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

drogon.

https://www.boards.ie/discussion/comment/119679927#Comment_119679927

Oh okay. The only issue is a lot of business break even during q4, so going crazy might have a knock of effect.

Villa05

https://www.boards.ie/discussion/comment/119677696#Comment_119677696

It would appear the markets liked the energy unit price cap and the measures to tackle Nimbyism. It was the unfunded tax cuts that shook markets

https://youtu.be/HN9fVqPBfI0

Timing belt

https://www.boards.ie/discussion/comment/119680296#Comment_119680296

That’s debatable whether they liked energy caps….it’s a blank cheque as no-one knows where energy prices will go. It provides uncertainty for UK finances and we know that investors lost confidence in the UK’s ability to maintain a balanced budget.

There is a lot of political spin just look at the advisor to the government on sky news last night….talk about a load of rubbish coming out of his mouth. At the end of the day the rising yield on gilts is down to investors repricing the risk. Writing a blank cheque is a very large risk

fliball123

https://www.boards.ie/discussion/comment/119680255#Comment_119680255

I dont see them having a choice to be honest we will be up at about 4% (at least) by this time next year

Timing belt

https://www.boards.ie/discussion/comment/119679291#Comment_119679291

well they won’t build at a loss so don’t see the price dropping instead projects will be put on hold which means less new buildings

fliball123

https://www.boards.ie/discussion/comment/119680413#Comment_119680413

Well the fly in that ointment is the social housing builds so there will be builds going ahead regardless.

https://www.boards.ie/discussion/comment/119679752#Comment_119679752

Think the regulations to prevent this happening again are in place. You can view the answer to the queries raised by Doherty here:

https://www.oireachtas.ie/en/debates/question/2021-11-02/358/#pq-answers-357_358_359_360

I’m not sure how the Government could hold Homebond to account, unless it has changed, the time bar for Homebond was 10 yrs.

And home insurance policies may not cover/have exclusions relating to construction.

The big issue for homeowners is that no regulation existed 20 yrs ago and new legislation may not be able to be applied retrospectively for legal reasons. Also, a considerable number of the builders/developers are limited companies and no longer trading, so trying to hold them responsible is a legal dead end. There are things you as an employer, self employed or even an employee do today on behalf of your employer which may in future be illegal, but that is unlikely to mean you will be retrospectively penalised when legislation changes. Today, you are not doing anything which is prohibited.

There is no doubt that the block manufacturers should be held accountable, particularly if they knew their products were defective. But they will argue that at the time they did nothing wrong.

There is also a possibility that a number of these houses were self build, I did this myself in my current home. I ordered and paid for a lot of materials and got builders to erect/fit them, so if my home was found to be affected, the buck would stop with me.

fergus1001

https://www.boards.ie/discussion/comment/119678115#Comment_119678115

most of those materials rose on the back of high demand/ shortage, prices will go down if there is no demand

drogon.

https://www.boards.ie/discussion/comment/119680413#Comment_119680413

Well if interest rates keeps rising, sure REIT may stop building as investment funds may get better returns on the bond market. Surely all the government funded programs should continue as expected.

https://www.boards.ie/discussion/comment/119680450#Comment_119680450

Initially yes, but if costs of production and transport continue to remain high, they won’t be sold at a loss even if demand falls. We have already seen one of Germanys biggest steel producers close down one of its two factories rather than continue production at a loss.

timmyntc

https://www.boards.ie/discussion/comment/119680444#Comment_119680444

The overwhelming majority of affected houses were not self-builds. There are endless housing estates all suffering from the same issues.

Re: Homebond, many people tried to claim within the 10 years but were not successful. Homebond, like insurers and like government all seem content to pass the buck to someone else, and in the end nobody is responsible.

https://www.boards.ie/discussion/comment/119680552#Comment_119680552

The developers in those estates are more than likely long gone, their companies liquidated. You can try suing the company, but you are throwing good money after bad.

Have you ever read a Homebond policy? It is not an all inclusive document, it has exclusions. Saying Homebond should have paid the owners is fine, but do you know if they are paying for something that is included in their range of cover?

Villa05

https://www.boards.ie/discussion/comment/119680580#Comment_119680580

Is it not still common practice for a company to dissolve after a building is completed rendering the current expensive oversight useless

Timing belt

https://www.boards.ie/discussion/comment/119680450#Comment_119680450

if input costs increase such as the energy cost in concrete the price won’t drop bellow the cost to produce.

flexcon

I'll probably leave these thread as it's honestly affecting my mental space.

I'm thoroughly disgusted. Looks like the house is out of reach again for another few years. Just heart breaking.

Timing belt

https://www.boards.ie/discussion/comment/119680443#Comment_119680443

Thats what should have happened after ‘08 but Germany and the IMF wouldn’t allow it. If it did we would have retained workers in the sector and wouldn’t have the sh1t shower we have now.

will be interesting to see what peoples opinions are if the cost of building social housing is more than the value of there own houses…..

fliball123

https://www.boards.ie/discussion/comment/119680785#Comment_119680785

I cannot see costs staying up. Global slowdown of construction. People who want to remain employed in the sector for either raw materials or building will have to become more competitive or hit the wall , just like every other industry. I mean look at China construction will be gone from here for the guts of a decade with the crap going on there, those workers and those raw materials that would of been used will have to be picked up by someone else there is also a cost in storing these materials, so like I say compete or hit the wall the idea that prices will continue to rise is crazy people cannot afford it as it is. So there will be a period of head shaking going on in the construction sector before the reality bites.

