2021 Irish Property Market chat - mod warnings post 1

Timing belt · 16-01-2021 12:03am

SpencerJC wrote: »

Last year was a strange one for sure. I think there are a lot of people who have been quietly saving (I know a few) and some of these deposits will come on stream this year. It's unfortunate, but a lot of people who were penalised financially by corona may not have been in the market anyway, lot of pub workers, retail etc. With the supply issue and banks continuing to lend, I don't see prices in Dublin dipping, more likely to go up imo. The biggest threat to housing prices is inflation. With all the money being pumped into the economy, at some point we will likely see inflation and interest rates go up. Falling house prices will follow when it becomes more expensive to borrow. Either way as a buyer, I don't see the environment getting much better (In Dublin). Other side of the coin is with 3.5 lending limits, how high is the ceiling

Yes you are correct that a rise in rates would cause a havoc on the property market. It would also kill all other asset classes as they have already repriced for a low interest rate environment for the next few years.

A lot of people were expecting inflation to come through in this months CPI especially in USA as the USD has been dropping in value and making imports more expensive. The market was full sure we would see inflation with the yield on the 10yr Treasury rising dramatically up to 1.18 only for the CPI to deliver modest to weak inflation and the yield dropping back to 1.08. There are a lot of signs that we will not see the economy boom without further intervention by governments. Even the additional 2 Trillion by Biden may not be enough to see inflation. As for Europe it faces even harder headwinds to see inflation as the majority of its inflation from previous QE came from a weaker EUR and with the USA doing an extra 2 Trillion it will make the EUR stronger to the dollar and lower the chances of inflation in Europe in the short term.

PropQueries · 16-01-2021 12:46am

Timing belt wrote: »

Yes you are correct that a rise in rates would cause a havoc on the property market. It would also kill all other asset classes as they have already repriced for a low interest rate environment for the next few years.

A lot of people were expecting inflation to come through in this months CPI especially in USA as the USD has been dropping in value and making imports more expensive. The market was full sure we would see inflation with the yield on the 10yr Treasury rising dramatically up to 1.18 only for the CPI to deliver modest to weak inflation and the yield dropping back to 1.08. There are a lot of signs that we will not see the economy boom without further intervention by governments. Even the additional 2 Trillion by Biden may not be enough to see inflation. As for Europe it faces even harder headwinds to see inflation as the majority of its inflation from previous QE came from a weaker EUR and with the USA doing an extra 2 Trillion it will make the EUR stronger to the dollar and lower the chances of inflation in Europe in the short term.

But wasn’t the low inflation problem over the past ten years (30 years?) due to an oversupply of both workers and goods from e.g. China. No amount of QE would have increased prices in such a scenario. Hence all that extra QE money going into either property or public sector wages/pensions instead of rising prices.

With supply issues now becoming apparent across all sectors, inflation could ramp up very quickly.

Inflation was always a supply side issue and central banks have never been able to control it no matter what nonsense they’ve bring spouting over the past 40 years.

Once it starts, central banks will do their usual interest rate rises quickly while not realising they have absolutely no impact on inflation levels. Of course, unless they ramp up interest rates to 20%. But interest rates rising to only 4% (I think 1% would do it) would destroy all value added to the property market since 2012 in very short order IMO.

L1011 · 16-01-2021 1:02am

PropQueries wrote: »

But wasn’t the low inflation problem over the past ten years (30 years?)

If you think Ireland has had low inflation for 30 years, you weren't paying attention for about more than half of them.

Graham · 16-01-2021 1:13am

PropQueries wrote: »

With supply issues now becoming apparent across all sectors, inflation could ramp up very quickly.

with two of the side effects being:

1) decreasing the value of a rather large amount of debt many nations have just acquired.

2) increasing property values

Timing belt · 16-01-2021 1:16am

PropQueries wrote: »

But wasn’t the low inflation problem over the past ten years (30 years?) due to an oversupply of both workers and goods from e.g. China. No amount of QE would have increased prices in such a scenario. Hence all that extra QE money going into either property or public sector wages/pensions instead of rising prices.

With supply issues now becoming apparent across all sectors, inflation could ramp up very quickly.

