Property Market 2020

The_Conductor · 04-06-2020 4:52pm

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...........

cnocbui · 04-06-2020 5:00pm

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!

YTD return for gold is 11.78%

YTD return for Bitcoin is 35.29%

Either will do and anything is better than having money sitting in an Irish bank account. One day the stupids in government might wake up as to why the banks are always in dire straits.

GreeBo · 04-06-2020 5:42pm

cnocbui wrote: »

YTD return for gold is 11.78%

YTD return for Bitcoin is 35.29%

Either will do and anything is better than having money sitting in an Irish bank account. One day the stupids in government might wake up as to why the banks are always in dire straits.

Cash in your bank account wont disappear overnight like it could with BTC.

pearcider · 04-06-2020 6:07pm

cnocbui wrote: »

YTD return for gold is 11.78%

YTD return for Bitcoin is 35.29%

Either will do and anything is better than having money sitting in an Irish bank account. One day the stupids in government might wake up as to why the banks are always in dire straits.

Cash is safe from confiscation (no need when the central banks can control the money supply) but not from inflation.

Bit coin is down 50% from its peak. It lost one third of its value in 24 hours. This could never happen with Gold.

Gold is at all time highs in euro and indeed all currencies except the dollar...It also has 100 times the market capitalisation of BTC. Most importantly national treasuries and central banks don’t have huge reserves of bitcoin. They do keep tens of thousands of tonnes of gold though.

cnocbui · 04-06-2020 6:26pm

GreeBo wrote: »

Cash in your bank account wont disappear overnight like it could with BTC.

What? I have some BTC and am pretty confident it can't disappear overnight.

Did you ever notice the Crete bank account deposit confiscation? At the time, it was said that many eyes were paying attention with great interest with a view to implimenting the same mechanism elsewhere within the EU.

According to the Financial Times, Greece’s battered banks are “preparing contingency plans for a possible ‘bail-in’ of bank accounts, in case the country doesn’t enter into a bailout scheme soon.

Veteran FT correspondent in Athens Kerin Hope bylines the article, which was posted two days before Greeks head to the polls in a referendum viewed by most – sans the leftist Greek government – as deciding the country’s membership in the eurozone.

The article refers to plans for a “haircut” of at least… 30 percent (ouch) on deposits above 8,000 euros “for at least one bank”, citing sources.

The article then refers to the 2013 bail-in Cyprus, where the cut-off was 100,000 euros at the time, with the intent to shore up the island republic’s banking system with the billions deposited in Cypriot banks to take advantage of higher interest rates and perceived lax controls on the source of the money.

http://en.protothema.gr/ft-contingency-plans-eye-haircut-on-greek-banks-deposits-above-8k/

pearcider wrote: »

Cash is safe from confiscation (no need when the central banks can control the money supply) but not from inflation.

Bit coin is down 50% from its peak. It lost one third of its value in 24 hours. This could never happen with Gold.

Gold is at all time highs in euro and indeed all currencies except the dollar...It also has 100 times the market capitalisation of BTC. Most importantly national treasuries and central banks don’t have huge reserves of bitcoin. They do keep tens of thousands of tonnes of gold though.

Have you ever bought and sold gold bullion, you know, in real life as opposed to in your mind?

old_house · 04-06-2020 6:43pm

pearcider wrote: »

Bit coin is down 50% from its peak. "..." Gold is at all time highs in euro and indeed all currencies except the dollar.

May I present exhibit A: a chart of the value of one ounce of gold, priced in bitcoin:

Note that I had to set the chart to "log" in the attached image, otherwise the value of gold will be so low against bitcoin that it would be hardly visible on the chart after about 2014. Check for yourself, the chart is linked. Gold is not very far from its all time low in bitcoin, relatively speaking.
If you compare the performance of two assets you should not do that against a random third benchmark (Euro in this case) but directly to each other. Just saying.

Deub · 04-06-2020 7:00pm

cnocbui wrote: »

Did you ever notice the Crete bank account deposit confiscation? At the time, it was said that many eyes were paying attention with great interest with a view to implimenting the same mechanism elsewhere within the EU.

Unlikely going to happen. The consequences would be too damaging for the country. The 2 that comes to mind:

- people will stop keeping savings in banks based in Ireland and it would mean a decrease of tax for the revenue (unless they chase every bank account owners who moved money abroad but it would mean increasing staff in Revenue which defeat the purpose)

- some of our saving accounts is us buying irish debt. So less savings in Ireland would mean more difficulties for the country to finance its debt.

pearcider · 04-06-2020 7:52pm

old_house wrote: »

May I present exhibit A: a chart of the value of one ounce of gold, priced in bitcoin:

Note that I had to set the chart to "log" in the attached image, otherwise the value of gold will be so low against bitcoin that it would be hardly visible on the chart after about 2014. Check for yourself, the chart is linked. Gold is not very far from its all time low in bitcoin, relatively speaking.
If you compare the performance of two assets you should not do that against a random third benchmark (Euro in this case) but directly to each other. Just saying.

