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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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Villa05

Zenify wrote:

Debt cannot keep growing indefinitely at hight rates. I understand the principle of what economists say about it but they aren't forecasting the unforeseen. What about the next crisis and the one after that? With higher debts we have less firepower for each new unforeseen crises. Eventually the straw will break the camels back Ã°Å¸Â«

What?
There's no magic money tree :-)

Zenify

fliball123 wrote: »

If we all took that approach no one would ever take a risk at any time. But to put it in context in the last crash we should not of borrowed the 200 billion for banks and for the ballooning of ps pay and welfare that preceded the last crash. The banks were an absolute bunch of underhanded thieves and the ps pay /pensions and welfare were not just adding to the debt but the deficit at least the banks were a one off payment. We were also being charged a fairly high interest rate at the time. So to look at the 30 billion we are borrowing between 2020 and 2021 To get 30 billion of an interest free loan at a time when the government have stopped a fair % of people working and while there is a world wide pandemic is actually the correct thing to do.

I agree with all of that, and that it is absolutely necessary to borrow at the moment. But eventually it will catch up with us. Maybe not this time though, or maybe this continues longer than expected and it does catch up with us. All I'm saying is that these economists arguing the sustainability of high public debt levels does not factor in the unforseen.

fliball123

Zenify wrote: »

Debt cannot keep growing indefinitely at hight rates. I understand the principle of what economists say about it but they aren't forecasting the unforeseen. What about the next crisis and the one after that? With higher debts we have less firepower for each new unforeseen crises. Eventually the straw will break the camels back ðŸ«

If we all took that approach no one would ever take a risk at any time. But to put it in context in the last crash we should not of borrowed the 200 billion for banks and for the ballooning of ps pay and welfare that preceded the last crash. The banks were an absolute bunch of underhanded thieves and the ps pay /pensions and welfare were not just adding to the debt but the deficit at least the banks were a one off payment. We were also being charged a fairly high interest rate at the time. So to look at the 30 billion we are borrowing between 2020 and 2021 To get 30 billion of an interest free loan at a time when the government have stopped a fair % of people working and while there is a world wide pandemic is actually the correct thing to do.

JimmyVik

beauf wrote: »

They build them too small, and generally poor quality with problems with ventilation, sound pollution etc. They have tiny living spaces.

They have no incentive to build them big anymore.
Given that most will be bought by reits from here on in.

I have a friend who bought a 2 bed apartment in the first phase of a development. As the phases went on they got smaller.
With the same type apartments in the last phase being 200sq ft smaller than the ones in the first.
When he used to rent out his apartment he was not allowed to charge anymore than ones that were far smaller than his.

Now from a Reit point of view whats the point paying for bigger than you need if you cant charge more for it.
So more, smaller apartments will be built from now on.
Theyve even changed the planning laws on it to allow smaller.

Zenify

Debt cannot keep growing indefinitely at hight rates. I understand the principle of what economists say about it but they aren't forecasting the unforeseen. What about the next crisis and the one after that? With higher debts we have less firepower for each new unforeseen crises. Eventually the straw will break the camels back ðŸ«

fliball123

Wanderer78 wrote: »

...our growing deficits arent really a problem anyway, private debt is the far more dangerous one, and would more than likely cause far more serious problems, if we cant manage to continually service them

Well I would argue they were a problem as it was adding year on year to our debt. What is the ratio of private debt to private savings in the country. Our private debt to GDP ratio has been coming down over the last number of years and our private savings are at record highs. I think we will survive

https://www.ceicdata.com/en/indicator/ireland/household-debt--of-nominal-gdp

https://www.irishtimes.com/business/economy/household-savings-at-an-extraordinary-level-1.4440586

Wanderer78

fliball123 wrote: »

What do you want the government to do.. Say here feck it lads lets not take the money at zero % let all the companies go to the wall and lets rewind the clock back 12 years and start cutting everything and upping taxes..The rest of the world are doing exactly what we are doing and Austerity was a proven failure. There will be no effect as the debt will be rolled over again and again and when enough time has passed it will not be as big a problem as it is now. You only have to look at the last crash we came out of it with 200billion of debt and people were saying we are doomed yet 10/12 years on the debt is/was being serviced and it didnt really have much of a sway with our finances in that 10/12 years we managed to plug a 20 Billion deficit to actually being able to have a 1.5Billion rainy day fund in 2019 along with being able to top up over and over again in areas like health. So another 30 Billion on top of this is not going to break the bank here

...our growing deficits arent really a problem anyway, private debt is the far more dangerous one, and would more than likely cause far more serious problems, if we cant manage to continually service them

fliball123

bubblypop wrote: »

Well, there are not as many properties in the market.
People haven't felt any pinch yet as the government are keeping the economy going.
I imagine the effect of this pandemic won't be seen economically until at least 2022 and on.

