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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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PropQueries

Pelezico wrote: »

We are having QE on steroids. There will be no crash, just inflation. Some will suffer of course but there will be a boom.

QE will end up being meaningless if there’s an oversupply problem In the property market as I believe there is.

It’s why the ECB haven’t hit their inflation targets over the past 5 years. China’s oversupply of cheap goods and technology meant no amount of QE would have got inflation up when measured by the traditional means over the past 5 years.

Timing belt

PropQueries wrote: »

So you believe the below from 2015 is the exception rather than the rule in relation to the €200 billion in property and business loans they purchased between 2012 and 2016?

Yes as I showed you previously a large portion of the 200bn related to the uk market and of the 20bn in property sold by Nama a large portion of this was sold back to original developers

Pelezico

We are having QE on steroids. There will be no crash, just inflation. Some will suffer of course but there will be a boom.

PropQueries

Timing belt wrote: »

As I have shown you time and time again less than 20bn was property that was purchased at discounted prices. Funds hold more property that they purchased at market value than they acquired at discount

So you believe the below from 2015 is the exception rather than the rule in relation to the €200 billion in property and business loans they purchased between 2012 and 2016?

“In Limerick, for example, one probable investor acquired nine apartments at the Broad Leaf development in the city centre for just €65,000, or about €7,200 each. An investor could expect rents of about €400 a month for a two-bed at the development. In nearby Shannon, Co Clare, 23 apartments were acquired for just €14,354 each at the Linden Apartment Blocks.“

Mad_maxx

cnocbui wrote: »

I can't imagine how absolutely awful such a property must have been when €100 K is what my ex paid in 2011 for an old small two bedroom terrace in Limerick, and that was 15% below asking and a bit of a bargain.

Post a pic of one of these Dublin 100K properties, as I am slightly skeptical.

i put a 10500 bid on a really nice ground floor - own door one bed apartment in stoneybatter in august 2012 , the EA never got back to me and i went my own way , it sold a few months later for 108 k

there was tonnes of stuff in good locations for 100k in limerick as recent as 2015 as limerick took an eternity to get off the canvas post crash

Timing belt

antiskeptic wrote: »

It will be a question of whether they want out because the value of their investment at whatever point it is can be better invested somewhere else. If so, then it makes no odds how much its dropped.

If downward pressure and some early adopters exit then that will trigger the next bunch .. and the next. On such sentiment is there boom and bust. Boom and bust being the nature of the world economy.

Name a different investment that you can get a Yield of 5% with limited risk in the global economy at present and ask why would they give that up.

antiskeptic

Claw Hammer wrote: »

So the vultures are going to crash the market and ruin the value of their remaining securities in their move to exit Ireland? Are they really going to piss on their own cornflakes?

It will be a question of whether they want out because the value of their investment at whatever point it is can be better invested somewhere else. If so, then it makes no odds how much its dropped.

If downward pressure and some early adopters exit then that will trigger the next bunch .. and the next. On such sentiment is there boom and bust. Boom and bust being the nature of the world economy.

Timing belt

PropQueries wrote: »

If they bought an apartment in limerick city for €7,000 and sell it for €25,000, they’ve just trebled their money even if the market did fall by 75% from today’s prices.

Such a fall would only impact those who purchased in the past four years, not them.

As I have shown you time and time again less than 20bn was property that was purchased at discounted prices. Funds hold more property that they purchased at market value than they acquired at discount

PropQueries

Claw Hammer wrote: »

How will that work if they crash the market in the process?

If they bought an apartment in limerick city for €7,000 and sell it for €25,000, they’ve just trebled their money even if the market did fall by 75% from today’s prices.

Such a fall would only impact those who purchased in the past four years, not them.

Pelezico

Timing belt wrote: »

Just flick the switch back on and the economy is back to what it was let’s forget about the billions of debt taken on by companies and go party.

I know that without trying , bank balance just keeps getting healthier. There is nothing for me to spend money on.

