2021 Irish Property Market chat - mod warnings post 1

John Hutton wrote: »

2021 is the year for me (hopefully) Hope to buy (FTB) in late summer/autumn in a town where I can commute to Dublin. Have a budget of around 200k, have my deposit saved already. Looking to buy a 2/3 bedroom house or Duplex if can't get a house. No apartments.

Currently, I'm thinking it will probably be Drogheda, does anyone have any recommendation for any other towns within an hours (public transport) commute of Dublin in my budget? (I've already ruled out Balbriggan).

https://dundoogan.ie/ " A-rated 2 beds are 214.950k a little outside your commuting parameters but if you had any work from home days it would be grand. I don't know the area well but it's by the sea and the M1 is brilliant. I have driven to Warrenpoint in NI from north county Dublin in 1.20, Warrenpoint is about 25kilmoters further on.

mariaalice wrote: »

Why cant you buy a new build?

New builds tend to be massive estates in the outskirts of the city or town.
Or miles away from anywhere.
Big money too.

brisan

Shelga wrote: »

I don't think there are any new builds under €300k in Dublin.

Are you looking for a house or an apartment ?
3 bed new build apartments available for 300k ,2 bed 250k

Shelga wrote: »

I don't think there are any new builds under €300k in Dublin.

Do you have to stay in Dublin?

brisan wrote: »

Are you looking for a house or an apartment ?
3 bed new build apartments available for 300k ,2 bed 250k

Either. I just looked on Daft and the only new builds under €300k are in Balbriggan and Skerries, and only 1 development in each, unless I'm missing something?

mariaalice wrote: »

Do you have to stay in Dublin?

Yes. My job, family and friends are all here.

John Hutton

mariaalice wrote: »

https://dundoogan.ie/ " A-rated 2 beds are 214.950k a little outside your commuting parameters but if you had any work from home days it would be grand. I don't know the area well but it's by the sea and the M1 is brilliant. I have driven to Warrenpoint in NI from north county Dublin in 1.20, Warrenpoint is about 25kilmoters further on.

Public transport commute from there is at least 90 mins pushing 2 hours. Would be quicker living in Dundalk town getting the train, but I've decided Dundalk is a little too far.

Thank you though, a good shout.

€255,000 - €365,000
Barnageeragh Cove - Barnageeragh Cove, Skerries, Dublin

Taylor Hill - Balbriggan, County Dublin€270,000 - €320,000.

I know it's hard on people but there are choices.

Skerries is gorgeous the beach is fabulous, living by the sea is a great lifestyle for anyone.

brisan wrote: »

They would still qualify as a FTB provided they left the home and no longer had a financial interest in it.

https://www.lawsociety.ie/globalasse...-notes/ftb.pdf

I checked that link and it seems to be out of date as its from 2005
From the gov.ie website

If you are buying or self-building the property with someone else, they must also be a first-time buyer. You will not qualify if you have previously bought or built a property, either individually or jointly with anyone else, even if you are now separated or divorced from that person.

https://www.gov.ie/en/service/bc9df-help-to-buy-htb-scheme/#:~:text=The%20Help%20to%20Buy%20(HTB)%20scheme%20helps%20first%2Dtime,%2Doff%20self%2Dbuild%20homes.&text=The%20Help%20to%20Buy%20scheme,the%20previous%204%20tax%20years.

So people who are divorced or separated are not eligible for HTB

Interesting I just had a look and yes you are correct for HTB but you may be considered a FTB for stamp duty etc

If you separated or divorced after 15 June 2000 and buy another house, you may qualify for first time buyers' relief. To qualify you must meet the following conditions:

you have left the shared home
you have not retained an interest in the shared home
your former partner continues to live in the house, which you shared before the separation or dissolution of your marriage.

Source : https://www.revenue.ie/en/life-events-and-personal-circumstances/marital-status/separation-divorce-and-civil-annulment/transfer-of-assets-and-property-between-former-partners.aspx

If someone is single anywhere with a seaside location is a great asset you will have daily swimmers, dawn swimmers groups the sea/beach provides a focus around which activities happen so it's a great way of meeting people.

brisan

Shelga wrote: »

Either. I just looked on Daft and the only new builds under €300k are in Balbriggan and Skerries, and only 1 development in each, unless I'm missing something?

New priory hall in Donaghmede /clongriffin

mariaalice wrote: »

€255,000 - €365,000
Barnageeragh Cove - Barnageeragh Cove, Skerries, Dublin

Taylor Hill - Balbriggan, County Dublin€270,000 - €320,000.

I know it's hard on people but there are choices.

Skerries is gorgeous the beach is fabulous, living by the sea is a great lifestyle for anyone.

There are 8 units in that development. I'm not sure how many are in the Balbriggan one, but a 2/3/4 bedroom house, 37km from Dublin city centre, is not ideally suited for a single person in their 20s or 30s.