What do you want the government to do.. Say here feck it lads lets not take the money at zero % let all the companies go to the wall and lets rewind the clock back 12 years and start cutting everything and upping taxes..The rest of the world are doing exactly what we are doing and Austerity was a proven failure. There will be no effect as the debt will be rolled over again and again and when enough time has passed it will not be as big a problem as it is now. You only have to look at the last crash we came out of it with 200billion of debt and people were saying we are doomed yet 10/12 years on the debt is/was being serviced and it didnt really have much of a sway with our finances in that 10/12 years we managed to plug a 20 Billion deficit to actually being able to have a 1.5Billion rainy day fund in 2019 along with being able to top up over and over again in areas like health. So another 30 Billion on top of this is not going to break the bank here

fliball123

Timing belt wrote: »

Central Banks Q1 Bulletin released today

https://www.centralbank.ie/docs/default-source/publications/quarterly-bulletins/qb-archive/2021/quarterly-bulletin-q1-2021.pdf?sfvrsn=5

In relation to property this is the main element
Residential property
"Construction sector activity rebounded following the closure of sites in April and May 2020 (Figure 8). While housing output is down on preCOVID expectations, completions are on course to reach approximately 18,500 new units in 2020. New housing starts are estimated to have numbered around 22,000 by the end of 2020. Factoring in the temporary closure of non-essential construction for January 2021, new house completions of around 21,500 and 23,500 are forecast for 2021 and 2022, respectively. If site closures extend significantly beyond the current announced period, these forecasts would be negatively impacted. "

Unemployment is expected to increase to 9.3% in 2021 from 6.2% in 2020

GDP for 2020 estimated at 2.5% (3.8% 2021)
modified domestic demand for 2020 -7.1% (2.9% 2021)
consumer spending down 8.3%

Mortgages
New mortgage lending dropped substantially in the initial phase of the pandemic, before recovering in the second half of the year. In September, new mortgage agreements were back on par with March 2020, but 13.8 per cent below 2019 levels. By end-November, mortgage agreements had further increased, rising by 22.3 per cent from September’s level, and were marginally higher than in November 2019. Forward looking indicators also point to a solid recovery in mortgage market activity, with approvals 24.3 per cent higher on an annual basis in November. The higher approval numbers may be inflated by re-approvals of applications that expired during the earlier lockdown-periods in 2020. Banks are also reporting an increase in demand and this is reflective of a less adverse impact of the COVID-19 shock on the demand for housing than was originally expected at the onset of the pandemic.

Think that is all the main points but will go through the report tomorrow in more detail

So 18.5k are on course to be completed I wonder if the lockdown before xmas and even the one after it will bring this number down. So much for PropsQueries assumption of 21k new house completions. I kept telling him it would not be that much I think I put a figure of 17k to 18k.

fliball123

Deleted User wrote: »

People haven't seen the effect of it. PUP payments, mortgage freezes, free money, nothing has changed. Yet.

You mean a lot of people have not been affected by PUP , mortgage freezes and have actually saved quite a bit record level savings in the bank.

Villa05

combat14 wrote:

looks like this pandemic wont be over a while

It truly is amazing how miserable the Western world has been at fighting this virus. Are they as bad as us in pandering to vested interests in opening up too early

I mean how difficult is it to
Wash your hands regularly, wear a mask
And
Test, trace, isolate

It really does not give you any confidence that the world economy is in good hands

combat14

looks like this pandemic wont be over a while

https://www.rte.ie/news/2021/0122/1191331-covid-eu-variants-concern/

who knows how things will hop, the longer it goes on the graver the risk for the european, world and irish economy

Wanderer78

fin12 wrote:

Can anyone explain in a global pandemic how house prices have actually increased? Has this happened in any other country in the world?

Still plenty of access to credit and savings about, pushing up prices

[Deleted User]

fin12 wrote: »

Can anyone explain in a global pandemic how house prices have actually increased? Has this happened in any other country in the world?

Well, there are not as many properties in the market.
People haven't felt any pinch yet as the government are keeping the economy going.
I imagine the effect of this pandemic won't be seen economically until at least 2022 and on.