Inflation was always a supply side issue and central banks have never been able to control it no matter what nonsense they’ve bring spouting over the past 40 years.

Once it starts, central banks will do their usual interest rate rises quickly while not realising they have absolutely no impact on inflation levels. Of course, unless they ramp up interest rates to 20%. But interest rates rising to only 4% (I think 1% would do it) would destroy all value added to the property market since 2012 in very short order IMO.

If the ECB deposit rate went to 0% it would crush all asset prices and the EU economy would be in bits as 90% of companies would go bust because of the amount of debt they have and would not be able to afford the debt servicing costs. Governments would be in the same boat... so we would have mass unemployment in both private and public sectors. So anyone hoping that rate rises will make things more affordable through lower asset prices is only looking at half the picture. What the economy needs is inflation accompanied by real economic growth. If we don't see this because of lack of inflation or to much inflation then it will end in economic pain.

Timing belt · 16-01-2021 1:18am

Graham wrote: »

with two of the side effects being:

1) decreasing the value of a rather large amount of debt many nations have just acquired.

2) increasing property values

Property prices would drop as rates would need to rise to deal with the inflation.

Graham · 16-01-2021 1:18am

Timing belt wrote: »

What the economy needs is inflation accompanied by real economic growth.

This

Graham · 16-01-2021 1:20am

Timing belt wrote: »

Property prices would drop as rates would need to rise to deal with the inflation.

Only if there were interest rate increases at a time when a reasonable level of inflation would be good for many countries.

Inflation would cause prices to increase (i.e. inflation) before consideration was given to any requirement to control inflation.

PropQueries · 16-01-2021 1:27am

Timing belt wrote: »

If the ECB deposit rate went to 0% it would crush all asset prices and the EU economy would be in bits as 90% of companies would go bust because of the amount of debt they have and would not be able to afford the debt servicing costs. Governments would be in the same boat... so we would have mass unemployment in both private and public sectors. So anyone hoping that rate rises will make things more affordable through lower asset prices is only looking at half the picture. What the economy needs is inflation accompanied by real economic growth. If we don't see this because of lack of inflation or to much inflation then it will end in economic pain.

Good point. But that’s where my theory on the influence of our low debt to gdp Eastern European eurozone members comes into play.

I don’t believe they will allow inflation levels to hit anything above 4% before forcing the ECB to raise rates.

They have as much to lose from allowing inflation to run out of control as we (and the few other eurozone countries with a debt problem) have to gain from such a scenario IMO

Browney7 · 16-01-2021 1:28am

Graham wrote: »

Only if there were interest rate increases at a time when a reasonable level of inflation would be good for many countries.

Inflation would cause prices to increase (i.e. inflation) before consideration was given to any requirement to control inflation.

Ordinarily if inflation increases there would be less demand for sovereign debt or investors would require higher returns so yields/interest rates would increase - although the ECB printing money and buying all the debt it can get it's hands means all bets are off on this front

Timing belt · 16-01-2021 1:29am

Graham wrote: »

Only if there were interest rate increases at a time when a reasonable level of inflation would be good for many countries.

Inflation would cause prices to increase (i.e. inflation) before consideration was given to any requirement to control inflation.

you are correct the economy needs inflation as long as it is coming from growth
(Pull Inflation)... If it is push inflation as prop is suggesting with the increase coming from the supply side then we could see stagflation.

The EU will tolerate inflation over 3-4% for longer than a year before they start raising the official interest deposit rate. Where the problem comes is that the market doesn't use this rate and instead will price of the yield curve on Germany's bonds and then price adjust via the CDS spread to each of the other EU countries. So if we do see inflation the yield on both government and private issuance of debt will lead to an increase in debt servicing costs for both which will be paid for with job cuts unless these companies/governments are making more than the cost of the inflation.

Timing belt · 16-01-2021 1:32am

Browney7 wrote: »

Ordinarily if inflation increases there would be less demand for sovereign debt or investors would require higher returns so yields/interest rates would increase - although the ECB printing money and buying all the debt it can get it's hands means all bets are off on this front

Government's need to issue the debt for them to buy or you end up with liquidity issues on the bond market. Its not even a sledge hammer with a nail it is more like trying to do brain surgery with a JCB

Graham · 16-01-2021 1:32am

PropQueries wrote: »

Good point. But that’s where my theory on the influence of our low debt to gdp Eastern European eurozone members comes into play.

