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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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fliball123

FVP3 wrote: »

You didn't "deal with" anything. There is no landlord tax of 51%, there is an income tax for all.

All your arguments on this thread are badly thought out.

I argued that if someone has a buy to let then they must have a job that pays a good salary as they will have had to get a deposit for 2 houses. Therefore as we know the higher rate of tax kicks in at a very low level in this country it would safe to assume that most landlords are already on the higher rate of tax or close to it and any income garnered by a rental would be or at the very least partially subject tot he higher rate of tax. So there is a tax on rental income. Even if they are not on the higher income bracket their rental income is still income and is subject to tax.

If there was no tax for landlords rental income then why did the govenment create this page on the revenue website?

https://www.revenue.ie/en/property/rental-income/irish-rental-income/how-do-you-calculate-your-taxable-income.aspx

Is this phucking coherent enough for you?

fifth

KaiserSochez wrote: »

I’m in a similar position. Wondering how you went about the negotiation? The vendor on mine was firm on their asking to begin with as I went in 5k less than asking and they came back with a no. That was a week ago. I was planning on seeing how things played out for a few weeks and maybe broaching the subject again...

So for context - it's a high end new build property and has been sitting for a few months. The last of a small development of 8 homes. I figured if I could negotiate 5-10% off the price it would fall nicely within my budget, with everything going on in the market now I thought maybe I'd chance asking.

I called the EA and asked if the vendor would consider an offer of 8% off the asking. She came back and said no deal, asked if I'd be interested in some other properties, I said no & thank you for enquiring for me. I'd sit out for a while and see how the market goes.

She called me back a couple of days later and asked if I'd be willing to up my offer on the property and I said no, I couldn't stretch to it. So she said she would "go and speak to the builder again"

This time they came back and said they would be willing to deal at a 6% discount and this was acceptable to me. I think the property is exceptional. Whole process took around 7 days with the back and forth.

Donald Trump

Villa05 wrote: »

Personally I think a windfall tax of 70/80% on land designated commercial/residential or industrial as was the case from 2009 up to 2016 as the best option

Anyone now why the current sitting Gov abolished it. Was it just their links with wealthy large farmers or was there something more important

I agree a windfall tax could be an option, but for a different reason. ONe argument against it would be that it would be a a disincentive to people from selling their land. And it also doesn't directly help anyway because it would only be when the rezoning happens. It won't prevent a developer buying for 1m an acre and sitting on it until it is at 2m an acre. The real likelihood would be that it would completely slow down the release of land for building. If I have the most suitable land for housing and you are going to tax me at 80 if I realise the capital gain....I might just hold onto it until you reduce that tax! In order for you to incentivise me to use it, you have to have a recurring charge

By and large it is not "wealthy large farmers" who are getting those windfalls. It is developers. Some farmers do get their land away for building but they usually wouldn't be classed as otherwise wealthy. Anyone who gets such a windfall is, by definition, wealthy.

Your granny could have left you what was her cottage and 3 acres that used to be just outside the village of ballygobackward which became surrounded by estates in the last boom and sold for a million quid. Which makes you wealthy. It hardly retrospectively makes you a wealthy farmer with the government in your pocket does it?

GreeBo

Dwarf.Shortage wrote: »

People can no longer borrow as much stifling the effective demand in parts of the market these people previously inhabited.

It’s not all good though because most of them still need houses and everyone gets compressed into a smaller segment of the market.

If you look at the figures on loss of exemptions for example is going to take a lot of heat out of the 375-450 segment that the 4.5x people were reaching into but they’re just forced back into the already crowded 300-375 space.

I dont think its good at all, which is why Im questioning it.
There is a lower bound in all this, the price it costs a builder to build a house and still make enough profit for it to be worthwhile.

Making it harder for people to afford a house just pushed more people down into the lower priced houses and so increases demand there.
Those same people how get forced into a lower band have, by definition, more money than those who were already there, so the people with less money are more impacted.

But it was his idea, so I will wait for him to explain...

FVP3

JimmyVik wrote: »

Never argue with a non economist who fancies himself as an economist.
Pissing into the wind there.

Who knows who is an economist or not here, or whether we should take every economic theory seriously anyway.

JimmyVik wrote: »

Everybody always wants to tax someone else for their own benefit.
Usually when you see someone spouting about taxing something or someone, you will find that its for their personal gain and of course they wont be the ones taxed with their suggestion.