Right. BTC is still down 50% from it’s peak though.

old_house · 04-06-2020 8:00pm

pearcider wrote: »

Right. BTC is still down 50% from it’s peak though.

Yes, I did not dispute that. Just like gold is down 99.97% from its peak in bitcoin. The charts don't lie...

TheSheriff · 04-06-2020 8:16pm

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?

Enjoy your new home!

From someone going nuts in a rental apartment during lockdown.......

GreeBo · 04-06-2020 8:34pm

cnocbui wrote: »

What? I have some BTC and am pretty confident it can't disappear overnight.
?

It's value can disappear, just as happened with many other coins and tokens, take XRP for example.

pearcider · 04-06-2020 8:52pm

old_house wrote: »

Yes, I did not dispute that. Just like gold is down 99.97% from its peak in bitcoin. The charts don't lie...

Well you can certainly make the charts say whatever you like. The fact is there are BTC investors out there sitting on a 50% loss right now. Some lost 30% overnight. So you can pretend it’s the be all and end all but at this moment in time, it’s highly volatile and is therefore not a good store of value when compared with gold. I am not trying to disparage the underlying technology of bitcoin by the way. I just don’t think it can compete with gold until it solves its volatility problem.

old_house · 04-06-2020 8:59pm

GreeBo wrote: »

It's value can disappear, just as happened with many other coins and tokens, take XRP for example.

It's the wrong thread and I will not post anymore off topic after this. Just to make sure nobody gets this wrong:
GreeBo and pearcider are absolutely right. The value of bitcoin and any other cryptocurrency can change greatly at any time and it is certainly not a safe investment to secure a house purchase with. Nobody should pretend otherwise and caution is always advised when managing funds that one cannot afford to lose.
That being said: The fact that crypto is still being perceived as high risk by the masses means that the number of investors and the invested sums so far are relatively low in comparison to more established asset classes. With every passing day that bitcoin does not dissappear (10 years+ already) the confidence will grow and so will the userbase. How it will all end is still unknown, otherwise we wouldn't have this discussion. So if you want to try it out take a small amount that you can lose without risking your future. However small, it might still make a difference in the long run. But please don't bet your house on it.

hometruths · 04-06-2020 9:18pm

old_house wrote: »

Yes, I did not dispute that. Just like gold is down 99.97% from its peak in bitcoin. The charts don't lie...

Very similiar to the Gold/Tulip Bulbs chart in the 1630s.

In 1637 a single Viceroy tulip bulb would have cost you 365 ounces of gold.

Today, those same 356 ounces would buy you 837,644 tulip bulbs.

Chart's don't lie over the long term.

cnocbui · 04-06-2020 9:57pm

GreeBo wrote: »

It's value can disappear, just as happened with many other coins and tokens, take XRP for example.

Oh right, OK. It's by far the best performing investment I have ever made, beating my Irish property by several country miles. I haven't bought into any other cryptos, like XRP, for example.

kippy · 04-06-2020 9:59pm

cnocbui wrote: »

Oh right, OK. It's by far the best performing investment I have ever made, beating my Irish property by several country miles. I haven't bought into any other cryptos, like XRP, for example.

Good on you.

L1011 · 04-06-2020 10:00pm

There is a Cryptocurrency forum. Please use it

Mic 1972 · 04-06-2020 10:06pm

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?

Looking at the market right now it doesn't seem like there will be a major change. I was hoping there would be but I'm making my peace with it
The first half of the year was pretty strong so far, last reports suggest that there has been little activity during lock down but lots of online traffic on MyHome and Daft which means people are still very focused on buying
Covid will be over eventually, probably sooner than we think

PommieBast · 04-06-2020 11:06pm

The_Conductor wrote: »

At the moment there is precious little reason to save in banks- and some banks are even charging for looking after your money.

A minor reason why I am going ahead with my property purchase is basically to diversify into another non-cash asset class. BoI are still charging me fees even with €110k on deposit (AIB/PTSB/Ulster are a lot nicer..).

dickface · 05-06-2020 11:26am

ELM327 · 05-06-2020 11:42am

PommieBast wrote: »

A minor reason why I am going ahead with my property purchase is basically to diversify into another non-cash asset class. BoI are still charging me fees even with €110k on deposit (AIB/PTSB/Ulster are a lot nicer..).

You should not have more than 100k on deposit in the same bank.

The only advantages to having cash on deposit are:
-if less than 100k, covered by state guarantee
-liquidity at the opportunity cost of no profit
-looks good on a loan/mortgage application

Reversal · 05-06-2020 12:35pm

Mic 1972 wrote: »

Looking at the market right now it doesn't seem like there will be a major change. I was hoping there would be but I'm making my peace with it
The first half of the year was pretty strong so far, last reports suggest that there has been little activity during lock down but lots of online traffic on MyHome and Daft which means people are still very focused on buying
Covid will be over eventually, probably sooner than we think

It has not been a strong start to the year. 2020 saw the weakest ‘new year bump’ since the CB rules came into effect. The Q1 daft report showed Dublin asking prices down ~ 5% YOY. The CSO shows S Dublin areas down around 3% on the late 2018 peak, in actual prices achieved. This was all pre covid.

