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Irish Property Market 2020 Part 2

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Comments

  • #8072
    PropQueries
    Registered Users Posts: 2,203 ✭✭✭PropQueries


    TheSheriff wrote: »
    I would expect supply to remain low until we are well out of this, why would you move now unless you absolutely had too; too many factors at play.

    Rather than causing a dramatic decrease in the market as expected, it's possibly and looking likely covid will just cause it to seize up for the foreseeable.

    Obviously this is not good for both buyers and sellers, irrespective of prices achieved.

    But wouldn't that just result in a zero-sum i.e. if someone sells to buy another home, the two homes just cancel each other out and has no impact on the supply/demand dynamic.

    If that reason is true and it does make sense, the reduction in supply is probably not as big a deal as many believe. It basically just leaves the FTB in the market and that should result in them getting better deals as they're the only buyers around (if that reason is true).


  • #8073
    Billythekid19
    Registered Users Posts: 166 ✭✭Billythekid19


    fliball123 wrote: »
    But people have been spouting on herewith the amount of air bnb and rentals coming on stream (this was 8 or 9 months ago) and the fact that there is no tourism, no students and no immigration inwards, we would have a huge property range to choose from and the opposite has happened.

    We dont have any immigration but we dont have any emigration either.
    There are a huge amount of ex air b and b's on daft.ie as it happens, they are just looking for 2 grand for 1 and 2 bed apartments and not getting any tenants in. Paying a mortgage is still significantly cheaper than renting a house so demand for properties remains high.
    This might change somewhat when rent prices drop in early 2021


  • #8074
    Lia_lia
    Registered Users Posts: 6,691 ✭✭✭Lia_lia


    Smiley11 wrote: »
    I think its safe to say that the market is utterly unpredictable for the foreseeable future. We're chain free buyers & the market in Cork City is chronically bad in my humble opinion. A few high end properties coming on, a few nice 3 bed semis in desirable areas. Seems to be a lot of former rentals being marketed but none of the above appeal to us to be honest. We're dying to buy a house & have a good upsizing budget but the supply is awful.

    If I was selling, I'd be laughing & would probably get a bit more than we did this time last year. We don't know when we're going to find a house & worse, we may have an awful bidding war as seems to be standard these days. Spoke to my friend today who is a manager in one of the "big" banks & she said they're very busy with mortgage applications...same lady told me in March that we'd do very well out of all this as the banks wouldn't be lending. Again, utterly unpredictable. I wish prices would drop but I just don't see it happening any time soon.

    Also looking in Cork city. We are first time buyers. Almost bought a new build but pulled out for reasons related to insurance. Looking now at second hand houses and there's nothing! Prices are very high. Our solicitor says she's up the walls with people buying houses. Same with our mortgage broker. We are in okay position as our rent is quite cheap and we both have secure jobs. But the house is very small and we have a toddler so would really like to buy something soon.


  • #8075
    TheSheriff
    Registered Users Posts: 1,108 ✭✭✭TheSheriff


    PropQueries wrote: »
    But wouldn't that just result in a zero-sum i.e. if someone sells to buy another home, the two homes just cancel each other out and has no impact on the supply/demand dynamic.

    If that reason is true and it does make sense, the reduction in supply is probably not as big a deal as many believe. It basically just leaves the FTB in the market and that should result in them getting better deals as they're the only buyers around (if that reason is true).

    I think it's safe to assume there is a growing number of FTBs and a dwindling number of houses for sale.

    The longer lockdown goes on, the greater the number of FTBers. If you've decided to buy a house as a FTB it's very unlikely you'll change your mind, it takes years of saving/prep.

    If I own a house I want to sell and lock down happens I might pull it back, it's a far easier process.

    The pool of FTBers is only getting bigger and I think covid will create more as people realise the importance of their own space.

    Demand > Supply


  • #8076
    jill_valentine
    Registered Users Posts: 7,090 ✭✭✭jill_valentine


    fliball123 wrote: »
    But people have been spouting on herewith the amount of air bnb and rentals coming on stream (this was 8 or 9 months ago) and the fact that there is no tourism, no students and no immigration inwards, we would have a huge property range to choose from and the opposite has happened.

    Rental market is the twilight zone at the moment, so the change is certainly visible there. The question is whether a critical mass of landlords can either hold out for 2019 rents with empty units or accept that they'll have to get less for the unit from now on, or whether they'll bow out of the rental game.


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  • #8077
    fliball123
    Registered Users Posts: 7,445 ✭✭✭fliball123


    PropQueries wrote: »
    But wouldn't that just result in a zero-sum i.e. if someone sells to buy another home, the two homes just cancel each other out and has no impact on the supply/demand dynamic.

