Property Market 2018

uck51js9zml2yt · 29-09-2018 10:32pm

Samuel T. Cogley wrote: »

What was his/her reasoning for a stagnation would lead to a crash or that a crash is imminent?

There's a glut of houses in the area. A lot are overpriced and they aren't moving easily.

Graham · 29-09-2018 10:41pm

Ulises Gifted Stoicism wrote: »

There's a glut of houses in the area. A lot are overpriced and they aren't moving easily.

Now I'm even less convinced the EA has spotted an early indicator of an imminent crash.

If they're overpriced, they're unlikely to sell quickly particularly now the central bank restrictions appear to be having the desired outcome.

The Governor of the Central Bank Philip Lane has welcomed indications that the surge in house prices is showing signs of abating.

Bob24 · 30-09-2018 2:00am

Graham wrote: »

now the central bank restrictions appear to be having the desired outcome.

I've said it before but it is more of a happy side effect than a desired outcome (the Central Bank has no mandate to control house prices, those restrictions are justified by the need to protect consumers and the banking sector from excessive lending - and I would be surprised if there was any quote of the governor of the bank saying house price moderation is the desired outcome of macro-prudential rules).

Graham · 30-09-2018 2:08am

The Governor of the Central Bank Philip Lane has welcomed indications that the surge in house prices is showing signs of abating.

In an interview with Bloomberg TV, Philip Lane said that Irish house prices flatlining is "good news".

Mortgage lending caps introduced by the Central Bank in 2015 are widely credited with helping put a ceiling on house price growth this year, particularly the so called loan-to-income ration that restricts most borrowers to home loans that are no more than three-and-a-half times incomes.

https://www.independent.ie/business/personal-finance/property-mortgages/head-of-central-bank-hails-slowdown-in-surging-house-prices-37366498.html

Borzoi · 30-09-2018 12:38pm

Bob24 wrote: »

That’s part of the explaination but not the only thing.

Not only French banks offer 1.5%, but also 1.5% *fixed* for the full duration of the mortgage.

I’m not sure why, but they must have betters ways with fund themselves in the long term and/or are better at managing long term monetary risks.

Yes. Because they will also insist on 30% deposit. And that the mortgage is no more than 30% of your take-home pay.

syndrome777 · 30-09-2018 3:14pm

Borzoi wrote: »

Yes. Because they will also insist on 30% deposit. And that the mortgage is no more than 30% of your take-home pay.

it would be great if Irish banks offered something like that

KevinCavan · 30-09-2018 8:12pm

Phantom1234 wrote: »

Any thoughts on property market in cork? Been watching for last 2 years and seems to be approaching silly territory !!

What I looked into recently was higher end houses in Cork and Dublin, (not that I can afford them). For €500,000 there are better options in Dublin and more of a selection. In general Dublin has way more choice, obviously with the bigger population. Not a whole pile of a difference between Cork and Dublin prices in my opinion. Dublin would be a better place to invest.

whatever76 · 30-09-2018 11:20pm

Phantom1234 wrote: »

Any thoughts on property market in cork? Been watching for last 2 years and seems to be approaching silly territory !!

Desired city centre areas is tough and lack of supply is pushing prises up big time - big demand for 250 - 300 k price point ( regardless of them needing work and a lot of them are not turn key ) so bidding wars inevitable. heard somewhere recently that some areas like turners cross/balleyphane houses go sale agreed within 3 weeks !

titan18 · 01-10-2018 7:42am

whatever76 wrote: »

Desired city centre areas is tough and lack of supply is pushing prises up big time - big demand for 250 - 300 k price point ( regardless of them needing work and a lot of them are not turn key ) so bidding wars inevitable. heard somewhere recently that some areas like turners cross/balleyphane houses go sale agreed within 3 weeks !

Ya, I'm seeing a good few go up around 300k and go off market quick enough. If it goes over 300k, they seem to take longer to move. Severe lack of apartments in the city centre from what I've seen too.

I'm monitoring the market atm, but probably a year or two from being in a position to buy at current prices. Hoping for a crash tbh as house prices in areas like Midleton, Carrigtwohill etc have jumped massively in the last few years.

House across the road from where I'm living atm (with parents) has gone up for sale at 340k. I'll be interested to see how fast that moves. Viewings have been slow enough from what I've seen though unless they're coming in during working hours.

Henbabani · 01-10-2018 9:12am

https://www.daft.ie/report
so many signs of moderate prices.
no one can't ignore it anymore that something good has started

lawred2 · 01-10-2018 9:16am

Henbabani wrote: »

https://www.daft.ie/report
so many signs of moderate prices.
no one can't ignore it anymore that something good has started

who is ignoring it?

