Did Michael McDowell burst the housing bubble?

VoidStarNull · 01-05-2007 10:13pm #1

A lot of people seem to believe that stamp duty is a critical issue holding
back the property market, and that poor Michael McDowell is responsible for
creating the crisis by first suggesting that it might be abolished.

Personally I think that affordability and interest rates are the critical factors
affecting the market but I do agree that McDowell may have to take the
blame as "bubble-burster". Here's why:

In "A mathematician plays the market", John Paulos explains a critical
distinction economists make between "mutual" and "common" knowledge.
For example, if everyone knows that houses are unaffordable, then it is
"mutual knowledge". If everyone knows that everyone else also knows
this fact, then it is "common knowledge".

The distinction is important: if I know that houses are unaffordable, but I
believe that other people do not know this, then I may expect that prices
will continue to rise. This makes it rational for me to buy a house in the
hope of making a profit, even though I consider the house to be
unaffordable.

However if I know that everyone knows that houses are unaffordable, then
there is no rational basis for me to buy a house.

By announcing on national television that stamp duty needs to be
abolished to make houses more affordable, McDowell appeared to be
telling everyone something they already knew: houses are unaffordable.
However, everyone now also knew that everyone else knew this fact.
Result: KAPOOM!

An interesting confirmation of the economic theory?

edanto · 01-05-2007 10:20pm

No, I don't think you could blame it on one person, or one TV show, or even a thread in this forum, to make an appeal to the ridiculous.

The really interesting story for me, will be the analysis in a few years to see what caused the great housing price rise of the 90s & naughties. I think the banks will come in for a bit of criticism. Not that they'll care, they'll be laughing all the way to the... eh... office?

Pa ElGrande · 01-05-2007 11:14pm

Before anyone assigns blame read "Manias, Panics and Crashes" if you want to understand the heard mentality in financial/asset or any market, that and "Extraordinary Polular Delusions and the Madness of Crowds" by Charles Mackay. (free but harder to read)
Or for an easier read try "A short history of financial euphoria" by John Kenneth Galbraith.

The final and common feature of the speculative episode ... is what happens after the crash. This, invariably, will be a time of anger and recrimination and also profoundly unsubtle introspection. The anger will fix upon the individuals who were previously most admired for their financial imagination and acuity. Some of them, having been persuaded of their own exemption from confining orthodoxy, will, as noted, have gone beyond the law, and their fall and, occasionally, their incarceration will now be viewed with righteous satisfaction.

There will be scrutiny of the previously much praised financial instruments and practices ... that have facilitated and financed the speculation. There will be talk of regulation and reform. What will not be discussed is the speculation itself or the aberrant optimisation that lay behind it. Nothing is more remarkable than this: in the aftermath of speculation, the reality will be all but ignored.

There are two reasons for this. In the first place, many people and institutions have been involved, and whereas it is acceptable to attribute error, gullibility, and excess to a single individual or even to a particular corporation, it is not deemed fitting to attribute them to an entire community, and certainly not to the whole financial community. Widespread naivete, even stupidity, is manifest; mention of this, however, runs drastically counter to the earlier noted presumption that intelligence is intimately associated with the money. The financial community must be assumed to be intellectually above such extravagance of error.

The second reason that the speculative mood and mania are exempted from blame is theological. In accepted free-enterprise attitudes and doctrine, the market is neutral and accurate reflection of external influences; it is not supposed to be subject to an inherent and internal dynamic of error. This is the classical faith. So there is a need to find some cause for the crash, however far-fetched, that is external to the market itself. Or some abuse of the market that has inhibited its normal performance.

Excerpt from A Short History of Financial Euphoria by John Kenneth Galbraith.

VoidStarNull · 01-05-2007 11:26pm

I think you're both quite right: it is wrong to blame a single individual for the
boom and the coming bust (and thanks for the great exerpt from Galbraith, ElGrande - amazing how long all this stuff has been known and yet it keeps
happening over and over).

I definitely agree that the fundamental problem was that people convinced
themselves that prices would rise forever, far above rents and incomes (the
only natural supports for property prices).

