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Property Market 2020

Bigmac1euro

Maybe an article for “Property Market 2020”
Anyhow looks like developers are going to start strangling supply in order to keep prices in check.

Worth a read anyway.

https://www.independent.ie/business/personal-finance/property-mortgages/developers-now-fear-flooding-market-as-house-prices-in-decline-38820967.html

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Zenify

cnocbui wrote: »

I would hope to be selling my property in the near future. I don't 'need' to sell it and would sooner rent it out and wait till the market comes to it's senses, rather than sell at a loss or poor price. Anyone who panics with an asset as valuable as property is very foolish.

Doubt you will get current prices in the 'near future'

Mic 1972

sweetie wrote: »

Do we really need these type of tourists. Eating in mcDs, staying in AirBnb, spending feck all in the economy.

I'd say you need all sort of tourists, Dublin is not exactly Dubai
People who look for cheap holiday will still spend money

Idbatterim

Mic 1972 wrote: »

I'd say you need all sort of tourists, Dublin is not exactly Dubai
People who look for cheap holiday will still spend money

a cheap holiday in Ireland?!

Idbatterim

cnocbui wrote: »

I would hope to be selling my property in the near future. I don't 'need' to sell it and would sooner rent it out and wait till the market comes to it's senses, rather than sell at a loss or poor price. Anyone who panics with an asset as valuable as property is very foolish.

coming to its senses in my mind, would be a drop, certainly on the rents and also on the sale price...

randoplh134

Sheeps wrote: »

This guy telling people to sell their property now, and also for people not to buy property now. You couldn't make it up.

Are both of you working off the same MO or did you forget to sign out of your account when posting.

Read my post you are replying to, i said those who NEED to sell should do now and stomach a small loss before they lose their shirt if they decided to wait a few months in hopes of the some recovery.

I stated beforehand that the vast majority of people should not buy now yes you are correct but by that same token i have also stated that the rare few who have a substantial deposit ( basically majority cash buyers ) and are buying a property for the long term (>20 years ) should buy now if they really want the property and if the deal is right for them.

Don't form a bias off the last page on a huge thread, it's sheer laziness, either that or you are knitpicking/borderline trolling. like the other poster

Mic 1972

Donald Trump wrote: »

Strange then that over the past week there appears to have been a noticeable increase of properties available at lower rents.....and a lot of them appear to have been, up until recently, let out on a short term basis.... (furnished and bills included etc)

Mad that.

Nothing strange at all, ariBnB houses are becoming available to the market due to holiday industry being affected by current virus

Still, the housing crisis wasn't caused by ariBnB, that's a very simplistic statement

Mic 1972

Idbatterim wrote: »

a cheap holiday in Ireland?!

exactly, cheap tourists will go to a hostel and even then they'll get robbed

Donald Trump

Mic 1972 wrote: »

Nothing strange at all, ariBnB houses are becoming available to the market due to holiday industry being affected by current virus

Still, the housing crisis wasn't caused by ariBnB, that's a very simplistic statement

The tone of the post I was replying to appeared to give the impression that you though that the removal of property from the rental market, due to it being moved to short-term holiday rentals, was not a factor in the current high prices in the rental market.

My response to that is that as soon as those properties come back into the rental market, it looks like rents are dropping. Granted it might be a very short term blip, but I think it will last for a while.

I am sure that, on average, there are a few hundred airbnb beds empty every night. But because of the premium price, it is still worth the owners while to leave them empty rather than let long term. This decreases market supply. One house brought back to the market is the same as one house built and added to the market.

coolshannagh28

randoplh134 wrote: »

Are both of you working off the same MO or did you forget to sign out of your account when posting.

Read my post you are replying to, i said those who NEED to sell should do now and stomach a small loss before they lose their shirt if they decided to wait a few months in hopes of the some recovery.

