/demand dynamics kick in which should (admittedly in economic theory) bring them back into line with what families can afford to buy/rent them at i.e. drops of c. 50% plus?

But you have previously said several times there is no demand...and there is excess supply.

It's hard to keep up with your arguments when they change so frequently

PropQueries

TheSheriff wrote: »

But you have previously said several times there is no demand...and there is excess supply.

It's hard to keep up with your arguments when they change so frequently

Ok, you have your bog standard terraced red break unit in Dublin City currently in use as 6 flats at c. €1,000 each a month so that's rental income of c. €72,000 per annum.

If the demand for flats dries up due to WFH etc. and people require larger properties as as been suggested here. So, the investor converts it back into a family home. Even a well to do family would balk at paying more than €35,000 per year in rent so that's a rental price drop of at least 50%.

Hubertj

I think 2021 will continue to see people make outrageous and baseless claims about the property market, none of which will materialise.

JJJackal

PropQueries wrote: »

Well, he does say 70% are currently working in Dublin and 30% in the regions. He also said they will be switching this around to 30% working in their offices in Dublin and 70% in the regions or from home.

He also says "If you add up the square footage that we were leasing in January of 2020 versus what we'll be leasing in the middle of 2021, it will have fallen".

That's a significant drop in the number of their workers based in their Dublin office space vs regions/WFH.

So, as he does say it directly, they will have much less workers in their offices in Dublin. This means less office space required in Dublin (he also says this directly), so this means less footfall in Dublin City, which means less retail, restaurant, pub etc. staff required.

This then should translate directly into less demand for accommodation from office, retail, restaurant, pub workers etc. in Dublin City, which should directly translate into less demand for accommodation from these workers in Dublin City which translates into lower rents and prices for homes to either rent or buy in Dublin City. Well, under normal economic theory anyway.

But, I will give you that normal economic theory of the impact of changes in supply/demand on property prices doesn't always follow through in Ireland. Not in the very short term anyway. Longer term, economic theory on the impact on prices from a change in supply/demand normally does occur eventually as was evident from the aftermath of the last bust.

Why would it translate into less demand? It could translate into greater demand for bigger units. Your assumption is based on the flawed assumption that people dont want to live in Dublin - alot did pre COVID and will once again when there is a suite of activities to do in the evening and weekends which is not available in the regions.

It is also possible that cheaper rents (for offices) will attract more companies from abroad who will employ more people - creating more demand for accommodation.

So it is just as likely that demand will increase as opposed to decrease. Plus there will be bullish potential homeowners with larger deposits saved post COVID eager to buy now

JJJackal

PropQueries wrote: »

Ok, you have your bog standard terraced red break unit in Dublin City currently in use as 6 flats at c. €1,000 each a month so that's rental income of c. €72,000 per annum.

If the demand for flats dries up due to WFH etc. and people require larger properties as as been suggested here. So, the investor converts it back into a family home. Even a well to do family would balk at paying more than €35,000 per year in rent so that's a rental price drop of at least 50%.

Can you give an example of a bog standard terraced red brick house divided into six flats?

Any red brick house divided into 6 flats I have seen or heard of is typically an old Georgian house (which I would not consider bog standard...). If you converted that back into a nice house the rents are often 4 to 5 thousand a month (quick daft search there up to 10,000 a month). Most well to do families who can afford 35,000 in rent a year are probably buying a house...

Cyrus

awec wrote: »

What on earth?

They sell for 7 figures cause they're usually huge houses in Dublin.

Exactly !

PropQueries

Cyrus wrote: »

Exactly !

So, in 2019, a red brick terraced unit in Dublin that has been converted into 6 flats renting at €1,000 a month each or €72,000 a year is put up for sale. A property investor looks at that property and values it at €1,200,000 based on a 6% yield.

Fast forward to 2022/2023 and the demand for these flats has dried up due to WFH etc. with people seeking larger properties (as suggested here) and the same unit is put up for sale.

The demand is now for family homes with space and they will most likely balk at paying more than €35,000 per year in rent. To the investor seeking a 6% yield, he won't pay more than €600,000 and probably much less if he must spend money on converting it back into a family home.

The price of those type of properties falls by more then 50%.

Graham

PropQueries wrote: »

Fast forward to 2022/2023 and the demand for these flats has dried up due to WFH etc. with people seeking larger properties (as suggested here) and the same unit is put up for sale.

