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

awec

yagan wrote: »

That the kind of excuse politicans trot out when they've got conflicting interests that mean they simply won't do what they say they would.

Fianna Fail are outbidding FTBs solely to try to reverse their vote decline, which last year was their second worst result in their history. Obviously it's backfiring on them now.

I doubt there is any politician out there who would ever say that the civil service is slow.

JimmyVik

Cyrus wrote: »

i saw an interesting proposal on askabout money, basically extend the rent a room relied to landlords, you can rent out a property for 12k per annum without paying tax and if it goes over 12k then you pay tax on the lot.

maybe 12k isnt the right number but it would bring rents down youd imagine.

less tax revenue for the exchequer though.

Not a bad idea.
But as you say revenue would not be happy.
Also, the tax take could never increase as landlords would not increase above the limit.
So in the end middle income Ireland would be paying again.
Only so much blood in that stone.

John1648

John1648 wrote: »

Well, I have looked at many markets. Dublin offers the highest yield for rentals, of 7% net (9% gross), which is unheard of everywhere else.

Oh, the same is in Maldives e.g., in Male, but is too far away to manage.

No point invest to property for rent when property prices are on top

Mic 1972

Revolution 1917 wrote: »

No point invest to property for rent when property prices are on top

they are still raising tho, there is no sign of house prices slowing down and with upcoming inflation anyone who has saved up during the last few years would be better off investing now than later

John1648

mcsean2163 wrote: »

Six years ago we rented a three bed in Dublin 8 for €1,300 to our neighbors. The rent is over double that now. If you can get a 20 years deal with the council and the council doesn't go bust you'll probably be fine...

Excellent point!
Also, the council will not stop paying the rent, unlike individual tenants.

John1648

JimmyVik wrote: »

That yield only applies if the tenant feels like paying the rent.
Paying rent is optional in Ireland.
When you contact whatever company is going to manage this property for you, since you are abroad, ask them will they pay the rent if the tenant they supply decides not to pay it.
Their answer will tell you everything you need to know.

What if the Council will pay the rent, as somebody above suggested?

mcsean2163

John1648 wrote: »

Excellent point!
Also, the council will not stop paying the rent, unlike individual tenants.

Yes, that's it,risk free if you can rent to the council. It's basically a very high yielding government bond and the reason the funds are buying Ireland.

John1648

DataDude wrote: »

I would heed this advice. I may be misinterpreting, but I have taken from your comments that you do not necessarily have a vast pension fund of which this one apartment would form a small part of it.

If that is the case, and this assumed rental income is going to be a key factor in your ability to retire comfortably, I would run a mile. You won't have enough diversification and the risk of a rogue tenant is too much for you to carry. You would be far better advised investing in an Irish REIT to be more diversified...if this property is going to be one of many income streams and two years of rental arrears plus significant legal costs/repair bills etc. does not worry you - then you could consider it.

Thank you! Appreciate the advice!

What is the Council would be renting it from me?

I will have a second stream, a small pension. But of course would be hard to stomach such arrears ...

Is it easy to invest in an REIT? How does it actually work?

John1648

[Deleted User] wrote: »

No point invest to property for rent when property prices are on top

I have actually first looked at the matter 5 years ago, when I could have bought the same apartments for 80 000. Now they are 180 000.

Back then I was laughed at, being told that NEVER will the prices recover, nor the rents go up again. So that is then a total loss of 160 000 EUR, i.e. 100 000 price difference and 60 000 in lost rent.

Can a small investor allow to lose 160 000 ??!

Lots of regrets in fact ...

But what if prices indeed tumble in one year again like in 2013?

John1648

[Deleted User] wrote: »

No point invest to property for rent when property prices are on top

They were actually higher at some point in time.

Others tell me to wait yet another year, as a recession is coming, and prices will go down.

Same was the advice when covid started. Now price went up by 20 000, plus the net lost rent income was approx 12 000.

Can a small saver afford to lose 32 000???

That is the question!

And I have made such a loss in 1 year ...

