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Irish Property Market 2020 Part 2

Graham

Continued from here:

https://www.boards.ie/vbulletin/showthread.php?t=2058041687

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Iceman29 wrote: »

Yes, I've seen loads to be honest. Also seeing a lot of EAs taking down ads and relisting them at a much lower price to avoid the arrows

I've been keeping a spreadsheet of 30+ houses for the last 4 months, as we were ready to start bidding when this crisis hit. Have been checking every week to see if any reductions occurred. This week there was a lot of movement, maybe 11 are now Sale Agreed, 2 sold, but for the first time ever I have seen asking price drops - just a few, but significant. One house I was watching went from 595k - 545k, another with a 25k drop, another with 65k drop (that one was way out of budget

)

This is only anecdotal of course, and a small sample.

JJJackal

brisan wrote: »

The amount of mortgages banks approved in April and may were at record lows both in volume and value .
I know this had a lot to do with covid payments etc ,but when they stop and the real unemployment rate emerges then banks will be extremely cautious and mortgages will be hard to get .
Credit availability will be a major factor in house prices going forward

I suspect its also due to the fact that you couldnt go to the bank as easily...

Or get the mountain of paper work complete (who in hr would supply you with details of pay etc)

Or go to a mortgage broker

With the reduced pay a significant contributor too

CBear1993

This reduction in house prices is Good for house buyers surely, and people looking to add to their property portfolio, but is it also a sign that we are entering an economic downturn/recession? Temporarily or long term I don’t know.... was talking to the estate agent I bought my apartment in Dublin through last week and he was anticipating a dip but didn’t know for how long.

CBear1993

I’m asking btw! Wouldn’t pretend to have any clue about economics or property. Was a first time buyer last year and thinking long term . Say 18 months - 2 years of buying a proper house and selling the apartment.

Assetbacked

CBear1993 wrote: »

This reduction in house prices is Good for house buyers surely, and people looking to add to their property portfolio, but is it also a sign that we are entering an economic downturn/recession? Temporarily or long term I don’t know.... was talking to the estate agent I bought my apartment in Dublin through last week and he was anticipating a dip but didn’t know for how long.

Property prices are strongly linked to the general economic sutuation.

This is an uncertain and bizarre economic situation. Central banks are pumping cash into the economic system to prop up the typically rolled out stats used to define a country's prosperity rather than it being necessarily reflective of the real economy.

The pandemic rages on so some people are in a terrible financial position, others in a good position and others unchanged. There is still great uncertainty as to where it ends.

In terms of actual data which may assist with developing a view on the economy and where it may end up, it is worth highlighting that the big banks in the US this week outlined that they have made provision for billions of bad loan losses, MNCs in Ireland (a significant source of corporate tax revenue, jobs and indirect taxation contributions to Ireland) were given a massive boost with the General Court decision today, Brexit is looming which probably presents an opportunity in terms of Irish assets, the US stock market is catastrophically tilted in favour of a few massive tech stocks, job losses have been announced across retail and airline industries in Ireland in recent weeks, students won't be back on campus for at least another 6 months. All of this is just part of the wider economic picture which feeds into the property market. In the Irish context we had SF make a lot of progress in the last election because the FF and FG governments have neglected the younger people with respect to housing.

All of the above are on my radar and form part of my overall economic outlook which feeds into a macro property market view. But I have a bias, as we all do on
Boards.ie; I rent but do not have strong wish to buy or even stay in Ireland long term and my parents are downsizing so looking to cash in on their house.

There are segments of the housing market in Ireland that should be viewed as segments. Eg new builds under 600k, South Dublin semis over 1.2m, 250k apartments in Castle knock etc. Some will fare okay but others won't.

I would stock up on savings and clear debt if I was relying on a salary for a living in these pressing times. That is my net position.

Queenio

I have tentatively gone sale agreed today for 15k under asking. Solicitor actually congratulated me. He said it's the first sale he had seen in many weeks that went below asking. House in south city dublin. I will admit I was surprised

Assetbacked

Queenio wrote: »

I have tentatively gone sale agreed today for 15k under asking. Solicitor actually congratulated me. He said it's the first sale he had seen in many weeks that went below asking. House in south city dublin. I will admit I was surprised

Happy for you, enjoy the security and sense of accomplishment! Well deserved I'm sure.

MrMusician18

Was out for a walk last night and passed that half a house in Churchtown. Couldn't believe it's gone sale agreed.

There is literally a buyer for anything.

Villa05

Assetbacked wrote:

Central banks are pumping cash into the economic system to prop up the typically rolled out stats used to define a country's prosperity rather than it being necessarily reflective of the real economy.

