2021 Irish Property Market chat - mod warnings post 1

standardg60 · 01-04-2021 11:53PM

schmittel wrote: »

And I'm not just talking about pensioners looking to move to gated communities with panic alarms.

There was an ask the finance expert thing on newstalk today, and a couple had sent in a what are our options query on this subject.

Mid 50s or so, 100k in savings, 500k fully paid off empty nest house in Dublin. They own a plot of land in the country, have planning, want to move from Dublin build in country, leave Dublin, live the quiet life etc.

They cannot get a mortgage to cover build cost for new house but they do not want to sell current house and rent if they can avoid it. Expert said basically they didn't have many other options since bridging no longer available. The idea that this is a risky profile is nuts.

I suspect there is a huge number of people in a similiar boat: irrespective of age or location, they'd quite like to move out of a house that could be put to more efficient use, and this is where government should be putting their resources.

Upon what would the bridging loan be secured. The asset being sold or the asset yet to be acquired?

L1011 · 01-04-2021 11:55PM

standardg60 wrote: »

Upon what would the bridging loan be secured. The asset being sold or the asset yet to be acquired?

Nothing. Which is why they have (well, had - as I don't think they've been available for years) punitive interest rates, albeit as they were generally paid back within weeks it didn't cost that much.

hometruths · 02-04-2021 08:31AM

standardg60 wrote: »

Upon what would the bridging loan be secured. The asset being sold or the asset yet to be acquired?

The idea I'm suggesting is that it is specifically secured on the asset being sold, loan cleared on sale. If needs be, to reduce risk, could be secured on both until cleared.

L1011 wrote: »

Nothing. Which is why they have (well, had - as I don't think they've been available for years) punitive interest rates, albeit as they were generally paid back within weeks it didn't cost that much.

I don't see why a sightly different approach of lower interest rates and expected repayment timeframe of say a year could not be implemented. The high interest finance for a few weeks model is a very different buyer/transaction profile than what I am suggesting.

A key point would be that it is only available to people trading down in value, as the scheme would be designed to help free up more desirable stock in terms of size or location.

It would not be a mechanism to trade up from 3 bed semi in SCD to 4 bed detached in SCD, for example.

Hubertj · 02-04-2021 08:58AM

schmittel wrote: »

I kind of agree if, as Hubert says, its done well, and doesn't feel like a proxy for an old peoples home.

I guess my main point on this is we don't need to wait until we have purpose built developments for downsizers to encourage downsizing. There are plenty who will happily move into existing apartments/bungalows/mews etc if we could get the market moving.

I think It’s about providing people with more options and flexibility around where they might like to live. That will also help to speed up the process of trading down.

mcsean2163 · 02-04-2021 10:05AM

Bridging loan has been a big headache for us so sounds like a great idea.

For me, the most obvious solution is vacant property charge on third house for private individuals and all property for business institutions.

If a property is vacant for over a year the owner must pay 1% per year to keep it vacant. All REITS would have to lower rents and actually rent, right now there are huge numbers if vacant apartments in rent protection zones.

Such a scheme costs very little and would not impact people who've saved for a holiday home.

yagan · 02-04-2021 10:28AM

mcsean2163 wrote: »

Bridging loan has been a big headache for us so sounds like a great idea.

For me, the most obvious solution is vacant property charge on third house for private individuals and all property for business institutions.

If a property is vacant for over a year the owner must pay 1% per year to keep it vacant. All REITS would have to lower rents and actually rent, right now there are huge numbers if vacant apartments in rent protection zones.

Such a scheme costs very little and would not impact people who've saved for a holiday home.

Even with a 1% vacancy charge as long as the annual house price is greater than 1% then they'll book that vacant property as an appreciating asset.

McWilliams piece from last weekend reminded me of standing in an empty fully finished estate in 2006 which was being withheld from the market while the credit was flowing. The result of course was us ending with with a surplus of housing, but in many places where there was little employment beyond building houses.

