Property Market 2020

Hubertj wrote: »

i would have thought LPT would be increasing in the next few years?

Sinn Fein just about got into power on the back of promising to reduce or eliminate property tax, I doubt any other party is going to be viewing it as a future cash cow.

The Student wrote: »

Not necessarily. Investors are concerned with ROI so if you can get a better % return after tax and expenses via property than banks people will go for it.

Property at the right price is a safer bet than a bank. We could be heading to negative interest rates for any savings over €100k.

ROI comes from 2 sources ;- the rental yield and capital growth. Not much point in getting 20k in rent if the capital value drops by 30k!
The first thing investors think about is whether the capital value will hold up. In the longer term the capital gain is more important than rental yield.

eagle eye wrote: »

Yeah comparing this to the last major crash and the banking crisis is ludicrous.
We didn't have a housing shortage then, we had a glut of empty houses and a mass exodus of young people. We also had a banking crisis which isn't the case this time around.
Fact of the matter is this has been a disaster but they'll solve it by making the people pay for it. There won't be mass emigration because every country is suffering and there's no booming economy anywhere.
So we still have a housing crisis.

While there not be emigration, there will not be immigration. There will way fewer foreign students here in the Autumn. Some Irish students are saying that they will have no summer earnings, their parents earnings have been affected and they would be able to return to college in the autumn. Hotel, bar and restaurant employees won't need accommodation in such numbers in the Autumn either.
mathematically, that will have the same effect as mass emigration and unoccupied newly constructed buildings. Many companies will be cancelling capital projects as well so construction workers may have less work.
As the banks take stock they will once again be concerned about arrears rather than growing business.
The single factor which might make a difference this time is the availability of credit. Last time there was none, this time who knows?

Reversal wrote:

Your posts are indicative of the psychology at work here.
AFTER deciding to proceed with a purchase, you have become steadfast in the opinion that prices can't fall. Basic human nature, but it's important to at least be aware when suffering from confirmation bias.

Nothing, it's that I've studied it and gotten advice from experts and friends in different sectors of the economy.
I'm not predicting that house prices won't drop either. I'm predicting that it won't be as severe as most seem to think. I think you'll be see a max drop of 20% on less attractive properties and somewhere in the region of 5-15% in more attractive properties.
I made my decision to proceed based on this information.
I've mentioned the factors at play, I don't see anybody challenging them other than saying that financial pain from other sectors will seriously hit the housing market. I disagree with that because we have a housing shortage crisis. Any monies earmarked for solving this issue will now be part of repayments on our debts so I don't see a massive amount of new houses being built anytime soon.
I don't see a mad rush to buy anytime soon but I don't see panic sales happening either

Marius34 wrote: »

I'm following this thread. I'd say the average based on the opinions of this thread would be around 15%-20% in fall. There are some looking for over 30%, and even 50% in crash. As far as I have seen, I'm the most optimistic here, expecting only around 5% in property price downturn. although 10% wouldn't be surprise either, as that is not big difference from 5% in current uncertainty.

We are all just internet people.
None of us have a clue if we are honest

Eric Cartman wrote: »

I think songles, childless couples and workers from overseas will be looking to leave. Irelands personal taxation on middle and high earners is at breaking point.

Where will they go?

Eric Cartman wrote: »

That I dont know, but with the irish government trying to extract ever more blood from a stone, somewhere will realise theres opportunity for english speakong skilled workers sick of having every cent stolen from them

England and the US were the release valves until around 2000, the US us no longer an option with its emigration policies and Brexit will limit the UK as an option. During the last recession Australia, NZ and Canada were options. Australia has started to limit immigration, unless you go as a.young worker there imigration policy makes it hard enough to access there. NZ and Canada were options and may still be but NZ is closed at present and Canada has limited options

Hard to see either taking 40k people a year for 3-4 years. On workers returning home most eastern European workers stayed the course last time and I expect will again

cnocbui wrote: »

Sinn Fein just about got into power on the back of promising to reduce or eliminate property tax, I doubt any other party is going to be viewing it as a future cash cow.

I think property tax will be staying where it is for many years to come.
I dont think it will increase. It may even go down a bit. It would be scumabaggery of the highest order to increase property taxes now.

Eric Cartman wrote: »

I think songles, childless couples and workers from overseas will be looking to leave. Irelands personal taxation on middle and high earners is at breaking point.

