2021 Irish Property Market chat - mod warnings post 1

Ozark707 · 12-05-2021 11:49AM

PommieBast wrote: »

Does anyone have any stats for all those Spencer Dock developments? Walking through the place it feels like a serious glut..

Well at the prices they are looking for it will remain empty. I think at one stage they were offering 2 months free instead of just dropping the price. I haven't been through it in a long time but it would appear that there are hundreds of apartments to come on stream (I guess in next 12-18 months?).

JimmyVik · 12-05-2021 11:50AM

PommieBast wrote: »

We are still at Level-5 and the North Quays were already gridlocked at 8am today, so I dread to imagine what it would be like with "normal" traffic. A lot of people are simply not going to tolerate going back to the 10-times-a-week ordeal, especially since the traffic changes will make it worse for most.

Coincidentally I signed my notice letter today for this very reason.

I had the miserable experience of driving into the city center a couple of weeks ago.
So many lanes for cars are just gone in the last year.
Taken over bikes and staying like that.
Traffic is going to be pure carnage when the city starts up again.

jill_valentine · 12-05-2021 11:56AM

PommieBast wrote: »

Does anyone have any stats for all those Spencer Dock developments? Walking through the place it feels like a serious glut..

This is a question I'm getting obsessed with tbh. There's so little else to do at the minute I've been doing a lot of walking or biking around the city, and you can see it at night, especially when the weather is bad and nobody else is out and about to give it any life. There are so many high end apartments obviously not in use I'm in danger of getting awful boring about it.

I understand the mechanisms that make that make sense and to keep building them anyway, and I understand it's not about to affect the wider market anytime soon, but the curiosity kills me just how great the extent is. There, Grand Canal Dock, and back around Heuston Station, the three big flashy flat zones where nobody's actually home.

JimmyVik · 12-05-2021 11:59AM

jill_valentine wrote: »

This is a question I'm getting obsessed with tbh. There's so little else to do at the minute I've been doing a lot of walking or biking around the city, and you can see it at night, especially when the weather is bad and nobody else is out and about to give it any life. There are so many high end apartments obviously not in use I'm in danger of getting awful boring about it.

I understand the mechanisms that make that make sense and to keep building them anyway, and I understand it's not about to affect the wider market anytime soon, but the curiosity kills me just how great the extent is. There, Grand Canal Dock, and back around Heuston Station, the three big flashy flat zones where nobody's actually home.

Try walking around Canary Wharf in London in the evenings. Its deserted.

jill_valentine · 12-05-2021 12:03PM

JimmyVik wrote: »

Try walking around Canary Wharf in London in the evenings. Its deserted.

It's funny you say that, it has a real feel of London urban desert. I've a real morbid fascination about both, in a Life After People sort of way.

I suppose the difference is I tend to just assume Canary Wharf buildings are largely office or commercial, whereas around Spencer Dock etc you can just look up to the balconies and see for yourself that they're apartments and nobody's in them.

Amadan Dubh · 12-05-2021 12:04PM

jill_valentine wrote: »

This is a question I'm getting obsessed with tbh. There's so little else to do at the minute I've been doing a lot of walking or biking around the city, and you can see it at night, especially when the weather is bad and nobody else is out and about to give it any life. There are so many high end apartments obviously not in use I'm in danger of getting awful boring about it.

I understand the mechanisms that make that make sense and to keep building them anyway, and I understand it's not about to affect the wider market anytime soon, but the curiosity kills me just how great the extent is. There, Grand Canal Dock, and back around Heuston Station, the three big flashy flat zones where nobody's actually home.

The big question is how, in a housing crisis, can properties be left vacant rather than dropping rents until they are let?

The data on the state of the market indicates rents have decreased slightly over the last year in Dublin but are potentially starting to increase again in Dublin. However, due to the level of vacancies, it is quite obvious that the Daft report is not a complete picture of the state of the market. Do we potentially already have our ghost estates from the economic growth period from 2012?

c.p.w.g.w · 12-05-2021 12:05PM

timmyntc wrote: »

Some dont even have stairs - worked in a shop once where there was just a stira type ladder going from ground floor up to 1st floor.
And 2nd floor was just a regular ladder

As central as you could get, could easily be turned into a 2bed apartment too if it had proper access (& stairs)

A number of Units on grafton street are like that... one in particular with 4 stories, retail using ground floor and 3 floors of storage and poorly but only 1 entrance through the shop floor

Ozark707 · 12-05-2021 12:08PM

jill_valentine wrote: »

This is a question I'm getting obsessed with tbh. There's so little else to do at the minute I've been doing a lot of walking or biking around the city, and you can see it at night, especially when the weather is bad and nobody else is out and about to give it any life. There are so many high end apartments obviously not in use I'm in danger of getting awful boring about it.