I stated beforehand that the vast majority of people should not buy now yes you are correct but by that same token i have also stated that the rare few who have a substantial deposit ( basically majority cash buyers ) and are buying a property for the long term (>20 years ) should buy now if they really want the property and if the deal is right for them.

Don't form a bias off the last page on a huge thread, it's sheer laziness, either that or you are knitpicking/borderline trolling. like the other poster

This is accurate , my sister has a house for sale at the minute and there is no interest in it at the minute and she is starting to panic and would accept a reduced offer if she could get one ; unknown unknowns etc.

cnocbui

Idbatterim wrote: »

coming to its senses in my mind, would be a drop, certainly on the rents and also on the sale price...

Your idea of 'sense' is for houses to sell at below construction cost? Expect the Irish moan of 'not enough houses available/being built' to have an infinite duration, if that is what you really think.

€330,000 is the average cost of building a three bedroom semi-detached house in Greater Dublin, according to a study published by the Society of Chartered Surveyors Ireland (SCSI).

The report entitled The Real Cost of New House Delivery 2016 found that the cost of building a new house come in at €45k higher than the average asking price of a similar house in Dublin.

https://www.newstalk.com/news/heres-how-much-it-costs-to-build-a-house-597037

Assetbacked

sweetie wrote: »

Do we really need these type of tourists. Eating in mcDs, staying in AirBnb, spending feck all in the economy.

Sitting around a table of half pints of Guinness and Smiwthwicks for an hour. No thanks.

Mic 1972

cnocbui wrote: »

Your idea of 'sense' is for houses to sell at below construction cost? Expect the Irish moan of 'not enough houses available/being built' to have an infinite duration, if that is what you really think.

https://www.newstalk.com/news/heres-how-much-it-costs-to-build-a-house-597037

Selling price is dictated by the market, unfortunately for the builder it may not always exceeds the cost of building

Mic 1972

Assetbacked wrote: »

Sitting around a table of half pints of Guinness and Smiwthwicks for an hour. No thanks.

What does Dublin offer to make tourists want to spend a lot of money? most of my friends who came visit me only stayed in Dublin for 1/2 nights and then traveled around

lcwill

voluntary wrote: »

Just a note on rent to purchase cost ratios. The rents in Ireland are and were enormous. If rents would to drop by 30-40% and house prices remain at the current level, this would still make an investment in BTL attractive.

If you could recently purchase an apartment for 240.000 and rent it for 2000 per month (24k annually) the puts a purchase price of 10 annual rents which is normally considered as very low. A ratio of 15 would be an average and a ratio of 20 would indicate properties too expensive in comparison to rents.

I believe rents are going to fall much faster than house prices.

Rents won't fall unless the government removes the RPZ restrictions. Landlords will be very reluctant to accept a lower rent if they never know when they will be able to increase it again - and it has a direct impact on the value of their property (lots of daft ads now have the current rent indicated in them, or say they are not subject to restrictions).

cnocbui

Mic 1972 wrote: »

Selling price is dictated by the market, unfortunately for the builder it may not always exceeds the cost of building

Only in the very short term. If the market price is below the construction cost, no houses will be built. Supply will soon become scarce to non-existent until such time market demand rises to at least meet the real market cost of providing housing.

Initially there will be distressed sales, but I suspect most these will soon be snapped up cashed up investors, as happened after the GFC. https://www.thejournal.ie/45-of-all-properties-bought-with-cash-or-savings-in-2018-4498981-Feb2019/

The supposed housing shortage in Dublin would appear to be perpetually insoluble.

Brianmwalker

cnocbui wrote: »

Only in the very short term. If the market price is below the construction cost, no houses will be built. Supply will soon become scarce to non-existent until such time market demand rises to at least meet the real market cost of providing housing.

Initially there will be distressed sales, but I suspect most these will soon be snapped up cashed up investors, as happened after the GFC. https://www.thejournal.ie/45-of-all-properties-bought-with-cash-or-savings-in-2018-4498981-Feb2019/

Do you not think cost of building can come down? Wages drop? Price of materials drop? Site price drops?

