Morgan Kelly on property: "we are very far from the bottom"

dpe · 08-08-2011 12:06PM

I'm on a decent salary (six figures) and I know for a fact that I wouldn't get a mortgage big enough to buy anything decent at current prices, and that even if I could, I'd be stupid to take it, because more tax rises, and rate rises, are inevitable, and a cursory look on Daft tells you prices are still unrealistic, despite huge drops, and that further huge drops will be necessary. The only alternative is to destroy the excess supply of housing stock, which isn't going to happen.

I'll actually be surprised if I ever buy a house in the Irish market. Problem is the quality of housing stock in the rental market is pretty sucky.

BostonB · 08-08-2011 12:20PM

You could approach owners of those empty new houses, if they'd be interested in renting.

anto2 · 08-08-2011 12:20PM

>>I'm on a decent salary (six figures)<<

Just save half that and you could buy a decent but modest house in Dublin in 3 years time ,or a nice bungalow on half an acre in Culchie land .

iPlop · 08-08-2011 12:20PM

You see the big issue is people getting mortgages.Ireland has very few permenent jobs left, it's all contract work.All my fiends that are still working have had their T&C's changed by their employer, obviously with a pay off (think Aer lingus last year) this is happening all over Ireland in nearly every company.

They come back on new terms but are not permenent , but could be there for 10 or 20 years.

The requirement for a mortgage is a "permenent" job.So the housing market is far from the bottom IMO, unless people start getting full time permenent jobs again.

El Sorab · 08-08-2011 12:22PM

With property tax coming in you are no longer buying a house just the right to rent it from the government.

and the rent the government charges can (and will) go up at any time depending on how badly they need the money for their overpaid public servants, cronies and daft schemes they feel the need to throw money at

dpe · 08-08-2011 12:30PM

BostonB wrote: »

You could approach owners of those empty new houses, if they'd be interested in renting.

Thought's crossed my mind (not on one of those always-going-to-be-empty estates though).

anto2 wrote: »

>>I'm on a decent salary (six figures)<<

Just save half that and you could buy a decent but modest house in Dublin in 3 years time ,or a nice bungalow on half an acre in Culchie land .

I think Mr. Taxman might object to me keeping the half of my salary I'm currently giving to him for myself.

amacca · 08-08-2011 12:33PM

dpe wrote: »

I think Mr. Taxman might object to me keeping the half of my salary I'm currently giving to him for myself.

yeah...hes a pernickety old bean counter all right.

thebigbiffo · 08-08-2011 12:39PM

Killer Pigeon wrote: »

Who care.

In 2 hours the markets are going to open after the weekend and the world will end.

This has been a weekend in which the US credit rating was downgraded and in which an Italian & Spanish bailout has become apparent.

Basically the world will fall apart in 2 hours (1am Irish time).

the wheels of capitalism continue to roll...

the sky is falling the sky is falling!! :P

joseph brand · 08-08-2011 02:19PM

washman3 wrote: »

Dionysus, well said. that is one of the best posts i've ever read on BOADRS.IE
Kelly has been correct from day 1 and he's still correct. he is, like McWilliams, now a hated figure in the media and property circles. they have upset the cosy cartel involving developers,speculators,regulators, bankers and politicians. Most of us always knew that NAMA is a total scam designed to save the contributors of the Galway Tent, at the enormous cost to the ordinary person. if this scam can be kept going for a few years there is a chance that these scum will recoup what they have "lost".
the plan was to shelve these properties for 10yrs approx,hope that the market would recover and start selling again. this of course was ludricious and now our European paymasters and the IMF see through this scam.
I firmly believe that the current NAMA firesale was ordered by the Troika.
A lot of the truth had been hidden.
FF/GREENS and the GOMBEENS colluded to keep property prices up and the present Government is doing little to change this. Hopefully their hand will be forced even more by the Troika.
We need to see the greedy individuals that caused this mess to be punished. have we seen any of these people on a dole queue yet.? No.!
Instead, a Sunday paper today has revealed a list that have "retreated" to
the Algarve.
These people are no better than those who are "exiled" yet manage to send huge shipments of drugs into Ireland.
We are hearing thrash like, "we are where we are", "we all partied", "time to move on" etc. This is code for,"let those who caused this walk away scot-free"
Amazingly we will still have apoligists (vested interests) having a go at people like you and me when we post comments here, but like the Troika we can now see through these poor deluded souls.
Morgan Kelly said in 2008 that house prices would fall 90%.
We are rapidly heading that way,so have no qualms about renting for now. you WILL be rewarded for being prudent during the "boom".!!!