Best ignored tbh

Obviously people don't want to tax themselves over much, but given that workers pay 51% marginal, they clearly would be interested in other groups stepping up to the plate. And any tax can be debated on its merits or not.

FVP3

old_house wrote: »

...after having diminished the value before by restricting the possible uses. Government doesn't give value to anything, it just extracts value.

Surely you are not advocating a free for all with no land zoning.

And of course government adds value, although any farmer and landowner is welcome to build their own roads and train-lines if they wish and can fund it. An unaccessible land would be worth nothing.

Land has been traded long before "authorities" introduced formal rules and taxes.

Whenever land was traded there was come kind of government or legal system guaranteeing legal ownership. Otherwise land wasn't traded it was taken by the guys with the biggest armies.

I'm not necessarily against measures to make development land more affordable where needed, but that argument doesn't cut it.
Does anyone remember the development land windfall tax we had after the last recession? Did it work? Did it make housing cheaper? There must be data on this somewhere.

It was removed ( by Noonan, natch), but isnt what we I am asking for. This isnt a land tax.

https://www.irishtimes.com/business/commercial-property/government-to-axe-80-development-land-windfall-tax-1.1963043

Villa05

Personally I think a windfall tax of 70/80% on land designated commercial/residential or industrial as was the case from 2009 up to 2016 as the best option

Anyone now why the current sitting Gov abolished it. Was it just their links with wealthy large farmers or was there something more important

JimmyVik

eagle eye wrote: »

Why not close down every gym and turn them into apartments, what about soccer stadiums. We could get rid of two from Shels, St Pat's and Bohs and they all play in the one stadium? How about we get rid of Croke Park and move all major gaa matches to somewhere in the middle of the country which makes it easier for everybody to travel?
What about all the Phoenix park, close it and open a new park in ballygobackwards?
Why are you talking about golf courses. It's a good healthy activity with lots of paid up members. It's not costing the state anything. The others I mention are all getting state money in one form or another.

Never argue with a non economist who fancies himself as an economist.
Pissing into the wind there.

voluntary

KaiserSochez wrote: »

I’m in a similar position. Wondering how you went about the negotiation? The vendor on mine was firm on their asking to begin with as I went in 5k less than asking and they came back with a no. That was a week ago. I was planning on seeing how things played out for a few weeks and maybe broaching the subject again...

Unless you're desperate just walks away, keep searching and this one may cormay not come back to you. Desperate people hardly ever get good deals.

eagle eye

ittakestwo wrote:

Miltown golf club has the luas line beside it. You could also cycle into town within 10/15 mins. It's a perfect place to put a high density housing similar to Dun Laoghaire golf club.

Why not close down every gym and turn them into apartments, what about soccer stadiums. We could get rid of two from Shels, St Pat's and Bohs and they all play in the one stadium? How about we get rid of Croke Park and move all major gaa matches to somewhere in the middle of the country which makes it easier for everybody to travel?
What about all the Phoenix park, close it and open a new park in ballygobackwards?
Why are you talking about golf courses. It's a good healthy activity with lots of paid up members. It's not costing the state anything. The others I mention are all getting state money in one form or another.

Dwarf.Shortage

GreeBo wrote: »

Unless I have missed it, you havent explained how a 20 year mortgage makes houses cheaper.

People can no longer borrow as much stifling the effective demand in parts of the market these people previously inhabited.

It’s not all good though because most of them still need houses and everyone gets compressed into a smaller segment of the market.

If you look at the figures on loss of exemptions for example is going to take a lot of heat out of the 375-450 segment that the 4.5x people were reaching into but they’re just forced back into the already crowded 300-375 space.

GreeBo

lomb wrote: »

All these arguments are false. Property is in many cases cheaper than the rebuild cost. Ergo land has a zero value in many cases.

In my experience the rebuild costs is significantly cheaper than the property cost. Ergo land is very expensive in many cases.

Donald Trump

Pablo_Flox wrote: »

I strongly agree.

Im paying 1,600 per month for a 1 bedroom apartment. If I was to delay purchasing a property for 2 years the price of a property would have to drop by 38k+ for me to break even; and if Im going to hold off I have no interest in breaking even, I want to improve on that. I would want the property to drop by at least 70k for it to have been a worthwhile gamble for me. I can not see properties dropping by that much - and even if they do I would expect most house's brought to the market to be the dregs of the barrel. Why would someone sell at a market low if they have even the slightest choice in the matter.

So its full steam ahead for me.

Will you be getting a mortgage?