Timing belt

Central Banks Q1 Bulletin released today

https://www.centralbank.ie/docs/default-source/publications/quarterly-bulletins/qb-archive/2021/quarterly-bulletin-q1-2021.pdf?sfvrsn=5

In relation to property this is the main element
Residential property

"Construction sector activity rebounded following the closure of sites in April and May 2020 (Figure 8). While housing output is down on preCOVID expectations, completions are on course to reach approximately 18,500 new units in 2020. New housing starts are estimated to have numbered around 22,000 by the end of 2020. Factoring in the temporary closure of non-essential construction for January 2021, new house completions of around 21,500 and 23,500 are forecast for 2021 and 2022, respectively. If site closures extend significantly beyond the current announced period, these forecasts would be negatively impacted. "

Unemployment is expected to increase to 9.3% in 2021 from 6.2% in 2020

GDP for 2020 estimated at 2.5% (3.8% 2021)
modified domestic demand for 2020 -7.1% (2.9% 2021)
consumer spending down 8.3%

Mortgages

New mortgage lending dropped substantially in the initial phase of the pandemic, before recovering in the second half of the year. In September, new mortgage agreements were back on par with March 2020, but 13.8 per cent below 2019 levels. By end-November, mortgage agreements had further increased, rising by 22.3 per cent from September’s level, and were marginally higher than in November 2019. Forward looking indicators also point to a solid recovery in mortgage market activity, with approvals 24.3 per cent higher on an annual basis in November. The higher approval numbers may be inflated by re-approvals of applications that expired during the earlier lockdown-periods in 2020. Banks are also reporting an increase in demand and this is reflective of a less adverse impact of the COVID-19 shock on the demand for housing than was originally expected at the onset of the pandemic.

Think that is all the main points but will go through the report tomorrow in more detail

Geuze

fin12 wrote: »

Can anyone explain in a global pandemic how house prices have actually increased? Has this happened in any other country in the world?

Incomes are not down much.

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Savings are up:

EsCh7sqXEAIfjmi?format=png&name=medium

See Seamus Coffey.

Timing belt

fin12 wrote: »

Can anyone explain in a global pandemic how house prices have actually increased? Has this happened in any other country in the world?

house prices are up in the majority of developed countries

https://stats.bis.org/statx/srs/table/h2

[Deleted User]

People haven't seen the effect of it. PUP payments, mortgage freezes, free money, nothing has changed. Yet.

fin12

Can anyone explain in a global pandemic how house prices have actually increased? Has this happened in any other country in the world?

Graham

Mod Note

schmittel / Timing belt, enough with the digs at each other.

Do not reply to this post.

hometruths

Timing belt wrote: »

You can't move on because you feelings got hurt so you will keep harping on about the same thing because you think you are right. I have challenged you to find data that does not look at no of rooms if you can't find it then move on.... your anger and need to be right is funny to look at :D:D:D

More irony! I am not looking for any other data because I am still working off the original eurostat data that you posted, linked and based the claim on - the data is telling us...etc

Timing belt wrote: »

The data is telling us that we are consistent over the past 10 years and that most of the under-occupied houses are in rural areas with people 65+

When that claim was first challenged, it was about that data.

schmittel wrote: »

Really? That’s not what it is telling me.

One of us is interpreting the data to suit our narrative.

Of course, it might be me, but the stats site not very tablet friendly so will have to wait until the morning until I can look at it closer before I can check if I’m the blinkered/thick one!

So again I’d point out your claim is mathematically impossible. You made that claim based on eurostat data. You quoted it at length and linked it. You’ve since looked at other data and tried to shoehorn your assumptions to fit your original claim based on different data.

That just makes you look foolish. And like you spin, manipulate and misrepresent data to suit your narrative.

It’s not a good look.

Timing belt

schmittel wrote: »

Sure. I can do that.

The question is are the majority of underoccupied houses in rural areas?

7/10 people in Ireland live in underoccupied houses. Eurostat data.
3/10 people in Ireland live in rural areas. Eurostat data.

Ergo even if 100% of people living in rural Ireland lived in an underoccupied house it is still mathematically impossible for the majority of the underoccupied houses to be in rural Ireland.

QED.

You can't move on because you feelings got hurt so you will keep harping on about the same thing because you think you are right. I have challenged you to find data that does not look at no of rooms if you can't find it then move on.... your anger and need to be right is funny to look at

:D:D:D

hometruths

Timing belt wrote: »

There is no clutching at straws.... If you have better assumptions and data share them... The number of people per housing unit is a good indicator..So unless you share data that proves otherwiseand not the data on no of rooms per house... then move on... Go back and look at your vacant property and work out how that will solve the housing crisis.... but oh yeah you don't think we have one!!!!

Sure. I can do that.