I understand the mechanisms that make that make sense and to keep building them anyway, and I understand it's not about to affect the wider market anytime soon, but the curiosity kills me just how great the extent is. There, Grand Canal Dock, and back around Heuston Station, the three big flashy flat zones where nobody's actually home.

It will be interesting to see what it is like come September/October as it looks like many who will be back in the office will be back by then (if they are to come back as before). If they are still mainly empty around that time it will show that the private rental market won't bear the asking prices. Question is in that scenario will they continue to keep them empty or drop prices.

Villa05 · 12-05-2021 12:09PM

Bass Reeves wrote:

While prices may fall a little if prices fall too much then building will cease unless costs fall substandically. From 2013-2017 Construction struggled as price achieved at sale was below build price. This is still what prevent a lot of development outside of main urban centers.

I'm thinking that if we make better use of what pre exists thus increasing supply and reducing price, would this not flush out the land hoarders, much of that land was purchased at serious discount and if the market moves on to circumvent hoarders, it will force them to use it

yagan · 12-05-2021 12:09PM

So much of this is what I call financial facadism, the creation of assets purely on the basis of expected income streams.

Many pension funds are now underfunded, that is they used payees contributions to fund these rental assets for their projected long term yield.

It's hard to know when the facade will crumble, but the empties were obvious to anyone with eyes for years before Lehman brothers collapsed.

jill_valentine · 12-05-2021 12:16PM

yagan wrote: »

So much of this is what I call financial facadism, the creation of assets purely on the basis of expected income streams.

Many pension funds are now underfunded, that is they used payees contributions to fund these rental assets for their projected long term yield.

It's hard to know when the facade will crumble, but the empties were obvious to anyone with eyes for years before Lehman brothers collapsed.

If I remember rightly, before the housing market collapse in the US, some of them were able to see the canary in the coal mine by just knocking on doors and having nobody answer. Harder to do that with apartments, obviously, but I'd nearly be bored enough to take photos some ****e night and count myself.

Again, it's a select sliver of the housing market so I'm not banking on it to suddenly collapse and we'll all get four free apartments each from the wreckage. But it's fascinatingly weird to look up at a huge building and only see a unit here or there lighting up, when there's essentially nowhere to be but home, and then cycle past pop up tents on Dame Street.

A feature of any big city any time I'm sure, but like I say I have a morbid fascination for it.

PommieBast · 12-05-2021 12:32PM

Ozark707 wrote: »

If they are still mainly empty around that time it will show that the private rental market won't bear the asking prices. Question is in that scenario will they continue to keep them empty or drop prices.

As long as asset valuation does not take account of actual occupation rate they will remain empty.

hmmm · 12-05-2021 12:32PM

https://www.echo.ie/news/article/councillors-vote-unanimously-against-cookstown-castle-plans

Councilors vote unanimously to oppose a scheme with over 1,000 apartments.

I know nothing is perfect, but it seems to me councilors go out of their way to find reasons to object to things. The article quotes several reasons for objecting, including it being apartments and not for families (single people and couples need somewhere to live too), it not all being social housing (do we really want to go back to large social estates?), all for rent (not everyone wants to buy), putting pressure on the LUAS and Dublin bus (where else are we going to build?), and near the flight path to Baldonnel (ffs).

Hubertj · 12-05-2021 12:33PM

Villa05 wrote: »

I'm thinking that if we make better use of what pre exists thus increasing supply and reducing price, would this not flush out the land hoarders, much of that land was purchased at serious discount and if the market moves on to circumvent hoarders, it will force them to use it

When talking about land hoarders you also have to consider capacity to build. Developers could have sites ready to go but don’t have the resources available to build. Or the resources they have are working on other sites.

Any vacancy tax/levy will need to make allowances for that. Otherwise, you could have a situation where the site gets taxed but it is physically not possible to start building. Even if the tax persuades the developer/owner to sell will the next owner have the resources available to start?