If so, be aware that if you pay off 1600 a month on that mortgage, you won't have paid off 38k of the capital outstanding within 2 years.

Hubertj

lomb wrote: »

All these arguments are false. Property is in many cases cheaper than the rebuild cost. Ergo land has a zero value in many cases.

can you flesh this out a bit as i don't follow so don't know if i agree or disagree.

I understand that property can be cheaper than the rebuild cost but why does that mean land has 0 value?

KaiserSochez

fifth wrote: »

I am in the same boat.

After much to-ing and fro-ing in recent weeks about holding off..I've decided to continue with my purchase. I was hoping for a bigger discount, but have negotiated 6% and I'm content with that. It's either that or face renting for another year or two and hope supply of new builds picks up.

I’m in a similar position. Wondering how you went about the negotiation? The vendor on mine was firm on their asking to begin with as I went in 5k less than asking and they came back with a no. That was a week ago. I was planning on seeing how things played out for a few weeks and maybe broaching the subject again...

fifth

Pablo_Flox wrote: »

I strongly agree.

Im paying 1,600 per month for a 1 bedroom apartment. If I was to delay purchasing a property for 2 years the price of a property would have to drop by 38k+ for me to break even; and if Im going to hold off I have no interest in breaking even, I want to improve on that. I would want the property to drop by at least 70k for it to have been a wothwile gamble for me. I can not see properties dropping by that much - and even if they do I would expect most house's brought to the market to be the dregs of the barrel. Why would someone sell at a market low if they have even the slightest choie in the matter.

Do its full steam ahead for me.

I am in the same boat.

After much to-ing and fro-ing in recent weeks about holding off..I've decided to continue with my purchase. I was hoping for a bigger discount, but have negotiated 6% and I'm content with that. It's either that or face renting for another year or two and hope supply of new builds picks up.

Donald Trump

Villa05 wrote: »

Agreed
Only the state can issue a CPO, a CPO would not be issued unless there was a relatively immediate need, state takes ownership and either contracts out development or get existing resources to do it

Tell that to Thomas Reid. He had to go to the High Court.

The state already can, and does, enact CPOs under current legislation. They have done so in the past too for housing (Ballyfermot in Dublin was built on CPO'd land in the 60's or whenever)

What they want to do now is a change that necessitates modifying the constitution. That should be enough to raise alarm bells that it is different. They want to be able to take the land for private developers.

Pablo_Flox

Tallback wrote: »

I appreciate the point about potentially saving a fortune - but to achieve that it might be necessary to delay life for a couple of years at a minimum.

I strongly agree.

Im paying 1,600 per month for a 1 bedroom apartment. If I was to delay purchasing a property for 2 years the price of a property would have to drop by 38k+ for me to break even; and if Im going to hold off I have no interest in breaking even, I want to improve on that. I would want the property to drop by at least 70k for it to have been a worthwhile gamble for me. I can not see properties dropping by that much - and even if they do I would expect most house's brought to the market to be the dregs of the barrel. Why would someone sell at a market low if they have even the slightest choice in the matter.

So its full steam ahead for me.

GreeBo

FVP3 wrote: »

The same number of people will be able to buy houses as houses would be cheaper. The opposite of what happens if you increase the length of the mortgage.

(The only possible problem is builders not building at lower prices )

Unless I have missed it, you havent explained how a 20 year mortgage makes houses cheaper.

lomb

All these arguments are false. Property is in many cases cheaper than the rebuild cost. Ergo land has a zero value in many cases.

GreeBo

Villa05 wrote: »

I suggest that you read my post before responding. The article posted answers all your questions, and gives clues as to why it has not happened to date

I never mentioned golf course or stadia nor did I compare anything to Singapore

Singapore is dominated by high rise, low cost, heavily sibsdized and income restricted, small apartments.

Explain how that helps a housing problem in Ireland?

old_house

FVP3 wrote: »

Its a government or local government decision that makes the land valuable to begin with by rezoning it.

...after having diminished the value before by restricting the possible uses. Government doesn't give value to anything, it just extracts value. Land has been traded long before "authorities" introduced formal rules and taxes.
I'm not necessarily against measures to make development land more affordable where needed, but that argument doesn't cut it.
Does anyone remember the development land windfall tax we had after the last recession? Did it work? Did it make housing cheaper? There must be data on this somewhere.

ittakestwo

GreeBo wrote: »

Firstly we don't have the infrastructure to get more people from the likes of Milltown into town.
Secondly, as I said earlier, how much do you reckon any home built on a golf course in your suggested locations is going to cost?

