2021 Irish Property Market chat - mod warnings post 1

18-03-2021 02:11PM

Reins wrote: »

Was chatting to an estate agent yesterday - said there's a lot coming back to them ie sale agreed falling through.

This online bidding is only helping to inflate prices and then highest bidder only used it to get first refusal.

yeh, my agent told me the same. People are getting caught up in the frenzy and bidding beyond their affordability, then getting turned down by the bank after their offers were accepted. I needed a letter from my bank before the agent would take any offers from me once we were down to the last 3 or 4 interested parties.

Also some falling through as people have gone on furlough and banks have pulled their approval.

cnocbui · 18-03-2021 02:17PM

Deleted User wrote: »

Just going through a rural property purchase, stumbled on this thread, and thought I would share my experience.

have been looking for a rural cottage for remote working away from Dublin - the stereotypical narrative I suppose of the flight to rural locations due to COVID and flexible working opportunities. Luckily broadband in the property is pretty good. Wanted a cottage in a quiet coastal location, no more than 2.5 hours from Dublin with some character, good aspect, etc, rather than a new build bungalow

(as an aside, what the hell were people thinking with some of these bungalows that have gone up in the last 30 years - no consideration to aspect, light, layout, use of land - just shocking properties in many cases. Structurally sound, maybe, but would be better pulled down and started again!!)

Such properties come up rarely, and I have missed out on two in the last 8 months. Anyway, I just succeeded in having my offer accepted on the third go.

My point is that all of these went for 25-30% above asking after intense bidding wars, with huge jumps in offers during the process. One party increased the offer by 12% of the asking price in one go, obviously trying to kill off the competition (unsuccessfully). I will end up paying 27% above asking. And the place is by no means perfect (though it will be when I am done with it). Sure, the national HPI shows a modest % increase y-o-y, but that completely masks what is an absolute crazy bidding war out there in some sectors and locations. The demand out there in this space just staggered me, and I thought was worthy of posting

Music to my ears, since I am hoping to put a 4 bedroom rural bungalow on the market this year - touch wood.

I suspect you can blame the planning system and it's restrictions for most of the failings in bungalows you mention. People think it's great to remove decision making powers from people who actually own property and leave such things to public servants who don't have to live in, afford, put up with, or sell, the things they are imposing on others.

cnocbui · 18-03-2021 02:25PM

PropQueries wrote: »

Entirely possible. But if large future increases in property taxes are signaled in the next budget (especially on second homes), it may give such potential second home buyers pause for thought as there may be a significant cost attached in having a second home for e.g. flexible working etc. in future years IMO

And there is potentially over 90,000 of them to choose from.

That's great, we will be back to people pulling slates off the roofs of old buildings as happened in the past. Something about not learning from history and being condemned to repeat it?

Didn't the British impose a window tax on the subjugated irish who couldn't afford to pay so they bricked up all their windows and lived in dark hovels ?

More and higher taxes are the answer to all problems, bring them on, can't wait.

Hubertj · 18-03-2021 02:36PM

[Deleted User] wrote: »

Just going through a rural property purchase, stumbled on this thread, and thought I would share my experience.

have been looking for a rural cottage for remote working away from Dublin - the stereotypical narrative I suppose of the flight to rural locations due to COVID and flexible working opportunities. Luckily broadband in the property is pretty good. Wanted a cottage in a quiet coastal location, no more than 2.5 hours from Dublin with some character, good aspect, etc, rather than a new build bungalow

(as an aside, what the hell were people thinking with some of these bungalows that have gone up in the last 30 years - no consideration to aspect, light, layout, use of land - just shocking properties in many cases. Structurally sound, maybe, but would be better pulled down and started again!!)

Such properties come up rarely, and I have missed out on two in the last 8 months. Anyway, I just succeeded in having my offer accepted on the third go.

My point is that all of these went for 25-30% above asking after intense bidding wars, with huge jumps in offers during the process. One party increased the offer by 12% of the asking price in one go, obviously trying to kill off the competition (unsuccessfully). I will end up paying 27% above asking. And the place is by no means perfect (though it will be when I am done with it). Sure, the national HPI shows a modest % increase y-o-y, but that completely masks what is an absolute crazy bidding war out there in some sectors and locations. The demand out there in this space just staggered me, and I thought was worthy of posting

Congratulations on your purchase. Great to have this choice and improve work life balance. Are you planning to live there full time or will you also maintain a base in Dublin?