Then pause button was pressed on the market in March. Asking prices won’t drop yet as all EAs will do is base the asking prices off the most recent sales, all pre covid. So asking prices can’t drop in a frozen market. The UK reopened their housing market last month, and already they have seen a 2% decline in prices, the biggest monthly drop since the crash.

There is a risk of false hope right now. The health emergency is easing, and the economic emergency has yet to bite. But unfortunately, it will, the damage is done, no going back.

https://www.irishtimes.com/business/economy/in-six-months-we-will-be-in-the-grip-of-a-1980s-style-recession-1.4268947

Economically speaking, this is the quiet before the storm. In six months we will be in the grip of a 1980s-style recession in which about 300,000 workers will “permanently” lose their jobs. That’s not some dire warning from a Dracula economist, that’s the assessment of Minister for Finance Paschal Donohoe

TheSheriff · 05-06-2020 1:02pm

Don't doubt the data above / impending recession..... But god, If the start of the year wasn't that strong I can't imagine what it would be like during a 'strong' period.

Every house we viewed in Jan/Feb was packed with buyers, outbid on every property etc. Some calming will be very welcome I'm sure.

Claw Hammer · 05-06-2020 2:42pm

PommieBast wrote: »

A minor reason why I am going ahead with my property purchase is basically to diversify into another non-cash asset class. BoI are still charging me fees even with €110k on deposit (AIB/PTSB/Ulster are a lot nicer..).

Have you €110k o deposit with each of those banks as well?

Mad_maxx · 05-06-2020 3:14pm

the market wont fall that much , you only have to look at the U.S stock market to see that covid 19 is not the threat we thought it was

the U.S stock market is the best gauge of how the irish economy is going to go in the near future , we rely completely on american corporations for strong growth

Padre_Pio · 05-06-2020 4:07pm

Mad_maxx wrote: »

the market wont fall that much , you only have to look at the U.S stock market to see that covid 19 is not the threat we thought it was

the U.S stock market is the best gauge of how the irish economy is going to go in the near future , we rely completely on american corporations for strong growth

The US stock market is off the rails. It has no connection with reality any more.

They have COVID, massive unemployment, trade wars and riots all the while the stock market is bouncing along happily.

errlloyd · 05-06-2020 4:14pm

Padre_Pio wrote: »

The US stock market is off the rails. It has no connection with reality any more.

They have COVID, massive unemployment, trade wars and riots all the while the stock market is bouncing along happily.

It's like a huge Ponzi scheme that their government keeps buying shares in. It's hilarious.

Assetbacked · 05-06-2020 4:27pm

errlloyd wrote: »

It's like a huge Ponzi scheme that their government keeps buying shares in. It's hilarious.

It's absolutely insane. The Fed's QE has just gone straight into fuelling the bubble even further, with corporate bond funds receiving mass inflows in the past few weeks as well as companies have sought to take on even more debt. Interest rates are going to go negative without doubt at this stage and we will be caught in a deflationary spiral once the economic correction is allowed to finally settle in.

I mean, the Fed is piling into the whole thing which is just completely bonkers and throws the fundamentals out the window. It is pathetic to see companies crying out for cash from the Fed due to their own recklessness and seeing the Fed bail everything out like a rich dad who just underwrites his spoilt kid's lifestyle. It's also not sustainable but to be honest it's hard to see where the chips will fall once the Fed backs off from underwriting the supposed free market.

Assetbacked · 05-06-2020 4:28pm

errlloyd wrote: »

It's like a huge Ponzi scheme that their government keeps buying shares in. It's hilarious.

It's absolutely insane. The Fed's QE has just gone straight into fuelling the bubble even further, with corporate bond funds receiving mass inflows in the past few weeks as well due to companies seeking to take on even more debt. Interest rates are going to go negative without doubt at this stage and we will be caught in a deflationary spiral once the economic correction is allowed to finally settle in.

I mean, the Fed is piling into the whole thing which is just completely bonkers and throws the fundamentals out the window. It is pathetic to see companies crying out for cash from the Fed due to their own recklessness and seeing the Fed bail everything out like a rich dad who just underwrites his spoilt kid's lifestyle. It's also not sustainable but to be honest it's hard to see where the chips will fall once the Fed backs off from underwriting the supposed free market.

wassie · 05-06-2020 4:36pm

ELM327 wrote: »

You should not have more than 100k on deposit in the same bank.

The only advantages to having cash on deposit are:
-if less than 100k, covered by state guarantee...

I would suggest if he loses his 110K because BoI go bust, then the whole country is in trouble!

Property Market 2020

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