2021 Irish Property Market chat - mod warnings post 1

hometruths · 08-03-2021 01:21PM

fliball123 wrote: »

Well you put this post up. I am the one claiming that some property is affordable to some people and I have quantified this with the math using the median wage. Your using hyperbole with regards to your math where you think the average property price is 10 times the national wage which is an outright lie.

Now I understand all property for all people! Your mansions in Howth again :rolleyes:

fliball123 wrote: »

So prove that your statement that anyone saying property is currently affordable is bonkers???

Your posts speak for themselves.

donnaille · 08-03-2021 01:23PM

fliball123 wrote: »

I wouldnt stop him posting, at this stage if I see the letters IMO in his post I just go to the next post. The odd time he does comes up with some good facts and figures but then uses them to try and prove something else or contradicts a position he held a month back which is always funny

Great, you've managed to create your own echo chamber - well done.

fliball123 · 08-03-2021 01:27PM

schmittel wrote: »

Now I understand all property for all people! Your mansions in Howth again :rolleyes:

Your posts speak for themselves.

and yet you cant prove me wrong good carry on so..I have put the math up with the relevant data using the median not even the bloody average wage as that would of skewed the affordability up even further. So at least I quantified my position and used fact instead of a blatant lie of " property is 10 times the average wage" I think you need to look in the mirror there

Hubertj · 08-03-2021 01:37PM

donnaille wrote: »

Yes, is there a way to block posters whose opinion I do not agree with? - I cannot find this option.

I use the ignore function and am a big fan of it. Thoroughly recommend

Graham · 08-03-2021 02:28PM

Mod Note

if you want to discuss the Irish Property Market, welcome.

If you want to discuss your fellow posters, take it somewhere else. Fair warning, several posters are one snarky post away from an immediate threadban.

Do not reply to this post.

jill_valentine · 08-03-2021 03:13PM

fliball123 wrote: »

Sorry Jill I took the median wage including part time workers(so half our population are on over this amount and under it 36k) and using the current metrics that we borrow by and looking at the current stock of property available on myhome and over half the current stock is affordable by these metrics. This is not expressing bad faith its expressing the fact that there is property out there available for the average (median) and is affordable. Is all property affordable to all people ?? NO but like everywhere in the world people pay a premium for desirable areas and houses that are built to a higher standard. Now I do realise that asking price does not equal selling price, currently things are selling at a higher price point due to a supply issue. Also those on under the median have mechanism to help them buy.

Well, for a start, none of that was what framed in your response to the other poster. You asked them to prove nobody could buy anything anywhere. Don't pretend now you meant that to mean something else.

Regardless...

Help to Buy has by now been fairly well demonstrated not to have had any effect on affordability. It has helped basically no one get on a property ladder, since many - if not most - applicants could already afford to build something. HTB was the difference between one house and another, rather than no house or a house.

You might have meant Rebuilding Ireland, but it's not good news there either, as it's available to very few and even then rejects more than half of the applicants it gets (I've had an application rejected for one page going in on essentially the wrong colour paper). Some councils have a backlog of a year, for an approval that lasts only 6 months, and will not be extended. It is almost impossible to use in its current format - in all of 2020, DCC approved a grand total of 154 of these loans, Fingal something like 20. I can't even find a figure for how many got to drawdown stage, but given how much of an arseache the process is, I wouldn't be shocked if it was less than half. I've an APA in Loans and I find it a nightmare, best of luck to anyone else.

On the subject of sums -

You used MyHome.ie. Your Median figure is a bit beefier than mine IIRC, but we'll run with it. We can't search for 138 odd k, so we'll round all the way up to 150k while we're at it, in effect using a well above average median earner as our benchmark.

Excluding sites leaves us with around 1443 properties available to that above Median earner who would have 150k worth of buying power, in all the Republic of Ireland, excepting all other real world considerations, property conditions, and under the most generous terms. That number also does not account for bidding bumps, assumes the applicant has a flawless mortgage situation (eg no kids and isn't a contractor) and doesn't allow for subtraction of Auctions that mortgage buyers can't access because MyHome doesn't let you exclude them.

That's... I mean that's nothing, especially when half of workers are already shut out from the off and I know from my own experience that on MyHome a lot of them are already sold anyway and not taken off yet.

