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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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hometruths

Kasey_Don wrote: »

Can you explain what this is?

You only have to fund 80% (for example, depending on % of govt share) of the purchase. Govt funds the remainder. You buy the government out at some point in the future, or when you sell.

I guess in practice it will be a bit more complicated, but that's it in a nutshell as I understand it.

MacronvFrugals

schmittel wrote: »

You only have to fund 80% (for example, depending on % of govt share) of the purchase. Govt funds the remainder. You buy the government out at some point in the future, or when you sell.

I guess in practice it will be a bit more complicated, but that's it in a nutshell as I understand it.

In other words what desperate things can we come up with to keep property prices inflated.

hometruths

MacronvFrugals wrote: »

In other words what desperate things can we come up with to keep property prices inflated.

Indeed. it sort of seems like once the public gets hooked on high property prices, it is difficult to wean everybody off them. And the longer it goes on the more people don't realise that high prices don't actually make anybody better off.

Except the builders obviously.

PropQueries

Cyrus wrote: »

i was more of a PDs voter personally, im a floating voter now but i wont ever be floating sinn feinns way

Never thought

We actually have something in common.

PropQueries

Cyrus wrote: »

let me guess, is the answer they are all going to become social housing?

You're probably not actually not far off the mark:

"The Department of Justice has announced plans to lease 35 properties in Galway city centre to house asylum seekers. The apartments and town houses are located on Dominick Street and on Munster Avenue. The properties in question have been used for student accommodation and short-term tourist rental purposes in the past."

Link to article on RTE 23/09/2020: https://www.rte.ie/news/connacht/2020/0923/1166889-asylum-seekers-housing-galway/

PropQueries

schmittel wrote: »

Government taking an equity stake in people's houses:

This will not end well.

It never does. Let's hope they don't decide to include second-hand homes in that...

Taylor365

calfmuscle wrote: »

I'm a first time buyer trying to buy solo, the market it flying up around here. Iv rang asking about 3 houses priced 215 to 245 all went by 15k to 40k over the asking price. Its a nightmare and unless there is a crash I'll never get a home.

I would say "Nay worries, renting for life isn't a death sentence", but in this country it really is :pac:

Rent, artificially inflated and regulated into oblivion for the small time LL, will never be at an acceptable level while evictions take so long and big business can keep units sit empty.

Smouse156

PropQueries wrote: »

It never does. Let's hope they don't decide to include second-hand homes in that...

I just don’t understand the heavy social housing spend! They all vote for SF/IRA anyway and will just drive away any potential voters out of the FTB group

PropQueries

MacronvFrugals wrote: »

In other words what desperate things can we come up with to keep property prices inflated.

It could actually benefit first-time buyers who are interested in the second-hand home market by removing people from the demand side for second-hand homes towards new builds. That's assuming they don't include second-hand homes.

hometruths

PropQueries wrote: »

It could actually benefit first-time buyers who are interested in the second-hand home market by removing people from the demand side for second-hand homes towards new builds. That's assuming they don't include second-hand homes.

Surely if you're a first time buyer who can avail of 30k HTB and not have to fund whatever portion of equity the govt are buying on a new build, you'd need your head examined to buy a second hand house?!

L1011

Smouse156 wrote: »

I just don’t understand the heavy social housing spend! They all vote for SF/IRA anyway and will just drive away any potential voters out of the FTB group

Politics to the politics forum - this applies to everyone. Impact of the budget is fine to discuss but specific party politics are a no.

Hubertj

schmittel wrote: »

Surely if you're a first time buyer who can avail of 30k HTB and not have to fund whatever portion of equity the govt are buying on a new build, you'd need your head examined to buy a second hand house?!

Sorry I don’t follow. Why would you always choose new vs 2nd hand?

HotDudeLife

Nice to see the government bailed out landlord<SNIP>. The addition of nearly 10k social housing units is welcome.

More supply is a good thing, even though some insist low supply = high prices, this is not true. We had historical levels of low supply between 2010-2013 and that is around the same time we witnessed the lowest prices.

brisan

schmittel wrote: »

Surely if you're a first time buyer who can avail of 30k HTB and not have to fund whatever portion of equity the govt are buying on a new build, you'd need your head examined to buy a second hand house?!

Why
if the second hand house is in an area you want ?
Buy the worst house on the best road you can afford
You can change everything about a house except its location

HotDudeLife

schmittel wrote: »

Surely if you're a first time buyer who can avail of 30k HTB and not have to fund whatever portion of equity the govt are buying on a new build, you'd need your head examined to buy a second hand house?!

In areas close to me, the new builds were whipped up in ridiculous locations and prices well above what they are worth, plus a good chunk of them are allocated to social housing so chance they may become ghettos.

Also who wants to work hard and pay for a brand new house only to have some leech move in next door for free. If something is for free/highly reduced, they won't value it and these areas will turn into dumps.

Second hand houses in mature areas are the way to go.

TheSheriff

brisan wrote: »

Why
if the second hand house is in an area you want ?
Buy the worst house on the best road you can afford
You can change everything about a house except its location

Have to agree here, we ruled out new builds early on in our search. I'd love one (purely for build quality), but give me an established park rather than the pot luck new build estates any day of the week.

HotDudeLife

calfmuscle wrote: »

I'm a first time buyer trying to buy solo, the market it flying up around here. Iv rang asking about 3 houses priced 215 to 245 all went by 15k to 40k over the asking price. Its a nightmare and unless there is a crash I'll never get a home.