    If that reason is true and it does make sense, the reduction in supply is probably not as big a deal as many believe. It basically just leaves the FTB in the market and that should result in them getting better deals as they're the only buyers around (if that reason is true).

    No not really I showed you that we have quite a high number of people in the 24 to 45 range a good % of these would be first time and second time buyers.

    Also a lot marriages and relationships have hit the skids over the pandemic not just here but worldwide, Nothing worse than having to stay at home with your wife and kids 24/7 to put you in bad form :) but trying to be serious there has been a lot of breakups over the last year.

    So now if the family unit is splintered and not even taking the older kids (24+) who would like their own pad this family unit will now need 2 properties one for dad and one for mum so its not a zero sum game anymore. Below are just a few links out of dozens about breakups during corona.

    https://boycekelly.ie/divorce-rates-expected-to-spike-during-coronavirus-lockdown/

    https://www.irishexaminer.com/news/arid-30993808.html

    https://www.bbc.com/news/uk-northern-ireland-53327738

    https://www.psychologytoday.com/ie/blog/happy-singlehood/202007/why-many-marriages-may-not-survive-second-wave

    https://www.insider.com/what-its-like-to-go-through-breakup-during-coronavirus-pandemic-2020-4

    https://www.irishtimes.com/life-and-style/health-family/has-the-lockdown-changed-how-you-view-your-relationship-1.4271562


  • #8078
    IAmTheReign
    Registered Users Posts: 339 ✭✭IAmTheReign


    PropQueries wrote: »
    But wouldn't that just result in a zero-sum i.e. if someone sells to buy another home, the two homes just cancel each other out and has no impact on the supply/demand dynamic.

    If that reason is true and it does make sense, the reduction in supply is probably not as big a deal as many believe. It basically just leaves the FTB in the market and that should result in them getting better deals as they're the only buyers around (if that reason is true).

    Why do you think that would mean FTBs would be getting a better deal? The amount of FTBs isn't static, there is constantly new FTBs entering the market and if there's a limited supply available for them to buy demand for what is available increases.


  • #8079
    fliball123
    Registered Users Posts: 7,445 ✭✭✭fliball123


    Billythekid19 wrote: »
    We dont have any immigration but we dont have any emigration either.
    There are a huge amount of ex air b and b's on daft.ie as it happens, they are just looking for 2 grand for 1 and 2 bed apartments and not getting any tenants in. Paying a mortgage is still significantly cheaper than renting a house so demand for properties remains high.
    This might change somewhat when rent prices drop in early 2021

    True you may be right with rent drops in 2021 sure only a prophet would know whats going to happen to the property market next year


  • #8080
    fliball123
    Registered Users Posts: 7,445 ✭✭✭fliball123


    jill_valentine wrote: »
    Rental market is the twilight zone at the moment, so the change is certainly visible there. The question is whether a critical mass of landlords can either hold out for 2019 rents with empty units or accept that they'll have to get less for the unit from now on, or whether they'll bow out of the rental game.

    Well they have held out for 9 months already a lot of these landlords would be REITS and other big investment co.s I reckon they could wait it out no bother


  • #8081
    jill_valentine
    Registered Users Posts: 7,090 ✭✭✭jill_valentine


    fliball123 wrote: »
    Well they have held out for 9 months already a lot of these landlords would be REITS and other big investment co.s I reckon they could wait it out no bother

    You could well be right. We'll see though. The guaranteed returns you used to get for rental properties aren't coming back for a very long time and there are a lot of risks and unknowns about how well that property will hold its value while you play the long game and pay for its upkeep.

    At some point that investment money would work harder in something else. Whether we'll get to that point, we'll find out soon I think.


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  • #8082
    PropQueries
    Registered Users Posts: 2,203 ✭✭✭PropQueries


    Claw Hammer wrote: »
    Few if any new builds have commenced since March. Those that were under construction at that time are the last new builds which will be on the market for quite some time to come. The trading up market is bedevilled by uncertainty. People are saving rather than spending. It is also extremely difficult and inconvenient to market and occupied property due to the restrictions and also messy and inconvenient to view property. All repossession cases in the courts have been halted since March, so again there are fewer properties from that source coming to the market. Demographically, household formations are occurring at a high rate due to the Celtic Tiger baby boom.

    If that's true, that doesn't bode well for the 145,500 construction workers in Ireland. Construction workers are generally highly skilled and can move to the UK and start work pretty much immediately. Before anyone says it :) they're still building in the UK, many Irish construction workers have relatives where they can stay for the quarantine period and be working within two weeks from leaving Ireland.

