2021 Irish Property Market chat - mod warnings post 1

donnaille · 29-03-2021 11:16AM

cnocbui wrote: »

In Oz, a property in inner Sydney went for $1.4 M over reserve a few days ago.

Is that +10%, 20%, 50%, 100%? etc.

PropQueries · 29-03-2021 11:35AM

The minister for rural affairs has stated that 20% of public sector employees will be working remotely by the end of this year. Not 2022, not 2023, this year. And, she also said that that percentage will be increased every year going forward.

She also said: "There are many young people who moved to Dublin because it represented their only prospect of securing work. My message is let’s give those people a choice."

So, that's the first rung on the current Dublin housing market pyramid scheme being gradually removed. That will reverberate on house prices all the way up to the very top very quickly IMO

Link to article in Irish Independent here: https://www.independent.ie/irish-news/rural-future-plan-relocation-grants-andtax-breaks-to-lure-workersfrom-cities-to-ruraltowns-40249817.html

hometruths · 29-03-2021 11:39AM

fliball123 wrote: »

Well what I would say is the govenment had stopped borrowing in 2018 and 2019 and turned a surplus for 2019 (the rainy day fund) so the deficit had been bridged. Now they are borrowing for covid and this has added another 20 billion on top so I think its this money that will flow into what the govenment spend on and that will include the government buying houses competing with your bog standard Ann and Barry along side renting property from REITS and Vultures and any other private landlord to give to those who cant afford to pay rent I think that may be inflating a bubble now. The money may have been there pre 2021 but property prices up until about September of last year would bear out that there was no bubble as prices jumped up and down and not just up. Its hard to know when your in a bubble its always hindsight when it bursts.

Exactly. Which is why your certainty that we have not been in a bubble pre 2021 is suspect at best. IMO.

Mad_maxx · 29-03-2021 11:40AM

LasersGoPewPew wrote: »

The ECB won't allow interest rates to rise given the state of European economies. Employment in 'high' earning sectors like financial services, IT, legal, health, engineering won't be affected. People working in these sectors will continue to support the market. Supply is low, demand is high so a collapse won't happen. It's not like the end of the celtic tiger where there as an oversupply and a credit crunch. People are not getting 100% mortgages like they were in the naughtys.

you also dont have a Jean Claude Trichet at the head of the ECB who tightened credit during the 2008 - 2012 recession and even raised rates at one stage

credit is plentiful right now , different situation entirely now in terms of attitude from the central banks

Villa05 · 29-03-2021 11:41AM

LasersGoPewPew wrote:

. Employment in 'high' earning sectors like financial services, IT, legal, health, engineering won't be affected. People working in these sectors will continue to support the market. Supply is low, demand is high so a collapse won't happen. It's not like the end of the celtic tiger.

Most of the people employed in the sectors you mention won't be paying up to 800k for a 2 bed apartment which is what is currently happening for social and affordable.

In theory what is happening is worse than the Celtic tiger, as price for everyone is being set by what the top 15/20% earn. It's akin to a policy that everybody's car must be a shiny new mid range BMW

In the Celtic tiger there were multiple markets at multiple price points and let's face it after the Celtic tiger the vast majority of buyers came out the other side without too much damage

Those that cannot afford to buy are left to the rental market to be fleeced

The state is the biggest bankroller of all this madness and has in its power the necessary ingredients to solve it, but won't and instead makes it worse.

Can you remember what happened the entities that bankrolled the Celtic tiger.
A crash is inevitable, just a matter of when

Mad_maxx · 29-03-2021 11:42AM

The_Conductor wrote: »

The ECB doesn't give a rats arse about employment- they have one metric they look at- and that is the consumer inflation index. If/when it exceeds 2%- they will raise rates.

Also- whether we like it or not- the ECB dances to Germany's tune- what Germany wants, they pretty much get. At the moment German pensioners are hurting badly from the interest rate regime. This has been highlighted several times (even in Bild last weekend). It beggars belief that that the wishes of German pensioners are not going to feature prominently in what the ECB does or doesn't do- esp. given the federal elections coming up in Germany later this year- and how terrified the CDU are after their recent election failures.

