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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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Claw Hammer

Dwarf.Shortage wrote: »

As I said in a previous post this is completely untrue, there are no truly private golf clubs in Ireland. From Milltown all the way up to Adare Manor a member of the public can play them having paid the requisite green fee. The only reason walking on them is trespassing is if you are not a member and/or haven't paid a green fee you're not insured if struck by a golf ball.

They are no different to the Botanic Gardens or any other space that requires a lot of maintenance and hence has to charge for their use. This idea that someone from Milltown who's not a member cannot use the golf course is completely incorrect.

There is no right to insist on paying a green fee. The members retain the right to refuse to admit anyone should they so desire.

Dwarf.Shortage

Claw Hammer wrote: »

There is no right to insist on paying a green fee. The members retain the right to refuse to admit anyone should they so desire.

Doesn't happen in practice though does it.

You can book a tee time online and rock up with your clubs and tee off, anyone with a debit card can play the golf course for €40/€50 it's publicly available.

ittakestwo

Dwarf.Shortage wrote: »

This idea that someone from Milltown who's not a member cannot use the golf course is completely incorrect.

Attached is a sign on the Miltown gate

Summer2020

People thinking they’ll pick up a bargain are going to be disappointed I think. Two out of three properties I was bidding on previously have been taken down off the market. They can afford to sit it out and wait a few years rather than accept low ball offers of asking -10% or so.

Graham

Mod Note

Woohooo, a post discussing the property market

Ursabear

Thank you Graham! On newstalk today they were having a discussion about 75% more rental units added to the market, I know this has been discussed already in terms of air BnB but it really shows how affecting it was. I do hope that it will be better regulated should it ever return. I thought the interview with Rory Hearne was interesting https://www.newstalk.com/podcasts/highlights-from-lunchtime-live/75-increase-number-homes-rent-dublin-city

GreeBo

Personally I think there are enough people with money and REITs to eat up a large percentage of discount properties which will prevent the major drop people are expecting.

Maitguel

Graham wrote: »

Mod Note

Woohooo, a post discussing the property market

Paddy Power should do a fan denial of this thread!

JP100

I'd say they'll be an initial backlog of house builds that will need to be finished and cleared first when things start to somewhat get back to normal. After that for anyone hoping to build and approaching builders, they should be trying to drive a hard bargain with such builders. I just can't see builders been out the door with work for the foreseeable future.

Graham

Mod Note

Some off topic posts deleted.

Feel free to start a separate thread discussing the redevelopment of golf courses.

JP100

Summer2020 wrote: »

People thinking they’ll pick up a bargain are going to be disappointed I think. Two out of three properties I was bidding on previously have been taken down off the market. They can afford to sit it out and wait a few years rather than accept low ball offers of asking -10% or so.

You are taking one example and applying it universally. They will be some who will able to sit it out but they will also be some who will not.

Claw Hammer

JP100 wrote: »

You are taking one example and applying it universally. They will be some who will able to sit it out but they will also be some who will not.

There will always be some property which has to be sold. Court ordered sales following divorces or separations, executor sales and bank/receiver sales. These will establish market value for trader uppers, downsizers, investors and first time purchasers.

kevinc565

Summer2020 wrote: »

People thinking they’ll pick up a bargain are going to be disappointed I think. Two out of three properties I was bidding on previously have been taken down off the market. They can afford to sit it out and wait a few years rather than accept low ball offers of asking -10% or so.

I agree, but personally don't think -10% is low ball in this market. Problem is the whole market has ceased up. You won't sell if you can't buy ( unless it's an executor sale) so the market will be in the doldrums for 1-2 years.

0gac3yjefb5sv7

kevinc565 wrote: »

I agree, but personally don't think -10% is low ball in this market. Problem is the whole market has ceased up. You won't sell if you can't buy ( unless it's an executor sale) so the market will be in the doldrums for 1-2 years.

The place I am sale agreed on, they wouldn't give a 1k discount nevermind 10pc. They'd pull the sale immediately.

Knex*

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.

That's not a complete way of looking at it, I think? Might not make a massive difference, but you need to factor in the mortgage repayments and interest of the house prices over the 30 years.

House price now is 420,000.
Mortgage of 378,000 @ 3.15% over 30 years.
Monthly repayments: €1,624.41
Total mortgage: €584,785.95

House price reduces 5%, say, and is €399,000.
Mortgage is now €359,100 over 30 years.
Monthly repayments €1,543.19
Total mortgage: €555,546.65

Total savings: 29,239.30.

So you're saving an extra 10k over the 30 years, not just the 20k drop in price. Now, you may be comfortable writing that extra 10k off over the course of 30 years, but the previous figure you gave with regards to breaking even isn't entirely accurate.

old_house

FVP3 wrote: »

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

No, I'm most certainly not. I'm just saying that you can't just argue that the government creates value by permitting something and at the same ignore that it was the same government (figuratively) who outlawed the same thing earlier. I don't create value by stealing your bike and then giving it back.

