How to make money of the rising property prices?

doctorg

We are in cycle of intense demand of residential properties where everyone is paying above market prices, thus making the market go higher every month.

Property developers are building new homes as fast as they. Any new development is sold out almost instantly with hundreds of people on the waiting list.

With the above in mind, what's the best way to go about making money from this market, other that directly buying/selling property?

There is be demand for mortgages so banks like BOI/AIB seem like obvious picks to invest in. What are other share picks or ways to benefit from this market cycle?

Buddy Bubs

Apart from the fact I'd guess we are at or very close to top of market, there are dedicated property funds you can invest in, Irish and international. Goodbody, Davy, Irish life, all the life and pensions companies actually.

Jim2007

So how much are you willing to loose?

You are late to the party, don't understand the sector, don't appreciate that it is the highest risk asset class you are likely to speculate in and have not figured it out.

Best advice stay from the banks, all you are doing is investing in a commodity sector with a hugh exposure to the property sector when blows and it will blow, you just don't know when.

Padre_Pio

You're about 10 years too late unfortunately.

There's too much unpredictability in property market, too much government interference, too much exposure to global events, and an election less than a year away. Safer ways to make money. I heard of a crowd called Property Bridges, which might be worth looking into if you're really sure about investing in property

3DataModem

https://www.boards.ie/discussion/comment/122345568#Comment_122345568

The top of the market will be found once rental yields drop, rental yields are still very very high in Ireland. They are also much less volatile than purchase prices. You can buy an apartment today with 6.5% rental yield after management and letting agent fees. As a long-term illiquid investment for cash it is pretty damn hard to beat; no deemed disposal, generally inflation proof income, generally inflation proof capital appreciation, and the fear of overholding risks in Ireland keeping smaller investors out.

FlipFlopAgain

The REIT was supposed to be the answer to the OP's question. AFAIK, IRES is the only REIT remaining in Ireland and it has performed terribly over the last number of years. The rental price increase cap is a large reason for its poor performance. There are also other reasons.

Most of the property funds out there run by the main life insurance companies are mainly invested in commercial property and they have also been doing very poorly since Covid and work from home. The Central Bank was warning recently that these funds are likely to continue doing poorly for the next few years.

Maybe the answer is to purchase shares in some of the listed construction companies, such as Cairns. Of course you're taking the risk as all the expected property price rises are most likely already priced in to the share price. So, if property prices don't continue to rise as much as expected, or if they start to fall, then the share price of the construction company will also fall.

Bottom line: I think it's too risky. Better off investing in diversified shares or a market index IMHO.

gym_imposter

https://www.boards.ie/discussion/comment/122353031#Comment_122353031

REITs have been a disastrous investment in Ireland but then again REITs are really a bond proxy rather than any sort of property market tracker

Ubbquittious

IRES is tanking horribly. Thankfully if you want to make money off of poor bastards struggling to pay rent and buy a house there are similar companies in the US you can easily buy shares in

Geuze

https://www.boards.ie/discussion/comment/122346258#Comment_122346258

Gross rental yields are so high, as rents are extraordinarily high.

3DataModem

https://www.boards.ie/discussion/comment/122592348#Comment_122592348

Yep. But even with a 30% drop in rental yield, the investment holds up IMO.

chrisd2019

https://www.boards.ie/discussion/comment/122592348#Comment_122592348

However currently building a unit to rent is also very high and to make a profit requires you to flip it to make a capital gain, as long-term yield is not guaranteed and the regulatory burden associated with renting mountainous.

Personally lived to through the last Irish property bubble without buying a rental property and have never regretted it!