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2021 Irish Property Market chat - mod warnings post 1

hometruths

Happy new year to all.

2020 was the year of pent up demand. I think 2021 will be the year the pent up supply comes to market.

I think the pent up supply will exceed the pent up demand and prices will fall. By how much I have no idea!

edit: Mod Warnings

This thread is about the Irish Property Market, it is not about:
* Immigration
* Refugees
* Welfare recipients
* Welfare rates
* General Irish politics beyond its impact on property
* General Irish economy beyond its impact on property
* How wonderful Country X is to buy in

Additionally, the specific issue of Geodirectory vacancy figures has been done to death and is not to be discussed again.

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Hubertj

Villa05 wrote: »

Billy the programmer will be alright, he most likely will have a place in Dublin
It's Nuala nurse or Mike mechanic or Sammy shopkeeper. If they have to commute 4 hours a day to complete their work. There work suffers, the people of the city suffer , their children suffer, the environment suffers, business suffer. The country suffers

All needless and avoidable

Any comment on the article I linked?

https://www.irishtimes.com/news/social-affairs/council-construction-considerably-more-expensive-than-private-development-report-1.4451602

You seem to think there is a simple solution. Looks far from it based on comments from people who know a lot more about it than you or I.

Affordability and availability are an issue but there is no simple or quick fix.

fliball123

6541 wrote: »

Following thread a long time now. It is clear to everyone that the property is overpriced, scarce as hen's teeth and shocking quality.
It's so bad now that something is going to have to give.

bleedin hell how is it overpriced?

fliball123

Villa05 wrote: »

Billy the programmer will be alright, he most likely will have a place in Dublin
It's Nuala nurse or Mike mechanic or Sammy shopkeeper. If they have to commute 4 hours a day to complete their work. There work suffers, the people of the city suffer , their children suffer, the environment suffers, business suffer. The country suffers

All needless and avoidable

As has been the case for a couple of generations. It still does not mean that Nuala, Mike or Sammy cannot afford a house in Ireland.

Its up to each individual to make their own choices in life and if these people choose those professions they should have looked at the salary and at the locations where the work would be as well as what strain it will put on their lifestyle. I don't see why anyone should feel entitled to live where they want. If you dont like where you live but cannot afford something in a more suitable area for yourself then retrain or upskill and get a job that puts more money in your pocket and gives you more options socially.

6541

Following thread a long time now. It is clear to everyone that the property is overpriced, scarce as hen's teeth and shocking quality.
It's so bad now that something is going to have to give.

Villa05

AdamD wrote:

Except most Billy the programmers have zero interest in living in Cavan

Billy the programmer will be alright, he most likely will have a place in Dublin
It's Nuala nurse or Mike mechanic or Sammy shopkeeper. If they have to commute 4 hours a day to complete their work. There work suffers, the people of the city suffer , their children suffer, the environment suffers, business suffer. The country suffers

All needless and avoidable

fliball123

PommieBast wrote: »

My biggest complaint about the Dublin property market is not so much the prices but the shockingly poor quality of the stock you get for it.

Its not just Dublin there is a drought of available properties all over the country. Myhome as of today now has less than 13k Properties available for sale and to put that in perspective this time last year we had over 23k Properties available for sale on myhome and people wonder why property prices are not falling?

PommieBast

Knex* wrote: »

Anything that looks remotely decent is gonna snap up more attention than it would in normal times. It'll be a while before that can change and people feel comfortable putting their homes online again.