The_Conductor · 01-10-2018 9:21am

Henbabani wrote: »

https://www.daft.ie/report
so many signs of moderate prices.
no one can't ignore it anymore that something good has started

Sorry- what do you mean?

Bob24 · 01-10-2018 9:50am

Borzoi wrote: »

Yes. Because they will also insist on 30% deposit. And that the mortgage is no more than 30% of your take-home pay.

The above statement doesn’t seem to be correct. I just googled it and all the websites I come accross are saying the same thing: there is no law/regulation in France with regards to minimum deposits, and in practice most banks ask for a minimum of 10%.

Just one of the links returned by google but there are many others which all say the same thing: https://www.acecredit.fr/fr/montant-minimal-apport-pret-immobilier.html

So this is not the explanation for low and fixed rates.

Bluefoam · 01-10-2018 10:29am

Just a thought... House prices are stabilising, partly due to affordability, but partly due to strict restrictions on mortgage lending. Our government obviously favour property as a growth and economic stimulator...

So, if there are signs of an iminent decline, they can loosen the lending criteria, thus releasing more buyers onto the market and stabilising the property sector... am I missing something?

Samuel T. Cogley · 01-10-2018 10:32am

Bluefoam wrote: »

Just a thought... House prices are stabilising, partly due to affordability, but partly due to strict restrictions on mortgage lending. Our government obviously favour property as a growth and economic stimulator...

So, if there are signs of an iminent decline, they can loosen the lending criteria, thus releasing more buyers onto the market and stabilising the property sector... am I missing something?

The CB rules aren't (directly) government controlled. They weren't overly happy with the seposit requirements when it all came in. Stabilisation is ecatly whats needed, inflationary gains at best in the sector not double digit growth.

They'll push house prices up with things like first time buyer grants though.

seamus · 01-10-2018 10:49am

Ulises Gifted Stoicism wrote: »

Was talking to an EA in Dublin this week who is saying things are stagnating and ready to crash.

EAs always think they have the inside tracks.

Re/Max - remember them - were absolutely annihilated in the last crash. At the peak there were 40 franchise offices in Ireland. There are now 11, and I think that's double what it was five years ago.

If agents knew anything about economics, they wouldn't have been so badly burned the last time.

This is really the one we want to watch:

Unfortunately Daft only started collating inflow/outflow stats at the start of 2007, but you can see that stock being listed on Daft at that point massively outstripped what was selling - even though selling/delisting rates stayed pretty static.

I suspect if we had earlier data, you would see similar for the latter half of 2006 - static outflow, with a higher inflow. House prices in Dublin were at 0% for the last 6 months of 2006. That was basically unheard of in the previous five years.

What does this tell us about where we are now? It indicates that we are definitely at an equilibrium point. In a normal market the amount of stock on Daft would be pretty stable, inflow and outflow matching eachother well. Remember that this isn't house sales - there are many reasons why properties delist. But supply/demand is the key and they should track eachother fairly closely.

For now, we're looking OK. But for the first time in quite a while we've seen Inflow beat Outflow more consistently. We need to watch what happens next quarter - if we see another increase in stock, inflow beating outflow, then there's a good chance were on the cusp of another house price dip (though nothing like we've seen before).

If stock remains flat or drops again slightly, then we're most likely into the stability zone, as building increases to match the demand for it.

Bob24 · 01-10-2018 11:13am

Bluefoam wrote: »

So, if there are signs of an iminent decline, they can loosen the lending criteria, thus releasing more buyers onto the market and stabilising the property sector... am I missing something?

The temptation definitly exists yes. I think direct government influence on lending rules is harder nowadays that it was in the past as the CBI which sets those rules is now fairly closely monitored by ECB. Having said that as another poster mentioned you can trust the government with being creative in terms of introducing schemes to help borrowers work around the rules.

titan18 · 01-10-2018 11:16am

Bob24 wrote: »

The temptation definitly exists yes. I think direct government influence on lending rules is harder nowadays that it was in the past as the CBI which sets those rules is now fairly closely monitored by ECB. Having said that as another poster mentioned you can trust the government with being creative in terms of introducing schemes to help borrowers work around the rules.

The Central Bank are the one good thing in all this mess. Without them, sh1t would really hit the fan when it came to house prices. Government will work whatever crap around them that they can but as long as Central Bank stay firm on what they do control, things would spiral too badly.

tigger123 · 01-10-2018 11:29am

titan18 wrote: »

The Central Bank are the one good thing in all this mess. Without them, sh1t would really hit the fan when it came to house prices. Government will work whatever crap around them that they can but as long as Central Bank stay firm on what they do control, things would spiral too badly.