Mic 1972

cnocbui wrote: »

Only in the very short term. If the market price is below the construction cost, no houses will be built. Supply will soon become scarce to non-existent until such time market demand rises to at least meet the real market cost of providing housing.

Initially there will be distressed sales, but I suspect most these will soon be snapped up cashed up investors, as happened after the GFC. https://www.thejournal.ie/45-of-all-properties-bought-with-cash-or-savings-in-2018-4498981-Feb2019/

The supposed housing shortage in Dublin would appear to be perpetually insoluble.

Construction will surely slow down and then stop until prices recover. But there are going to be a lot of second hand houses coming up, if things get really bad here - like in italy - sadly a lot of old people will be gone in a matter of weeks

smurgen

lcwill wrote: »

Rents won't fall unless the government removes the RPZ restrictions. Landlords will be very reluctant to accept a lower rent if they never know when they will be able to increase it again - and it has a direct impact on the value of their property (lots of daft ads now have the current rent indicated in them, or say they are not subject to restrictions).

Course they will. They won't be able to increase for years yet. We're now in a reverse of the last ten years.landlords are price takers now.

smurgen

cnocbui wrote: »

Only in the very short term. If the market price is below the construction cost, no houses will be built. Supply will soon become scarce to non-existent until such time market demand rises to at least meet the real market cost of providing housing.

Initially there will be distressed sales, but I suspect most these will soon be snapped up cashed up investors, as happened after the GFC. https://www.thejournal.ie/45-of-all-properties-bought-with-cash-or-savings-in-2018-4498981-Feb2019/

The supposed housing shortage in Dublin would appear to be perpetually insoluble.

There's about to be a global recession. Labor costs and inputs will be cheaper. The cost of construction will be cheaper.

smurgen

cnocbui wrote: »

Only in the very short term. If the market price is below the construction cost, no houses will be built. Supply will soon become scarce to non-existent until such time market demand rises to at least meet the real market cost of providing housing.

Initially there will be distressed sales, but I suspect most these will soon be snapped up cashed up investors, as happened after the GFC. https://www.thejournal.ie/45-of-all-properties-bought-with-cash-or-savings-in-2018-4498981-Feb2019/

The supposed housing shortage in Dublin would appear to be perpetually insoluble.

There's about to be a global recession. Labor costs and inputs will be cheaper. The cost of construction will be cheaper.

Ursabear

Mic 1972 wrote: »

Nothing strange at all, ariBnB houses are becoming available to the market due to holiday industry being affected by current virus

Still, the housing crisis wasn't caused by ariBnB, that's a very simplistic statement

Air BnB most certainly added to the shortage in long term rental accomadation , adding massively to the rental crisis. There is a lot of evidence that these commercial let's which is what they are didn't all contribute to the taxes that they should have . Also by tourists renting these this meant it stifled the growth of real BnBs and hotels thus causing there to be less jobs created for people in the tourism industry. Also I believe there's the issue of capital gains tax that should apply for properties used as air b n Bs that are later sold. As well as the awful situation that neighbours are put in , particularly in apartment buildings , when other neighbours use their apartments for Air BnBs .

Donald Trump

cnocbui wrote: »

Your idea of 'sense' is for houses to sell at below construction cost? Expect the Irish moan of 'not enough houses available/being built' to have an infinite duration, if that is what you really think.

https://www.newstalk.com/news/heres-how-much-it-costs-to-build-a-house-597037

What is included in that 330k?
One would have to imagine that that include land costs. That is a sunk cost. It is wrong to include it in the building costs.

Edit. I clicked on the link. Simple enough. Construction cost of 150k.

OwlsZat

cnocbui wrote: »

Only in the very short term. If the market price is below the construction cost, no houses will be built. Supply will soon become scarce to non-existent until such time market demand rises to at least meet the real market cost of providing housing.

