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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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lomb

GreeBo wrote: »

Tbf it's a great location and doesn't have any of the issues a similar sized apartment would have.
The interior seems in good condition, but character filled it ain't.

I particularly enjoyed the English gymnastics regarding the amount of height that was in the height of the height of the ceiling height. Height. (Height)

What's a one bed apartment worth in that area? Let's say it's 220 then this is worth what max 40% more? So 300k?

Markitron

lomb wrote: »

What's a one bed apartment worth in that area? Let's say it's 220 then this is worth what max 40% more? So 300k?

I don't know if it would affect the value but it seems really easy to break into as well.

Padre_Pio

Markitron wrote: »

I don't know if it would affect the value but it seems really easy to break into as well.

Price is extraordinary, but you could double the size without planning permission if you felt like it.

lomb

Padre_Pio wrote: »

Price is extraordinary, but you could double the size without planning permission if you felt like it.

Ok , add something for development value so what are we at 375? It would break my heart to live in that box and pay even that.

paulie13

Markitron wrote: »

I don't know if it would affect the value but it seems really easy to break into as well.

I agree, as does the owner. You can see bars across the outside of the sitting room window in the pics!

lomb

paulie13 wrote: »

I agree, as does the owner. You can see bars across the outside of the sitting room window in the pics!

And on bathroom!

accensi0n

Weird that they wrote Rathfarnham twice instead of Rathmines as well.

Wii776

Pointing out proximity to schools is a bit redundant... there is one bedroom

Markitron

paulie13 wrote: »

I agree, as does the owner. You can see bars across the outside of the sitting room window in the pics!

Makes it cosy

Wii776 wrote: »

Pointing out proximity to schools is a bit redundant... there is one bedroom

Nonsense, there is enough room for a small chest of drawers

cruizer101

Padre_Pio wrote: »

Price is extraordinary, but you could double the size without planning permission if you felt like it.

Extend to where, the space to the front and back side of the house looks to be someone elses driveway, seems you just own a small strip behind the house.

Can't imagine who is going to buy a house like that. You'd be better spending the money on a decent apartment to at least get some of the advantages of apartments.

mees2020

awec wrote: »

You are making the assumption you'll be able to buy the house you want, at the price you want, with the rates that you want. You are assuming that just because your own personal circumstances are unaffected, that you will still get credit. While you may be right, you may also be wrong, it's not a guarantee like you are insinuating.

On a side note, it doesn't make sense to calculate the cost of credit over the entire term like you are doing. You have no idea whatsoever what interest rates will look like 5 years from now. You have no idea what inflation will be like over the entire term.

Most important factors:

- Suitability of property for long term needs
- Ability to afford monthly repayments at stressed rates

My point was that buying a house now could have a much worse consequences in a long run than not buying.

We all understand "houses are now overpriced", thanks to banks starting the downhill. Nothing to do with the demand/offer. Economy stability is a way more important factor for banks, as usual.
Affordability of the money is what mainly dictates the estate price in this country. No cheap money from the banks, price drops.

If I don't buy now an overpriced house?
1. The house I want to buy may not be available in 6 months or a year as you said. I don't buy a house I want, which I don't have now anyway, so status quo.
2. In 6 months or a year, I will be able to buy a different house, maybe not ideal, but much cheaper, less risk for my family and bank, which ultimately means better interest rate in any scenario. More chances for re-mortgage as well. More chances to pay earlier and buy a better house in the future.
3. I still have savings, so I can survive recession for a couple of years, even if I loose my job.
4. I still have saving to move my family elsewhere. Maybe not every country will be affected as badly, who knows?

If I a go ahead and buy now an overpriced house?
1. Possibly, I still won't get a mortgage, banks are changing rules now every week. But I have to jump through all the hoops, stress and time.
2. I buy a new house and I am stick to this house and my mortgage. I can't move anywhere.
3. Tbh, I don't believe laws re arrears will remain same in this country. Its not same in other EU, so I believe Irish banks will start to repossess eventually and more aggressively. Especially, when government keeps to pressure them for a lower interest rates. Also living in arrears probably will do more harm to my mental health, than renting.
4. If prices will drop significantly, I go deeply into negative equity, liquidity of the house won't exist for years or decades.

toughlife

cruizer101 wrote: »

Extend to where, the space to the front and back side of the house looks to be someone elses driveway, seems you just own a small strip behind the house.