Link to this list please. If anyone's got it.

mathie · 08-08-2011 02:56PM

Voodoomelon wrote: »

I went in for a mortgage over the last few months, a mortgage totaling x3 times my salary. Bank said no. We are absolutely f**ked.

Did you have a deposit?

BostonB · 08-08-2011 03:03PM

Voodoomelon wrote: »

I went in for a mortgage over the last few months, a mortgage totaling x3 times my salary. Bank said no. We are absolutely f**ked.

Around 2000, the lending criteria for all banks (AFAIK) was 2.5x one salary + 1 other salary. That was the norm.

ScumLord · 08-08-2011 03:28PM

The monetary system, banks, national debt and all the rest of it is a complete farce at this stage. I'm sure people will look back at this time in history, one of unparalleled technology and knowledge and wonder what the hell was wrong with us that we couldn't see how obviously we're being rode by the people in charge of the monetary system.

The problem is we're to invested in this system and it would take a majority to overturn it's hold on power.

phill106 · 08-08-2011 04:36PM

The-Rigger wrote: »

What is your point, that we could have spent it launching a space shuttle? Space shuttles are also a massive waste of money.

Ha, just wait till i get my moon housing estate business going!

Blackpitts · 08-08-2011 04:46PM

RantingRichie wrote: »

We're a shamefully passive race - any other country would be on the streets.

nah, you have not been in Italy then...

foxyboxer · 08-08-2011 05:41PM

I'd liken the property boom in Ireland to Italia 90.

People got swept up in the euphoria of Ireland qualifying for the finals.
Despite the fact that most of the squad were so called plastic paddy's and the manager was an englishman. A manager who insisted on incredibly ugly tactics which consisted of putting em under pressure and having Bonner lobbing up high balls to Cascarino or Quinn and feeding off the scraps. (the thoughts of having to watch the 120 minutes of Ireland-Romania again fill me with dread :eek:)

All the while Eamon Dunphy on the RTE panel (Morgan Kelly et al in this analogy) repeatedly pointed out these negative tactics and pleaded the case for playing 'football'. He was subsequently vilified by people and the media for wrecking people's buzz.

Solnskaya · 08-08-2011 06:28PM

and its 10 times annual rent, annual rent*10= correct price of a house. A long way to go yet boys and girls.

Voodoomelon · 08-08-2011 06:33PM

mathie wrote: »

Did you have a deposit?

18% deposit and a 10% contingency for the proposed works. Still no. Absolute bastards to deal with , BOI by the way, took 2 months to get an answer.

7sr2z3fely84g5 · 08-08-2011 06:33PM

Theres still wealth out there,the banks still want to get those wealthy people to buy,back to the boom times.

Does anyone remember the banking adverts during the boom encouraging young couples to get their parents to re-mortgage their house to get them on the property ladder.

the groutch · 08-08-2011 06:56PM

But Eddie Knob Hobbs said.................

Jesus Wept · 08-08-2011 10:55PM

phill106 wrote: »

Ha, just wait till i get my moon housing estate business going!

Coincidently, I have some moon land for sale on adverts.

wil · 09-08-2011 12:11AM

The-Rigger wrote: »

Coincidently, I have some moon land for sale on adverts.

And some right lunatics replying.
Have you considered renting?

Jesus Wept · 09-08-2011 02:55AM

I am open to a long term lease if a suitable tenant could be found.

Hunchback · 09-08-2011 03:17AM

Sungodbr wrote: »

The US Dollar was created by the many different states that varied economically that made up the USA at the time, the thing is it was not a flawless process, there was a lot of trial and error when they created the Dollar, it failed a number of times and it took them nearly 100 years to get it to work, the Euro will also take a long time to work properly but it will probably be the reserve currency for the planet in the future

The Euro is not just based on the ideals of unity and solidarity but on the premise that it is the best way to make Europe competitive against the emerging powers of India, China, Brazil etc, it has a sound economic purpose

you don't believe it's doomed to failure????????

