2021 Irish Property Market chat - mod warnings post 1

PropQueries · 03-02-2021 02:01PM

awec wrote: »

Firstly, I really wish you'd stop posting pure supposition as if it was fact.

The whole point of HTB was to increase developer margins to encourage them to build more. It was never really a secret. People who use it are taxpayers too. You can only get back what you've paid in yourself.

On the one hand, you say that HTB does nothing except increase developer margins, and on the other you said higher margins don't encourage them to build more. Somehow in your head this adds up.

In relation to my quote "And once HTB is removed (obvious due to budget constraints in 5 years time), any house purchased under HTB will be worth a minimum c. €100k less in 5 years time than today.".

The Chancellor in the UK has already well signaled that his going to start increasing both corporation taxes and CGT in the UK. Biden in the USA is already moving full steam ahead with his buy american and keep jobs in america program.

Given how reliant Ireland is on our corporation taxes to keep the show on the road, it's highly unlikely (IMO), that the new OECD global tax rules (still in negotiations) will allow countries like Ireland to continue to use low taxes as a means to attract UK, EU and American companies to our shores. The larger economies need both the tax revenues and the jobs, now more than ever after the covid-19 costs.

There is no point in Rishi Sunak increasing these taxes in the UK while allowing their bigger companies to avoid them by using bases such as Ireland IMO

Our pension costs are also going to keep increasing every year so cuts to government expenditure appear to be the only logical outcome over the next few years so HTB schemes etc. would most likely be first on the chopping block IMO.

TheSheriff · 03-02-2021 02:01PM

PropQueries wrote: »

HTB won't encourage development by the bigger developers as the bigger players e.g. Cairn Homes, Glenveagh etc. purchased their landbanks for a pittance many years ago.

Cairn Homes stated last September that their average site cost was c. €30k and that many of their sites were purchased for c. €15k.

That means, given that construction wages and materials haven't increased by zimbabwean levels of inflation over the past 5 years that they could easily sell their new built houses today for about 20% more than 2015 prices and still walk away with a higher profit margin than in 2015.

If they were willing to accept a lower profit margin in 2015, what has changed, that they now require a higher profit margin with this higher profit margin being paid directly by the state i.e. me?

The only outcome from HTB will be to increase developer profit margins and keep site costs artificially high.

And once HTB is removed (obvious due to budget constraints in 5 years time), any house purchased under HTB will be worth a minimum c. €100k less in 5 years time than today.

Yet another fabricated claim portrayed at fact.

In five years times we could just as easily have another version of HTB and a new build bought today could be worth 100k more.

MacronvFrugals · 03-02-2021 02:05PM

Lol as I said before just talk to any of the lads working for these contractors about how many backhanders and the like going on.

Councillors submit emergency motion calling for audit of Dublin City Council housing bill

The emergency motion has directed Owen Keegan, chief executive of Dublin City Council, to undertake an “immediate external audit” on exact construction costs paid by the local authority in the delivery of social housing.

James Geoghegan, a Fine Gael councillor, said the fact a “premium price” is being charged by private housing contractors for the delivery of social housing is “an alarming development”.

“There are over 5,000 homes that Dublin City Council has said are either at a preliminary or advanced stage of planning for social housing,” he said.

https://www.businesspost.ie/houses/councillors-submit-emergency-motion-calling-for-audit-of-dublin-city-council-housing-bill-6081aed2?auth=login

Timing belt · 03-02-2021 02:16PM

PropQueries wrote: »

In relation to my quote "And once HTB is removed (obvious due to budget constraints in 5 years time), any house purchased under HTB will be worth a minimum c. €100k less in 5 years time than today.".

The Chancellor in the UK has already well signaled that his going to start increasing both corporation taxes and CGT in the UK. Biden in the USA is already moving full steam ahead with his buy american and keep jobs in america program.

Even the most staunch Democrats admit that they are not in a position in the US to increase taxes because of the state of the economy. To imply otherwise is misleading.