Cyrus

John1648 wrote: »

I have actually first looked at the matter 5 years ago, when I could have bought the same apartments for 80 000. Now they are 180 000.

Back then I was laughed at, being told that NEVER will the prices recover, nor the rents go up again. So that is then a total loss of 160 000 EUR, i.e. 100 000 price difference and 60 000 in lost rent.

Can a small investor allow to lose 160 000 ??!

Lots of regrets in fact ...

But what if prices indeed tumble in one year again like in 2013?

You can't lose what you didn't have.

yagan

John1648 wrote: »

And I have made such a loss in 1 year ...

But if you bought and then the market plunges your loss is now baked in. There's people still in negative equity 12 years after the Bertie Bubble burst, one recent contributor on this thread said they were still worth 30% less than the purchase price.

Even though Dublin prices got a 3% bump in the last year it was on 13% fewer transactions than the previous year, a similar dynamic to 2006/07.

This last year has been a huge distortion and it's going to take a couple of quarters of unrestricted viewings to get a clear idea of the current dynamic.

Marius34

yagan wrote: »

But if you bought and then the market plunges your loss is now baked in. There's people still in negative equity 12 years after the Bertie Bubble burst, one recent contributor on this thread said they were still worth 30% less than the purchase price.

Even though Dublin prices got a 3% bump in the last year it was on 13% fewer transactions than the previous year, a similar dynamic to 2006/07.

This last year has been a huge distortion and it's going to take a couple of quarters of unrestricted viewings to get a clear idea of the current dynamic.

No relation here to previous crisis

tobsey

Revolution 1917 wrote: »

No point invest to property for rent when property prices are on top

Given an investment fund recently bought an entire estate, I would doubt prices are going to fall any time soon. I'd trust their judgement on the value of the asset more than the average commentator here.

Mic 1972

John1648 wrote: »

What if the Council will pay the rent, as somebody above suggested?

Long term renting to the council requires a little homework on your part

- Does the county have demand for social housing in the area? I made a few calls to Co Dublin and Co Meat while looking for a investment property recently and i was surprised at how the council may not necessarily be interested in a rental property that would otherwise meet open market demands very easily

- Does the estate management have restrictions with regards to long term to the counsil? Once again, surprisingly a lot of estates have strict regulations against it and while they can't discriminate against HAP they apparently can prevent LLs from renting to the council

Mic 1972

Mic 1972 wrote: »

they are still raising tho, there is no sign of house prices slowing down and with upcoming inflation anyone who has saved up during the last few years would be better off investing now than later

2 different shoes companies sent them representatives to investigate investment facilities to one country
The one company representative sent email to his boss
Boss we have huge opportunities for investment in this country ! People does not have shoes here !
The another company representative sent letter to his boss
Boss I see many losses for our investment because people does not wear shoes here

Look the most popular songs in media now that prices will rising the inflation will heavy
From my life experience I learned read this opposite I could explain you the system but you still will believe media
So is no point for wasting our time doing this

Mic 1972

yagan wrote: »

But if you bought and then the market plunges your loss is now baked in. There's people still in negative equity 12 years after the Bertie Bubble burst, one recent contributor on this thread said they were still worth 30% less than the purchase price.

Even though Dublin prices got a 3% bump in the last year it was on 13% fewer transactions than the previous year, a similar dynamic to 2006/07.

This last year has been a huge distortion and it's going to take a couple of quarters of unrestricted viewings to get a clear idea of the current dynamic.

My advise would be not to buy if you are looking to invest in a rental property with money borrowed from the bank.
If you however have the cash, this is not the time to wait because inflation will kick in, no matter what they say

Mic 1972

Revolution 1917 wrote: »

2 different shoes companies sent them representatives to investigate investment facilities to one country
The one company representative sent email to his boss
Boss we have huge opportunities for investment in this country ! People does not have shoes here !
The another company representative sent letter to his boss
Boss I see many losses for our investment because people does not wear shoes here

Look the most popular songs in media now that prices will rising the inflation will heavy
From my life experience I learned read this opposite I could explain you the system but you still will believe media
So is no point for wasting our time doing this

Actually, everybody is saying that inflation will not happen. I however dont believe that for a second

yagan

Marius34 wrote: »

No relation here to previous crisis

This time it's different! (age old adage about bubbles).

