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

Bass Reeves wrote:

The problem with bearish opinions is that in general there suppositions are based on factors that may influence house pric s in 2+years time. None of there so called facts will effect house prices in six weeks, six months and may not effect houses prices in six years time. That is the problem with many bearish opinions at present.

Most new property being purchased by:

Govt for social/affordable.

Investment funds, reits supported by close to 0 tax policy from Govt and long term leases at peak rents from the state

The remaining sales are supported by Ftb grants of up to 30k rising to 130k with shared ownership driving up prices

It would appear that prices of all new builds are propped up/inflated by the state

The state is amongst the most indebted in the world with a multitude of high cost issues awaiting it


How long will the current situation last?

You can only get away with bad policies for so long. The lobger they survive the greater the pain when we are found out

schmittel wrote: »

I don't need to go back over the the threads, as I have read them all. And I have seen as much spinning of data from posters on the other side of Props arguments as I have from Props. There are no conspiracy theories.



You were right in your predictions about the market twelve months ago. I was wrong. I am happy to say it as many times as you wish. It is not a big deal for me.

In any discussion forum, having people with differing opinions is healthy. In a forum like this where people are discussing what will happen in the future, it is inevitable that some of those opinions will turn out to be wrong.

I have no problem with my opinions being wrong when evidence or events confirm it. I do have a problem with posters who cannot admit that they are wrong. That does not make for valuable debate, and posters just end up making fools of themselves.

Hey! Don't give in to other posters so easily. If our CSO/PPR stats are as out of whack as the UK equivalent statistics, you may be proven right yet

As someone who's too young to remember the previous property crash, I was intrigued to see what the commentary was like approaching and during that time. It made me smile to see how the same old tropes of "extra cash" (SSIA vs Pandemic Savings) and lack of supply in the right areas seem to be exactly the same.

I'm not for a second suggesting the fundamentals we face today remotely resemble those of 2007, nor do I believe personally that there's any major drop in price coming. It has just made me more resolute in my belief that nobody, not even the "experts", really have any clue what's coming down the tracks!

Quotes from Daft Property experts in reports from 06/07 just as Ireland barreled towards a 50%+ reduction across the board. These are ordered from oldest to most recent to show the very slight change in mood over time.

"economic forecasts suggest that employment and incomes will continue to grow. This year also sees SSIAs starting to mature. Surveys indicate that a sizeable portion of SSIA money will find its way into the property market. Overall economic growth is expected to remain strong at over 5 per cent per annum in both 2006 and 2007. Thus, the Irish housing market should continue to be driven by strong activity levels"

"Two fundamental events justify the reacceleration in prices since this time last year. As last year drew to a close, the expected release of SSIA moneys, which began this May, became bankable as deposit leverage....So the recent price resurgence is 'fundamental' in nature: The stock of credit available for house purchase increased significantly in a short space of time, but the supply of houses in sought after areas did not. Throw more money after the same amount of goods and prices rise: It's the oldest law in economics."

"But the underlying market realities do not point to a collapse in prices either in 2007 or beyond."

"The latest Daft.ie figures show that vendors have revised their expectations for prices, as a result of weaker demand from potential buyers. But the data also continue to suggest that the most likely outcome for prices is a period of stagnation rather than significant decline."

"Selling prices are unlikely to decline sharply here for a number of reasons. First, Irish builders have cut supply immediately and radically. Second, the majority of new home developers are cash-rich after years of high retained earnings. They can afford to sit and wait for sales to materialize without having to drop prices significantly. Third, existing home-owners wishing to trade-up invariably take their homes off the market rather than sell at a discount. In some cases, they may prefer to extend or renovate their homes rather than settle for a lower price. Our guess is that prices will be unchanged to slightly down over the next six months."

PropQueries wrote: »

Well, in my case, I only joined on the 27th July 2020, so I'm only posting here for about 6 months. Hardly enough time for my predictions to be proved wrong yet IMO

sorry feels like longer,

you have been proven wrong on plenty

PropQueries wrote: »

Edit - Replied to this post by mistake even though it wasn't aimed at me Below is my post on the current published CSO/PPR possible data issues.

Well, according to the BPFI last week:

“The number of mortgages approved last year was the lowest since 2017, despite a pick-up in activity in the final quarter of the year, according to figures from Banking & Payments Federation Ireland (BPFI).

During 2020, 43,151 mortgages worth €10.3 billion were approved. The value of these mortgages was down 6.7% compared with 2019.

The BPFI’s figures also showed that 35,617 mortgages worth almost €8.4 billion were drawn down in 2020, also the lowest figure since 2017. This was despite a 50% jump in volume compared with the third quarter of 2020.”

So demand was definitely down over 2020.

And it’s definitely not a “supply” issue for two reasons.

