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05-01-2018, 09:52   #31
Rothmans
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Originally Posted by koheim View Post
Morgage interest rates in Ireland will not go up, but significally down. Irish Banks are still charging 100% more than the EU average for your interest on morgages (and I really do not understand how they get away with this). Even if ECB put their interest rate up, I would argue that Irish Banks can not follow as they are already making insane profits. The backlash from the tracker morgage scandal will keep them in check and hopefully we will see better interest rates in the next few years. Money is cheap everywhere but Ireland at the moment, an interest rate of 1,8% would make housing a lot cheaper...this would benefit the society as a whole.
I think you might be giving Irish banks a bit too much credit!!
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05-01-2018, 09:52   #32
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Originally Posted by koheim View Post
Morgage interest rates in Ireland will not go up, but significally down. Irish Banks are still charging 100% more than the EU average for your interest on morgages (and I really do not understand how they get away with this). Even if ECB put their interest rate up, I would argue that Irish Banks can not follow as they are already making insane profits. The backlash from the tracker morgage scandal will keep them in check and hopefully we will see better interest rates in the next few years. Money is cheap everywhere but Ireland at the moment, an interest rate of 1,8% would make housing a lot cheaper...this would benefit the society as a whole.
Mortgage rates are as low as they can get due to the level of non-performance on the Balance Sheets, and banks aren't interested in making "housing a lot cheaper", they are concerned with maximising shareholder value. The repossession steps required in this country are quite cumbersome which means it takes years before a bank can realise cash on some assets. Without changes to the legal process there is no way rates will come down "significantly", not a chance! I think we're just about bottomed out in the interest rate space here, so I wouldn't be expecting any big savings if that's what you're holding out for. You can expect them to go up.
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05-01-2018, 10:20   #33
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Originally Posted by koheim View Post
Morgage interest rates in Ireland will not go up, but significally down. Irish Banks are still charging 100% more than the EU average for your interest on morgages (and I really do not understand how they get away with this). Even if ECB put their interest rate up, I would argue that Irish Banks can not follow as they are already making insane profits. The backlash from the tracker morgage scandal will keep them in check and hopefully we will see better interest rates in the next few years. Money is cheap everywhere but Ireland at the moment, an interest rate of 1,8% would make housing a lot cheaper...this would benefit the society as a whole.
Mortgage rates are as low as they can get due to the level of non-performance on the Balance Sheets, and banks aren't interested in making "housing a lot cheaper", they are concerned with maximising shareholder value. The repossession steps required in this country are quite cumbersome which means it takes years before a bank can realise cash on some assets. Without changes to the legal process there is no way rates will come down "significantly", not a chance! I think we're just about bottomed out in the interest rate space here, so I wouldn't be expecting any big savings if that's what you're holding out for. You can expect them to go up.
It seems like most people are defending the Bank's high interest rates, and I do not understand why. Cheaper credit would benefit everyone. Also, the Banks were actually bailed out already for the mistakes they did pre 2009, I doubt that there are many mortgages starting after 2009 in Arrears?. The pre 2009 has been dealt with in the bail out, but still Banks are using this excuse to collectivly (like a cartel) keeping morgage interest rates artificial high, it is like an extra tax at this stage.
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05-01-2018, 10:28   #34
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It seems like most people are defending the Bank's high interest rates, and I do not understand why. Cheaper credit would benefit everyone. Also, the Banks were actually bailed out already for the mistakes they did pre 2009, I doubt that there are many mortgages starting after 2009 in Arrears?. The pre 2009 has been dealt with in the bail out, but still Banks are using this excuse to collectivly (like a cartel) keeping morgage interest rates artificial high, it is like an extra tax at this stage.
We're not defending Irish banking institutions high interest rates- we're explaining them- there is a vast difference.
I could get a mortgage tomorrow in any other EU country- at a lower interest rate than here- because the cost of lenders doing business here- is so much higher- particularly when you factor non-performing loans into the equation- than in any other EU country.

