House price predictions for 2023

Thargor

Prices rise by 5-10%

Lads seriously where are ye pulling these 20%+ drop predictions from? Unless you're predicting WW3 then every pension fund on the planet would be piling into Treasure Island in that instance and would support the prices on their own that way nevermind the private buyers.

We cant build a fraction of what we need in this country therefore prices rise. Simple supply and demand.

Wanderer78

Prices fall by 5-10%

https://www.boards.ie/discussion/comment/120035566#Comment_120035566

no its not, our property markets are now heavily financialised, and are deeply connected globally via financial markets, supply and demand based ideologies are basically over simplifying the situation, as property is now considered an asset class, therefore is highly sensitive to financialised shocks, which the likelihood is now increasing rapidly, largely due to rising rates and other actions such as qt, so.....

IWW2900

Prices fall by 20+%

https://www.boards.ie/discussion/comment/120035566#Comment_120035566

Lad, seriously, you have no clue what you are talking about.

C3PO

https://www.boards.ie/discussion/comment/120031935#Comment_120031935

This has been my experience too! I’ve been looking to buy in the South East for the last 3-4 months - anything that’s freshly refurbished or in really good condition sells very quickly and for above asking but houses in need of work are moving slowly and often at a reduced price.

Thargor

Prices rise by 5-10%

https://www.boards.ie/discussion/comment/120036082#Comment_120036082

Oh wow cant argue with that logic alright, looks like its cheap houses for all in 2023!

newmember2

https://www.boards.ie/discussion/comment/120036087#Comment_120036087

Indeed, mine too. Still a lot of appetite for well turned-out homes, not so much for the ones needing work.

Timing belt

Prices rise by 5-10%

https://www.boards.ie/discussion/comment/120036124#Comment_120036124

And the main reason for that is you don’t know how much the work will cost because no builder will commit to a price in the current inflationary period

Caquas

Prices rise by 5-10%

https://www.boards.ie/discussion/comment/120034988#Comment_120034988

You can borrow money today at 3% while inflation is currently around 10%, giving a real interest rate is -7%. I think that is the most attractive rate ever in Ireland. The media don’t mention this but people seem to understand it - the main complaint we hear from would-be borrowers is that banks won’t lend them more money. (Yes, I know rents are too high but my point remains).

Of course, if you believe the ECB will get inflation back to 2% over the next year, you would be less eager to borrow but the ECB has a poor track record.

inflation was higher in the 1970s but double-digit mortgage rates became the norm and later borrowers paid the price for the initial windfall which borrowers received in the early 1970s. In the 1980s, borrowers were crucified as inflation fell (wages rose more slowly) while nominal interest rates remained extremely high.

If this decade resembles the 1970s, the winners will be those who load up on debt now (especially if they get fixed rates) and pay back their loans with inflated Euros in years to come. This is not investment advice, simply an explanation of my point which you didn’t understand.

IWW2900

Prices fall by 20+%

https://www.boards.ie/discussion/comment/120037347#Comment_120037347

This is the dumbest thing I have ever heard.

Mad_maxx

Prices fall by 0-5%

Drop in first half but a fairly robust rebound in the second half

landofthetree

40% decline in prices by 2024. They will fall around 15-20% this year.

Inflation has to be brought down to 2%. The ECB will continue with the rate rises till thry have it under control. It will take a few years.

Q&A

Prices rise by 5-10%

Whatever about house prices growth I'm expecting trolling numbers to sky rocket in 2023 ;⁠-⁠)

https://www.boards.ie/discussion/comment/120036082#Comment_120036082

https://www.boards.ie/discussion/comment/120037420#Comment_120037420

Caquas

Prices rise by 5-10%

https://www.boards.ie/discussion/comment/120037575#Comment_120037575

Especially trolls who expect house prices to crash by 20+% next year 🤪

IWW2900

Prices fall by 20+%

https://www.boards.ie/discussion/comment/120037921#Comment_120037921

Remember friend, popular opinion in any market, is rarely correct. Particularly after spectacular rises in said market.

Larbre34

Prices fall by 5-10%

https://www.boards.ie/discussion/comment/120037474#Comment_120037474

Rubbish. You have not factored the extremely strong underlying demand and the ability of many buyers, outside of the most pricey sectors, to absorb the demands of more expensive credit.

