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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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wassie

Exactly. Probably not the best exemplar given Berkshire Hathaway aren't known for hoovering bargains, but rather buying great businesses at fair prices. The post shows no understanding of value investing.

And Warren Buffet would probably be one of the most humble billionaires on the planet.

Marius34

fergiesfolly wrote: »

Does anyone think that this will have an impact on property prices..
https://www.breakingnews.ie/ireland/property-sales-to-plummet-by-up-to-50-due-to-covid-19-crisis-1002982.html

TheSheriff wrote: »

Don't really think it tells us anything to be honest.

Its basically saying transactions will be down 40% -50% which is quite logical when the market has been effectively closed for months during what I imagine is a usually busy time of year (Jan - exemptions, summer - prime buying season). And once we are back, viewings will need to abide by social distancing norms leading to reduced numbers per viewing.

Lots of click-bait articles floating around unfortunately, very little fact based articles.

From what I understand they talk about 40%-50% transactions down over year term, on 2019 vs 2020. Which doesn't sound logical, but exaggerated, I don't think they did a proper analysis.

cnocbui

wassie wrote: »

Exactly. Probably not the best exemplar given Berkshire Hathaway aren't known for hoovering bargains, but rather buying great businesses at fair prices. The post shows no understanding of value investing.

And Warren Buffet would probably be one of the most humble billionaires on the planet.

Yeah, right:

"Every decade or so, dark clouds will fill the economic skies, and they will briefly rain gold. When downpours of that sort occur, it’s imperative that we rush outdoors carrying washtubs, not teaspoons. And that we will do."

https://finance.yahoo.com/news/warren-buffett-every-decade-dark-142314188.html

As a result, Berkshire is now sitting on roughly $125 billion in cash and short-term investments that can be readily deployed as bargains emerge on the market. You can't be greedy when others are fearful, after all, if you don't have any money to invest. Buffett capitalized similarly during the financial crisis when he had about $38 billion in cash and made big, well-timed investments in Goldman Sachs and Bank of America. During September and October of 2008, he made $15 billion in investments.

https://www.msn.com/en-us/money/savingandinvesting/warren-buffetts-4-rules-for-investing-in-a-bear-market/ar-BB116noI

Experts, including Buffet, are very strong on the notion that you can't time the market bottoms and tops, so I have been out there with my teaspoon, along with many others, pumping the price up.

cnocbui

Augeo wrote: »

Didn't they dive in when the market dipped 30%..

No, that wasn't enough for them and they are predicting another dip when the market finally realises how badly many companies will be affected and how long the recovery will take. I get the impression they were expecting to be waiting a year or more.

They are like those expecting big falls in house prices next year and are waiting for that. Very strong similarity in the two situations.

errlloyd

My mortgage advisor told me that none of the lenders are currently granting Loan to Income exemptions? Is that everyone else's experience?

bulmersgal

errlloyd wrote: »

My mortgage advisor told me that none of the lenders are currently granting Loan to Income exemptions? Is that everyone else's experience?

Yeah that's what my broker told me last week.

James 007

Guess whos back, back again:rolleyes:

The two bed at €200k seems reasonable for the location

Interesting two properties just 10mins from each other, €100k difference between the two, one clearly has that better address.

https://www.daft.ie/dublin/apartments-for-sale/glasnevin/apartment-13-tolka-vale-finglas-road-glasnevin-dublin-2535573/

Current Bid - No offers

https://www.daft.ie/dublin/apartments-for-sale/glasnevin/apartment-22-clonmore-court-glasnevin-dublin-2286571/

Current Bid - €270k

cunnifferous

bulmersgal wrote: »

Yeah that's what my broker told me last week.

Yep that's what mine told me too. I think because all of a sudden the amount of loans they are giving out in going to be greatly reduced, it means they might be already be exceeding the number of exemptions that they are permitted.

ELM327

Plus, it would be pretty silly to give exemptions in a downward market.
If you're giving a 4.5 LTI exemption to someone now, when next year (as many reports this morning are reading) the price may have fallen 10-20%, you're looking at possible 0 or negative equity... as well as potential affordability issues. In a market where we make it very difficult to reposess anyway. Not a good idea.

TM2015

errlloyd wrote: »

My mortgage advisor told me that none of the lenders are currently granting Loan to Income exemptions? Is that everyone else's experience?

For sure. Got the AIP no problem but were told that to come back 6 months for an LTI exemption. High enough income, public/private sector but a need 4x salary exemption to allow us to purchase in the area we want.

kippy

TM2015 wrote: »

For sure. Got the AIP no problem but were told that to come back 6 months for an LTI exemption. High enough income, public/private sector but a need 4x salary exemption to allow us to purchase in the area we want.