The UK is in a totally different situation as they will be looking to make changes to tax that they were previously unable to make due to being in the EU. Even though saying that I think they will have difficulty making changes without the EU claiming it gives them a unfair advantage and retaliate by imposing restrictions on financial services.

The IMF have already come out and advised against raising taxes at the moment so its not as black and white as you make it.

awec · 03-02-2021 02:16PM

PropQueries wrote: »

In relation to my quote "And once HTB is removed (obvious due to budget constraints in 5 years time), any house purchased under HTB will be worth a minimum c. €100k less in 5 years time than today.".

The Chancellor in the UK has already well signaled that his going to start increasing both corporation taxes and CGT in the UK. Biden in the USA is already moving full steam ahead with his buy american and keep jobs in america program.

Given how reliant Ireland is on our corporation taxes to keep the show on the road, it's highly unlikely (IMO), that the new OECD global tax rules (still in negotiations) will allow countries like Ireland to continue to use low taxes as a means to attract UK, EU and American companies to our shores. The larger economies need both the tax revenues and the jobs, now more than ever after the covid-19 costs.

There is no point in Rishi Sunak increasing these taxes in the UK while allowing their bigger companies to avoid them by using bases such as Ireland IMO

Our pension costs are also going to keep increasing every year so cuts to government expenditure appear to be the only logical outcome over the next few years so HTB schemes etc. would most likely be first on the chopping block IMO.

As I said, this is all supposition on your part. There is nothing to suggest that Ireland will no longer be able to attract FDI via beneficial tax schemes, again this is you putting together a story to try and come up with something that supports the narrative that you are very keen to promote.

Maybe it'll go away, maybe it won't. You haven't a notion if it will or won't, it certainly isn't obvious, nor is it obvious that suddenly houses will fall 100k in value.

Rishi Sunak is free to increase the UKs CGT and corpo tax as much as he wants. Joe Biden is not the first, nor will he be the last US President to talk about keeping jobs in America. Every time someone says it there are people here who are absolutely convinced that Ireland is finished. It was the exact same with Trump, we were going to lose all our MNC jobs when he cut their corpo tax. We were doomed.

L1011 · 03-02-2021 02:19PM

PropQueries wrote: »

And once HTB is removed (obvious due to budget constraints in 5 years time), any house purchased under HTB will be worth a minimum c. €100k less in 5 years time than today.

HTB is max 30k - where are you generating the extra 70k from?

Timing belt · 03-02-2021 02:20PM

L1011 wrote: »

HTB is max 30k - where are you generating the extra 70k from?

Its only a little rounding up as per normal.

Hubertj · 03-02-2021 02:23PM

Timing belt wrote: »

Even the most staunch Democrats admit that they are not in a position in the US to increase taxes because of the state of the economy. To imply otherwise is misleading.

The UK is in a totally different situation as they will be looking to make changes to tax that they were previously unable to make due to being in the EU. Even though saying that I think they will have difficulty making changes without the EU claiming it gives them a unfair advantage and retaliate by imposing restrictions on financial services.

The IMF have already come out and advised against raising taxes at the moment so its not as black and white as you make it.

AmCham released information on Bidens buy American bill. Minimal impact on Ireland due to the nature of the good produced here.
Only an idiot would suggest MNCs haven’t already considered future tax development when making expansion or employment decisions in a country. Or maybe google and Microsoft don’t have a clue.

MacronvFrugals · 03-02-2021 02:25PM

Biden is Wall's Street's guy in fairness, wouldn't be expecting any major shake ups

PropQueries · 03-02-2021 02:36PM

Timing belt wrote: »

Even the most staunch Democrats admit that they are not in a position in the US to increase taxes because of the state of the economy. To imply otherwise is misleading.

