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

PropQueries wrote: »

They really laid into that poor ESRI employee today:

“ESRI officer defends comments on housing scheme amid Government pushback”

“Independent Senator Victor Boyhan welcomed the institute’s input. “I don’t believe you set out to upset people but I do believe you have given us a dose of reality,” he said.”

Talk about blaming the messenger. They must be really worried the whole housing market is built on sand to be this angry about what should basically be just another insignificant report IMO

Link to Irish Times article here: https://www.irishtimes.com/news/politics/esri-officer-defends-comments-on-housing-scheme-amid-government-pushback-1.4486703

It further highlights why any discrepancies in figures needs to be queried.

Imagine a scheme written by a group of lobbyists tied to the property sector then when the independent people we trust are asked their view on it TDs don’t want to hear it, banana republic stuff

poker--addict wrote: »

In all 3 examples gov will provide greater assistance for apartments, and the upper limit for apartments is higher than homes. Why?

I am sad to read we are promoting 485,000 euro apartments. Our policy makers are obsessed with apartments. I wonder how many of them have raised a child in the shoebox size apartments we endorse in Ireland?

These equity schemes should get families into family homes. If we want more families to be raised in apartments then change regs to insist on larger units, we are doing the opposite.

In theory, we do need lots of apartments, because single people, particularly men, are overrepresented in homelessness figures, and removing the rent incentive to wedge 9 people into a three bed would go a long way.

But the government consistently develops schemes that serve only to raise the cost of housing, and units in that kind of price range are useless except as safe deposit boxes. Mid range 1 and 2 bed apartments are exactly what need rn and they're like gold dust.

combat14 wrote: »

varadker states pay cuts and tax rises on the way albeit delayed for another little while .. reassuring for those buying a house and worth factoring in when getting a mortgage the next while .. last time the pay cuts to public servants and tax rises were brutal & swingeing - who knows what they will be like this time with govt debt absolutely soaring at present


There will be no cuts to public sector pay or increase in income tax for “at least for the first couple of years” after the pandemic, Tánaiste Leo Varadkar has said.

https://m.independent.ie/news/tanaiste-commits-to-no-post-pandemic-tax-hikes-or-cuts-to-public-sector-pay-40100605.html

How would you suggest debt is repaid? Of course taxes will increase. I think we will see an increase in property taxes and other measures to broaden the tax base. Such increases will be done over a longer period of time.
Public servants are in a very privileged position.

combat14 wrote: »

varadker states pay cuts and tax rises on the way albeit delayed for another little while .. reassuring for those buying a house and worth factoring in when getting a mortgage the next while .. last time the pay cuts to public servants and tax rises were brutal & swingeing - who knows what they will be like this time with govt debt absolutely soaring at present


There will be no cuts to public sector pay or increase in income tax for “at least for the first couple of years” after the pandemic, Tánaiste Leo Varadkar has said.

https://m.independent.ie/news/tanaiste-commits-to-no-post-pandemic-tax-hikes-or-cuts-to-public-sector-pay-40100605.html

So in two years time we will start paying back our debt and pay the salaries for the additional 70,000 public sector workers they intend to hire over the 19 month period starting March 2020.

And they're going to do all this without increasing taxes or cutting public sector pay? To me, that only really leaves pensions and property that's left to be taxed at that stage and in the meantime IMO

Link to Irish Times article on Michael McGrath hiring 70,000 additional public sector workers over the 19 month period starting March 2020: https://www.irishtimes.com/news/politics/number-of-public-servants-to-rise-to-370-000-over-next-19-months-1.4482201

hmmm wrote: »

Yeah, we need lots more apartments and density in general. There is this obsession with "housing for families" when there are vast numbers of single people and couples who also need somewhere to live and don't want to live in a semi-d with a big commute. The demographics are suggesting that we will have a lot more 2 person households in the future, I think McWilliams keeps going on about this. Not every housing unit has to have room for kids, a garden and a pony.

