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

BlueSkyDreams · 16-11-2023 01:04PM

https://www.boards.ie/discussion/comment/121374935#Comment_121374935

Does anyone know what percentage of the population own their own home outright?

Mortgage paid off.

Surely those folks experience a different CPI, with no mortage or rent to pay.

Padre_Pio · 16-11-2023 01:19PM

https://www.boards.ie/discussion/comment/121375171#Comment_121375171

I wouldn't see it as a saving at all.

As I mentioned previously, there's no explanation why Dublin prices dropped while the rest of the country continues to increase. Since there were less sales overall, it's easier to skew the results. I would imagine there are a few big falls in the €1million+ price range in Dublin, which have masked the many minor increases in the sub €1million range.

If you're in the former category then you're likely saving more than 1.9% compared to last year

If you're in the latter then you're not seeing savings at all.

Either way, you're still paying 20% more on the purchase price of an "average" house today than you were pre-pandemic.

Villa05 · 16-11-2023 02:08PM

Eoin Mcgee has his own podcast

This one is on housing is worth a listen, plenty of advise

https://open.spotify.com/episode/0VuzqKV5z9pQstgGoOwXoU?si=e241869725914b51&nd=1&utm_medium=organic&product=open&%24full_url=https%3A%2F%2Fopen.spotify.com%2Fepisode%2F0VuzqKV5z9pQstgGoOwXoU%3Fsi%3De241869725914b51&feature=organic&_branch_match_id=1124802866406332680&_branch_referrer=H4sIAAAAAAAAA7WNywrCMBREvyZdtiZ9aIUigtSFC3FhcSdpmrahMbnmgdivNxX8BGEWwwyHMzoHdpskFrQT%2FTumALEUakp2YHTnmas0cBUhkvVeyrs3shoXBKV7ROqQ5Y5%2FNNOPMHEQVnc8tFXj5%2BepyecSLtYNR31%2B3fQVpbUVKD1wkuFNUa5JXuKszfHXQqVsKZv%2Ba0KkUF3YcdRz6rzhlTYDVYJ9AE6C4d4PAQAA

16-11-2023 02:43PM

https://www.boards.ie/discussion/comment/121375108#Comment_121375108

Ignorant of airbnb, I am not, as a host I can just go into my airbnb account and see what fees apply in Ireland.

You are wrong about those fees not being country dependent, in fact one of the links you posted specifically mentions how differing fees apply to different countries due to their rules related to short lets:

Quote:

Italy, South Korea, China and Germany: Different policies apply for all stays in Italy and for South Korean guests staying at places with Strict cancellation policies. The flexible long-term policy is not available for stays in China. Additionally, if you are a Host in Germany, please make sure that your selected cancellation policy complies with the local requirements. Learn more about cancellations in Germany.

In relation to Ireland, here is what airbnb have on the fees section of the host's account:

Host fee

Most Hosts pay a 3% fee but some pay more, including:

Hosts with listings in Italy
Hosts with Super Strict cancellation policies

This fee is calculated from the booking subtotal (nightly rate + cleaning fee + additional guest fee, if applicable – excluding Airbnb fees and taxes) and is automatically deducted from the Host payout.

Guests, however do may a higher service fee when booking, so perhaps in your rush to post/judge, you looked at all fees involved.

Guest fee

Most guest service fees are under 14.2% of the booking subtotal (nightly rate + cleaning fee + additional guest fee if applicable – excluding Airbnb fees and taxes). This fee varies based on a variety of factors and is shown during checkout before you book so that you know what to expect. For some stays over three months, the Airbnb guest service fee is reduced after the third month.

Or perhaps you were thinking of host-only fees charged to hospitality specific listings like hotels, serviced apartments etc, or in certain country dependent locations:

2. Host-only fee

With this structure, the entire fee is deducted from the Host payout. It’s typically 14–16% although Hosts with Super Strict cancellation policies may pay more and fees for monthly stays may be less.

This fee is mandatory for traditional hospitality listings – such as hotels, serviced apartments, etc., as well as software-connected Hosts (unless most of their listings are in the USA, Canada, the Bahamas, Mexico, Argentina, Taiwan or Uruguay).

So you are absolutely wrong to say it is not country dependent, and few if any listings that I have seen in Ireland have the "super strict cancellation policies" which I'm going to leave you to look up.

So your calculations, and assumptions comparing airbnb income to tenancies as they apply to Irish hosts are flawed, not just in your lack of understanding of how airbnb works in this country, but also in your 30 day term, which currently does not apply here, and which may never apply here. Even at 90 days, which would work out at most weekends of the year, at my average listing price, I would earn only slightly less than a tenancy.

Whether it is 3%, or even 14%, obviously hosts are willing to accept less income in order to not have tenants. Let's just leave it at that.

Blut2 · 16-11-2023 02:59PM

https://www.boards.ie/discussion/comment/121375886#Comment_121375886

"some pay more, including: Hosts with Super Strict cancellation policies"

"With this structure, the entire fee is deducted from the Host payout. It’s typically 14–16%"

You should probably have actually read that before posting it. It just confirms you were completely wrong 😂

No wonder you're afraid to return your property to the private sector rental market if you can't even understand the AirBNB fee structure. You should definitely stick with the less challenging option.

