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Property Market 2015

handlemaster

http://m.independent.ie/business/personal-finance/property-mortgages/return-of-property-porn-as-prices-go-through-the-roof-30857063.html

What are your predictions for 2015 property market both rental and sales.

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waxon-waxoff

There are three houses ive viewed in the last two weeks or so that the EA says were sale agreed a few months ago but it fell through for whatever reason. They now have asking prices about 10% less than what the sale agreed price was a few months back.
Whats unusual is that the EA have called me back after a viewing asking was i interested. This has never happened before.

gosplan

waxon-waxoff wrote: »

There are three houses ive viewed in the last two weeks or so that the EA says were sale agreed a few months ago but it fell through for whatever reason. They now have asking prices about 10% less than what the sale agreed price was a few months back.
Whats unusual is that the EA have called me back after a viewing asking was i interested. This has never happened before.

Can I ask what area this was?

Jet Black

Went to my first open view yesterday and within 5 minutes agent said he had an offer 10k above asking. There were only two other couples there. As I was leaving he asked me if I was going to top it. Just said I'll have a think about it. He said I should get back by Monday as it will be gone.

The place needed to be gutted and any cash you put in you wouldn't be getting back. Biggest appeal was the price and no way was I going to be in a bidding war for it.

waxon-waxoff

gosplan wrote: »

Can I ask what area this was?

Dublin 7+8. Three different EA. Low price house's all needing some modernising. Seller's must be eager to sell at this stage.

gaius c

Jet Black wrote: »

Went to my first open view yesterday and within 5 minutes agent said he had an offer 10k above asking. There were only two other couples there. As I was leaving he asked me if I was going to top it. Just said I'll have a think about it. He said I should get back by Monday as it will be gone.

The place needed to be gutted and any cash you put in you wouldn't be getting back. Biggest appeal was the price and no way was I going to be in a bidding war for it.

Ah so they deliberately priced low in order to get interest? Not completely unreasonable in that context.

LOL at the lad bidding money on a place they've set eyes on first time ever and the EA trying to encourage others to do likewise. It's like buying off the plans without even the reassurance of buying off a builder. Even after two viewings on any property, I'd be doing further research on top to make sure it's not a lemon.

handlemaster

gaius c wrote: »

Ah so they deliberately priced low in order to get interest? Not completely unreasonable in that context.

LOL at the lad bidding money on a place they've set eyes on first time ever and the EA trying to encourage others to do likewise. It's like buying off the plans without even the reassurance of buying off a builder. Even after two viewings on any property, I'd be doing further research on top to make sure it's not a lemon.

you can tell alot from just one viewing, particularly if you know the house type and you have been looking for a while. Also if a house needs work you just price that into your offer.

alastair

gaius c wrote: »

Actually, the 20% rule is for non-first time buyers.
First time buyers only need a 10% deposit up to €220k.
So your thesis is completely invalid.

There's an additional group of buyers for those houses then - First time buyers with their 10% deposit arrangements. <SNIP>

Villa05 wrote: »

Point 5 Interest rate cycle is beginning to change, US expected to increase this year. Ireland has the highest rates because of our immaturity and inability to deal with bad debts. This has to be priced into new mortgages

The bank's clearly don't think so, or they've decided to be unusually generous in their long term fixed rate deals. Given their history of generosity to borrowers, it's safe to deduct that they've decided that the variable is likely to drop in the medium term.

Villa05

alastair wrote: »

The bank's clearly don't think so, or they've decided to be unusually generous in their long term fixed rate deals. Given their history of generosity to borrowers, it's safe to deduct that they've decided that the variable is likely to drop in the medium term.

Not so much generous. These are teasers to keep their existing good customers and prize some away from other banks. They know there is a limited pool of prospective new FTB so to get new customers they have to look to the switcher market. When they have them in the fixed rate keeps them in.

alastair

Villa05 wrote: »

Not so much generous. These are teasers to keep their existing good customers and prize some away from other banks. They know there is a limited pool of prospective new FTB so to get new customers they have to look to the switcher market. When they have them in the fixed rate keeps them in.

These aren't just rates for switchers though - they're available to all their borrowers - good, bad, and indifferent. They wouldn't offer them at rates below variable, if they didn't think it was advantageous to them. Clearly they expect the variable to fall in the mid term.

Shedite27

gaius c wrote: »

Unless Noonan comes up with a scheme to demolish old people's houses when they die in order to strangle supply, it's fairly evident that prices will drop.

He launched a pilot of this in May, for inner city houses over 100 years old. The catch being that you have to do it up to live in rather than flip or rent.

The_Conductor

alastair wrote: »

These aren't just rates for switchers though - they're available to all their borrowers - good, bad, and indifferent. They wouldn't offer them at rates below variable, if they didn't think it was advantageous to them. Clearly they expect the variable to fall in the mid term.

