Irish Property Market chat II - *read mod note post #1 before posting*

genericgoon wrote: »

Based on the table provided of what qualifies as a "property tax" then it would seem the comparison on that site is indeed based on a combination of recurring (e.g. LPT) and non-recurring (e.g. inheritance) taxes. My focus was on recurring taxation which is slightly below average as per the OECD 2020 report on Ireland.

If you increase recurring property taxes, then Ireland's total property tax take will increase and deviate even further from the norm. But why not, many of Ireland's taxes are well above the norm and many don't even exist in other countries.

Go for it. Increase them as much as you like. I'm getting out of property ownership.

derekgine3 wrote: »

David McWilliams stated on his recent podcast the reason why the US saw 4.9% Inflation rate YOY is because the data was tracked April 2020 - April 2021 and in April 2020 many businesses did not foresee long lockdowns and had dropped prices significantly to attract customers after the predicted short lockdown would end in May.

All this QE/printing recently points to inflation but maybe i'm cynical in my old age and don't believe the narrative the MSM are putting out regarding sure thing inflation in the short/medium term. Experience has thought me to never trust the MSM when it comes to economics/housing.

Our old head of the CBI doesn't see inflation in the medium term either. One of the crucial factors in the future of property prices and it's as clear as mud at the minute!

"“There is nearly zero connection between any kinds of spikes under the reopening of the economy and what goes into the inflation trend,” Mr Lane told an online event"

"“When you’re climbing out of a hole, you’re still in a hole,” he said, adding that a rebound does not deliver a sustained recovery."

https://www.irishtimes.com/business/economy/reopening-price-spikes-do-not-mark-new-era-of-inflation-philip-lane-1.4570494

DataDude wrote: »

Our old head of the CBI doesn't see inflation in the medium term either. One of the crucial factors in the future of property prices and it's as clear as mud at the minute!

"“There is nearly zero connection between any kinds of spikes under the reopening of the economy and what goes into the inflation trend,” Mr Lane told an online event"

"“When you’re climbing out of a hole, you’re still in a hole,” he said, adding that a rebound does not deliver a sustained recovery."

https://www.irishtimes.com/business/economy/reopening-price-spikes-do-not-mark-new-era-of-inflation-philip-lane-1.4570494

There probably won't be inflation in the medium term either. The old adage of the more money in the economy the higher risk of spiking inflation has not held true over the past eight years. It's an odd one, but it seems to be true.

Now, that being said, there may be inflationary spikes in certain areas rather than a wholesale rise in prices. Certainly it would seem that there will be a rise in property prices once the vaccination programme comes to an end and life returns somewhat to normal. There's such a huge increase in built up household savings, with a large chunk of those savers saying that they are going to use their new found savings for a house deposit/big purchase. It seems that a spike in prices is inevitable. I see nothing from the government that will prevent this spike.

As for Foxrock I agree with the other posters. From the outside it has literally nothing going for it. Not by the sea. No village to speak of. No amenities and not close to any public transport. What it is is essentially a gated community like you might see in America. I worked with an intern a few years ago who grew up in one of the fancy houses. She said that everyone knows everyone, they all go for dinner parties in each others houses, and the children all go out with each other - in fact are kind of encouraged to do so by the parents. It struck me as sort of a mirror version of a traveller halting site. Too insular for my liking.

yagan wrote: »

It just occurred to me that in all the talk about the property market at the moment I have not heard anyone in the public sphere use the phrase "getting on the property ladder". The housing ministers "help to buy unaffordable homes" isn't being swallowed by the public either.

The happy talk about property never fully recovered from the crash which is a good thing. Young people are getting wise to this game.

Graham wrote: »

'property ladder' wouldn't describe our current approach to homeownership.

What we have is more of a single property step with a semi at the top.

The reason being nobody wants to risk buying an apartment and then moving up the ladder later in life because they might get stung like those who bought in the last boom

I think we approaching the near 300k for 3 beds in Dublin no matter where its located and possibly 190k /200 k for one bed apartments. Wouldnt be long hitting the boom year highs if the increases keep going like this.

JDD wrote: »

There's such a huge increase in built up household savings, with a large chunk of those savers saying that they are going to use their new found savings for a house deposit/big purchase. It seems that a spike in prices is inevitable. I see nothing from the government that will prevent this spike.

See this being mentioned loads but is it not being a bit overblown? Back of the cigarette box calcs. Household deposits up 14%. There was already an upward trend so lets say 10% extra cash on average in peoples pockets due to COVID that they wouldn't have otherwise have.

I would wager that the big winners in all this are higher income people who are more likely to own a home anyway, but ignore that for a second.

Lets assume all prospective home buyers are 10% richer in cash terms than they'd have been without COVID-19. Lets assume the average deposit is 20%. So even if every home buyer ploughed every last cent of their extra cash into a house, you're only talking a 2% rise in the purchase price they can attain. Add in that "people" form only a part of the total transactions in a year (AHB's, LAs, REITs etc). It's a 2% increase in a subset of the market, not even the whole market.

Ok, perhaps you pull a few FTBers who wouldn't have been ready just yet forward and they can attain leverage they wouldn't have otherwise been able to. But that's just moving a small bit of demand forward a bit by a few months, will wash itself out quickly enough and doesn't add to aggregate demand over a longer period. It just creates a slight artificial hump in demand which will be followed by an equal and opposite artificial dip at some point in the future

JDD wrote: »

As for Foxrock I agree with the other posters. From the outside it has literally nothing going for it. Not by the sea. No village to speak of. No amenities and not close to any public transport. What it is is essentially a gated community like you might see in America. I worked with an intern a few years ago who grew up in one of the fancy houses. She said that everyone knows everyone, they all go for dinner parties in each others houses, and the children all go out with each other - in fact are kind of encouraged to do so by the parents. It struck me as sort of a mirror version of a traveller halting site. Too insular for my liking.

using this analogy anytime I speak to someone from Foxrock going forward.

timmyntc wrote: »

It's hardly the fault of would-be buyers that things are the way they are?

The lack of suitable apartments for raising a family is one problem here - if you want to raise a family in this country you NEED a house, current apartments dont cut it.
And the boom-bust nature of our housing market (that everyone can see) leaves most people afraid to buy an apartment and buy in to the idea of the "ladder" because they've all seen how badly people who bought pre-08 got stung. Can't blame them for having the sense not to engage in the madness.

Apartments work in other countries. Visit any major city outside Ireland/UK and its all surrounded by apartments. Good infastructure in place, ie easy to get to work Via public transport.

Why don't they built proper apartments here near major city's instead of houses.

derekgine3 wrote:

All this QE/printing recently points to inflation but maybe i'm cynical in my old age and don't believe the narrative the MSM are putting out regarding sure thing inflation in the short/medium term. Experience has thought me to never trust the MSM when it comes to economics/housing.

There was a story last week there was a shortage of flakes for 99 ice creams
Low and behold on the same day what showed up on my bargain alerts only boxes of flakes at huge discount on amazon delivered to my door for free

Maybe Borris bought them in to ensre the Brits don't run out or perhaps the weather

Beware of the media

JimmyVik wrote: »

I have a new prediction.
Intergenerational mortgages mortgages to be a thing in the next 5 years.

Didn't happen during the boom. Won't happen now..

handlemaster wrote: »

Give it time. Dont get to excited prices will dip. Always do.

Could you post a graph showing these dips?