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

Amadan Dubh

https://www.boards.ie/discussion/comment/118526065#Comment_118526065

So based on your anecdotal experience, my anecdotal observation is not correct? That doesn't make sense. We have differing opinions based on similar anecdotal experiences I think is more accurate.

Eclectic Econometrics

I have talked about black swans in posts moons ago, things such as whether inflation is really transitory and Evergrande. I am looking at the market and it is bleeeeeding. The 'winners' list DOW stocks are in minus! LMFAO. Recently there has been relatively quick bounce backs but I get the feeling this is it, this is going to be at least a correction if not a bear market.

We've also got a potential war brewing.

Nothing surprises me with Dublin house prices, though. The nukes will be flying and and prices in Howth will be up 5% :-)

Did you guys make a beginning of the year prediction on house prices? Predictions for % increase/decrease inside and outside of Dublin? I may have missed it.

Timing belt

https://www.boards.ie/discussion/comment/118526052#Comment_118526052

How do you know that the rich were net sellers the past year and have converted to cash?

Any wealthy investor will have a balanced portfolio and won't be holding a large portion in cash especially during an inflationary period where cash looses value.

Timing belt

https://www.boards.ie/discussion/comment/118526317#Comment_118526317

https://www.boards.ie/discussion/2058225948/irish-house-prices-2022-predictions

Eclectic Econometrics

https://www.boards.ie/discussion/comment/118526473#Comment_118526473

Top man, thank you.

fliball123

https://www.boards.ie/discussion/comment/118526317#Comment_118526317

And yet you and all the rest of the doomsdayers have given zero input into how the supply/damand issues are too be managed, black swan white swan you can show me all the swans each with a different color of the rainbow and prices are not going to drop simply because a certain cohort want it and want it now. Until supply/demand issues are addressed there will be no drops. Even when nukes are flying people still need a roof over their head, unfortunately there currently seems to be too many heads and not enough properly maintained roofs to allow prices to drop or even stand still

hometruths

https://www.boards.ie/discussion/comment/118526473#Comment_118526473

Why is that in the Laois forum?!

Thestart

Was thinking that myself

Amadan Dubh

https://www.boards.ie/discussion/comment/118526487#Comment_118526487

The demand is being pumped by the State; supporting 1/3 of all rentals and putting a floor on rents by doing this (including by implementing RPZs and kicking out small landlords from the market). Rents at current levels put more and more people every day into the bracket of needing support; do you think that the net can perpetually widen? If so, I'd very much like to drink from that coolade as it is essentially a "there's a magic money tree" attitude where the State can happily borrow (yes, borrow) to pay into housing market supports. There is nothing sustainable about the situation unless you think the State can keep increasing its spend on housing by increasing its borrowing.

Amadan Dubh

https://www.boards.ie/discussion/comment/118526328#Comment_118526328

Elon Musk and his brother dumping shares of Tesla; Michael Burry (infamous housing market shorter pre-2008) has already moved out of big tech stocks and into cash; Zuckerberg has sold billions worth of Facebook shares in the last 12 months; Warren Buffett/Berkshire Hathaway; Google's founders have sold hundreds of millions worth of shares this year for the first time since 2017

fliball123

https://www.boards.ie/discussion/comment/118526604#Comment_118526604

Sorry but this is our bleeding heart lefties pushing that agenda and now we have a certain cohort who now feel they are entitled to this. We have a history of giving monies to certain groups that are so hard to take away. Both what we pay for our welfare and public sector are shining examples of this. The funny thing is people believe the shinners will sort the housing crisis and they are more left leaning than any party that are currently in government currently. So the heads are still there that need housing and we still have not got enough houses., people who have been given supplements for housing or free housing will not have it taken away. Imagine the negative headlines of any government party taking HAP or FTB or any other support deemed necessary for those who cant afford to get on the ladder. (I think it should all go by the way just cant see it happening). Also a lot of these reliefs and options have been part of the narrative in this country for decades. So how do you go about taking that away? You throw in the rising of both building related labour and building costs not to mention a shortage of both. Also we are out of lockdown supports such as PUP will IMO be ending within the next 6 months (i could be wrong if another corona wave hits) so what they are paying out will come down.