SmokyMo

tobsey wrote: »

Given an investment fund recently bought an entire estate, I would doubt prices are going to fall any time soon. I'd trust their judgement on the value of the asset more than the average commentator here.

Most hedge funds will lose you money over the span of 10 or more years. In fact over 90% wont beat the benchmark. But they'll charge hefty management fee doing it.

Mic 1972

Mic 1972 wrote: »

My advise would be not to buy if you are looking to invest in a rental property with money borrowed from the bank.
If you however have the cash, this is not the time to wait because inflation will kick in, no matter what they say

The bigger will be inflation the more people will have spend for food
The more people will have spend for food the less they will have money for property/rent/new furniture/etc
Because wages will not growing up the many people will be unemployed
The more people will be unemployed the more people will have problems pay rents what will affect property prices
From mortgage side the bigger will inflation the bigger will be ECB rates the the bigger will be mortgage and less money for food
1-2 per cent inflation per year will eat your savings 50-80 years ! That serious concern start spend your savings now is not ?
But sadly ECB finished with deflation just before Covid trying rise inflation 10 years before that so I dont see were inflation will come after Covid
The property prices in Dublin were falling before Covid so what growing after that now ? Were half country been unemployed !
And finally Denmark banks offering mortgages at 0 per cent fixed rate for 10 years !
The banks in Ireland starting offering x.xx fixed rates for 20 years !
I did not dig deeper just was trying explain you in simple words

SmokyMo

Revolution 1917 wrote: »

The bigger will be inflation the more people will have spend for food
The more people will have spend for food the less they will have money for property/rent/new furniture/etc
Because wages will not growing up the many people will be unemployed
The more people will be unemployed the more people will have problems pay rents what will affect property prices
From mortgage side the bigger will inflation the bigger will be ECB rates the the bigger will be mortgage and less money for food
1-2 per cent inflation per year will eat your savings 50-80 years ! That serious concern start spend your savings now is not ?
But sadly ECB finished with deflation just before Covid trying rise inflation 10 years before that so I dont see were inflation will come after Covid
The property prices in Dublin were falling before Covid so what growing after that now ? Were half country been unemployed !
And finally Denmark banks offering mortgages at 0 per cent fixed rate for 10 years !
The banks in Ireland starting offering x.xx fixed rates for 20 years !
I did not dig deeper just was trying explain you in simple words

An issue with inflation talk is if we look at past history, asset bubbles always popped before inflation could really start.

Marius34

Marius34 wrote: »

No relation here to previous crisis

The problem is that we are still in previous crisis and hundreds of billions printed by ECB did not help at all.

SmokyMo

SmokyMo wrote: »

An issue with inflation talk is if we look at past history, asset bubbles always popped before inflation could really start.

Were from money will come which will rise inflation ?
Mistical savings will flow the market or overpriced hotel rooms will rise inflation this summer ?
OK what after that then ? When by Central bank forecast 100K unemployed will fill the streets what will about 12-16 per cent unemployment as per 2009 recession ?

The only way inflation will happen if every employed person in Ireland will get 500 euros per month from government ! Lets say for the next year or two.
Then this will kick economy and create inflation reducing unemployment also

Timing belt

Mic 1972 wrote: »

Actually, everybody is saying that inflation will not happen. I however dont believe that for a second

There definitely will be inflation but will it be sustained or just 6 -12 months. If wages don’t keep in line with inflation it could be short lived. If people think inflation is coming down the road then they will pile into property. For the average man on the street it will just make housing more difficult. That is unless we see to much inflation that will crash the market and cause taxes to rise only then would it result in lower house prices. Personally I see the economy stop/starting for the next few years as it struggles and tries to deal with the after effects. That is once the mad spending after lockdown ends.