Initially there will be distressed sales, but I suspect most these will soon be snapped up cashed up investors, as happened after the GFC. https://www.thejournal.ie/45-of-all-properties-bought-with-cash-or-savings-in-2018-4498981-Feb2019/

The supposed housing shortage in Dublin would appear to be perpetually insoluble.

It could become in the national interest to build houses, the state already takes a third of the money. To provide jobs who have lost them and make money for the state.

The Belly

OwlsZat wrote: »

It could become in the national interest to build houses, the state already takes a third of the money. To provide jobs who have lost them and make money for the state.

Its the only way out of it in the long term. The land is there.

Borrow the money to build them and provide mortgages the same as trackers 1% above the ECB borrowing rate.

Mix developments of renters and owners to suit the demograpics and locations with the necessary services and amenites built to support them.

Tender the construction out to reliable developers with a proven track record with fixed contracts and penalties for non completion.

None of the messing that went on with the NCH.

Let the banks compete then. Most retail personal banking is online anyway. The 1% can go towards the National pension reserve fund and build that up then use that for ongoing house contruction.

Borrow the money for a very large program as proof that the money is there and ready to go. Governments can borrow the cheapest money in most cases and its never been cheaper.

Ring fence it with legislation so it cant be dipped into which they should have done with the Pension reserve fund.

It would also a create massive stimulus for the country and solve the housing crisis once and for all although it would take a bit of time.

Tradesmen just might come home if they know they have guaranteed work for the future plus they are building the houses they themselves may be living in.

People can do what they prefer then. Buy a house in the national government scheme or buy on the private market.

FernandoTorres

lcwill wrote: »

Rents won't fall unless the government removes the RPZ restrictions. Landlords will be very reluctant to accept a lower rent if they never know when they will be able to increase it again - and it has a direct impact on the value of their property (lots of daft ads now have the current rent indicated in them, or say they are not subject to restrictions).

You make it sound like it's a choice for the landlord to reduce the rent. We're in the middle of an economic crash, landlords will have absolutely no say in where prices go. A wave of supply has already hit the market in the last few weeks so I can't see tenants rushing to renew their overpriced leases. For the landlord it'll be a choice of accepting lower rent or risking it in the open market against a huge amount of competition. The whole market has been turned on it's head.

[Deleted User]

I was a landlord in the recession...... Rent dropped and there was nothing I could do. The market speaks, landlords and renters follow it. Supply & demand.
And in 2007 etc rents weren't loony high to begin with.

cudsy1

a big thank you to all the posters on here - ive found it an invaluable perhaps singular resource for opinion and information.

i havent seen any mention of brexit here since the crisis hit - does anyone think that might affect the property market over the next 6-18 months?

FAILSAFE 00

cudsy1 wrote: »

a big thank you to all the posters on here - ive found it an invaluable perhaps singular resource for opinion and information.

i havent seen any mention of brexit here since the crisis hit - does anyone think that might affect the property market over the next 6-18 months?

I doubt we will hear about Brexit for a very long time.

voluntary

My personal opinion is that property prices will get hit, but there was no big bubble in the 'affordable' segment in range of 200-300k 2/3 bed homes, therefore the drop may be limited. There's however a huge bubble in the rental sector. A bubble ready to burst. If 2 bedroom homes went up from 1000 to 1800-2000 EUR per month in just 4 years period then this is nothing else but a bubble. 40% - 50% reduction in rents is on cards.

In regards to brexit - it seems nearly irrelevant right now while countries move into lock downs. Is EU still The EU while countries are reinstating hard borders?

JJJackal

lcwill wrote: »

Rents won't fall unless the government removes the RPZ restrictions. Landlords will be very reluctant to accept a lower rent if they never know when they will be able to increase it again - and it has a direct impact on the value of their property (lots of daft ads now have the current rent indicated in them, or say they are not subject to restrictions).

Its worth noting a lot of landlords with longterm tenants have below market rents already - they will not be reducing rents or offering reduced rates