Why Home Prices Are Rising During the Pandemic While buyer demand has softened and sales fell 8.5% in March, the supply of homes on the market is contracting even faster
House prices up despite coronavirus, finds CoreLogic Despite a sharp drop in market activity and a severe weakening in consumer sentiment, home price rises were recorded across most capital cities, driving national house prices up 0.3 per cent in April. ... However, while sale prices continued to edge up, the number of home listings was 35 per cent lower at the end of April relative to the same time a year ago and 43 per cent below the five-year average.
NZ house prices rise in April but lockdown impact still unknown WELLINGTON, May 6 (Reuters) - New Zealand house prices rose an annual 7.1% in April to an average value of NZ$735,979 (€410,264)
eagle eye wrote: » Crikey, that's a whopping average house price in New Zealand.
Bass Reeves wrote: » I would not consider 15% a significant correction/drop. That would not cause consternation in the market. Last recession there were properties that dropped 75-80% some are still only 30-40%of there original price in some area's. I think outside of larger urban centers hoses prices have not skyrocketed as well there was a good few doer uppers still around. 15% would only be an issue to forced sellers and even then you have to be forced to sell for it to be a huge issue
schmittel wrote: » My view is that 15% is likely to be a minimum, I think about 30% is more probable. Sure if market ultimately bottomed out at 15% it probably wouldn't cause lasting consternation, but I if we reach that point I bet there will at least be a few jitters. Point is I think 15% is past soft landing territory.
Prezatch wrote: » I've seen one house in the 500-700k range fall 50k recently, granted it needs a lot of work and is an old building. But it was taken down, then reposted back up to avoid it showing up as a property price decrease on MyHome. Just FYI in case people are looking at that.
fliball123 wrote: You think they wanted someone in an asset that was depreciating for 4 years + and not getting a cent from the mortgage holder really?. I don't know how you do business but i can tell you of at least a half dozen people I know where the banks where hounding them to move out of the house as they had not paid the mortgage.
fliball123 wrote: Sorry the cost of the bailout for the banks was 40 billion but 200billion over all when ps pay pensions and welfare is factored in thats how much we had to borrow.
JimmyVik wrote: » But sure that was happening last year and the year before too. Houses are often put on the market and prices reduced because they were priced too high. One swallow and all that.
cnocbui wrote: » Back at the turn of the century, I traded up. The old house sat on the market for 14-16 months with no interest and no price reduction. Then all of a sudden, someone had a look and put in a bid, then another did, and another. Over a year of no interest and then suddenly 3 bidders. Sold for more than we were asking, of course. So a property just sitting unsold on the market doesn't necessarily mean the vendors are asking too much r trying it on.
Villa05 wrote: » You forget these were zombie institutions, they only went after people in trouble who had equity in their homes looking for a voluntary surrender. The customers they were chasing were in a better financial position than the banks were. I would just tell them sod off, knowing I will survive longer than they will plus there only alive because the tax payer is keeping them from going under The cost of the bank bailout was 64 billion at the time, the 40 billion is net of fees imposed on banks and share sales, however it appears to not include the interest paid to date on on the 64 billion which was over 5% initially before reducing over time. It also fails to take into account that banks pay no tax on profits currently as it is written off by losses the taxpayer has covered
Hubertj wrote: » when people refer to soft landing is it how far they fall or how long it takes to fall or a combination of both? So if it is 20% over 12-18 months that doesn't sound soft to me but 20% over 36 months sounds softer?
Ozark707 wrote: » I presume at the turn of the century HP's were increasing all the time so this wouldn't have surprised me. Now however would it not be a good selling strategy to show you are mindful of where the market is at. If you reduce the AP and get a bidding war going it could turn out to be the correct strategy. I am see loads of places just sit on the market for 6-12 months in cases. They were overpriced pre Covid, so why on earth keep to the same pricing now? Obviously under no pressure to sell.
cnocbui wrote: » This overpriced meme just never ends. I just used the Property Price register 7-Jul to 9th Sep 2019 and averaged the first page of results: The average came to: €372,791. Then I looked at the Society of Chartered Surveyors Ireland construction replacement cost calculator for their 95 square m average 3 bedroom semi detached in Dublin. So that mostly leaves land, which everyone thinks is too expensive. Dublin is a capital city. I wonder what a building block costs in London or Paris or Amsterdam? No, I'll go easy and pick Brisbane. $232,500 was the average price in 2018. that's €137,874. So add €207,195 and we have €345,069. Well duck me.