+1
I've 10 years to run on my BOI mortgage (having bought in 1999). I've separate offer letters from BOI for the main mortgage and all other borrowings (had to take out equity releases when I and my now wife were on long term sick leave).
I've a range of fixing options- 1,2,3,5,10 years- and different rates on them. They are also quoting different rates for the tracker mortgage (as obviously why would anyone take them up on their offer otherwise?)
Seems to be across the board (with BOI anyway- not sure about other lenders)

Floodzie

The_Conductor wrote: »

+1
I've a range of fixing options- 1,2,3,5,10 years- and different rates on them.

Lucky you! I had never heard of a fixed 10 year product in Ireland before. If you are deciding what to choose I suppose it depends on how much you value peace of mind. I would be careful to check what penalties they have for paying off a fixed term early though.

In the US fixed terms of 20+ years are not unusual. I think financial certainty is a bigger boost to an economy than simply money in people's pockets. The government should encourage this.

The_Conductor

It maxes out at 10 years though. If you were to go almost anywhere else in the Eurozone- you'd be able to fix for the entire term of the mortgage. I agree though- its the first 10 year fixed product I've seen either.

gaius c

Villa05 wrote: »

Point 5 Interest rate cycle is beginning to change, US expected to increase this year. Ireland has the highest rates because of our immaturity and inability to deal with bad debts. This has to be priced into new mortgages

There's been talk of interest rate rises for a while now and it's been just that. I'll believe it when the rates are actually increased.

gaius c

Shedite27 wrote: »

He launched a pilot of this in May, for inner city houses over 100 years old. The catch being that you have to do it up to live in rather than flip or rent.

That would increase and improve the existing housing stock and unless there's some hidden catch I'm not aware of, it's a pretty positive scheme.

brownbeard

http://cso.ie/en/releasesandpublications/er/rppi/residentialpropertypriceindexjune2015/#.VbYYumNShRE

Weird. They're usually released on the last Wednesday of the month.

CSO June results: property down 0.4% in Dublin, up 0.1% nationally

Floodzie

gaius c wrote: »

That would increase and improve the existing housing stock and unless there's some hidden catch I'm not aware of, it's a pretty positive scheme.

It's possible Michael Noonan was inspired by the 'Houses for one pound' scheme in Liverpool (in actuality more than one pound, the new owner commits to upgrades but it still works out substantially less than a typical house. The council take on more serious work like roof repair etc).

http://www.theguardian.com/society/2014/jan/29/one-pound-houses-stoke-on-trent-regeneration

No reason why such a scheme would not be workable here. From what I hear, the council require you to be in a job, these are not the same as council houses.

Rew

brownbeard wrote: »

http://cso.ie/en/releasesandpublications/er/rppi/residentialpropertypriceindexjune2015/#.VbYYumNShRE

Weird. They're usually released on the last Wednesday of the month.

CSO June results: property down 0.4% in Dublin, up 0.1% nationally

First media take on them that I have seen:

http://www.thejournal.ie/ireland-house-prices-2237726-Jul2015/

[Deleted User]

Headline is a good summary of how markets work!

seamus

Meanwhile RTE's looks a little more like a report from 2007:
http://www.rte.ie/news/business/2015/0727/717448-property-prices-down-again-in-dublin-in-june/

Things are slowing down, but the fundamentals are good. Apparently, according to the guys they interviewed.

fret_wimp2

seamus wrote: »

Meanwhile RTE's looks a little more like a report from 2007:
http://www.rte.ie/news/business/2015/0727/717448-property-prices-down-again-in-dublin-in-june/

Things are slowing down, but the fundamentals are good. Apparently, according to the guys they interviewed.

"However, there are increasing signs of positive wage growth in the Irish labour market. Rising incomes should allow Irish house prices to rise moderately over the medium term without stretching affordability further," he concluded.

Its ok, dont panic people, rising wages should sort this out!

Floodzie

seamus wrote: »

Meanwhile RTE's looks a little more like a report from 2007

I can understand The Irish Times (MyHome.ie) and TheJournal (Daft.ie) pussyfooting around the fact that the decline is accelerating, but what do RTE have to gain?

Archaeoliz

Floodzie wrote: »

I can understand The Irish Times (MyHome.ie) and TheJournal (Daft.ie) pussyfooting around the fact that the decline is accelerating, but what do RTE have to gain?

I'm not sure the data shows that the decline is accelerating.

(http://cso.ie/en/media/csoie/releasespublications/documents/er/residentialpropertypriceindex/june2015/RPPI2015M06Fig1.png)

To me that graph says it's flat, neither declining or accelerating. If I were RTE I'd be hedging my bets too as IMHO that was the aim of the CB rules. To flatten out the market and prevent huge upward and downward swings by limiting affordability.

As a buyer at the moment who has already sold, I'd dearly love the market to plummet as it would be in my favour at the moment but I'm unconvinced of what it's going to do next. If I were a betting woman it would be on stabilisation and maybe a slight decline.

However, the biggest factor may be totally external as I believe the Chinese stock market is in trouble again having lost 8.5% of its value in the last day's trading. (http://www.bbc.com/news/business-33671459). If the Chinese economy crashes spectacularly then we're all in for a rocky ride.

handlemaster

Archaeoliz wrote: »

I'm not sure the data shows that the decline is accelerating.