Very good summary
Central banks have been pumping the system with cash for the last decade but it only appears to be pumping up asset prices especially USA
Our GDP figures are a con based on plus they were significantly added to by aircraft leasing, which would be a non existent in the current environment

With regard to Corporation tax, irl Inc won the battle but the decision has stepped up the war. The EU are going for us and who could blame them. They are looking at Irish solutions in getting around the laws to solve an EU problem.

BOD1981 wrote:

While we are happy to get the monkey off our back there is mixed feelings on my part, we really needed to get this over the line as time is not on our side but i can't help but think if i was 5-10 years younger i could wait it out a year or two and really get a good deal which would help set us up financially as we are borrowing pretty much near max capacity with this deal.

Thrust me you get the same feeling in 2014. From your limited info, I think you made the right decision. I would agree that younger people should wait it out as they are the people that suffer most in recessions especially the way the Labour Market is set up here

Newbie20

From what I have seen, a lot of solicitors are telling their clients to bid approx €20,000 lower after they have gone sale agreed (well people that were gone sale agreed prior to COVID kicking off)
I know of 3 people that were told this by solicitors.
Person 1 came back to the vendor and said they were offering 20 grand less and they were told to feck off and the sale fell through
Person 2 did the same but they were told no and that if they still offered the original it was theirs so they did and the sale is going through
Person 3 decided not to take the solicitors advice and left it as it was and they are in the house and all now.

I think situations like Person 1 that I mentioned above are contributing to some of the houses being taken off the market.

Cantstandsya

Newbie20 wrote: »

From what I have seen, a lot of solicitors are telling their clients to bid approx €20,000 lower after they have gone sale agreed (well people that were gone sale agreed prior to COVID kicking off)
I know of 3 people that were told this by solicitors.
Person 1 came back to the vendor and said they were offering 20 grand less and they were told to feck off and the sale fell through
Person 2 did the same but they were told no and that if they still offered the original it was theirs so they did and the sale is going through
Person 3 decided not to take the solicitors advice and left it as it was and they are in the house and all now.

I think situations like Person 1 that I mentioned above are contributing to some of the houses being taken off the market.

Houses will be taken off the market under the assumption/hope that things will be back to normal in a couple of months.

They won't be. Cases are going back up and exit from lockdown is being slowed down/reversed. There is no end in sight to this so if people need to sell or want to move then they're gonna have to accept reality.

I completely understand people being reluctant to accept their asset is now worth significantly less but that's how it is. Where I am looking I have enquired about numerous houses and 80% of them have received zero bids whatsoever, never mind low ball bids.

Yeah, some areas in Dublin or Cork might be holding out as demand there remains high but the writing is on the wall.

fliball123

Cantstandsya wrote: »

Houses will be taken off the market under the assumption/hope that things will be back to normal in a couple of months.

They won't be. Cases are going back up and exit from lockdown is being slowed down/reversed. There is no end in sight to this so if people need to sell or want to move then they're gonna have to accept reality.

I completely understand people being reluctant to accept their asset is now worth significantly less but that's how it is. Where I am looking I have enquired about numerous houses and 80% of them have received zero bids whatsoever, never mind low ball bids.

Yeah, some areas in Dublin or Cork might be holding out as demand there remains high but the writing is on the wall.

There is still a chronic under supply of property, there is still strong demand in the REITS alone for new builds once these 2 factors are at play prices are not going down

Graham

Cantstandsya wrote: »

I completely understand people being reluctant to accept their asset is now worth significantly less but that's how it is.

But it's not.

At least not right now.

cnocbui

Cantstandsya wrote: »

Houses will be taken off the market under the assumption/hope that things will be back to normal in a couple of months.

They won't be. Cases are going back up and exit from lockdown is being slowed down/reversed. There is no end in sight to this so if people need to sell or want to move then they're gonna have to accept reality.

I completely understand people being reluctant to accept their asset is now worth significantly less but that's how it is. Where I am looking I have enquired about numerous houses and 80% of them have received zero bids whatsoever, never mind low ball bids.

Yeah, some areas in Dublin or Cork might be holding out as demand there remains high but the writing is on the wall.

And what area is it you are looking at where there is no interest?

Cantstandsya

Graham wrote: »

But it's not.

At least not right now.

Bank valuers and solicitors disagree with you.

Cantstandsya

fliball123 wrote: »

There is still a chronic under supply of property, there is still strong demand in the REITS alone for new builds once these 2 factors are at play prices are not going down

Do REITs buy many second hand houses outside of Dublin/Cork?

Supply is of secondary importance to credit. Oversupply didn't dent prices during the boom because of easy credit and under supply won't keep them up now because of less credit.

awec

Cantstandsya wrote: »

Bank valuers and solicitors disagree with you.

Solicitors are not an authority or experts on the value of houses.