My biggest complaint about the Dublin property market is not so much the prices but the shockingly poor quality of the stock you get for it.

fliball123

Mic 1972 wrote: »

maybe not Cavan, but i'm now renting rooms in D15 to people who work from home for Amazon and Google. It's a lot more convenient for them to rent in D15 than D2

Probably a bit more expensive than Cavan do

Mic 1972

AdamD wrote: »

Except most Billy the programmers have zero interest in living in Cavan

maybe not Cavan, but i'm now renting rooms in D15 to people who work from home for Amazon and Google. It's a lot more convenient for them to rent in D15 than D2

fliball123

AdamD wrote: »

Except most Billy the programmers have zero interest in living in Cavan

Possibly but then Billy like every other Tom, Dick and Harry has to pay a premium if they want to live in an area that is desirable. That unfortunately is the way the property market works all over the globe. Ireland is not an exception. Would I love to have a gaff over looking the sea in Howth. Hell yeah can I afford it: NO. Does that mean I cant afford property in Ireland: NO

[Deleted User]

fliball123 wrote: »

I have also told you that WFH is changing that dynamic ..Billy the computer programmer no longer has to live in D4 or D2 to work in Grand Canal Dock. Billy can now buy somewhere in Cavan or Monaghan or up in a mountain somewhere in Donegal as he is working from home and quite possible will never have to go back into an office. So the country average price is an apt value to use. The average house price is 270k and currently over half of the available stock for sale on myhome is coming in under or on the 275k that.

OK so lets switch away form the AIW and change it to the median wage if you dont like average. So basically the middle point when you take all employees in. The median wage is currently about 31k a year. So lets to the maths again based on a couple on the median wage. This means a couple would be able to buy a house at about 240k. Currently about half the properties available on my home are coming at 250k and under bracket. So the data actually proves the point that there are properties out there that people can afford but you still dont get the idea that you have to pay a premium to live in certain areas.

https://extra.ie/2019/11/21/news/irish-news/cso-average-weekly-wage

Except most Billy the programmers have zero interest in living in Cavan

fliball123

Hubertj wrote: »

https://www.irishtimes.com/news/social-affairs/council-construction-considerably-more-expensive-than-private-development-report-1.4451602

Interesting insights from the council and the difficulties and challenges of building public housing. I thought some claimed it could be built much easier and cheaper by the council.

How could it once the public sector are involved it means an extra layer of bureaucracy and expense.

Hubertj

https://www.irishtimes.com/news/social-affairs/council-construction-considerably-more-expensive-than-private-development-report-1.4451602

Interesting insights from the council and the difficulties and challenges of building public housing. I thought some claimed it could be built much easier and cheaper by the council.

Smouse156

CorkRed93 wrote: »

https://www.irishtimes.com/news/politics/government-ignored-repeated-warnings-that-75m-housing-scheme-would-increase-prices-1.4451837?mode=amp
A surprise to nobody

Scumbags!

fliball123

Villa05 wrote: »

You gave me the figures for a couple on average salary. However household income statistics would suggest that only the top 30% of households earn that income or greater. Basic statistics tell us this in that the average is skewed by high earners who may wish to live in leafy suburbs near the coast and good luck to them

You then gave the average price for a house in the whole country while admitting that affordability issues are confined to cities and surronds

A cities wealth is derived from the people who work there. It is not unreasonable for people who create the wealth in a city to be able to live in that city at an affordable rate. If they can't it can be deemed unaffordable.

With regard to other cities much bigger than Dublin being unaffordable, that would give credence to the concerns that we are in a significant asset price bubble and if people on high salaries are paying greater amounts on accomodation the scope for inflation to take hold is much reduced and this appears to be the basis for for the high valuations of assets be it stocks or property

I have also told you that WFH is changing that dynamic ..Billy the computer programmer no longer has to live in D4 or D2 to work in Grand Canal Dock. Billy can now buy somewhere in Cavan or Monaghan or up in a mountain somewhere in Donegal as he is working from home and quite possible will never have to go back into an office. So the country average price is an apt value to use. The average house price is 270k and currently over half of the available stock for sale on myhome is coming in under or on the 275k that.

OK so lets switch away form the AIW and change it to the median wage if you dont like average. So basically the middle point when you take all employees in. The median wage is currently about 31k a year. So lets to the maths again based on a couple on the median wage. This means a couple would be able to buy a house at about 240k. Currently about half the properties available on my home are coming at 250k and under bracket. So the data actually proves the point that there are properties out there that people can afford but you still dont get the idea that you have to pay a premium to live in certain areas.

https://extra.ie/2019/11/21/news/irish-news/cso-average-weekly-wage

Villa05

fliball123 wrote:

I have given you the average on both AIW and Property price and as I said most expert groups with regard to property agree that property is not overpriced here. Unfortunately the idea that if you want to live in an area that a lot of other people want to live in as in Dublin along the coast or leafy Foxrock.