Can't imagine who is going to buy a house like that. You'd be better spending the money on a decent apartment to at least get some of the advantages of apartments.

Would rather live in my own place than apartment.

cnocbui

mees2020 wrote: »

My point was that buying a house now could have a much worse consequences in a long run than not buying.

We all understand "houses are now overpriced", thanks to banks starting the downhill. Nothing to do with the demand/offer. Economy stability is a way more important factor for banks, as usual.
Affordability of the money is what mainly dictates the estate price in this country. No cheap money from the banks, price drops.

If I don't buy now an overpriced house?
1. The house I want to buy may not be available in 6 months or a year as you said. I don't buy a house I want, which I don't have now anyway, so status quo.
2. In 6 months or a year, I will be able to buy a different house, maybe not ideal, but much cheaper, less risk for my family and bank, which ultimately means better interest rate in any scenario. More chances for re-mortgage as well. More chances to pay earlier and buy a better house in the future.
3. I still have savings, so I can survive recession for a couple of years, even if I loose my job.
4. I still have saving to move my family elsewhere. Maybe not every country will be affected as badly, who knows?

If I a go ahead and buy now an overpriced house?
1. Possibly, I still won't get a mortgage, banks are changing rules now every week. But I have to jump through all the hoops, stress and time.
2. I buy a new house and I am stick to this house and my mortgage. I can't move anywhere.
3. Tbh, I don't believe laws re arrears will remain same in this country. Its not same in other EU, so I believe Irish banks will start to repossess eventually and more aggressively. Especially, when government keeps to pressure them for a lower interest rates. Also living in arrears probably will do more harm to my mental health, than renting.
4. If prices will drop significantly, I go deeply into negative equity, liquidity of the house won't exist for years or decades.

Which capital cities in the EU are Dublin houses overpriced, when compared to?

SozBbz

mees2020 wrote: »

My point was that buying a house now could have a much worse consequences in a long run than not buying.

We all understand "houses are now overpriced", thanks to banks starting the downhill. Nothing to do with the demand/offer. Economy stability is a way more important factor for banks, as usual.
Affordability of the money is what mainly dictates the estate price in this country. No cheap money from the banks, price drops.

If I don't buy now an overpriced house?
1. The house I want to buy may not be available in 6 months or a year as you said. I don't buy a house I want, which I don't have now anyway, so status quo.
2. In 6 months or a year, I will be able to buy a different house, maybe not ideal, but much cheaper, less risk for my family and bank, which ultimately means better interest rate in any scenario. More chances for re-mortgage as well. More chances to pay earlier and buy a better house in the future.
3. I still have savings, so I can survive recession for a couple of years, even if I loose my job.
4. I still have saving to move my family elsewhere. Maybe not every country will be affected as badly, who knows?

If I a go ahead and buy now an overpriced house?
1. Possibly, I still won't get a mortgage, banks are changing rules now every week. But I have to jump through all the hoops, stress and time.
2. I buy a new house and I am stick to this house and my mortgage. I can't move anywhere.
3. Tbh, I don't believe laws re arrears will remain same in this country. Its not same in other EU, so I believe Irish banks will start to repossess eventually and more aggressively. Especially, when government keeps to pressure them for a lower interest rates. Also living in arrears probably will do more harm to my mental health, than renting.
4. If prices will drop significantly, I go deeply into negative equity, liquidity of the house won't exist for years or decades.

Property rights are ingrained in our constitution - I wouldnt bank on this claim.

The govt are pressuring the banks for cheaper rates? Havent heard that one in a while. They were when they were north of 4%, but I havent heard that as being a topic in at least 18 months. My mortgage is at 2.25% so while obviously I'd like a lower rate, its hardly that problematic.

fliball123

mees2020 wrote: »

My point was that buying a house now could have a much worse consequences in a long run than not buying.

We all understand "houses are now overpriced", thanks to banks starting the downhill. Nothing to do with the demand/offer. Economy stability is a way more important factor for banks, as usual.
Affordability of the money is what mainly dictates the estate price in this country. No cheap money from the banks, price drops.