I don’t believe they will allow inflation levels to hit anything above 4% before forcing the ECB to raise rates.

At the end of September, Christine Lagarde all but said an inflationary policy may be appropriate in the face of Coronavirus debt and years of below target inflation.

“In the current environment of lower inflation, the concerns we face are different (than in 2003) and this needs to be reflected in our inflation aim,” ECB President Christine Lagarde said at a press conference on Wednesday.

She spoke of a wider debate happening on whether central banks should commit to explicitly make up for inflation misses when they have spent some time below their targets.

Timing belt · 16-01-2021 1:39am

Graham wrote: »

Christine Lagarde has already all but said an inflationary policy may be appropriate in the face of Coronavirus debt and years of below target inflation.

They are forward guidance comments which was the signal for investors to reprice to a lower rate environment for at least the next 2 years... The fed did the same thing and since the start of the year we saw the market ignore the comments with yield rising because they believed that inflation above 2% would come through in the Jan CPI. when it failed to deliver the yield dropped.

Central banks can provide forward guidance but the market will do what it thinks based on what their expectations are.

Timing belt · 16-01-2021 1:42am

PropQueries wrote: »

Good point. But that’s where my theory on the influence of our low debt to gdp Eastern European eurozone members comes into play.

I don’t believe they will allow inflation levels to hit anything above 4% before forcing the ECB to raise rates.

They have as much to lose from allowing inflation to run out of control as we (and the few other eurozone countries with a debt problem) have to gain from such a scenario IMO

They have no say it is the economic powerhouse of Germany and France that will dictate it.

Graham · 16-01-2021 1:43am

Browney7 wrote: »

the ECB printing money and buying all the debt it can get it's hands means all bets are off on this front

Uncharted territory indeed.

I understand the ECB monetary policy review was postponed from last year to mid this year. Part of the review "will consider whether the ECB’s inflation aim should be reformulated and over which time horizon prices should be stabilised"

Graham · 16-01-2021 1:51am

Timing belt wrote: »

Government's need to issue the debt for them to buy or you end up with liquidity issues on the bond market. Its not even a sledge hammer with a nail it is more like trying to do brain surgery with a JCB

Isn't that what's already happening?

"ECB to gobble up more debt next year than governments can sell"
FT Last October

PropQueries · 16-01-2021 1:53am

Timing belt wrote: »

They have no say it is the economic powerhouse of Germany and France that will dictate it.

But will the German pensioners tolerate much higher inflation with no increase in deposit rates to offset the costs?

I think Germany will be more aligned with their Eastern European neighbours than France on this one.

Just because France, Italy, Ireland and one or two others have dug themselves into a hole by believing they can continuously borrow to meet the unrealistic expectations of their public sector class, doesn’t mean the other members (who are in the majority) will tolerate it much longer. Especially if they begin to see inflation begin to run out of control IMO.

Graham · 16-01-2021 1:59am

PropQueries wrote: »

But will the German pensioners tolerate much higher inflation with no increase in deposit rates to offset the costs?

The German intolerance for inflation has shown several signs of softening recently, no doubt influenced in no small part by German debt.

The German administration has just released their €130 billion economic stimulus package, the most prominent measure of which is an unconventional fiscal policy in the form of a sudden drop in VAT. The aim is to create a future path of increasing sales taxes by increasing prices and hence stimulating inflation

Vox EU last June

Timing belt · 16-01-2021 2:01am

PropQueries wrote: »

But will the German pensioners tolerate much higher inflation with no increase in deposit rates to offset the costs?

I think Germany will be more aligned with their Eastern European neighbours than France on this one.

Will the German people tolerate job losses and mass unemployment and businesses going bust so the pensioners can have a deposit rate?

Just because France, Italy, Ireland and one or two others have dug themselves into a hole by believing they can continuously borrow to meet the unrealistic expectations of their public sector class, doesn’t mean the other members (who are in the majority) will tolerate it much longer. Especially if they begin to see inflation seat to run out of control IMO.

