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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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sheepskin1234

Pelezico wrote: »

Sweeping generalisations and a couple of one liners. Amusing but hardly inspiring.

Yeah that's all he is tbh.

Nearly every piece he does, podcast or whatever, he tries to introduce a new word or concept and then everyone thinks he's a genius.

I remember months back in March or April he said we should give helicopter money. Then after this we saw people parrot it, even incorrectly!

I remember seeing people criticise the 350/week payment and then all those who drank the kool aid were saying "it's helicopter money!" The 350 was to sustain people, not increase economic activity in a ****ing lockdown. haha

MacronvFrugals

Hubertj wrote: »

There is a lot of hypocrisy in Europe though. France has Monaco, other large countries use Luxembourg and Switzerland , UK uses Channel Islands and Isle of Man, us use caymans etc. Ireland doesn’t have luxury of offshoring its tax ‘avoidance’ measures.

In fairness its only really Ireland/Netherlands/Luxembourg acting as tax havens for US MNCs

https://www.cfr.org/blog/could-trade-agreements-help-limit-tax-competition

Mic 1972

HotDudeLife wrote: »

FWIW, the areas i have quickly "researched" (D7, D11, D12) all seem to be dropping in both asking and sales prices.
.

D7 isn't dropping, i check it daily
in the last 2-3 week some very expensive apartments have been added. Asking prices are through the roof in the area

GreeBo

PropQueries wrote: »

I don't think they gave them significant discounts on the actual build cost. A-rated 3 bed homes today only cost between €110k - €150k to build and most council homes were so cheaply built, they couldn't have cost more than €20k to build at the time.

do you have a link to those costs for A rated homes? That looks far cheaper than I would expect.

Geuze

A 1960s semiD in a nice area of Salthill made 691k.

Was asking 595k.

Madness.

The_Conductor

Geuze wrote: »

A 1960s semiD in a nice area of Salthill made 691k.

Was asking 595k.

Madness.

Doesn't matter what they were selling- people were buying the location.
Salthill commands these prices- its the D4 of Galway (and indeed is more expensive than several D4 neighbourhoods in Dublin).

awec

GreeBo wrote: »

do you have a link to those costs for A rated homes? That looks far cheaper than I would expect.

It's because he's being deliberately disingenuous, and only calling out one part of the cost.

PropQueries

GreeBo wrote: »

do you have a link to those costs for A rated homes? That looks far cheaper than I would expect.

Here you go in the SCSI report in July 2020 "The Real Cost of New Housing Delivery" published in July 2020, they put the cost of building a 114 sq.m. home at €371,311, split between €178,902 hard costs and €192,409 soft costs.

Link to SCSI report here: https://www.scsi.ie/documents/get_lob?id=1551&field=file

The above is an average of build costs between small and large developers. My understanding is that Cairn Homes build their A-rated 3-bed semis for under €120k as they have scale. A terraced a-rated home e.g. an A-rated version of an ex-corporation house should probably cost well less than €110k to build.

PropQueries

awec wrote: »

It's because he's being deliberately disingenuous, and only calling out one part of the cost.

If they're built by the council as they were in the past, they shouldn't have all the so-called 'soft costs' e.g. land, marketing, finance costs (government borrowing costs are currently zero or less) etc. etc.

So, not "being deliberately disingenuous".

awec

PropQueries wrote: »

If they're built by the council as they were in the past, they shouldn't have all the so-called 'soft costs' e.g. land, marketing, finance costs (government finance costs are currently zero) etc. etc.

So, not "being deliberately disingenuous".

Right, so when you said "it costs 100-150k to build an A rated 3 bed house", what you really meant to say was if you don't have to pay for land or finance or marketing or legal or taxes any other soft cost, and you need to make absolutely no profit whatsoever then it's possible.

That is to say, it is not at all the norm to build an a rated 3 bed house for this money.

PropQueries

awec wrote: »

Right, so when you said "it costs 100-150k to build an A rated 3 bed house", what you really meant to say was if you don't have to pay for land or finance or marketing or legal or taxes any other soft cost then it's possible.

That is to say, it is not at all the norm to build an a rated 3 bed house for this money.

The debate was on the cost of building council houses, not houses for sale to the private market.

handlemaster

Its Hard to see that prices will not drop.
Covid 19 is not going away for at least another year. Even if a vaccine were found today.
The government will not be able to continue to give out money for nothing. The business association are staying we are looking at 50 billion in covid costs.. This is enormous. all this has to be paid back. We are losing jobs , where will the money for the house buyers come from ? Cash buyers are only a small part of the property market the rest are borrowing. It is the new entrants to the market the first time buyers that keep the show on the road and they are most likely to be lower earners and more likely to be impacted with reduced hours and loss of employment.

awec

PropQueries wrote: »

The debate was on the cost of building council houses, not houses for sale to the private market.