PropQueries · 18-03-2021 03:00PM

cnocbui wrote: »

That's great, we will be back to people pulling slates off the roofs of old buildings as happened in the past. Something about not learning from history and being condemned to repeat it?

Didn't the British impose a window tax on the subjugated irish who couldn't afford to pay so they bricked up all their windows and lived in dark hovels ?

More and higher taxes are the answer to all problems, bring them on, can't wait.

Well most people don't have second homes and their only assets are their income, home and pension.

It's a way of generating significant revenues without impacting on the majority of the voting public (working class or middle class) and I would be amazed if they haven't already drawn up such a policy that is ready to go and be implemented by the end of this year IMO

Hubertj · 18-03-2021 03:10PM

[Deleted User] wrote: »

Just going through a rural property purchase, stumbled on this thread, and thought I would share my experience.

have been looking for a rural cottage for remote working away from Dublin - the stereotypical narrative I suppose of the flight to rural locations due to COVID and flexible working opportunities. Luckily broadband in the property is pretty good. Wanted a cottage in a quiet coastal location, no more than 2.5 hours from Dublin with some character, good aspect, etc, rather than a new build bungalow

(as an aside, what the hell were people thinking with some of these bungalows that have gone up in the last 30 years - no consideration to aspect, light, layout, use of land - just shocking properties in many cases. Structurally sound, maybe, but would be better pulled down and started again!!)

Such properties come up rarely, and I have missed out on two in the last 8 months. Anyway, I just succeeded in having my offer accepted on the third go.

My point is that all of these went for 25-30% above asking after intense bidding wars, with huge jumps in offers during the process. One party increased the offer by 12% of the asking price in one go, obviously trying to kill off the competition (unsuccessfully). I will end up paying 27% above asking. And the place is by no means perfect (though it will be when I am done with it). Sure, the national HPI shows a modest % increase y-o-y, but that completely masks what is an absolute crazy bidding war out there in some sectors and locations. The demand out there in this space just staggered me, and I thought was worthy of posting

Congratulations on your purchase. Great to have this choice and improve work life balance. Are you planning to live there full time or will you also maintain a base in Dublin?

Browney7 · 18-03-2021 03:13PM

Reins wrote: »

Was chatting to an estate agent yesterday - said there's a lot coming back to them ie sale agreed falling through.

This online bidding is only helping to inflate prices and then highest bidder only used it to get first refusal.

Is his thesis that people are bidding more than they would if they viewed a property or that people are "viewing" and bidding on more properties? Before, if people were viewing with an intention of bidding they might get to look at 4 or 5 on a Saturday morning whereas now its all done remotely so each buying unit could have bids out everywhere.

Would agree that properties that tick all the boxes are likely to do very well at present

fliball123 · 18-03-2021 03:16PM

PropQueries wrote: »

Well most people don't have second homes and their only assets are their income, home and pension.

It's a way of generating significant revenues without impacting on the majority of the voting public (working class or middle class) and I would be amazed if they haven't already drawn up such a policy that is ready to go and be implemented by the end of this year IMO

What your asking for will further push more power onto REITS and vulture funds and the small landlord will be a thing of the past. Be careful what you wish for

PropQueries · 18-03-2021 03:29PM

fliball123 wrote: »

What your asking for will further push more power onto REITS and vulture funds and the small landlord will be a thing of the past. Be careful what you wish for

REITs etc. have little to no interest in properties outside prime locations. They're not even interested in second-hand houses in prime locations.

They're mostly interested in apartments as they're easy to manage and manipulate for rent increases submitted to the RTB e.g. just keep 3 apartments vacant and continually advertise them at €2,500 a month on Daft.ie and any tenant taking a case to the RTB over "market rents" will automatically lose.

fliball123 · 18-03-2021 03:35PM

PropQueries wrote: »

REITs etc. have little to no interest in properties outside prime locations. They're not even interested in second-hand houses in prime locations.