On this swing it's the international pension funds driving the frenzy, but as we've seen Marlot are now having to find buyers where previously their developments were being bought unfinished. We are probably going to end up with a surplus of shoebox apartment developments designed expressly for maximizing developer return.

Marius34 · 02-04-2021 10:36AM

mcsean2163 wrote: »

Bridging loan has been a big headache for us so sounds like a great idea.

For me, the most obvious solution is vacant property charge on third house for private individuals and all property for business institutions.

If a property is vacant for over a year the owner must pay 1% per year to keep it vacant. All REITS would have to lower rents and actually rent, right now there are huge numbers if vacant apartments in rent protection zones.

Such a scheme costs very little and would not impact people who've saved for a holiday home.

I don't think those numbers are huge, if it's only around 1000, it wouldn't make much difference, and from August/September those numbers likely to go down fast even without vacancy charge.

PropQueries · 02-04-2021 10:38AM

The Irish Times have published their view on Biden’s tax reforms. Their last paragraph is telling IMO:

“Investment in future will locate where the best workforce can be found – and where the best education, research and innovation infrastructures are evident. Building these areas is the challenge for the future.”

Can anyone really state with a straight face that we tick all these three boxes in relation to other countries at the moment? Especially when most of their R&D is already done in other countries i.e. the evidence is that the multinationals, in the main, don’t believe we tick any of these boxes at the moment.

Of course, it all depends on the end agreement, but demand for housing in Ireland is highly linked to continued FDI (and their jobs) into Ireland and multinationals will be making their future FDI decisions from now on with this in mind IMO

Will existing housing developers need to go back to the drawing board on the type of houses they will build once they’re allowed back building this year? Luxury may be out and affordable and actual very low cost housing units may be in IMO

Link to Irish Times viewpoint article here: https://www.irishtimes.com/opinion/editorial/the-irish-times-view-on-corporate-tax-the-ripple-effects-of-us-policy-shifts-1.4526391

02-04-2021 11:32AM

PropQueries wrote: »

The Irish Times have published their view on Biden’s tax reforms. Their last paragraph is telling IMO:

“Investment in future will locate where the best workforce can be found – and where the best education, research and innovation infrastructures are evident. Building these areas is the challenge for the future.”

Can anyone really state with a straight face that we tick all these three boxes in relation to other countries at the moment? Especially when most of their R&D is already done in other countries i.e. the evidence is that the multinationals, in the main, don’t believe we tick any of these boxes at the moment.

Of course, it all depends on the end agreement, but demand for housing in Ireland is highly linked to continued FDI (and their jobs) into Ireland and multinationals will be making their future FDI decisions from now on with this in mind IMO

Will existing housing developers need to go back to the drawing board on the type of houses they will build once they’re allowed back building this year? Luxury may be out and affordable and actual very low cost housing units may be in IMO

Link to Irish Times viewpoint article here: https://www.irishtimes.com/opinion/editorial/the-irish-times-view-on-corporate-tax-the-ripple-effects-of-us-policy-shifts-1.4526391

I believe that we do tick the education and research boxes. It’s the infrastructure box that we do not.....whether that’s innovation infrastructure, housing, broadband etc.

thefridge2006 · 02-04-2021 11:45AM

Deleted User wrote: »

Yeah, those incoming credits probably stood out

Woody by name, woody by nature

timmyntc · 02-04-2021 11:48AM

Deleted User wrote: »

I believe that we do tick the education and research boxes. It’s the infrastructure box that we do not.....whether that’s innovation infrastructure, housing, broadband etc.

Broadband is Ireland is pretty good to be honest - its one of the things done well.
Transport infrastructure is seriously lacking - public transport in particular.
And housing goes without saying.. housing & transport lead to poorer quality of life for workers and is a big disincentive to move here.