Even so, councils will not be able to waive all of the other costs.

PropQueries

awec wrote: »

Even so, councils will not be able to waive all of the other costs.

Breakdown of Soft Costs:

Professional Fees: €5,650
Levies: €13,984
Land and Acquisition Costs: €60,823
Sales, Marketing and Legal Fees: €8,400
Finance Costs: €16,716
Margin: €42,671
VAT: €44,165

Total Soft Costs: €192,409

I would assume most, if not all, of these could be cut for council houses? If the council and government really wanted to of course.

In Portlaoise, private developers are asking €212,000 for 92sq.m. A-rated 3-bed semis. I'm sure the council (if they wanted to) could easily build terraced a-rated council houses on state land in Dublin for half those asking prices.

Link to MyHome here: https://www.myhome.ie/residential/brochure/202-16-clonkeen-view-bellingham-portlaoise-laois/4401935

Browney7

awec wrote: »

Even so, councils will not be able to waive all of the other costs.

The facts are if the council's can outsource the bricks and mortar and materials and labour plus a margin for the builder or the developer, they could get a house built on its land for an amount in the low 200s.

There's no joined up thinking going on here (whether it's being deliberate or just through sheer lack of foresight). Look at the RTE site, the council are going to buy 10% of the properties at very high prices (472k for a one bed and 521k for a 2 bed). Why didn't the state just keep 10% of the site (RTE is state owned after all) and strike a deal with a builder to build the units on their piece of the site for far below what they are going to pay Cairn even including the "discount" on open market selling prices.

The yield to maturity on Irish 10 year debt is negative and if you go out to 20 and 30 years on the curve it's below 1% p.a. so financing costs are negligible also.

IK09

Hey guys,

What is the website that Ive seen here before where people can check the purchase price of a property?

Get Real

Mic 1972 wrote: »

D7 isn't dropping, i check it daily
in the last 2-3 week some very expensive apartments have been added. Asking prices are through the roof in the area

Agree. Also, rent prices, plenty of single rooms for 600 and doubles for 800/900 pm.

MacronvFrugals

PropQueries wrote: »

Breakdown of Soft Costs:

Professional Fees: €5,650
Levies: €13,984
Land and Acquisition Costs: €60,823
Sales, Marketing and Legal Fees: €8,400
Finance Costs: €16,716
Margin: €42,671
VAT: €44,165

Total Soft Costs: €192,409

I would assume most, if not all, of these could be cut for council houses? If the council and government really wanted to of course.

In Portlaoise, private developers are asking €212,000 for 92sq.m. A-rated 3-bed semis. I'm sure the council (if they wanted to) could easily build terraced a-rated council houses on state land in Dublin for half those asking prices.

Link to MyHome here: https://www.myhome.ie/residential/brochure/202-16-clonkeen-view-bellingham-portlaoise-laois/4401935

They're really nice for the money, didnt think it was possible to build that cheap even in portlaoise

Knex*

IK09 wrote: »

Hey guys,

What is the website that Ive seen here before where people can check the purchase price of a property?

https://www.propertypriceregister.ie/website/npsra/pprweb.nsf/PPR?OpenForm

Lolle06

brisan wrote: »

The op said that people on lower incomes don’t buy houses in the 500k range and don’t affect the property market
I proved she was wrong
If you agree with her then you too are wrong.
I know people in hospitality who regularly take home 800 euro plus a week with wages overtime and tips
Do you know the average tip take on Sunday afternoon tea in the shelbourne
I do and I was shocked
Do you know the average tip a wedding planner gets in a top hotel , often doing 2 or 3 a week
I do because I paid two of them
Granted some of those behind the scenes are on poor money but a lot are not
Even those on low money some will rent and if they can’t afford rent , rents will drop as they are at the moment
Lower yields means lower house prices

Of course, you are right and other ppl are wrong - considering your vast knowledge of ppl working in the Shelbourne etc.

I would guess, there are more „behind the scenes“ workers who are on the minimum wage and can’t rely on irregular, completely voluntary „tips“.

I wonder if there are many mortgage lenders who consider the „tip“ as income? You wouldn’t know that too, by any chance?

Anyway, my query was to your reference that a shop worker on a lower income could marry „above their station“.
I simply asked you, what you meant by „above their station“?