The UK is in a totally different situation as they will be looking to make changes to tax that they were previously unable to make due to being in the EU. Even though saying that I think they will have difficulty making changes without the EU claiming it gives them a unfair advantage and retaliate by imposing restrictions on financial services.

The IMF have already come out and advised against raising taxes at the moment so its not as black and white as you make it.

How will raising corporation taxes and CGT give the UK an "unfair advantage"?

PropQueries · 03-02-2021 02:36PM

L1011 wrote: »

HTB is max 30k - where are you generating the extra 70k from?

The proposed HTB is up to €100k

L1011 · 03-02-2021 02:37PM

PropQueries wrote: »

The proposed HTB is up to €100k

That's a proposed co-ownership scheme which is a vastly different product. I do hope you understand that.

The_Conductor · 03-02-2021 02:39PM

L1011 wrote: »

HTB is max 30k - where are you generating the extra 70k from?

Perhaps its the 3.5times multiplier that the lenders apply that he has in mind.

Regardless- none of us have a crystal ball.

Ireland looks set to exit the Covid emergency with the second highest debt per capita in the world. The only thing keeping our heads above the water in the short to medium term- is statements from the ECB that they intend to keep interest rates extremely low for a protracted period of time.

Arguably- of far more concern- is Ireland's aging population.
From 2030 onwards, our dependency ratio is going to go seriously skew-ways.

We cannot afford the state expenditure that we have persisted in doling out to the public, and even without any other factor (such as Brexit or Covid) in the mix, our ability to keep on going- was throttling rapidly in the wrong direction.

I have no idea whether there is going to be a property crash, or not, and if there is, by what extent different classes of properties will fall by.

We have a reckoning coming, regardless of what socialist/left leaning politicians would have you believe. We cannot continue, business as usual. How we decide to adapt to this changing world, will require gonads that the current political system seems incapable of delivering (and I'm not advocating in favour of any political doctrine- I think they're all as bad as one another).

Expenditure is going to have to be reviewed, as will taxation- and the silly things we did like agreeing to forego on the increase in the old age pension vestage age, are all going to bite us in the arse, irrespective of who is in power.

I don't like to point at specific measures and suggest that particular programmes will be cut or abolished, because, I don't know any better than anyone else. All I know is- fiscally- we are playing with fire, and we have a day of reckoning trundling towards us like a freight train, made all the worse by the demographic time bomb that people are ignoring like the elephant in the corner of the room.

PropQueries · 03-02-2021 02:40PM

Hubertj wrote: »

AmCham released information on Bidens buy American bill. Minimal impact on Ireland due to the nature of the good produced here.
Only an idiot would suggest MNCs haven’t already considered future tax development when making expansion or employment decisions in a country. Or maybe google and Microsoft don’t have a clue.

Maybe Google has already started moving jobs. Nobody knew when they created the c. 8,000 jobs and nobody will know when they start moving them.

We only hear the headlines when they create 200 jobs here and 200 jobs there. There was no headlines or politicians cutting ribbons when they started upping their workforce because they didn't know. Can work just as easily in reverse.

PropQueries · 03-02-2021 02:41PM

L1011 wrote: »

That's a proposed co-ownership scheme which is a vastly different product. I do hope you understand that.

So, the house buyer isn't on the hook for the c. €100k to the state under the proposed HTB scheme?

Good to know. Really.

L1011 · 03-02-2021 02:42PM

PropQueries wrote: »

So, the house buyer isn't on the hook for the c. €100k to the state under the proposed HTB scheme?

Good to know. Really.

It isn't a HTB scheme and you clearly don't understand it.

Graham · 03-02-2021 02:43PM

PropQueries wrote: »

We only hear the headlines when they create 200 jobs here and 200 jobs there. There was no headlines or politicians cutting ribbons when they started upping their workforce because they didn't know. Can work just as easily in reverse.