SozBbz wrote: » Brisbane is not comparable to Dublin.... its how far down the list of Australian cities? Also please provide the source of your information because that sounds very low for me. Also you're talking about building costs and sales prices in the same breath - this is very confused. Also can you not the obvious issue with your "sample".... hint, its the clearly super premium apartment for €1.5m in D4.
cnocbui wrote: » It's a random sample, as in that's what the first page came up as. It's offset by the €92.5K one you didn't seem to want to mention. If I were to scroll the list a bit there's properties at over 700 and 950K, so there you go. If you want to average all 50, then be by guest, I doubt it's going to shift the average much. You are damned right about not comparing Brisbane and Dublin. Do you not get that I was deliberately going easy in picking Brisbane and not another capital city? If I were to pick the land price of a capital city, then that is likely to be way more than Brisbane, which would have shown up the Dublin house prices as cheap, rather than the overpriced everyone bangs on about. I got the Brisbane price from here: https://www.news.com.au/finance/real-estate/brisbane-qld/brisbane-backyards-nearly-30pc-smaller-than-a-decade-ago/news-story/93659ac68c8c72918ef8fe3f5424b76c
SozBbz wrote: » It doesn't matter that you picked the first page - the fact that you only picked one page means your sample is far too small to infer anything. I highlighted the 1.5m property because it highlights how irrelevant a sample of that size is. What are you spending time manually adding up and dividing numbers from the PPR for. The CSO publish annual stats and breakdown by houses and apartments. Thats far more credible. Classic..... saying you picked Brisbane because it fits your argument and simultaneously admitting all of the other more notable Austrailian cities would actually undermine your argument. Let alone Paris or Amsterdam as mentioned previously, which would actually annihilate your argument. We can all cherry pick data points to ourselves - but what you've done here is pretty transparent and therefore meaningless IMO.
Greyian wrote: » And yet you don't seem to see that he's saying property prices aren't overpriced... (which, is not a viewpoint I'd agree with, but that's irrelevant here)
SozBbz wrote: » People expect really high standards these days. I'm sure those rebuild costs reflect that. I went through them myself when getting insurance for my own home last year and they have to factor in all the mod cons that people expect in a new build, as even though my house is roughly 115 years old, to build it again as it was in its original state woulndlt be allowed. The rebuild on my house came in around €300k alone (less than the site value) and thats because if it were to be built from the ground up tomorrow, there'd be high spec wiring, underfloor heating, heat pump, it would be basically air tight...... basically it would probably be a far better house than it is currently, and certainly cheaper to run (although we'd lose the character). People expect all of that stuff these days yet are seemingly surprised that it costs a lot of money in comparison to building something even to say a 1980's standard which may or may not even have had central heating.
Donald Trump wrote: » That's a rebuilding calculator which includes the cost of demolition and disposal of existing structure
schmittel wrote: » Utterly fatuous nonsense. I get that it is perfectly normally to have differing views on the pricing of property and that is what makes a market but anybody trying to make an informed decision on this sort of analysis needs their head examined. Duck me indeed.
cnocbui wrote: » The bottom line is that Dublin was not overpriced before the pandemic, so expecting a 40% drop in prices is barking mad, especially given the supply shortage.
cnocbui wrote: » Even Linesight refer to the the SCSI replacement costs for residential: https://www.linesight.com/en-us/reports/ireland-2019/ Who are also quaoted by these architects: https://isabelbarrosarchitects.ie/blog/building-costs-ireland-2018/ I will welcome your no doubt soon to be provided figures on house construction costs vs current prices in Dublin. If you think my methodology is unsound, let's see yours. No, my sample average is within 2% of the actual figure for the average Dublin house price in 2019 of €366,000 in and around Sep 2019. Picking Brisbane wasn't because it fits my argument, quite the opposite, it was because it handicaps my argument considerably. Using the real asking price for vacant land in Dublin makes established houses in Dublin look positively cheap, but I didn't use Dublin prices because I knew there would have been an almight whinge that Dublin land prices are too steep, so I chose a non capital city land price that's probably a third to a fifth of actual Dublin land prices. The bottom line is that Dublin was not overpriced before the pandemic, so expecting a 40% drop in prices is barking mad, especially given the supply shortage.
cnocbui wrote: » I will welcome your no doubt soon to be provided figures on house construction costs vs current prices in Dublin. If you think my methodology is unsound, let's see yours.
Claw Hammer wrote: » This is an attempt to measure intrinsic value. it has nothing to do with market value. market value is what someone is prepared to and willing to pay. no less and no more. Land values, build costs etc are irrelevant.
