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

This analyses actual drawdowns by FTB and SSB. Probably the most comprehensive dataset on mortgage lending there is. Nothing on 2022 yet but headline.

2021 average FTB LTI 3.2x (3.1x in 2020)

45.2% FTB mortgages between 3.25x - 3.5x income. 10.8% above 3.5x. 43.9% below 3.25x.

What age are you ? This is primary school thinking ...all markets are driven by sentiment , it is unquantifiable as shown by the contributions to this forum but when it changes buying stops and crashes happen . Escalator up elevator down .

I know it is not common that salary in ireland, but i'd wager that the mayority of people actually buying now are high earners. It wouldn't be too uncommon in a couple of people working for the tech sector. People earning the median salary cannot afford to buy now unless they have a big fat deposit

Edit: I just saw your FTB figures. Would you have info on how many of the mortgage aplications are for FTBs?

All here

for 2021, 22,895 FTB. 14,969 SSB

This is for new mortgages only

I suspect a lot of FTB’ers target new builds at the the €499,950 level to avail of the HTB. Even if their income would allow them to go much higher, psychologically a lot of people will really want to get that €30k grant.

They have had 14 years of the lowest mortgage rates around with majority of repayments going against the principal balance so will have a significant wedge paid off as long as they have been making full payments all along.

Yeah granted but eaten bread is soon forgotten people would of made lifestyle decisions on low interest rates its just human nature to do so and anyone with a fixed or tracker rate will be feeling these increases. At least banks would have stress tested interest rates rising which is positive. We also have a swarm of people who held off due to Brexit, then covid and now the Ukraine. Rates rising will dampen affordability and demand. The option of moving abroad has opened back up IMO with property prices dropping in Oz, Canada and the US so we may see our old reliable emigration release valve kicking in at some point in the next 24 months.

I get the point on people getting used to lower payments but assuming that they paid for the 14 years and with rates so low they would have paid off a substantial amount of the principal.

Anyone that maintained the same level of payment from ‘08 would have probably paid off the mortgage by now. The people who will feel the pain of rates rising are the people who got into financial difficulty and renegotiated lower payments as they will still have a large principal balance.

For that poster looking at New Zealand, the wind is at your back.

Decision time on Irish assets maybr

So much wrong with this post. You really think people will pay any money as long as they can afford it.... Clueless.

Sentiment is biggest mover of markets. People have been paying more and more because sentiment and policy has been behind the market for the last decade.

Rates are rising, cost of living is rising, recession is imminent. There will be people who can no longer afford to buy. As soon as we see potentially declines and SENTIMENT shifts, even those who can afford to buy will either hold of or only be prepared to pay less. As sentiment shifts more, investors will consider selling. This can quickly turn into a momentum driven spiral, people spend less, not just on housing, but in general. This effects business which in turn effects jobs and further effects buying power.

All the while there will be people who can buy, but they wont. They will be waiting for "the bottom" Always amazes me how people forget the last lesson and come up with some new narrative on why property can only go up.

I didnt miss the point. You literally said as long as people can afford to buy, they will buy.

Thats not true. While I agree, people will pay anything they can afford, if narrative suggests prices are going only up. Once that narrative shifts and sentiment is that prices are going down, people wont buy, they will wait.

I'm one of those renting in my late thirties. I'm approved for a certain amount, if interest rate rises continue it will effect my repayment amount. I will then need to look at cheaper houses or have a lower cut off point when bidding. There's thousands of me, so if everyone needs to adjust based on repayment capacity and interest rates, prices will drop.

Interest rates are guaranteed to go up at least another 1% this year so it doesn't take a rocket scientist to work out what'll happen if wages don't rise accordingly.

Separately, the energy crisis we're facing is likely going to cause a deep recession. A lot of manufacturing will be affected, SMEs and small businesses won't survive 4X bill hikes. Those whose job is unaffected will have way less cash in their pockets and won't be as confident about getting that big mortgage.This will take huge amounts of demand away.

IMO, The only way is down for prices or stagnation at best.