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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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PropQueries

schmittel wrote: »

WFH here to stay:

https://www.irishtimes.com/news/ireland/irish-news/new-laws-will-give-employees-in-the-state-the-option-to-permanently-work-from-home-1.4458770

I wonder how this would play out under EU law? Can an Irish company really force someone to live in Ireland if they're WFH permanently? Especially since Ireland is only a 2 to 4 hour Ryanair plane ride away from most other EU countries. Not much more commuting time, in many cases, than commuting from Galway to Dublin for an important meeting etc.?

With our government worried about the impact of the upcoming OECD tax reforms on our future corporation taxes, maybe they should be more worried about the future income tax competition from the Mediterranean countries who are already trying to lure remote workers with tax breaks etc.

Given how reliant we are on our relatively high income taxes and will be on future carbon taxes, property taxes etc., this could cause more problems than anything the OECD tax reforms throw at us over the next two years.

Link to CNBC article on Greece income tax breaks for remote workers here: https://www.cnbc.com/2020/11/12/greece-to-cut-taxes-for-remote-workers-in-post-covid-recovery-effort.html

Cyrus

PropQueries wrote: »

Many workers now have up to an extra two hours a day to play with due to less commuting etc. Maybe they are using that time to seek additional approvals so it wouldn't be impacting much on their "productivity".

it takes 15 min to get AIP

and why are you putting productivity in inverted commas?

Cyrus

PropQueries wrote: »

I wonder how this would play out under EU law? Can an Irish company really force someone to live in Ireland if they're WFH permanently?

yes

there is a broader answer here regarding permanent establishments for tax etc but you can look into it yourself.

Mic 1972

PropQueries wrote: »

Many workers now have up to an extra two hours a day to play with due to less commuting etc. Maybe they are using that time to seek additional approvals so it wouldn't be impacting much on their "productivity".

I work from home, the time that I save for commuting I now use it to cook as I no longer have a canteen

PropQueries

Cyrus wrote: »

yes

there is a broader answer here regarding permanent establishments for tax etc but you can look into it yourself.

Well, given that it's only now that the Irish and other EU countries are looking into updating their WFH laws to reflect this new reality, I don't believe tax residency etc. to keep workers tied to Ireland will play out at an EU level much longer, especially if the relatively low cost countries in the EU spot an opportunity to gain from the WFH.

tigger123

Cyrus wrote: »

yes

there is a broader answer here regarding permanent establishments for tax etc but you can look into it yourself.

I would imagine that any rules regarding WFH would/could include that you must be ordinarily resident in the State, and that you can be called to attend the workplace at short notice, should it be required.

I highly doubt it will be a cart blanche to live on a Mediterranean Island.

Cyrus

PropQueries wrote: »

Well, given that it's only now that the Irish and other EU countries are looking into updating their WFH laws to reflect this new reality, I don't believe tax residency etc. to keep workers tied to Ireland will play out at an EU level much longer, especially if the relatively low cost countries in the EU spot an opportunity to gain from the WFH.

i think you are utterly misguided in this regard.

Mic 1972

tigger123 wrote: »

I would imagine that any rules regarding WFH would/could include that you must be ordinarily resident in the State, and that you can be called to attend the workplace at short notice, should it be required.

I highly doubt it will be a cart blanche to live on a Mediterranean Island.

In order to pay tax in Ireland an employee must work at least 6 months in Ireland. Companies can however applying further limitations to that.

I was hired into a WFH position with no space for me in the office, however I need to sign companies forms and get approvals to work from another country for limited time

PropQueries

Mic 1972 wrote: »

In order to pay tax in Ireland an employee must work at least 6 months in Ireland. Companies can however applying further limitations to that.

I was hired into a WFH position with no space for me in the office, however I need to sign companies forms and get approvals to work from another country for limited time

Isn't that the same kind of logic as saying back in say 1860 that the motor car will never take off because the laws, regulations, infrastructure etc. don't currently allow for it?

Timing belt

PropQueries wrote: »

Well, given that it's only now that the Irish and other EU countries are looking into updating their WFH laws to reflect this new reality, I don't believe tax residency etc. to keep workers tied to Ireland will play out at an EU level much longer, especially if the relatively low cost countries in the EU spot an opportunity to gain from the WFH.

what are you are implying isa standard Eu tax at all levels...if that is adopted the there might be validity in what you are claiming.... maybe you should read up on the topic

Cyrus

PropQueries wrote: »

Isn't that the same kind of logic as saying back in say 1860 that the motor car will never take off because the laws, regulations, infrastructure etc. don't currently allow for it?

no its not.

PropQueries

tigger123 wrote: »

I would imagine that any rules regarding WFH would/could include that you must be ordinarily resident in the State, and that you can be called to attend the workplace at short notice, should it be required.

I highly doubt it will be a cart blanche to live on a Mediterranean Island.

I'm not sure that workers who are allowed to WFH permanently would be in such a work environment that they are required to attend the office with 4 hours notice. They may be told on Monday that they need to be in the office on Thursday. Plenty of time to book a Ryanair flight and be there in time for such meetings. And probably not costing much more than driving from Letterkenny to Dublin.