I don't think anyone suggested everyone was going to be moving to a 4-bed with a self contained study.

Nobody suggested demand for apartments/flats was going to vanish.

JJJackal

PropQueries wrote: »

So, in 2019, a red brick terraced unit in Dublin that has been converted into 6 flats renting at €1,000 a month each or €72,000 a year is put up for sale. A property investor looks at that property and values it at €1,200,000 based on a 6% yield.

Fast forward to 2022/2023 and the demand for these flats has dried up due to WFH etc. with people seeking larger properties (as suggested here) and the same unit is put up for sale.

The demand is now for family homes with space and they will most likely balk at paying more than €35,000 per year in rent. To the investor seeking a 6% yield, he won't pay more than €600,000 and probably much less if he must spend money on converting it back into a family home.

The price of those type of properties falls by more then 50%.

You still havent given an example of this red brick terraced unit...

I do not believe such a unit converted to a family home would be worth 50% less - even if there is recession similar to 2008/2009

Cyrus

PropQueries wrote: »

So, in 2019, a red brick terraced unit in Dublin that has been converted into 6 flats renting at €1,000 a month each or €72,000 a year is put up for sale. A property investor looks at that property and values it at €1,200,000 based on a 6% yield.

Fast forward to 2022/2023 and the demand for these flats has dried up due to WFH etc. with people seeking larger properties (as suggested here) and the same unit is put up for sale.

The demand is now for family homes with space and they will most likely balk at paying more than €35,000 per year in rent. To the investor seeking a 6% yield, he won't pay more than €600,000 and probably much less if he must spend money on converting it back into a family home.

The price of those type of properties falls by more then 50%.

In your head whereas in the real world people pay 1m
Plus for these houses spend 500-750k renovating them and if selling market them at 2.5m +

Villa05

JJJackal wrote:

Why would it translate into less demand? It could translate into greater demand for bigger units. Your assumption is based on the flawed assumption that people dont want to live in Dublin - alot did pre COVID and will once again when there is a suite of activities to do in the evening and weekends which is not available in the regions.

I think I read on this thread before that circa 50% of the people working in Dublin, live outside Dublin and commute in. I'm sure there are people that don't want to live in Dublin, but I'd imagine the majority are simply priced out of the market.
WFH makes the decision to move outside Dublin to live easier, plus it widens the potential locations to move to

JJJackal

Villa05 wrote: »

I think I read on this thread before that circa 50% of the people working in Dublin, live outside Dublin and commute in. I'm sure there are people that don't want to live in Dublin, but I'd imagine the majority are simply priced out of the market.
WFH makes the decision to move outside Dublin to live easier, plus it widens the potential locations to move to

Of course, but it still wont remove demand from single people in 20s 30s or young couples who want action and activities

Smouse156

PropQueries wrote: »

Ok, you have your bog standard terraced red break unit in Dublin City currently in use as 6 flats at c. €1,000 each a month so that's rental income of c. €72,000 per annum.

If the demand for flats dries up due to WFH etc. and people require larger properties as as been suggested here. So, the investor converts it back into a family home. Even a well to do family would balk at paying more than €35,000 per year in rent so that's a rental price drop of at least 50%.

Given that these choppers are often dilapidated I think an investor would want more than 6% gross yield on these.

While it is true to say that if demand evaporated their price would fall as the premium home market (950k plus) has struggled since 2017 and fell 4.1% in the last year, expecting a 50% discount is extremely optimistic.

There will always be some demand as people search for cheaper accommodation.

Marius34

PropQueries wrote: »

So, in 2019, a red brick terraced unit in Dublin that has been converted into 6 flats renting at €1,000 a month each or €72,000 a year is put up for sale. A property investor looks at that property and values it at €1,200,000 based on a 6% yield.

Fast forward to 2022/2023 and the demand for these flats has dried up due to WFH etc. with people seeking larger properties (as suggested here) and the same unit is put up for sale.

The demand is now for family homes with space and they will most likely balk at paying more than €35,000 per year in rent. To the investor seeking a 6% yield, he won't pay more than €600,000 and probably much less if he must spend money on converting it back into a family home.

The price of those type of properties falls by more then 50%.