So, that's 2 new build developments in all of County Dublin, with properties under €300k.

Housing policy is predicated only on couples who are happy to live miles from anywhere.

I've already accepted I'll end up in an apartment in an area I don't love, in order to be closer to family and the city. But it's wildly misleading to pretend that buying a new build in Dublin is feasible, for the vast majority of single people.

brisan wrote: »

New priory hall in Donaghmede /clongriffin

Not technically a new build, so doesn't qualify for any government scheme.

Timing belt wrote: »

Yes their is evidence business and high net worth have been charged negative rates for years and have tried to shift money around but in the end paid the negative rates as the money had to be parked somewhere.

Retail depositors would react different if it was applied to all deposits as you find people keeping it under their mattress. But if it is introduced on a tiered basis it is deposits that attract the negative rate that get the focus.

again, i think negative rates on average mary and joes account could be suicide for the banks, i really cant see them going down that road, but i could be wrong

Shelga wrote: »

There are 8 units in that development. I'm not sure how many are in the Balbriggan one, but a 2/3/4 bedroom house, 37km from Dublin city centre, is not ideally suited for a single person in their 20s or 30s.

So, that's 2 new build developments in all of County Dublin, with properties under €300k.

Housing policy is predicated only on couples who are happy to live miles from anywhere.

I've already accepted I'll end up in an apartment in an area I don't love, in order to be closer to family and the city. But it's wildly misleading to pretend that buying a new build in Dublin is feasible, for the vast majority of single people.

You are correct, but its a compromise one of mine would love to buy where she grew up but it is not possible luckily she is in a position to live somewhere else where the property is affordable very similar to where she grew up sea on one side and mountains on the other so very happy with the area.

Wanderer78 wrote: »

again, i think negative rates on average mary and joes account could be suicide for the banks, i really cant see them going down that road, but i could be wrong

They won’t apply to all retail deposits as 70-80% of loans are funded by customer deposits so they will not want to impact these deposits. It is just the higher level of deposits that they will want to target. The options the banks have are:
-negative rates over x
- put a cap on deposits only allowing a customer deposit up to x.
- increase the margin on lending to compensate
- increase bank charges
- accept the loss

The longer we are in a low interest rate environment the less likely that the bank will just accept the loss as bonds with a higher yield roll off the banking book and are replaced with bonds with a negative yield.

A negative rate, cap or a increase in margin on lending all have the ability to influence the property market.

Timing belt wrote: »

They won’t apply to all retail deposits as 70-80% of loans are funded by customer deposits so they will not want to impact these deposits. It is just the higher level of deposits that they will want to target. The options the banks have are:
-negative rates over x
- put a cap on deposits only allowing a customer deposit up to x.
- increase the margin on lending to compensate
- increase bank charges
- accept the loss

The longer we are in a low interest rate environment the less likely that the bank will just accept the loss as bonds with a higher yield roll off the banking book and are replaced with bonds with a negative yield.

A negative rate, cap or a increase in margin on lending all have the ability to influence the property market.

deposits are not used directly in the process of credit creation, they are simply held in reserves

Villa05

mariaalice wrote:

So are you give up working or are you going to default on your mortgage?

The conditions I described are unfortunately fact for the majority of people with a housing need.
This has been, for the most part the result of successive government policy.
This is unsustainable and will lead to another crash, to avoid this we need a change of policy or government

Wanderer78 wrote: »

deposits are not used directly in the process of credit creation, they are simply held in reserves

Customer deposits & Capital are the main source of funds for Irish banks (accounting for 90%) as they have little appetite (internally or from a regulatory perspective) to source funding from the wholesale markets.

Timing belt wrote: »

Customer deposits & Capital are the main source of funds for Irish banks (accounting for 90%) as they have little appetite (internally or from a regulatory perspective) to source funding from the wholesale markets.

what do you mean by this, and does it differ from current central bank research on credit creation, primarily from the bank of england, Bundesbank and the Norwegian central banks?

Wanderer78 wrote: »

what do you mean by this, and does it differ from current central bank research on credit creation, primarily from the bank of england, Bundesbank and the Norwegian central banks?

It's not the forum to discuss but the following link explains the regulatory landscape around liquidity as introduced under CRD IV which European banks need to comply with following the 2008 crash

https://www.ecb.europa.eu/pub/financial-stability/macroprudential-bulletin/html/ecb.mpbu201910_2~3237802727.en.html#toc9

Timing belt wrote: »

It's not the forum to discuss but the following link explains the regulatory landscape around liquidity as introduced under CRD IV which European banks need to comply with following the 2008 crash

https://www.ecb.europa.eu/pub/financial-stability/macroprudential-bulletin/html/ecb.mpbu201910_2~3237802727.en.html#toc9

does this contradict the papers released by the central banks mentioned, or also confirm their findings?

amacca

Timing belt wrote: »

They won’t apply to all retail deposits as 70-80% of loans are funded by customer deposits so they will not want to impact these deposits. It is just the higher level of deposits that they will want to target. The options the banks have are:
-negative rates over x
- put a cap on deposits only allowing a customer deposit up to x.
- increase the margin on lending to compensate
- increase bank charges
- accept the loss

The longer we are in a low interest rate environment the less likely that the bank will just accept the loss as bonds with a higher yield roll off the banking book and are replaced with bonds with a negative yield.