PropQueries

Timing belt wrote: »

what are you are implying isa standard Eu tax at all levels...if that is adopted the there might be validity in what you are claiming.... maybe you should read up on the topic

No. I'm saying that the Mediterranean and eastern EU countries have a lot to gain by forcing through EU laws to allow remote workers to work from anywhere they wish in the EU if they're WFH permanently.

We can't compete with their low living costs due to our legacy problems e.g. pension promises, housing costs etc.

They know they can outcompete Ireland at every level and it would be in their interest to ensure this is enshrined in EU law.

In the Irish Times today, the new Irish laws will "give employees in the State the option to permanently work from home". We're already starting to update our laws so it's only a small extra step to what I'm suggesting will most likely happen.

hometruths

Cyrus wrote: »

id say the devil will be in the detail, look at the headline you quoted, gives employees the right to request to WFH, what does that even mean?

No doubt the devil is in the detail, but the big picture is nonetheless interesting: the government is positioning policy changes to maximise WFH where possible.

One of their key pillars is heavy investment in regional infrastructure to create as conducive an environment as possible for both employees and employers to embrace WFH.

This will accelerate the trend of internal migration in Ireland out of Dublin - this is what the government is trying to achieve.

I'm quick to criticise them when they introduce half baked policy with obvious unintended consequences, so credit where it is due, I think this is a good initiative by government.

Browney7

Cyrus wrote: »

it takes 15 min to get AIP

and why are you putting productivity in inverted commas?

In fairness, anytime two years ago I applied for mortgage approval or express an interest I was prompted to come into a branch or a cafe for a chat so had to schedule in a face to face so didn't apply to many institutions. Maybe it is easier now to get multiple approvals bit whether this is skewing stats is unknown. No one can categorically say yes or no.

Hubertj

schmittel wrote: »

No doubt the devil is in the detail, but the big picture is nonetheless interesting: the government is positioning policy changes to maximise WFH where possible.

One of their key pillars is heavy investment in regional infrastructure to create as conducive an environment as possible for both employees and employers to embrace WFH.

This will accelerate the trend of internal migration in Ireland out of Dublin - this is what the government is trying to achieve.

I'm quick to criticise them when they introduce half baked policy with obvious unintended consequences, so credit where it is due, I think this is a good initiative by government.

Definitely opens opportunities for people to make lifestyle changes. Only not of caution would be how policies differ between employers. For example, current employer might allow full wfh or only 1 day in office requirement. Based on that you move to clifden or roundstone. You then change job for some reason (redundancy, career progression etc) and are required in office 3 days a week. Clifden to Dublin is not feasible multiple days per week despite what some have suggested in the past.
Big decision to make but good to have the option to consider it.

fliball123

PropQueries wrote: »

Well, I think it would be interesting if the data was there to look at. Two years ago, people might have applied to 2 or 3 lenders seeking approval. Now they might apply to 4 or 5.

The approvals statistics might then show that e.g. 3,000 unique people were approved for a mortgage in November, when it may have only being e.g. 1,500.

It's a big difference when attempting to predict future demand for housing and would be especially important to developers when planning their construction targets for 2021?

Where are you getting this bull why would someone a few years ago suddenly jump to 4 or 5 from 2 to 3 my god your really spinning there slow down your going to make yourself dizzy

odyssey06

I thought I read something to the effect that multinationals need to have certain employees based in Ireland to qualify to be taxed under Irish corporate tax rates... They might be ok with some exceptional cases of employees working from another EU country, but not as a general policy.

Cyrus

Hubertj wrote: »

Definitely opens opportunities for people to make lifestyle changes. Only not of caution would be how policies differ between employers. For example, current employer might allow full wfh or only 1 day in office requirement. Based on that you move to clifden or roundstone. You then change job for some reason (redundancy, career progression etc) and are required in office 3 days a week. Clifden to Dublin is not feasible multiple days per week despite what some have suggested in the past.
Big decision to make but good to have the option to consider it.

indeed, the thing that stopped me moving back down to where i grew up (from a work perspective i mean, there were other factors too) is that i might get one job at a similar level but if something happened getting another one would be difficult.

hometruths

odyssey06 wrote: »

I thought I read something to the effect that multinationals need to have certain employees based in Ireland to qualify to be taxed under Irish corporate tax rates... They might be ok with some exceptional cases of employees working from another EU country, but not as a general policy.

This idea about people suddenly working from the beach abroad sipping pina coladas is a ridiculous red herring.

The impact will be felt because a certain amount of people who may intend to buy or have already bought in Dublin/Kildare/Wicklow/Meath etc will now be able to consider options further afield within Ireland.

Cyrus

schmittel wrote: »

This idea about people suddenly working from the beach abroad sipping pina coladas is a ridiculous red herring.

i wonder who introduced that line of debate?

PropQueries

fliball123 wrote: »

Where are you getting this bull why would someone a few years ago suddenly jump to 4 or 5 from 2 to 3 my god your really spinning there slow down your going to make yourself dizzy

The internet. More advanced online meeting tools e.g. zoom, skype etc.