16-11-2023 03:46PM

https://www.boards.ie/discussion/comment/121376004#Comment_121376004

You think the reason hosts don’t return properties to the rental sector has anything to do with understanding airbnbs fee structure?

How could anyone with even a modicum of understanding of the well publicised issues with renting possibly think that? Incredible.

lordleitrim · 16-11-2023 03:51PM

https://www.boards.ie/discussion/comment/121375215#Comment_121375215

You could say that about petrol inflation for those who don't use cars or butter inflation for those that don't use butter. It's probably meaningless to silo various goods in the CPI basket just because you don't use those particular goods. If inflation is generally going upwards, it will hit you some way, be it your bus fare, your Big Mac, your health insurance or your toothpaste.

Suffice it to say, if you own your home outright, your disposable income is obviously far better than someone who doesn't but your euro only goes just as far as the renter next door...except that you may have more euros....

BlueSkyDreams · 16-11-2023 04:19PM

https://www.boards.ie/discussion/comment/121376240#Comment_121376240

More euros, but less demand to spend them.

People in that position must "feel" a different level of CPI, although I understand it is one rather crude calculation.

I would be interested to know the percentage of outright home owners anyway. I wonder if it is decreasing now, given the cost of housing.

Frank Bullitt · 16-11-2023 05:12PM

They recently imposed new legislation over here in Vancouver around Air Bnb

https://bc.ctvnews.ca/b-c-is-bringing-in-new-rules-for-short-term-rentals-here-s-what-s-changing-1.6603052

It has only been a few weeks, but there have been plenty of people with various properties playing the victim, that it's their retirement plan etc etc. Not much sympathy for them.

You do see a lot now on Craigslist and Facebook Marketplace, but the prices are clearly to try and not take too much of a hit on them. Time will tell how it plays out over here.

OEP · 16-11-2023 05:31PM

https://www.boards.ie/discussion/comment/121376004#Comment_121376004

I have no skin in this but it quite clearly says hosts in Italy or hosts with Super Strict Cancellation policies pay that much? And the host only fee applies to hotels or serviced apartments.

L1011 · 16-11-2023 06:16PM

Time to drop this

lordleitrim · 17-11-2023 11:25AM

What do folks think of this proposed closed bid process that they might introduce in Ireland? At least this would eliminate fears about phantom bids or that you are bidding against yourself...

“They will examine the evidence, they will hear people’s stories. But I know in Scotland they have a different system of bidding, it is a closed bid where a person puts in their bid once and the highest bidder gets the house. I am not saying it is the best thing to do, it might not be, but at least it gets away from that stress a lot of people experience several times. By the time they actually get to buy a house, they were outbid a few times and it drags on for weeks.”

Bidding process for buying homes in Ireland could be overhauled after expert process

https://www.irishtimes.com/politics/2023/11/14/bidding-process-for-buying-homes-in-ireland-could-be-overhauled-after-expert-process/

17-11-2023 11:47AM

https://www.boards.ie/discussion/comment/121379354#Comment_121379354

Is the owner allowed to set a price below which the highest bid will not be accepted?

17-11-2023 11:55AM

Neighbour recently sold up, and chose to sell to a young family instead of a shady character who bid 5k more. What we have at the moment is not perfect, but it's better than the closed bid process IMO.

PS. Also, it's naive to think that any other process is not open to corruption. For example, what's to stop an insider contacting an investor that's giving them backhanders and telling them the current highest bid on property X is €415,000 etc.

amacca · 17-11-2023 12:07PM

https://www.boards.ie/discussion/comment/121378837#Comment_121378837

one would wonder if the money will just be swallowed up and the apartments priced higher anyway....is there any sort of mechanism to limit the price charged on the private market?

Elessar · 17-11-2023 12:09PM

https://www.boards.ie/discussion/comment/121378837#Comment_121378837

This is good to see, and we need more of it, especially in Dublin. However the cynic in me thinks that despite the subsidies, the apartments will still retail for ~€4-500k. Most buyers in that range will want a house, and they will struggle to sell these. Ultimately the state and various AHBs will then step in and buy up most of them and the blocks will become defacto social housing ghettos.

I hope I'm wrong.

L1011 · 17-11-2023 12:40PM

https://www.boards.ie/discussion/comment/121379454#Comment_121379454

In Scotland, yes. You are meant to advertise at your base acceptance price with "offers over".

Villa05 · 17-11-2023 01:49PM

https://www.boards.ie/discussion/comment/121379565#Comment_121379565

Disaster waiting to happen

If the project is unviable, let market forces work till it's at a point of viability.

DataDude · 17-11-2023 02:09PM

https://www.boards.ie/discussion/comment/121380052#Comment_121380052

I agree with your sentiment but

’we missed housing completion targets by a mile because we’re letting market forces work’ is not a vote winning strategy in an election year.

Government focus is very much on delivery as many units as possible and getting people into those houses. Affordability becomes secondary when you have chronic under supply.