They are not in a majority as there would be economic pain in all EU countries if this happened. They would all go through what Ireland did after 08. Now imagine the knock on impact to USA, China etc and the pressure that would come from them and all this will happen because of a few small EU countries.

Timing belt · 16-01-2021 2:07am

Graham wrote: »

Isn't that what's already happening?

"ECB to gobble up more debt next year than governments can sell"
FT Last October

yes this is happening but if they over cook without issuing new debt then you will have shortages in specific Bonds which was what happened in march and investors started using other assets for collateral and set off a chain reaction in the markets. Hence the announcements of Trillions to calm things down and get markets moving again.

PropQueries · 16-01-2021 2:21am

Timing belt wrote: »

Will the German people tolerate job losses and mass unemployment and businesses going bust so the pensioners can have a deposit rate?

They are not in a majority as there would be economic pain in all EU countries if this happened. They would all go through what Ireland did after 08. Now imagine the knock on impact to USA, China etc and the pressure that would come from them and all this will happen because of a few small EU countries.

Good point. But then, IMO, interest rates would have to increase much much sooner but by a smaller amount to nip it in the bud before it gets a chance to take off too much.

If they allow inflation to get to a level where they would need much larger interest rate increases to rein it in they would definitely destroy the economy.

Graham · 16-01-2021 2:28am

There's a consensus forming that a few years of catch-up inflation might be desirable.

I think the question is more 'how do we make it happen' rather than 'how do we stop it'.

Timing belt · 16-01-2021 2:32am

Graham wrote: »

There's a consensus forming that a few years of catch-up inflation might be desirable.

I think the question is more 'how do we make it happen' rather than 'how do we stop it'.

Spot on... we are still seeing deflation in the economy not to mention inflation and the EU revised there forecasts for inflation down in January because of more lockdowns etc...

Graham · 16-01-2021 2:59am

Timing belt wrote: »

Spot on... we are still seeing deflation in the economy not to mention inflation and the EU revised there forecasts for inflation down in January because of more lockdowns etc...

I think we may finally see some upward pressure on inflation when the assorted vaccination programs reach that tipping point where things start to open up again.

After what's likely to have been 1.5 - 2 years of restrictions I expect a period of almost euphoric boom as populations make the most of their re-found freedom. Service industries, tourism and retail quickly bouncing back.

The effect this will have on property remains to be seen but I'd be surprised to see much (if any) downward pressure on prices.

Villa05 · 16-01-2021 3:02am

Timing belt wrote:

They have no say it is the economic powerhouse of Germany and France that will dictate it.

Will Germany tolerate inflation eating away their savings

Villa05 · 16-01-2021 3:08am

Graham wrote:

I think the question is more 'how do we make it happen' rather than 'how do we stop it'.

Put FF in charge of the controls

hometruths · 16-01-2021 10:10am

Graham wrote: »

There's a consensus forming that a few years of catch-up inflation might be desirable.

I think the question is more 'how do we make it happen' rather than 'how do we stop it'.

Agreed, but I think there is a danger of the question moving quite quickly from how do we make it happen to how we do we stop it?

If inflation starts rising, it could rise quite rapidly when things open up. At that stage CBs may be in a bit of a bind, as raising interest rates will cause a lot of problems.

I agree this is bullish for property.

PropQueries · 16-01-2021 11:40am

schmittel wrote: »

Agreed, but I think there is a danger of the question moving quite quickly from how do we make it happen to how we do we stop it?

If inflation starts rising, it could rise quite rapidly when things open up. At that stage CBs may be in a bit of a bind, as raising interest rates will cause a lot of problems.

I agree this is bullish for property.

There were two economists who published a book before Christmas called “The Great Demographic Reversal”, who are predicting a big rise in inflation from this year.

They stated that “Deflationary headwinds over the last three decades have been primarily due to an enormous surge in the world’s available labour supply, owing to very favourable demographic trends and the entry of China and Eastern Europe into the world’s trading system.”

