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Why bother investing in Ireland?

24567

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  • #32
    maninasia
    Registered Users, Registered Users 2 Posts: 4,635 ✭✭✭maninasia


    Euroland wrote: »
    1) O, yes, I do.



    2) Apparently someone just needs to get access to residential property prices and household income levels across the world. Once you have it, you would realize that our residential property now is undervalued.

    What about average levels of personal debt, Ireland's doing pretty well in that department, coming among first in the world. Still think houses are 'undervalued'?


  • #33
    Count Dooku
    Registered Users, Registered Users 2 Posts: 2,419 ✭✭✭Count Dooku


    Euroland wrote: »
    1) O, yes, I do.



    2) Apparently someone just needs to get access to residential property prices and household income levels across the world. Once you have it, you would realize that our residential property now is undervalued.
    you missed in your equation demand, which depends from number of new jobs created and supply(in our case oversupply)
    sorry for off-topic
    not_i.gif


  • #34
    murphaph
    Registered Users, Registered Users 2 Posts: 19,039 ✭✭✭✭murphaph


    Euroland wrote: »
    Apparently someone just needs to get access to residential property prices and household income levels across the world. Once you have it, you would realize that our residential property now is undervalued.
    ...or more likely that our income levels are overvalued ;)


  • #35
    gigino
    Closed Accounts Posts: 2,350 ✭✭✭gigino


    danbohan wrote: »
    undervalued residential property,?



    do pray tell where this is , i have seen nothing yet that makes me think we have good value in property for a country depending on the kindness of strangers /germans

    Leitrim for example. Look up daft.ie and you will find newly finished 2-bedroom apartments for 40 grand. Which, to put this amount of money in context in Ireland, is 7 grand less than average public sector wage. ( statistics for the private sector are harder to quantify / can be more complicated or open to question.)

    Yes, definitely is undervalued residential property compared to wages


  • #36
    rumour
    Closed Accounts Posts: 836 ✭✭✭rumour


    Permabear wrote: »
    This post had been deleted.

    I would think about my family and decide they can't even get a decent education there. That believe it or not is a major major issue.
    If this aspect is not good the CEO will look elsewhere.


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  • #37
    Euroland
    Closed Accounts Posts: 634 ✭✭✭Euroland


    murphaph wrote: »
    ...or more likely that our income levels are overvalued ;)

    1) Usually affordability of residential property is measured as the ratio of average property price to the average gross household income, and could be done on national, regional, or individual (property) basis. From one country to another this ratio usually varies between 2 and 40 years. Although pessimists usually say that 3 years is the only reasonable level one property should cost, in practice, in most of the countries this ratio for many decades remains between 4 to 20 years. So going back to Ireland, now (after collapse in residential property prices) you can find a lot of individual properties, which would be on a level of 1 to 3 average annual gross household incomes, and the average for the country now declined to 3.5 years, which in my view indicates that relatively to other countries in the world, our residential properties, after 50-60% decline in price, became undervalued.

    2) According to CSO, average annual gross household income in Ireland in 2009 was 56,522 Euro


  • #38
    maninasia
    Registered Users, Registered Users 2 Posts: 4,635 ✭✭✭maninasia


    Count Dooku mentioned 'over supply'. Something has no value unless there is a market for it. Large areas of the country have ghost estates that have essentially no long-term value. Just like the 40k apartment you mention in Leitrim. Maybe that is one of a complex, are the others going to be unoccupied and vandalised, will they put refugees in the other apartments? Whose going to pay for maintenance and upkeep of the whole complex? Can you get a job in Leitrim? How about property tax? Yes there are people who can pay 40k for this apartment but how many want to actually buy one?


    Then using public sector wages...how solid is the public sector these days, as solid as the budget that pays for it right.

    There is no single property market, just houses in varying states and size and varying locations. Useless to look at statistics that amalgamate everything into an average! Ireland had by any account the world's biggest property bubble. To put it into context, the bust, mainly caused by property speculation, will cost 190 billion Euro, equivalent to the cost for compensation and reconstruction for Japan's earthquake and tsunami!

    Finally stop ignoring the problems of personal debt and access to credit. Although personally I think limiting credit is a good thing as it is the fuel to any speculative bubble.


  • #39
    maninasia
    Registered Users, Registered Users 2 Posts: 4,635 ✭✭✭maninasia


    rumour wrote: »
    I would think about my family and decide they can't even get a decent education there. That believe it or not is a major major issue.
    If this aspect is not good the CEO will look elsewhere.

    CEOs of large organisations will send their kids to top private schools on the company largesse, either in their host country or home country. That is not really a concern for them and their kids would probably take the curriculum of their home country, not the leaving certificate.


  • #40
    rumour
    Closed Accounts Posts: 836 ✭✭✭rumour


    I agree Twhat you say is the most probable outcome. But it is a major issue, most CEO's on a personal level consider this first.
    I agree about the leaving certificate. The few people I know are all slightly dubious about the leaving certificate so anecdotally I agree, alternative options in Ireland are extremely limited. Dublin has only one or two schools doing the international bac.
    That leaves boarding school, and while it may offer a solution its a parental decision. Assuming that all CEO's are satisfied with this is a big assumption.


