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

hometruths

https://www.boards.ie/discussion/comment/122666062#Comment_122666062

Although they might seem to be worried about this metric, they're not too worried about other things:

“Ireland has not seen this level of inward migration since the 2007/08 period. This time around there is less evidence of any bubble in lending, the construction sector, house prices or investment spending,” the statement reads. “However, there are signs that overheating pressure may be starting to emerge.”

Presumably if there is no bubble, there is no risk of anything bursting, regardless of any overheating pressure.

Some good news at least.

getoutadodge

https://www.boards.ie/discussion/comment/122663593#Comment_122663593

Exactly …and add our nurses to that.

SpoonyMcSpoon

https://www.boards.ie/discussion/comment/122663061#Comment_122663061

I think leaving the tent cities but out in fields in the middle of no where while simultaneously reducing benefits would be a smart way to soft close the door on the illegitimate asylum seekers at least. Leave the hotels for genuine and family unit asylum seekers. That would help to save money and then the cash could be put to better use.

Our housing crisis is not a cash issue anyway so saving the government money isn’t going to make it better. Removing demand side subsidies and engaging in a semi-private social housing building programme are what’s needed but these are not wanted by the government or by many existing home owners as alleviating the “crisis” in the housing market necessitates more “affordable” housing as well as increased supply so house prices being forced to climb down would be a stated goal of any worth while intervention.

As someone else pointed out above there is an infantile mindset among certain Irish people that think it is sustainable for the economy and house prices to grow perpetually; while planning for hard times is not something we need to worry about. However, Ireland does not have a thriving alternative to its corporation tax nor does it have some other option to replace the government spending in the housing market which keeps prices rising. Someone explain how rents and house prices can be sustained without such extreme government intervention there? What people don’t seem to realise is that Irish politicians only live in the short-term and won’t be around to take the blame or fix the mess created from lack of planning; we can see how many FG politicians have already ran for the exit. If this isn’t a warning sign, when the housing market problems are political, I don’t know what is!

getoutadodge

"Finally, even if housing could be built at a level to sustain 100k more people here a year, I would ask whether this is even a good thing to do. I for one care deeply for the environmental sustainability of Ireland, and building on that level means clearly land, building roads and pumping out a lot of CO2, which I would have imagined would be of prime concern to the government."

I put this very argument to the Greenies the last time they came canvassing. They had a brain freeze! Maybe that's what they mean by rewilding.

But seriously if you travel around the northern outskirts of Dublin, as i frequently do, the scale of development is extraordinary in places like Maynooth, Ongar, Lucan, Leixslip, Ashbourne, Donabate etc. The woodland around Castletown House is the latest due for the chop. And it's mostly high density apartment style blocks. Coupled with this urban sprawl is the densification of the old city core in places like Marshall Yards and the Glassbottle factory. I presume the same is happening in Galway and Cork etc.

With an annual 2% population growth it can never stop - as belatedly admitted by Varadkar now that he's safely retired and pensioned off.

hometruths

https://www.boards.ie/discussion/comment/122667593#Comment_122667593

We need more high density apartment blocks and less three bed semis, the densification is a good thing.

getoutadodge

https://www.boards.ie/discussion/comment/122667615#Comment_122667615

Not disputing that. My point is the overall scale of development of all types

timmyntc

https://www.boards.ie/discussion/comment/122667615#Comment_122667615

I think posters point is that we are currently doing both. Densification and urban sprawl such is the scale of population growth we are experiencing

RichardAnd

https://www.boards.ie/discussion/comment/122667593#Comment_122667593

I recognise my own words!

There is building going up and down the country. In my adopted hometown in Wexford, there are three active building sites, and more planned. Regardless of the BER rating on these houses, nothing is "greener" than an empty field. I would also add that the same Green party would support things like rewilding as you mention, where farmers allow land to return to nature for some of those ESG bucks.