John1648

Mic 1972 wrote: »

My advise would be not to buy if you are looking to invest in a rental property with money borrowed from the bank.
If you however have the cash, this is not the time to wait because inflation will kick in, no matter what they say

I am indeed a cash buyer. Fearing both inflation, and further property price increases

L1011

Revolution 1917 wrote: »

2 different shoes companies sent them representatives to investigate investment facilities to one country
The one company representative sent email to his boss
Boss we have huge opportunities for investment in this country ! People does not have shoes here !
The another company representative sent letter to his boss
Boss I see many losses for our investment because people does not wear shoes here

Look the most popular songs in media now that prices will rising the inflation will heavy
From my life experience I learned read this opposite I could explain you the system but you still will believe media
So is no point for wasting our time doing this

This is a final warning to improve your posting style (e.g. have posts that actually make sense, and follow the mod instructions in Post 1) before you are thread-banned.

Do not reply to this post.

Marius34

yagan wrote: »

This time it's different! (age old adage about bubbles).

It has passed 1 year and 3 months since beginning of Covid crisis. It still surprising that some don't see how Irish Property Market is different from Credit Crisis.

mcsean2163

Mic 1972 wrote: »

Actually, everybody is saying that inflation will not happen. I however dont believe that for a second

Everybody is not saying that.

The opposite in fact.

https://www.theguardian.com/business/live/2021/may/14/markets-ftse-inflation-commodities-iron-ore-copper-oil-us-retail-sales-business-live

Pussyhands

Inflation won't really affect property prices because wage inflation isn't as reactive as commodities.

Can't pay 20% more than prices now because your wages won't have gone up 20%.

Timing belt

Pussyhands wrote: »

Inflation won't really affect property prices because wage inflation isn't as reactive as commodities.

Can't pay 20% more than prices now because your wages won't have gone up 20%.

You are right for the majority of people but If you have savings sitting in a bank that will be eroded by inflation you might want to invest in property to hedge against inflation or may loan a family member the money instead to get on housing ladder. If there is enough people like this house prices will rise with inflation.

Wanderer78

Timing belt wrote:

You are right for the majority of people but If you have savings sitting in a bank that will be eroded by inflation you might want to invest in property to hedge against inflation or may loan a family member the money instead to get on housing ladder. If there is enough people like this house prices will rise with inflation.

Deposits are definitely gonna add to this inferno, it's an awful mess

PropQueries

The Irish Times is reporting that:

"The State’s National Asset Management Agency (Nama) is close to signing off on the bulk sale of 69 apartments in Malahide, Co Dublin, to a UK-based investment fund."

It does make sense as the same article states that NAMA "is legally obliged to secure the best price for properties in the recovery of loans."

Link to article in today's Irish Times here: https://www.irishtimes.com/news/ireland/irish-news/nama-close-to-approving-sale-of-69-dublin-apartments-to-uk-based-fund-1.4567753

yagan

Marius34 wrote: »

It has passed 1 year and 3 months since beginning of Covid crisis. It still surprising that some don't see how Irish Property Market is different from Credit Crisis.

Each bubble and bust is different, but human nature remains constant.

We're actually peripheral players in this bubble, as in domestically we're not the ones pumping it on like in the noughties. This yield chase bubble is funded by pension cash, not credit, and at some stage funds are going to default.

mcsean2163

PropQueries wrote: »

The Irish Times is reporting that:

"The State’s National Asset Management Agency (Nama) is close to signing off on the bulk sale of 69 apartments in Malahide, Co Dublin, to a UK-based investment fund."

It does make sense as the same article states that NAMA "is legally obliged to secure the best price for properties in the recovery of loans."

Link to article in today's Irish Times here: https://www.irishtimes.com/news/ireland/irish-news/nama-close-to-approving-sale-of-69-dublin-apartments-to-uk-based-fund-1.4567753

Interesting.

Some 34 apartments in the complex were sold to private buyers for an average price of €433,000 over the past 2½ years. Nama is selling the remaining unsold apartments in bulk. SeaPoint is the preferred bidder.

