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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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DubLad69

Has anyone else noticed an increase in houses on daft being marked sale agreed in recent days?

A huge number of houses that I had been watching went sale agreed in the past week (or at least were finally marked sale agreed on daft).

I've also noticed a lot of houses on the PPR going for under asking for houses I would have expected to go for over asking. Just in my particular area of Dublin though.

Queenio

DubLad69 wrote: »

Has anyone else noticed an increase in houses on daft being marked sale agreed in recent days?
I've also noticed a lot of houses on the PPR going for under asking for houses

I've just gone sale agreed two weeks ago. I distinctly remember calling to view properties and 80%+ were sale agreed without being marked as such on daft/myhome. Very frustrating. That's interesting about them going for under asking. Our area is D6w and we have managed to go 15k under asking but many houses were getting offers at or above asking within hours / days of going on the market. What area of dublin are you looking in? Point to note : I've noticed a few of these houses have had their sale agreed status fall through but many have continued as planned from what I can gather.

lomb

TheSheriff wrote: »

I also think this is INSANE money, absolutely insane.

But, my sister-in-law just got mortgage approval and they are exclusively looking at (what I would consider) tiny two bed red bricks which are priced at eye watering guides in D6.

Wouldn't be for me, but some people love this stuff, minutes walk to rathmines/ranleagh etc. I can see the attraction; I think the premium is maddness, others may think it's worth the money ... someone already thinks its worth 485k!!!!!

That's a shoebox. Even the other one you pointed out in castleknock is a shoebox. It's much better to try to change careers ,try to become self employed and move to the likes of Kildare. I bought a 3000sq outside Naas on an acre for 460 and it is a palace. The only pro is if houses prices hold you can get out and sell to the next ready victim. It's a big if though as we are at the end of a long upwards business cycle and that doesn't even include corona.

TheSheriff

lomb wrote: »

That's a shoebox. Even the other one you pointed out in castleknock is a shoebox. It's much better to try to change careers ,try to become self employed and move to the likes of Kildare. I bought a 3000sq outside Naas on an acre for 460 and it is a palace. The only pro is if houses prices hold you can get out and sell to the next ready victim. It's a big if though as we are at the end of a long upwards business cycle and that doesn't even include corona.

Everyone has different wants.

Personally, I would absolutely hate to live in Kildare or Naas, on half an acre of land. I wouldn't need to change career to make that move, but I simply never would.

That shoebox will suit someone. I don't think they are a victim, they will just have a different idea of whats worth their money.

brisan

Dolbhad wrote: »

Stock levels are poor at the moment. Houses seem to be going sale agreed quickly enough in Cork - even houses that have been up a few months. And I do think there are increases in price.

i had hope to sit it out for a few months to see how the market goes and because I lost my exemption worth 50k but I am under pressure in the place I rent to find somewhere else. And I say it’s more difficult to find rented accommodation.

But I think purchasers are more under pressure to buy now - if you think your job could be at risk with a recession you will get a mortgage now in case you can’t next year.

Though if I had a property to sell I would be offloading it now.

If you lose your job how do you intend to pay your mortgage back ?????????????

JeffKenna

brisan wrote: »

If you lose your job how do you intend to pay your mortgage back ?????????????

Welcome to Ireland where you don't have to!

brisan

[PHP][/PHP]

Graham wrote: »

Anecdotally I don't think we're seeing a surge of posts from people not getting approval.

Where are you getting the current approval statistics/rates?

https://www.bpfi.ie/wp-content/uploads/2020/06/BPFI-Mortgage-Approvals-Report-May-2020.pdf

GreeBo

lomb wrote: »

That's a shoebox. Even the other one you pointed out in castleknock is a shoebox. It's much better to try to change careers ,try to become self employed and move to the likes of Kildare. I bought a 3000sq outside Naas on an acre for 460 and it is a palace. The only pro is if houses prices hold you can get out and sell to the next ready victim. It's a big if though as we are at the end of a long upwards business cycle and that doesn't even include corona.

I think there is a middle ground between a cottage in ranelagh and an acre in Kildare.

GreeBo

brisan wrote: »

[PHP][/PHP]

https://www.bpfi.ie/wp-content/uploads/2020/06/BPFI-Mortgage-Approvals-Report-May-2020.pdf

Again that ignores the drop in applications, the approval rate could actually have increased.

hometruths

brisan wrote: »

If you lose your job how do you intend to pay your mortgage back ?????????????

this is a fairly common comment in this thread.

"Better to buy now whilst you have a job, because you might not have one this time next year."

Madness!

Cantstandsya

GreeBo wrote: »

Again that ignores the drop in applications, the approval rate could actually have increased.

Applications and approvals are down.

GreeBo

Cantstandsya wrote: »

Applications and approvals are down.

This is now a circular argument.
Are there any facts to support this?

Graham

Yes, from the central bank posted a few pages back:

Graham wrote: »

Thanks, interesting reading the Bank Lending Survey which I assume the article was based around.

kippy

schmittel wrote: »

this is a fairly common comment in this thread.