You gave me the figures for a couple on average salary. However household income statistics would suggest that only the top 30% of households earn that income or greater. Basic statistics tell us this in that the average is skewed by high earners who may wish to live in leafy suburbs near the coast and good luck to them

You then gave the average price for a house in the whole country while admitting that affordability issues are confined to cities and surronds

A cities wealth is derived from the people who work there. It is not unreasonable for people who create the wealth in a city to be able to live in that city at an affordable rate. If they can't it can be deemed unaffordable.

With regard to other cities much bigger than Dublin being unaffordable, that would give credence to the concerns that we are in a significant asset price bubble and if people on high salaries are paying greater amounts on accomodation the scope for inflation to take hold is much reduced and this appears to be the basis for for the high valuations of assets be it stocks or property

Knex*

Mic 1972 wrote: »

All properties i have viewed and bid so far went for significantly higher than asking price, the last one i viewed had an asking price of 230K, it went for 272K.
none of them were under priced for the area, they were priced at the current sale price for similar properties.
I think we are witnessing the start of another leg up in price increases

Put a bid in for a turn key house in Dublin with an asking price of 485 before Christmas. Judging by similar properties over the past two years, I would have had a value of about 480 on it.

3 other bidders in the process and it was up over 510 before I dropped out.

Supply is drastically down though. 3033 houses in all of Dublin up on My Home. Back on the 7th of October this was 4457, which was already lower than you'd expect in a normal year.

Anything that looks remotely decent is gonna snap up more attention than it would in normal times. It'll be a while before that can change and people feel comfortable putting their homes online again.

Mic 1972

All properties i have viewed and bid so far went for significantly higher than asking price, the last one i viewed had an asking price of 230K, it went for 272K.
none of them were under priced for the area, they were priced at the current sale price for similar properties.
I think we are witnessing the start of another leg up in price increases

fliball123

Villa05 wrote: »

I don't hear concerns of multinationals making masses redundant. I do hear valid concerns to the valuations of those companies and the risk that might pose for the future
Also with regard to your claim that there is no affordability issue, why does Google (a company that pays the highest average salary in the country) feel the need to buy residential property for its staff

Well if you looked through some of the commentary on here before xmas people were arguing that MNC where letting people go by the truck load...

As for google a few reasons
One they can afford it.
Two they still own the property and if property can withstand corona for a year it must be fairly solid investment. Where else do they put their money
Three its a way to incentive people to come here from other countries we have not got enough tech experts to fill the jobs available in some of these companies

Google buying property is not really an argument for property being affordable. I have given you the average on both AIW and Property price and as I said most expert groups with regard to property agree that property is not overpriced here. Unfortunately the idea that if you want to live in an area that a lot of other people want to live in as in Dublin along the coast or leafy Foxrock. You have to pay a premium to do so. I also told you this is not unique to Ireland Look at America, Australia, England, France and look at places in here like Sydney, Manhattan, London and Paris..There is a premium needed to be paid to live in a desirable area. Your not making any headway with your argument with google bought some property

Villa05

fliball123 wrote:

Then on the same program a very sad discussion and interviews with 100s living on the street in inner city Dublin in around the gaiety theater who wont go into hostels as its full of drugs and prefer to stay on the street in this horrible freezing weather. So should the government stop snapping up property and just let these people die ?? 2 died over xmas in the cold in Dublin. This is where the government are in a catch 22 situation

I'm glad that this forum has brought out your caring side and the socialist within you.
I'm sure you will admit that the first warnings of a housing crisis were nearly a decade ago. Would it be difficult in that time to have a dedicated shelter for people who do not consume drugs in our capital city

Villa05

fliball123 wrote:

Also heard a few stats on Newstalk there we had an extra 10k people nett hired by multinationals last year so all the talk of them making masses redundant are unfounded and our saving rates up to November or last year ballooned up to 124k Billion in personal savings account and 72 billion in business savings accounts. Thats a lot of savings.