You're looking at, realistically, a thousand properties anywhere in the country in range of our above average worker, in a state of 5 million people. For perspective, the most recent data I can find lists 4,495 "single adults" alone on the homelessness register.

There is no intellectually honest way of looking at those figures and pretending they represent an affordable - ie realistically achievable through concerted effort - entry level property market. Even less if we're pretending it's as plausible for anyone to live and work in West Cork as it is Dublin City.

awec · 08-03-2021 03:22PM

jill_valentine wrote: »

Help to Buy has by now been fairly well demonstrated not to have had any effect on affordability. It has helped basically no one get on a property ladder, since many - if not most - applicants could already afford to build something.

It was never supposed to be this.

HTB was really just a politically convenient way to give developers greater incentive to build lots more houses.

Since you could only get out of it what you had put in yourself it was never going to help on the affordability side.

jill_valentine · 08-03-2021 03:26PM

awec wrote: »

It was never supposed to be this.

HTB was really just a politically convenient way to give developers greater incentive to build lots more houses.

Since you could only get out of it what you had put in yourself it was never going to help on the affordability side.

Fair point.

fliball123 · 08-03-2021 03:29PM

jill_valentine wrote: »

Well, for a start, none of that was what framed in your response to the other poster. You asked them to prove nobody could buy anything anywhere. Don't pretend now you meant that to mean something else.

Regardless...

Help to Buy has by now been fairly well demonstrated not to have had any effect on affordability. It has helped basically no one get on a property ladder, since many - if not most - applicants could already afford to build something. HTB was the difference between one house and another, rather than no house or a house.

You might have meant Rebuilding Ireland, but it's not good news there either, as it's available to very few and even then rejects more than half of the applicants it gets (I've had an application rejected for one page going in on essentially the wrong colour paper). Some councils have a backlog of a year, for an approval that lasts only 6 months, and will not be extended. It is almost impossible to use in its current format - in all of 2020, DCC approved a grand total of 154 of these loans, Fingal something like 20. I can't even find a figure for how many got to drawdown stage, but given how much of an arseache the process is, I wouldn't be shocked if it was less than half. I've an APA in Loans and I find it a nightmare, best of luck to anyone else.

On the subject of sums -

You used MyHome.ie. Your Median figure is a bit beefier than mine IIRC, but we'll run with it. We can't search for 138 odd k, so we'll round all the way up to 150k while we're at it, in effect using a well above average median earner as our benchmark.

Excluding sites leaves us with around 1443 properties available to that above Median earner who would have 150k worth of buying power, in all the Republic of Ireland, excepting all other real world considerations, property conditions, and under the most generous terms. That number also does not account for bidding bumps, assumes the applicant has a flawless mortgage situation (eg no kids and isn't a contractor) and doesn't allow for subtraction of Auctions that mortgage buyers can't access because MyHome doesn't let you exclude them.

That's... I mean that's nothing, especially when half of workers are already shut out from the off and I know from my own experience that on MyHome a lot of them are already sold anyway and not taken off yet.

You're looking at, realistically, a thousand properties anywhere in the country in range of our above average worker, in a state of 5 million people. For perspective, the most recent data I can find lists 4,495 "single adults" alone on the homelessness register.

There is no intellectually honest way of looking at those figures and pretending they represent an affordable - ie realistically achievable through concerted effort - entry level property market. Even less if we're pretending it's as plausible for anyone to live and work in West Cork as it is Dublin City.

The norm is now a couple buying so you need to double your stats. I framed it that way as he was pointing the bonkers jibe at me. We have been tooing and froing on here. I have said and proved that the average house is affordable for someone on the median wage. Now when I did my calcs if you check back on this. I said for a couple. I believe the majority of properties being purchased since the turn of the century has been by couples.

PropQueries · 08-03-2021 03:33PM

In relation to the price caps under the proposed affordable housing scheme, Highland Radio has provided some preliminary figures:

"Price caps will form part of the Housing Minister's new affordable housing plan.

They'll range from 450,000 euro in parts of Dublin to 225,000 in the likes of Leitrim, Donegal and Mayo, with the aim of minimising price inflation.

The scheme, which would see the State take a 30 percent stake in a property, is expected to go before Cabinet for approval this month."

So, what accounts for the €225k difference in the cost of building each of these "affordable" units" in Dublin compared to Mayo?