They're mostly interested in apartments as they're easy to manage and manipulate for rent increases submitted to the RTB e.g. just keep 3 apartments vacant and continually advertise them at €2,500 a month on Daft.ie and any tenant taking a case to the RTB over "market rents" will automatically lose.

Are you sure of that?

PropQueries · 18-03-2021 03:40PM

fliball123 wrote: »

Are you sure of that?

Near enough yes. Unless you're referring to the Iris Reit's houses in (I think Coolmine was that documentary on RTE a few years back) that they're renting to the state at €2,000 plus a month.

fliball123 · 18-03-2021 03:42PM

PropQueries wrote: »

Near enough yes. Unless you're referring to the Iris Reit's houses in (I think Coolmine was that documentary on RTE a few years back) that they're renting to the state at €2,000 plus a month.

Just wondering where your getting your info from. Like have you evidence that this is the case?

PropQueries · 18-03-2021 03:44PM

fliball123 wrote: »

Just wondering where your getting your info from. Like have you evidence that this is the case?

I'm fairly sure the vast majority of Iris Reit's properties are apartments?

fliball123 · 18-03-2021 03:45PM

PropQueries wrote: »

I'm fairly sure the vast majority of Iris Reit's properties are apartments?

Once again evidence??

DataDude · 18-03-2021 03:47PM

fliball123 wrote: »

Once again evidence??

I have no views/interest on this matter, but this is from their website homepage might help to stop the over and back!
https://www.iresreit.ie/

"Irish Residential Properties REIT Plc (I•RES) purchases and accumulates high quality apartment assets to let in the greater Dublin area.

Apartments are let and managed with the goal of providing superior customer service and high quality, safe, secure and comfortable homes for all our tenants."

Summer2020 · 18-03-2021 03:48PM

fliball123 wrote: »

Just wondering where your getting your info from. Like have you evidence that this is the case?

Of course he doesn’t. Like everything he posts it can’t be backed with facts. He’s “fairly sure”. Just like he’s “certain” prices are going to drop 75% by this time next year.

Browney7 · 18-03-2021 03:51PM

fliball123 wrote: »

Once again evidence??

Their annual report might be a good place to look

Reins · 18-03-2021 03:55PM

Browney7 wrote: »

Is his thesis that people are bidding more than they would if they viewed a property or that people are "viewing" and bidding on more properties? Before, if people were viewing with an intention of bidding they might get to look at 4 or 5 on a Saturday morning whereas now its all done remotely so each buying unit could have bids out everywhere.

Would agree that properties that tick all the boxes are likely to do very well at present

reckons bidding more just so they can be the successful candidate. Then pull out when viewed it in person. Reasons given " A change of heart " or Not the right fit for us "

fliball123 · 18-03-2021 03:57PM

DataDude wrote: »

I have no views/interest on this matter, but this is from their website homepage might help to stop the over and back!
https://www.iresreit.ie/

"Irish Residential Properties REIT Plc (I•RES) purchases and accumulates high quality apartment assets to let in the greater Dublin area.

Apartments are let and managed with the goal of providing superior customer service and high quality, safe, secure and comfortable homes for all our tenants."

Well not to nitpick but is this just one of the REITS operating here. I doubt that they would not be buying houses as well as apartments. I mean a house would garner a higher rental yield along with no management fees. Seems pretty short sighted if they were not gobbling up houses as well

https://dublingazette.com/news/news-city-edition/reits-vulture-22022/

https://www.independent.ie/business/personal-finance/property-mortgages/cuckoo-funds-now-own-15500-homes-in-ireland-after-latest-175bn-splurge-40016057.html

https://www.alliedirishproperty.ie/?gclid=CjwKCAjw9MuCBhBUEiwAbDZ-7sHhTQa_2vSLLyBlB4a0o6m-fQYinqkx0DS9Zi-82JpCC4L_0biyFxoCVBMQAvD_BwE

This is 3 of many links which would show they are looking at and/or buying houses as well

DataDude · 18-03-2021 04:05PM

fliball123 wrote: »

Well not to nitpick but is this just one of the REITS operating here. I doubt that they would not be buying houses as well as apartments.

https://dublingazette.com/news/news-city-edition/reits-vulture-22022/

I'm not a property investor, but from what I understand apartments in prime areas offer significantly more attractive rental yields than other investment types. 2 bed apartments in town are pretty much priced directly off their rental yield (5% or whatever the going rate these days). An old 4 bed Georgian house in SCD, or even more so in rural areas, is priced off what families are willing to pay for them to live there and typically not as directly correlated to their potential rental yield.