I don't hear concerns of multinationals making masses redundant. I do hear valid concerns to the valuations of those companies and the risk that might pose for the future
Also with regard to your claim that there is no affordability issue, why does Google (a company that pays the highest average salary in the country) feel the need to buy residential property for its staff

Timing belt

Marius34 wrote: »

If Couple cancelling their 30K weddings and 10K honeymoon, they might be now in position to buy.
If single/couple on 100K were not able to save 10% deposit, now they might have.
If single/couple was increasing saving very slowly, they might do it much faster now.

There are so many different scenarios, that additional savings can make them from non-potential buyer to potential buyer, in a year, without change in their job/wage.

yes but you need to remember that according to HDL only couples on a combined income over 200k would benefit and be able to buy which would imply that we are looking at top end properties with a value 800k (200k x3.5 +100k deposit) and not the FTB's market where the majority of people would be looking after saving money from not going to gigs, holidays and all the other items that HDL thinks people will waste their savings on.

Villa05

fliball123 wrote:

I dont think increasing the supply is as easy as you think and who are you to tell a person who owns a property what to do with it? if people want to live, rent or airBnb the hell out of their property that is their business.

I'm not telling them, as far as I am aware sole airbnb of a residential property is illegal

Marius34

HotDudeLife wrote: »

Very marginal, like i said if a person were nowhere near in a position to buy 9 months ago and even if they saved every penny since, they would still not be in a position to make an impact on the market. Not everyone has the discipline to save like that and many are shortsighted and will just waste savings on clothes, gigs, travel etc when restrictions are lifted.

If Couple cancelling their 30K weddings and 10K honeymoon, they might be now in position to buy.
If single/couple on 100K were not able to save 10% deposit, now they might have.
If single/couple was increasing saving very slowly, they might do it much faster now.

There are so many different scenarios, that additional savings can make them from non-potential buyer to potential buyer, in a year, without change in their job/wage.

HotDudeLife

Timing belt wrote: »

How can 10bn be called marginal if the government borrowed 10bn for social housing the country people will be on about the unsustainable debt. It’s not a marginal figure as you put it!!!

If they choose to spend savings on a big party good for them but then can they stop complaining how hard it is to get on the property ladder when as you put they will just waste savings.

It will be marginal when you break it down across the working population and what's left of it is actually used to get on the property ladder. It may help with deposit for a house sure, but only for those already in a position to buy already. Very little of it will transfer into huge cohorts of the population being nowhere near in a position to buy and then suddenly 9 months ready to make it rain on the property market.

Timing belt

HotDudeLife wrote: »

Very marginal, like i said if a person were nowhere near in a position to buy 9 months ago and even if they saved every penny since, they would still not be in a position to make an impact on the market. Not everyone has the discipline to save like that and many are shortsighted and will just waste savings on clothes, gigs, travel etc when restrictions are lifted.

How can 10bn be called marginal if the government borrowed 10bn for social housing the country people will be on about the unsustainable debt. It’s not a marginal figure as you put it!!!

If they choose to spend savings on a big party good for them but then can they stop complaining how hard it is to get on the property ladder when as you put they will just waste savings.

HotDudeLife

Mic 1972 wrote: »

The Daft report for Q4 sales is showing a significant increase in YOY prices.
Not only there was no price drop in 2020, prices went up a lot

https://ww1.daft.ie/report/2020-Q4-houseprice-daftreport.pdf?d_rd=1

Report metrics are based on asking prices which is thrash.

I've been monitoring the area i grew up in Dublin on PPR and since the end of 2019, sales prices have actually dropped roughly 6-7%. This of course does not apply for all of Dublin.

HotDudeLife

Marius34 wrote: »

It's 10Billion of additional savings in short time of period. Whether it's additional 10K Euro for 1 million people, or 100K Euro for 100.000 people, it's a large increase what ever way you look.
You can expect that not all planning to buy property, but even if it's 10% of those people, that makes a significant difference.