At the end, any tiny event would have been enough to turn sentiment
around and reverse the market. But the "tiny event" may indeed have been
McDowell's promise on stamp duty. Although McDowell was not responsible
for the bubble, he may be remembered in times to come as the man who
provided the "tipping point".

sandymount · 01-05-2007 11:27pm

I would blame the media rather than McDowell. Firstly they twisted what he said, he said that it would be PD policy to reform Stamp Duty over 5 years. Secondly it could be PD policy to send a man to the moon but if FF don't agree, it ain't going to happen. I would suspect that many media execs have been trying to offload investment property over the last 9 months. One of the final stages of a bubble is insider trading. The are plenty of cute hoors around who are aware of the impending crash and are heading for the exits.

Pa ElGrande · 02-05-2007 5:40am

VoidStarNull wrote:

At the end, any tiny event would have been enough to turn sentiment
around and reverse the market. But the "tiny event" may indeed have been
McDowell's promise on stamp duty. Although McDowell was not responsible
for the bubble, he may be remembered in times to come as the man who
provided the "tipping point".

What ever else you can blame McDowell for, the end of the housing bubble is not one of them, It beacame obvious the market was in trouble in summer 2006 - see the infamous "current public sentiment towards the housing market" thread. (stated in July 2206, McDowell only opened his mouth at the end of September). The tipping point was the rise in ECB interest rates (Trichet's "strong vigilence"), making credit more expensive, this reduced (and continues to) property investors margins, so they want out to seek a better return elsewhere, at the same time FTB's who had previously been approved for higher loan amounts, found that when they went 'sale agreed', that the amount the could borrow had been reduced and sales started falling through. People in 'chains' have found that their first property is taking longer to sell (i.e. 6 months or longer instead of the expected 1 month), so another rung of the ladder is broken, in this environment its easy to conclude that stamp duty is the problem and while I agree its an unfair tax, the real issue is affordability. Do you ever wonder what the bank economists keep saying the "interest rate cycle will peak at 3.5%, 4% etc." but never explain the basis for that prediction?
The reason, the 'bubbleonians' know people are discouraged from borrowing until they are confident the environment has stabilised, the less people borrow the less banks make, hence the talk about 'soft landings', 'top of the interest rate cycle', 'prices easing', 'strong employment' etc.

Zambia · 02-05-2007 8:16am

He didnt burst the bubble, but he didnt help matters at all.

The_Conductor · 02-05-2007 8:25am

Did Michael McDowell burst the housing bubble? In short- no, he didn't. Personally I don't think the mutual or common knowledge hypothesis holds water either though. The short and simple answer is that with the increases in interest rates- people simply cannot afford to borrow the amounts of money that they once were able to do and the market is rotting away both from the very top and the very bottom- just at a time when investors are trying to bail out at the top of the market.

The wait-and-see brigade are not really on the side-lines even, as the worry is that with rising interest rates their borrowing capacity will be further erroded in the very near future- so its not a case of people worried about falling asset values (though obviously this is a worry) its more a case of people simply not being able to get the money together at all- fullstop.

Sentiment has turned, yes, but if people seriously want to buy they are still doing so. The big problem, and likely to be for several years- is all those who bought their shoeboxes with the intention of trading up in the short/middle term. They are the ones who are stuck beyond all comprehension, they are the ones who need help- not the first-time-buyers (who at very least, if they have not purchased, will not have millstones of negative equity around their heads).

I see building contractors are being laid off en-mass this week? Several UK firms who supply contractors on the Dublin market are pulling out completely.

If anyone wants to build an extension wait a few weeks and you'll probably have contractors killing each other for the work.......

godtabh · 02-05-2007 9:29am

smccarrick wrote:

I see building contractors are being laid off en-mass this week? Several UK firms who supply contractors on the Dublin market are pulling out completely.

If anyone wants to build an extension wait a few weeks and you'll probably have contractors killing each other for the work.......

I work so of the biggest developers and contractors in Ireland.

At the moment one has a 1000 unit development in south county Dublin which the developer says is over subscribed before its even got full planning permission.

Another developer is in the process of sending out tenders for the construction of 10+ apartment blocks and a marina in west Dublin.

Neither has revised their expectation on these projects ie is it worth while them doing it at current rates.

They reckon that all the talk in the press is just talk and people are holding off until after the election to buy as they may save a couple of thousand in stamp duty or what ever. If developers are confident in the market then I don't think its as bleak as people make it out to be

Zambia · 02-05-2007 9:42am

kearnsr wrote:

They reckon that all the talk in the press is just talk and people are holding off until after the election to buy as they may save a couple of thousand in stamp duty or what ever. If developers are confident in the market then I don't think its as bleak as people make it out to be

Well it was stated by Wallace the Builder a while ago in the Bubble thread via a link that there is a decent business there for builders even if prices drop by 40% .