The greens are pseudo-environmentalists. They are communists trying to sneak their ideology in in a green envelope.

getoutadodge

https://www.boards.ie/discussion/comment/122668331#Comment_122668331

Indeed. I like some of the things the Greenies are doing such as rolling out cycling infrastructure which I personally benefit from. More importantly, I agree on the biodiversity crisis and the urgent need to make space for nature on say the totally sheepwrecked (and now sitka deer) uplands of the country…or the need for example marine parks (we are after all an island nation). Yet they go completely off the rails on everything else in governance with star performers like Roderic O Gorman clearly for the birds.

hometruths

https://www.boards.ie/discussion/comment/122654755#Comment_122654755

There were FF kites flown about this last year according to the Indo but haven't heard much about it this year.

It is widely leaked that HTB will be definitely extended as is to 2029. Maybe they'll take the opportunity to extend it to second hand homes.

I'd like to see it scrapped completely, but if it is going to be part of the market I think I'd prefer to see it applied to all homes. I don't really get why it should only be new builds.

https://www.independent.ie/irish-news/budget-plan-to-help-first-time-buyers-purchase-second-hand-homes-amid-pressure-to-extend-schemes-beyond-new-builds/a45804983.html

Bass Reeves

https://www.boards.ie/discussion/comment/122668389#Comment_122668389

Very few mountains now overstocked, if anything under grazing is an issue as there is very little money out of mountain lamb. Lads keep minimum stock levels to draw payments.

Deer and crows are significant biodiversity issues. Neither has a higher predator although buzzards are making a very small dent in the crow population

Blut2

https://www.boards.ie/discussion/comment/122669194#Comment_122669194

The theory/justification was by only applying it to new builds it would drive up the price of new builds over second hand homes, increasing the profitability for builders to build them and so increasing their numbers.

Which does make some sense.

But its still a ridiclously wasteful measure when the core problems are the lack of supply (from lack of capacity in the construction industry) and the ever increasing demand (from population growth), neither of which it actually addresses.

Bass Reeves

https://www.boards.ie/discussion/comment/122669194#Comment_122669194

There are two targets of HTB one give first time buyers a help to fund the deposit and a hand to buy a hone, it also gives builders an incentive to target this market. Allowing it on second hand market will not cause more houses to be build.

The refurbishment Grant encourages those with out a house to look at refurbishment options. It's now going to be extended to former commercial buildings in urban area and to refurbishment jiving area above these

hometruths

https://www.boards.ie/discussion/comment/122669790#Comment_122669790

https://www.boards.ie/discussion/comment/122669792#Comment_122669792

Applying it to second hand homes will obviously not cause more houses to be built but the same logic presumably applies that if it pushes up prices of second hand homes it will incentivise owners of second hand homes to place them on the market for sale.

i.e if the logic is sound as a measure to increase supply of new builds for sale it should be sound to increase supply of second hand stock for sale.

The most important metric is how many homes are on the market for sale, irrespective of whether they are new build or second hand.

Bass Reeves

https://www.boards.ie/discussion/comment/122667615#Comment_122667615

The problem apartments are.much more expensive to build than houses. There is planning for about 50k apartments in Dublin but they are not viable to construct

https://m.independent.ie/business/unviable-construction-stalls-on-more-than-50000-dublin-apartments-despite-having-planning-permission/a568753809.html

Bass Reeves

It will add very little or nothing to supply. It may but unlike encourage investors to sell up but that actually reduces household density. Nobody rents a bigger house than they need generally. There is not a significant number of empty unused houses there fore all it would do woukd be a subsidies to house owners that intend to sell anyway.

The refurbishment grand encourages the sale of empty houses which are vacant longer than a year abd it incentives owners to refurbish them either to rent or to sell to a qualifying person

hometruths

https://www.boards.ie/discussion/comment/122670022#Comment_122670022

There is not a significant number of empty unused houses

I think the data we have suggests otherwise. This is exactly the source of supply we should be trying to unlock.