Ireland is a minnow- while we have a voice, we only have a little voice, and our wishes at the table are right at the bottom of the list. Anyone who imagines otherwise is delusional. We are going to be dancing to the tune of the pensioners of Germany- whether we like it, or not.

at a time when the EU project is as shaky as it is , German pensioners and savers are going to have to suck it up , they are not going to drive the bus on this one

there will be no Trichet like moves at the ECB for a long time yet

mandrake04 · 29-03-2021 11:44AM

donnaille wrote: »

Is that +10%, 20%, 50%, 100%? etc.

about +25% it went for $6.9m.

https://www.domain.com.au/news/home-in-sydneys-inner-west-sells-1-4m-above-reserve-on-auction-super-saturday-1039749/

Its will be a knockdown rebuild for sure.

fliball123 · 29-03-2021 11:44AM

schmittel wrote: »

Exactly. Which is why your certainty that we have not been in a bubble pre 2021 is suspect at best. IMO.

Well look at the trajectory of actual selling prices from 2017 to mid 2020 and prices did not balloon up (which is what it should of done had we been in a bubble) they went up and down and up and down so that data in itself is proof we were not in a bubble then.

Mad_maxx · 29-03-2021 11:46AM

Villa05 wrote: »

Most of the people employed in the sectors you mention won't be paying up to 800k for a 2 bed apartment which is what is currently happening for social and affordable.

In theory what is happening is worse than the Celtic tiger, as price for everyone is being set by what the top 15/20% earn. It's akin to a policy that everybody's car must be a shiny new mid range BMW

In the Celtic tiger there were multiple markets at multiple price points and let's face it after the Celtic tiger the vast majority of buyers came out the other side without too much damage

Those that cannot afford to buy are left to the rental market to be fleeced

The state is the biggest bankroller of all this madness and has in its power the necessary ingredients to solve it, but won't and instead makes it worse.

Can you remember what happened the entities that bankrolled the Celtic tiger.
A crash is inevitable, just a matter of when

there are multiple markets today , outside the Dublin market ( and even particular Dublin micro markets ) , houses are still well below pre 2008 , circa 2006 , houses were crazy prices everywhere

you can still buy a three bed semi in Limerick city for under 300 k and thats in a very good area , most of Co Meath the same and parts of Kildare even

PropQueries · 29-03-2021 11:47AM

Mad_maxx wrote: »

at a time when the EU project is as shaky as it is , German pensioners and savers are going to have to suck it up , they are not going to drive the bus on this one

there will be no Trichet like moves at the ECB for a long time yet

I think you're mistaking our debt problems as a eurozone wide debt problem. The vast majority of eurozone members have no real debt problem and as a poster said this morning, it's german etc. pensioners that are suffering from this low interest rate environment.

Interest rates really are only going one way (they're less than zero, so they really can only go one way) and the only unknown is when and by how much.

But, it's not going to be more than 2 years away IMO

PropQueries · 29-03-2021 11:51AM

Mad_maxx wrote: »

there are multiple markets today , outside the Dublin market ( and even particular Dublin micro markets ) , houses are still well below pre 2008 , circa 2006 , houses were crazy prices everywhere

you can still buy a three bed semi in Limerick city for under 300 k and thats is a very good area , most of Co Meath the same and parts of Kildare even

Do you not think €300k is rather expensive for a house on a low population density island off an island off europe? Even a €300k price tag on any home in e.g. Ballsbridge appears expensive to me IMO

fliball123 · 29-03-2021 11:53AM

PropQueries wrote: »

I think you're mistaking our debt problems as a eurozone wide debt problem. The vast majority of eurozone members have no real debt problem and as a poster said this morning, it's german etc. pensioners that are suffering from this low interest rate environment.

Interest rates really are only going one way (they're less than zero, so they really can only go one way) and the only unknown is when and by how much.

But, it's not going to be more than 2 years away IMO

I cant see them being put up for a few years until Covid is gone and growth has come back into the Eurozone, putting up rates during a period of uncertainty would make the uncertainty more uncertain and as much as Germany or any other country might want this they know that if other countries are struggling that they will feel that pain as well and not one country has been immune from Coivid.

Mad_maxx · 29-03-2021 11:53AM

PropQueries wrote: »

I think you're mistaking our debt problems as a eurozone wide debt problem. The vast majority of eurozone members have no real debt problem and as a poster said this morning, it's german etc. pensioners that are suffering from this low interest rate environment.

Interest rates really are only going one way (they're less than zero, so they really can only go one way) and the only unknown is when and by how much.