FVP3 wrote: »

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.

I'm not sure you are being serious here, but I will bite: "Who will build the roads?" is one of the most controversial libertarian topics and the function of the state is by no means as clear as it may seem to you. I will not digress here, but if this question really bothers you then you can find a lot of literature to give you food for thought.
And: basically all land was inaccessible at some point (and much is to this day), but does that really make it worthless?

FVP3 wrote: »

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.

Yes, that is certainly true. But: over long periods of humanity it wasn't uncommon for governments to actively steal other peoples property (Germany and the jews come to mind), so government in itself is not a guarantee that you will not be robbed of your possessions. Secondly: A register of ownership that can not be altered or manipulated can be created without a central power structure. There are for instance blockchain-projects to allow small scale landowners in third-world countries to register their holdings in a safe and decentralized way and gain proof of their status. That alone doesn't protect you from nefarious activity by the state or otherwise, but at least such activity becomes transparent. See here: https://www.undp.org/content/undp/en/home/blog/2018/Using-blockchain-to-make-land-registry-more-reliable-in-India.html

FVP3 wrote: »

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

Thanks, I didn't follow that. I remember now.

[Deleted User]

Summer2020 wrote: »

People thinking they’ll pick up a bargain are going to be disappointed I think. Two out of three properties I was bidding on previously have been taken down off the market. They can afford to sit it out and wait a few years rather than accept low ball offers of asking -10% or so.

For now, how long are they willing to wait. Many people will need to sell the pool of perspective buyers will be lower. Prices will drop.

A lot of people were in denial back in 08 too. Prices didn't bottom out for 3 or 4 years and I'm not sure they have ever reached 07 levels yet.

hometruths

Summer2020 wrote: »

People thinking they’ll pick up a bargain are going to be disappointed I think. Two out of three properties I was bidding on previously have been taken down off the market. They can afford to sit it out and wait a few years rather than accept low ball offers of asking -10% or so.

you've got to wonder what these peoples plans were for after they sold their house.

Presumably in most cases it is to buy another one.

And presumably in most cases if they think the sale price of their current house is going to fall, then surely they also think the purchase price of their new house will fall too.

Why sit it out and wait a few years if the net result will be broadly similiar? Seems counterintuitive.

And we have people on here saying demand won't be hit too badly because FTBers won't wait now because it is putting their life on hold, but supply will dry up because trader uppers/downers/relocators will put their life on hold.

Doesn't make any sense to me.

GreeBo

Knex. wrote: »

That's not a complete way of looking at it, I think? Might not make a massive difference, but you need to factor in the mortgage repayments and interest of the house prices over the 30 years.

House price now is 420,000.
Mortgage of 378,000 @ 3.15% over 30 years.
Monthly repayments: €1,624.41
Total mortgage: €584,785.95

House price reduces 5%, say, and is €399,000.
Mortgage is now €359,100 over 30 years.
Monthly repayments €1,543.19
Total mortgage: €555,546.65

Total savings: 29,239.30.

So you're saving an extra 10k over the 30 years, not just the 20k drop in price. Now, you may be comfortable writing that extra 10k off over the course of 30 years, but the previous figure you gave with regards to breaking even isn't entirely accurate.

but if you are including the mortgage repayments you also have to include the portion of the asset you now own.
e.g. 5 years of payments on a 25 year house, you effectively own 20% of the house. compared to owning nothing if still renting.

GreeBo

schmittel wrote: »

you've got to wonder what these peoples plans were for after they sold their house.

Presumably in most cases it is to buy another one.

And presumably in most cases if they think the sale price of their current house is going to fall, then surely they also think the purchase price of their new house will fall too.

Why sit it out and wait a few years if the net result will be broadly similiar? Seems counterintuitive.

And we have people on here saying demand won't be hit too badly because FTBers won't wait now because it is putting their life on hold, but supply will dry up because trader uppers/downers/relocators will put their life on hold.

Doesn't make any sense to me.

all things being equal (which they rarely are) a person trading up stands to save money but selling + buying now whereas someone trading down will lose more.

Hubertj

schmittel wrote: »

you've got to wonder what these peoples plans were for after they sold their house.

Presumably in most cases it is to buy another one.

And presumably in most cases if they think the sale price of their current house is going to fall, then surely they also think the purchase price of their new house will fall too.

Why sit it out and wait a few years if the net result will be broadly similiar? Seems counterintuitive.

And we have people on here saying demand won't be hit too badly because FTBers won't wait now because it is putting their life on hold, but supply will dry up because trader uppers/downers/relocators will put their life on hold.

Doesn't make any sense to me.

Uncertainty in any industry makes people / companies pause and take stock. Whatever buying or selling strategy you might have for anything can’t have factored in a global pandemic.

smurgen

GreeBo wrote: »

but if you are including the mortgage repayments you also have to include the portion of the asset you now own.
e.g. 5 years of payments on a 25 year house, you effectively own 20% of the house. compared to owning nothing if still renting.