1. New build supply didn’t fall off a cliff during 2020.

2. None of the data predicted this “supply” issue in the months before Covid. With net inward migration etc. down, it’s most likely other short-term issues (e.g. maybe more higher income groups as a percentage of home buyers buying property, hence skewing the data or delays in processing the data due to lockdowns etc.) in relation to the published PPR/CSO data IMO

A good example is the recent issue in the UK where the ONS (their version of our CSO) reported an increase in the population in London, while another government backed organisation stated the population actually probably fell by 700,000.

The ONS stated in response:

“The ONS does not dispute the logic of the analysis and accepts anomalies being in its current estimates of employment and population. It blames these on difficulties of counting migration during the pandemic when its normal surveys have been suspended.”

Link to BPFI article here: https://www.lawsociety.ie/gazette/top-stories/mortgage-approvals-at-lowest-level-since-2017/

Link to ONS article here: https://www.irishtimes.com/news/world/uk/covid-19-london-s-population-fell-by-700-000-amid-exodus-of-foreign-born-residents-from-uk-1.4458762

And just like he heard the call ..here we go

bringing in comparisons with London population - Why? what has London's population got to do with it? Not a mention that Brexit may have something to do with this, but because the ONS got it wrong so is the CSO ??

Completely ignoring the fact that even without immigration inwards our population still naturally increased.

Ireland seen an increase of 55900 in the year from April 2019 to April 2020 according to the CSO

https://www.cso.ie/en/csolatestnews/pressreleases/2020pressreleases/pressstatementpopulationandmigrationestimatesapril2020/

But no will look at London and because they seen a drop in population we must of seen one here as well.


Completely ignoring the increased difficulty covid, lockdown, PUP or the subsidy payments had on people drawing down mortgages and increasing the time it has taken to get approval and to see out the actual purchase of a property. There is a thread on here about people currently buying and selling this is all anacodal of course but just have a look at some of the struggles people have had over the past year

https://www.boards.ie/vbulletin/showthread.php?t=2058047890

Links to some difficulties for drawing down (just 2 of many)
https://www.irishexaminer.com/news/arid-31000912.html

https://www.thejournal.ie/wage-subsidy-mortgage-approval-5120028-Jun2020/


Picking a specific date range the year as a comparison that suits his narrative. If we compared Q4 in 2019 and 2020 what way would the stats go and ignoring the fact that in Q4 we hit an all time high for mortgage approval rates since they were recorded.

https://www.rte.ie/news/business/2020/1222/1185914-mortgage-approval-rates/

We still have no figures on the actual amount of new properties built in 2020 they are all still estimates. The figure will be out soon. Can he show me a link to where it says actual figures as anything posted on here or that are up on line are estimates from 2020.

Ignoring the fact that there is a supply issue. When people say there is a supply issue he will then give a 2016 stat about the amount of vacant houses that are out there is at 90k . He believes no houses have ever been abolished in that time, or that some of the people were not just simple out of the house at the time the survey was done and the 90k houses will in the near future be there ready for sale or rent

You only have to look at my home Jan of last year there were 25k properties for sale. Feb this year less than 12k If there are less than half the amount of properties available in 12 months can you not say supply has fallen off a cliff?? I guess its up to everyone else to make up their own mind. But its ok as the 90k empty properties that were supposedly there in 2016 will soon be coming on stream. Not to mention all the properties that deaths will free up even do births have out paced deaths each and every every year and up until Q2 in 2020 and all of these people need a place to live. We have no stats after this

https://www.cso.ie/en/releasesandpublications/ep/p-vs/vitalstatisticssecondquarter2020/#:~:text=This%20equates%20to%20a%20death,2.7%20per%201%2C000%20live%20births.

So how many conspiracy theories can we take from this Schmittel??

NO:1
London's population and fact finding are wrong therefore we can assume so is the CSO and Ireland population has gone down.

NO:2
Because we had a year where we had mortgage drawdowns under the level of 2017 a year just plucked out of his bum demand was definitely down and ignoring the mortgage approval rates or the difficulties that are there in drawing down.

NO:3 in their own words - There is definitely not a supply issue - this one need a tinfoil hat

fliball123 wrote: »

And just like he heard the call ..here we go

bringing in comparisons with London population - Why? what has London's population got to do with it? Not a mention that Brexit may have something to do with this, but because the ONS got it wrong so is the CSO ??

Completely ignoring the fact that even without immigration inwards our population still naturally increased.

Ireland seen an increase of 55900 in the year from April 2019 to April 2020 according to the CSO

https://www.cso.ie/en/csolatestnews/pressreleases/2020pressreleases/pressstatementpopulationandmigrationestimatesapril2020/

But no will look at London and because they seen a drop in population we must of seen one here as well.