A negative rate, cap or a increase in margin on lending all have the ability to influence the property market.

only a fairly uninformed guess but

I think they might go with a cap first assuming they have enough on deposit to satisfy capital ratios....it would be less likely to cause the kind of headlines charging negative rates might.....then/or negative rates over a fairly hefty deposit amount (depending on the banks situation)

could be a different scenario but some CUs have gone with a cap as they are losing money on the deposits and cant get enough money lent out so people are already aware of that and it doesn't seem to have cause a stink

the difference between what the banks were at early to mid 2000s and now regarding deposit accounts is unreal - I remember regular savers with up to 8% interest

of course that situation and whats happening now were both worrying, both scenarios really make me question the value/stability of money.

Id be a fan of slow steady safe predictable type environments........money losing its value on deposit (and not just due to inflation) isnt good at all.

amacca wrote: »

only a fairly uninformed guess but

I think they might go with a cap first assuming they have enough on deposit to satisfy capital ratios....it would be less likely to cause the kind of headlines charging negative rates might.....then/or negative rates over a fairly hefty deposit amount (depending on the banks situation)

could be a different scenario but some CUs have gone with a cap as they are losing money on the deposits and cant get enough money lent out so people are already aware of that and it doesn't seem to have cause a stink

the difference between what the banks were at early to mid 2000s and now regarding deposit accounts is unreal - I remember regular savers with up to 8% interest
of course that situation and whats happening now were both worrying, both scenarios really make me question the value/stability of money.

you may be correct that the banks go with a CAP but if all banks implement this then you will have some depositors looking for a home for there excess deposits that they will need to invest elsewhere.

Back in the early to mid 2000s ECB rates were 2-3% but banks relied heavily on the the wholesale markets for funding so were willing to pay for deposits as it was a cheaper source of funds.

Idbatterim

https://www.irishtimes.com/business/economy/economists-predicted-a-covid-property-collapse-it-hasn-t-happened-1.4449261?mode=amp

Very interesting, one thing is for sure, the time lines involved for crash to build or recovery to come about are way longer than people expect. Also everything seems fine until like a tree in a storm, what looked strong, just collapses. There is so little supply, even with another economic shock would prices drop, so many high paying and secure jobs, in government and private sector, so little supply...

Short of potentially another bailout situation or worse...

Idbatterim wrote: »

https://www.irishtimes.com/business/economy/economists-predicted-a-covid-property-collapse-it-hasn-t-happened-1.4449261?mode=amp

Bery interesting, ome thing is for sure, the time lines involved for crash to build or recivery to cone about are way longer than people expect. Also everything seems fine until like a tree on a storm, what looked strong, just collapses. There is so little supply, even with another economic shock would prices drop, so many high paying and secure jobs, in government and private sector, so little supply...

Short of potentially another bailout situation or worse...

or bail in!

yagan

Idbatterim wrote: »

https://www.irishtimes.com/business/economy/economists-predicted-a-covid-property-collapse-it-hasn-t-happened-1.4449261?mode=amp

Bery interesting, ome thing is for sure, the time lines involved for crash to build or recivery to cone about are way longer than people expect. Also everything seems fine until like a tree on a storm, what looked strong, just collapses. There is so little supply, even with another economic shock would prices drop, so many high paying and secure jobs, in government and private sector, so little supply...

Short of potentially another bailout situation or worse...

It's still very early to tell.

Prices can still climb even as sales decrease, which looking at the PPR for the last year seems to be what's happening.

National prices still rose for two years after volume peaked in 06.

Villa05

Bubbaclaus wrote:

"Those who bore the brunt of the Covid hit, those who lost their jobs and livelihoods in such large numbers, were in relatively low-paying service jobs and were not part of the home-buying market in the first place."

Idbatterim wrote:

Very interesting, one thing is for sure, the time lines involved for crash to build or recovery to come about are way longer than people expect. Also everything seems fine until like a tree in a storm, what looked strong, just collapses. There is so little supply, even with another economic shock would prices drop, so many high paying and secure jobs, in government and private sector, so little supply...

It's an interesting article, lots of danger signals in there dressed up as positives
People lost jobs not income, This income was replaced by state subsidies which need to be paid back. Is spending 15 billion + value for money with the result being maintaining unaffordability in the housing market.