So lets see people on here who have tried to come up with a narrative of prices coming down have put down the following

Evergrande collapse.

Interest rate hikes.

inflation vs Low wage inflation.

How can the gov support 1/3rd of rents.

While some of this may lead into what the cost of a house is in this country, IMO the following trends would suggest to me prices will not be coming down but increasing for the next 3/5 years.

Shortage of building laborers/building materials

increase in costs for both building labor/building materials

Increase of approx 1/2 a million people over the last decade

Feck all building of housing over the last decade

No way of forcing people to for rent themselves when they are used to the state paying for them

State have very limited financing to help build due to its current debt and deficit.

Reduction in time from 8 years to 4 months for undocumented non nationals to be able to work here - This will bring a lot of people to our shores.

The globalization of property meaning billy and mary are competing with companies and other people from other countries.

Vulture funds/REITS buying up more property and the small landlord leaving due to the punitive nature of being a small landlord. The Vultures will have the power to keep rents high.

So that is why I have made my prediction another 3 years of price rises at the very least

Timing belt

https://www.boards.ie/discussion/comment/118526625#Comment_118526625

Michael Burry got burned with his short positions last year so may have needed the cash to cover his losses.

Warren Buffet hasn't dumped his shareholding all that he has said is that their is little out there worth investing in while his cash reserves build from his investments.

Zuckerberg/Google/Elon Musk of course they sold shares just look how overvalued all those stocks were.. they have dropped a fair bit since November and probably still have another 10-20% to go..... Just because they sold high doesn't mean they are keeping the sales proceeds in cash they could have invested in other stocks/bonds/crypto/property..... How do you know they kept the sales proceeds in cash and lost 5-8% a year due to inflation?

Timing belt

https://www.boards.ie/discussion/comment/118526541#Comment_118526541

Good Question... maybe a mod can move it

Eclectic Econometrics

https://www.boards.ie/discussion/comment/118526487#Comment_118526487

I am not a doomsdayer. I have consistently said that I have no clue as to where the housing market in Ireland is going and where we will be in a year or five etc.

Cheers.

hometruths

https://www.boards.ie/discussion/comment/118526870#Comment_118526870

I guess I'm a doomsdayer!

JimmyVik

https://www.boards.ie/discussion/comment/118526317#Comment_118526317

There is a thread. Probably same people making the same predictions they make every year, just changing their reasons a bit.

Sunny Disposition

I did exit the market a few years ago, because I felt the fundamentals were very poor, so I guess I'm a doom monger!

Anyway, the fundamentals are still pretty weak I think, but it might take a couple more years to filter through. With the type of immigration regulations and economy we have it's going to be very difficult to ever have a stable housing market I feel. Construction is pretty hectic at the moment so I'd hope some of the pressure is taken out of the market in a year or two, but it might not happen, prices could get even higher.

Timing belt

https://www.boards.ie/discussion/comment/118526625#Comment_118526625

Thought you would be interested in this article seeing as it lists most of the guys you mention

https://markets.businessinsider.com/news/stocks/billionaires-stock-market-losses-warren-buffett-berkshire-hathaway-net-worth-2022-1?utm_campaign=browser_notification&utm_source=desktop

cnocbui

https://www.boards.ie/discussion/comment/118532264#Comment_118532264

They are still up $575b since the start off the pandemic.

hometruths

https://www.boards.ie/discussion/comment/118532381#Comment_118532381

A lot of it not just on paper - Bezos, Musk, Zuckerberg, the Google pair and I'm sure many more tech entrepreneurs all banked mega gains last year selling stock.

HBC08

https://www.boards.ie/discussion/comment/118523830#Comment_118523830

House prices will go up a lot more before they come down.Its the very most basic rule of economics,supply and demand.