They’ve being doing the interview rounds and you can watch their interviews on YouTube about their book and there have been a couple of articles in the FT etc. stating their analysis is something to seriously watch.

They readily admit their thinking is in the minority (at the moment) but has been gaining more and more attention over the past couple of months as they’re very respected economists.

Mic 1972 · 16-01-2021 11:55am

All the money that is being printed to sustain the economy is going to create huge inflation. The same happened after the war in countries like italy and germany

PropQueries · 16-01-2021 12:11pm

Mic 1972 wrote: »

All the money that is being printed to sustain the economy is going to create huge inflation. The same happened after the war in countries like italy and germany

I think the proof on why central banks shouldn’t be allowed to fund government spending is the big pay hike being considered for Robert Watt as the new Department of Health secretary general.

He definitely deserves it (and much more IMO) as he’s one of few truly decent civil servants in the state but it just goes to show that wherever a government gets its extra money e.g. borrowing, taxation etc. they just waste it on everything and anything (social housing build costs being another one) that doesn’t add much value to our economy/society and leads to the easily predictable disaster eventually,

PropQueries · 16-01-2021 12:22pm

The distressed mortgage sales are back:

“AIB plans ethical sale of up to 650 distressed mortgages”

“ The sale of AIB’s Project Iris portfolio comes in advance of the much bigger and more controversial Project Oak portfolio sale. The latter will see the bank sell off up to 6,000 distressed loans, with an original book value of €1.3 billion, on the open market. The bank decided last March to postpone the Project Oak sale indefinitely – its first sale of non-performing private residential mortgages.”

Link to Irish times article here: https://www.irishtimes.com/business/financial-services/aib-plans-ethical-sale-of-up-to-650-distressed-mortgages-1.4459601?mode=amp

combat14 · 16-01-2021 1:09pm

PropQueries wrote: »

The distressed mortgage sales are back:

“AIB plans ethical sale of up to 650 distressed mortgages”

“ The sale of AIB’s Project Iris portfolio comes in advance of the much bigger and more controversial Project Oak portfolio sale. The latter will see the bank sell off up to 6,000 distressed loans, with an original book value of €1.3 billion, on the open market. The bank decided last March to postpone the Project Oak sale indefinitely – its first sale of non-performing private residential mortgages.”

Link to Irish times article here: https://www.irishtimes.com/business/financial-services/aib-plans-ethical-sale-of-up-to-650-distressed-mortgages-1.4459601?mode=amp

6,000 distressed mortgages wow this must be the last batch surely - hopefully mortgage interest rates fall or remain steady here or we will be in serious trouble again

PommieBast · 16-01-2021 2:42pm

PropQueries wrote: »

Link to Irish times article here: https://www.irishtimes.com/business/financial-services/aib-plans-ethical-sale-of-up-to-650-distressed-mortgages-1.4459601?mode=amp

I would like to know how much this bundle actually gets bought for. 50% markdown would not surprise me.

Villa05 · 16-01-2021 3:10pm

PommieBast wrote:

I would like to know how much this bundle actually gets bought for. 50% markdown would not surprise me.

These in theory will be social housing. I'd be very surprised if there was 50% markdown

PropQueries · 16-01-2021 3:18pm

Villa05 wrote: »

These in theory will be social housing. I'd be very surprised if there was 50% markdown

That’s the thing. AIB (basically state owned) will most likely sell them to an “ethical” investment fund who will then rent them back to the state. Why doesn’t the state just cut out the middle man and save everyone money, time and most importantly stress?

There was a good article in Irish Times last week:

“The State’s mortgage-to-rent scheme has been irrevocably undermined by the entry of a commercial player, which is outbidding the not-for-profit agencies for the properties involved, according to mortgage campaigner David Hall.”

Link to Irish Times article here: https://www.irishtimes.com/business/economy/mortgage-to-rent-scheme-undermined-by-commercial-entity-claims-david-hall-1.4455789?mode=amp

Timing belt · 16-01-2021 3:20pm

Mic 1972 wrote: »

All the money that is being printed to sustain the economy is going to create huge inflation. The same happened after the war in countries like italy and germany

PropQueries · 16-01-2021 3:26pm

Timing belt wrote: »

Isn’t that where many of the experts get it wrong. Without supply side constraints, no amount of money printing will lead to inflation (as defined by the official measurement).

