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

We were dishing out up to 25k+ work permits to non eea workers plus migration from within the EU in that 9 year period, most requiring an immediate housing need. Moving from 16k first time buyers to 36k may well be deterioration in the overall picture

He said it in 2014, just before prices began to climb again.

Look we can go around in circles about this. The reality of the situation is that the state implemented policies that has made accommodation hugely expensive and priced many tens of thousands of people out of ever owning a home. This, in turn, has likely scuppered their chances of settling down in life, because it's rather hard to settle when you live with your parents in your 30s. Should these people have bought years ago? Absolutely, but many of them couldn't and even if they could, we're not talking about buying bitcoin when it was work 100 euro a "coin". Without being too dramatic, these people were thrown to the wolves to reinflate a property market for the sake of short-term gain.

Maybe I'm wrong to care. After all, I do own a home as I've said, but I genuinely am hugely concerned about the future of this country. I don't think we're going to agree here, but I respect that your views differ from my own.

Nail/head

Buying a home is the longest term investment for the majority of purchasers. It'll be with you till the end. It's in all owners/renters/buyers/sellers to have a sustainable market always

Only speculators are served by the existing market

A drop of home ownership rate in the age cohort from 60% to 27% doesn't require me to infer any meaning, the horrific figures speak for themselves.

The vast majority of people would rather own their home rather than rent it. Particularly those in that said cohort that previously would have owned their own property.

The idea that home ownership rates for these people have almost halved because people "people may not be interested in buying houses" is pretty incredibly distorted logic. You have heard of the current, ongoing, worst in the history of the Irish state housing crisis right?

Theres a reason every poll shows housing as the #1 issue for Irish voters, and its not because hundreds of thousands of people have made a happy choice to rent for their whole lives.

I didn’t count every penny as a loss. If you make capital investment in something and don’t recoup your money, it’s fair to call that a loss. Maintenance and upkeep, no.

I’m not complaining btw. I’m in a pretty good situation overall, I have a large house in a nice suburb of Dublin. Lots of people who bought in the boom didn’t fare as well. But the only way forward for me was to cut back my expenditure, save my money and keep doing that for many years. There’s no one on this thread to whom this advice can’t apply. Getting angry at “boomers” or other ridiculous inventions might make them feel better but it won’t help their situation.

The point is

a) every generation has had challenges in home ownership.

b) the idea of resenting and blaming other generations for the current situation is deeply unhelpful and can’t end well. It’s self pity and deflection, nothing more.

An increase in the number of third level graduates would suggest a significant increase in the earnings of the 25-34 year old age demographic in question, ie an increased ability to purchase a house all else being equal. A 30 year old college graduate earns significantly more on average than a 30 year old who never attended college, and the former will obtain a mortgage much more easily.

The drop in house prices during/after the 2008 recession was also accompanied by widescale unemployment, increased taxation, reduced wages and very limited bank lending that had a massive impact on the ability of people to buy houses.

The drop in home ownership rates for 25-34 year olds from 60% to 27% is pretty much exclusively explained by the housing crisis. The idea that the number of people in this age demographic who want to rent (at a time of astronomical rent prices) has doubled in the 15 years in question is absolutely delusional.

And, again, this is not my conjecture - its backed up by all the polling on the issue, which show housing affordability is the #1 issue for this voting demographic. They aren't saying that because they're happy renting, its because they've been locked out of the housing market and are unable to buy, while very much wanting to.

"The drop in home ownership rates for 25-34 year olds from 60% to 27% is pretty much exclusively explained by the housing crisis. "

Then why did most of the drop occur before the current housing crisis?

"A 30 year old college graduate earns significantly more on average than a 30 year old who never attended college, and the former will obtain a mortgage much more easily."

That's true now, but it wasn't 20 years ago when less people went on to third level education, and even before that when third level education was nearly exclusively for children of well-off parents.

No. I'm making the simple point in general - not to you specifically - that there are simple metrics that those condescending at younger generations would do well to look at. The first was whether they, on a presumably senior role salary, would be able to get a mortgage for their own house today? (And I am referring to the average person - not edge cases)

The second metric was to look at the multiple of equity in their house to their current net after tax income from employment. Why did I pick current income? Well there are two general components to salary increases. The first part of salary increases is the simple inflationary one. The second part of salary increases is the "promotion" one. For most people, it would be assumed that they increase their salary in real terms over their career due to the "promotion" aspect. If that multiple is 15X (which I think wouldn't be too unusual) then I think it is fair to say that your equity was not built up purely off the back of your own efforts. What has happened is that your property wealth has increase faster than you were able to increase your own income. That is not a good situation because it means that that target - for someone trying to get on the ladder - is moving away from them faster than they can move towards it. It's not only moving faster than inflation, it is moving faster than inflation + improvements or investments in yourself.

Wealth in society is generated by labour, innovation, and efficiency gains. But it is people who generate that wealth. Property just sits there. If you look at the macro level and it is the case that increases on wealth are disproportionately accruing to the owners of property then you have a situation where those who were wealthy to begin with, are increasing their wealth passively off the backs of the actual wealth generators.

(People can also increase personal wealth through windfall or inheritance etc. I'm stripping them out for the sake of the above)

I got my data from the CSO and the decline has been gradual.

If you're saying that home ownership has collapsed in the last 5 years alone then I'd love to see it.

What I'm saying regarding college is that people didn't need a college degree to earn a living. People got decent jobs with leaving certs, FAS courses and trades. Someone could leave school at 17 in 2000 with a leaving cert, have 5 years work experience and a few promotions under them and be in a position to buy a house.

The same person today would need a degree or a trade plus a few years work experience to even get near a salary to afford a house. Therefore the age a person purchases a house in 2022 is much later than someone 20 years ago.

Even if there was actually a cliff-face fall off in terms of new people entering, what you would be seeing is the people who did buy being gradually aged out and into a higher bracket.