"Better to buy now whilst you have a job, because you might not have one this time next year."

Madness!

Is it?

[Deleted User]

TheSheriff wrote: »

That shoebox will suit someone. I don't think they are a victim, they will just have a different idea of whats worth their money.

I'd be one of those people. I grew up in a terraced cottage and then lived in rented apartments all my life so I'd have no yearning for a big house.

We were looking for a 2 bed (one bed plus a study), near Dublin city centre, in an area where you can walk most places rather than drive. At no point were we looking at the square meterage for the sake of it or trying to get extra space or extra bedrooms that we'd never do anything with.

I always feel a bit of a reality check when people on here are giving out about the housing crisis, me nodding along in agreement, and then out comes 'all I can afford is a 3-bed semi-D!"

GreeBo

Graham wrote: »

Yes, from the central bank posted a few pages back:

That shows demand falling off a cliff, I think it's hard to know the impact that had on approvals, for example maybe only poor applicants were left?

Btw I'm not saying that lending hasn't tightened, just questioning the rate/impact.

hometruths

kippy wrote: »

Is it?

yes

kippy

schmittel wrote: »

yes

I would argue that it depends completely on your situation and your appetite for housing stability.

Cantstandsya

GreeBo wrote: »

That shows demand falling off a cliff, I think it's hard to know the impact that had on approvals, for example maybe only poor applicants were left?

Btw I'm not saying that lending hasn't tightened, just questioning the rate/impact.

The impact on approvals is discussed in the survey and the article that was posted (twice) discussing it.

hometruths

kippy wrote: »

I would argue that it depends completely on your situation and your appetite for housing stability.

Whatever the motivation/logic, my point was just that the idea that if you think you are in danger of losing your job, you should go ahead and buy a house asap whilst you still have a job comes up repeatedly in this thread.

For example:

kippy wrote: »

Look. The reality is simple here. People who are in edgy situations (that is, have approval to buy but who face into uncertain times ahead) would have been daft not to try get the deal over the line ASAP.
Once you have a house, it is extremely difficult to lose it in this country (be that right or wrong).
The alternative is not buying. Paying extortionate rents, eating up savings, having to engage with DEASP for support and all the means testing that brings etc etc
These all the more compounded by the other variables involved.

kippy

schmittel wrote: »

Whatever the motivation/logic, my point was just that the idea that if you think you are in danger of losing your job, you should go ahead and buy a house asap whilst you still have a job comes up repeatedly in this thread.

For example:

Oh yeah,
I would be one of those not putting off everyone who thought they were going to be out of a job next year from buying a house.

I don't think it's a completely daft viewpoint either based on the Irish situation but obviously there are those that do.

It's good that alternate viewpoints are on this thread.

brisan

Graham wrote: »

Quarterly so I'd expect mid-October for the next one.

The Banking and Payments Federation produces monthly reports on mortgage approvals and draw downs

https://www.bpfi.ie/

Dolbhad

brisan wrote: »

If you lose your job how do you intend to pay your mortgage back ?????????????

Regardless of if you lose your job, you still need a place to live. Rent is still more expensive than a mortgage. If you lost your job and got into difficulty paying a mortgage for a few months, the banks can’t kick you out. If your renting, you can be kicked out much quicker. You will still have more security in buying a home as the rental market is crazy at moment.

I was in school for most the boom years so didn’t follow the market then but I don’t think the rental market was as bad as it is now? I wouldn’t be surprised if rent is higher now especially as people may not be earning as much.

SozBbz

Dolbhad wrote: »

Regardless of if you lose your job, you still need a place to live. Rent is still more expensive than a mortgage. If you lost your job and got into difficulty paying a mortgage for a few months, the banks can’t kick you out. If your renting, you can be kicked out much quicker. You will still have more security in buying a home as the rental market is crazy at moment.

I was in school for most the boom years so didn’t follow the market then but I don’t think the rental market was as bad as it is now? I wouldn’t be surprised if rent is higher now especially as people may not be earning as much.

Rent is definitely worse these days (or pre covid it was at least)
Back then there was a tax break on the rent you paid and generally I don't recall people living in constant fear of eviction if they ask their landlord to do something totally reasonable, like deal with a damp issue or replace a broken item.

hometruths

kippy wrote: »

Oh yeah,
I would be one of those not putting off everyone who thought they were going to be out of a job next year from buying a house.

I don't think it's a completely daft viewpoint either based on the Irish situation but obviously there are those that do.

It's good that alternate viewpoints are on this thread.

It's not really an alternative viewpoint - it seems quite mainstream!

On an individual level I understand the logic of the decision.

What I think is madness that collectively we all just shrug and think sure, that's the way it is.

We are very much an outlier in our acceptance as a society that we are happy to subsidise those who do not pay their mortgages, and it is contributing greatly to our dysfunctional property market and housing crisis.

And if you accept that it is a rational decision to take on a mortgage irrespective of your confidence in your ability to repay it, then it must also follow that it is a rational decision to simply stop paying your mortgage even if you have a job and repayment capacity.

