Irish Property Market chat II - *read mod note post #1 before posting*

Stark

https://www.boards.ie/discussion/comment/118468359#Comment_118468359

I grew up in Mayfield. Think there's good value to be had, especially as the area seems a lot more settled now than when I was growing up. Would be interested in seeing a link to the house out of curiosity. Like most areas, there are some estates/streets where I'd buy without hesitation and others that I'd stay clear of.

Edit: Found the link and funnily enough it's the exact street I grew up on lol. It's a nice street. I remember it going through some rough phases growing up as kids turned into teenagers but they're all grown up and moved out now and the street is nice and settled. Barring a couple of odd neighbours, most people on the street are lovely. The only thing I would be careful of is I remember a council house at the bottom of the hill that had various scummy tenants over the years. Not sure if it's the house that's for sale or an adjacent one. I haven't heard of trouble in recent years so either the council sold it on or they found nice tenants to live there. Probably worth asking about before buying though.

Marius34

https://www.boards.ie/discussion/comment/118494138#Comment_118494138

Not sure what you mean by first question. If Investment fund balance sheet located in Ireland and it has debt, it would be captured in the graph.

And yes, the graph is very highly affected by so called "Leprechaun economics".

Board.surf

https://www.boards.ie/discussion/comment/118484677#Comment_118484677

Indeedy.

Timing belt

https://www.boards.ie/discussion/comment/118494249#Comment_118494249

The graph excludes financials such as funds, banks, etc…

you are right that GDP is impacted by FDI and instead the better measure is GNI :

SmokyMo

More than 90,000 dwellings in Ireland were vacant last year

https://www.irishexaminer.com/news/arid-40787289.html

Timing belt

https://www.boards.ie/discussion/comment/118495256#Comment_118495256

more info on this in the geo directory report that was published today

https://www.geodirectory.ie/getattachment/Knowledge-Centre/Reports-Blogs/GeoDirectory-Residential-Buildings-Report-Q4-2021/GeoDirectory_Residential_Report_Issue_16_Q4_Q2021.pdf?lang=en-IE

L1011

Geodirectory figures have been challenged (and defended) on here extensively here before. Lets not repeat it.

Marius34

https://www.boards.ie/discussion/comment/118495076#Comment_118495076

I believe you are right. So that mean the largest slice of Debt comes from Private Corporate, due to to previous mentioned "Leprechaun economics"

Timing belt

https://www.boards.ie/discussion/comment/118495487#Comment_118495487

Financial intermediaries would hold the highest level of debt in Ireland but wouldn’t impact the economy if it got into difficulty as mainly owned by overseas investors.

Marius34

https://www.boards.ie/discussion/comment/118495543#Comment_118495543

I'm not sure what you consider Financial intermediaries, but from what I understand Apple Ireland would be/have been the largest debt holder in their balance sheets.

Timing belt

https://www.boards.ie/discussion/comment/118495622#Comment_118495622

Financial intermediaries will be funds banks trust companies, spv’s etc.

I’m not familiar with the Apple structure but would imagine most of the debt is issued in the US as it would be tax deductible while the cash would sit in Ireland where it would pay lower tax…. even if they did have debt in Ireland it most likely is held in a SPV.

Marius34

https://www.boards.ie/discussion/comment/118495827#Comment_118495827

I don't think it's debt would be as big as from likes of Apple.

More than that I'm abit confused on what you saying: "Financial intermediaries will be funds banks trust companies, spv’s etc."

I would have thought that in many cases those would not be considered as NFC (Non Financial Corporates). Whereas the diagram says, that the main debt is from NFC.

Timing belt

https://www.boards.ie/discussion/comment/118496020#Comment_118496020

NFC are companies other than financials and the graph doesn’t show any financial companies data…to see that you would need to look at central bank data

Marius34

https://www.boards.ie/discussion/comment/118496048#Comment_118496048

And that's what confuses me. Because you said "Financial intermediaries will be funds banks trust companies, spv’s etc". Is this considered as NFC?