Completely ignoring the increased difficulty covid, lockdown, PUP or the subsidy payments had on people drawing down mortgages and increasing the time it has taken to get approval and to see out the actual purchase of a property. There is a thread on here about people currently buying and selling this is all anacodal of course but just have a look at some of the struggles people have had over the past year

https://www.boards.ie/vbulletin/showthread.php?t=2058047890

Links to some difficulties for drawing down (just 2 of many)
https://www.irishexaminer.com/news/arid-31000912.html

https://www.thejournal.ie/wage-subsidy-mortgage-approval-5120028-Jun2020/


Picking a specific date range the year as a comparison that suits his narrative. If we compared Q4 in 2019 and 2020 what way would the stats go and ignoring the fact that in Q4 we hit an all time high for mortgage approval rates since they were recorded.

https://www.rte.ie/news/business/2020/1222/1185914-mortgage-approval-rates/

We still have no figures on the actual amount of new properties built in 2020 they are all still estimates. The figure will be out soon. Can he show me a link to where it says actual figures as anything posted on here or that are up on line are estimates from 2020.

Ignoring the fact that there is a supply issue. When people say there is a supply issue he will then give a 2016 stat about the amount of vacant houses that are out there is at 90k . He believes no houses have ever been abolished in that time, or that some of the people were not just simple out of the house at the time the survey was done and the 90k houses will in the near future be there ready for sale or rent

You only have to look at my home Jan of last year there were 25k properties for sale. Feb this year less than 12k If there are less than half the amount of properties available in 12 months can you not say supply has fallen off a cliff?? I guess its up to everyone else to make up their own mind. But its ok as the 90k empty properties that were supposedly there in 2016 will soon be coming on stream. Not to mention all the properties that deaths will free up even do births have out paced deaths each and every every year and up until Q2 in 2020 and all of these people need a place to live. We have no stats after this

https://www.cso.ie/en/releasesandpublications/ep/p-vs/vitalstatisticssecondquarter2020/#:~:text=This%20equates%20to%20a%20death,2.7%20per%201%2C000%20live%20births.

So how many conspiracy theories can we take from this Schmittel??

NO:1
London's population and fact finding are wrong therefore we can assume so is the CSO and Ireland population has gone down.

NO:2
Because we had a year where we had mortgage drawdowns under the level of 2017 a year just plucked out of his bum demand was definitely down and ignoring the mortgage approval rates or the difficulties that are there in drawing down.

NO:3 in their own words - There is definitely not a supply issue - this one need a tinfoil hat

From the same CSO link you posted in relation to the population increase:

"In April 2020, 720,100 persons were estimated to be aged 65 years and over, reflecting an increase of 90,200 persons (+14.3%), in this age group since April 2016"

How many of these over 65's are in the market for a new house?

DataDude wrote: »

As someone who's too young to remember the previous property crash, I was intrigued to see what the commentary was like approaching and during that time. It made me smile to see how the same old tropes of "extra cash" (SSIA vs Pandemic Savings) and lack of supply in the right areas seem to be exactly the same.

I'm not for a second suggesting the fundamentals we face today remotely resemble those of 2007, nor do I believe personally that there's any major drop in price coming. It has just made me more resolute in my belief that nobody, not even the "experts", really have any clue what's coming down the tracks!

Quotes from Daft Property experts in reports from 06/07 just as Ireland barreled towards a 50%+ reduction across the board. These are ordered from oldest to most recent to show the very slight change in mood over time.

"economic forecasts suggest that employment and incomes will continue to grow. This year also sees SSIAs starting to mature. Surveys indicate that a sizeable portion of SSIA money will find its way into the property market. Overall economic growth is expected to remain strong at over 5 per cent per annum in both 2006 and 2007. Thus, the Irish housing market should continue to be driven by strong activity levels"

"Two fundamental events justify the reacceleration in prices since this time last year. As last year drew to a close, the expected release of SSIA moneys, which began this May, became bankable as deposit leverage....So the recent price resurgence is 'fundamental' in nature: The stock of credit available for house purchase increased significantly in a short space of time, but the supply of houses in sought after areas did not. Throw more money after the same amount of goods and prices rise: It's the oldest law in economics."

"But the underlying market realities do not point to a collapse in prices either in 2007 or beyond."

"The latest Daft.ie figures show that vendors have revised their expectations for prices, as a result of weaker demand from potential buyers. But the data also continue to suggest that the most likely outcome for prices is a period of stagnation rather than significant decline."

"Selling prices are unlikely to decline sharply here for a number of reasons. First, Irish builders have cut supply immediately and radically. Second, the majority of new home developers are cash-rich after years of high retained earnings. They can afford to sit and wait for sales to materialize without having to drop prices significantly. Third, existing home-owners wishing to trade-up invariably take their homes off the market rather than sell at a discount. In some cases, they may prefer to extend or renovate their homes rather than settle for a lower price. Our guess is that prices will be unchanged to slightly down over the next six months."