  • #41
    danbohan
    Closed Accounts Posts: 1,914 ✭✭✭danbohan


    Amhran Nua wrote: »
    Depending on the greed of same, you mean. A loan is not a gift.

    beggars cant be choosers !


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  • #42
    ei.sdraob
    Closed Accounts Posts: 9,364 ✭✭✭ei.sdraob


    gigino wrote: »
    Leitrim for example. Look up daft.ie and you will find newly finished 2-bedroom apartments for 40 grand. Which, to put this amount of money in context in Ireland, is 7 grand less than average public sector wage.

    How many public servants work in Leitrim? last I check decentralisation failed and many wanted stay in Dublin.

    More importantly how much is a house on a floodplain worth? more a liability than an asset, I thought that lesson would be freesh in memory of people after floods.


  • #43
    danbohan
    Closed Accounts Posts: 1,914 ✭✭✭danbohan


    gigino wrote: »
    Leitrim for example. Look up daft.ie and you will find newly finished 2-bedroom apartments for 40 grand. Which, to put this amount of money in context in Ireland, is 7 grand less than average public sector wage. ( statistics for the private sector are harder to quantify / can be more complicated or open to question.)

    Yes, definitely is undervalued residential property compared to wages

    yes it seems good value but ,it is in an unfinished estate , nobody can get mortgage on them probably , they cannot be rented so in effect they are valueless . apartments in carriicj on shannon that sold at 325k + are now selling for 90k , cheap ? , rent is 250-300 per month and falling if you can rent them annual rent x14 = 47k , still a ways to go


  • #44
    murphaph
    Registered Users, Registered Users 2 Posts: 19,039 ✭✭✭✭murphaph


    danbohan wrote: »
    yes it seems good value but ,it is in an unfinished estate , nobody can get mortgage on them probably , they cannot be rented so in effect they are valueless . apartments in carriicj on shannon that sold at 325k + are now selling for 90k , cheap ? , rent is 250-300 per month and falling if you can rent them annual rent x14 = 47k , still a ways to go
    This is a better measure of property value than comparing it to household income, but owing to certain govt interference, the true value of Ireland's housing stock has not yet been reached. As you say, still a ways to go.


  • #45
    ei.sdraob
    Closed Accounts Posts: 9,364 ✭✭✭ei.sdraob


    To point at an appartment in Leitrim in a ghost estate and come to conclusion that property in Ireland is "undervalued" is a failure of logic and strawman at worse

    the last Daft report tells a different story > http://www.daft.ie/report/ronan-lyons-2010q4


  • #46
    Euroland
    Closed Accounts Posts: 634 ✭✭✭Euroland


    ei.sdraob wrote: »
    To point at an appartment in Leitrim in a ghost estate and come to conclusion that property in Ireland is "undervalued" is a failure of logic and strawman at worse

    the last Daft report tells a different story > http://www.daft.ie/report/ronan-lyons-2010q4

    The opposite, this report (the numbers in it) actually suggest that Irish residential property has been undervalued already for some time.


  • #47
    Euroland
    Closed Accounts Posts: 634 ✭✭✭Euroland


    maninasia wrote: »
    How about property tax?

    What property tax?


  • #48
    ei.sdraob
    Closed Accounts Posts: 9,364 ✭✭✭ei.sdraob


    Euroland wrote: »
    The opposite, this report (the numbers in it) actually suggest that Irish residential property has been undervalued already for some time.

    undervalued by what measure :confused:


  • #49
    Euroland
    Closed Accounts Posts: 634 ✭✭✭Euroland


    maninasia wrote: »
    Ireland had by any account the world's biggest property bubble.

    How about Australia and Norway then? The property prices over there almost twice above ours. How about Singapore or Hong Kong?


  • #50
    Euroland
    Closed Accounts Posts: 634 ✭✭✭Euroland


    ei.sdraob wrote: »
    undervalued by what measure :confused:

    On average at least by 10-20%, maybe more. On the individual basis it could be even more, and then you have to go to the details.


  • #51
    Euroland
    Closed Accounts Posts: 634 ✭✭✭Euroland


    danbohan wrote: »
    yes it seems good value but ,it is in an unfinished estate , nobody can get mortgage on them probably , they cannot be rented so in effect they are valueless . apartments in carriicj on shannon that sold at 325k + are now selling for 90k , cheap ? , rent is 250-300 per month and falling if you can rent them annual rent x14 = 47k , still a ways to go

    I’m not talking about that particular estate, I’m talking about overall picture, our residential properties are undervalued relatively to many other countries in the world.

    As regards to the rent, relatively to many other countries in the world, our residential rents are very low (as a proportion of average household income).