The area you are lookingin may be less than 4X salary in a few months so hard to know if its a good thing or a bad thing.

c.p.w.g.w

Just seen a house relisted, was up for €150k since xmas...removed mid April and relisted today after a tidy up...€175k:eek::eek::eek::eek:

Reversal

UK prices falling as soon as the market was allowed to open.

"UK house prices fall at fastest rate since 2009"

https://www.google.com/amp/s/www.rte.ie/amp/1144889/

ELM327

c.p.w.g.w wrote: »

Just seen a house relisted, was up for €150k since xmas...removed mid April and relisted today after a tidy up...€175k:eek::eek::eek::eek:

Listing price is pretty irrelevant
Looking at sold prices is where its at.

How recent is the PPR?

c.p.w.g.w

ELM327 wrote: »

Listing price is pretty irrelevant
Looking at sold prices is where its at.

How recent is the PPR?

Last property was over 3 years ago for nearly half the price, adjacent estates are seen are more desirable and going for 150k - 200k...but all these house are in need of cosmetic work and potentially updating of doors/windows & heating systems

ShedTower

c.p.w.g.w wrote: »

Just seen a house relisted, was up for €150k since xmas...removed mid April and relisted today after a tidy up...€175k:eek::eek::eek::eek:

Everyone will be looking for a discount. Now they can drop €25k off it.

c.p.w.g.w

ShedTower wrote: »

Everyone will be looking for a discount. Now they can drop €25k off it.

That exactly what i was thinking...offer the original list price...seller is happy and buyer thinks they got a bargain:D

gourcuff

what are the chances early 2020 becomes the 2006,2007 in terms of absolute worst time to have bought a house?...

moved from a one bed to our first house, so felt fortunate with lockdown etc...

but wonder could this be viewed in years to come as a huge blunder in timing?

TM2015

kippy wrote: »

The area you are lookingin may be less than 4X salary in a few months so hard to know if its a good thing or a bad thing.

Yeah we're just sitting tight as we're not under any pressure. It's Blackrock/Booterstown and the local market appears to be dead as a dodo. Saving a huge amount of extra money because of Covid so may not even need the exemption by the time anything decent appears.

errlloyd

gourcuff wrote: »

what are the chances early 2020 becomes the 2006,2007 in terms of absolute worst time to have bought a house?...

moved from a one bed to our first house, so felt fortunate with lockdown etc...

but wonder could this be viewed in years to come as a huge blunder in timing?

I am a complete amateur (as we all are).

But I suspect it'll never be quite as bad again. 2020 may well be the worst time to buy in this boom-bust cycle, but I don't think we will see massive, life ruinous drops.

SozBbz

gourcuff wrote: »

what are the chances early 2020 becomes the 2006,2007 in terms of absolute worst time to have bought a house?...

moved from a one bed to our first house, so felt fortunate with lockdown etc...

but wonder could this be viewed in years to come as a huge blunder in timing?

I mean - doubtful. If you look back on this thread there was a discussion on how those who bought at he height of the last boom are now not badly off if you compaired it to having rented the whole time. They're almost halfway through their mortgages, mostly on trackers, and their repayments compair really favourably to what they'd be paying in rent for the same period.

I'm talking of course about people who bought family homes during that time. If you bought a 1bed apt and then went on to have a family, then yes that would not have worked out well. But if you bought a house you never intend to leave, then a lot of people did alright in hindsight.

I really don't think 2020 will be a doomsday scenario. Its going to be a deep recession on paper but if the govt don't implement austerity it won't feel half as bad as 2008. Yes we'll be paying it back for a long time, but hopefully at negligable rates.

The_Conductor

errlloyd wrote: »

I am a complete amateur (as we all are).

But I suspect it'll never be quite as bad again. 2020 may well be the worst time to buy in this boom-bust cycle, but I don't think we will see massive, life ruinous drops.

There really is nothing life ruinous about it.
If you're buying- you're buying into a lower market.
If you're selling- you're selling into a lower market and probably buying into a lower market somewhere else.
If you're neither selling nor buying- its a roof over your head- and the nominal value of the property is immaterial.

The bigger issue in all of this- is that lending dries up, and regardless of whether you're trying to buy, sell or simply exist on a day-to-day basis, cash is not available to do anything- and the economy gums up.

Last time round we bailed out the banks.
This time round- the Irish banks are in a far better position than last time- however, its still probable that they will simply call a halt on lending (or at very least tailor their lending to only give loans to the most secure of possibly borrowers.

The bigger issue- is a lack of lending- prices going up and down- are normal, people not being able to borrow regardless of their circumstances, is not.

Roberto_gas

gourcuff wrote: »

what are the chances early 2020 becomes the 2006,2007 in terms of absolute worst time to have bought a house?...

moved from a one bed to our first house, so felt fortunate with lockdown etc...

but wonder could this be viewed in years to come as a huge blunder in timing?

