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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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Assetbacked

Top Dog wrote: »

Ah here. She's been in Germany 23 years, with steady work, but somehow she's still renting?!

It is common to rent for a long term in Germany. This is a consequence of institutional investors such as pension funds owning the property. They seek a wealth preservation with stable occupation.

In Ireland we have individual landlords crying about changing curtains or changing the paint colour in an apartment. It's outragoues and completely OTT control which you don't get with a pension fund as your landlord who just want occupation. Far better for most parties to have institutional landlords here, we just need Irish politicians to ask the Germans how to implement it.

Hubertj

neutral guy wrote: »

Nice one

“The quality of life that I have here is higher than I would have in Ireland. My rent here is so low its a joke. I’m about to move into a 90 square metre [just under 1,000sq ft] apartment for €950 per month with my boyfriend and dogs. It’s three times what I’m paying now and three times less than I’d pay back home.”

https://www.irishtimes.com/business/work/my-rent-here-is-so-low-it-s-a-joke-1.4298379

That how everything is starting guys !
Media preparing you for changes in Ireland

https://www.independent.ie/business/personal-finance/mortgage-lending-hit-lowest-level-on-record-in-may-amid-covid-19-lockdown-39357189.html

Properties still flying above asking ? No problem this will be "fixed" soon !

Why wouldn’t mortgage lending be low in may? During a pandemic. What would you expect? I thought you didn’t believe the media as it was all lies? If so why do you just post links to newspaper articles? If things are going to get so bad which bank will give you a mortgage to purchase a property? If you’re a carpenter will you have a job?

neutral guy

Hubertj wrote: »

Why wouldn’t mortgage lending be low in may? During a pandemic. What would you expect? I thought you didn’t believe the media as it was all lies? If so why do you just post links to newspaper articles? If things are going to get so bad which bank will give you a mortgage to purchase a property? If you’re a carpenter will you have a job?

Personally I think there will be further actions against land lords in Ireland.This "German story" appeared not just for "fun".The media try create " opinion".As I said before all money which been given by government will have to be paid back.

I changed my job in 2019 in less affected area getting prepared to recession.I knew about recession coming in 2017.

I have additional incomes and during last recession I made a lot more money than doing carpentry.Trough this recession I gonna do the same with bigger amount of money what will give me better profit I hope.

Always hope for good and prepare for worse.

Reversal

Hubertj wrote: »

Why wouldn’t mortgage lending be low in may? During a pandemic. What would you expect? I thought you didn’t believe the media as it was all lies? If so why do you just post links to newspaper articles? If things are going to get so bad which bank will give you a mortgage to purchase a property? If you’re a carpenter will you have a job?

Well if it was just because of lockdown why did mortgage approvals take a further harp decline in May and June compared to march and April?

riclad

It could take 2 years to create a vaccine. There, s no end in sight to the covid crisis in America.
Many hospitals are 90 per cent full dealing with new case, s . They are running low on basic ppe equipment.
The longer the crisis continues the more it will effect the economy here.
1000,s of jobs in tourism here are at risk as there's very few people travelling on planes at the moment.
Some people may choose to wait and see if prices fall more before buying any property

riclad

Villa05

Hubertj wrote:

Why will investment properties flood the market? People are Saying mortgage payments can be 50% less than rents? What am I missing?

Who rents
Whom are most affected by the recession
Who will pay their high rents when their job is gone
Who will pay the rent for the closed or half capacity business
90% of small business rent there premises

fliball123

Villa05 wrote: »

Who rents
Whom are most affected by the recession
Who will pay their high rents when their job is gone
Who will pay the rent for the closed or half capacity business
90% of small business rent there premises

And yet people still need to live somewhere you cant run away from the virus

Hubertj

Reversal wrote: »

Well if it was just because of lockdown why did mortgage approvals take a further harp decline in May and June compared to march and April?

Because of a global pandemic, people on wage subsidy etc, consumer sentiment. That’s my point, it’s no surprise there was a significant decrease.

Hubertj

Villa05 wrote: »

Who rents
Whom are most affected by the recession
Who will pay their high rents when their job is gone
Who will pay the rent for the closed or half capacity business
90% of small business rent there premises

My point\question is that when rents fall they will still be higher than mortgage payments if there is a 50% difference. Or was 1 of the experts on here spoofing when they said that? Are rents going to fall by more than 50%?

And if someone isn’t going to rent where will they live? Social housing? Oh wait....

Assetbacked

fliball123 wrote: »

And yet people still need to live somewhere you cant run away from the virus

But remember, travel is massively curtailed until it looks like early next year at the earliest. Evictions cannot occur during the protection period as well. There is perhaps an expectation that arrears can be claimed but if someone is looking for an eviction deferral you won't get any arrears out of them.

If people needed somewhere to live and therefore there is perpetual demand for propertiee we would never have boom and bust in property. It is such a moot point to make in the context of prices rising and falling.