Bass Reeves

https://www.boards.ie/discussion/comment/119679648#Comment_119679648

No this will be the first of the pain for businesses and consumers in Ireland. Banks absorbed the first two rate rises with the exception of trackers. Even at that rates for personal lending may not rise as these rates are exceptionally hight at 6.5-7%+ in Ireland

Bass Reeves

https://www.boards.ie/discussion/comment/119679752#Comment_119679752

Homebond never had the money to pay out f@@kall. It was ran for the benifit of those working in it. It's used to try to get builders and developers to rectify issues.

It's not insurance companies job to mop up building issues. There presumption is that the build is structurally sound

Timing belt

https://www.boards.ie/discussion/comment/119680935#Comment_119680935

Just like a restaurant that has a huge energy bill…demand dropping won’t make them lower there prices if they’re operating at a loss. They will shut up shop.

Construction is no different…if it costs more to cut down a tree and turn it into building material due to high oil prices they won’t be cut down. Steel/concrete both high energy users so will be expensive to produce.

unless energy prices drop prices won’t drop…what you are describing is deflation in the economy which is the exact opposite to what we currently see

fliball123

https://www.boards.ie/discussion/comment/119681200#Comment_119681200

Energy will not remain as high as it is, it cant its not affordable as can be seen by the budget, already before this crisis there was a shift to countries turning to wind and solar (not sure how far away we are from this) and this has been escalated with the war. If your looking at the 2 industries you just mentioned for every restaurant/house their are customers if the customer does not see value in the menu or in the building they wont go to the restaurant and the person will not buy the house and the restaurant and the construction company will shut more because demand is gone, the person owning and working in the restaurant/construction company has the choice of closing up or trying to lower their prices there is a lot of profit that goes into a builders pocket for example and its not like construction workers can head off to other countries as their is a global slow down in that particular area so do they retrain in to another field.

Timing belt

https://www.boards.ie/discussion/comment/119681269#Comment_119681269

You totally miss the point by assuming energy prices will drop. Energy prices are high because of geopolitical events not because of supply and demand. And the lead time to change to alternative forms of energy takes a long time. As long as there is conflict with Russia energy prices will remain high. As long as energy prices are high it will feed into construction costs.

IWW2900

https://www.boards.ie/discussion/comment/119681307#Comment_119681307

While Russia sped up process somewhat, we were always headed towards an energy crisis due to government policy.

Jonnyc135

https://www.boards.ie/discussion/comment/119681307#Comment_119681307

Correct the era of cheap energy especially electricity powered by Russian gas is over and never comming back. We will just have to get used of higher electricity prices.

Timing belt

https://www.boards.ie/discussion/comment/119681398#Comment_119681398

Of course it will fast track things but it still takes a few years to build an offshore wind farm or move over to an alternative fuel

IWW2900

https://www.boards.ie/discussion/comment/119681435#Comment_119681435

....

Timing belt

https://www.boards.ie/discussion/comment/119681427#Comment_119681427

And higher energy prices mean more inflation as it feeds into the price of everything. Just look at food…high energy makes it more expensive as machines use diesel and fertiliser needs a lot of energy….then right up the chain you get add costs with production and transport increases due to energy.

you either change the model by using less energy (if possible) or pass on the costs to the consumer

mcsean2163

https://www.boards.ie/discussion/comment/119681435#Comment_119681435

What happens at night when the wind doesn't blow? Renewables that have a ten year lifetime and cost significant energy to manufacture do not solve the storage problem. We need nuclear, geothermal or hydro, something that can be guaranteed without leaving us exposed to countries that are unreliable.

fliball123

https://www.boards.ie/discussion/comment/119681307#Comment_119681307

We seen with covid how fast things that historically we were told will take ages to do or change but it didn't take long at all. I believe that after the winter things will go even quicker with regards to energy and the emphasis on finding a much cheaper solution. You miss the point that geopolitical events did lead into both supply (covid and the war both will be a thing of the past hopefully sooner rather than later) and now due these events we also have inflation (a result of the money printing for covid) which is eroding demand as the majority of people simply are not making enough money to keep up at some point prices have to drop or companies will go to the wall. Its not like its just high energy prices, its high food, interest rates and cost for everything competing for peoples money and wages have not risen anywhere near enough to keep up.

Timing belt

https://www.boards.ie/discussion/comment/119681688#Comment_119681688

And why do you think the price of food has increased? input costs… mainly energy and a lot of that has yet to hit food prices. Along with a smaller supply of food as crop yields are much lower due to less fertiliser.

Even if the war ended tomorrow energy prices would still be elevated as things will never go back to the way they were being reliant on Russia. The only way I could see energy prices dropping quickly is if a new government was put in place in Russia and current government locked up for war crimes. The likelihood of that happening is extremely remote.

The simple fact is that most construction material needs a lot of energy so prices won’t drop massively. Instead building projects will be put on hold.