Given that construction material costs can't be much different between Co. Mayo and Co. Dublin and I don't believe that construction workers in Dublin are paid 4 to 5 to 10 times what they are in Co. Mayo, it just proves (to me anyway), that this scheme is just more scarce taxpayer money being put into the back pockets of land owners in Dublin, who, at this stage, must be primarily the funds who purchased all that land in Dublin from 2012 onwards IMO

Link to article on Highland Radio here: https://www.highlandradio.com/2021/03/07/price-caps-to-form-part-of-housing-ministers-affordable-housing-plan/

Fuzzy_Dunlop · 08-03-2021 04:25PM

Have the government ever clarified how it is intended for people to repay the stake the government takes and at what interest rates?

It's such a ridiculous proposal and is so obviously just going to increase prices and put money directly in developers pockets.

hometruths · 08-03-2021 04:29PM

awec wrote: »

It was never supposed to be this.

HTB was really just a politically convenient way to give developers greater incentive to build lots more houses.

Since you could only get out of it what you had put in yourself it was never going to help on the affordability side.

Should have been called the Help to Sell scheme so!

hometruths · 08-03-2021 04:31PM

fliball123 wrote: »

The norm is now a couple buying so you need to double your stats. I framed it that way as he was pointing the bonkers jibe at me. We have been tooing and froing on here. I have said and proved that the average house is affordable for someone on the median wage. Now when I did my calcs if you check back on this. I said for a couple. I believe the majority of properties being purchased since the turn of the century has been by couples.

I wonder why.

awec · 08-03-2021 04:38PM

schmittel wrote: »

Should have been called the Help to Sell scheme so!

It kind of helped people to buy... sooner than they otherwise would have bought anyway.

What happened was you had people who thought they'd be applying for a mortgage in 12-24 months time suddenly finding themselves ready to apply for a mortgage straightaway, and move into the house-hunting part of the process much sooner than they expected.

The issue was this was true for a lot of people, which meant prices went up. By design, it incentivized developers to build more.

This way gave them political cover, while also giving those on the scheme a tangible benefit, especially for the "squeezed middle" who very rarely see much direct benefit for their taxes. People bought a house 1/2/3 years ahead of schedule, at a price likely higher than they would have paid, but offset against 1/2/3 years worth of rent.

DataDude · 08-03-2021 05:18PM

Does anybody know if the following is possible to do:

Assume mortgage approval for an amount X (deposit and income criteria met for this amount). Family member willing to provide a low interest rate LOAN of Y (crucially not a gift, which I know would be allowed). Proceed to purchase property with loan of Y from family member and (X-Y) from the bank.

I know that inter family loans absolutely cannot be used to cover a shortfall in either LTV or LTI but wondering if this was not an issue, would it be possible? My gut feeling says no, since the bank probably don't want to get involved in a multi-creditor loan transaction but would be interested to hear if anyone has any experience on this.

Browney7 · 08-03-2021 05:19PM

Fuzzy_Dunlop wrote: »

Have the government ever clarified how it is intended for people to repay the stake the government takes and at what interest rates?

It's such a ridiculous proposal and is so obviously just going to increase prices and put money directly in developers pockets.

Why would an Irish government ever consider what will happen down the line? That's for the next schmuck to worry about.

jill_valentine · 08-03-2021 05:31PM

fliball123 wrote: »

The norm is now a couple buying so you need to double your stats. I framed it that way as he was pointing the bonkers jibe at me. We have been tooing and froing on here. I have said and proved that the average house is affordable for someone on the median wage. Now when I did my calcs if you check back on this. I said for a couple. I believe the majority of properties being purchased since the turn of the century has been by couples.

If the majority of properties being bought are bought by couples, but the biggest cohort of homeless people are single adults, what does that tell you?

This is a distortion of stats through a lens of survivor bias. I'm sure most properties will continue to be bought by couples when the entire single working population of the country have only a thousand affordable properties between them, and that figure includes stuff like this bright and airy 125k "detached house" in Oranmore:

https://www.myhome.ie/residential/brochure/dublin-road-oranmore-co-galway/4487638

Nobody but couples can buy. You would also easily find statistics about how surprisingly well deposit-equipped homebuyers are if you wanted, for the same reasons.

hometruths · 08-03-2021 05:35PM

DataDude wrote: »

Does anybody know if the following is possible to do:

Assume mortgage approval for an amount X (deposit and income criteria met for this amount). Family member willing to provide a low interest rate LOAN of Y (crucially not a gift, which I know would be allowed). Proceed to purchase property with loan of Y from family member and (X-Y) from the bank.