A twist in the tale. Seems demand is low for apartments in malahide..... that's contrary to the current narrative. 2.5 years and only 34 sold.

combat14

mcsean2163 wrote: »

Interesting.

Some 34 apartments in the complex were sold to private buyers for an average price of €433,000 over the past 2½ years. Nama is selling the remaining unsold apartments in bulk. SeaPoint is the preferred bidder.

A twist in the tale. Seems demand is low for apartments in malahide..... that's contrary to the current narrative. 2.5 years and only 34 sold.

perhaps demand is low as the price is too high lol

enricoh

combat14 wrote: »

perhaps demand is low as the price is too high lol

No price is too high for our government!

We're only the third most indebted country in the developed world and our golden goose corporation tax is heading for retirement. A non issue for our politicians! - now sign up for more top dollar 25 year leases!

Marius34

yagan wrote: »

Each bubble and bust is different, but human nature remains constant.

We're actually peripheral players in this bubble, as in domestically we're not the ones pumping it on like in the noughties. This yield chase bubble is funded by pension cash, not credit, and at some stage funds are going to default.

Now its contradiction to your previous post, about seeing same technical fundamentals to previous crisis.
When I try to say that we are not in bubble, many come and say to me that we don't know if we are in a bubble until it bust. But here you go, the same people would not contradict you.

Wanderer78

enricoh wrote: »

No price is too high for our government!

We're only the third most indebted country in the developed world and our golden goose corporation tax is heading for retirement. A non issue for our politicians! - now sign up for more top dollar 25 year leases!

once again, public debt hasnt caused the bulk of our problems, its private debt thats ultimately causing our problems, primarily related to property and land, the only way to break out of our private debt booms and busts, is to have the bulk of our debts sit on the public balance sheet, and for as long as possible

Villa05

Pussyhands wrote:

Can't pay 20% more than prices now because your wages won't have gone up 20%.

The price of housing has little to do with how much they cost to build or the occupants salaries. We are in full on bubble territory now and price is dictated by investment funds and government policy of underwriting that activity through long term leasing. Our cities are now only affordable to the very wealthy and social housing tennants. It will be interesting to see what becomes of our cities following that policy

The people who keep the city ticking over have been told to get out unfortunately

mcsean2163 wrote:

A twist in the tale. Seems demand is low for apartments in malahide..... that's contrary to the current narrative. 2.5 years and only 34 sold.

With little demand, it's inevitable that these will end up back in state hands through long term leasing.

Those that have purchased may be regretting there purchase. Gov policy will have serious implications for demand for new builds

Would you pay half a million for housing knowing your neighbour is getting there housing for very little

Mic 1972

mcsean2163 wrote: »

Everybody is not saying that.

The opposite in fact.

https://www.theguardian.com/business/live/2021/may/14/markets-ftse-inflation-commodities-iron-ore-copper-oil-us-retail-sales-business-live

Read the comments on this board and see all "financial experts" saying that inflation won't happen. Same on many other blogs and news outlets.

Personally i doubt that helicopter money is free.

Ozark707

Villa05 wrote: »

With little demand, it's inevitable that these will end up back in state hands through long term leasing.

Those that have purchased may be regretting there purchase. Gov policy will have serious implications for demand for new builds

Would you pay half a million for housing knowing your neighbour is getting there housing for very little

It certainly appears there is a very high likelihood of this happening given how far Malahide is from the CC it won't be an attractive location for the 20 somethings working in the tech companies in D2/4. If they are going to be looking for 2k+ for a 2 bed then the council will end up taking these.

Villa05

yagan wrote:

We're actually peripheral players in this bubble, as in domestically we're not the ones pumping it on like in the noughties. This yield chase bubble is funded by pension cash, not credit, and at some stage funds are going to default.

Bang on. Same issue different vehicles.

The bailed out finance industry have just found a different way to cause the same problem at great short term profit for themselves with little/no regard for the long term consequences.