The cost of building was never a driver in the property market. Developers will just choose there targets more carefully anything in south Dublin is safe bet....

Afuera · 02-05-2007 10:22am

kearnsr wrote:

If developers are confident in the market then I don't think its as bleak as people make it out to be

In all fairness, I think that they're just putting a brace face on things. Could it be that either of the parties you've mentioned have paid a small fortune for the land, which they still need to develop before they get any kind of return?

stovelid · 02-05-2007 11:23am

Housing bubbles will always burst. That's why they are called bubbles.

It's not his fault per se. Anybody could have applied the final straw.

VoidStarNull · 02-05-2007 11:54am

No doubt the market came to halt due to a drought of buyers, caused by
intrinsics reasons such as interest rates and affordability.
But the end of a bubble is often marked not only by a buyer-drought, but
also by a selling frenzy, as potential sellers try to get out at the top.

Triggering the frenzy sometimes needs an external stimulus, as it has to
become common knowledge ("I know that you know that everyone knows..")
that the market is gone.

Is there a selling frenzy in the market today? It's hard to tell. Certainly there
is no shortage of new sellers even as unsold stock is building up. But it's hard
to see from the data if there was at any point a sudden increase in the
number of new sellers coming to market.

I'm happy to exonerate McDowell... but judging from conversations with
friends and colleagues, others are finding it convenient to blame it on him,
presumably for the reasons mentioned by Galbraith in ElGrandes post.
It's a good way to continue denying reality...

Imposter · 02-05-2007 12:19pm

McDowell or any politician is singularly not to blame if things go tits up. The people to blame are all the people who at any stage have helped the whole property circus spiral out of control in Ireland. They'd include: Estate agents, banks, developers, trader uppers, investors, first time buyers (of shoeboxes or commuting properties in particular), politicians, etc...

seamus · 02-05-2007 12:38pm

VoidStarNull wrote:

No doubt the market came to halt due to a drought of buyers, caused by intrinsics reasons such as interest rates and affordability.

There is however, a significant latent demand still in the market. This demand is being held back by the present market conditions (most notably the interest rates), but will return to the market again, if and when the conditions become more favourable. A lot of potential buyers have made short-to-medium term arrangements to weather the storm, with a view to returning to the market at a later date. Actual demand hasn't completely dried up, far from it. When the market does start to recover, I'd say we'll see an initial flurry of buying, followed by something more normal - when the market returns, there'll be much less inflation of demand from one-off investors.

While it's not possible to blame one individual for a market crash - the market was doomed to dip - there are definitely certain key groups who failed to plan in any way for what the market experienced. Most importantly, Government and County Councils, perhaps with their own monetary interests taking precedence, allowed the growth to continue uncontrolled. It is this failure to plan that has led the market to see some people potentially losing 50% of the value of their home over the next few years.

This is not a hindsight issue. I can remember being in secondary school (over ten years ago now), and seeing pictures of young couples queueing overnight to put a deposit on a house in Knocklyon. It was then that it should have been caught. Someone should have said "Right, lets plan this. Let's decide where we're going to put the houses, plan bus routes, train stations, road capacities, hospitals, schools, shops, pubs, and then have them all in place before the houses are completed." Instead, the builders and developers put pressure on the government and councillors, handed over brown envelopes for planning favours, and generally gave themselves a licence to print money by doing the typically Irish backhander thing.

If the infrastructure had been in place, we could very much still be in a market slowdown situation, but with almost all homes being equal, and thereby reducing the drop and/or the slowdown.

calsatron · 02-05-2007 3:32pm

If there was "significant" latent demand in the market then there would be heavy pressure on the rental market, which currently isn't the case.

There was a rental price spike in the last few months, more than likely due to properties being placed on the market by the investers. However prices now seem to have normalised, as these properties are placed back on the rental market.

On another note, and unrelated but interesting, there also appears to be signficant "over expectation" in the rental market as well. i.e. less desirable properties on the outskirts of the city with poor transport links renting for equivalent values to similar properties in more desirable central locations. Fitout is also universally atrocious, speaking from personal experience.

On the McDowell front, nobody will attempt to identify what caused the crash. In situations like this there is usually just universal hand wringing and sighing and talk of "Why did we not realise sooner?", "Why did we let prices get so high?", "Why did the government let things continue?". With hindsight the absurdity of the situation becomes obvious, a la the Tech Bubble a few years ago.