Even now- we have 10% of all mortgages in an impaired state- versus a 'normal' level of between 3 and 4% (and this is despite instructions from the ECB to get our houses in order).

Bank valuations are going up- and shareholders have a reasonable expectation of getting a return on their investment.

Keeping 10% of non-performing loans on their balance sheets- has a cost- a cost that the good customers of Irish financial institutions have to pay.

If you want Irish interest rates to come down- it implies you normalise banking practices in this country- which implies vastly loosening the ability of lenders to repossess properties with non-performing loans in lien on them- and in the case of the residential letting sector- vastly enhancing the ability of landlords to gain vacant possession of properties with overholding tenants (regardless of whether, or not, they are paying their rent).

The high cost of loans in Ireland- is a direct response of government action in Ireland- which safeguards people in their homes, both owners and tenants- regardless of whether or not they are paying their way. Thats all well and good- however, there is a cost associated with this- a cost that the normal borrowers of this country are forced to pay.
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05-01-2018, 10:28   #35
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Originally Posted by koheim View Post
It seems like most people are defending the Bank's high interest rates, and I do not understand why. Cheaper credit would benefit everyone. Also, the Banks were actually bailed out already for the mistakes they did pre 2009, I doubt that there are many mortgages starting after 2009 in Arrears?. The pre 2009 has been dealt with in the bail out, but still Banks are using this excuse to collectivly (like a cartel) keeping morgage interest rates artificial high, it is like an extra tax at this stage.
I don't think people are defending banks, that's just the reality. I think you've probably got a bit caught up in conspiracy theories. I can tell you now that there are also thousands of mortgages which originated after 2009 in arrears. I'm not sure you fully understand though, what would cheaper credit do? Are you aware of the factors which created the last crisis?
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05-01-2018, 11:33   #36
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According to the chief economist at Davy:



Personally I don't expect prices to drop in 2018. Demand is still significantly outstripping supply and mortgage approvals are increasing.

I do expect increases at the upper middle end of the market to be tempered slightly as central bank ceilings are hit.
Yes it’s the same thing every year. Things cool down from September in as mortgage exceptions get depleted, and then the number of potential buyers falls gradually as those who wanted a place before the start of school are sorted, and people get in Christmas planning mood and enjoy their end of year holiday.

It then picks-up again a few weeks after Christmas.

That’s my experience anyway.

Last edited by Bob24; 05-01-2018 at 11:36.
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05-01-2018, 12:09   #37
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Yes it’s the same thing every year. Things cool down from September in as mortgage exceptions get depleted, and then the number of potential buyers falls gradually as those who wanted a place before the start of school are sorted, and people get in Christmas planning mood and enjoy their end of year holiday.

It then picks-up again a few weeks after Christmas.

That’s my experience anyway.
Yup- its a seasonal thing.
No particular reason to believe this year is any different- its following a pattern well established over the past years..........
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05-01-2018, 12:24   #38
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Yes it’s the same thing every year. Things cool down from September in as mortgage exceptions get depleted, and then the number of potential buyers falls gradually as those who wanted a place before the start of school are sorted, and people get in Christmas planning mood and enjoy their end of year holiday.

It then picks-up again a few weeks after Christmas.

That’s my experience anyway.
That's always been the pattern. It's not just because of excemptions
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05-01-2018, 13:35   #39
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Originally Posted by The_Conductor View Post
We're not defending Irish banking institutions high interest rates- we're explaining them- there is a vast difference.
I could get a mortgage tomorrow in any other EU country- at a lower interest rate than here- because the cost of lenders doing business here- is so much higher- particularly when you factor non-performing loans into the equation- than in any other EU country.

Even now- we have 10% of all mortgages in an impaired state- versus a 'normal' level of between 3 and 4% (and this is despite instructions from the ECB to get our houses in order).