If I don't buy now an overpriced house?
1. The house I want to buy may not be available in 6 months or a year as you said. I don't buy a house I want, which I don't have now anyway, so status quo.
2. In 6 months or a year, I will be able to buy a different house, maybe not ideal, but much cheaper, less risk for my family and bank, which ultimately means better interest rate in any scenario. More chances for re-mortgage as well. More chances to pay earlier and buy a better house in the future.
3. I still have savings, so I can survive recession for a couple of years, even if I loose my job.
4. I still have saving to move my family elsewhere. Maybe not every country will be affected as badly, who knows?

If I a go ahead and buy now an overpriced house?
1. Possibly, I still won't get a mortgage, banks are changing rules now every week. But I have to jump through all the hoops, stress and time.
2. I buy a new house and I am stick to this house and my mortgage. I can't move anywhere.
3. Tbh, I don't believe laws re arrears will remain same in this country. Its not same in other EU, so I believe Irish banks will start to repossess eventually and more aggressively. Especially, when government keeps to pressure them for a lower interest rates. Also living in arrears probably will do more harm to my mental health, than renting.
4. If prices will drop significantly, I go deeply into negative equity, liquidity of the house won't exist for years or decades.

Can I ask a fundamental question here how do you or anyone else know what the price of a property is worth? How do you know they are overpriced? If the central bank had not put the restrictions in prices would of gone up a hell of a lot more in the last decade..

fliball123

cnocbui wrote: »

Which capital cities in the EU are Dublin houses overpriced, when compared to?

Futher add to this which Capital City which is the only English speaking capital city in the EU (once brexit is done) is this overpriced in comparison to?

When you put this into context with this list I think Ireland and Dublin would look very attractive to anyone looking to live within the EU

https://www.numbeo.com/cost-of-living/region_prices_by_city?itemId=100&region=150

Villa05

SozBbz wrote:

Property rights are ingrained in our constitution - I wouldnt bank on this claim.

What do you mean in relation to the point you responded to?

SozBbz

Villa05 wrote: »

What do you mean in relation to the point you responded to?

I bolded the sections of the post that I was responding to and gave my responses in sequence, so not sure how thats hard to follow but anyway...

1. poster things banks are going to be able to aggressively repossess houses. not likely anytime soon, if you consider our constitution and the political climate here.
2. poster was talking about political pressure on banks to lower interest rates. I don't believe this is currently topical and hasn't been for some time.

Donald Trump

enableMacr0s wrote: »

That's bad but imagine paying 500k for a house in Corduff? I can't provide a link due to being a new member but just Google "4 westway rise blanchardstown dublin" and click on the link to the daft.ie website.

For those unaware it is one of the worst areas in the country. I can't help but nearly indulge in schadenfreude in what this crash is going to do to the housing market and EAs/Vendors like the ones provided in the link. I don't wish miss fortune on anyone but this is taking the p!ss.

It must be good though? The Estate Agents/sellers for your blanchardstown property have Trinity College Dublin as their partners? Must be legit.

https://www.handingin.com/aboutus

They also bought their other 700k property for sale at a bidx1 auction last year for 704k. https://bidx1.com/en/en-ie/auction/property/36038

mees2020

cnocbui wrote: »

Which capital cities in the EU are Dublin houses overpriced, when compared to?

The fact Irish banks lowered valuations by 10% means that banks in Ireland think houses are overpriced, probably taking into account current economy situation in Ireland or forecast.
Because the property market highly dependent on banks, it will follow the guidance.

It has nothing to do with property prices in other EU cities.

Dylan94

enableMacr0s wrote: »

That's bad but imagine paying 500k for a house in Corduff? I can't provide a link due to being a new member but just Google "4 westway rise blanchardstown dublin" and click on the link to the daft.ie website.

This has to be some kind of Joke? How could anyone in their right mind think they are going to get half a million for that!

https://touch.daft.ie/for-sale/semi-detached-house-4-westway-rise-blanchardstown-co-dublin/2275762

SozBbz

mees2020 wrote: »

The fact Irish banks lowered valuations by 10% means that banks in Ireland think houses are overpriced, probably taking into account current economy situation in Ireland or forecast.
Because the property market highly dependent on banks, it will follow the guidance.

It has nothing to do with property prices in other EU cities.

No it literally does not mean that.