And as for Education, Irish education system is good at teaching you how to learn by rote, but not great at developing skills for critical thinking and innovating that MNCs would be after.
Most of workers in MNCs here are European, not Irish

thefridge2006 · 02-04-2021 12:10PM

Deleted User wrote: »

Today property market reminds me pub at 5AM were is about 20 drunk guys fighting for 1 bottle of whiskey left on shelve.

Actually this is the best type of analogy I've heard.....you can add a few more things too

Added to that is the beer goggles....... The people at the bar haven't have sex in a long time and will literally settle for anything with a heartbeat and take them home.....

Wake up the next day with a really bad hang over and a lot of regret...

thefridge2006 · 02-04-2021 12:21PM

PropQueries wrote: »

The Irish Times have published their view on Biden’s tax reforms. Their last paragraph is telling IMO:

“Investment in future will locate where the best workforce can be found – and where the best education, research and innovation infrastructures are evident. Building these areas is the challenge for the future.”

Can anyone really state with a straight face that we tick all these three boxes in relation to other countries at the moment? Especially when most of their R&D is already done in other countries i.e. the evidence is that the multinationals, in the main, don’t believe we tick any of these boxes at the moment.

Of course, it all depends on the end agreement, but demand for housing in Ireland is highly linked to continued FDI (and their jobs) into Ireland and multinationals will be making their future FDI decisions from now on with this in mind IMO

Will existing housing developers need to go back to the drawing board on the type of houses they will build once they’re allowed back building this year? Luxury may be out and affordable and actual very low cost housing units may be in IMO

Link to Irish Times viewpoint article here: https://www.irishtimes.com/opinion/editorial/the-irish-times-view-on-corporate-tax-the-ripple-effects-of-us-policy-shifts-1.4526391

Also if MNC's expand elsewhere ( don't necessarily have to fully leave Ireland) surely they will be pulling some of the non- native workers etc to the new countries. You could see the outbound numbers grow and reduced demand/ more supply

awec · 02-04-2021 12:23PM

PropQueries wrote: »

The Irish Times have published their view on Biden’s tax reforms. Their last paragraph is telling IMO:

“Investment in future will locate where the best workforce can be found – and where the best education, research and innovation infrastructures are evident. Building these areas is the challenge for the future.”

Can anyone really state with a straight face that we tick all these three boxes in relation to other countries at the moment? Especially when most of their R&D is already done in other countries i.e. the evidence is that the multinationals, in the main, don’t believe we tick any of these boxes at the moment.

Of course, it all depends on the end agreement, but demand for housing in Ireland is highly linked to continued FDI (and their jobs) into Ireland and multinationals will be making their future FDI decisions from now on with this in mind IMO

Will existing housing developers need to go back to the drawing board on the type of houses they will build once they’re allowed back building this year? Luxury may be out and affordable and actual very low cost housing units may be in IMO

Link to Irish Times viewpoint article here: https://www.irishtimes.com/opinion/editorial/the-irish-times-view-on-corporate-tax-the-ripple-effects-of-us-policy-shifts-1.4526391

That one was yesterday, they actually have a good article today providing a good, balanced overview of the situation, highlighting areas of concern and also the lack of need to panic.

I'm guessing you must have missed this one?

https://www.irishtimes.com/business/economy/us-congress-will-determine-impact-of-biden-tax-plan-on-ireland-experts-say-1.4526762

"“The phone lines to Washington, DC, will be hopping as Ireland tries to mitigate the worst changes,” according to Mr O’Rourke. “The proposal is concerning and we will need to be actively involved in lobbying US lawmakers, but there is no need for panic at this point,” he said. Had it happened 20 years ago it may have had a big impact on the State’s efforts to attract FDI, he said, but today the Republic’s attractiveness for FDI is wider than tax."

awec · 02-04-2021 12:33PM

Another good IT article today.

https://www.irishtimes.com/business/commercial-property/office-demand-rebounds-as-employers-place-faith-in-vaccine-rollout-1.4520993

"Office demand rebounds as employers place faith in vaccine rollout"

Some interesting quotes:

"Active demand in March 2021 is being tracked at 3.3 million sq ft split across a total of 164 requirements. To put this active demand into context, the long-run average annual take-up is 2.2 million sq ft, making the existing active demand the equivalent of 1½ years of average annual take-up."