Raskolnikov · 02-05-2007 3:36pm

kearnsr wrote:

I work so of the biggest developers and contractors in Ireland.

At the moment one has a 1000 unit development in south county Dublin which the developer says is over subscribed before its even got full planning permission.

Another developer is in the process of sending out tenders for the construction of 10+ apartment blocks and a marina in west Dublin.

Neither has revised their expectation on these projects ie is it worth while them doing it at current rates.

They reckon that all the talk in the press is just talk and people are holding off until after the election to buy as they may save a couple of thousand in stamp duty or what ever. If developers are confident in the market then I don't think its as bleak as people make it out to be

"It's the last sting of the dying wasp" - Oh no, wait . . .

seamus · 02-05-2007 3:41pm

calsatron wrote:

If there was "significant" latent demand in the market then there would be heavy pressure on the rental market, which currently isn't the case.

Not necessarily. That would imply that the people seeking to buy, don't currently have somewhere to live. Most people looking to buy already have a place to live. By opting out of buying, they simply stay put. The rental market showed that its demand stayed pretty much constant, indicating this.

Anecdotal evidence from what I've seen, suggests that most people only rent when they have to, but choose to buy when they want to.

calsatron · 02-05-2007 3:58pm

True but all other things being equal that should increase the demand in the rental sector by a significant margin.

All sides agree that bar a recent price spike the rental market has been universally flat over the last few years indicating some level of parity between supply and demand.

Your model requires people to stay put, you also argue that given the opportunity people would buy, therefore to maintain the parity in the rental market those people who were previously buying and leaving the rental market were replaced by new entrants into the rental market.

Presuming those people are now staying put the market would still be under pressure from the new entrants, leading to price increases.

But prices aren't increasing.

The only explanation I can see is that the demand in the expanding rental sector is being met by expanded property availability. Basically more properties are being bought as buy to let and hitting the market on the back of expected capital appreciation.

DéiseGirl · 02-05-2007 4:04pm

I'm just about to buy somewhere...it's typical that I always do things at the "wrong time" but I'm not really very worried because the house is in a good location, it's a good sized four bedroom house which I could see myself staying in long term as opposed to just "buying anything to get on the ladder" and I am SICK OF RENTING/SHARING!

The repayment rates will probably rise and rise but that's just something we'll have to deal with as it happens. Can't wait to move into the house at this stage.

Zambia · 02-05-2007 4:09pm

D&#233 wrote: »

I'm just about to buy somewhere...it's typical that I always do things at the "wrong time" but I'm not really very worried because the house is in a good location, it's a good sized four bedroom house which I could see myself staying in long term as opposed to just "buying anything to get on the ladder" and I am SICK OF RENTING/SHARING! The repayment rates will probably rise and rise but that's just something we'll have to deal with as it happens. Can't wait to move into the house at this stage.

Best of luck , however personally I feel by waiting you could have your big house and pay less to boot.

calsatron · 02-05-2007 4:13pm

If your buying it as a home then its the right decision.

If your buying it as an investment then it requires a lot more thought.

Whenever crashes happen people talk about 30%,40%,50% off the market etc etc. People don't appreciate how price drops affect different sectors of the market.

Added value makes the most difference to how much any market instability will affect you. If your house is in a desirable area, near to good schools, shops and other services with strong transport links then it'll be affected least. If your house is in the middle of nowhere with no shops, no transport and no schools you just wont be able to sell it, at any price. Everything else is somewhere in between.

Speaking from personal experience of the 90's crash in the UK anyway.

Oh and don't confuse value with worth.

seamus · 02-05-2007 4:22pm

calsatron wrote:

True but all other things being equal that should increase the demand in the rental sector by a significant margin.

Well it did, very briefly, and right as the housing market began to tumble, as you agree.

Your model requires people to stay put, you also argue that given the opportunity people would buy, therefore to maintain the parity in the rental market those people who were previously buying and leaving the rental market were replaced by new entrants into the rental market.

This model requires that landlords compete. Who says they did? With high property gains, and low rental yields, exiting tenants didn't necessarily have to be replaced. Indeed, plenty of properties have lain idle for the last few years. I know a few people who have had tenants on and off, but without any desire to compete for them, the rents they charged stayed fairly flat.