Apart from the collective redundancies legislation with mandatory employee information and consultation periods and notification to the Minister for Enterprise, Trade and Employment.

fliball123 · 03-02-2021 02:50PM

The_Conductor wrote: »

Perhaps its the 3.5times multiplier that the lenders apply that he has in mind.

Regardless- none of us have a crystal ball.

Ireland looks set to exit the Covid emergency with the second highest debt per capita in the world. The only thing keeping our heads above the water in the short to medium term- is statements from the ECB that they intend to keep interest rates extremely low for a protracted period of time.

Arguably- of far more concern- is Ireland's aging population.
From 2030 onwards, our dependency ratio is going to go seriously skew-ways.

We cannot afford the state expenditure that we have persisted in doling out to the public, and even without any other factor (such as Brexit or Covid) in the mix, our ability to keep on going- was throttling rapidly in the wrong direction.

I have no idea whether there is going to be a property crash, or not, and if there is, by what extent different classes of properties will fall by.

We have a reckoning coming, regardless of what socialist/left leaning politicians would have you believe. We cannot continue, business as usual. How we decide to adapt to this changing world, will require gonads that the current political system seems incapable of delivering (and I'm not advocating in favour of any political doctrine- I think they're all as bad as one another).

Expenditure is going to have to be reviewed, as will taxation- and the silly things we did like agreeing to forego on the increase in the old age pension vestage age, are all going to bite us in the arse, irrespective of who is in power.

I don't like to point at specific measures and suggest that particular programmes will be cut or abolished, because, I don't know any better than anyone else. All I know is- fiscally- we are playing with fire, and we have a day of reckoning trundling towards us like a freight train, made all the worse by the demographic time bomb that people are ignoring like the elephant in the corner of the room.

Have you link to 2nd highest debt per capita?? I cant find that info anywhere?

PropQueries · 03-02-2021 02:54PM

Graham wrote: »

Apart from the collective redundancies legislation with mandatory employee information and consultation periods and notification to the Minister for Enterprise, Trade and Employment.

It's not redundancy if they're still working for Google but in a different country.

awec · 03-02-2021 02:54PM

PropQueries wrote: »

So, the house buyer isn't on the hook for the c. €100k to the state under the proposed HTB scheme?

Good to know. Really.

They are on the hook.

PropQueries · 03-02-2021 02:57PM

fliball123 wrote: »

Have you link to 2nd highest debt per capita?? I cant find that info anywhere?

Well, back in 2018, we had the third highest public debt per capita in the developed world.

Link to RTE article here: https://www.rte.ie/news/business/2018/0903/991287-government-deficit/

Timing belt · 03-02-2021 02:57PM

PropQueries wrote: »

How will raising corporation taxes and CGT give the UK an "unfair advantage"?

They will have loop holes that you could drive a bus through as they always have.... It's not a coincidence that the UK wash all the Russian and Chinese money.

awec · 03-02-2021 02:58PM

PropQueries wrote: »

Maybe Google has already started moving jobs. Nobody knew when they created the c. 8,000 jobs and nobody will know when they start moving them.

We only hear the headlines when they create 200 jobs here and 200 jobs there. There was no headlines or politicians cutting ribbons when they started upping their workforce because they didn't know. Can work just as easily in reverse.

Or maybe they haven't.

All we can go on is the facts as they are known. MNCs continue to invest in Ireland, despite your continual insistence that this won't happen.

hometruths · 03-02-2021 03:05PM

The_Conductor wrote: »

I don't like to point at specific measures and suggest that particular programmes will be cut or abolished, because, I don't know any better than anyone else. All I know is- fiscally- we are playing with fire, and we have a day of reckoning trundling towards us like a freight train, made all the worse by the demographic time bomb that people are ignoring like the elephant in the corner of the room.

Hear, hear.

hometruths · 03-02-2021 03:07PM

Mic 1972 wrote: »

My understanding is that the market has slowed down due to Covid, not due to lack of demand. Are we saying that there is no demand?

Market slowed down significantly due to weakening demand before Covid.