But, it's not going to be more than 2 years away IMO

Japan has battled low inflation for three decades , growth in the EU ( or most of it bar Germany in terms of large countries ) has been slow for two decades , Brexit means that the EU family needs to unite more and not ignore the needs of countries smaller than Germany

Gemans need to spend more , lack of spending by Germans has long been a problem within the context of the broader EU

Villa05 · 29-03-2021 11:56AM

Mad_maxx wrote:

there are multiple markets today , outside the Dublin market ( and even particular Dublin micro markets ) , houses are still well below pre 2008 , circa 2006 , houses were crazy prices everywhere

So there is no need to pay 800k for a 2 bed social housing unit or lease one for up to 3k+ per month on an inflation linked long term lease.

PropQueries · 29-03-2021 11:57AM

Mad_maxx wrote: »

Japan has battled low inflation for three decades , growth in the EU ( or most of it bar Germany in terms of large countries ) has been slow for two decades , Brexit means that the EU family needs to unite more and not ignore the needs of countries smaller than Germany

Gemans need to spend more , lack of spending by Germans has long been a problem within the context of the broader EU

Low interest rates don't impact spending when people don't borrow because they're worried about how they will survive in their pensioner years i.e. they actually end up saving more.

It's a bit paradoxical, but current low interest rates signal to the consumer that the economy is still in trouble and consumers actually pull back spending rather then increase it.

A significant rise in interest rates may actually encourage consumer spending IMO

Mad_maxx · 29-03-2021 11:57AM

PropQueries wrote: »

Do you not think €300k is rather expensive for a house on a low population density island off an island off europe? Even a €300k price tag on any home in e.g. Ballsbridge appears expensive to me IMO

then you are viewing life as how you would like it to be rather than how it is

we have very strict building regulations in this country , building houses is expensive inherently nowadays no matter what David Mc Williams or SF says etc

there are more property markets today than in 2006 in terms of price variance , in 2006 , houses in the likes of Roscommon or Offaly were about 50% higher than today if not more , with covid and more remote working , lower cost home choices are now opening up , its certainly not the solution to all our problems but might be the one silver lining post covid

Mad_maxx · 29-03-2021 12:00PM

Villa05 wrote: »

So there is no need to pay 800k for a 2 bed social housing unit or lease one for up to 3k+ per month on an inflation linked long term lease.

those are micro issues and even within the context of institutional money leasing property to local authorities , not at all typical

PropQueries · 29-03-2021 12:02PM

Mad_maxx wrote: »

then you are viewing life as how you would like it to be rather than how it is

we have very strict building regulations in this country , building houses is expensive inherently nowadays no matter what David Mc Williams or SF says etc

there are more property markets today than in 2006 in terms of price variance , in 2006 , houses in the likes of Roscommon or Offaly were about 50% higher than today if not more , with covid and more remote working , lower cost home choices are now opening up , its certainly not the solution to all our problems but might be the one silver lining post covid

You're right about covid opening up the housing markets outside Dublin.

In relation to looking at it as how I would like it to be. Not really, if I truly thought the housing market was based on sound fundamentals. But, at the moment, I really don't see those fundamentals there. And my only real concern is that if I'm right, it's my home, my income and my pension that they will come looking to help pay for the clean up IMO

Mad_maxx · 29-03-2021 12:03PM

PropQueries wrote: »

You're right about covid opening up the housing markets outside Dublin.

In relation to looking at it as how I would like it to be. Not really, if I truly thought the housing market was based on sound fundamentals. But, at the moment, I really don't see those fundamentals there. And my only real concern is that if I'm right, it's my home, my income and my pension that they will come looking to help pay for the clean up IMO

you said a house in Ballsbridge should not cost 300 k ?

Villa05 · 29-03-2021 12:06PM

Mad_maxx wrote:

those are micro issues and even within the context of institutional money leasing property to local authorities , not at all typical

It appears to be happening on an industrial scale in Dublin.
Doubling of Hap payments in a year
Doubling of homeless services budget in a year

Are these micro issues

PropQueries · 29-03-2021 12:07PM

Mad_maxx wrote: »

you said a house in Ballsbridge should not cost 300 k ?

I don't see how a house in Ballsbridge can cost more than €300k. I also don't see how my house is worth what it currently is.

If I was currently selling my house, great. But I'm not and if my neighbour sells her house and then the property market goes back to fundamentals, I end up paying for the difference IMO

Yes, my neighbour will walk away with her current windfall, but I will be technically paying for it in the very near future IMO

Pussyhands · 29-03-2021 12:08PM

So is everything going above asking nowadays?