SozBbz

Cantstandsya wrote: »

Bank valuers and solicitors disagree with you.

I didnt know that bank valuers (also known as estate agents) and solicitors have a common spokesperson.

Cal4567

Newbie20 wrote: »

From what I have seen, a lot of solicitors are telling their clients to bid approx €20,000 lower after they have gone sale agreed (well people that were gone sale agreed prior to COVID kicking off)
I know of 3 people that were told this by solicitors.
Person 1 came back to the vendor and said they were offering 20 grand less and they were told to feck off and the sale fell through
Person 2 did the same but they were told no and that if they still offered the original it was theirs so they did and the sale is going through
Person 3 decided not to take the solicitors advice and left it as it was and they are in the house and all now.

I think situations like Person 1 that I mentioned above are contributing to some of the houses being taken off the market.

Solicitors acting as if they are wheeler dealers. I'd just prefer if they can confirm it has clear Title, you know, their actual job.

Brianmwalker

awec wrote: »

Solicitors are not an authority or experts on the value of houses.

Close the thread so cause no one here is either

awec

Brianmwalker wrote: »

Close the thread so cause no one here is either

Correct, nobody here is either. Your solicitor is no more of an expert on house valuations than some random, nameless person on here.

Cyrus

Brianmwalker wrote: »

Close the thread so cause no one here is either

the only information that is relevant is what the bloody things are selling for,

if there is a wholesale decrease in selling prices itll show up pretty soon,

how about we just skip the nonsense anecdotes

Cantstandsya

awec wrote: »

Solicitors are not an authority or experts on the value of houses.

I've been reading this thread enough to know that nobody is an authority on anything unless they agree with what people already think.

Graham

Cantstandsya wrote: »

Bank valuers and solicitors disagree with you.

Solicitors?? I'll take their opinion on property prices under advisement :pac:

You'd think if bank valuations were being pushed down we'd have dozens of posts about it.

Cyrus

Graham wrote: »

Solicitors?? I'll take their opinion on property prices under advisement :pac:

You'd think if bank valuations were being pushed down we'd have dozens of posts about it.

thomas byrne says hi :pac:

Cantstandsya

Graham wrote: »

Solicitors?? I'll take their opinion on property prices under advisement :pac:

You'd think if bank valuations were being pushed down we'd have dozens of posts about it.

I guess all those newspaper articles reporting lower bank valuations back in May and the Daft report showing reduced asking prices in June were all lying then.

Graham

Cyrus wrote: »

thomas byrne says hi :pac:

I asked him. He denied it.

Graham

Cantstandsya wrote: »

I guess all those newspaper articles reporting lower bank valuations back in May and the Daft report showing reduced asking prices in June were all lying then.

Ahh you mean bank valuations from when the economy was completely closed and nothing was happening with anything, anywhere?

Bass Reeves

Newbie20 wrote: »

From what I have seen, a lot of solicitors are telling their clients to bid approx €20,000 lower after they have gone sale agreed (well people that were gone sale agreed prior to COVID kicking off)
I know of 3 people that were told this by solicitors.
Person 1 came back to the vendor and said they were offering 20 grand less and they were told to feck off and the sale fell through
Person 2 did the same but they were told no and that if they still offered the original it was theirs so they did and the sale is going through
Person 3 decided not to take the solicitors advice and left it as it was and they are in the house and all now.

I think situations like Person 1 that I mentioned above are contributing to some of the houses being taken off the market.

If I was selling and a buyer tried this stunt I go back to under bidder. As well if he failed to honour contract I see it as a valid reason to hold onto deposit.

Finally If I had to sell for 20k less I give an underbidder the option rather than a lad that tried that stunt at closing

fliball123

Cantstandsya wrote: »

Do REITs buy many second hand houses outside of Dublin/Cork?

Supply is of secondary importance to credit. Oversupply didn't dent prices during the boom because of easy credit and under supply won't keep them up now because of less credit.

No but they are buying a hell of a lot of new properties coming on stream, I seen a figure of 85% of new apartments are being bought up by REITS so in case you have not been here for the last number of years there is a chronic shortage of properties and even more so for properties in good condition and in high demand areas. Easy credit has not been happening for the last decade. The banks have had manners put on them by the borrowing/savings ratios along with other measures.

Regardless of whats going on demand vs supply = price virus or no virus. Demand is still there with a high % of new builds being snapped up off the plans by REITS due to the high yield in rents so the supply side is not going anywhere anytime soon. Demand may dissipate if banks stop lending but it has to come right down to meet the shortage of supply. You add in the fact that is very hard nearly impossible for a bank to take the family home when a person is in financial difficulty further suppressing supply.

Its going to be interesting to see how this plays out.