I know a couple moving to Portugal.
They had said before if tax went up anymore here they would just sell up everything and retire to Portugal. They are both just under 50 and already spent about 2 months a year there anyway. In the last few weeks they have decided to just that anyway.
He said to me that they feel robbed by the tax man here and are just about ready to leave the rat race anyway.
I will go into more detail with him when i meet him again, if i ever do

JimmyVik wrote: »

I know a couple moving to Portugal.
They had said before if tax went up anymore here they would just sell up everything and retire to Portugal. They are both just under 50 and already spent about 2 months a year there anyway. In the last few weeks they have decided to just that anyway.
He said to me that they feel robbed by the tax man here and are just about ready to leave the rat race anyway.
I will go into more detail with him when i meet him again, if i ever do

A drop on property values might change the dynamics of what they are planning. Pocketing 300k and moving to Portagul is way more attractive than pocketing 24Ok and going there. If there is a 100k to be paid back on a mortgage it is even less attractive

eagle eye wrote: »

Nothing, it's that I've studied it and gotten advice from experts and friends in different sectors of the economy.
I'm not predicting that house prices won't drop either. I'm predicting that it won't be as severe as most seem to think. I think you'll be see a max drop of 20% on less attractive properties and somewhere in the region of 5-15% in more attractive properties.
I made my decision to proceed based on this information.
I've mentioned the factors at play, I don't see anybody challenging them other than saying that financial pain from other sectors will seriously hit the housing market. I disagree with that because we have a housing shortage crisis. Any monies earmarked for solving this issue will now be part of repayments on our debts so I don't see a massive amount of new houses being built anytime soon.
I don't see a mad rush to buy anytime soon but I don't see panic sales happening either

You were on here literally 2 weeks ago with the below asking advice (3 posts added in).

eagle eye wrote: »

We really like the property but we don't want to be paying out huge money now and finding ourselves in a situation where the property is worth a lot less in six months time. We'd prefer to be on a healthier financial position.
We are in a good financial position, we aren't going to be buried with a big mortgage if we do go ahead.
There are other nice houses that we've looked at in the same area which will be available when this is all over.

2)
I was talking to my solicitor today and she told me that everybody is pulling out. Her advice to us, as predominantly cash buyers, is to wait and see.
The owners of the house we agreed a sale on want to have their cake and eat it. They were looking for contracts to be signed but the purchase not to take place for eight weeks.

3)
No, there are a multitude of reasons why people in good financial situations might want to sell. Everything from retirees relocating to people upsizing/downsizing etc.
The biggest hit on the market will come from the lack of younger people being able to get a mortgage. There will be less buyers and from every expert I've talked to they say that the cash buyer will be in a really strong position.

Then you bought the place and almost immediately were an expert, standing on the other side of the argument. The last post is contradicting what you're arguing now. I actually probably agree slightly more with your new line of thinking but you're a very obvious case of confirmation bias of the decision.

Hulk Hands wrote:

Then you bought the place and almost immediately were an expert, standing on the other side of the argument. The last post is contradicting what you're arguing now. I actually probably agree slightly more with your new line of thinking but you're a very obvious case of confirmation bias of the decision.

I'm sharing what I've learned through listening to experts and friends working in a number of different sectors of the financial industry as well as reading a lot of stuff.
Instead of attempting a bit of oneupmanship how about you address the points I've made if you disagree.

Augeo wrote: »

Tax hasn't gone up though.
they are wealthy enough and want to retire to Portugal, and they are sick of the "rat race". Fantastic, great to see, but there has been no tax increases.

Did Covid19 effect their jobs?

I love Portugal but don't think I could live there tbh....... no place like home
If you are retired with a few quid Ireland isn't too bad a spot IMO.

Perhaps im not explaining this right.
We have had many conversations in the past about how tax rates in Ireland are killing us.
They were on the on the verge of giving it all up to retire to Portugal and always said if tax rates go up anymore we're off.
So now its fairly certain taxes are going up.
They have been pushed over the edge and are off. THey might wait and see if taxes go up, they might not. Im fairly sure they are going up.

They lose so much to tax from working they have decided that they might as well have a better life and trade what they were earning from working.

They might change their minds. They might not.
Im just explaining where they have finally decided too much tax is too much tax. Better chase the dream than be a wage slave.