    More emigration, less demand for housing and so forth and so forth. If that is true that 'Few if any new builds have commenced since March' though.


  • #8083
    fliball123
    Registered Users Posts: 7,445 ✭✭✭fliball123


    jill_valentine wrote: »
    You could well be right. We'll see though. The guaranteed returns you used to get for rental properties aren't coming back for a very long time and there are a lot of risks and unknowns about how well that property will hold its value while you play the long game and pay for its upkeep.

    At some point that investment money would work harder in something else. Whether we'll get to that point, we'll find out soon I think.

    Well the only thing I will say about your comment is that yes we will see anything can happen. But someone with a rental and having difficulty renting it out currently has the final option of giving their property to the government and getting 80/85% of the rental value for 20 years + , not sure where you would get that with other investments these days a state guarantee ROI and your property back to you the way you gave it to them. So while that is still an option and judging by the constant moaning from the left about the need for housing this option is going nowhere fast.


  • #8084
    fliball123
    Registered Users Posts: 7,445 ✭✭✭fliball123


    PropQueries wrote: »
    If that's true, that doesn't bode well for the 145,500 construction workers in Ireland. Construction workers are generally highly skilled and can move to the UK and start work pretty much immediately. Before anyone says it :) they're still building in the UK, many Irish construction workers have relatives where they can stay for the quarantine period and be working within two weeks from leaving Ireland.

    More emigration, less demand for housing and so forth and so forth. If that is true that 'Few if any new builds have commenced since March' though.


    Your a crack up you think Ireland is in isolation with regards to issues with construction and the building industry. The UK are having the same issues..so where do all of those workers go?? Poland, the US maybe Oz.. Your entertaining if nothing else. Once again a small snapshot of many links to issues with construction in the UK

    https://www.onrec.com/news/news-archive/construction-and-extraction-workers-wages-hit-hardest-by-covid-19-in-the-uk

    https://www.ft.com/content/3c27d23e-befe-4a53-be52-325adacdb929

    https://www.constructionnews.co.uk/health-and-safety/coronavirus-deaths-top-360-among-construction-workers-26-06-2020/

    https://www.theguardian.com/business/2020/may/06/uk-construction-sector-suffers-its-biggest-slump-on-record-coronavirus-lockdown

    https://www.telegraph.co.uk/business/2020/05/07/maps-charts-show-collapse-construction-industry/


  • #8085
    TheSheriff
    Registered Users Posts: 1,108 ✭✭✭TheSheriff


    PropQueries wrote: »
    If that's true, that doesn't bode well for the 145,500 construction workers in Ireland. Construction workers are generally highly skilled and can move to the UK and start work pretty much immediately. Before anyone says it :) they're still building in the UK, many Irish construction workers have relatives where they can stay for the quarantine period and be working within two weeks from leaving Ireland.

    More emigration, less demand for housing and so forth and so forth. If that is true that 'Few if any new builds have commenced since March' though.

    You really are clutching here PropQueries.


  • #8086
    KennisWhale
    Closed Accounts Posts: 186 ✭✭KennisWhale


    fliball123 wrote: »
    Well the only thing I will say about your comment is that yes we will see anything can happen. But someone with a rental and having difficulty renting it out currently has the final option of giving their property to the government and getting 80/85% of the rental value for 20 years + , not sure where you would get that with other investments these days a state guarantee ROI and your property back to you the way you gave it to them. So while that is still an option and judging by the constant moaning from the left about the need for housing this option is going nowhere fast.

    It's terrifying how heavily involved in the property market the State is, like some glue holding it together. The question is whether it is held together by the State with super glue or pritt stick? There is no endless money supply for the State to carry out current practices such as help the brickie, giving huge money to private landlords for an ever growing group of people that need rental support. I'm sure there will come a time when the growing cost of these subsidies to the market are weighed against a dwindling tax take and higher costs for international market borrowing with such housing market flotation devices needing to be eased.


  • #8087
    fliball123
    Registered Users Posts: 7,445 ✭✭✭fliball123


    KennisWhale wrote: »
    It's terrifying how heavily involved in the property market the State is, like some glue holding it together. The question is whether it is held together by the State with super glue or pritt stick? There is no endless money supply for the State to carry out current practices such as help the brickie, giving huge money to private landlords for an ever growing group of people that need rental support. I'm sure there will come a time when the growing cost of these subsidies to the market are weighed against a dwindling tax take and higher costs for international market borrowing with such housing market flotation devices needing to be eased.