So let say we have 10.000 red brick converted flats, housing average 8 people. 80K in total. You convert to family home now housing average 4 people. 40K in total. Now you have 40k people more looking for roof over their head.

Graham

I don't see a sudden rush to convert 10,000 red bricks back to single houses.

Marius34

Graham wrote: »

I don't see a sudden rush to convert 10,000 red bricks back to single houses.

It won't happen. We discussing Property fiction.

PropQueries

Marius34 wrote: »

So let say we have 10.000 red brick converted flats, housing average 8 people. 80K in total. You convert to family home now housing average 4 people. 40K in total. Now you have 40k people more looking for roof over their head.

Not really. As the head of State Street in Ireland, who employ 2,000 in Ireland, stated today, they currently have 70% working in Dublin and 30% working in the regions.

He said they will now switch it to 30% working in the office in Dublin and 70% working in the regions or WFH.

Less people working in the city means less demand for flats etc. from younger workers over the next few years.

Graham

One company that was already devolving operations if I understand correctly.

You're taking one news item and extrapolating out to the entire market.

Marius34

PropQueries wrote: »

Not really. As the head of State Street in Ireland, who employ 2,000 in Ireland, stated today, they currently have 70% working in Dublin and 30% working in the regions.

He said they will now switch it to 30% working in the office in Dublin and 70% working in the regions or WFH.

Less people working in the city means less demand for flats etc. from younger workers over the next few years.

And where do you house now those additional 40K young workers without roof?
They are not a country people, so no, they won't go to country side to move to an old abandoned houses and spend a fortune to restore it.

Graham

My guess:

there will be SOME people that WFH full time
there will be SOME people that WFH part time
there will be SOME people move out of Dublin because they can WFH
there will be SOME people looking for larger houses to support WFH
there will be plenty of people who go back to exactly the same work pattern they had pre-covid.

I expect the SOME in all of these examples to be fairly small, single digit percentage or less.

PropQueries

Marius34 wrote: »

And where do you house now those additional 40K young workers without roof?
They are not a country people, so no, they won't go to country side to move to an old abandoned houses and spend a fortune to restore it.

As someone mentioned here before, for every multinational employee, three jobs are created outside that company e.g. retail, pub, restaurant staff etc.

For every one worker from one of these companies that relocates outside the city centre, three jobs go in the companies that provide services to these employees if what that person suggests is true i.e. the jobs created on the way up will disappear on the way down. At the very least, these type of businesses won’t require any additional staff for the foreseeable future.

If these jobs disappear or aren’t growing, there won’t be much net inward migration into the city going forward. The population of Dublin City will most likely now start falling going forward.

Graham

PropQueries wrote: »

As someone mentioned here before, for every multinational employee, three jobs are created outside that company e.g. retail, pub, restaurant staff etc.

There's no expectation that a significant number of multinational employees are about to move to Leitrim.

Huge numbers of employees are Dubs or foreigners. Moving to Mayo isn't going to even enter their though process.

PropQueries

Graham wrote: »

There's no expectation that a significant number of multinational employees are about to move to Leitrim.

Huge numbers of employees are Dubs or foreigners. Moving to Mayo isn't going to even enter their though process.

Well the Dublin City property market is highly dependent on the influx of rural people and foreign nationals entering the city every year to take up jobs.

Once that stops where does the housing demand come from?

Graham

It's not going to stop.

It may slow a little.

Hubertj

State street could be flag flying in order to negotiate better terms with landlord. Look at what zuckerberg said during summer about wfh while at same time Facebook was negotiating for massive office blocks in Manhattan. Smart move

PropQueries

A company in Kerry is building houses for its staff in order to provide security for their staff as well as to attract and retain workers.

They state “The houses in small blocks are A-rated, with air-to-water heating, and come in at the not-for-profit price of €150,000”.

“The houses are fully owned by our employees. Employees have to work with the company for 10 years and after that they are free to sell without any penalty.”

Link to article in the Irish Times here: https://www.irishtimes.com/news/ireland/irish-news/kerry-employer-builds-homes-to-help-and-retain-staff-1.4429175

It’s kind of sad that we have now got to this situation where companies have to build houses for their staff so they don’t risk losing them IMO

Pelezico

The economy will slow next year as taxes increase. This may impact property prices.

That said, the number of houses on market is falling dramatically. People seem reluctant to sell.