Remind me how much those houses in Dun Laoghaire cost?
The cheapest I cant find in Cualanor is a 1 bed apartment for €330,000.
With prices over 800K for others.

Miltown golf club has the luas line beside it. You could also cycle into town within 10/15 mins. It's a perfect place to put a high density housing similar to Dun Laoghaire golf club.

They would be expensive given the location but it would have an effect on the whole market as the people buying/living there would not have to go somewhere else.

Ever at the end of a very long que for a supermarket checkout, then they open another till. Will only the people at the top of the que benefit from the extra till being opened?

Villa05

Donald Trump wrote:

All you are simply doing is grabbing the land and handing it over to developers. Developers are already sitting on land and not developing it.

Donald Trump wrote:

No. This in no way solves any problem.

Agreed
Only the state can issue a CPO, a CPO would not be issued unless there was a relatively immediate need, state takes ownership and either contracts out development or get existing resources to do it

FVP3

Donald Trump wrote: »

No. This in no way solves any problem.

All you are simply doing is grabbing the land and handing it over to developers. Developers are already sitting on land and not developing it.

Most land which has any significant hope value is not in the hands of farmers. You should realise this. The land you see at the edges of big towns is already owned by developers. They may rent it out to farmers to use it but a lot is landbanked.

In talking about seizing agricultural land, they are talking about going out another step and allowing the developers to cheaply bank up the next layer of land. It will have no impact on the already developer-owned layer encircling those towns.

Do it at the source. Force the developers to develop what they have. This will in turn bring down prices along the chain. The price the end consumer has to pay and the price paid to the farmer. Allowing the land grab only facilitates the middle man (the developer) to seize it for cheap. He can then continue to sit on it for as long as he wants the same as he does now anyway............Even longer as he got it for cheap.......

Yeh I agree with that. A land tax on undeveloped land would help, something that could be adjusted in recessions and booms etc.

FVP3

cnocbui wrote: »

They can do that, and while they are at it, might as well cap salaries and the price of cars and the price of clothes, and food and childcare and bring in 5 year economic plans and call the country the Union of Socialist Irish Counties.

Good of the country, my arse.

Thats literally a slippery slope argument. Literally.

Classical economists believe in land value taxes, which would also reduce the price of land. Its a government or local government decision that makes the land valuable to begin with by rezoning it.

FVP3

fliball123 wrote: »

I have dealt with your notion of taxes for landlords in a previous post and that it is a reasonable assumption the majority of landlords (non REITS or vultures) are paying 51% tax on rental profits.

You didn't "deal with" anything. There is no landlord tax of 51%, there is an income tax for all.

All your arguments on this thread are badly thought out.

JimmyVik

Dwarf.Shortage wrote: »

I agree but it's important to take a holistic view of what it does to their operation. It's all well and good saying we need 4 acres for a public project, market value is €40k here's €50k.

But if losing that 4 acres splits their land in two or in some other way compromises and makes much more difficult the running of their farm they need to be compensated for that too.

Good point.

If someone offered my father 1.25% the value of the field at the end of the garden he would take the hand off them. My mother , however would never allow it.

Some people have more than a financial attachment to something.

Donald Trump

Villa05 wrote: »

Offering a farmer market value + 25% for their land is hardly a punitive measure

No. This in no way solves any problem.

All you are simply doing is grabbing the land and handing it over to developers. Developers are already sitting on land and not developing it.

Most land which has any significant hope value is not in the hands of farmers. You should realise this. The land you see at the edges of big towns is already owned by developers. They may rent it out to farmers to use it but a lot is landbanked.

In talking about seizing agricultural land, they are talking about going out another step and allowing the developers to cheaply bank up the next layer of land. It will have no impact on the already developer-owned layer encircling those towns.

Do it at the source. Force the developers to develop what they have. This will in turn bring down prices along the chain. The price the end consumer has to pay and the price paid to the farmer. Allowing the land grab only facilitates the middle man (the developer) to seize it for cheap. He can then continue to sit on it for as long as he wants the same as he does now anyway............Even longer as he got it for cheap.......

Villa05

fliball123 wrote:

Also by your inefficiency analogy every single or double story house in the country should be knocked down and rebuilt with 20 stories up and you can get your space back but with a couple of hundred people living on top. We are all about efficiency after all.

We will have to agree to disagree, I think