Patience my friend, play the long game. This house of cards won't be standing much longer, huge crash coming in 2021-2022.

awec

HotDudeLife wrote: »

Patience my friend, play the long game. This house of cards won't be standing much longer, huge crash coming in 2021-2022.

Huge crash coming next year*.

* repeat every year.

TheSheriff

HotDudeLife wrote: »

Patience my friend, play the long game. This house of cards won't be standing much longer, huge crash coming in 2021-2022.

Every few months it gets further and further away......

Cyrus

TheSheriff wrote: »

Every few months it gets further and further away......

Yes and some of the more prolific doom merchants have left the thread , they will be back as soon as there is any glimmer that their prophecies of utter economic devastation are coming to pass, I see them thanking the odd post.

hometruths

TheSheriff wrote: »

Have to agree here, we ruled out new builds early on in our search. I'd love one (purely for build quality), but give me an established park rather than the pot luck new build estates any day of the week.

Personally I'd never live in a housing estate of any vintage but it strikes me that the bulk of FTBers are driven to spend the max they can afford based on the amount of deposit saved + lending limits etc.

I could easily envisage a scenario in which most FTBers feel like it is an unwise decision to buy a 250k second hand house when for the same outlay they could buy a 320k new build.

TheSheriff

schmittel wrote: »

Personally I'd never live in a housing estate of any vintage but it strikes me that the bulk of FTBers are driven to spend the max they can afford based on the amount of deposit saved + lending limits etc.

I could easily envisage a scenario in which most FTBers feel like it is an unwise decision to buy a 250k second hand house when for the same outlay they could buy a 320k new build.

New builds come with several disadvantages, and as someone who is actively looking we were as wise as every other FTB. Every new built we went too, first question was "Wheres the social housing going".

awec

schmittel wrote: »

Surely if you're a first time buyer who can avail of 30k HTB and not have to fund whatever portion of equity the govt are buying on a new build, you'd need your head examined to buy a second hand house?!

Most FTBs don't really get to make this decision, at least not if they are shopping for houses that are comparable between new / used.

Imagine they give up the 30k. And let's imagine the 30k inflates the price of the house, so a similar second hand house is 30k cheaper than the new house.

So for example:

new build @ 500k - deposit required = 50k, 30k htb 20k savings
second hand @ 470k - deposit required = 47k, 47k savings

Over twice the savings needed. SO if it took them 2 years to save 20k, it'll take at least that again to save the next bit.

Even if the second hand was say 60k cheaper, you are still looking at needing 44k deposit saved, again still twice the amount.

It's not a decision most can really make. But I would say that finance is only one aspect of this, obviously many FTBs do buy second hand because of the other intangibles (e.g. location preferences or whatever).

Rattlehead_ie

It also depends on whats out there to buy new and mortgage running out.
Im in a situation of where Im looking at both as a FTB, but everything in the areas Im looking at new is gone and waiting for "next phase" with no timeline. At least the HTB was extended.

hometruths

TheSheriff wrote: »

New builds come with several disadvantages, and as someone who is actively looking we were as wise as every other FTB. Every new built we went too, first question was "Wheres the social housing going".

Hadn't really considered that, but fair point, I can see how that would be a factor.

hometruths

awec wrote: »

Most FTBs don't really get to make this decision, at least not if they are shopping for houses that are comparable between new / used.

Imagine they give up the 30k. And let's imagine the 30k inflates the price of the house, so a similar second hand house is 30k cheaper than the new house.

So for example:

new build @ 500k - deposit required = 50k, 30k htb 20k savings
second hand @ 470k - deposit required = 47k, 47k savings

Over twice the savings needed. SO if it took them 2 years to save 20k, it'll take at least that again to save the next bit.

Even if the second hand was say 60k cheaper, you are still looking at needing 44k deposit saved, again still twice the amount.

It's not a decision most can really make. But I would say that finance is only one aspect of this, obviously many FTBs do buy second hand because of the other intangibles (e.g. location preferences or whatever).

Yes, I think we are in agreement - they're being funnelled into new builds whether they like it or not.

The point I made was in reference to the possibility that there might be some shared equity scheme on top of HTB.

Although a new build in a housing estate would be the last thing I would want if I was an FTB being offered HTP and shared equity, even I would buy a new build.

If it is anything like the UK scheme it would be too good to turn down:

With a Help to Buy: Equity Loan the government lends you up to 20% (40% if you’re in London) of the cost of your newly built home.

You pay a deposit of 5% or more and arrange a mortgage of 25% or more to make up the rest.

Particularly, if like me you're cynical enough to believe you'd never actually have to pay it off, and your fellow taxpayers will foot the bill for you!

enricoh

calfmuscle wrote: »

I'm a first time buyer trying to buy solo, the market it flying up around here. Iv rang asking about 3 houses priced 215 to 245 all went by 15k to 40k over the asking price. Its a nightmare and unless there is a crash I'll never get a home.

Chances are you were outbid by taxpayers money for social housing on some of them. If u can't beat them, join them!

KnowingWind

Just remember guys.

Just about when all the sheep are saying property will go up forever and never drop...is when it drops.

The drops are quick, all signs are in.

mousblaster17

HotDudeLife wrote: »

Patience my friend, play the long game. This house of cards won't be standing much longer, huge crash coming in 2021-2022.

lol!

Waiting for house prices to drop be like...

if you believe prices will drop, you'll never buy.

Bubbaclaus

KnowingWind wrote: »

Just remember guys.

Just about when all the sheep are saying property will go up forever and never drop...is when it drops.

The drops are quick, all signs are in.

If all the signs are in, then I'm sure you would like to share them all with the class.