I know that inter family loans absolutely cannot be used to cover a shortfall in either LTV or LTI but wondering if this was not an issue, would it be possible? My gut feeling says no, since the bank probably don't want to get involved in a multi-creditor loan transaction but would be interested to hear if anyone has any experience on this.

If I’m reading that correctly the idea is to have smaller mortgage rather than more expensive house?

If that’s the case I’d Do it thus:, drawdown a mortgage for x, (contract without early repayment penalties etc) buy house, borrow y from family, repay y off mortgage or switch to new mortgage for x - y.

If think if you start introducing low interest family loans pre drawdown, somebody somewhere might raise an eyebrow, even for no good reason.

DataDude · 08-03-2021 05:43PM

schmittel wrote: »

If I’m reading that correctly the idea is to have smaller mortgage rather than more expensive house?

If that’s the case I’d Do it thus:, drawdown a mortgage for x, (contract without early repayment penalties etc) buy house, borrow y from family, repay y off mortgage or switch to new mortgage for x - y.

If think if you start introducing low interest family loans pre drawdown, somebody somewhere might raise an eyebrow, even for no good reason.

Yes precisely.

We did consider your early repayment option alright, but the the only thing is by far the best value mortgage for us does not allow early repayment without penalty. Paying the penalty or going with one of the worse value lenders which allow early repayment would take most of the financial benefit out of having a part of the mortgage at a lower rate.

I did consider just waiting out the 3 year fixed period and switch like you have outlined...but I assume at point of switching all the same potential issues would crop up around "where did your equity come from?".

awec · 08-03-2021 05:43PM

I would think the bank would want an explanation on where the money for the difference is coming from.

DataDude · 08-03-2021 05:46PM

awec wrote: »

I would think the bank would want an explanation on where the money for the difference is coming from.

For sure, and there's nothing dodgy going on here so I would be more than happy to explain to them. Family member getting 0% on deposit. Me paying 2.2% on mortgage. Loan at 1% between us works all round.

From the banks perspective it shouldn't make a difference really, if anything it would be lower risk, especially if the inter family loan did not have any claim against the property and they retained that 100% which we would agree to. But I guess they might just have a standard policy to avoid such an agreement because it's non-standard.

hometruths · 08-03-2021 05:50PM

DataDude wrote: »

Yes precisely.

We did consider your early repayment option alright, but the the only thing is by far the best value mortgage for us does not allow early repayment without penalty. Paying the penalty or going with one of the worse value lenders which allow early repayment would take most of the financial benefit out of having a part of the mortgage at a lower rate.

I did consider just waiting out the 3 year fixed period and switch like you have outlined...but I assume at point of switching all the same potential issues would crop up around "where did your equity come from?".

I would guess a bank looking at getting a new mortgage client from a switcher with solid 3 year payment record, and solid LTV would be far less interested in the detail of this boost in equity in the property than new mortgage business for an FTB who basically has a boost in his deposit.

Essentially the same thing but optics are different in three years time.

awec · 08-03-2021 05:55PM

DataDude wrote: »

For sure, and there's nothing dodgy going on here so I would be more than happy to explain to them. Family member getting 0% on deposit. Me paying 2.2% on mortgage. Loan at 1% between us works all round.

From the banks perspective it shouldn't make a difference really, if anything it would be lower risk, especially if the inter family loan did not have any claim against the property and they retained that 100% which we would agree to. But I guess they might just have a standard policy to avoid such an agreement because it's non-standard.

Banks generally have no issues with loans on top of your mortgage once it doesn't impact affordability, but I think they may be somewhat concerned about the peculiarities of what you'd be doing and they may think that not all is what it seems.

To be honest, I don't think you have anything to lose from asking the bank. As you've said, you're not trying to hide it.

Cyrus · 08-03-2021 06:15PM

DataDude wrote: »

For sure, and there's nothing dodgy going on here so I would be more than happy to explain to them. Family member getting 0% on deposit. Me paying 2.2% on mortgage. Loan at 1% between us works all round.