Timing belt

https://www.boards.ie/discussion/comment/118496114#Comment_118496114

No that is considered FC (Financial Corporations) and will include the following:

NFC are corporations that do not fall into the above category.

Marius34

https://www.boards.ie/discussion/comment/118496204#Comment_118496204

Ok, I though that you still discussing in regards to Ireland Public and NFC debt diagrams provided by me and Wanderer and you.

When I said "So that mean the largest slice of Debt comes from Private Corporate", I was relating to the portion from diagrams, rather than total Irish external debts.

Timing belt

https://www.boards.ie/discussion/comment/118496339#Comment_118496339

FC Debt 7112bn

NFC Debt 2828bn

Government debt 287bn

household debt 139bn

Villa05

Not sure if this is a throwaway comment by Austin Hughs or if he has significant data to back ut up but interesting none the less

https://www.independent.ie/business/personal-finance/latest-news/property-prices-surge-by-14pc-in-a-year-41255766.html

Remote working has prompted huge numbers of householders to sell their homes on the east coast and move to more rural areas.

enricoh

I see in the news house prices rose by 14% in the year to November. Fairly grim for young people trying to get ahead in life. Also saw Australia are enticing people over by waiving permit fees etc.

I expect there is a fair pent up demand for people traveling, could we see a brain drain due to totally unaffordable rents n house prices going that way at a rate of knots?

yer man!

https://www.boards.ie/discussion/comment/118500186#Comment_118500186

It has already begun, I hire people in The Netherlands and the amount of very skilled irish people coming this way in the last year has exploded.

Villa05

https://www.boards.ie/discussion/comment/118500828#Comment_118500828

In your opinion are they fleeing taxes or house prices

yer man!

https://www.boards.ie/discussion/comment/118501388#Comment_118501388

Housing without a doubt, housing! House prices are fecked here too but at least renting alone is still realistic for the most part.

PommieBast

https://www.boards.ie/discussion/comment/118501388#Comment_118501388

When I talk to other people who've left Ireland they generally cite accommodation and/or lockdown. Personal taxation levels is very much a secondary concern.

Timing belt

Interesting stat from the CSO that was published today but didn't make the newspapers

Villa05

https://www.boards.ie/discussion/comment/118502591#Comment_118502591

Does this look like its topping out?

2020 was full lockdown

2021 almost everything open, yet no change of note in executable demand despite rising deposits in banks

I guess we can see why Gov were adament on introducing shared ownership contrary to all advise. New builds are beyond affordability and it wouldn't look good if it were just investment funds and gov were buying new builds.

Getting close

Timing belt

https://www.boards.ie/discussion/comment/118503680#Comment_118503680

I don't think it is topping out as the number of transactions is severely hampered by available supply. Also the banks are full of deposits which suggests that there are people who would buy if there was enough properties for sale. Add on top of that wage inflation and prices will continue to rise until the supply of properties to buy picks up.

The new builds have only increased 3.3% but I expect that figure to be higher over the coming months as it is based on execution so you will have people that have agreed a higher price in 2021 but won't have the new property delivered till 2022.

Amadan Dubh

https://www.daft.ie/for-sale/studio-apartment-25-belgrave-road-rathmines-rathmines-dublin-6/3682450

On a lighter note, here is the investment opportunity of a lifetime! €140k for a studio apartment in Rathmines. Yes it looks like it is just the front room of an old house but rest assured it cab be rented as a studio apartment for some desperate renter.

iColdFusion

https://www.boards.ie/discussion/comment/118503854#Comment_118503854

Surely its illegal to sell that as a studio apartment? Doesn't really look like its up to any sort of building or fire regs compliance and even how exactly would it be subdivided between the different owners, etc!

That said its probably already sold for cash monies 😄

L1011

Another vacancy survey that may have some significant issues determining what is a holiday house and what isn't:

https://www.irishtimes.com/news/social-affairs/almost-45-000-properties-lie-empty-in-west-northwest-and-border-area-1.4780786

Three highest areas for vacant and derelict residential properties are apparently Kilalla, Burtonport and Bunbeg-Derrybeg. All three are full of holiday homes. I know Burtonport very well.