I think they definitely should build apartments in the city but I think the issue is that given the rents they intend to charge, two incomes will be required to pay the proposed rents i.e. a couple/family? So, they're not aimed at single people IMO

And, if we're honest, the primary reason people have less children these days is primarily due to the cost of housing, so it's kind of a self fullfilling prophesy?

PropQueries wrote:

Talk about blaming the messenger. They must be really worried the whole housing market is built on sand to be this angry about what should basically be just another insignificant report IMO

The comments by the FF senator are eye opening
53% of rents subsidised by the state.
Many of the remaining unsubsidised renters are under severe pressure and cant afford a mortgage.
Add
Every new housing unit is subsidised by the state through ftb grant or tax breaks for investment funds

And the solution she is selling is subprime lending supported by the state on adjustable rates to people who the banks have decided are too risky in an environment of 0% interest rates.

The state is the largest landowner in the country has access to free money and the pool of labour required to build is increasing.

This can be fixed easily and be revenue positive for the state instead they are pursuing policy after policy that drives prices and rents up, costs the taxpayer a fortune, and makes the problem worse

In addition the markets are predicting inflation which makes tackling supply an even greater no brainer and income generator for the state

Villa05 wrote: »

The comments by the FF senator are eye opening
53% of rents subsidised by the state.
Many of the remaining unsubsidised renters are under severe pressure and cant afford a mortgage.
Add
Every new housing unit is subsidised by the state through ftb grant or tax breaks for investment funds

And the solution she is selling is subprime lending supported by the state on adjustable rates to people who the banks have decided are too risky in an environment of 0% interest rates.

The state is the largest landowner in the country has access to free money and the pool of labour required to build is increasing.

This can be fixed easily and be revenue positive for the state instead they are pursuing policy after policy that drives prices and rents up, costs the taxpayer a fortune, and makes the problem worse

In addition the markets are predicting inflation which makes tackling supply an even greater no brainer and income generator for the state

I was stunned with the 53% figure when I read it myself. Pretty sure the ESRI mean it in the context of 53% of people who are classified as renting are supported by the state (which would include LA housing and make a lot more sense!). I don't think they are saying 53% of participants in the private rental sector are receiving state support although with HAP this will continue to rise

PropQueries wrote: »

So in two years time we will start paying back our debt and pay the salaries for the additional 70,000 public sector workers they intend to hire over the 19 month period starting March 2020.

And they're going to do all this without increasing taxes or cutting public sector pay? To me, that only really leaves pensions and property that's left to be taxed at that stage and in the meantime IMO

Link to Irish Times article on Michael McGrath hiring 70,000 additional public sector workers over the 19 month period starting March 2020: https://www.irishtimes.com/news/politics/number-of-public-servants-to-rise-to-370-000-over-next-19-months-1.4482201

OK lets just cut this out..Not just you Props. Before covid we had turned a corner with our deficit we have been paying back debt since the 2008 crash. The problem had been our deficit over those years. We had actually managed to recover and in 2018 and 2019 we were taking in more money than spending even when servicing a 200Billion debt. Now Corona has kicked in 2020 and 2021 we will be borrowing another 30 billion for this but the existing 200billion was refinanced at a almost 0% rate along with the new 30Billion so we are not paying out much more on interest and we still do not know what way the deficit will be after the country opens back up. One thing the world has learned is that austerity does not work. lets see how their approach works this time.

Also remember there had been an embargo on public sector jobs for years after 2008 which put a lot of pressure on some public sector areas. The garda are one such area, same goes with school teachers. Props you still have not joined the dots that our population has increased year on year for the last 100 years and as such the public sector has to grow to accommodate this as well. Cant believe I am actually defending the public sector. I do agree with you on what it costs for a public sector worker in this country and what should be done is public sector should stop paying the pension levy and be told to pay for their own pension just like the unwashed masses in the private sector.

PropQueries wrote: »

Whether we require more public sector workers or not (I think not) is a mute point in my mind.

How we intend to pay for them without increasing income taxes or pay/pension cuts is vastly more important to me.