Very marginal, like i said if a person were nowhere near in a position to buy 9 months ago and even if they saved every penny since, they would still not be in a position to make an impact on the market. Not everyone has the discipline to save like that and many are shortsighted and will just waste savings on clothes, gigs, travel etc when restrictions are lifted.

Timing belt

Villa05 wrote: »

Those measures are being continually circumvented by Govt policy
Ftb grant
Shared ownership
If the isuue is confined to our cities, which for the most part I agree with. It shows how easy the problem is to solve

By increasing supply in those areas and it does not require huge amounts to restore supply/demand imbalance if freeing up air bnb's stabilised rents in Dublin

Instead we are spending billions annually tinkering around the edges propping up rents and prices

The central bank rules on LTI & LTV have allowances built in that allow the banks to break the rules for a small portion of new mortgages.
i.e

LTV limit
FTBs: 90% with 5% of new mortgages above the limit,
SSBs: 80% with 20% of new mortgages above the limit,
BTL: 70% with 10% of new mortgages above the limit

LTI limit
3.5 with the following share of new mortgages above this limit:
FTBs: 20%,
SSBs:10%

Source : page 103 of the Vulnerabilities in the residential real estate sectors of the EEA countries Report published September 2019

yes the government need to increase supply everyone knows this and it is also know that it is a slow process which is compounded by uncertainty and because of this decision are delayed as no-one wants to build at a loss. The government schemes of HTB and shared ownership are there to provide confidence that the properties will be built at a profit and thereby increasing the speed at which the supply comes to the market.

HAP is there to address what is meant to be a short term issue and provide housing assistance until sufficient supply comes on line. Somewhere along the way this has lost its purpose of being short term and has become a permanent fixture with the government guaranteeing rent for the foreseeable and contributing to high level of rents we see in the market. To further compound the impact of this policy if you try and increase social housing it impacts FTB by reducing the housing supply available whether it is less non-social houses being built or being out bid by the government/housing association that is on the open market.

On top of this that institutional investors are being forced into different asset classes as they chase yield (A consequence of QE) and you have a low risk investment that is providing a strong yield thanks to shortage of supply in a property market that is not elastic.

It is a perfect storm and you need to remember that total population is split with 2/3 being home owners and 1/3 renting so any government decision or policy will be influenced by this split.
e.g.
1/3 of population are house owners with no mortgage
1/3 of population are house owners with a mortgage
1/3 renting.

The final point on the topic is that this is not just a issue in Ireland it is happening right across the developed economies of the world. The report I linked to above highlights the risks in residential property in each of the European countries and Ireland fair much better than most. Maybe that is as the down to the fact that the report states that the Central Bank of Ireland’s own valuation metrics indicate that house prices are now in line with or just above values justified by economic fundamentals

fliball123

Villa05 wrote: »

Those measures are being continually circumvented by Govt policy
Ftb grant
Shared ownership
If the isuue is confined to our cities, which for the most part I agree with. It shows how easy the problem is to solve

By increasing supply in those areas and it does not require huge amounts to restore supply/demand imbalance if freeing up air bnb's stabilised rents in Dublin

Instead we are spending billions annually tinkering around the edges propping up rents and prices

Yeah but in most other first world countries people can borrow up to 5 times their salary we are still not borrowing as much. I dont think increasing the supply is as easy as you think and who are you to tell a person who owns a property what to do with it? if people want to live, rent or airBnb the hell out of their property that is their business.

Also heard a few stats on Newstalk there we had an extra 10k people nett hired by multinationals last year so all the talk of them making masses redundant are unfounded and our saving rates up to November or last year ballooned up to 124k Billion in personal savings account and 72 billion in business savings accounts. Thats a lot of savings..Then on the same program a very sad discussion and interviews with 100s living on the street in inner city Dublin in around the gaiety theater who wont go into hostels as its full of drugs and prefer to stay on the street in this horrible freezing weather. So should the government stop snapping up property and just let these people die ?? 2 died over xmas in the cold in Dublin. This is where the government are in a catch 22 situation