On the commercial vacancy rate Burtonport is definitely up there - all the old fishermans coop / Marinpro buildings, Cope supermarket, post office, butchers, tailors, BIM ice plant, one of the restaurants (possibly pub licenced, can't remember), old health centre, are all empty - but there is no way 20% of the houses are actually vacant. A holiday house is not a vacant house unless you intend some method to seize them or tax them beyond plausible existence.

And considering the few recent businesses in Burtonport - the cafe and the gift shop; plus the entire re-use plan for the fishermans co-op and Marinpro sites are tourism dependent; and it hasn't had a hotel for maybe 50 years - those holiday homes, be they personally held or rented out, are about all they have as customers.

L1011

https://www.boards.ie/discussion/comment/118503854#Comment_118503854

Lack of a floor plan showing that the separate bathroom is, in fact, part of the "apartment" is setting off alarm bells for me.

Villa05

https://www.boards.ie/discussion/comment/118503807#Comment_118503807

Ref new builds. Why do you think ftb's are foregoing all the help to buy a new build over no help buy an existing dwelling?

Is it purely low supply mixed with panic to buy whatever is available driven by high rents.

If that is the case, I would be advising anyone with in demand skills to leave the country.

Your in trouble if the biggest decision of your life is panic driven

cnocbui

https://www.boards.ie/discussion/comment/118504884#Comment_118504884

I am selling my 'holiday' property located in Connemara. That region is fuc*** and it has nothing whatsoever to do with holiday homes. There will be no one living west of Oughterard, a century from now. This parochial, to the point of childish and retarded, 'local needs only' nonsense is partly to blame, and is the opposite of the cure i'ts promoted as.

That holiday home is not officialy known to exist and didn't even get an Eircode.

Timing belt

https://www.boards.ie/discussion/comment/118504979#Comment_118504979

I think it is a mix of low supply and fear that a large number of the properties in the estate/flat complex will be social housing.

I don't think there is panic buying going on I think it is just the dynamics of the market due to low supply and the fact that rent is a more expensive option.

Even if you overpaid today by 5% on a 500k property it would probably be the same as paying paying rent for a year at circa 2k a month. Add on top that people expect house prices to increase because there is wage inflation. So in the above example if prices increased by 5% in 2022 and you overpaid by 5% you would still be 25k better off buying today than waiting a year.

I don't understand why you would advise people to leave the country.... Most developed countries have similar issues to Ireland at present so to be able to buy else where might be just as difficult. If they went to Netherlands they would be less likely to be able to buy a property than in Ireland as they have had double digit growth in residential property for the past few years.... ok they may find it easier to rent but they will get older and will still not have bought a property which may become problematic as they get closer to 40.

Bass Reeves

https://www.boards.ie/discussion/comment/118504895#Comment_118504895

Its planning that will stop by hat sale not alarm bells. Unless there is planning for separate units and the conditions of that planning is met, it's unlikely that it can be sold. Hard to believe that an auctioneer would put it up unless planning was in place.

L1011

https://www.boards.ie/discussion/comment/118509346#Comment_118509346

Going to be pre63 surely.

I have no idea if it is pre63 but 1973 called and it wants that bathroom back.

Amadan Dubh

Back to the "sky is falling", an article today on The Great Resignation which Ireland will start to experience as COVID restrictions ease up.

https://www.irishtimes.com/business/economy/how-much-will-your-wage-package-increase-this-year-1.4781403

One thing that stood out was a note that;

Labour shortages are now a crucial economic issue. While some pandemic- related pressures may ease in the short term, employers’ group Ibec says that “the significant tightness in the labour market remains the greatest permanent threat to competitiveness”.

It estimates that 60,000 additional employees could be needed across the economy each year to 2025 and, adding up the numbers, sees a significant shortfall.

I don't suppose they know where these employees would live if many were coming from abroad?! It feels like the economic stress events will hit soon and I don't know how this perfect storm will manifest but I don't think it will be positive.

