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

As wages increase in the tech sector they will be on a London wage and be able to pay a London rent especially when they have no other choice due to low supply of rental properties.

Covid did not drive energy through the roof, a ludicrous faith and over investment in utterly unreiable wind energy caused this. Europe added heaps of new wind infrastructure in the summer and so didn't think much gas would be required in the winter because Nordstream 2 would open and the wind would be howling. Putin moved over 100k troops to threaten Ukraine and made opening Nordstream an issue and the wind didn't blow this winter. Add to that the utter stupidity of shuttering zero CO2 nuclear plants in mid winter, and the Germans have screwed over Europe big time. The French are usuallly handy with supplying the rest of Europe with surplus cheap zero CO2 nuclear power, but they have had to cut back for some unscheduled repairs after some cracks were found after 20 years of reliable operation.

Simple supply and demand. The demand for gas went up, and was unforseen, while supply was constrained.

As for Ireland's great energy policy:

Wind producing less than 1% of the nations needs at 6pm.

I would love to buy pharmaceuticals from the UK, or Europe, where they are 80% cheaper, but the Irish government has taken one of those stupid special case loop holes in the supposedly common market and used it to deny Irish people access to cheaper markets. Protectionism wasn't supposed to be a core feature of the 'common' market, but Ireland manage it with cars, pharmaceuticals, fuels, and alcohol. If houses were transportable, they would find a way to close that off too.

The stitch up with pharmaceuticals is just unconscionable. Irish people have the worst and least access to low priced generic drugs in the EU or OECD, and it's deliberate.

I did just get 3.5Kg of coffee from Germany, so at least there are a couple of holes the Irish government hasn't managed to plug, like with that wonderful VRT import duty stand-in.

Yeah sure. I must remember that when I spending most of my money on rent

No what it means is energy prices fell during COVID this hid inflation last year and the year before. Now we are seeing energy prices not only recorrect but catch up with the three years they missed out on. That process will not be repeated we hope

No.... What I am saying is that the price increase in the CPI is measured by comparing todays price to the price last year.

For the period Feb-2020 to Feb-2021 the price of oil was low because of covid and when you compare todays price to a year before it leads to an larger % increase which is what is used in the CPI Calculation. This Base effect will fall away from Feb 2022 onwards which will result in a lower % increase in energy prices in the CPI because they will be comparing the price rise to the price that is closer to the long term average of Energy.

e.g

If you compare the price of oil in Apr-2020 to Apr-2021 it shows an increase of 240% which is what is used in the CPI calculation despite the fact that the price of oil was more or less at the same level as 2019.

Er, yeah, that's obvious. I thought you were inferring something eles. Are carbon taxes included in the CPI, because those utter mongs in government don't appear to be concerned at the rise in energy prices they have orchestrated and so far have stated they have no intention of backtracking on?

A few pages back you stated government debt per capita wasn't a good way of looking at it or some such.

My benchmark is government debt per income tax payer, which at €150,000 per head is insane in my view. Sinc e income tax payers are a small group, they are the rock from which the blood has to be squeezed in order to pay the debt. Simply not possible that I can see. We are more indebted than Greece. God, I can't wait to get out from under this: imagine something large, heavy and descending fast in a classic Road Runner cartoon, as being fairly appropriate.

Of course its a complete coincidence that many of those sectors you mention ie pharmacy, legal, insurance are where TD's run their businesses

Yes it is measured on price per quantity. So if manufacturers reduce the size and keep the price constant this will lead to inflation in the CPI.

Increases in the PPI do not always feed into the CPI because depending on the product if the manufacture passes on the increase in cost it could lead to a decrease in sales and loss of market share etc.

e.g.

If a company thinks that the increase in cost is temporary this will lead to an increase in the PPI but is unlikely to be passed onto the consumer because the company are happier to accept a reduced margin and keeping the sales volume because they believe that the margins will increase in future.

The one measure I am keeping an eye on at the moment is consumer sentiment as drop in that is the first sign of cooling in the economy. It has has already dropped in the USA which means that consumers will be putting off purchases and as a result shows signs that the economy slowing down which should reduce inflationary pressures.

We are not more indebted than Greece.

Greece pay 5.4% of their tax revenue on paying interest on government debt and have double the level of debt than Ireland when compared to tax revenue and GDP/GNI.

Watching the markets, I start thinking that rising rates is the only remaining black swan for property markets.

imo less so because of mortgage rates (Irish property has very high yields anyway and mortgage rates are quite high here for other reasons) but more because it will force the government into austerity, ie falling rents due to reduced support HAP etc. and less government bidding on properties as EU debt rules will block it.

More, more, more. good luck to anyone paying their own rent trying to compete against hap-

HOMELESS CHARITIES WILL tell politicians today that the Housing Assistance Payment (HAP) needs to be increased as renters continue to require to ‘top-up’ the payment as rents rise across the country.

As the GDP/GNI grows so does the tax revenue.🙄

I did show the government debt to tax revenue.

The whole sector needs root-and-branch reform. Ultimately I got fed up of the unprofessional (and in cases outright dishonest) conduct of EAs.