Best way to stimulate more supply in the short term is to drive prices higher (see 2004-2007).

SharkMX · 17-11-2023 02:31PM

https://www.boards.ie/discussion/comment/121376004#Comment_121376004

You should give up. You are just arguing for the sake of pretending to yourself that you didnt lose the argument now. At this point its like you are trying to crawl up your own arse :)

Villa05 · 17-11-2023 02:39PM

Rather intresting stat

https://twitter.com/danobrien20/status/1725470603287601267?t=Yln8ejD7j0BaR5Eu3EApaw&s=19

SharkMX · 17-11-2023 03:12PM

https://www.boards.ie/discussion/comment/121379565#Comment_121379565

Tax payer handouts to builders is all this is.

18-11-2023 12:42PM

https://www.boards.ie/discussion/comment/121380624#Comment_121380624

As much as people seem to loathe builders/developers, the quickest and probably cheapest way of getting large scale supply of houses, is to incentivise the private sector to build them.

herbalplants · 18-11-2023 07:55PM

New mortgage provider has launched in the Irish market.

MoCo, which is owned by Austrian bank Bawag, began offering services yesterday.

theboringfox · 18-11-2023 09:26PM

https://www.boards.ie/discussion/comment/121385543#Comment_121385543

Good to see more competition. Had a quick look. Best rate is 4.65%...not exactly game changer. When avant entered they had cheapest rates

DataDude · 19-11-2023 09:04AM

https://www.boards.ie/discussion/comment/121385983#Comment_121385983

A read of their website suggests they’re going to aim for smaller volumes, excellent customer service (‘decision in days’), but be the most expensive in the market.

There probably is a gap given with the torture the existing banks put people through. But not going to do anything to long term competitiveness with that rate strategy which is unfortunate.

Eclectic Econometrics · 19-11-2023 11:36AM

https://www.boards.ie/discussion/comment/121387111#Comment_121387111

How long did it take you to get mortgage approval? I got a HVM mortgage approved from the underwriters, with an exception from the banks normal maximum for FTB's, which I think my guy told me was 750k, in less than a week.

Not to promote, there are so few banks you can guess, they have people at the bank who will analyse any property you are interested in and provide you with same day feedback on comparative value, location etc. The service is exemplary, to be honest.

As far as pain points go, I'd say dealing with banks in Ireland is a 1/10 and the dearth of property is a solid 10.

Here's an interesting take on Bawag - https://petrusadvisers.com/media/20230630_-_bawag_-_back-up_materials_vf.pdf

Villa05 · 19-11-2023 12:21PM

Another intresting stat from last week that seems to have been overlooked. All that lobbying appears to be reaping significant dividends for the developers

A decent bit of journalism, but one point that is ommitted from him and other commentators is that: if state subsidies are becoming a much greater part of new home price. There is an increasing negative equity risk to the buyer in a downturn as those subsidies are not available to the next buyer

But while a gap has opened up between the capital and the rest of the country, the more noticeable divide is between new builds and second-hand homes.

Whereas the value of second-hand properties sold dropped by 1%, new builds soared by 10.4%........

It’s because the state will spend hundreds of millions per year on HTB and shared equity.

The whole point of these is to help people buy homes. If they are just pushing up new build prices, it makes it harder for everyone who isn’t using these schemes to buy.

This would make the schemes largely pointless and potentially a massive waste of state money.

Taxpayers should know whether their money is being spent wisely, or just feeding into the very problem it is trying to fix.

https://www.thejournal.ie/house-prices-new-builds-ireland-6225785-Nov2023/

DataDude · 19-11-2023 12:37PM

https://www.boards.ie/discussion/comment/121387562#Comment_121387562

I can’t remember specifics as we weren’t in a rush. Wasn’t too bad for us but we drew down a very low LTI and LTV. Approval was quick. Before drawdown there was some bizarre querying of individual transactions

‘what’s this €1,200 purchase?’

Type response in portal

2 days to read response

‘what’s this transaction…’

This with a bank I’ve used for 10+ years and had saved a few hundred thousand for the deposit.

I also saw with friends scenarios like

’youll probably get the exemption but we won’t give it to you until you identify a property’

’but how can I know I can afford it then if you haven’t confirmed the exemption?’

Shrugs.

It’s far from steamlined so there is definitely room for a first class service (instant responses. Any day of the week) but at a slightly higher cost.

Assume in future a Fintech will link into your finances at all time (with your consent) and be able to underwrite your mortgage in seconds.

Villa05 · 19-11-2023 12:40PM

https://www.boards.ie/discussion/comment/121380211#Comment_121380211

Best way to stimulate more supply in the short term is to drive prices higher (see 2004-2007)

I suppose that's our worst fear, the major difference is that the state (a much larger indebted one) is the subprime actor in this cycle through:

Initially the ftb grant

Through shared ownership they are underwriting the riskiest part of the mortgage

In subsidising apartment developments that appear to be unviable since at least 2019, we are underwriting the riskiest developments at what appears to be the top of the cycle with little demand for the end product from private buyers

Brace!!!

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

Comments

Host fee

Guest fee

2. Host-only fee

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