J_1980

https://www.boards.ie/discussion/comment/118509681#Comment_118509681

Plenty of labor available:

“Eurostat data show that in 2016 in Ireland 11.6 per cent of adults aged 18-59 lived in households where no-one was working”

why work as long as you have shills like richard boyd barrett even considering cost rentals too expensive. Free houses are needed!!!

mind boggling that these people (mick wallace too etc) even get past 5% first preference votes.

the irish middle class needs a proper living standard reset (taxes or sky high inflation) to see these left wing low IQ’ers for what they really are…

Bass Reeves

https://www.boards.ie/discussion/comment/118509587#Comment_118509587

It would matter if it was pre 63. There would have to be planning in place to indicate that there was different units within the building. Originally it was a single dwelling.

Unless it's a cash buyer nobody will get a mortgage for such a purchase. Even if you did there would have to be an OMC in place to manage the common area's so again a solicitor would advise against sign off.

Pussyhands

US stock market shaky on the back of interest rates rising. Netflix stock tanked 20% after releasing earnings which beat all the top line estimates. Peleton announced they're stopping production until March on the back of lower demand.

Pandemic coming to an end in Ireland and will soon be the same all over the world.

If I had just bought a house in the last 6 months I'd be anxious.

What's happening in the last 18 months is unsustainable. Labour shortages, housing shortages, high inflation. Looking at the charts. From September 2020 - November 2021 house prices have risen 15.4%. That is unbelievable growth at a time when prices were already hugely inflated. You can talk about supply and demand but where is all this extra money coming from? Wages aren't growing at that pace.

If a house sold in September 2020 for 350k, that same house is now sold for 404k. I imagine there's a lot of FOMO going on at the moment. Psychology plays a huge part. Things are gone mad again. Even in the Self Build group on facebook you can see it. In the last month or so I've seen questions about giving your house a name and another one asking if they should put in 2 dishwashers as when you are filling one dishwasher, the other one will have clean dishes available.

Could be time to strap in.

wassie

The boom is getting boomier!

GoldFour4

https://www.boards.ie/discussion/comment/118510487#Comment_118510487

Netflix did not beat all estimates. Their subscriber growth (key metric for a company such as them) was below its estimates. They are also projecting that new subscriber growth in Q1 is about 50% of what analysts expected.

In terms of where the money is coming from - I think there has always been a lot of potential buyers ( saying 2 people in this case) whose 3.5 times came to somewhere in the €350k-€450k range without exemptions. The supply side issues has meant that these people are now paying €420k for a house that they could have got a few years ago for €330k for example. That price range is by far the most heated from what I've seen. I'd be more concerned if I'd bought a house in the €800/900k range than €400k as I think there will always be a relatively strong market in that range.

It'll be another 3/4 years until we see any sort of change imo when the currently new developments are built and being lived in.

Also the self build market is a bit of an isolated case in reality. These houses are generally being built as peoples forever homes - normally they aren't expecting to be selling in 10 years time so are willing to go a bit over the top on the spend.

Pussyhands

https://www.boards.ie/discussion/comment/118510567#Comment_118510567

I said Netflix beat the top line estimates.

Earnings per share (EPS): $1.33 vs 82 cents expected in a Refinitiv survey of analysts.

Revenue: $7.71 billion vs $7.71 billion expected, according to Refinitiv.

Global paid net subscriber additions: 8.28 million vs 8.19 million expected, according to StreetAccount estimates

While demand can remain high, unless there's money to go with them then prices will come down.

With the pandemic everyone was stuck at home all day and many probably went all in to get a nice house because they were at home all the time. With pandemic coming to an end will all those savings be spent? Will people turn to splurging on megaholidays now instead?