Bank valuations are going up- and shareholders have a reasonable expectation of getting a return on their investment.

Keeping 10% of non-performing loans on their balance sheets- has a cost- a cost that the good customers of Irish financial institutions have to pay.

If you want Irish interest rates to come down- it implies you normalise banking practices in this country- which implies vastly loosening the ability of lenders to repossess properties with non-performing loans in lien on them- and in the case of the residential letting sector- vastly enhancing the ability of landlords to gain vacant possession of properties with overholding tenants (regardless of whether, or not, they are paying their rent).

The high cost of loans in Ireland- is a direct response of government action in Ireland- which safeguards people in their homes, both owners and tenants- regardless of whether or not they are paying their way. Thats all well and good- however, there is a cost associated with this- a cost that the normal borrowers of this country are forced to pay.
Completely agree, the sooner we regularize our housing sector the better for all involved. We have this bizarre notion that everybody should be housed where they want no matter what and they should not be held accountable for their actions.

It's society's responsibility to give them what they want.
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05-01-2018, 15:16   #40
Colonel Claptrap
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Originally Posted by koheim View Post
Also, the Banks were actually bailed out already for the mistakes they did pre 2009, I doubt that there are many mortgages starting after 2009 in Arrears?. The pre 2009 has been dealt with in the bail out, but still Banks are using this excuse to collectivly (like a cartel) keeping morgage interest rates artificial high, it is like an extra tax at this stage.
Banks didn't clear their books in 2009 and start fresh. People defaulted and continue to default every day.

Also not all bad debts were packaged up and bailed out. Only those in severe difficulty with little to no chance of restarting repayments.

The bulk of this bad debt was commercial loans. Mortgage debt was only part of the bailout.

Last edited by Colonel Claptrap; 05-01-2018 at 15:25.
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05-01-2018, 16:47   #41
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Yes it’s the same thing every year. Things cool down from September in as mortgage exceptions get depleted, and then the number of potential buyers falls gradually as those who wanted a place before the start of school are sorted, and people get in Christmas planning mood and enjoy their end of year holiday.

It then picks-up again a few weeks after Christmas.

That’s my experience anyway.
The central bank also relaxed the rules in Jan 2017 for first time buyers to only need a 10% overall deposit. Previously they needed 20% on anything over 220k. Coupled in with the Help to Buy scheme I’d imagine this added quite a few new buyers at the beginning of the year.
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05-01-2018, 16:55   #42
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We've been looking 2 years and there was a definite big upswing in the amount of other people looking from early 2017.

I wish to god now that we had bought one of the first 5 houses we viewed, we were too picky and it took us a while to decide what & where we really wanted to buy. Meanwhile I would say the price difference in properties is 20k higher than it was when we started.
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05-01-2018, 20:17   #43
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Talking to a commuter belt estate agent today and he was saying it has definitely plateau'd (is that a word?!) Out the last 5 months or so.
He has a few new developments to sell and was saying they are selling slowly, nobody queuing up etc. The builders can only get finance off glorified loan sharks at big interest rates and the loan sharks are the real ones making the money.

Coupled with the fact that home sellers are believing the hype and think they'll get an extra 10 or 15 % next year so hold off.
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06-01-2018, 16:46   #44
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http://www.thejournal.ie/property-pr...84492-Jan2018/

What are people’s thoughts here? Predictions for increases through this year, with Limerick suburbs expecting up to a 20% rise?
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06-01-2018, 17:04   #45
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http://www.thejournal.ie/property-pr...84492-Jan2018/

What are people’s thoughts here? Predictions for increases through this year, with Limerick suburbs expecting up to a 20% rise?
I get the rational for their forecasts and they might well be correct if things keep going the year the same way as they did last year, but I guess the problem with those predictions is that they get it more or less right year after year ... until they get it horribly wrong because their assumptions are made wrong due to some circonstances they didn’t or couldn’t see coming.
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