Houses are worth what people will pay for them, the same as any asset. Prices of assets go up and down. That implies that there will be peaks and troughs. Markets are cyclical and just because banks are being cautious in light of the current exceptional challenges, doesnt mean they're overpriced. Overpriced is a nonsense concept, its all relative.

fliball123

mees2020 wrote: »

The fact Irish banks lowered valuations by 10% means that banks in Ireland think houses are overpriced, probably taking into account current economy situation in Ireland or forecast.
Because the property market highly dependent on banks, it will follow the guidance.

It has nothing to do with property prices in other EU cities.

So then ask why were the banks lending to people up until now for property that they (accodring to you) knew prices were over priced by 10% if that was the case I would imagine that the banks board would be sacked for such reckless lending.. The fact is the above statement is the bank trying to protect themselves for future borrowing they know if they stop lending the government will be on their case due to the housing crisis. The fact is you , I or the banks dont really know how much a house in this country is worth. The only real way to know is what a person is willing to pay and actually pays the price and currently there is about 90% properties up there that are in limbo or not for sale as in no one wants to buy them and no one wants to sell them. We cant get a proper gauge on what prices are. It will be spring of next year before the property market opens up in any real terms. We may get an idea of price drops then

The Student

mees2020 wrote: »

The fact Irish banks lowered valuations by 10% means that banks in Ireland think houses are overpriced, probably taking into account current economy situation in Ireland or forecast.
Because the property market highly dependent on banks, it will follow the guidance.

It has nothing to do with property prices in other EU cities.

it could also mean that the prices are correct and that banks are protecting themselves from non payment of mortgages where it takes so long to get someone out.

if someone wants to buy a property at a given price and the bank will only give x amount the purchaser may have to come up with the difference between what the bank want to give and what the purchaser needs.

hometruths

SozBbz wrote: »

No it literally does not mean that.

Houses are worth what people will pay for them, the same as any asset. Prices of assets go up and down. That implies that there will be peaks and troughs. Markets are cyclical and just because banks are being cautious in light of the current exceptional challenges, doesnt mean they're overpriced. Overpriced is a nonsense concept, its all relative.

Houses are worth what people are willing and able to pay for them.

And whilst the buyers might have a 100k deposit and bank is willing to lend you 400k, if the bank says the house you want to buy for €500k is only worth €450k (i.e they're only prepared to lend 80% of that value), you wont be buying it unless you find more money or the seller budges.

So whilst it's true to say that banks being cautious doesn't mean a house is overpriced, it does mean that prices will fall.

SozBbz

schmittel wrote: »

Houses are worth what people are willing and able to pay for them.

And whilst the buyers might have a 100k deposit and bank is willing to lend you 400k, if the bank says the house you want to buy for €500k is only worth €450k (i.e they're only prepared to lend 80% of that value), you wont be buying it unless you find more money or the seller budges.

So whilst it's true to say that banks being cautious doesn't mean a house is overpriced, it does mean that prices will fall.

Fine - willing and able. The point I was making is theres no gold standard or absolute value/worth of a house. The market sets the price and it can be below or above land/construction costs depending on where the market is at that point in time.

I actually repeatedly made exactly the point bolded above about 3 days ago on this same thread and was rounded on by other posters. FFS. Don't get me wrong, I knew I was right, but this thread is just so draining at times.

The Student

Villa05 wrote: »

The property market was controlled by government. Michael Nonnan effectively said so a few years back when asked about affordability he stated that prices needed to go up a litlle bit more. This was years after supply issues in high demand areas

How did they do this?
Nama,
Almost full control of banks.
Punitive double digit interest rate for development of resdintitial property
Banning of bedsits
Stimulating demand ftb grants while suffocating supply
Washing their hands of social and affordable housing. The private market cannot provide housing for all it can barely accommodate the top 30% of income earners
Allowing mortgage defaults to climb to epic proportions without any consequence. This further strangled supply and has set a dangerous precedent for the forthcoming recession

The supply demand imbalance is a result of government policy and inaction

Nama was set up as a result of the banking crisis. We needed a functioning banking system and property was the only assets banks had. We as a State ran the risk of a run on the banks. Nama was not set up to control prices (if that was the case why did property prices fall through the floor post 2009?)

Control of banks was needed as a return on the bailout payments and the recapitalisation of banks. Again this was needed to have a functioning banking sector.

Banning of bedsits was a bad decision. This should never have happened without alternative options. There was no logical reasoning for this.

Stimulating first time buyers was required simply because developers would not develop if not profitable to do so, with the increased regulations, low emission requirements the cost of building a property has increased and somebody has to pay for it. Also we needed extra housing so incentives had to be given.

