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

So how did you guys afford it? I not asking personal full in depth answer?

Generally it's because people lived at home or help from family? These are not options for everyone do.

When you are offering below market rate housing one can put stipulations that the rent is deducted from your wages. Its not impossible as we saw with property tax.

If you value your "human rights" that highly the private market will glady cater for you

These stipulations will never be introduced because they will be construed as removing people's choices.

I value all human rights (not just my own which you appear to be suggesting) but with those rights comes rights and responsibilities on those who benefit.

It is relevant though. The State won't do it because of the minority who shout loudest not to introduce it.

You may not see it as an abuse of human rights but it will be portrayed as such. It goes back to a societal issue.

To expand this with an example not housing related. How many times do we see petty criminals with hundreds of previous convictions appear before Judges and get a slap on the wrist. It is they who receive more support from the State than the actual victims get.

It is those people who should be catered are the very ones who are not.

People who break the law should repay society even if it means working to clean up graffiti etc. People who refuse to work should receive food stamps. But this will never happen because all those in power are only interested in staying there and will spend taxpayers money to achieve that irrespective of whether the cost of doing so.

We actually need a fundamental change in our mindset but I fear we have gone too far for it to happen.

These are not just Irish problems. The welfare state has created an entire class that would not survive without it, and it is bleeding everyone else white to sustain it. Furthermore, aside from the financial implications, entire generations have grown up expecting that the state will provide them with everything and solve all of their problems. It has, in effect, infantalised us.

With regard to housing, the idea that the provision thereof is a right is simply fatuous. If one cannot afford a house, they should not get a house. What happens with the welfare state is that those who would be able to afford a house (i.e., people who work) are denied access to housing because it is given to those who genuinely could never afford it. Thus, if housing is a right, people like me have been denied it. I look forward to putting that quandary to the next lefty suit who asks me to vote for them.

I'm not a Dickensian character or anything, but I do not expect or even want others to give me anything except honesty and their good behaviour. Those who fall on hard times through no fault of their own deserve to be helped with dignity and respect, but that can be done without big government slipping its fingers into things.

Thus, I agree. We need a monumental change in how things operate here, and we are too far gone to affect it ourselves. Thankfully, natural laws of scarcity are starting to kick in, so one way or another, this whole thing will come crashing down eventually. Sadly, the key word there is "crash". Ergo, we'll ride the spiral to the end and may just go where no one's been.

it wont take much for it all to crash .. we have a massive bonfire blazing on europes doorstep it wont take much for the russia/ukraine war to destabilise europes entire economy ..and housing market here once more

Seems we are in a game of build up and crash the property market until the crash is big enough it cant be temporarily saved with some bank version of rearrange the deck chairs on the titanic.

Sure why wouldn't the banks and government do it again? It was easy enough to blame the plebs for it in 2008 and get away with it. If it aint broke...

The end of QE will kick it all off. And ending QE is absolutely necessary in this inflationary environment, it is insanity to think it is necessary at the moment. But we will see it end very soon and markets will react accordingly which will end up impacting out own housing market. How exactly remains to be seen but the end of QE will be the trigger (Ukraine and COVID are BS reasons which justified sustaining or ending QE, the only reason it was implemented for so long was to enrich those who had the ear of policy makers, generally the older people who head up lobby groups, have pensions dependent on the market etc. - they've been made whole and then some after 08 so if they aren't already sitting on profits then I think they'll be taking a bath very soon and it will be a case of "once bitten, should've been twice shy").

Why the central banks have really messed up is clear; they left the magic money printers on for too long with negative effective interest rates, ignoring the inflationary signals and bubbles in assets, which means that now we have actual inflation across the board they won't be able to arrange for a "soft landing" in the form of gradual QT and interest rate rises. Something needs to be done and very soon by the central banks involving QT and interest rates.

If we had 61 financially healthy developers outside nama, they could have purchased the sites and built when materials labour and land was much cheaper and maybe our supply issue would be much smaller now. Most experienced investors know that after a crash is the best time to invest

The fact that they were dragged into Nama probably meant they were untouchable for raising finance given that all were tarnished with the same brush.

Instead sites were sold to investment funds with no development experience to sit on and collect the capital appreciation

Looks like a setup to starve supply from where I'm sitting.

They will stop buying new assets. Those they bought will just mature and automatically roll over or else the debt will be magicked away, because there won't be any repayment to the Fed and the ECB, that's pretty obvious.

For the last few months the markets have baked in policy errors, involving Fed actions around commencing QT and raising interest rates which cause a recession and lead to a reversal (ie lowered rates and QE) within a year (can likely apply this to the ECB as well). They've both put themselves in a terrible position, all of their own doing.

Yes, I think it is quite clear that the policy of the last twenty years to inflate assets to create wealth for asset holders has run out of steam as it turns out that a lot of people, post-08, actually didn't get lifted onto the asset-owning boat, which means that the policies used in the build up to 08 were the wrong ones to be used as part of the recovery post-08 when they were the main focus, they should've been tempered with more of a focus on non-asset owners (maybe there was merit to focus on inflating assets until maybe 2012/13 but after that the approach should've dramatically shifted).

Looking back, of course it seemed to make sense in the 00s to allow individuals get a foothold in an asset like their house as the policies were aiming to ensure that such house would increase in value and give that person wealth and a stake in society. Owning a home gives a person purpose, worth and stability. The crash of 08 crushed this idea. However, after 08, the same approach was taken to reignite this asset owning dream, to effectively bail out these people and help them restore their wealth which they had lost after 08. Obviously this could be seen as reasonable if the vast majority of people had this wealth in their home and would benefit from policies reinflating asset prices.

However, it seems quite obvious that a large number of people were left behind by these policies and now we are approaching a situation where more and more people are being shut out of having a stake in a society (ie owning a home); with our politicians and central bankers now scrambling to try to figure out how to help the asset owners and the non-asset owners at the same time. The reality is that they can't be all things to all men but they are too wedded to the policies and ideas they implemented pre-08 to inflate assets and a change in approach now would be to (1) cool their own wealth and (2) admit they were wrong.

For me this is about human nature and our regulators and politicians are humans who don't like to admit they are wrong. a lot of them are older and therefore were part of the problem pre-08 so it isn't surprising that they didn't shift their policies or ideas dramatically, as they would be admitting their last 20 years of their careers was a bit of a mistake.

Up until this part, I am reasonably happy with my assessment but the next paragraph is where I am still trying to figure things out.

What I think this means is that because we are using the same policies and way of thinking in our policies as we were doing pre-08, we could see this "asset pumping" approach of the last 20 years fall hard on its ass when things do unravel. So, for me, that looks like (using the same comments as those screaming before 08 used, "you typically lose half of what you gained in a bubble"), looking at something like a correction back to 2017/18 (or 2005) levels before getting some equilibrium.

Thought I'd share a very well made documentary from RTE in 2007. Some people might find it interesting, particularly younger folks who wouldn't remember the signs the **** was starting to hit the fan.

They give a very good breakdown of how a lot of other property crashes have occurred, not just the one here in 2008. "It was different" nearly every time.

Mad how accurate this was about how the last one might unfold.