(http://cso.ie/en/media/csoie/releasespublications/documents/er/residentialpropertypriceindex/june2015/RPPI2015M06Fig1.png)

To me that graph says it's flat, neither declining or accelerating. If I were RTE I'd be hedging my bets too as IMHO that was the aim of the CB rules. To flatten out the market and prevent huge upward and downward swings by limiting affordability.

As a buyer at the moment who has already sold, I'd dearly love the market to plummet as it would be in my favour at the moment but I'm unconvinced of what it's going to do next. If I were a betting woman it would be on stabilisation and maybe a slight decline.

However, the biggest factor may be totally external as I believe the Chinese stock market is in trouble again having lost 8.5% of its value in the last day's trading. (http://www.bbc.com/news/business-33671459). If the Chinese economy crashes spectacularly then we're all in for a rocky ride.

Money will go back into bricks and mortar

I Am The Law

The_Conductor wrote: »

It maxes out at 10 years though. If you were to go almost anywhere else in the Eurozone- you'd be able to fix for the entire term of the mortgage. I agree though- its the first 10 year fixed product I've seen either.

My first mortgage in 1992 was fixed for 10 years at 9.95%, this was after highs of 14+% in the previous years and scare tactics that these rate "could" return.

Couldn't break out without paying the full interest and after the 10 years rate was circa 2.25% meaning a massive drop in monthly repayments but the bank had made their money.

Looking back now I'm of the opinion that the banks at the time knew exactly where the interest rate was going, which was down, and "locked" people in.

Keep this in mind when considering 10 years, it's torture to see the rate dropping and you stuck with the same monthly payment for years to come!

gaius c

Archaeoliz wrote: »

I'm not sure the data shows that the decline is accelerating.

(http://cso.ie/en/media/csoie/releasespublications/documents/er/residentialpropertypriceindex/june2015/RPPI2015M06Fig1.png)

To me that graph says it's flat, neither declining or accelerating. If I were RTE I'd be hedging my bets too as IMHO that was the aim of the CB rules. To flatten out the market and prevent huge upward and downward swings by limiting affordability.

As a buyer at the moment who has already sold, I'd dearly love the market to plummet as it would be in my favour at the moment but I'm unconvinced of what it's going to do next. If I were a betting woman it would be on stabilisation and maybe a slight decline.

However, the biggest factor may be totally external as I believe the Chinese stock market is in trouble again having lost 8.5% of its value in the last day's trading. (http://www.bbc.com/news/business-33671459). If the Chinese economy crashes spectacularly then we're all in for a rocky ride.

Every Irish mountain looks miniscule when placed next to a Himalayan peak. The fact that the CSO keep comparing current prices to the 2006 peak is a black mark against their credibility because it completely distorts analysis on a micro-scale.

alastair

gaius c wrote: »

Every Irish mountain looks miniscule when placed next to a Himalayan peak. The fact that the CSO keep comparing current prices to the 2006 peak is a black mark against their credibility because it completely distorts analysis on a micro-scale.

It's pretty flat compared to anything tbh -0.1%!. The CSO compare prices to peak, because it's a price index, and the peak is a perfectly valid comparator.

Dee24

Hi all

Have been following this thread constantly over the last year, so thought I'd throw in our situation.

Myself and the hubby bought down the country in 2007, as that's where we wanted to settle and raise kids. But unfortunately he was let go from his job and couldn't get work locally for over 6 months. So he took a job in Dublin and came home weekends for 4 years. Eventually last year we realised he just wouldn't get work back at home. I was lucky that I could get a transfer, and so we both rent in meath at €865 a month now and commute to Dublin. And we're renting our house down the country out.

We have no credit card debt, himself has a car loan of €500 a month with 2 years left to repay, and we've about 50k in savings. And no children as yet. And we're earning €90k between us.

So we visited the bank today, and with the new rules for a 20% deposit, they basically said that by stress testing us with his car loan and our existing mortgage (even taking into account what we're taking in in rent), we would only get €100k.

But that once his car loan is paid off, we could get €200k

So we're gonna wait another year, keep saving, pay off his car in full in 12months time, and try again.

In our own interests, we really want to see house prices come down in meath over the next 12 months.

TheDriver

After following this for 4 years, its all repeating again like 2 years ago where everyone waits then everyone wishes to buy and price doesn't change in reality.....

Dee24

TheDriver wrote: »

After following this for 4 years, its all repeating again like 2 years ago where everyone waits then everyone wishes to buy and price doesn't change in reality.....

Well we had wanted to buy this year, but our visit to the bank today has put the breaks on that.

I know we could pay off the husbands car loan now with our savings, but that would eat into our deposit. So our only option is to wait and keep saving in the mean time.

We're not waiting in the hopes that prices come down, we're waiting cos we don't really have an option.

Believe me, I was hoping to get a house soon, cos we had hoped to have kids in our own home. But that will have to also wait another year. As having a dependant would also affect our application.