I'm sure there some REIT's bidding on second hand houses, but I'd imagine it's niche rather than widespread. I'd say it's particularly rare outside the cities. (A somewhat educated guess rather than based on facts!)

Where they bid on houses I suspect they prefer to buy new-builds on masse as it is operationally easier to negotiate directly with a builder for 100s of homes in one go rather than individual sellers, and I really doubt they want the potential hassle of buying second hand homes with wear and tear issues.

fliball123 · 18-03-2021 04:07PM

DataDude wrote: »

I'm not a property investor, but from what I understand apartments in prime areas offer significantly more attractive rental yields than other investment types. 2 bed apartments in town are pretty much priced directly off their rental yield (5% or whatever the going rate these days). An old 4 bed Georgian house in SCD, or even more so in rural areas, is priced off what families are willing to pay for them to live there and typically not as directly correlated to their potential rental yield.

I'm sure there some REIT's bidding on second hand houses, but I'd imagine it's niche rather than widespread. I'd say it's particularly rare outside the cities. (A somewhat educated guess rather than based on facts!)

Maybe point being there is no proof of it. I have put up 3 links that show REITS are buying up houses. So back to my original point if we keep taxing the hell out of small landlords more power will be given to the REITS/Vultures as they will be the only landlord in town and instead of rents decreasing they will have a tight hold on rental supply and can strangle supply to the market until they get the rental price they want.

PropQueries · 18-03-2021 04:11PM

fliball123 wrote: »

Maybe point being there is no proof of it. I have put up 3 links that show REITS are buying up houses. So back to my original point if we keep taxing the hell out of small landlords more power will be given to the REITS/Vultures as they will be the only landlord in town and instead of rents decreasing they will have a tight hold on rental supply and can strangle supply to the market until they get the rental price they want.

I believe the argument was they don't have much interest in buying second-hand houses either in prime or non-prime locations. New built houses in estates are just like apartments. Generally all the same and easily leased in bulk to the council.

fliball123 · 18-03-2021 04:13PM

PropQueries wrote: »

I believe the argument was they don't have much interest in buying second-hand houses either in prime or non-prime locations. New built houses in estates are just like apartments. Generally all the same and easily leased to the council.

So is the majority of the second hand housing market I know of people who have done this bought houses in places like Finglas said there you go council have at it. One of the links I put up is a REIT actively telling house owners they will buy their property. You cant get much more proof than that

DataDude · 18-03-2021 04:14PM

fliball123 wrote: »

Maybe point being there is no proof of it. I have put up 3 links that show REITS are buying up houses. So back to my original point if we keep taxing the hell out of small landlords more power will be given to the REITS/Vultures as they will be the only landlord in town and instead of rents decreasing they will have a tight hold on rental supply and can strangle supply to the market until they get the rental price they want.

I scanned the three links and if anything I would take them to all but confirm my viewpoint?

"The sector is dominated by a handful of huge players who now regularly buy hundreds of apartments and houses at a time in schemes that are no longer offered to individual buyers.

While cuckoo funds have displaced owner-occupiers, they increasingly also order entire schemes off the plans which industry experts say would not be viable for developers building for traditional buyers. These so-called forward-commit transactions accounted for 54pc of spend in residential investment in 2020 and will add to overall housing supply into the future."

"There are four REITs – Green, Hibernia, Yew Grove and Irish Residential Properties – listed on the Irish Stock Exchange, which own around €3.7 billion worth of property." - IRES being the largest residential landlord (3000+ homes), and their annual investor report confirms they are pretty much exclusively apartments. https://investorrelations.iresreit.ie/shareholder-centre/reports-and-presentations/year/2021

I'm not sure how any of the above would lead one to conclude REITS are a big player in the second hand non-apartment/new build market...?