This needs to be separated from land being held solely for speculation.

jill_valentine · 12-05-2021 12:42PM

Ozark707 wrote: »

It will be interesting to see what it is like come September/October as it looks like many who will be back in the office will be back by then (if they are to come back as before). If they are still mainly empty around that time it will show that the private rental market won't bear the asking prices. Question is in that scenario will they continue to keep them empty or drop prices.

I wonder if the value of those units as an asset (or at least the increase in their value) will have been affected by lockdown long term, purely because it has made it obvious how many are unoccupied, and given the game away. We're far from the first to notice, you hear people talk about all the dark apartments visible when they meet up around Grand Canal Dock on nice evenings. There was even a (slightly tenderfooted) article about it in the IT a few months ago.

Even if they're only intended as safety deposit boxes for money, doesn't their value have some relationship to whether there's any percieved demand from would-be tenants?

Villa05 · 12-05-2021 12:45PM

Interesting stats from the latest CSO report for march

Number FTB falling down 2.5%
77% of FTB purchases were for 2nd hand properties
Median price in Dublin approaching 400k

Looks like the investment funds have pushed FTB out of the new builds market.
We are starting to see why FF wanted shared ownership despite all the advise against

JimmyVik · 12-05-2021 12:47PM

jill_valentine wrote: »

It's funny you say that, it has a real feel of London urban desert. I've a real morbid fascination about both, in a Life After People sort of way.

I suppose the difference is I tend to just assume Canary Wharf buildings are largely office or commercial, whereas around Spencer Dock etc you can just look up to the balconies and see for yourself that they're apartments and nobody's in them.

No plenty of residential building in canary wharf.
I was staying in one for about a month and thought it was something like 28 days later in the evening. Only the skateboarders would be seen for a while and eventually they go home and its totally deserted..

Bass Reeves · 12-05-2021 12:49PM

Geuze wrote: »

The current VSL is 7%.

https://www.citizensinformation.ie/en/environment/buildings_and_structures/vacant_sites.html

I don't think it has been very effective at releasing sites.

Maybe it should be higher?

It virtually impossible to collect as it's too high. On any vacant site there is a 2-3 year development lead in. This is down to design, planning and getting to busing stage. If a builder/developer are going through this process the levy is not collectables. There is only 1*2 attempts to collect it mainly against farmers who's lands were zoned with out there involvment in the process. They continued to farm it and some council official taught they could enforce the collection. AFAIK virtually nothing has been collected from it.......and I guess never will.

A tax has to be collectable. Set the rate at 1% and collect it rebate last 5 years when site is build on

TrangiaCoffee · 12-05-2021 12:50PM

What a good decision by FF increasing stamp duty for everyone to deter cuckoo funds. Could have made the decision earlier but better late than never.

awec · 12-05-2021 12:56PM

Villa05 wrote: »

Interesting stats from the latest CSO report for march

Number FTB falling down 2.5%
77% of FTB purchases were for 2nd hand properties
Median price in Dublin approaching 400k

Looks like the investment funds have pushed FTB out of the new builds market.
We are starting to see why FF wanted shared ownership despite all the advise against

How many new builds were sold in march?

Browney7 · 12-05-2021 12:59PM

Amadan Dubh wrote: »

The big question is how, in a housing crisis, can properties be left vacant rather than dropping rents until they are let?

The data on the state of the market indicates rents have decreased slightly over the last year in Dublin but are potentially starting to increase again in Dublin. However, due to the level of vacancies, it is quite obvious that the Daft report is not a complete picture of the state of the market. Do we potentially already have our ghost estates from the economic growth period from 2012?

Yes the daft report seems to use number of ads on the platform as opposed to properties but it needs clarification for sure.

Amadan Dubh · 12-05-2021 01:05PM

Browney7 wrote: »

Yes the daft report seems to use number of ads on the platform as opposed to properties but it needs clarification for sure.

There's nothing wrong with it but it's just important to remember it is only a snapshot of a segment of the market.

fago · 12-05-2021 01:08PM

Villa05 wrote: »

Interesting stats from the latest CSO report for march

Number FTB falling down 2.5%
77% of FTB purchases were for 2nd hand properties
Median price in Dublin approaching 400k

Looks like the investment funds have pushed FTB out of the new builds market.
We are starting to see why FF wanted shared ownership despite all the advise against

2nd hand YoY growth swung by 3%, new by .4%

In one quarter second hand growth has caught up and passed new.