Figures indicate that as much as 15% of our housing stock are unoccupied. This can easily create havoc with attempting to makes guesses about the economics of the rental market, when the housing market is fluctuating.

calsatron · 02-05-2007 4:31pm

True, but if that 15% is vacant its more likely just to be sold in a falling market than put up for rental. If it hits the rental market then that would be indicitive of continued softening of the sales market. i.e. if its empty its reliant on capital appreciation why suddenly rent it, you must either no longer confident of continuing to make a profit by leaving it idle or unable to sell it to realise your previous gains.

I'd agree with you though that speculation on the rental market is largely pointless due to vast fluctuations in both demand and supply from day to day.

I'd say the only thing you can say with a degree of certainty is that currently and in the recent past supply has kept pace with demand.

The_Conductor · 02-05-2007 5:54pm

D&#233 wrote: »

I'm just about to buy somewhere...it's typical that I always do things at the "wrong time" but I'm not really very worried because the house is in a good location, it's a good sized four bedroom house which I could see myself staying in long term as opposed to just "buying anything to get on the ladder" and I am SICK OF RENTING/SHARING! The repayment rates will probably rise and rise but that's just something we'll have to deal with as it happens. Can't wait to move into the house at this stage.

Providing your finances are such that you are not unduly pressurised by a 1% increase in interest rates- then my congratulations to you. If you would be put in an unbearable position with a 1% rise in rates- seriously advise you sit down and reappraise what you are doing. A decent sized 4 bed that you can see yourself living in longterm sounds nice!

VoidStarNull · 02-05-2007 9:00pm

calsatron wrote:

True, but if that 15% is vacant its more likely just to be sold in a falling market than put up for rental. If it hits the rental market then that would be indicitive of continued softening of the sales market. i.e. if its empty its reliant on capital appreciation why suddenly rent it, you must either no longer confident of continuing to make a profit by leaving it idle or unable to sell it to realise your previous gains.

I'd agree with you though that speculation on the rental market is largely pointless due to vast fluctuations in both demand and supply from day to day.

I'd say the only thing you can say with a degree of certainty is that currently and in the recent past supply has kept pace with demand.

See this article from bloomsberg today on the US market:

http://www.bloomberg.com/apps/news?pid=20601109&sid=asLI7aWzN8Jc&refer=home

Apparently unsold units left over the boom are only now putting pressure
on rents. Granted their situation is not identical with ours, but this shows
it can take time for problems in the market to feed through to declining
rents.

The comment from one speculator-turned-reluctant-landlord, that he
refuses to sell for less than he paid, also shows how the pace of price
declines can be limited by seller reluctance. However this eventually
translates into increased downward pressure on rents.

pjbrady1 · 02-05-2007 11:01pm

While it might be alot easier to sell property in good locations (shops,pubs, transport, etc). These properties still have the potential to fall by the exact same % as shoeboxes in bad locations.
Currently nice properties in good locations have (had even higher) extremely high prices. As sellers start to compete in these areas to sell property then large scale price reductions will set in.
It is pretty common to have 10% price reductions in most parts of Dublin at this stage. So add another interest rate rise, add in more continuous headlines about a falling market and we will see selling on a scale not yet witnessed. This easily has the potential to bring well located properties off their current prices by 30%+. Something people think implausible.
Smart people who act decisively when it comes to money own alot of Dublins expensive property. They are the first people who will try and exit the market.

VoidStarNull · 03-05-2007 12:15pm

If you look at Daft's website, you'll notice they report on the front page both the
total number of properties listed (for sale+rent), and the number added in the
last 24 hours.

I thought I'd check out their past statistics using the wayback machine
(www.archive.org) to see if there's any pattern in the number added.
Unfortunately the machine only has data up to April 2006 at present (the peak
of the market, anecdotally), but more will be added in future months.

See attached pic. Note the large increase in mid 2005 is due to Daft adding
a large block of foreign properties to their site en masse. The sharp fall at the
start of 2006 may be a similar articial adjustment.

Anyway it looks there is the beginning of a ramp in both number added per day
and total backlog towards the middle of 2006. Clearly McDowell can't be
blamed for the start of the new trend! More data will produce a fuller picture
over the next few months.

Another thing to note: the turnover in the market during the boom years was
around 5000 properties (rent+sale) per day. If you've been looking at Daft's
site recently, you may noticed that around 15,000 properties are being added
per day. There never, ever was a market for 15,000 properties per day in
Ireland, even at the height of the boom.