Marius34

PropQueries wrote: »

As someone mentioned here before, for every multinational employee, three jobs are created outside that company e.g. retail, pub, restaurant staff etc.

For every one worker from one of these companies that relocates outside the city centre, three jobs go in the companies that provide services to these employees if what that person suggests is true i.e. the jobs created on the way up will disappear on the way down. At the very least, these type of businesses won’t require any additional staff for the foreseeable future.

If these jobs disappear or aren’t growing, there won’t be much net inward migration into the city going forward. The population of Dublin City will most likely now start falling going forward.

Just because there is less needs to be in Dublin for work, it doesn't mean that those additional 40K people without roof, don't need place to live? It will require more housing.

Cyrus

PropQueries wrote: »

A company in Kerry is building houses for its staff in order to provide security for their staff as well as to attract and retain workers.

They state “The houses in small blocks are A-rated, with air-to-water heating, and come in at the not-for-profit price of €150,000”.

“The houses are fully owned by our employees. Employees have to work with the company for 10 years and after that they are free to sell without any penalty.”

Link to article in the Irish Times here: https://www.irishtimes.com/news/ireland/irish-news/kerry-employer-builds-homes-to-help-and-retain-staff-1.4429175

It’s kind of sad that we have now got to this situation where companies have to build houses for their staff so they don’t risk losing them IMO

It’s not a new concept why do you find it sad ? I’d imagine the staff are pretty happy about it and the company will have costed this, it ensures they can limit their payroll increases that’s for sure !

TheSheriff

Cyrus wrote: »

It’s not a new concept why do you find it sad ? I’d imagine the staff are pretty happy about it and the company will have costed this, it ensures they can limit their payroll increases that’s for sure !

It's a win win for employee and company; you are likely to stay for the ten years and at that point you'll be less likely to leave the company anyway, all at the cost of 15k/year to the company over the assets lifetime (assume upkeep is the responsibility of the employee).

Cyrus

TheSheriff wrote: »

It's a win win for employee and company; you are likely to stay for the ten years and at that point you'll be less likely to leave the company anyway, all at the cost of 15k/year to the company over the assets lifetime (assume upkeep is the responsibility of the employee).

I’m pretty sure the employees pay a mortgage on it otherwise there would be bik issues (and they note the mortgage is less than rent ) so win win for the company.

mcsean2163

PropQueries wrote: »

So, in 2019, a red brick terraced unit in Dublin that has been converted into 6 flats renting at €1,000 a month each or €72,000 a year is put up for sale. A property investor looks at that property and values it at €1,200,000 based on a 6% yield.

Fast forward to 2022/2023 and the demand for these flats has dried up due to WFH etc. with people seeking larger properties (as suggested here) and the same unit is put up for sale.

The demand is now for family homes with space and they will most likely balk at paying more than €35,000 per year in rent. To the investor seeking a 6% yield, he won't pay more than €600,000 and probably much less if he must spend money on converting it back into a family home.

The price of those type of properties falls by more then 50%.

I lived in something like that in rathgar. Doubt there are many left of that type....

Villa05

Cyrus wrote: »

It’s not a new concept why do you find it sad ? I’d imagine the staff are pretty happy about it and the company will have costed this, it ensures they can limit their payroll increases that’s for sure !

Significant lessons there for a country with a debt mountain and a pensions crisis.

Villa05

PropQueries wrote: »

A company in Kerry is building houses for its staff in order to provide security for their staff as well as to attract and retain workers.

They state “The houses in small blocks are A-rated, with air-to-water heating, and come in at the not-for-profit price of €150,000”.

“The houses are fully owned by our employees. Employees have to work with the company for 10 years and after that they are free to sell without any penalty.”

Link to article in the Irish Times here: https://www.irishtimes.com/news/ireland/irish-news/kerry-employer-builds-homes-to-help-and-retain-staff-1.4429175

It’s kind of sad that we have now got to this situation where companies have to build houses for their staff so they don’t risk losing them IMO

Any idea how it works, Do the employees get there own independent mortgage to purchase? Is the land cost recouped from the employee over the 10 years

Villa05

WFH Case Studies, Supports, Reports


We’re hearing from the people who fled to rural Ireland during the lockdown, and asking if they’ll ever bother to return to city living.