Would the theory be, a combination of the lack of new supply, and the price of new supply edging up making 2nd hand more attractive again?

Villa05 · 12-05-2021 01:15PM

awec wrote:

How many new builds were sold in march?

Quick calculation 600

yagan · 12-05-2021 01:26PM

jill_valentine wrote: »

If I remember rightly, before the housing market collapse in the US, some of them were able to see the canary in the coal mine by just knocking on doors and having nobody answer. Harder to do that with apartments, obviously, but I'd nearly be bored enough to take photos some ****e night and count myself.

They went even further in the US in writing mortgage contracts for dead people and selling them onto banks.

Here our Taoiseach at the time said people who warned about the impending property crash were cribbers and moaners and didn't understand why such people didn't kill themselves listening to their own words.

As someone else mentioned earlier these pension funds have been buying tranches of Dublin apartments for years, but it's only when they bought houses did the general public get triggered.

If the government are going to ignore the empties now they did in Berties time my only question is what will trigger the pullback by international pension funds?

jill_valentine · 12-05-2021 01:37PM

yagan wrote: »

They went even further in the US in writing mortgage contracts for dead people and selling them onto banks.

Here our Taoiseach at the time said people who warned about the impending property crash were cribbers and moaners and didn't understand why such people didn't kill themselves listening to their own words.

As someone else mentioned earlier these pension funds have been buying tranches of Dublin apartments for years, but it's only when they bought houses did the general public get triggered.

If the government are going to ignore the empties now they did in Berties time my only question is what will trigger the pullback by international pension funds?

Is there a way to know if these funds are buying more "traditional" houses in the last year than they might do otherwise, vs apartments? I know it feels like that, but are there statistics we could compare?

If so, I'd think that would mean that either a) the funds see writing on the wall for the empty showroom apartment market and they're trying to get a ahead of any unfortunate events by branching out or b) they're approaching a practical ceiling in what they can build or buy for the apartment market. I have to think houses out of town are quite a bit riskier and involve a lot more ongoing attention.

MacronvFrugals · 12-05-2021 01:40PM

Its a paywall article but interesting to note the IMF are recommending we increase taxes

The IMF’s point man on Ireland on increasing taxes, fixing the housing crisis and helping SMEs survive the pandemic

https://t.co/P3HggrjrRH?amp=1

Browney7 · 12-05-2021 01:40PM

Amadan Dubh wrote: »

There's nothing wrong with it but it's just important to remember it is only a snapshot of a segment of the market.

While it's useful for the trends for sure, Lyons made the conclusion you need 4000 properties for rent at a time for rents to fall/stay stable. We may be at that number despite the number of ads being below it for example.

Amadan Dubh · 12-05-2021 01:43PM

yagan wrote: »

They went even further in the US in writing mortgage contracts for dead people and selling them onto banks.

Here our Taoiseach at the time said people who warned about the impending property crash were cribbers and moaners and didn't understand why such people didn't kill themselves listening to their own words.

As someone else mentioned earlier these pension funds have been buying tranches of Dublin apartments for years, but it's only when they bought houses did the general public get triggered.

If the government are going to ignore the empties now they did in Berties time my only question is what will trigger the pullback by international pension funds?

If the government bans the entering into leases for 20/25 years by the councils and the institutionals have to try to draw €2k+ blood rents from the income tax payer stone, then I could see the "get rich quick" US investors starting to question the risk versus returns. The pension funds perhaps would just look to hold the asset and achieve some income over the long term.

Bigger picture is as Timing Belt describes.

Browney7 · 12-05-2021 02:04PM

Villa05 wrote: »

Interesting stats from the latest CSO report for march

Number FTB falling down 2.5%
77% of FTB purchases were for 2nd hand properties
Median price in Dublin approaching 400k

Looks like the investment funds have pushed FTB out of the new builds market.
We are starting to see why FF wanted shared ownership despite all the advise against

https://www.cso.ie/en/releasesandpublications/ep/p-rppi/residentialpropertypriceindexmarch2021/

Updated property price index shows a 0.7% increase nationally month on month from Feb to March.

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

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2021 Irish Property Market chat - mod warnings post 1