Sure just look at all the threads from years after the crash saying buying is for idiots, you should rent for the rest of your life and you will come out better off. All backed up, as is every prediction with links and stats from all sorts of studiess and reports.
You are right. Nobody actually does know at the end of the day.

PropQueries wrote: »

Well, in my case, I only joined on the 27th July 2020, so I'm only posting here for about 6 months. Hardly enough time for my predictions to be proved wrong yet IMO

You've been here before.
I recognize your style

JimmyVik wrote: »

You've been here before.
I recognize your style

100% untrue as, yes, I do have a style, and it would have been spotted

But either way, here for the debate so not too worried on peoples viewpoints on that front.

DataDude wrote: »

As someone who's too young to remember the previous property crash, I was intrigued to see what the commentary was like approaching and during that time. It made me smile to see how the same old tropes of "extra cash" (SSIA vs Pandemic Savings) and lack of supply in the right areas seem to be exactly the same.

I'm not for a second suggesting the fundamentals we face today remotely resemble those of 2007, nor do I believe personally that there's any major drop in price coming. It has just made me more resolute in my belief that nobody, not even the "experts", really have any clue what's coming down the tracks!

Quotes from Daft Property experts in reports from 06/07 just as Ireland barreled towards a 50%+ reduction across the board. These are ordered from oldest to most recent to show the very slight change in mood over time.

"economic forecasts suggest that employment and incomes will continue to grow. This year also sees SSIAs starting to mature. Surveys indicate that a sizeable portion of SSIA money will find its way into the property market. Overall economic growth is expected to remain strong at over 5 per cent per annum in both 2006 and 2007. Thus, the Irish housing market should continue to be driven by strong activity levels"

"Two fundamental events justify the reacceleration in prices since this time last year. As last year drew to a close, the expected release of SSIA moneys, which began this May, became bankable as deposit leverage....So the recent price resurgence is 'fundamental' in nature: The stock of credit available for house purchase increased significantly in a short space of time, but the supply of houses in sought after areas did not. Throw more money after the same amount of goods and prices rise: It's the oldest law in economics."

"But the underlying market realities do not point to a collapse in prices either in 2007 or beyond."

"The latest Daft.ie figures show that vendors have revised their expectations for prices, as a result of weaker demand from potential buyers. But the data also continue to suggest that the most likely outcome for prices is a period of stagnation rather than significant decline."

"Selling prices are unlikely to decline sharply here for a number of reasons. First, Irish builders have cut supply immediately and radically. Second, the majority of new home developers are cash-rich after years of high retained earnings. They can afford to sit and wait for sales to materialize without having to drop prices significantly. Third, existing home-owners wishing to trade-up invariably take their homes off the market rather than sell at a discount. In some cases, they may prefer to extend or renovate their homes rather than settle for a lower price. Our guess is that prices will be unchanged to slightly down over the next six months."

Data yes you are correct. However the fundamental s were different and the assumptions made by estate agents was against a lot of other opinions out there at the time.

SSIA's were done mainly by savers. Myself and my wife had one each and only that many as our kids were not eighteen. I knew a lad that opened 4-5 putting the minimum amount in 2-3 of the ones he opened. We maxed out ours as we only had two. The estate agents assumptions was based on a biased assumption. Our toiseach virtually told people who foresaw the collapse to go away and commit suscide. There was a lot of time economists that predicted the collapse.

But there was other fudmentals. We were building 40k houses a year, banks were funding development to be complete before a housev as build. There was 100 k houses completed and in various stages of completion as the crash happened. Even with all that it was 2010-2012 where the majority of the price fall happened. Builders sat on supply that long and banks financed them.

We had a huge public finances issues as we we had increased public spending and services substantially. This was funded mainly by stamp duty and property transactions as well as vat and income taxes from the property sector. You could equate pandemic borrowings to this but this borrowings should reduce as we vaccinate population.

Banks just didn't lend to the Irish sectors. They were financing property speculation accross Europe. You were nobody unless you had 2-3 houses. Tommy the taxi drive his house in Dublin, had bought one in Wexford and was buying one in Fuengeirola.

well looks like I got my new dwellings completions estimates wrong it looks like there was a huge increase in completions in Q4 in 2020 data just out now. Thats some going considering the lockdown in Q4 as well

https://www.cso.ie/en/releasesandpublications/er/ndc/newdwellingcompletionsq42020/

schmittel wrote: »

And PropQueries was right?

I've just taken my tin-foil hat off and placed it into storage... for the time being

PropQueries wrote: »

I've just taken my tin-foil hat off and placed it into storage... for the time being

stopped clock is right twice a day so with you being right here do you still think we have no supply issue?

PropQueries wrote: »

Have I ever deviated from that viewpoint?

In fairness no you haven't even with all the evidence that there is one