"Developers have also noted this shift in sentiment from last year and again, perhaps unexpectedly, have in at least three instances appointed contractors to begin work on speculative office schemes in the city centre to provide more than 500,000sq ft of offices."

"Some technology companies with offices in Dublin appear to be not only “pandemic-proof” in terms of their respective business models, but are ideally positioned to grow during a lockdown."

"Companies such as Wix, 2K games, TikTok, Udemy, Amazon, Workday, Huawei and Stripe have all expanded their headcounts or have announced new jobs over the last 12 months. In all of the above examples, the growth in headcount in 2020 has translated into active demand for office space in 2021."

"This trend is evidenced in the most recent figures from the Central Statistics Office which show that in the final quarter of 2020, the tech sector recorded an annual increase in employment figures of 9 per cent in Ireland. "

"However, a reduction in staff in the office on a day-to-day basis does not necessarily correlate with a reduction in the amount of space occupiers will need. This is due to a 5 per cent increase in office-based work projected over the next five years, the noted trend of increasing occupational ratios and potentially longer-term social distancing requirements in offices."

"We have seen a noticeable increase in demand from staff to have at least some access to an office environment, as evidenced by the growth in traffic volumes during the third lockdown compared to lockdown one. "

Now elements of this are certainly a bit fluffy, but I find it interesting as we've all been told that these things could not possibly happen.

awec · 02-04-2021 12:34PM

And more news, again this is stuff we were told was absolutely never going to happen.

https://www.seattletimes.com/business/amazon/amazon-expects-employees-back-in-their-offices-by-autumn/

Unlike many of its tech-sector peers, Amazon is eschewing a hybrid workplace.

The Seattle-based commerce giant told employees in a companywide announcement that it is planning a “return to an office-centric culture as our baseline.” The transition away from remote work is expected to wrap up by autumn, according to the announcement Tuesday. Working in offices, the note said, “enables us to invent, collaborate, and learn together most effectively.”

"Google announced Wednesday that its employees will begin trickling back to offices in April. The company, which employs nearly 6,000 Seattle-area workers, has said it will pilot a hybrid workplace model in which employees are expected to be in the office three days a week starting in September."

Hubertj · 02-04-2021 12:35PM

awec wrote: »

That one was yesterday, they actually have a good article today providing a good, balanced overview of the situation, highlighting areas of concern and also the lack of need to panic.

I'm guessing you must have missed this one?

https://www.irishtimes.com/business/economy/us-congress-will-determine-impact-of-biden-tax-plan-on-ireland-experts-say-1.4526762

"“The phone lines to Washington, DC, will be hopping as Ireland tries to mitigate the worst changes,” according to Mr O’Rourke. “The proposal is concerning and we will need to be actively involved in lobbying US lawmakers, but there is no need for panic at this point,” he said. Had it happened 20 years ago it may have had a big impact on the State’s efforts to attract FDI, he said, but today the Republic’s attractiveness for FDI is wider than tax."

That article probably doesn’t suit the narrative of some.

Pussyhands · 02-04-2021 12:38PM

For some roles it needs to be office but many roles don't and I think we'll see a mixture in future.

Marius34 · 02-04-2021 01:05PM

Hubertj wrote: »

That article probably doesn’t suit the narrative of some.

And I can prove, that for most in this thread is not important what happening, or what's about to happen in Property Market, or how well you can predict current Property Market, but rather on what side you stand, and what we want to hear:

And this was only 6 month ago.

PropQueries · 02-04-2021 01:10PM

awec wrote: »

And more news, again this is stuff we were told was absolutely never going to happen.

https://www.seattletimes.com/business/amazon/amazon-expects-employees-back-in-their-offices-by-autumn/

Unlike many of its tech-sector peers, Amazon is eschewing a hybrid workplace.