PropQueries · 18-03-2021 04:19PM

fliball123 wrote: »

So is the majority of the second hand housing market I know of people who have done this bought houses in places like Finglas said there you go council have at it. One of the links I put up is a REIT actively telling house owners they will buy their property. You cant get much more proof than that

Wait

Have you just agreed with my opinion a few weeks ago that the council is indeed involved in many of the houses currently for sale as either as the counter-bidder (buyer) or the end renter and therefore basically either out-bidding or driving up the end sales prices for many families bidding for many of the homes currently advertised for sale?

18-03-2021 04:20PM

cnocbui wrote: »

The location came third, I didn't say it was irrelevant.

If you have 3 children, your primary consideration is a dwelling that is big enough to house you and them, if not, it ought to be. The location is dictated by your budget, so affordability is the second most important consideration.

This thread has recently been full of links to properties in desirable locations but the discussion is all about condition, internal outdated layouts, kitchens, insulation and the cost of renovation and how those properties are not suitable choices because of thes factors. People are not saying, great location, I'll ring the EA right away.

On the other thread, there are numerous complaints of lack of availability and that all that is available are properties in severe need of renovation, so even though they may be in the right location, again it's practical concerns about the nature and affordability of the property that seem to be the most important criteria.

Actually, I will admit I was wrong initiallly - affordability is the main criteria, as that determines what location you can 'afford' to look at and what 'size and condition of property' you can afford.

If you have 3 kids, and you think you need 4 bedrooms, then that is your no 1 criteria. Your budget determines in what locations you can afford such a thing.

well you were very lucky that you could live anywhere you wanted to in the country. some of us have to live close to work or commutable distance to work:rolleyes:

fliball123 · 18-03-2021 04:22PM

DataDude wrote: »

I scanned the three links and if anything I would take them to all but confirm my viewpoint?

"The sector is dominated by a handful of huge players who now regularly buy hundreds of apartments and houses at a time in schemes that are no longer offered to individual buyers.

While cuckoo funds have displaced owner-occupiers, they increasingly also order entire schemes off the plans which industry experts say would not be viable for developers building for traditional buyers. These so-called forward-commit transactions accounted for 54pc of spend in residential investment in 2020 and will add to overall housing supply into the future."

"There are four REITs – Green, Hibernia, Yew Grove and Irish Residential Properties – listed on the Irish Stock Exchange, which own around €3.7 billion worth of property." - IRES being the largest residential landlord (3000+ homes), and their annual investor report confirms they are pretty much exclusively apartments. https://investorrelations.iresreit.ie/shareholder-centre/reports-and-presentations/year/2021

I'm not sure how any of the above would lead one to conclude REITS are a big player in the second hand non-apartment/new build market...?

OK well page 3 of IRES states it owns 3,688 apartments and
houses for private rental in Ireland and doesn't give a breakdown

fliball123 · 18-03-2021 04:25PM

PropQueries wrote: »

Wait Have you just agreed with my opinion a few weeks ago that the council is indeed involved in many of the houses currently for sale as either as the counter-bidder (buyer) or the end renter and therefore basically either out-bidding or driving up the end sales prices for many families bidding for many of the homes currently advertised for sale?

I never disagreed with you on that point and in fact I have been saying for over a year that part of the reason why we wouldnt see a drop in house prices way back at the start of 2020 was that people are competing with both REITS/Vultures and the state to buy a house. So I think you might have me confused with someone else.

Villa05 · 18-03-2021 04:33PM

fliball123 wrote:

OK well page 3 of IRES states it owns 3,688 apartments and houses for private rental in Ireland and doesn't give a breakdown

Will post a podcast (from the Irish times)later where a developer is interviewed and he states that reits and the state are the sole purchasers of new build apartments

fliball123 · 18-03-2021 04:37PM

Villa05 wrote: »

Will post a podcast (from the Irish times)later where a developer is interviewed and he states that reits and the state are the sole purchasers of new build apartments

Cool post it up be interested to find out if REITS are/or are not buying houses as well

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

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2021 Irish Property Market chat - mod warnings post 1