Because, believe it or not, that sounds fairly elitist.

Donald Trump

PropQueries wrote: »

Here you go in the SCSI report in July 2020 "The Real Cost of New Housing Delivery" published in July 2020, they put the cost of building a 114 sq.m. home at €371,311, split between €178,902 hard costs and €192,409 soft costs.

Link to SCSI report here: https://www.scsi.ie/documents/get_lob?id=1551&field=file

The above is an average of build costs between small and large developers. My understanding is that Cairn Homes build their A-rated 3-bed semis for under €120k as they have scale. A terraced a-rated home e.g. an A-rated version of an ex-corporation house should probably cost well less than €110k to build.

They print that shite every year

They like to include the >40k "margin" into "costs" despite the fact that they also include paying themselves for all the other inputs first.

Start taxing the developers for hoarding sites and sitting on them

thefridge2006

Property prices down 0.5% in year to July

https://www.irishtimes.com/business/economy/property-prices-down-0-5-in-year-to-july-1.4356260

seems like a drop is happening...... down 1.3% in Dublin. would have been a bigger decrease if it wasn't for the small bit of pent up demand causing mini bidding wars

PropQueries

MacronvFrugals wrote: »

They're really nice for the money, didnt think it was possible to build that cheap even in portlaoise

Even in the boom years, most 3 bed semi-detached homes in Ireland were built for well less than the €100k mark.

My main concern for Dublin house prices is that over the next 30 years, large swathes of the population who currently live in prime locations in Dublin will pass away.

Even if people buy into the nonsense central bank net migration figures continuing at 30,000 a year, every year for the next 30 years, what type of jobs will be available over this period to allow people to buy these homes at current market prices? Is Google going to keep adding 8,000 additional €100k jobs in the Docklands every 5 years indefinitely going forward?

brisan

MacronvFrugals wrote: »

They're really nice for the money, didnt think it was possible to build that cheap even in portlaoise

They are a lovely house but you would not walk into Portlaoise

A fair bit out of town

pearcider

thefridge2006 wrote: »

Property prices down 0.5% in year to July

https://www.irishtimes.com/business/economy/property-prices-down-0-5-in-year-to-july-1.4356260

seems like a drop is happening...... down 1.3% in Dublin. would have been a bigger decrease if it wasn't for the small bit of pent up demand causing mini bidding wars

We’ve seen nothing yet. Wait until the banking crisis starts.

brisan

Lolle06 wrote: »

Of course, you are right and other ppl are wrong - considering your vast knowledge of ppl working in the Shelbourne etc.

I would guess, there are more „behind the scenes“ workers who are on the minimum wage and can’t rely on irregular, completely voluntary „tips“.

I wonder if there are many mortgage lenders who consider the „tip“ as income? You wouldn’t know that too, by any chance?

Anyway, my query was to your reference that a shop worker on a lower income could marry „above their station“.
I simply asked you, what you meant by „above their station“?

Because, believe it or not, that sounds fairly elitist.

You seemed to be under the impression that lower paid workers would not be buying property
I said this was patently not true
If lower paid workers only married other lower paid workers then yes that may be the case
However lower paid workers do marry or buy with higher paid workers hence the marry above their station quip.
Surprisingly I know quite a few Shelbourne workers from the florist to the wedding planner to lounge staff through an acquaintance
And yes you were elitist when you said lower paid workers losing their jobs would not have an impact on the property market
As I pointed out a worker on 30k a year losing their job takes 105k out of a potential mortgage
2 x 30k workers losing their jobs and their is a brand new 3 bed house in Portlaoise that has one less potential buyer

brisan

pearcider wrote: »

We’ve seen nothing yet. Wait until the banking crisis starts.

According to some lads It will be grand

thefridge2006

First fall in property prices since May 2013 as market absorbed impact of the pandemic........ and the snowball starts to roll

https://www.independent.ie/business/personal-finance/first-fall-in-property-prices-since-may-2013-as-market-absorbed-impact-of-the-pandemic-39535762.html

"Experts said the impact of the coronavirus on the market had taken a while to kick in as the price index is based on stamp duty filings, and solicitors can take a while to send them to Revenue."

It could be alot worse in a few months time when the real figures start to roll in

thefridge2006

brisan wrote: »

According to some lads It will be grand

Once the pent up demand is wiped out.....all bets are off. Will fall off a cliff IMO

brisan

thefridge2006 wrote: »

Once the pent up demand is wiped out.....all bets are off. Will fall off a cliff IMO

No way
lads on here saying property prices will stay stable in a major recession with mass unemployment and a lack of credit
I believe them