The Seattle-based commerce giant told employees in a companywide announcement that it is planning a “return to an office-centric culture as our baseline.” The transition away from remote work is expected to wrap up by autumn, according to the announcement Tuesday. Working in offices, the note said, “enables us to invent, collaborate, and learn together most effectively.”

"Google announced Wednesday that its employees will begin trickling back to offices in April. The company, which employs nearly 6,000 Seattle-area workers, has said it will pilot a hybrid workplace model in which employees are expected to be in the office three days a week starting in September."

Have I not been consistent that it will by either full time in the office or full time WFH? I've also said that I believe they will "test" ("pilot") the hybrid model to placate some staff and to show their employees that at least they tried it before choosing one or the other

Either way, all it takes is 8,000 workers in the city to embrace full time WFH and that's the equivalent of Google moving out. Between the civil service and other companies, that's a minimum that will not be returning to the city IMO.

Then you can throw in all the workers in restaurants, pubs, retail etc. who will also not be returning to work in the city centre due to the permanent decline in footfall and that's the rental demand for all those flats, apartments and houses rented by the room etc. effectively wiped out, hybrid or no hybrid IMO

treenytru · 02-04-2021 01:38PM

schmittel wrote: »

No doubt that to encourage downsizing in significant numbers new developments would be helpful, but why not start off with the bridging loans immediately?

I am not buying the idea that people cannot downsize because the properties they need to downsize to have not been built yet. They have been built, it's just that the entire market is clogged up in a giant negative feedback loop.

Introducing the finance to will turn that loop on its head. Early adopter downsizers will generate a positive feedback loop.

Plenty of empty nesters living in big family homes would be very happy to move to some of the newer apartments. Plenty of young couples in the newer apartments would be happy to move to the big family homes.

Both types of property currently exist, they are just occupied by the wrong people. This is what we need to change.

It could be started almost immediately and it would take very little to get that ball rolling.

https://www.pressreader.com/ireland/irish-independent/20190405/283089890519945

Government trailed a scheme centred around this idea back in 2018 - only issue is the 'pilot' scheme included only 1 participant.

The scheme provided funding for the pensioner to turn her family home into 2 apartments - she lives downstairs (so no dangerous stairs to navigate in old age) and rents out top floor - cost to convert was 62K. the pensioner then enjoys up to 14k a yr in tax free rent (which IMO should be used in the first few years to pay off the loan for conversion).

Once of the biggest obstacles to downsizing is that naturally people don't want to leave the area or home they've spend their whole lives in - this way they don't have to

Really surprised the current government haven't made more out of this idea.

hometruths · 02-04-2021 02:01PM

Marius34 wrote: »

And I can prove, that for most in this thread is not important what happening, or what's about to happen in Property Market, or how well you can predict current Property Market, but rather on what side you stand, and what we want to hear:

And this was only 6 month ago.

In the post you quoted I did not make any predictions about what's about to happen in the market.

My point was the time to rubbish his predictions would be at the end of Q1 2021.

Well done you, we're at the end of Q1 2021, and he was wrong. The time has now arrived to rubbish his predictions.

But if you're suggesting I was wrong to say it was a bit early to rubbish them 6 months ago, I think you're missing the point. As usual.

Marius34 · 02-04-2021 02:24PM

schmittel wrote: »

In the post you quoted I did not make any predictions about what's about to happen in the market.

My point was the time to rubbish his predictions would be at the end of Q1 2021.

Well done you, we're at the end of Q1 2021, and he was wrong. The time has now arrived to rubbish his predictions.

But if you're suggesting I was wrong to say it was a bit early to rubbish them 6 months ago, I think you're missing the point. As usual.