And if the asset continued to drop in value while your rent became cheaper?

GreeBo

schmittel wrote: »

Doesn't make any sense to me.

Everyone on here has their own financial situation thats unique to their circumstances. Every opinion is coloured by those circumstances, whether subconsciously or blatantly.

Some have spare cash and havent been impacted at all by COVID-19.
Some own their own homes outright.
Some own multiple properties outright.
Some are barely making ends meet on the property the bank owns.

Its all different and its all what drives the property market, making it much more complex than the stock market for example.

funtimes.

GreeBo

smurgen wrote: »

And if the asset continued to drop in value while you rent became cheaper?

Over the lifetime of the mortgage it wont drop (anywhere other than in Japan in 1980) and even if it did, you still own an asset at the end.

Unless you rent is a small fraction of your mortgage repayments you end up ahead if you bought rather than rented.

If you can afford to do either (buy or rent) then they only reason you would rent is flexibility or a belief that house prices are at an alltime high that will not be reached again in your lieftime.

JJJackal

Knex. wrote: »

That's not a complete way of looking at it, I think? Might not make a massive difference, but you need to factor in the mortgage repayments and interest of the house prices over the 30 years.

House price now is 420,000.
Mortgage of 378,000 @ 3.15% over 30 years.
Monthly repayments: €1,624.41
Total mortgage: €584,785.95

House price reduces 5%, say, and is €399,000.
Mortgage is now €359,100 over 30 years.
Monthly repayments €1,543.19
Total mortgage: €555,546.65

Total savings: 29,239.30.

So you're saving an extra 10k over the 30 years, not just the 20k drop in price. Now, you may be comfortable writing that extra 10k off over the course of 30 years, but the previous figure you gave with regards to breaking even isn't entirely accurate.

If you are renting you forgot to add in that cost. The rent on a 400,000 property at the moment is probably circ 1600 to 2000.

So thats about 19,000 to 24,000 per year. A realised price drop in the current market of 5% could take 1 year...

hometruths

GreeBo wrote: »

all things being equal (which they rarely are) a person trading up stands to save money but selling + buying now whereas someone trading down will lose more.

Hubertj wrote: »

Uncertainty in any industry makes people / companies pause and take stock. Whatever buying or selling strategy you might have for anything can’t have factored in a global pandemic.

I understand and agree with both of the above statements, and both make sense.

The bit I am struggling with is why would FTBers who don't have any equity built up be less price sensitive than the mover in GreeBos point?

And equally, neither cohort of buyers could have factored in the uncertainty of a global pandemic, but why would FTBers be more likely to carry on with it than the mover?

Edit to add - actually I guess the stress of completing two transactions in uncertainty rather than one might be the answer.

James 007

House prices are rising again. 7.5% in this case, its the pandemic effect taking place.

We will advertise it at this price to get our Jan asking price:P
https://www.daft.ie/dublin/houses-for-sale/drumcondra/9-fitzroy-avenue-drumcondra-dublin-2359898/

Sorry we under valued our property back then:o
https://www.irishtimes.com/life-and-style/homes-and-property/new-to-market/could-this-be-the-perfect-match-for-395k-in-drumcondra-1.4138266

Any chance of this price drop please:rolleyes:
https://thepropertypin.com/t/9-fitzroy-avenue-drumcondra-dublin-9-150k-33/23600

Paulownia

We need green space as well so we can breathe, the Guinness family has done much for Dublin, would you take their property away now?

Dylan94

Just noticed that Barnhall meadows in Lexlip increased the price of their 4 bed houses by 10k. Less than a 3% rise, but thought it was a strange time for a developer to increase prices.

https://www.myhome.ie/residential/brochure/barnhall-meadows-leixlip-co-kildare-4-bed-semi-detached/4380872

hardybuck

schmittel wrote: »

you've got to wonder what these peoples plans were for after they sold their house.

Presumably in most cases it is to buy another one.

And presumably in most cases if they think the sale price of their current house is going to fall, then surely they also think the purchase price of their new house will fall too.

Why sit it out and wait a few years if the net result will be broadly similiar? Seems counterintuitive.

And we have people on here saying demand won't be hit too badly because FTBers won't wait now because it is putting their life on hold, but supply will dry up because trader uppers/downers/relocators will put their life on hold.

Doesn't make any sense to me.

There are many people with properties they own outright that are just sitting tight for the right time to exit. They might be planning to use that to fund their retirement, nest egg for their kids, or they might just exit to any other form of investment opportunity.

There are plenty of people who are availing of cheap finance, very happy with their rent yield, and who can probably expect cheap finance for the next 3-5 years. They'll happily sit even if the rental market dips.

You also have a cohort of people going to sell sometime before end 2021 to benefit from capital gains exemptions. They'll also happily wait until next year to see how it goes.