You also don't seem to realise that the European Central Bank cannot tackle inflation with endless interest rate rises, without causing more damage from the rate rises that from the inflation in the first place. The other side of the coin is the obligation of the EU Commission and national governments to soften the inflationary pressures through correction of costs and supplies by political and fiscal measures.

I do expect things to soften a little, for all the above reasons and perhaps thats a good thing. But really, you are not going to see homes in high demand areas selling at a loss and for that reason, the floor on prices is no lower than -10% on older stock and in quieter rural areas and - 5% in fast growing cities with full employment.

StevenToast

Prices rise by 0-5%

How has nobody said soft landing yet?

landofthetree

Prices are already falling.

https://m.independent.ie/irish-news/revealed-the-counties-where-house-prices-fell-for-the-first-time-in-three-years-42245528.html

The biggest fallbacks in the last quarter were in Mayo (down 2.6pc), Kerry (2.5pc), Wicklow (1.1pc) and Meath (0.8pc).

Q&A

Prices rise by 5-10%

https://www.boards.ie/discussion/comment/120038157#Comment_120038157

Behind a paywall. What's the data asking or actual prices?

herbalplants

Prices fall by 20+%

https://www.boards.ie/discussion/comment/120038157#Comment_120038157

And it is always outside Dublin where price start falling first so it makes sense. 20% fall in prices will only bring us to about 2019 prices so not that low either.

Caquas

Prices rise by 5-10%

https://www.boards.ie/discussion/comment/120038231#Comment_120038231

Typical Indo clickbait, picking out three counties where prices of 3 bed semis fell but burying the main outcome of this estate agent survey.

Overall, this survey indicates that house prices nationally increased 8pc in 2022. The small increase (0.36%) in the last quarter reflects the seasonal pattern in house prices i.e. houses which don't sell in the Spring/Summer tend to be marked down to sell before the year's end.

Prices went up, down or remained the same depending on location.

However, on average, the impact of interest rates and rising prices led to slightly increasing prices in general in the last quarter, with an average rise of just 0.36pc registered. Nationwide, it represents an average increase in house prices of 8pc throughout this year, with the average price of a three-bed semi around the country now standing at €291,667.

Jmc25

Prices fall by 0-5%

https://www.boards.ie/discussion/comment/120037347#Comment_120037347

The difference between now and the 1970s though is that wage increases are running at less than half the rate of inflation (in August, inflation was 8.7 per cent and wage increases in Q3 were 3.2).

That may correct itself over time, but I feel the "keep wages low" mentality of the austerity years became so deeply embedded that even now, with inflation at 10 per cent and full employment, we're not seeing wages rise to reflect this. Madness really.

Anyway, in terms of debt burden, if you borrow 300k and inflation goes to 10 per cent next year, your ability to repay your debt doesn't increase by 10 per cent, it increases by whatever your wages go up by (well, half of that figure really when tax is factored in).

Jmc25

Prices fall by 0-5%

https://www.boards.ie/discussion/comment/120037474#Comment_120037474

There will come a crunch where the ECB have to stop raising rates or some eurozone countries will be go into serious recession and be unable to repay their debts.

Now admittedly the eurozone, led by Germany and backed strongly by Netherlands and others, have form for saying "tough luck" to these countries and crippling them anyway, but I'd like to think some lessons were learned during the last recession which will prevent that from happening again.

As for 40 per cent declines by 2024 - that would be the biggest housing market crash in history would it not? In a full employment economy (which doesn't look likely to change, in Ireland anyway), and with a huge chunk of the population stuck in rented accomodation, with the number of houses built looking set to fall next year?

I want prices to fall myself but that's fantasy stuff.

rob316

Prices fall by 10-15%

https://www.boards.ie/discussion/comment/120030459#Comment_120030459

How are commodity costs coming down? Our suppliers are already warning us of 10-15% price increases in January and an effective rate of 5% across the board. Excise and vat measures are going to be pulled by the government early next year. Ukraine war has no end in sight, energy prices will stabilize but remain high. I don't see any change to prices in commodities next year, stabile probably but again remaining high.