I prefer not to do overtime myself, so i usually refuse it. And when they insist I do it I ask for toil. Perhaps if I wasnt taxed so much and got to keep more of my overtime, I might do more of it. I think I pay far too much tax tbf.



Ireland is not a bad place to live, apart from the weather and the tax.
And I believe in Portugal you get huge tax breaks and incentives for retiring there. I think you even dont pay tax for 10 years if you move there and only earn money from retirement funds or investments.

As I said, I will find out more when i meet him. Always have interesting conversations with him. Myself, I dont see the attraction in Portugal. They love it though.


Now this is entirely 2nd hand information from me and ive filled in some blanks until i ask the questions. But the gist of it is. Another tax hike will be the straw that broke the camels back for them.

Hulk Hands wrote:

You were cap in hand looking for advice, yet turned into Luke Comer a couple of days later on the back of a bit of reading? By all means share who the experts that advised you are and what they said. As yet you havent done that.
I won't disagree with any points because like you were 14 days ago, i'm a novice looking for a bit of steer from others on how things will go

You expect me to put up names of people? I'm not doing that.
Through my bank, my solicitor and friends I got to speak to experts in different financial fields who look at things. In most cases they weren't giving out dreary outlooks but we're concerned.
My situation is a bit different to others, I personally believed the house I was buying was worth 50k more than the price agreed. My architect, who invests in building and selling, told me the house is worth at least the valuation I put on it. He is also a personal friend.
A friend of his who works buying and selling money told me that there he expected a reduction in house prices but also said my money would be worth less and that any reduction in the value of the property might never actually change the price as money is worth less.
Another friend of a friend who works in financial planning told me that he expected a temporary drop in house prices after third quarter reports in 2020 but that's all dependent on whether people get back to work by then. He said if people are not back to work by September it could get really bad. He said that money will be devalued greatly the longer this goes on. He said house prices will go down but there'll be no new houses built which should protect the market a bit.
I'd have taken the advice of those two above what others have said because they both seem very clued in on money.
I'd be of the opinion based on all I've heard that there may be a bigger reduction in less attractive properties and not as big in more attractive properties. I'm talking in the €200k-800k price range here.
All the advice I got led me to go ahead with the purchase. I don't care about a 10% reduction, it'd want to be a lot more than that to tempt me out of the market. I've also said that this is our forever home, we both love it and that played a part in our decision too.
At a reduction of 20% in prices I'm still not left in a bad situation as I don't have a very big mortgage.

Assetbacked wrote: »

https://www.linkedin.com/posts/activity-6663419031510368256-acDb

Owen Reilly, an estate agent, giving his experience of the past few weeks. Interesting to hear what he has had to say; renter's market but remains resilient with week on week demand building; 15% of tenants they are manager in respect of have requested variation to rental terms; just over 50% of sales have fallen through, majority were investor buyers; 2 owner occupiers had their mortgage approval withdrawn by the banks; nonetheless he still had 5 closings last week, 4 of the buyers signed contracts after the crisis began; and he welcomes the move to innovation and technology for the sector.

Is this guy a large estate agent? Or judging by his commentary he specialises in Docklands area?

Hubertj wrote: »

Is this guy a large estate agent? Or judging by his commentary he specialises in Docklands area?

Yeah, this guy specialises in overpriced Docklands and D4 apartments. It's rare they list anything not upper end of the market or in a less than premium area.

Having somewhere to live that makes you happy has a very high value as well, a few may get lucky in this period and get something really desirable at a knockdown price, but there wont be many, and it wont be this week or next, more like 6-9 months or a year down the road.

We bought this house 3 years ago, 9 months later someone paid 180k more for theirs than i did for mine (identical houses in an estate), if i was to sell mine today id imagine id struggle to get what we paid for it, not to mention all the money thats gone into it,

i was dancing when someone paid more and i wouldnt cry if someone pays less. We have loved loving here and the last 3 years have been brilliant, the kids are in a great local school and with any luck will go all the way from starting primary to leaving cert in the same school system.

Added to that if i hadn't have bought this and rented the same thing for the last 3 years it would have cost me 160k or so.

short version is if i could get the same home today for 50/100k less than i paid 3 years ago i wouldnt go back in time.

Augeo wrote: »

What do they do for a living?
In Portugal wages are appalling.

If they are just under 50 they are very close to being able to access their OCP or Executive pensions so as Cyrus mentions they can afford to and they are just retiring.

You opbviously know them better than I do so