Not just early 2020 but throughout 2020 end and early 20201.....i posted few weeks back that actual realization of the impacts will take time to surface...no way anyone getting away with this whatever gov measures are taken....the QE being done in US and elsewhere needs to be paid by someone somewhere....time will tell who that would be...generally its taxpayers.

The_Conductor

Roberto_gas wrote: »

the QE being done in US and elsewhere needs to be paid by someone somewhere....time will tell who that would be...generally its taxpayers.

Thats just it though. An increasing number of finance gurus are suggesting that no, it doesn't need to be repaid. This plays into the Trumpian economics- which includes setting the rule books on fire.

If The Fed and others can simply print money- and inflation remains tame- the argument goes, why not keep printing money........

Obviously, at some stage- someone somewhere will have to pay the piper- but for now- they're merrily printing away, and inflation is negligible.

awec

gourcuff wrote: »

what are the chances early 2020 becomes the 2006,2007 in terms of absolute worst time to have bought a house?...

moved from a one bed to our first house, so felt fortunate with lockdown etc...

but wonder could this be viewed in years to come as a huge blunder in timing?

Don't overly concern yourself with it. The fact is that the overwhelming majority of people do not get to buy at the best time. By definition it is impossible. The best time to buy is when the overwhelming majority cannot.

Once you can afford the repayments then don't drive yourself crazy with these "what if" thoughts, get on with your life and enjoy it as much as you can.

Someone, somewhere will always get a better deal than you.

Roberto_gas

The_Conductor wrote: »

Thats just it though. An increasing number of finance gurus are suggesting that no, it doesn't need to be repaid. This plays into the Trumpian economics- which includes setting the rule books on fire.

If The Fed and others can simply print money- and inflation remains tame- the argument goes, why not keep printing money........

Obviously, at some stage- someone somewhere will have to pay the piper- but for now- they're merrily printing away, and inflation is negligible.

What about actual impact on GDP ?

The_Conductor

Roberto_gas wrote: »

What about actual impact on GDP ?

First off- looking at debt:GPD ratios- several EU countries are already totally ignoring the Debt:GDP ratios, despite the ominous threats from the ECB, the EU Commission and others (look at France- for example, Italy are the obvious villain and then you have the likes of Spain and Portugal (ignoring the comedian that is Greece)).

The bigger issue- is for all those who hold all this paper (China and others). The US is getting away with daylight robbery of the rest of the world- because they are the default reserve currency (the Euro is only roughly 20-22% of reserve holdings).

GDP itself is a lot resiliant than it has any right to be expected (especially in the context of the EU). Asset prices may be incredibly volatile, but in general, are more robust than fundamentals suggest they should be.

Lots of things- just aren't supported by everything that is happening, or not happening- and the unknowns in the larger global economy do not seem to be priced into investors expectations.

At the moment- the capital markets are drunk on QE. Wait until the taps are turned off, whenever that might be, then those who are weaker (be they sovereigns or whoever) will be pushed and pummeled by market forces.

At the moment- nothing is real, no-one is looking at the bigger picture, people are pushing the boat out, further and further, and because they are getting away with it, imagine that its a 'new normal', when it very probably isn't- and a day of reckoning will eventually come..........

cnocbui

gourcuff wrote: »

what are the chances early 2020 becomes the 2006,2007 in terms of absolute worst time to have bought a house?...

moved from a one bed to our first house, so felt fortunate with lockdown etc...

but wonder could this be viewed in years to come as a huge blunder in timing?

Market cycles tend to be such a significant fraction of an average human lifespan that i think you should just get on with doing what you want, when you want/can and don't worry too much about whether you got a bargain or not.

hometruths

The_Conductor wrote: »

Thats just it though. An increasing number of finance gurus are suggesting that no, it doesn't need to be repaid. This plays into the Trumpian economics- which includes setting the rule books on fire.

If The Fed and others can simply print money- and inflation remains tame- the argument goes, why not keep printing money........

Obviously, at some stage- someone somewhere will have to pay the piper- but for now- they're merrily printing away, and inflation is negligible.

If that's the playbook for the future anyone saving for a deposit should be buying gold rather than putting it in the bank.

Sooner or later they won't need a mortgage at all!

The_Conductor

schmittel wrote: »

If that's the playbook for the future anyone saving for a deposit should be buying gold rather than putting it in the bank.

Sooner or later they won't need a mortgage at all!

Lots of people are buying gold and other commodities (the commodity of choice this week seems to be aluminium). People who have never bought or sold a share in their lives- are buying commodity futures.

At the moment there is precious little reason to save in banks- and some banks are even charging for looking after your money. It makes sense to try and lock some upside into your savings if you can- but trying to generate 'upside' while still have liquidity- is an interesting game. This is a large part of the reason behind all those oil traders who got caught out- and needed to get shot of their oil holdings- at any cost- including a negative value for oil.

There is so much out there that simply doesn't make sense...........