If anything Covid has revved it up again, rather than slowed it down.

fliball123 · 03-02-2021 03:10PM

schmittel wrote: »

Market slowed down significantly due to weakening demand before Covid.

If anything Covid has revved it up again, rather than slowed it down.

Have you any proof of this, could of slowed down due to Brexit, could of revved back up due to lack of supply. If you have proof to what your saying can you show it?

awec · 03-02-2021 03:12PM

fliball123 wrote: »

Have you any proof of this, could of slowed down due to Brexit, could of revved back up due to lack of supply. If you have proof to what your saying can you show it?

There is no way to prove it either way, that's not really a fair question to ask.

Unlike supply, demand is hard to quantify.

fliball123 · 03-02-2021 03:16PM

awec wrote: »

There is no way to prove it either way, that's not really a fair question to ask.

Unlike supply, demand is hard to quantify.

Then the poster should be saying in his opinion instead of it coming across as fact as he cant prove it. Too many guys who want property to drop are using their own wants as fact and we need to start pulling people up on it. If I put something up here I will try my hardest to quantify it by fact. If its something I am just thinking than I will add an IMO

hometruths · 03-02-2021 03:17PM

fliball123 wrote: »

Have you any proof of this, could of slowed down due to Brexit, could of revved back up due to lack of supply. If you have proof to what your saying can you show it?

Eh?

Are you asking do I have proof of whether the market slowed down? A slow down in market is weakening demand.

But then you yourself suggest it could have slowed down due to Brexit?

You're not making any sense.

Timing belt · 03-02-2021 03:20PM

The_Conductor wrote: »

Perhaps its the 3.5times multiplier that the lenders apply that he has in mind.

Regardless- none of us have a crystal ball.

Ireland looks set to exit the Covid emergency with the second highest debt per capita in the world. The only thing keeping our heads above the water in the short to medium term- is statements from the ECB that they intend to keep interest rates extremely low for a protracted period of time.

Arguably- of far more concern- is Ireland's aging population.
From 2030 onwards, our dependency ratio is going to go seriously skew-ways.

We cannot afford the state expenditure that we have persisted in doling out to the public, and even without any other factor (such as Brexit or Covid) in the mix, our ability to keep on going- was throttling rapidly in the wrong direction.

I have no idea whether there is going to be a property crash, or not, and if there is, by what extent different classes of properties will fall by.

We have a reckoning coming, regardless of what socialist/left leaning politicians would have you believe. We cannot continue, business as usual. How we decide to adapt to this changing world, will require gonads that the current political system seems incapable of delivering (and I'm not advocating in favour of any political doctrine- I think they're all as bad as one another).

Expenditure is going to have to be reviewed, as will taxation- and the silly things we did like agreeing to forego on the increase in the old age pension vestage age, are all going to bite us in the arse, irrespective of who is in power.

I don't like to point at specific measures and suggest that particular programmes will be cut or abolished, because, I don't know any better than anyone else. All I know is- fiscally- we are playing with fire, and we have a day of reckoning trundling towards us like a freight train, made all the worse by the demographic time bomb that people are ignoring like the elephant in the corner of the room.

Everyone goes on about Irelands debt levels despite the fact that we have one of the lowest yields in Europe due to the management of our debt. A credit default swap (CDS) for Ireland will cost you less than one for France. Add on top of this We have one of the youngest demographics in Europe. All these issues are present in most EU states and everyone is happy to kick the can down the road and hope that we see inflation sometime soon.

The reality is that the system is broken at its core and QE is not resolving the issues like they hoped due to liquidity getting trapped in the banks because they are not lending. I would be a lot more concerned about what is coming down the road in the short to medium term as an awful lot of wealth will be destroyed but in the meantime house prices will rise with investors chasing yield.

2021 Irish Property Market chat - *mod warnings post 1*

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2021 Irish Property Market chat - mod warnings post 1