This is happening in significant numbers, with current damaging societal consequences and storing up problems for the future.

I'll reiterate that I understand the individual's decision making process, but I cannot for the life of me work out why so many people seem to be fine with the problem as a whole.

brisan

schmittel wrote: »

It's not really an alternative viewpoint - it seems quite mainstream!

On an individual level I understand the logic of the decision.

What I think is madness that collectively we all just shrug and think sure, that's the way it is.

We are very much an outlier in our acceptance as a society that we are happy to subsidise those who do not pay their mortgages, and it is contributing greatly to our dysfunctional property market and housing crisis.

And if you accept that it is a rational decision to take on a mortgage irrespective of your confidence in your ability to repay it, then it must also follow that it is a rational decision to simply stop paying your mortgage even if you have a job and repayment capacity.

This is happening in significant numbers, with current damaging societal consequences and storing up problems for the future.

I'll reiterate that I understand the individual's decision making process, but I cannot for the life of me work out why so many people seem to be fine with the problem as a whole.

Pamela flood and her husband thought this ,as did a number of other high profile people

hometruths

brisan wrote: »

Pamela flood and her husband thought this ,as did a number of other high profile people

Exactly, and it has worked out just fine for most of them. And we only hear about the high profile ones, tens of 1000s of others happily living for free whilst the rest of us pay for it.

Many of these people got 100% or 110% mortgages so their housing has never actually cost them anything.

It will continue as long as there is safety in numbers and it remains a rational decision - i.e the rewards outweigh the risks.

MacronvFrugals

schmittel wrote: »

It's not really an alternative viewpoint - it seems quite mainstream!

On an individual level I understand the logic of the decision.

What I think is madness that collectively we all just shrug and think sure, that's the way it is.

We are very much an outlier in our acceptance as a society that we are happy to subsidise those who do not pay their mortgages, and it is contributing greatly to our dysfunctional property market and housing crisis.

And if you accept that it is a rational decision to take on a mortgage irrespective of your confidence in your ability to repay it, then it must also follow that it is a rational decision to simply stop paying your mortgage even if you have a job and repayment capacity.

This is happening in significant numbers, with current damaging societal consequences and storing up problems for the future.

I'll reiterate that I understand the individual's decision making process, but I cannot for the life of me work out why so many people seem to be fine with the problem as a whole.

Every part of Irish society believes it -

https://www.independent.ie/irish-news/rte-stars-judges-and-rugby-elite-who-owe-anglo-millions-29887499.html#:~:text=RUGBY%20players%2C%20RTE%20stars%2C%20musicians,the%20former%20Anglo%20Irish%20Bank.

awec

schmittel wrote: »

It's not really an alternative viewpoint - it seems quite mainstream!

On an individual level I understand the logic of the decision.

What I think is madness that collectively we all just shrug and think sure, that's the way it is.

We are very much an outlier in our acceptance as a society that we are happy to subsidise those who do not pay their mortgages, and it is contributing greatly to our dysfunctional property market and housing crisis.

And if you accept that it is a rational decision to take on a mortgage irrespective of your confidence in your ability to repay it, then it must also follow that it is a rational decision to simply stop paying your mortgage even if you have a job and repayment capacity.

This is happening in significant numbers, with current damaging societal consequences and storing up problems for the future.

I'll reiterate that I understand the individual's decision making process, but I cannot for the life of me work out why so many people seem to be fine with the problem as a whole.

I think you're misrepresenting it here a bit.

I would imagine that the number of people who take out mortgages when they know they won't be able to repay it is something around zero.

The reality is that people on shaky ground may take out a mortgage in the knowledge that they are not 100% sure on their employment status in the next year. But these people are thinking that they aren't going to be certain of employment for 3 or 4 years, and that's a long time to wait. They are thinking that they may not get a mortgage next year, even if there's no change in their employment status.

The majority that do this will end up just fine, they'll keep their job or they'll have salary cuts but the mortgage will continue to be serviced. Some will roll the dice and end up unlucky and out of the job. The majority that end up unlucky will go into mortgage arrears, eventually get employment again and work to clear off the mortgage.

Marius34

GreeBo wrote: »

That shows demand falling off a cliff, I think it's hard to know the impact that had on approvals, for example maybe only poor applicants were left?

Btw I'm not saying that lending hasn't tightened, just questioning the rate/impact.

I looked at the detailed survey results.
They question the banks opinion which they should provide answer:
1 - Decreased considerably
2 - Decreased somewhat
3 - Remained basically unchanged
4 - Increased somewhat
5 - Increased considerably.

To question on household Loan application rejection, it scored 3.6 Meaning some banks answered "Remained basically unchanged", others "Increased somewhat".

To question on demands for loans for house purchase it scored 1.2 Meaning vast majority of banks answered that "Decreased considerably".

I believe it was well expected that overly Loan Approvals will go down significantly during the lock down, as it could be expected that it will increase from the May low.