I didn't want to point specifically to you this time, it was about most people disagreeing with my different unpopular view, and rather following crazy forecast of crash.
It's not just about Q1 2021, but more what Estate Agent said, it's safe to assume that prices are already 10% down, to be reflected in Q4 2020 figures, which was a nonsense, as we can see now.

mcsean2163 · 02-04-2021 02:25PM

[Deleted User] wrote: »

I believe that we do tick the education and research boxes. It’s the infrastructure box that we do not.....whether that’s innovation infrastructure, housing, broadband etc.

UK have two universities in highest global rank.

Trinity is 155th.

02-04-2021 07:47PM

awec wrote: »

And more news, again this is stuff we were told was absolutely never going to happen.

https://www.seattletimes.com/business/amazon/amazon-expects-employees-back-in-their-offices-by-autumn/

Unlike many of its tech-sector peers, Amazon is eschewing a hybrid workplace.

The Seattle-based commerce giant told employees in a companywide announcement that it is planning a “return to an office-centric culture as our baseline.” The transition away from remote work is expected to wrap up by autumn, according to the announcement Tuesday. Working in offices, the note said, “enables us to invent, collaborate, and learn together most effectively.”

"Google announced Wednesday that its employees will begin trickling back to offices in April. The company, which employs nearly 6,000 Seattle-area workers, has said it will pilot a hybrid workplace model in which employees are expected to be in the office three days a week starting in September."

Life with cover masks in Asia is as standard but they all work in offices.Remote working from home in Europe was the fantasy from very first day.

02-04-2021 08:11PM

[Deleted User] wrote: »

Life with cover masks in Asia is as standard but they all work in offices.Remote working from home in Europe was the fantasy from very first day.

Many that work for MNCs here have been working from home a couple of days a week for years. When so many of the people with whom we all interact are in the US, India and other places, then it makes relatively little difference. That is the nature of many MNCs here in Ireland

We’ve all been officially told that none of us have to return if we don’t want to after this - globally, including the big NYC and Mumbai hubs. And the new office strategy is based on 60% occupancy. Given that some will want to be back 100% of the time (especially younger people in shared accommodation) it then follows that others will not go in at all. Most want (and will get) 2 - 3 days in the office

02-04-2021 09:44PM

Deleted User wrote: »

Many that work for MNCs here have been working from home a couple of days a week for years. When so many of the people with whom we all interact are in the US, India and other places, then it makes relatively little difference. That is the nature of many MNCs here in Ireland

We’ve all been officially told that none of us have to return if we don’t want to after this - globally, including the big NYC and Mumbai hubs. And the new office strategy is based on 60% occupancy. Given that some will want to be back 100% of the time (especially younger people in shared accommodation) it then follows that others will not go in at all. Most want (and will get) 2 - 3 days in the office

We will lose more jobs in offices due with tax regime change in world than due with Covid.

TheSheriff · 02-04-2021 10:11PM

PropQueries wrote: »

Have I not been consistent that it will by either full time in the office or full time WFH? I've also said that I believe they will "test" ("pilot") the hybrid model to placate some staff and to show their employees that at least they tried it before choosing one or the other

Either way, all it takes is 8,000 workers in the city to embrace full time WFH and that's the equivalent of Google moving out. Between the civil service and other companies, that's a minimum that will not be returning to the city IMO.

Then you can throw in all the workers in restaurants, pubs, retail etc. who will also not be returning to work in the city centre due to the permanent decline in footfall and that's the rental demand for all those flats, apartments and houses rented by the room etc. effectively wiped out, hybrid or no hybrid IMO

There is no shame in just saying you were wrong.

Pussyhands · 02-04-2021 10:45PM

I'm seeing that crazyhouseprices instagram page spammed everywhere.

Gave it a like but noticed he's got a patreon set up. Some chancers out there!

RichardAnd · 02-04-2021 11:56PM

Hi everyone,

I've been a lurker on this thread for many a month; it's informative and entertaining at the same time.

I've been digging around for information on the status of "virtual viewings". Does anyone know whether physical viewings are to return soon? I'm guessing that they are not, as I've found no information to suggest otherwise.

Thanks.

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

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2021 Irish Property Market chat - mod warnings post 1