Supply cannot catch up with demand in the medium to long term,I can't see any scenario where it does.

Timing belt

https://www.boards.ie/discussion/comment/118532381#Comment_118532381

Of course they are but they didn't sell everything and hold cash waiting for a collapse as we were lead to believe was the case

Villa05

https://www.boards.ie/discussion/comment/118532504#Comment_118532504

Going to be an interesting few months for US stocks in particular. Cancel those avc's better price point at the end of year I suspect.

Will be interesting in how it spills over into property

Timing belt

https://www.boards.ie/discussion/comment/118532705#Comment_118532705

It all depends on how long the stock market bleeding continues and what the fed come out with tomorrow.

At the moment the only impact that I can see is where people have invested their house deposit in the stock market rather than keep it in a bank but they should still have it if invested wisely and didn't chase the tech stocks like the majority of retail investors.

Timing belt

I came across an Interesting paper on housing supply Elasticity in Ireland this morning whilst looking at the Central banks Quarterly bulletin

The most interesting part was that for housing supply coming on stream to increase by 50% prices would need to rise 24% or costs would need to drop by 40%

Lastly, our findings have implications for public policy. It is the stated goal of Irish housing policy, in the 2021 Housing for All strategy, to increase completions from roughly 20,000 per year to over 30,000. The analysis here suggests that, for a 50% increase in supply to happen, prices would need to increase or costs to fall. Taking the 50-year analysis of national completions, the estimated HSE of 2.07 implies a 24% increase in prices would be needed to generate a 50% increase in supply. The same specification gives an elasticity of supply with respect to costs of -1.3, meaning a fall in construction costs of nearly 40% would be needed to achieve the same effect.

source: http://www.ronanlyons.com/wp-content/uploads/2022/01/Lyons-Moenert-2021-11-Housing-Supply-Elasticity-in-Ireland.pdf

JimmyVik

https://www.boards.ie/discussion/comment/118532705#Comment_118532705

People say this every few months.

Dont cancel your AVCs. That would be stupid.

greenfield21

The boom is back

https://m.independent.ie/business/irish/the-boom-is-back-as-economy-to-grow-strongly-for-years-says-central-bank-41279009.html

And more importantly I see Microsoft beats on earnings and revenue with upbeat guidance. (Irelands economy is built on US MN companies)

wassie

https://www.boards.ie/discussion/comment/118533721#Comment_118533721

Thats interesting in the context of the Central Banks bullish outlook for the economy and the end of their commentary. Somethings not adding up;

With the economy likely to approach capacity limits through 2023, planned or necessary public expenditure on priorities such as climate action, housing or healthcare will have to be carefully managed. The overall stance or composition of fiscal policy may have to be adjusted to avoid excessive inflationary pressures. Sustainably addressing challenges in housing will be important in maintaining Ireland’s competitiveness and relative attractiveness as a place to live, work and do business.

Source: https://www.centralbank.ie/publication/quarterly-bulletins/quarterly-bulletin-q1-2022

Amadan Dubh

Two things to show up the CBI in it's quarterly bulletin;

1. The inflation blame game ignores QE/public spending and low interest rates. That's like writing about the causes of climate change and ignoring the burning of fossil fuels.

2. The CBI seem to think the economy can generate 167000 jobs in the next three years. While not all of those will be taken on by new arrivals into the country, I think our housing crisis would put a question mark beside this estimate. As it stands there are 1600 rentals in the entire country available and that covers everything. This housing crisis will act as a ball and chain around economic growth unless we can get 35,000+ new homes per year out there into the market.

Black Noel

EOB

While Real Estate Investment trusts continue to pay no tax, small/semi professional landlords are paying incredibly high rates. Sinn Féin and others have proposed multiple solutions to @DarraghOBrienTD but instead, he’s sat back and watched more small landlords leave the market. https://t.co/vCaqpNIDny