A bit quicker than a few years ago.

PropQueries

schmittel wrote: »

This idea about people suddenly working from the beach abroad sipping pina coladas is a ridiculous red herring.

The impact will be felt because a certain amount of people who may intend to buy or have already bought in Dublin/Kildare/Wicklow/Meath etc will now be able to consider options further afield within Ireland.

I don't think people are saying they will be working from the beach. But after work, yes, they can walk down to the beach and sip pina coladas

Much better than WFH here and opening the front door at 5 p.m. to cold, rain and wind IMO

And, if they're offered income tax breaks, all the better

PommieBast

Browney7 wrote: »

The landlords of boards.ie need a 6% minimum rental yield to pay them and compensate them for the remote risk of a rogue tenant blowing their house up so it'll be interesting to see how low yields go and whether it will be fuelled by reducing rents or increasing property values.

Out of interest what is the going rate for insuring against this, or is it one of those things underwriters will not touch with a barge-pole?

odyssey06

schmittel wrote: »

This idea about people suddenly working from the beach abroad sipping pina coladas is a ridiculous red herring. The impact will be felt because a certain amount of people who may intend to buy or have already bought in Dublin/Kildare/Wicklow/Meath etc will now be able to consider options further afield within Ireland.

I only post about Pina Coladas on the appropriate thread, so not sure where this ridiculous strawman you present came from.

Tech companies have staff hired in from other EU countries, in large numbers.
You think they don't want to WFH too, where home is their home country?
Some of them were already doing so on the QT during the pandemic.

Browney7

PommieBast wrote: »

Out of interest what is the going rate for insuring against this, or is it one of those things underwriters will not touch with a barge-pole?

I was being facetious of course (blowing the house up would actually be covered by property insurance).

Looking at RTB stats, 1 in a 100 tenancies seem to have a dispute opened by a landlord (overholding, non payment of rent, anti social etc). A fair point on top of this is that many landlords won't pursue small amounts or just be happy once the tenant leaves etc and may actually pay a tenant to leave. So a reasonable probability is that a random tenancy running into tenancy issues will be between 1 in 50 and 1 in a 100.

No insurance product exists in the market to cover non payment of rent. Nothing to stop landlords getting creative and creating a mutual scheme amongst themselves if there was appetite for it

awec

PropQueries wrote: »

I wonder how this would play out under EU law? Can an Irish company really force someone to live in Ireland if they're WFH permanently? Especially since Ireland is only a 2 to 4 hour Ryanair plane ride away from most other EU countries. Not much more commuting time, in many cases, than commuting from Galway to Dublin for an important meeting etc.?

Why on earth wouldn't they be?

It has absolutely nothing whatsoever to do with commuting time. But you already know this.

fliball123

PropQueries wrote: »

The internet. More advanced online meeting tools e.g. zoom, skype etc.

A bit quicker than a few years ago.

Skype is here over 10 years ,internet even longer. Poeple have been able to go through mortgage approvals online for 8/9 years now at least if not longer. I cant see a reason why suddenly in 2020 why the jump to 4/5 approvals per person would be true. You have absolutely no evidence of it so unless you do please stop using your thinking to be truth.

Cyrus

PropQueries wrote: »

I wonder how this would play out under EU law? Can an Irish company really force someone to live in Ireland if they're WFH permanently? Especially since Ireland is only a 2 to 4 hour Ryanair plane ride away from most other EU countries. Not much more commuting time, in many cases, than commuting from Galway to Dublin for an important meeting etc.?

With our government worried about the impact of the upcoming OECD tax reforms on our future corporation taxes, maybe they should be more worried about the future income tax competition from the Mediterranean countries who are already trying to lure remote workers with tax breaks etc.

Given how reliant we are on our relatively high income taxes and will be on future carbon taxes, property taxes etc., this could cause more problems than anything the OECD tax reforms throw at us over the next two years.

Link to CNBC article on Greece income tax breaks for remote workers here: https://www.cnbc.com/2020/11/12/greece-to-cut-taxes-for-remote-workers-in-post-covid-recovery-effort.html

do you read the articles you post?

We are targeting companies that want to open offices in Greece due to Brexit, Greeks abroad who want to return to Greece, digital migrants or tech companies; anybody or any company that wants to open (an) office in Greece

thats not an other tech worker who works for google ireland decided to move to athens for a year, its to incentivise co's to set up a base there, a permanent establishment.

PropQueries

fliball123 wrote: »

Skype is here over 10 years ,internet even longer. Poeple have been able to go through mortgage approvals online for 8/9 years now at least if not longer. I cant see a reason why suddenly in 2020 why the jump to 4/5 approvals per person would be true. You have absolutely no evidence of it so unless you do please stop using your thinking to be truth.

And that's why I initially asked "I think it would be interesting if the data was there to look at"

But based on how easy and less intimidating the banks make applying for approval these days and especially during the pandemic (e.g. no face to face meetings), it's a reasonable assumption that once someone applies for and gets approval from one bank, they're more inclined to apply to several others after giving how easy it was the first time?