All I know is, there's no such thing as a free lunch.

fliball123

https://www.boards.ie/discussion/comment/118510622#Comment_118510622

Free lunch or not there were record savings recorded in Irish bank accounts there not so long ago. Also people have to live somewhere there is no getting around that and regardless of how netflix are doing or if they increase their price, they have to compete with sky, disney, virgin etc so you can pick and choose to watch or not to watch or choose a competitor. When it comes to having a roof over you head there are not that many options that are cheap if you dont buy your paying out more in rent. There is no way prices of property will be coming down in the next 5 years. Labour shortages, material shortages and both of the prices on these are zooming up just look at the price of Timber then throw in the price of oil.. Add in we are not building enough to sustain the growth in population even if we had no deficit in housing the amount build last year would not of been enough for the new demand coming on that year. So unless there is a mass exodus of our population (may happen it has happened before) or/and the cost of building a property suddenly drops by at least 30/40% (cant see this happening either) and builders decide they dont want to make a profit and just build for the good of their health (more chance of me winning the lotto 5 times in a row) then there will be no reduction in price. I find it funny people take one head line drop in a certain non related industry and equate it to people who have bought in the last 6 months as a sign of an upcoming Armageddon. I mean we just had brexit and we still have covid you cant get any worse when it comes to putting fear into people when it comes to spending.

timmyntc

https://www.boards.ie/discussion/comment/118510487#Comment_118510487

If I had just bought a house in the last 6 months I'd be anxious.

Why? Interest rates rising maybe, but until our supply catches up with demand prices will not be dropping. And that wont be happening any time soon unless a mass unemployment scenario arises and the demand itself disappears.

Pussyhands

https://www.boards.ie/discussion/comment/118511074#Comment_118511074

Demand has outstripped supply for the past 8 years yet prices have increased like 90% since then.

Think about why prices increase and then you might see reasons for potential rocky road ahead.

Imagine wages stayed flat, do prices increase simply because demand is greater than supply?

All it takes is one nervous cow in a herd to start the domino effect.

History shows nothing ever stays the same. Are we going to see labour shortages forever? Are we going to see houses going up 10% a year forever? The whole thing has been propped up globally for years and years more than it should. Can't be propped up any longer. The US FED are going for the lesser of two evils. Let's see what the markets and economies do now.

SmokyMo

People who recently bought most likely have fixed rate secured. They are fine.

Houses might not increase another 10% but I dont see any potential scenarios where they crater 20%+ short term.

Pandemic showed that people who are looking to buy have good job security.

There is a solid pool of buyers looking to buy.

Potentially I can see issues down the line with rates or war in eastern Europe and everything that comes with it. In bad case scenario, credit lines will be dry, or only available at high rate making housing market stagnant.

SmokyMo

https://www.boards.ie/discussion/comment/118510487#Comment_118510487

NFLX is down 20% YTD. Not because of ER. Whole growth sector is down the hole atm. Look at Hubspot which 8x from 2020 march lows and now -50% from ATH.

Peleton was a basket case.

You are looking at specific sector within a sector and not the whole market. For example value companies are doing great.

Amadan Dubh

https://www.boards.ie/discussion/comment/118511074#Comment_118511074

I think what has happened in the rental market has contributed to inflating the housing market as a whole. Sure there is demand for housing, but I don't think there is demand for 1700pm/1 bed, 2000pm/2 bed places to rent. Additionally, a lot of the demand comes from the State itself (1/3 of all tenancies get State assistance). The rental market is ripe for some price discovery.

Timing belt

https://www.boards.ie/discussion/comment/118510622#Comment_118510622

With the pandemic everyone was stuck at home all day and many probably went all in to get a nice house because they were at home all the time. With pandemic coming to an end will all those savings be spent? Will people turn to splurging on megaholidays now instead?

yeah people will splurge on holidays but not if they are serious about buying a house.

The deposits in the banks are still very high and I can't see much of a correlation or cause and effect from an overvalued stock like Netflix (that now has plenty of competition) and Irish house prices.

I would be more concerned about the Chinese economy slowing that they needed started to cut interest rates the other day, rather than a stock that every retail investor has pilled into for the past 2 years despite the fact that the pandemic has caused other companies to focus on their improving their streaming products/offerings.