The refurbishment grand encourages the sale of empty houses which are vacant longer than a year abd it incentives owners to refurbish them either to rent or to sell to a qualifying person

The inherent problem with the refurbishment grant, whilst a good idea in principle, is it incentivises vacancy in order to qualify for it. No idea to what extent this is happening, but the incentive is definitely there.

hometruths

Looks like no HTB for second hand homes in today's Budget. Nor any other measures to try and increase second hand supply. A bit of a missed opportunity I think.

DataDude

https://www.boards.ie/discussion/comment/122672144#Comment_122672144

6% stamp duty on sales over €1.5m seems quite extreme and very under the radar. Suspect it will put the breaks on quite a few downsizers which we already don’t have enough of!

Strange decision. Can’t imagine it is even a big revenue generator.

fliball123

https://www.boards.ie/discussion/comment/122672220#Comment_122672220

Was that 6% on the amount over 1.5million or the full amount?

DataDude

https://www.boards.ie/discussion/comment/122672234#Comment_122672234

Excess I assume, if consistent with how they operated it previously with the 2% rate over 1 million.

hometruths

https://www.boards.ie/discussion/comment/122672220#Comment_122672220

Yep, I don't think anyone saw that coming.

Suspect it's just a populist sop to the left, but as you say not that helpful in encouraging downsizers.

hometruths

https://www.boards.ie/discussion/comment/122672234#Comment_122672234

Irish Times reporting this in their liveblog but have not seen it elsewhere:

The existing rate of 1 per cent will continue to apply to values up to €1 million, and 2 per cent on values above €1 million.

and then presumably 6% on balance over 1.5m

Villa05

https://www.boards.ie/discussion/comment/122672220#Comment_122672220

Is it a kick back from an easing of inheritance tax

DataDude

https://www.boards.ie/discussion/comment/122672370#Comment_122672370

You could be right. Unusual one though. We don’t ‘need’ the revenue.
It’s not particularly effective at raising revenue anyway. It will reduce liquidity of more expensive homes which is bad.

I’m struggling to see the angle. Seems like a classic dumb populist policy without any economic rationale. Unless I’m missing something! Something I’d have expected from SF, not FG.

timmyntc

https://www.boards.ie/discussion/comment/122672380#Comment_122672380

The idea that FG are fiscally responsible and not populist is about a decade out of date.

They lambasted SF for magic money tree proposals and then have gone seemingly off the deep end throwing money around like it's coming off the trees. Since COVID they've gotten addicted to big splurging expenses, and all sense of fiscal responsibility is well and truly gone.

Even before this budget, we have schemes that do nothing but fuel inflation like HTB, croi conaithe, mortgage interest relief, etc

RichardAnd

https://www.boards.ie/discussion/comment/122672576#Comment_122672576

Never mind since Covid. They created/printed/borrowed north of 50 billion to keep the lockdowns going. That's an unheard of amount of cash to let loose in just two years.

DataDude

https://www.boards.ie/discussion/comment/122672576#Comment_122672576

Will respectfully disagree on your examples, with the exception of mortgage interest relief.

They are generally are quite clever and calculated. Even with their current CAT increases. They don’t ‘believe in it’, they know it’s populist…but it’s pretty cheap and economically harmless…for lots of votes.

The stamp duty thing isn’t going to win any votes because people don’t care….and it’s probably going to be economically damaging. I just don’t see where they got it from.

Bass Reeves

https://www.boards.ie/discussion/comment/122672234#Comment_122672234

https://www.boards.ie/discussion/comment/122672252#Comment_122672252

Usually stamp duty is paid at the rate on the total amount. Did not know tgat about houses in excess of a million. If it on the total amount it dampens demand to go over a certain price as a euro over the threshold has significantly implications.

DataDude

https://www.boards.ie/discussion/comment/122672744#Comment_122672744

Certainty in the past it was 1% up to €1m and 2% on any amount over €1m…I’ve paid it!

2% is relatively harmless and unlikely to influence decisions much. 6% would certainty make you think though.

I thought generally feeling on stamp duty is that it’s bad because it reduces liquidity.