Hunchback · 09-08-2011 03:49AM

sorry, one question mark should have been sufficient

NIMAN · 09-08-2011 04:11AM

Solnskaya wrote: »

and its 10 times annual rent, annual rent*10= correct price of a house. A long way to go yet boys and girls.

I rent a good quality 3 bed semi for €480/month.
By your calculations do you reckon that its only worth €57600?
Seems a bit low imho. I reckon if I put it on the market tomorrow for €80k it would sell before the end of the week.

And with the growing rumours about rental allowance being cut in Decembers budget, say for example that my tenant only could pay me €400 per month, does that put my house price at €48,000?

If thats the real value of property in this country, then lot of people who aren't currently in bother are going to be.

Sungodbr · 09-08-2011 07:38AM

CKonetheonlyone wrote: »

you don't believe it's doomed to failure????????

I think it is too early for anybody except the cryptic speaking Dr Angela Merkel to answer this question with full confidence, from history we should learn never to underestimate German resolve and determination to complete a task.... often pushing the envelope to serious extremes as to how far they will go to achieve the goals they have set for themselves..... if they want they could probably drag the whole of the Eurozone through this crisis and out the the other side, the question is do they really want to....

washman3 · 09-08-2011 12:02PM

NIMAN wrote: »

I rent a good quality 3 bed semi for €480/month.
By your calculations do you reckon that its only worth €57600?
Seems a bit low imho. I reckon if I put it on the market tomorrow for €80k it would sell before the end of the week.

And with the growing rumours about rental allowance being cut in Decembers budget, say for example that my tenant only could pay me €400 per month, does that put my house price at €48,000?

If thats the real value of property in this country, then lot of people who aren't currently in bother are going to be.

In 2008 David McWilliams had a formula that valued a 3 bed semi at €120k
He based his figures on retal figures x 12-14yrs and added a sum to allow for various locations. for his formula he chose Oranmore,Galway.
He predicted a 40-50% property price drop and also stated that property prices would possibly overshoot downwards in a recession as they did massively during the "boom".
We must remember that the "boom" was an absolute farce,cheerleaded by the government,vested interests and the media so a 3 bed semi was never worth anything near the asking prices at the time. Mass public hysteria prevailed, so we should'nt even bother comparing prices now with prices then.
In the immortal words on Ben Dunne,that shrewd businessman, "the value of something is what you get when you have to sell it"
So far the developers have not been forced to sell as they have been protected by the past and present governments and NAMA but its now become increasingly obvious that the Troika have wised up to this dirty scam and ordered NAMA to start selling.

jimthemental · 09-08-2011 12:06PM

Ah recession threads:) I'm in Melbourne, I no longer care. Except for the ****e beer here of courses

RedXIV · 09-08-2011 12:11PM

NIMAN wrote: »

I rent a good quality 3 bed semi for €480/month.
By your calculations do you reckon that its only worth €57600?
Seems a bit low imho. I reckon if I put it on the market tomorrow for €80k it would sell before the end of the week.

And with the growing rumours about rental allowance being cut in Decembers budget, say for example that my tenant only could pay me €400 per month, does that put my house price at €48,000?

If thats the real value of property in this country, then lot of people who aren't currently in bother are going to be.

In fairness, my dad bought his first house, a 3 bed bungalow for 35K when I was alive so its not that ridiculous when you look at what house prices WERE. I'm still hearing from my mate about his dad who bough his house for 5K years and years ago and sold it for just over 100K in 2000. property prices were absolutely ridiculous

CorkMan · 09-08-2011 12:14PM

RedXIV wrote: »

In fairness, my dad bought his first house, a 3 bed bungalow for 35K when I was alive so its not that ridiculous when you look at what house prices WERE. I'm still hearing from my mate about his dad who bough his house for 5K years and years ago and sold it for just over 100K in 2000. property prices were absolutely ridiculous

My Dad got his house for €2k back in 1976, at the peak it would have been worth over €200k. He was paying a fiver a week until 2001 :pac: (3 bedroom semi)

Morgan Kelly on property: "we are very far from the bottom"

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