    I would agree with you at the end of the day its our tax euros that is being used to pay for it all, but there seems to be an awful lot of people leaning towards the left point of view the last election would be a good indicator with SF getting their highest return ever on a platform of more housing for the poor. How would you see this situation being reversed


  • #8088
    KennisWhale
    Closed Accounts Posts: 186 ✭✭KennisWhale


    fliball123 wrote: »
    I would agree with you at the end of the day its our tax euros that is being used to pay for it all, but there seems to be an awful lot of people leaning towards the left point of view the last election would be a good indicator with SF getting their highest return ever on a platform of more housing for the poor. How would you see this situation being reversed

    Housing costs, mainly rent for the younger people, dropping significantly (40%+ from March averages), would steer them away from SF. I assume there's plenty of home owning parents with kids living at home that are also sick of the housing situation who are considering SF so they would be steered away.


  • #8089
    Hubertj
    Registered Users Posts: 2,000 ✭✭✭Hubertj


    KennisWhale wrote: »
    It's terrifying how heavily involved in the property market the State is, like some glue holding it together. The question is whether it is held together by the State with super glue or pritt stick? There is no endless money supply for the State to carry out current practices such as help the brickie, giving huge money to private landlords for an ever growing group of people that need rental support. I'm sure there will come a time when the growing cost of these subsidies to the market are weighed against a dwindling tax take and higher costs for international market borrowing with such housing market flotation devices needing to be eased.

    good point, it would be interesting to understand how many FTBers the government is cutting out of market. Then factor is what would happen if they start to build more social housing themselves - this would be contracted out so what would this do in relation to capacity of private sector.
    There is clearly a requirement for accommodation - private, social, etc - so what is the demand / supply impact if government is not so heavily invested.


  • #8090
    fliball123
    Registered Users Posts: 7,445 ✭✭✭fliball123


    KennisWhale wrote: »
    Housing costs, mainly rent for the younger people, dropping significantly (40%+ from March averages), would steer them away from SF. I assume there's plenty of home owning parents with kids living at home that are also sick of the housing situation who are considering SF so they would be steered away.

    Well do you think that landlords would be happy to accept a 40% after signing a contract for the rates agreed for 20 years + I just don't see it happening in my lifetime as I said things that are given are very hard to take away this has always been the case with the Irish state, you only have to look at the high rate of welfare and the ps pay and pensions they had an opportunity in the last recession to trim the fat and they did very little with regards to the spend side in the country.


  • #8091
    KennisWhale
    Closed Accounts Posts: 186 ✭✭KennisWhale


    fliball123 wrote: »
    Well do you think that landlords would be happy to accept a 40% after signing a contract for the rates agreed for 20 years + I just don't see it happening in my lifetime as I said things that are given are very hard to take away this has always been the case with the Irish state, you only have to look at the high rate of welfare and the ps pay and pensions they had an opportunity in the last recession to trim the fat and they did very little with regards to the spend side in the country.

    It's not about what is likely to happen under FF and FG but what I see as a big driver for people to vote for SF. FG will talk about the recovery from 2013 and how strong the economy is, yet something is wrong if young people flocked to SF. We are lucky in Ireland we don't have any right wing types making any headway politically (despite what certain Twitterati who also feature in the media would like to have you believe) but we have gone towards the left. Housing costs are what I see as the single biggest driver for voter dissatisfaction and dropping them significantly is the only way to get voters away from SF.


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  • #8092
    Idbatterim
    Registered Users Posts: 17,840 ✭✭✭✭Idbatterim


    Fg policy has been to give away housing to those that would never vote for them, while crucifying their own voters with rip off prices. Many ex fg voters deflecting to sf. Cutting income tax by less than a euro a week a few budgets ago, during a boom, if you earned just below the marginal rate. While the cost of accomodation skyrockets, you couldnt make it up... all the media seem interested in is free houses for wasters and the givernment then actually believe that the revolt over housing is about that, it isnt. Its about working people being robbed blind for a roof over their head, not sympathy for margaret cash and the legions of workshy wasters in this country...


  • #8093
    brisan
    Registered Users Posts: 2,242 ✭✭✭brisan


    Graham wrote: »
    Mod Note

    folks, there's a dedicated forum for the discussion of Coronavirus (COVID-19) if you'd like to continue that discussion.

    Thats not a place anyone with any interest in maintaining their sanity wants to visit


  • #8094
    ExMachina1000
    Closed Accounts Posts: 3,748 ✭✭✭ExMachina1000


    KennisWhale wrote: »
    The famous line, "this time it's different". I love the optimism, he should replace Tony Holohan as CMO.

    Why would house prices fall? Is it not an asset that hedges against inflation and more importantly houses are in short supply.