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  • #52
    ei.sdraob
    Closed Accounts Posts: 9,364 ✭✭✭ei.sdraob


    Euroland wrote: »
    How about Australia and Norway then?
    countries rich in natural resources, experiencing a resource export boom and property bubble in australia

    Euroland wrote: »
    How about Singapore or Hong Kong?
    highly industrialized and successful city states with a regulated property market

    Euroland wrote:
    On average at least by 10-20%, maybe more. On the individual basis it could be even more, and then you have to go to the details.

    You didnt answer the question
    What makes you think that property should be worth 10-20% more, what measure are you basing your assumptions on.
    Is it rental yield, building costs, cheap credit, finger in the air or because you say so...?


    Euroland wrote: »
    As regards to the rent, relatively to many other countries in the world, our residential rents are very low (as a part of average household income).

    You keep repeating this claim like a broken record but have not bothered to create a thread and provide any evidence, facts or figures to support your thesis
    i started plenty of threads in this forum and always have some figures to backup my point of view in the OP


  • #53
    Count Dooku
    Registered Users, Registered Users 2 Posts: 2,419 ✭✭✭Count Dooku


    Euroland wrote: »
    How about Australia and Norway then? The property prices over there almost twice above ours. How about Singapore or Hong Kong?
    Do they have so big unemployment ?
    Property prices depends only from number of jobs created
    When unemployment was falling, prices grew, not it will work opposite way


  • #54
    Euroland
    Closed Accounts Posts: 634 ✭✭✭Euroland


    For example this property is undervalued:

    http://www.daft.ie/searchsale.daft?id=580928

    and this as well:

    http://www.daft.ie/searchsale.daft?id=576123


  • #55
    Euroland
    Closed Accounts Posts: 634 ✭✭✭Euroland


    Count Dooku wrote: »
    Do they have so big unemployment ?
    Property prices depends only from number of jobs created
    When unemployment was falling, prices grew, not it will work opposite way

    1) I’m talking about income affordability

    2) Yes, Unemployment plays important part, however even in countries with higher unemployment property market didn’t collapse as much as it happened in Ireland. In those countries there was noone to undermine local property market as it has been happening here.


  • #56
    Euroland
    Closed Accounts Posts: 634 ✭✭✭Euroland


    ei.sdraob wrote: »
    countries rich in natural resources, experiencing a resource export boom and property bubble in australia

    highly industrialized and successful city states with a regulated property market

    Ha-ha, now you are trying to find some exceptions to your rule. Then please don’t forget that Ireland is one of the 5 strongest exporters in the world.


  • #57
    ei.sdraob
    Closed Accounts Posts: 9,364 ✭✭✭ei.sdraob


    Euroland wrote: »
    1) I’m talking about income affordability

    the average house price nationwide is over 5x the average industrial wage


    Euroland wrote: »
    2) Yes, Unemployment plays important part, however even in countries with higher unemployment property market didn’t collapse as much as it happened in Ireland. In those countries there was noone to undermine local property market as it has been happening here.

    you have things arseways

    unemployment didnt lead to house price crashes in ireland, the construction sector was in decline since 2007 due to them overbuilding, most of the newly unemployed came from construction and anything related to it as per CSO :(


  • #58
    Euroland
    Closed Accounts Posts: 634 ✭✭✭Euroland


    ei.sdraob wrote: »
    You didnt answer the question
    What makes you think that property should be worth 10-20% more, what measure are you basing your assumptions on.
    Is it rental yield, building costs, cheap credit, finger in the air or because you say so...?

    Our income, levels. And 10-20% is the minimum; maximum could as high as 30-40%.


  • #59
    Euroland
    Closed Accounts Posts: 634 ✭✭✭Euroland


    ei.sdraob wrote: »
    the average house price nationwide is over 5x the average industrial wage

    Are you working in industry? Nobody measures relatively to the industrial wage (as most of us work outside industry and many have 2 incomes per household), the most common measurement in the world is the average gross household income, which in Ireland in 2009 was 56,522 Euro per year. Based on it we stay only at around 3.5, which is very low relatively to most of the countries in the world.


  • #60
    Euroland
    Closed Accounts Posts: 634 ✭✭✭Euroland


    ei.sdraob wrote: »
    you have things arseways

    unemployment didnt lead to house price crashes in ireland, the construction sector was in decline since 2007 due to them overbuilding, most of the newly unemployed came from construction and anything related to it as per CSO :(

    You started with unemployment and now are trying to escape from your own argument ;)


    BTW, How about New Zealand, China, or Morocco, where this multiple more than twice above ours? Or Eastern European/CIS countries?


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  • #61
    Count Dooku
    Registered Users, Registered Users 2 Posts: 2,419 ✭✭✭Count Dooku


    Euroland wrote: »
    1) I’m talking about income affordability
    Everybody who can afford a house already bought one
    Euroland wrote: »
    2) Yes, Unemployment plays important part, however even in countries with higher unemployment property market didn’t collapse as much as it happened in Ireland. In those countries there was noone to undermine local property market as it has been happening here.
    There is no so massive oversupply in another countries as we have in Ireland


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