Buyer discouragement may have started the new trend, but it is now being
driven by a seller frenzy. Stamp duty changes will have zero impact. Even if
all the buyers came back, properties are being added at a rate 3 times greater
than the market can absorb at stable prices.

whizzbang · 03-05-2007 12:46pm

VoidStarNull wrote:

Another thing to note: the turnover in the market during the boom years was
around 5000 properties (rent+sale) per day. If you've been looking at Daft's
site recently, you may noticed that around 15,000 properties are being added
per day. There never, ever was a market for 15,000 properties per day in
Ireland, even at the height of the boom.

to be fair I think those numbers are a little off, when people renew their ad (to bump it to the top of the search list) it gets counted as a "new property added".
Check out daftwatch to get an idea of the genuine figure (still a scary graph)
http://daftwatch.atspace.com/

VoidStarNull · 03-05-2007 1:03pm

whizzbang wrote:

to be fair I think those numbers are a little off, when people renew their ad (to bump it to the top of the search list) it gets counted as a "new property added".

Hmm.. good point. I guess turnover of 5000 per day and a backlog of 10000
(in 2004) would imply that properties were only staying on the site for 2 days,
which seems short!

Can we conclude that sellers are 3 times as nervous today as 2 years ago?

whizzbang · 03-05-2007 1:22pm

VoidStarNull wrote:

Hmm.. good point. I guess turnover of 5000 per day and a backlog of 10000
(in 2004) would imply that properties were only staying on the site for 2 days,
which seems short!

Can we conclude that sellers are 3 times as nervous today as 2 years ago?

yep I'd go with that! and that they need to bump their houses up the list 3 times as often as the supply has tripled!

VoidStarNull · 03-05-2007 4:03pm

In fact the numbers look like this:

TODAY: 90,000 listed properties, 15,000 updates per day
2 YEARS AGO: 10,000 listed properties, 5,000 updates per day

So the number of updates per property has declined...
Looks like the estate agents are slacking off!

whizzbang · 03-05-2007 4:12pm

VoidStarNull wrote:

In fact the numbers look like this:

TODAY: 90,000 listed properties, 15,000 updates per day
2 YEARS AGO: 10,000 listed properties, 5,000 updates per day

So the number of updates per property has declined...
Looks like the estate agents are slacking off!

or maybe they have to go out and actually work to sell the property rather than just hitting refresh on daft

VoidStarNull · 03-05-2007 8:20pm

OK, here's another attempt to get some sense out of these numbers.
What I'm trying to figure out here is whether the current market is being
determined by a dearth of buyers (which might be fixed temporarily by
handing out cash to FTBs) or an excess of sellers (which nobody is proposing
to fix).

Back in 2004 the number of properties for sale or rent on Daft was
relatively stable at about 12,000. If we make a reasonable guess that they
stayed on the site for say 3 months before being sold/rented/withdrawn, then
turnover was about 4000 units per month. Prices were rising steadily so
throughput would probably have been a bit higher with stable prices.

If we look at daftwatch today (thanks for the link whizzbang) we can see
that the number for sale or rent has increased at a rate of about 3000 per
month since January.

If buyers have declined dramatically, so that only around 1000 are being
sold/rented per month, then the rate at which properties are being
newly-offered would be about 4000 per month, same as in 2004.

That would imply that buyers have declined 75% since 2004. A less steep
decline would mean that the number of new sellers must be
increasing - if there are still 4000 sold / rented per month then 7000 properties
are being newly offered per month.

So it's inconclusive. Estate agents of course must have the real numbers on
this. Are there any friendly estate agents out there who would care to
(anonymously) offer an opinion?

DéiseGirl · 10-05-2007 6:34pm

smccarrick wrote:

Providing your finances are such that you are not unduly pressurised by a 1% increase in interest rates- then my congratulations to you. If you would be put in an unbearable position with a 1% rise in rates- seriously advise you sit down and reappraise what you are doing. A decent sized 4 bed that you can see yourself living in longterm sounds nice!

Have done the sums and it works out OK. Obviously would rather not have to factor in the 1% (or more) rise, but that's wishful thinking. :rolleyes:

ray vaughan · 15-05-2007 12:36pm

check out the web site www.irishpropertywatch.com - it lists all the price drops on Myhome on a fortnightly basis. it takes two snap shots of the properties listed over time and compares the price changes. i really like the entry which describes the house as a 'pre-election sale' - classic!

Did Michael McDowell burst the housing bubble?

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