PropQueries wrote: » But I don’t think the institutional investors are interested in buying that one three bed semi that comes up for sale in the middle of an estate in e.g. Stillorgan. The problem now is that there’s a good chance the state is now directly competing with that family looking to buy that three bed in Stillorgan IMO
schmittel wrote: » Yes and that 3 bed in Stillorgan has a value directly linked to its rental yield. If the state is setting a floor for rental values they are driving the price of that property up whether they are bidding on it or not.
Cyrus wrote: » Are 3 bed semis in desirable suburbs valued at rental yield given the majority are bought by families to live in ? I’d argue the desirability of the location is the determining factor.
schmittel wrote: » I don't think Prop's is saying (I'm sure he'll correct me if I am wrong) is that the state is bidding on every property, outbidding each and every buyer. That's ridiculous. But in the market as a whole, where prices are set at the margin, the state is the marginal buyer, which you appear to agree with: If investors are piling in for yield because the state is to all intents and purposes setting a floor for rents, then the state is essentially setting the price at the margin. The Redrock deal I posted yesterday is a perfect example. If the state is driving prices upwards by their activity in the market, then Props is bang on the money. Once again.
schmittel wrote: » Yes, the rental yield is very relevant.
Hubertj wrote: » I thought prices have been pretty much flat or decreased sloughtly since end of 2018? We did see some increase in prices 2nd half of last year but was that not due to reduced supply and “pent up demand”?
Cyrus wrote: » If I am buying a house to live in the theoretical rental yield isn’t a factor in my decision making process, is it in a location that I want to live, does it have desirable amenities, does it meet my space requirements and can I afford it are what matters.
schmittel wrote: » Sure, but just because you're not planning on renting it out and thus don't consider the rental yield relevant, it's still a factor in the market price that you end up paying for the things that are important to you.
PropQueries wrote: » I would think it’s definitely a factor in “desirable” locations. Many desirable locations have relatively older populations and when the time comes for the children / grandchildren to decide whether to rent or sell their inherited property, the expected rental income would definitely be a factor in their decision to either sell or keep it IMO
PropQueries wrote: » Interesting article in the Irish Times: “LDA chief executive John Coleman believes he can improve on local authorities’ six-year process and bring a raw piece of land to the stage of having housing on it in four years.” It’s a subscriber article but you can get the gist from the first paragraph. But it does draw up comparisons with Charlie Haughey and how he got the Beaumont Hospital built: “Haughey established the Beaumont Hospital Board in 1977, to build and equip an acute general hospital in his constituency. Rather than engage more architects to design a new hospital, which would involve a considerable amount of time and expense, Mr. Haughey decided to utilise the existing plans used for the construction of the Cork University Hospital (Wilton) in the early 70's. This inspired decision ensured that the hospital was built without any undue delay at a cost of €52.7 million.” He basically said that they already built a hospital in Cork, just take those plans and build it in Beaumont. A field is a field whether it’s in Cork, Mayo or Dublin. It’s not brain surgery. It just show that with the right person in charge, the housing issue could be resolved quickly and relatively cheaply IMO Link to Irish Times article here: https://www.irishtimes.com/news/social-affairs/affordable-housing-can-land-development-agency-succeed-where-others-have-failed-1.4502279 Link to Beaumont Hospital and Charlie Haughey article here: https://www.charlesjhaughey.ie/articles/beaumont-hospital
Timing belt wrote: » There were a lot of houses built in Cork thanks to the building of CUH back then and it wasn't from the extra employment more the raw materials that went missing....
PropQueries wrote: » Well, unless the EU, ECB or the bond market puts some manners on the states current spending spree, there will be very few “desirable” locations left in Dublin IMO Just ask the residents of Ailesbury Road in Ballsbridge (second most expensive street on the monopoly board I believe):https://independent.ie/irish-news/dermot-desmonds-ballymun-towers-south-dublin-tag-for-plan-on-ex-rte-land-branded-incredible-39510797.html
Cyrus wrote: » The more relevant factor is the people who also have the same needs and wants and what their spending power is imo . In areas where the majority are owner occupiers that’s the biggest factor and rental yield is less so.
Cyrus wrote: » Desmond didn’t want apartments of that scale built in Donnybrook , that doesn’t mean it’s not desirable ? And it doesn’t really impact ailsbury road anyway.
schmittel wrote: » If investors are piling in for yield because the state is to all intents and purposes setting a floor for rents, then the state is essentially setting the price at the margin. The Redrock deal I posted yesterday is a perfect example. If the state is driving prices upwards by their activity in the market, then Props is bang on the money. Once again.
Marius34 wrote: » Props was wrong here. He was the one on opposite side over half year ago, saying the Government won't be able to push prices this time. And now it appears they are, and will be a competitors on the demand side.
PropQueries wrote: » But it does take quite a certain level of incompetence for the current people in charge of housing to make everyone angry, quite literally, everyone from the billionaires living on Ailesbury Road right down to the people living on the street IMO
schmittel wrote: » So he is right now then?
Marius34 wrote: » Yes, in the sense that Government competes with buyers. I think this is obvious to almost everyone here. I'll say finally everyone is right on that part, even the ones who thought about the crash finally got it.
PropQueries wrote: » Hold on! Are we finally at the “acceptance” stage?
Marius34 wrote: » On the part that there are and will be demands from Government, REIT's and other organizations.. Always was, since joined this group, as I see lack of properties from many different sectors.
PropQueries wrote: » Well, once the government starts pulling in the purse strings, it will be interesting to see how long the funds remain interested when the state isn’t the renter of first and last resort IMO
PropQueries wrote: » While I don’t know the full reasons for their objections, I think any objections may have being at least partially to do with DCC agreeing to buy 61 of those c. 600+ apartments. Those 61 apartments are also all to be located in one block in the scheme from my understanding. It wouldn’t have taken the residents of Ailesbury Road and other nearby areas (IMO) long to then realise that the other 500+ apartments would also be most likely social housing in all but name (long-term leasing, HAP etc.), as nobody (with the means to buy them at the proposed asking prices) would then buy any of the remaining apartments due to this plan. People buy in such areas to live near their own class (in general) so it will definitely end up being primarily social housing, which is also apparently against current government policy of grouping social housing all in one area IMO
Hubertj wrote: » There are at least 1 million vacant properties around the country. The state should CPO them. Problem solved. They could also Airbnb the spares to raise revenue as I believe many local authorities have serious issues with rent arrears so they could net Airbnb revenue against rent arrears. I’m onto something here