From the banks perspective it shouldn't make a difference really, if anything it would be lower risk, especially if the inter family loan did not have any claim against the property and they retained that 100% which we would agree to. But I guess they might just have a standard policy to avoid such an agreement because it's non-standard.

it depends on how large the amount is but what i would be inclined to do is take a large mortgage (with cashback) on a short fixed period, at the end of the fixed period partially redeem the mortgage with the loan from the family member and then switch to avant for the lowest fixed rate.

that way you get the one decent benefit of a large mortgage which is cash back and you still end up with the best rate a year later with the smaller mortgage.

the bank you are switching to at that point may ask, they may not, but regardless i cant see how its an issue for them. Especially if you would have qualified for the larger amount in the first place.

fliball123 · 08-03-2021 06:22PM

jill_valentine wrote: »

If the majority of properties being bought are bought by couples, but the biggest cohort of homeless people are single adults, what does that tell you?

This is a distortion of stats through a lens of survivor bias. I'm sure most properties will continue to be bought by couples when the entire single working population of the country have only a thousand affordable properties between them, and that figure includes stuff like this bright and airy 125k "detached house" in Oranmore:

https://www.myhome.ie/residential/brochure/dublin-road-oranmore-co-galway/4487638

Nobody but couples can buy. You would also easily find statistics about how surprisingly well deposit-equipped homebuyers are if you wanted, for the same reasons.

It tells me that the government has let down the country on building social housing.

Cyrus · 08-03-2021 06:28PM

jill_valentine wrote: »

If the majority of properties being bought are bought by couples, but the biggest cohort of homeless people are single adults, what does that tell you?

This is a distortion of stats through a lens of survivor bias. I'm sure most properties will continue to be bought by couples when the entire single working population of the country have only a thousand affordable properties between them, and that figure includes stuff like this bright and airy 125k "detached house" in Oranmore:

https://www.myhome.ie/residential/brochure/dublin-road-oranmore-co-galway/4487638

Nobody but couples can buy. You would also easily find statistics about how surprisingly well deposit-equipped homebuyers are if you wanted, for the same reasons.

out of interest and this is a genuine question, what should a single person on the median income be able to buy in your opinion, say in a major urban centre and rurally?

DataDude · 08-03-2021 06:37PM

Cyrus wrote: »

it depends on how large the amount is but what i would be inclined to do is take a large mortgage (with cashback) on a short fixed period, at the end of the fixed period partially redeem the mortgage with the loan from the family member and then switch to avant for the lowest fixed rate.

that way you get the one decent benefit of a large mortgage which is cash back and you still end up with the best rate a year later with the smaller mortgage.

the bank you are switching to at that point may ask, they may not, but regardless i cant see how its an issue for them. Especially if you would have qualified for the larger amount in the first place.

Thanks, the above plan re. cashback for short term fixed before moving to Avant is what we were planning to do regardless before the family member proposed the arrangement. We will proceed down this route and hopefully Avant are happy to accept the "extra equity" provided by family.

Mic 1972 · 08-03-2021 06:41PM

PropQueries wrote: »

Well, given that there are only 2,948 properties currently for sale in Co. Dublin on MyHome.ie and DCC have recently stated they're in active negotiations with c. 4,000 property owner in the city, I would hope they all realise who is most likely bidding against them.

And DCC is just one of 4 councils in Co. Dublin.

I would think having an idea of who the probable counter-bidder is would be a very important factor on when deciding on what to bid.

The numbers alone are evidence that the state is negotiating over properties not listed on Daft and MyHome.

Graham · 08-03-2021 06:55PM

PropQueries wrote: »

DCC have recently stated they're in active negotiations with c. 4,000 property owner in the city, I would hope they all realise who is most likely bidding against them

Do you have a source for that PQ?

PropQueries · 08-03-2021 07:02PM

Graham wrote: »

Do you have a source for that PQ?

The figure was quoted in an Irish Independent article two weeks ago:

"Dublin City Council Fine Gael councillors have written to the Housing Minister urging him to scrap the shared equity scheme in the Government’s affordable housing plan."

"The letter also gives an example of how the €75m could be repurposed, as there are currently 4,000 homes within Dublin City Council which have been earmarked for affordable purchase or rental."

Link to article in Irish Independent here: https://www.independent.ie/news/risks-return-to-failed-housing-policies-of-the-celtic-tiger-era-housing-minister-urged-to-scrap-shared-equity-scheme-in-housing-plan-40119194.html

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

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2021 Irish Property Market chat - mod warnings post 1