Assetbacked

Hubertj wrote: »

My point\question is that when rents fall they will still be higher than mortgage payments if there is a 50% difference. Or was 1 of the experts on here spoofing when they said that? Are rents going to fall by more than 50%?

And if someone isn’t going to rent where will they live? Social housing? Oh wait....

Well they can't be evicted so they live rent free in the property.

Ozark707

Hubertj wrote: »

My point\question is that when rents fall they will still be higher than mortgage payments if there is a 50% difference. Or was 1 of the experts on here spoofing when they said that? Are rents going to fall by more than 50%?

It looks like rents have come back now ~17% since covid struck (that is based on the stats from the propertypin). You might be able to get another couple of % off as well from the asking where I think 6 months ago you would have been laughed at if you requested it.

Will rents continue to drop? I really am in two minds on this. One part is that they will continue to drop as more people start to leave Dublin and also that it looks like 3rd level will only be back at 50% this autumn but on the other hand I think many who left Ireland in early March will start to come back in September.

I have had to make some trips to parts of Dublin I had not visited in a long while, I was very surprised by the amount and size of some developments which are in the works (e.g. Clancy Quay near Heuston Station). It will be interesting to see if they look to command the same rents as before.

smurgen

fliball123 wrote: »

And yet people still need to live somewhere you cant run away from the virus

Lot of foreign workers came here. Lot of them will go home now. So no,they don't need to live in Ireland.

Bass Reeves

neutral guy wrote: »

Personally I think there will be further actions against land lords in Ireland.This "German story" appeared not just for "fun".The media try create " opinion".As I said before all money which been given by government will have to be paid back.

I changed my job in 2019 in less affected area getting prepared to recession.I knew about recession coming in 2017.

I have additional incomes and during last recession I made a lot more money than doing carpentry.Trough this recession I gonna do the same with bigger amount of money what will give me better profit I hope.

Always hope for good and prepare for worse.

4-6 years back when legislation was approved for Reit's we heard they would be the dogs ballo#. They force rents down and wipe out smaller landlords. Most Reit's are as or more expensive than original investment landlords. I predicted this at that time.

Pension investment funds in Germany etc have these buildings for decades, as well often tenants responsible for maintaining the property. Most local taxes are payable by tenant rather than LL, generally it a different environments with easier eviction in case of non-payment and better recourse in case of damage.

As I have said before no two recessions are the same. I have weathered 2 really bad ones and 2-4 other economic downturns.

If you look at it lads predicting a collapse are flipping and flopping all over the place, rents are too high for tenants, if they drop 10&20%, you see an exit of LL"s, Reit's are the way that renting will go, Reit's will go bankrupt, tenants will stop paying rents because of no eviction threat. Jobs are going all over the place and people will not be able to get mortgage's but they will be unaffected.

Bla, bla,bla,...........

Assetbacked

That being said, Eoin O'Broin is most likely writing housing policies that will be implemented in Ireland in the next 5 years. We all better familiarise ourselves with his book!

Bass Reeves

Assetbacked wrote: »

That being said, Eoin O'Broin is most likely writing housing policies that will be implemented in Ireland in the next 5 years. We all better familiarise ourselves with his book!

If commercial building slows down and I expect it will, I can see house building increase and as well I can see a substantial social and affordable house building take place.

Assetbacked

Bass Reeves wrote: »

If commercial building slows down and I expect it will, I can see house building increase and as well I can see a substantial social and affordable house building take place.

It's low hanging fruit for the new government to stimulate the homebuilding and the social homebuilding sector. Helps housing and encourages economic activity. The tripartite government know that the majority of the public are not in a worse position due to covid so still have the luxury of expecting their reasons to vote to be listened to (ie housing and health). They need to get on with it!

If commercial building slows, there'll be plenty of labour ready and rearing to build homes instead.

Bass Reeves

Assetbacked wrote: »

It's low hanging fruit for the new government to stimulate the homebuilding and the social homebuilding sector. Helps housing and encourages economic activity. The tripartite government know that the majority of the public are not in a worse position due to covid so still have the luxury of expecting their reasons to vote to be listened to (ie housing and health). They need to get on with it!

If commercial building slows, there'll be plenty of labour ready and rearing to build homes instead.

I agree it's low hanging fruit. I also agree with the government's/ central bank reluctance to encourage inflation within the sector by changing loan guidelines over the last 2-3 years. While Dublin may see a small correction prices in the rest of the country are not above building costs.

Villa05

Hubertj wrote:

And if someone isnâ€™t going to rent where will they live? Social housing? Oh wait....

And where is the endgame?

The State is up to its eyeballs in debt.

Rents were very challenging at the start of the year, what will lock down and prolonged social distancing do

Small business and large bricks and mortar retail will become unviable
Rents will have to drop significantly or else we are in for mass closures,

WFH puts pressure on office stock

Mass closures leads to mass job losses for rent paying tenants.
Where will the state get the money to support further hap applicants

kippy

JimmyVik wrote: »

If I see drops of 10% thats my trigger point.
Im buying then, if there is any supply. Too long have I waited Time to get off the fence

Prices would have been 10 percent lower than now two or three years ago depending on area. Why didn't you buy then?