In the current market of a lack of supply and bidding wars, people would, without doubt, mortgage themselves to the hilt in order to get a home.

CB rules shouldn't be moved.

whatever76 · 01-10-2018 11:41am

tigger123 wrote: »

In the current market of a lack of supply and bidding wars, people would, without doubt, mortgage themselves to the hilt in order to get a home.

CB rules shouldn't be moved.

agree totally !!! I have no data to back this up and just an observation - but 2007/2008 300K for a house was crazy money - today though 300k house is seen as good value . this is my budget and I am struggling to find somewhere as I keep getting into bidding wars or house is hitting 300k but needs major refurb …. if bank were lending me more I defo be tempted to go higher but its keeping me within my limits and just telling myself to keep saving away so build up better deposit

adriaaaan · 01-10-2018 12:01pm

Who is arguing that CB LTI rules should be changed? I have heard a lot of people mention this on this thread over the past year but I haven't seen a politician or economist say we should go 4x income or increase exemptions. The CBI and regulator has learned that lesson and Paschal Donoghue is extremely prudent

01-10-2018 12:33pm

300k was not crazy money for a house in 2006 / 2007.
Not in Dublin anyway.

whatever76 · 01-10-2018 12:39pm

bubblypop wrote: »

300k was not crazy money for a house in 2006 / 2007.
Not in Dublin anyway.

Sorry I should have clarified - was talking about Cork Suburbs

seamus · 01-10-2018 1:09pm

adriaaaan wrote: »

Who is arguing that CB LTI rules should be changed?

REA came out last week claiming that the rules "had worked" but now needed to be relaxed because they were strangling the housing market.

Of course estate agents would say that. But they got airtime, which means there are other people who would like to the rules to be relaxed.

Roger_007 · 01-10-2018 1:32pm

I am planning to move house in the next year or two. I have benn 'marking' houses on Daft for the last three months. Of the 30 or so that I had saved, I have been notified of changes in the the asking price for eight of them. In all cases the change has been downward by an average of 10%. The area I have been looking at is the Drogheda/East Meath area.
I don't know know if this is a straw in the wind or if some people were overly ambitious in their asking prices, but I will be be keeping a close eye on it over the next few months.

Borzoi · 01-10-2018 1:34pm

Bob24 wrote: »

The above statement doesn’t seem to be correct. I just googled it and all the websites I come accross are saying the same thing: there is no law/regulation in France with regards to minimum deposits, and in practice most banks ask for a minimum of 10%.

Just one of the links returned by google but there are many others which all say the same thing.

Your Google vs my French mortgage broker. Go figure

Bob24 · 01-10-2018 1:44pm

Borzoi wrote: »

Your Google vs my French mortgage broker. Go figure

As it happens the link I provided is from the website of an institutional French mortgage broker. And as I said all the multiple sources I reviewed are saying the same thing. See for exemple the same information from France’s largest property advertising website for individuals which also says 20% is a better and more comfortable deposit but 10% will be “easily” accepted for FTBs: https://www.pap.fr/acheteur/credit-immobilier/combien-emprunter-pour-financer-son-achat/a1170/evaluer-son-apport-personnel

Either your mortgage broker is misinforming you or (probably more likely) you are in a specific situation which requires a much higher deposit than the average joe. But an average French household working in France and buying their first property in France definitly won’t be asked for 30%.

And I’d rather not post too much personal information but I have a lot of first hand information from people who actually got mortgages in France and goes against that supposed 30% requirement.

Lastly and just to be clear I’m not saying imposing minimum deposits is bad, quite the opposite - but in the interest of having a fact based discussion, there is no such thing as 30% minimum deposits in France and thus this can’t be an explanation for better/fixed rates there. So to come back to the original point the explaination for better mortgage terms in France has to be something else.

Pussyhands · 01-10-2018 1:51pm

3 bed semi near me for sale for 420k in a commuter town. Place wedged with cars for open viewings the other night.

Topgear on Dave · 01-10-2018 2:31pm

seamus wrote: »

REA came out last week claiming that the rules "had worked" but now needed to be relaxed because they were strangling the housing market.

Of course estate agents would say that. But they got airtime, which means there are other people who would like to the rules to be relaxed.

The media LOVE property advertising.

The_Conductor · 01-10-2018 2:33pm

Topgear on Dave wrote: »

The media LOVE property advertising.

Of course they do- they own half the major websites- and rely on property advertising for a shedload of their cashflow in the papers themselves.

Property Market 2018

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