And, I'm still of the opinion that our eastern european EU neighbours, who have much lower real debt and pay/pension levels than we do, aren't going to keep allowing the ECB to keep funding our extravagances forever and a day IMO

Otherwise, it's just the ECB printing money and handing it over to some of the western EU countries for free.

Weather you agree or disagree about ps workers. The 3 points below can be proven so instead of you licking your finger and sticking it in the air to see which way the wind is blowing, just try and get your head around these 3 points.

1) We had an employment embargo for years after 2008 - so no new hires

2) We had an active campaign of people taking redundancies or retirement in the PS in those years as well - Having said that none of it was forced and the PS were treated with kid gloves during the last recession- so losing staff

So numbers wise in the ps we had 325117 back in 2008 this dropped to 291838 in 2013 and back to 330576 in 2018 so in effect we have had an increase of about 5k ps workers in that time

https://publicpolicy.ie/papers/public-service-numbers-and-pay-from-austerity-to-recovery/

3) We have had an increase in our population of 567,035 since 2008

So we have hired 1 ps worker for every 100 people added to our population over that period. Not sure how this tallies with the rest of the globe with numbers.


So as much as I dislike the attitude and the entitlement culture in our PS along with the ridiculously high pay, pensions and perks we have a need for more resources. This is a fact not an IMO

I reckon the idea will be to get the economy going again, get people working again, employment is the driver for all taxation with the exception of corpo tax people have to work to pay it. The ECB is funding every country at the moment do you not think other countries even your beloved eastern euro countries are having problems during covid and need financial support

Analysis: How Sinn Féin will seek to undermine LDA launch with its own unofficial website

‘Non-partisan’ site will be modelled on Nama Wine Lake project which gained a considerable following and led to questions in the Dáil

The new Land Development Agency (LDA) is supposed to deliver up to 20,000 homes on public land in the decades ahead. The bill to set it up is arriving in the Dáil for the first time today.

But Sinn Féin is launching its own LDA website to thwart this key policy priority for Darragh O’Brien, the Minister for Housing.

It is an interesting venture from Sinn Féin because its unofficial LDA website will be presented as a “non-partisan” destination for all information for LDA housing projects around the country.

It is modelled on the now mothballed Nama Wine Lake website which was founded by an anonymous person during the last recession to question the actions of the National Asset Management Agency. It gained a considerable following and some of the information published there led to questions in the Dáil and responses from Nama. The author of the site signed off in 2013, having managed to keep his or her identity a secret.

https://www.businesspost.ie/ireland/analysis-how-sinn-fein-will-seek-to-undermine-lda-launch-with-its-own-unofficial-website-134570c9?auth=login

It seems O Brien's bill has been heavily watered down compared to the one Eoghan Murphy proposed(FG), mostly the LDA is not going to be the super quango handing public land over to developers that Fine Gael wanted

PropQueries wrote: »

In the very short term it may increase the price of new builds (or maybe just stop developers reducing their prices?).

Then in 5 years time, just when the buyers have to start making repayments on the government “subsidy/help/loan”, the state will finally admit we have a pension/healthcare budget problem and jack up PRSI to 20%-30% (still not an income tax increase in their eyes).

That will then bring real income taxes up to c. 70% at the higher rate (threshold probably dropped to €20k by that stage) on top of the additional mortgage payments these people will be forced to pay IMO

Then why didnt they do that after 2008? 20/30 on PRSI dont think so and 70% at the higher rate the law of diminishing returns is currently kicking in at the rate currently 70% will result in less taxes being collected.

PropQueries wrote: »

In the very short term it may increase the price of new builds (or maybe just stop developers reducing their prices?).

Then in 5 years time, just when the buyers have to start making repayments on the government “subsidy/help/loan”, the state will finally admit we have a pension/healthcare budget problem and jack up PRSI to 20%-30% (still not an income tax increase in their eyes).

That will then bring real income taxes up to c. 70% at the higher rate (threshold probably dropped to €20k by that stage) on top of the additional mortgage payments these people will be forced to pay IMO

If real income taxes are 70% and you are paying 23% VAT, the tax burden would be 93% of income earned.

Thankfully, I don't believe that to be feasible.