Bass Reeves

kippy wrote: »

Prices would have been 10 percent lower than now two or three years ago depending on area. Why didn't you buy then?

When house prices were 30-50% lower in 2011 lads taught they would go lower, when prices started to rise after that they were convinced that there would be a double dip. It was obivious from late 2012 that this would not happen but people who missed the boat refused to buy as they taught rents would remain low. Now they have paid 4-8 years rent and are still looking for that bargain

smurgen

Bass Reeves wrote: »

When house prices were 30-50% lower in 2011 lads taught they would go lower, when prices started to rise after that they were convinced that there would be a double dip. It was obivious from late 2012 that this would not happen but people who missed the boat refused to buy as they taught rents would remain low. Now they have paid 4-8 years rent and are still looking for that bargain

Meh.in the meantime maybe the switched jobs in different places to get higher pay. Sound like sour grapes in here now prices are falling.oh well!

fliball123

smurgen wrote: »

Lot of foreign workers came here. Lot of them will go home now. So no,they don't need to live in Ireland.

Lot of Irish were living abroad a lot of them have come so they will need a place to live

smurgen

fliball123 wrote: »

Lot of Irish were living abroad a lot of them have come so they will need a place to live

Like the healthcare workers who came back temporarily to answer Ireland's call? Those poor folk can't get work now.

Bass Reeves

smurgen wrote: »

Meh.in the meantime maybe the switched jobs in different places to get higher pay. Sound like sour grapes in here now prices are falling.oh well!

Well if we go into the recession some are posting about switching jobs and higher pay will not be in the pipeline. Why would I have sour grapes I own a house and have two rental properties none of which I intend to sell. If house fall I might buy another.....my children are of house buying age. I have posted that while there may be a price drop it will not exceed 10%.

And there is no sign of house prices falling selling prices are exceeding asking prices

Pivot Eoin

Have to disagree with those saying there is no evidence of any falling prices.

Yes we do still see high quality properties fetching their market value - that's expected with only serious buyers remaining in the June/July market after COVID Drop Offs.

However if you were looking at something that's a decent size, but requires a bit of work (Not Complete redo) then I've definitely seen drops in both selling and asking prices over the past 4-6 weeks with the market having resumed. Not gargantuan drops, but maybe 3-5% drops in asking, with far less properties being subjected to bidding wars.

I can only say this is true for the area I'm looking in which is SCD/D18 area. Been tracking all properties online since Jan and noticing both asking price drops on a lot of properties, as well as then seeing deals being done a good bit under asking on lots of sold properties going up on the PPR every Wednesday.

I'm not necessarily saying this is going to be indicative of a wider trend, but people saying that across the board prices are remaining the same are probably not looking at most areas in detail. There are drops, just depends what you want.

GreeBo

Villa05 wrote: »

The best advise I got when I was buying was to look at houses that were built during a recession as the buyers were scarce the quality had to be good to achieve a sale
The opposite is the case during a boom. Throw up anything and the buyer will come to you

Ah so you did but eventually, I presume at the exact bottom of the market? Would be interested to know what metrics you used to decide when it was ok to buy?

That advice is as useless as it is generic. I'm not bit a house built in the 80s over one built last year.

I also think you misunderstood what I mean by "bad house"!

Villa05

GreeBo wrote:

I also think you misunderstood what I mean by "bad house"!

Maybe you also, you can buy a bad house anytime. I just think it's less likely when there are less buyers and more choice within your budget.

In a heated market the seller dictates the terms and vice versa

Logic and common sense really

The Belly

Bass Reeves wrote: »

When house prices were 30-50% lower in 2011 lads taught they would go lower, when prices started to rise after that they were convinced that there would be a double dip. It was obivious from late 2012 that this would not happen but people who missed the boat refused to buy as they taught rents would remain low. Now they have paid 4-8 years rent and are still looking for that bargain

In 2011 getting a mortgage was not easy there were only 13,000.

It doesn't show how many applicants were turned down but i assume the numbers were high. As lending had all but dryed up.

Cash investors, Vulture funds and the local authoritys bought up a lot of the apartments and starter houses in prime locations I think it was around half of all resedential property sold between 2009-2013 according to UCD report.

When prices did start to move and rents increase the CB brought in the new rules which, althought the banks agreed some form of cap should be introduced they felt the 3.5 was overkill given the direction the market was going.

MABS had concerns too and they were right.

Debt advisory agency Mabs expressed concern that “ the rising cost of rent and the consequential limits on what renters can save towards a deposit, may mean that renters with a solid income who could afford a mortgage will not be able to save the full deposit of 20per cent in a reasonable period of time”

I dont think it was a refusal to buy.

I think by the time a lot of people were in a position to buy due to the above activty and rules introduced it started to go beyond peoples means.