    I don't see why prices would fall. What am I missing


  • #8095
    brisan
    Registered Users Posts: 2,242 ✭✭✭brisan


    fliball123 wrote: »
    No not really I showed you that we have quite a high number of people in the 24 to 45 range a good % of these would be first time and second time buyers.

    Also a lot marriages and relationships have hit the skids over the pandemic not just here but worldwide, Nothing worse than having to stay at home with your wife and kids 24/7 to put you in bad form :) but trying to be serious there has been a lot of breakups over the last year.

    So now if the family unit is splintered and not even taking the older kids (24+) who would like their own pad this family unit will now need 2 properties one for dad and one for mum so its not a zero sum game anymore. Below are just a few links out of dozens about breakups during corona.

    https://boycekelly.ie/divorce-rates-expected-to-spike-during-coronavirus-lockdown/

    https://www.irishexaminer.com/news/arid-30993808.html

    https://www.bbc.com/news/uk-northern-ireland-53327738

    https://www.psychologytoday.com/ie/blog/happy-singlehood/202007/why-many-marriages-may-not-survive-second-wave

    https://www.insider.com/what-its-like-to-go-through-breakup-during-coronavirus-pandemic-2020-4

    https://www.irishtimes.com/life-and-style/health-family/has-the-lockdown-changed-how-you-view-your-relationship-1.4271562

    The chances of a divorced couple both buying houses are slim


  • #8096
    brisan
    Registered Users Posts: 2,242 ✭✭✭brisan


    fliball123 wrote: »
    I would agree with you at the end of the day its our tax euros that is being used to pay for it all, but there seems to be an awful lot of people leaning towards the left point of view the last election would be a good indicator with SF getting their highest return ever on a platform of more housing for the poor. How would you see this situation being reversed

    The magical money tree that SF were going to borrow from and that FFG said did not exist has suddenly been found during the pandemic
    SF will use this to their advantage
    They will say they can borrow 5b a year
    Build 25000 houses at 200k on state land
    Sell 20,00 at 250k and rinse and repeat
    Much easier to borrow for houses that for Social welfare payments
    It will capture the imagination of the young people and may succeed
    SF policies on housing MAY not work
    FG policies on housing DO NOT work
    The young people may take the chance


  • #8097
    KennisWhale
    Closed Accounts Posts: 186 ✭✭KennisWhale


    ExMachina1000 wrote: »
    Why would house prices fall? Is it not an asset that hedges against inflation and more importantly houses are in short supply.

    I don't see why prices would fall. What am I missing

    I can argue why they "could" fall but I was more about just highlighting the infamous phrase in an article talking about "surging" house prices!


  • #8098
    thefridge2006
    Registered Users Posts: 220 ✭✭thefridge2006


    Billythekid19 wrote: »
    We dont have any immigration but we dont have any emigration either.
    There are a huge amount of ex air b and b's on daft.ie as it happens, they are just looking for 2 grand for 1 and 2 bed apartments and not getting any tenants in. Paying a mortgage is still significantly cheaper than renting a house so demand for properties remains high.
    This might change somewhat when rent prices drop in early 2021

    Give it time..... air B&B owners can't do that for too long. They are small investors mainly and mortgages will have to be paid...the rental market will become a very bad investment very soon and then they will sell.


  • #8099
    fliball123
    Registered Users Posts: 7,445 ✭✭✭fliball123


    brisan wrote: »
    The chances of a divorced couple both buying houses are slim

    True but if one has to rent it will start showing on the rental market


  • #8100
    Hubertj
    Registered Users Posts: 2,000 ✭✭✭Hubertj


    thefridge2006 wrote: »
    Give it time..... air B&B owners can't do that for too long. They are small investors mainly and mortgages will have to be paid...the rental market will become a very bad investment very soon and then they will sell.

    As I understand it there were/are a lot of cash buyers for investment properties? If they sell what other assets are a viable investment? I also read that mortgage payments are significantly less than rent? Therefore, many landlords can absorb reduced rent?
    And if the rental market is going to become a bad investment very soon who will buy? I presume there aren’t enough potential owner occupiers?


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  • #8101
    brisan
    Registered Users Posts: 2,242 ✭✭✭brisan


    fliball123 wrote: »
    True but if one has to rent it will start showing on the rental market

    Not if its rent a room
    Divorce is an expensive business
    I know one chap who got divorced and his legal bill was 14k
    That included solicitor ,Barrister, Actuary for a report on the value of his pension and other costs
    His wife's bill was 11k
    She could not afford to buy him out and either could he
    She stayed in the house and she has to pay him a fixed sum in the next few years ,plus she has to service the mortgage
    Rent a room is all he can afford after paying child maintenance


This discussion has been closed.
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