Plus, there’s no point encouraging banks to lend into the real economy when there’s no real new business ideas to lend into (in the EU anyway).

Also yesterday, Bloomberg had an article that the Ford motor plant in Germany is closing for a month due to semi conductor shortages.

So, it looks like the few economists who predicted that this is where inflation will originate sooner than many expected may be right.

Timing belt · 16-01-2021 3:36pm

PropQueries wrote: »

Isn’t that where many of the experts get it wrong. Without supply side constraints, no amount of money printing will lead to inflation (as defined by the official measurement).

Plus, there’s no point encouraging banks to lend into the real economy when there’s no real new business ideas to lend into (in the EU anyway).

Even if no one is borrowing the QE still keeps rates low and asset prices high.

PropQueries wrote: »

Also yesterday, Bloomberg had an article that the Ford motor plant in Germany is closing for a month due to semi conductor shortages.

So, it looks like the few economists who predicted that this is where inflation will originate sooner than many expected may be right.

These shortages are because of Covid supply issues and are not structural so will not lead to long term inflation. A structural change would be an end to the 40 year Bear market for Bonds (or to rephrase it another way a end to 40 years of a bull market in equities)

PommieBast · 16-01-2021 4:13pm

Villa05 wrote: »

These in theory will be social housing. I'd be very surprised if there was 50% markdown

These are loans in default and the "ethical" and "borrower-friendly" description to me sounds very much like some sort of repossession ban. No sane commercial outfit would take them on without a huge discount.

I would also worry if "debt charity" is a euthamism for "dumped onto the government books". Would like to know where they would get this sort of money.

Browney7 · 16-01-2021 5:56pm

PropQueries wrote: »

That’s the thing. AIB (basically state owned) will most likely sell them to an “ethical” investment fund who will then rent them back to the state. Why doesn’t the state just cut out the middle man and save everyone money, time and most importantly stress?

There was a good article in Irish Times last week:

“The State’s mortgage-to-rent scheme has been irrevocably undermined by the entry of a commercial player, which is outbidding the not-for-profit agencies for the properties involved, according to mortgage campaigner David Hall.”

Link to Irish Times article here: https://www.irishtimes.com/business/economy/mortgage-to-rent-scheme-undermined-by-commercial-entity-claims-david-hall-1.4455789?mode=amp

Presumably to keep the borrowing off the state balance and engage in some balance sheet gymnastics.

ICare is David Hall's not for profit agency. It gets funding from AIB (majority state owned) and the department of housing (state). The people living in the houses have "unsustainable" mortgages and have low incomes (need to be entitled to social housing). ICare buy the loan/house off the bank and presumably the state pays a HAP style payment to ICare and the debtor surrenders ownership and pays a local authority rent to ICare or the local authority.

It's a repossession to save face for the debtor. if the bank actually kicked them out, there would be no where for them to go with the lack of social housing available so is a "clean solution" so to speak. ICare's concern now is likely that the haircut the bank takes on day one is lower (the non for profit pays more for the loan) but the state pays a large rent to a commercial entity that is probably outside the state.

Villa05 · 16-01-2021 6:19pm

PommieBast wrote:

These are loans in default and the "ethical" and "borrower-friendly" description to me sounds very much like some sort of repossession ban. No sane commercial outfit would take them on without a huge discount.

How is it any different to investment funds hovering up social housing with guaranteed income in the form of long term leases from the taxpayer

When your government is throwing away taxpayers money, there is always entities primed to lap it up

combat14 · 16-01-2021 6:32pm

serious concerns irish economy about to be brought to its needs very shortly with brexit tape resulting in many jobs losses here

https://www.google.com/amp/s/www.irishtimes.com/business/economy/brexit-red-tape-if-nothing-changes-ireland-will-be-closed-1.4458597%3fmode=amp

PommieBast · 16-01-2021 6:50pm

Villa05 wrote: »

How is it any different to investment funds hovering up social housing with guaranteed income in the form of long term leases from the taxpayer

With social housing payment is guaranteed, which is not the case with owner-occupiers who have already defaulted.