Social and affordable housing is an issue in Ireland. I recently read an article that stated 60% of social housing tenants in Dublin were in arrears (this was a 2019 figure). If my memory serves me right there were two in arrears of over €20k and it took a couple of years of going through legal channels before a court would grant an eviction.

The issue with with delayed repossessions for non payment of mortgages is also and issue but no one will deal with it.

Until the above are changed we will continue to have the same issues and discussions for years to come.

GreeBo

Wii776 wrote: »

Pointing out proximity to schools is a bit redundant... there is one bedroom

Pervert friendly location?

GreeBo

mees2020 wrote: »

My point was that buying a house now could have a much worse consequences in a long run than not buying.

and I and others have pointed out that not buying could have much worse consequences than buying.

mees2020 wrote: »

We all understand "houses are now overpriced", thanks to banks starting the downhill. Nothing to do with the demand/offer. Economy stability is a way more important factor for banks, as usual.
Affordability of the money is what mainly dictates the estate price in this country. No cheap money from the banks, price drops.

I don't think "we all" understand that at all.
Some houses are overpriced, in my opinion, some are also under priced, in my opinion.
What does "Banks cutting valuations by 10%" even mean, in reality?

mees2020 wrote: »

If I don't buy now an overpriced house?
1. The house I want to buy may not be available in 6 months or a year as you said. I don't buy a house I want, which I don't have now anyway, so status quo.

You status quo like thats automatically a good thing. What if status quo means I continue to pay €2,500 a month in rent and my mortgage would be less than this?

mees2020 wrote: »

2. In 6 months or a year, I will be able to buy a different house, maybe not ideal, but much cheaper, less risk for my family and bank, which ultimately means better interest rate in any scenario. More chances for re-mortgage as

Maybe in 6 months time I can do that. Or maybe in 6 months time lender rules change and I cant get a mortage for the same amount. Or maybe interest rates are up and I cant afford the repayment on the house I want.

mees2020 wrote: »

3. I still have savings, so I can survive recession for a couple of years, even if I loose my job.

Really? So your rent takes care of itself then?

mees2020 wrote: »

4. I still have saving to move my family elsewhere. Maybe not every country will be affected as badly, who knows?

???

mees2020 wrote: »

If I a go ahead and buy now an overpriced house?
1. Possibly, I still won't get a mortgage, banks are changing rules now every week. But I have to jump through all the hoops, stress and time.

If the banks change the rules then be definition you dont buy the house now.

mees2020 wrote: »

2. I buy a new house and I am stick to this house and my mortgage. I can't move anywhere.

Why would you want to move from a house you just bought? Why did you buy it if you arent going to want to live in it?

mees2020 wrote: »

3. Tbh, I don't believe laws re arrears will remain same in this country. Its not same in other EU, so I believe Irish banks will start to repossess eventually and more aggressively. Especially, when government keeps to pressure them for a lower interest rates. Also living in arrears probably will do more harm to my mental health, than renting.

Arrears? Why am I in arrears all of a sudden?

mees2020 wrote: »

4. If prices will drop significantly, I go deeply into negative equity, liquidity of the house won't exist for years or decades.

And? You will continue to pay the mortgage that you were paying from the start, the one you agreed to.

cnocbui

mees2020 wrote: »

The fact Irish banks lowered valuations by 10% means that banks in Ireland think houses are overpriced, probably taking into account current economy situation in Ireland or forecast.
Because the property market highly dependent on banks, it will follow the guidance.

It has nothing to do with property prices in other EU cities.

So before the virus, houses were not over priced in Dublin then.

If you are going to make a statement like 'houses are overpriced', then there needs to be something to measure or compare the prices against. House prices in other European capital cities is a very appropriate yardstick. I understand why you would want to deny this, but it's not going away as a valid yardstick just because it doesn't suit your attempted narrative.

The banks are taking a defensive stance on the basis of expectations of peoples abilities to repay loans - they are in effect undervaluing so that should they have to repossess and sell because of a default, they will have an easy job of it because they undervalued in the first place.

I'd like to see some of the overvalued crowd walk into a car yard and try and argue down the price of a new BMW on the basis of a bank refusing to lend the full amount because the bank thought it overvalued. BMW would have no hesitation in telling the bank wher it could stick it's valuation.