I want a bit of hedonism, as does my darling wife. I can only talk about my own situation.

Timing belt

PropQueries wrote: »

Not really. As per 2015 in the article I linked above:

“In Limerick, for example, one probable investor acquired nine apartments at the Broad Leaf development in the city centre for just €65,000, or about €7,200 each. An investor could expect rents of about €400 a month for a two-bed at the development. In nearby Shannon, Co Clare, 23 apartments were acquired for just €14,354 each at the Linden Apartment Blocks.“

These investment funds can sell their properties for a quarter of today’s asking prices and still walk away with double their initial investment.

Imagine what they bought properties for in 2012/2013/2014.
A
Not a bad return after 5 or 6 years?

And the 200bn you quote is nama plus the loan books that banks exiting Ireland sold. Where is the property?

[Deleted User]

mcsean2163 wrote: »

Put in an offer for a house in Kildare at the asking price and seller sitting on their hands. Hard to know what to do as huge money and if the economy does go bust....

We're being told lots of people are having second viewings and bringing builders with them etc. What do people think, should we bid against ourselves and raise the offer, sit it out or walk away?

Are houses generally going for above asking in your area. If you go in quick with an increased offer they may wait anyway to see if a higher offer comes in from someone else. I'd let your offer sit for a week or 2.

Hard to know the circumstances in your case though.

Timing belt

Pelezico wrote: »

We are going to have a massive boom after the pandemic. People have saved massive wedges onto eye and that money will be spent.

I cant wait for it. Already planning my dream trip to northern India.

Just flick the switch back on and the economy is back to what it was let’s forget about the billions of debt taken on by companies and go party.

Claw Hammer

PropQueries wrote: »

Not really. As per 2015 in the article I linked above:

“In Limerick, for example, one probable investor acquired nine apartments at the Broad Leaf development in the city centre for just €65,000, or about €7,200 each. An investor could expect rents of about €400 a month for a two-bed at the development. In nearby Shannon, Co Clare, 23 apartments were acquired for just €14,354 each at the Linden Apartment Blocks.“

These investment funds can sell their properties for a quarter of today’s asking prices and still walk away with double their initial investment.

Not a bad return after 5 or 6 years?

How will that work if they crash the market in the process?

PropQueries

Claw Hammer wrote: »

So the vultures are going to crash the market and ruin the value of their remaining securities in their move to exit Ireland? Are they really going to piss on their own cornflakes?

Not really. As per 2015 in the article I linked above:

“In Limerick, for example, one probable investor acquired nine apartments at the Broad Leaf development in the city centre for just €65,000, or about €7,200 each. An investor could expect rents of about €400 a month for a two-bed at the development. In nearby Shannon, Co Clare, 23 apartments were acquired for just €14,354 each at the Linden Apartment Blocks.“

These investment funds can sell their properties for a quarter of today’s asking prices and still walk away with double their initial investment.

Imagine what they bought properties for in 2012/2013/2014.

Not a bad return after 5 or 6 years?

Pelezico

We are going to have a boom after the pandemic. People have saved massive wedges and that money will be spent on property and luxuries.

I cant wait for it. Already planning my dream trip to northern India.

Claw Hammer

PropQueries wrote: »

I’ve also given my opinion that the €200 billion in property and business loans purchased by the investment funds between 2012 and 2016 is the primary reason there’s a supply problem and when they initiate their exit strategy the prices will drop well below 2011 prices on the back of a massive oversupply of homes re-entering the market at that time. Whether that time is next year or in 5 years, they will exit and that excess supply will become very much visible.

.

So the vultures are going to crash the market and ruin the value of their remaining securities in their move to exit Ireland? Are they really going to piss on their own cornflakes?

Marius34

PropQueries wrote: »

I have already worked out why. As I’ve mentioned on many occasions, we had 180k empty houses in 2016 as per the census or 90k empty houses in Q2 2020 as per the geodirectory report.