Cyrus · 16-01-2021 7:52pm

combat14 wrote: »

serious concerns irish economy about to be brought to its needs very shortly with brexit tape resulting in many jobs losses here

https://www.google.com/amp/s/www.irishtimes.com/business/economy/brexit-red-tape-if-nothing-changes-ireland-will-be-closed-1.4458597%3fmode=amp

According to the hauliers who are annoyed with how things are going at the port.

Some of these posts strike me that the poster is hoping the economy is brought to its knees (or further to its knees maybe lying down ). Strange outlook to have.

Villa05 · 16-01-2021 8:23pm

Cyrus wrote:

Some of these posts strike me that the poster is hoping the economy is brought to its knees (or further to its knees maybe lying down ). Strange outlook to have.

Our attitude and failure to learn with housing will get us to that destination, so you are not too far wrong

combat14 · 16-01-2021 9:04pm

Cyrus wrote: »

According to the hauliers who are annoyed with how things are going at the port.

Some of these posts strike me that the poster is hoping the economy is brought to its knees (or further to its knees maybe lying down ). Strange outlook to have.

no just being pragmatic about the risk of would be mortgage holders over spending/ stretching themselves on over priced houses with the uncertainties that exist in an ongoing global covid pandemic & brexit world

hometruths · 16-01-2021 9:05pm

Cyrus wrote: »

According to the hauliers who are annoyed with how things are going at the port.

Some of these posts strike me that the poster is hoping the economy is brought to its knees (or further to its knees maybe lying down ). Strange outlook to have.

combat14 may have substantial capital at his disposal, and would welcome a downturn in economy in order to invest that capital in assets at cheaper prices hoping to increase his net wealth. The suffering of others or society at large does not concern everybody.

If so, it would be a perfectly rational outlook for an individual to have.

No different to those who hope that property prices continue to rise hoping to increase their net wealth. They are not concerned whether rising prices causes the suffering of others or society at large.

Timing belt · 16-01-2021 9:22pm

schmittel wrote: »

combat14 may have substantial capital at his disposal, and would welcome a downturn in economy in order to invest that capital in assets at cheaper prices hoping to increase his net wealth. The suffering of others or society at large does not concern everybody.

If so, it would be a perfectly rational outlook for an individual to have.

No different to those who hope that property prices continue to rise hoping to increase their net wealth. They are not concerned whether rising prices causes the suffering of others or society at large.

The only people to benefit from rising property prices are landlords or someone that is planning on emigrating.

For the normal householder it makes no difference because if they sell they will get more but likewise will need more to buy another place. Likewise for the individual looking to buy a 'home' will have lost out if they have capital at their disposal and continue to pay rent. To be financially better off house prices would really need to collapse/
For example if they were waiting 5 years and paid an average rent of 2000 Euro a month (assume a 3 bed worth 350k today) then they would need property prices to drop by 35% to equal the amount they paid on rent. At the same time they lost out on 5 years of repayments and a opportunity to buy cheaper if property prices don't collapse.

The idea of wanting the economy to collapse so that prices fall would only benefit someone who was shielded from a loss in income and on a guaranteed job for life.

Cyrus · 16-01-2021 9:28pm

schmittel wrote: »

combat14 may have substantial capital at his disposal, and would welcome a downturn in economy in order to invest that capital in assets at cheaper prices hoping to increase his net wealth. The suffering of others or society at large does not concern everybody.

If so, it would be a perfectly rational outlook for an individual to have.

No different to those who hope that property prices continue to rise hoping to increase their net wealth. They are not concerned whether rising prices causes the suffering of others or society at large.

Hoping for a substantial downturn in the economy , which lets face it will impact the lower paid the worst as these things always do, strikes me as a very strange sentiment and very selfish.

I personally don’t care if prices rise or not, as my house is a home not an asset , and if I sell it whatever I want to buy will have increased also so I won’t be any better off.

Any why are you answering for him anyway ?

2021 Irish Property Market chat - *mod warnings post 1*

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2021 Irish Property Market chat - mod warnings post 1