Prices fall by 5-10%

https://www.boards.ie/discussion/comment/120037347#Comment_120037347

Inflation doesn’t erode away debt. Wage rises do. And wages are not going up anywhere near that amount. We are not in a 1970s inflation spiral where wages chase up insulation and erode away your debt - we are in a transition to a higher cost way of life.

rob316

Prices fall by 10-15%

What I definitely see happening and is already is estate agents hawking fixer uppers for ridiculous prices will fall to more realistic prices. We are gone from the frenzy buying of the past 2 years. Anything that requires a decent bit of modernisation as they call it isn't moving.

Here's a basic calculation on "increased purchasing power" too for the average couple.

Working couple average income 90k

3.5 x = max mortgage 315k

4x = max mortgage 360k

Now go back 12 months you could borrow that 315k for 2%, we are looking at almost 4% very soon.

Let's say 315k for 30 years they took at 2% that's a repayment per month of 1164, now say they got 360k at 4% that's 1698 per month. 534 per month more, 6400 per year.

Now say John and Mary got a 5% pay rise, after tax that's about 2200.

They are still looking at 4k more a year on the mortgage even after a payrise.

There's no extra purchasing power, that's the point of a rate rise.

DownByTheGarden

Prices rise by 5-10%

I honestly cant see anywhere where a fall is going to come from.

The only way is a major economic shock to Ireland that causes mass unemployment. No jobs = no money for rent or mortgages.

Supply is never going to reach demand, ever anymore. It has gone too far. There is absolutely no way we that supply is going to catch up now.

You have landlord being encouraged by the government to get out of the market because its impossible to make evaen a reasonable profit with out massive risk for them. Then the REITs are buying up whole complexes now. And when they rent them they are top dollar rentals. All of the cheaper rents are leaving the market.

The whole thing is a mess. not enough rentals. not enough available for purchase. Neither with any prospect of ever meeting demand.

No, cant see how house prices can fall, unless that economic catastrophe happens, and if that happens noone will have jobs or money to be buy houses.

That said, I think asking prices might fall as interest rates rise to get people in the door, but at the end of the day the money chasing the houses is still there and the sale prices will reflect this even if the asking prices go down.

With inflation I think people have had their last big spending session up to Christmas. Now in the new year i think most people (certainly myself anyway) will reign in spending in anticipation of hard times ahead, even those with lots of spare cash will now look at their outgoings and cut back to put money away for a rainy day instead of spending it.

Prediciton : People will suddenly stop spending in Q1 23, be they struggling as it is or not. But they cannot and will not stop renting or buying houses to get out of the rent trap.

DownByTheGarden

Prices rise by 5-10%

https://www.boards.ie/discussion/comment/120039974#Comment_120039974

What you get for a mortgage of 1700 compared to what you can rent for €1700 a month. If you are renting at that price, you are definitely better off buying at that price.

Danzy

Prices rise by 5-10%

We built far less than needed and then added in about 120k people in the last 12 months.

The same will happen next year.

Will house builds reach 40k a year in the next 5 to 7 years, very very very hard to see that even with a Govt firmly committed to it and more and at that it would be well short of demand.

So supply can't Keep up and their is a highly aggressive free market approach to migration and refugees.

Affordability will be the only thing that tempers it as more people are priced out.

combat14

https://www.boards.ie/discussion/comment/120039974#Comment_120039974

probably looking at a modest 2-5% drop in house prices when cost of living (inflation), below inflation pay rises (halved again by taxes), continued interest rate rises and supply issues are all factored in ..

Caquas

Prices rise by 5-10%

https://www.boards.ie/discussion/comment/120039965#Comment_120039965

By definition, inflation erodes monetary debt. I already made the point that wage rises are necessary for (most) people to benefit from this effect.

I agree that there has been a substantial erosion of living standards due to inflation which, together with interest rate increases, will constrain the demand side of the housing market. Despite this, my view is that a chronic scarcity of supply (including in the rental sector) will continue to push up prices next year.

We are seeing (perfectly rational) demands for commensurate wage increases. Union power is focussed on the public sector but labour shortages have also increased the bargaining power of workers in the private sector. Unless there is a rapid reduction in inflation, I expect to see much bigger wage hikes in both the public and private sector in the coming years. That would feed into further house price increases. Whether this turns into the boom/bust of the the 70s/80s depends on the mix of fiscal/monetary policies in response to the macro environment (oil and wars, just like the 70s!).