90k in difference for the same thing? this shows how little you understand about those reports. Totaly different numbers, different meaning, but you use as the same thing.

Given that we’ve built over 100.000 new homes in the past ten years and the population only grew by 173,000 between 2011 and 2016, with over a 100,000 of that increase in the over 65’s, I don’t believe there’s any demand/supply problem.

5 years of population growth vs 10 years of how much we build...

I’ve also given my opinion that the €200 billion in property and business loans purchased by the investment funds between 2012 and 2016 is the primary reason there’s a supply problem and when they initiate their exit strategy the prices will drop well below 2011 prices on the back of a massive oversupply of homes re-entering the market at that time. Whether that time is next year or in 5 years, they will exit and that excess supply will become very much visible.

absolute conspiracy

cnocbui

PropQueries wrote: »

Here’s an article from 2016 regarding properties in Dublin selling for around the €100k mark. I would imagine a lot more and a lot better properties would have been available in 2011 for around the same price.

“Latest analysis of the property price register (PPR ) shows that some 25 per cent of properties sold in Ireland in the first eight months of the year went for €100,000 or less, while more than 400 properties sold for €20,000 or less.

Even Dublin, with its elevated property market, also makes the top 10, accounting for 3.5 per cent of properties sold under €100,000.“

Link to Irish times article here: https://www.irishtimes.com/life-and-style/homes-and-property/ireland-s-bargain-properties-one-in-four-sell-for-under-100-000-1.2816064

Which of those pics is of a property in Dublin?

PropQueries

Hubertj wrote: »

Oh it is stupid. Apart from predicting 75% decrease the fact you can’t work out why prices won’t fall by that much reinforces the stupidity. Therefore you’re trying to wind people up. Or it could be that you are really not very intelligent.

I have already worked out why. As I’ve mentioned on many occasions, we had 180k empty houses in 2016 as per the census or 90k empty houses in Q2 2020 as per the geodirectory report.

Given that we’ve built over 100.000 new homes in the past ten years and the population only grew by 173,000 between 2011 and 2016, with over a 100,000 of that increase in the over 65’s, I don’t believe there’s any demand/supply problem.

I’ve also given my opinion that the €200 billion in property and business loans purchased by the investment funds between 2012 and 2016 is the primary reason there’s a supply problem and when they initiate their exit strategy the prices will drop well below 2011 prices on the back of a massive oversupply of homes re-entering the market at that time. Whether that time is next year or in 5 years, they will exit and that excess supply will become very much visible.

Remember, the experts quite literally laughed in Morgan’s face on prime time in 2007/8 when he said prices will drop by 50%.

Browney7

mcsean2163 wrote: »

Put in an offer for a house in Kildare at the asking price and seller sitting on their hands. Hard to know what to do as huge money and if the economy does go bust....

We're being told lots of people are having second viewings and bringing builders with them etc. What do people think, should we bid against ourselves and raise the offer, sit it out or walk away?

Too many variables to advise. Some questions to ask yourself:

How long is it on the market? How does the price compare to others in the area that you've been monitoring? Does it have room to expand? How much work is needed? Is it aimed at FTB's or trade up? I'd take the EA's musings with several grains of salt and I'd personally have an attitude of "so what" to the "several second viewings with builders" information...where is the resultant offer from these viewings?

Keep an eye on the market and don't get too emotionally involved.

Cyrus

PropQueries wrote: »

Here’s an article from 2016 regarding properties in Dublin selling for around the €100k mark. I would imagine a lot more and a lot better properties would have been available in 2011 for around the same price.

“Latest analysis of the property price register (PPR ) shows that some 25 per cent of properties sold in Ireland in the first eight months of the year went for €100,000 or less, while more than 400 properties sold for €20,000 or less.

Even Dublin, with its elevated property market, also makes the top 10, accounting for 3.5 per cent of properties sold under €100,000.“

Link to Irish times article here: https://www.irishtimes.com/life-and-style/homes-and-property/ireland-s-bargain-properties-one-in-four-sell-for-under-100-000-1.2816064

Did you read what you linked ?