I'm single looking to buy an apartment and the current asking prices, some are above my desired range and some are there or thereabouts.

Mad_maxx · 29-03-2021 12:09PM

Villa05 wrote: »

It appears to be happening on an industrial scale in Dublin.
Doubling of Hap payments in a year
Doubling of homeless services budget in a year

Are these micro issues

i was referring to the long term leasing of very expensive property by institutional property players , leasing out 800 k property to local authorities is a rare event but one the left insist on as part of the social mix model they espouse

Hubertj · 29-03-2021 12:10PM

https://www.irishtimes.com/news/politics/new-rural-ireland-plan-says-20-of-public-sector-staff-to-work-remotely-by-end-of-2021-1.4522468

I hope this is implemented properly as it is a great idea. It has the potential to make a difference to work life balance. It will be interesting to see how it develops over the coming years. Opportunity for more rural towns to attract people and enterprises. Also people moving from cities to rural towns will bring a bit of civilisation and sophistication which is no harm 😂

Zenify · 29-03-2021 12:10PM

Call me naive, but I don't think German pensioners can sway the ECB. The ECB is independent or close to it. They will have to be seen as being focused on inflation.

Also, if they even flirt with the idea of focusing on employment and growing the economy we would have serious consequences. It would be worse for everyone. No investors would buy bonds as inflation would eat away their money. Government debt costs would go up anyway.

The ECB will focus on inflation, they will say lots of different things in the media about letting things go a little lose for a while. Their job is stability and they will say whatever is necessary to achieve that. But don't be mistaken if inflation goes above 3% (which is looking possible for the fist time in a decade) rates will rise. They will rise to whatever is needed to keep inflation near 2%. In the same way they did "Whatever it takes" in the past with loose money they will also do "whatever it takes" with tight money if it is needed.

People need to start using figures when talking about inflation. High inflation to me is above 2%. People here arguing about high inflation may actually be fighting over the same figure. High inflation is not 10% in today's climate.

Mad_maxx · 29-03-2021 12:11PM

PropQueries wrote: »

I don't see how a house in Ballsbridge can cost more than €300k. I also don't see how my house is worth what it currently is.

If I was currently selling my house, great. But I'm not and if my neighbour sells her house and then the property market goes back to fundamentals, I end up paying for the difference IMO

Yes, my neighbour will walk away with her current windfall, but I will be technically paying for it in the very near future IMO

thats philosophy , not economic reality , even in 2012 , you could not buy a house in Ballsbridge for 300 k

dontmindme · 29-03-2021 12:11PM

Mad_maxx wrote: »

then you are viewing life as how you would like it to be rather than how it is

we have very strict building regulations in this country , building houses is expensive inherently nowadays no matter what David Mc Williams or SF says etc

there are more property markets today than in 2006 in terms of price variance , in 2006 , houses in the likes of Roscommon or Offaly were about 50% higher than today if not more , with covid and more remote working , lower cost home choices are now opening up , its certainly not the solution to all our problems but might be the one silver lining post covid

You're seriously going to try and use some near height of the bubble figure as some sort of valid reference point?

Mad_maxx · 29-03-2021 12:14PM

dontmindme wrote: »

You're seriously going to try and use some near height of the bubble figure as some sort of valid reference point?

why not ?

the assertion that every market today is expensive is incorrect

fliball123 · 29-03-2021 12:14PM

dontmindme wrote: »

You're seriously going to try and use some near height of the bubble figure as some sort of valid reference point?

Well its a valid indicator of how high prices could currently go

awec · 29-03-2021 12:15PM

PropQueries wrote: »

I don't see how a house in Ballsbridge can cost more than €300k. I also don't see how my house is worth what it currently is.

If I was currently selling my house, great. But I'm not and if my neighbour sells her house and then the property market goes back to fundamentals, I end up paying for the difference IMO

Yes, my neighbour will walk away with her current windfall, but I will be technically paying for it in the very near future IMO

This is a bizarre viewpoint. Why pick such an arbitrary figure? How did you arrive at the conclusion that houses in Ballsbridge are worth 300k and nothing more?

Everything is relative. Ballsbridge is highly desirable so it has high prices. That's how the market works.

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

Comments

2021 Irish Property Market chat - mod warnings post 1