They'll be seen as too big to fail and off we go again

Himnydownunder

Is it just me or does the U.K. give more options to buyers of houses? Quite major cities like Manchester and Liverpool offer quite good value for money. You would get a decent place in Liverpool for 100k or less. Lesser cities like Peterborough and the like offer good bang for your buck. There are viable affordable options when it comes to cities across the water, once you leave London. In Ireland when you go outside Dublin, cities like Cork, Limerick and Galway are all still quite expensive.

Cal4567

Villa05 wrote: »

The price of housing has little to do with how much they cost to build or the occupants salaries. We are in full on bubble territory now and price is dictated by investment funds and government policy of underwriting that activity through long term leasing. Our cities are now only affordable to the very wealthy and social housing tennants. It will be interesting to see what becomes of our cities following that policy

The people who keep the city ticking over have been told to get out unfortunately



With little demand, it's inevitable that these will end up back in state hands through long term leasing.

Those that have purchased may be regretting there purchase. Gov policy will have serious implications for demand for new builds

Would you pay half a million for housing knowing your neighbour is getting there housing for very little

Dublin is turning into London, San Francisco, Boston, Sydney, Auckland. You name it.

Sounds very defeatist but in reality, why should we be any different to anywhere else in modern western democracy. The answer is to look at those named areas, and others, and see how they are beginning to deal with it. We, being a relatively small piece of land, are a bit different, because it's all Dublin, Dublin & Dublin.

Cal4567

Himnydownunder wrote: »

Is it just me or does the U.K. give more options to buyers of houses? Quite major cities like Manchester and Liverpool offer quite good value for money. You would get a decent place in Liverpool for 100k or less. Lesser cities like Peterborough and the like offer good bang for your buck. There are viable affordable options when it comes to cities across the water, once you leave London. In Ireland when you go outside Dublin, cities like Cork, Limerick and Galway are all still quite expensive.

No, it's not just you. A couple of cousins of mine have been working in those areas and they doubt now they'll ever be back here. Scotland seems similar.

L1011

John1648 - if you post that copy/paste post on here one more time I'm forum banning you for spamming. End it. You have got more than enough responses over multiple threads

MacronvFrugals

PropQueries wrote: »

The Irish Times is reporting that:

"The State’s National Asset Management Agency (Nama) is close to signing off on the bulk sale of 69 apartments in Malahide, Co Dublin, to a UK-based investment fund."

It does make sense as the same article states that NAMA "is legally obliged to secure the best price for properties in the recovery of loans."

Link to article in today's Irish Times here: https://www.irishtimes.com/news/ireland/irish-news/nama-close-to-approving-sale-of-69-dublin-apartments-to-uk-based-fund-1.4567753

The optics of this are shocking for the government, this keeps housing front and center.

yagan

Marius34 wrote: »

Now its contradiction to your previous post, about seeing same technical fundamentals to previous crisis.
When I try to say that we are not in bubble, many come and say to me that we don't know if we are in a bubble until it bust. But here you go, the same people would not contradict you.

I'm not going to argue with anyone about the nature of asset bubbles, they simply happen. Some people think Bitcoin is an asset!

We're seeing an asset inflation in our property market again, although the players and financial inputs are different, and thus how it unwinds will be different too.

When I warned family and friends against buying in 2006 I was told inflation would eat away the debt. And now the same argument is being trotted out again on this thread.

Hands off regulation seems like a rerun of the noughties up to the point when the Maynooth purchase stoked an existential crisis amongst the comfortable majority who now feared a cookoo fund would buy the house next door and move in the neighbours from hell.

Himnydownunder

Cal4567 wrote: »

No, it's not just you. A couple of cousins of mine have been working in those areas and they doubt now they'll ever be back here. Scotland seems similar.

Thanks. Yeah it’s like there is some rationality in the U.K. People have some chance to make a go of life, if they are willing to live outside of London. I couldn’t believe it when I saw you could buy in Liverpool for £50k. It’s like we have a very insular view of property and property prices in Ireland. To think that it is “normal” to pay 500k for any half decent property in Dublin is lunacy.