A sizeable number of properties selling for less than €100,000 are selling for not “full market value”. According to the Revenue Commissioners, reasons vary; a 50 per cent share of a property may be transferred from someone to their spouse for example, with the PPR only recording the value of the 50 per cent share transferred. Similarly, if properties have non-residential elements, the price register only shows the residential value.

PropQueries

cnocbui wrote: »

I can't imagine how absolutely awful such a property must have been when €100 K is what my ex paid in 2011 for an old small two bedroom terrace in Limerick, and that was 15% below asking and a bit of a bargain.

Post a pic of one of these Dublin 100K properties, as I am slightly skeptical.

Here’s an article from 2016 regarding properties in Dublin selling for around the €100k mark. I would imagine a lot more and a lot better properties would have been available in 2011 for around the same price.

“Latest analysis of the property price register (PPR ) shows that some 25 per cent of properties sold in Ireland in the first eight months of the year went for €100,000 or less, while more than 400 properties sold for €20,000 or less.

Even Dublin, with its elevated property market, also makes the top 10, accounting for 3.5 per cent of properties sold under €100,000.“

Link to Irish times article here: https://www.irishtimes.com/life-and-style/homes-and-property/ireland-s-bargain-properties-one-in-four-sell-for-under-100-000-1.2816064

mcsean2163

Put in an offer for a house in Kildare at the asking price and seller sitting on their hands. Hard to know what to do as huge money and if the economy does go bust....

We're being told lots of people are having second viewings and bringing builders with them etc. What do people think, should we bid against ourselves and raise the offer, sit it out or walk away?

Cyrus

PropQueries wrote: »

Not really. Many properties in Dublin City that could have been bought for around the €100k mark in 2011 would be asking €300k to €400k today.

Any example of one that wasn’t extensively upgraded

Hubertj

PropQueries wrote: »

Not really. Many properties in Dublin City that could have been bought for around the €100k mark in 2011 would be asking €300k to €400k today.

Oh it is stupid. Apart from predicting 75% decrease the fact you can’t work out why prices won’t fall by that much reinforces the stupidity. Therefore you’re trying to wind people up. Or it could be that you are really not very intelligent.

cnocbui

PropQueries wrote: »

Not really. Many properties in Dublin City that could have been bought for around the €100k mark in 2011 would be asking €300k to €400k today.

I can't imagine how absolutely awful such a property must have been when €100 K is what my ex paid in 2011 for an old small two bedroom terrace in Limerick, and that was 15% below asking and a bit of a bargain.

Post a pic of one of these Dublin 100K properties, as I am slightly skeptical.

PropQueries

Hubertj wrote: »

That’s a really stupid statement to make. Up there with the rest of them. I know you’re just trying to wing people up but it’s tiring after a few months. Sad sad life.

Not really. Many properties in Dublin City that could have been bought for around the €100k mark in 2011 would be asking €300k to €400k today.

Timing belt

PommieBast wrote: »

A major issue is who will end up picking up the tab for what looks like is going to be at least a year of unpaid rents. Institutional landlords going bust is not something that can happen in isolation and everyone else in the economy ending up fine. As for small-fry landlords who their property is their pension...

The landlords will need to pick up the tab as it is the cost of doing business.

If there was no risk then there should be no reward.

You could argue who is going to pick up the tab for all the business that were forced to close. Yes there will be help in the form of loans or grants but the costs still sit with them so why should landlords be any different.

Timing belt

PropQueries wrote: »

But on a brighter note, a house valued today at c. €400k will most likely have a value of c. €100k in 5 years so a 2% property tax would only amount to c. €2k per year instead of c. €8k per year.

So you have moved from a 50% drop in house prices in 5 years to a 75% drop....you will need a new conspiracy theory to justify the extra decrease :-)