The question is are the majority of underoccupied houses in rural areas?

7/10 people in Ireland live in underoccupied houses. Eurostat data.
3/10 people in Ireland live in rural areas. Eurostat data.

Ergo even if 100% of people living in rural Ireland lived in an underoccupied house it is still mathematically impossible for the majority of the underoccupied houses to be in rural Ireland.

QED.

Timing belt

L1011 wrote: »

I suspect the banks with physical branches may return to how it was the pre-computerisation era and have more staff actually working in the office space in branch buildings - but this time able to work there due to modern networks; not having to work there to handle paper.

If you're a bank with a branch in, say, Trim with space for 6 more desks and happen to have 6 staff commuting every day from Trim and surrounding areas to D4 - staff you now know can work remote from HQ due to the last year - but still want them to go to an office for presenteeism obsession reasons, just get them to use the branch building. Could also cross-subsidse the running costs of more marginal branches.

It will be interesting to see what they do... If they do use branches more... Aib are aiming at saving 1.3bn in costs by 2023.... would they ever introduce different pay scales based on locations to try and achieve this.

Timing belt

schmittel wrote: »

updated data based on some rather odd assumptions such as detached houses should have 4 people living in them, semi Ds should have 3 people living in them and apartments should have 2 people?! clutching at straws moving the goalposts as it were.

There is no clutching at straws.... If you have better assumptions and data share them... The number of people per housing unit is a good indicator..So unless you share data that proves otherwise and not the data on no of rooms per house... then move on... Go back and look at your vacant property and work out how that will solve the housing crisis.... but oh yeah you don't think we have one!!!!

L1011

I suspect the banks with physical branches may return to how it was the pre-computerisation era and have more staff actually working in the office space in branch buildings - but this time able to work there due to modern networks; not having to work there to handle paper.

If you're a bank with a branch in, say, Trim with space for 6 more desks and happen to have 6 staff commuting every day from Trim and surrounding areas to D4 - staff you now know can work remote from HQ due to the last year - but still want them to go to an office for presenteeism obsession reasons, just get them to use the branch building. Could also cross-subsidse the running costs of more marginal branches.

hometruths

Timing belt wrote: »

what are you trying to prove? I have shared updated data which provides a clearer picture.....

updated data based on some rather odd assumptions such as detached houses should have 4 people living in them, semi Ds should have 3 people living in them and apartments should have 2 people?! clutching at straws moving the goalposts as it were.

Speaking of ironic...

Timing belt wrote: »

The figures are from 2011 - 2016 so yet again you are moving the goal posts.

And yet more irony..

Timing belt wrote: »

So as I said move on...

Timing belt wrote: »

Why not change the topic now that you are not able to back up your figures.... Lets hope people forget and you can use them again in a few weeks...

I’m not trying to prove anything. I don’t need to. The data speaks for itself no matter how you spin, manipulate or misrepresent it.

It is mathematically impossible for the majority of the underoccupied houses to be in rural areas. But you know that. You’re not stupid. You just made a mistake. It’s ok, we all do it.

Timing belt

AIB looking to exit 50% of Dublin office Space by 2023

They are also looking at cutting overall office space by 40% which would indicate that staff in roles that could WFH would only be in the office 2 days a week if 30% of the staff were in roles that did not facilitate WFH

Timing belt

schmittel wrote: »

Yes I understand the data I’m looking at.

I’m looking at the data you posted last night and based on which you made the claims about 65+ and rural. Didn’t spot the number of people per unit on that data.

This data tells us that 7/10 people in Ireland live in underoccupied housing.

So I’ll ask you a simple question again - if 7/10 people in Ireland live in underoccupied housing, how is it possible that the majority of those people live in rural areas?

what are you trying to prove? I have shared updated data which provides a clearer picture..... So as I said move on...

hometruths

Timing belt wrote: »

Do you understand the data that you are looking at?

You are looking at no of rooms per house which I have already shown is not relevant as we have different housing stock the rest of Europe.
i.e.
We have more houses they have more apartments.... Its like comparing apples and oranges.

If you look at the number of people per housing unit you will see this is a better indicator of under-occupancy.

This is about the 10 time I have pointed this out to you......Time to move on..

Yes I understand the data I’m looking at.

I’m looking at the data you posted last night and based on which you made the claims about 65+ and rural. Didn’t spot the number of people per unit on that data.

This data tells us that 7/10 people in Ireland live in underoccupied housing.

So I’ll ask you a simple question again - if 7/10 people in Ireland live in underoccupied housing, how is it possible that the majority of those people live in rural areas?