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04-01-2019, 09:45   #46
smurgen
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Items such as manufacturing output and stock market trends are leading indicators when trying to track recessions.there is a lag between bad stuff happening in the U.S and the impact here in Ireland.
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04-01-2019, 10:08   #47
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On the rental crisis, which is what impacts the vast majority of those under the age of 35 I would say, the IT had a "state of the nation" piece from Ronan Lyons, Trinity professor of economics and author of Daft.ie reports https://www.irishtimes.com/business/...2019-1.3735706



His key points;



- "For Ronan Lyons, assistant professor of economics at Trinity College Dublin and author of the Daft.ie rent reports, the problem is still very much one of a lack of supply." Despite all the bickering and protesting etc., ultimately this is the crux of the problem.



- "While there has been an uptick in planning permissions, he says it will be 2020 at the earliest before we see any significant relief, in terms of additional supply coming on to the market." 2020 at the earliest before rent looks like it will climb down from its 1620euro average in Dublin. The year of a general election which will be interesting to see how the government will fare.



- "And where we do see new developments coming on stream, it’s often at the top end of the market....According to Lyons, the reason so many of these investors are pitching their properties at this market is because of the costs of construction...One bright spot for tenants is that he expects these institutional players to seek to bulk up significantly the volume of apartments they let over time. The only way they can realistically capture a larger market share is by offering properties at lower rental rates."



- The introduction of rent controls in 2016 created a two tier market between tenants already renting and tenants who were new to the market/moving. "Figures from the Residential Tenancies Board (RTB) show that rents for existing tenancies rose by about 5.4 per cent in the year to September – but new tenancies rose by almost 50 per cent more than that."



- On the Airbnb measures "In addition, rules limiting Airbnb lets, other than in people’s main residence, to 90 nights a year, are due to be introduced next June. These could, it is hoped, bring as many as a couple of thousand properties back into the long-term rental sector."
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04-01-2019, 10:17   #48
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Wouldn't you think that some of these so called experts would publish some real research into how rent controls have really effected the rental market.

What are they afraid of?
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04-01-2019, 10:17   #49
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Condescending answer which also shows the person who wrote it didn’t actuslly read the post they were replying to.

I am precisely saying that I think it is unlikely for people to leave en masse.
That really isn't clear from your original post... I've re-read it and your conculsion does not say vaugely that, let alone precisely.

Anyway, in relation to FB, Google at al, and their impact on Irish property prices... While they reside here, the management of the biusiness related to this island is minor, they are interested in big global swings... Their current concentration is emerging markets and they will keep people on this island busy for many years, iresepected of local recession.
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04-01-2019, 10:17   #50
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The abject glee that some seem to be displaying when talking about a recession is really strange. Why would you possibly want a downturn or the economy to do worse? This won't only result in lower property prices. People will lose their jobs etc. Banks won't lend. Companies won't invest. It's not a good thing.

It also may not even cause the reduction in property prices everyone is hoping and waiting for.
The input parameters are completely different this time.

Going into 2008 recession we had a chronic oversupply of property, with banks insanely over-leveraged on mortgages.

Going into (potential) 2019/2020 recession we have a chronic undersupply of property with much tighter lending restrictions in place for the last 4 years.


It's not going to play out the same as 2008-2013.

Last edited by Moonjet; 04-01-2019 at 10:33.
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04-01-2019, 10:19   #51
LotharIngum
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Wouldn't you think that some of these so called experts would publish some real research into how rent controls have really effected the rental market.

What are they afraid of?..
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04-01-2019, 10:44   #52
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That really isn't clear from your original post... I've re-read it and your conculsion does not say vaugely that, let alone precisely.
Here are some exemples of things to read in the post whereby I am indeed saying that:

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not only almost every person I know is still on it, but they are also all heavily relying on WhatsApp, with many on Instagram

[...]

I am not sure people care that much and will leave.

[...]

the network effect is working very well for them.

Last edited by Bob24; 04-01-2019 at 10:53.
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04-01-2019, 10:50   #53
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The whole point of many posts here is that if we had a mature attitude to the property market we would avoid the worst of the damage caused by recessions. The property market operates in a boom bust cycle by choice and government policy.
It is quiet simple to avoid these cycles and have a functioning property market
There is no evidence of the property market operating in a boom bust cycle. The economy as a whole has, but not property. Only once in the history of the state have property prices dropped at any noticable level, and that was 2009-2013. Even during the recession of the 1980s property prices weren't effected.

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It also may not even cause the reduction in property prices everyone is hoping and waiting for.
The input parameters are completely different this time.

Going into 2008 recession we had a chronic oversupply of property, with banks insanely over-leveraged on mortgages.

Going into (potential) 2019/2020 recession we have a chronic undersupply of property with much tighter lending restrictions in place for the last 4 years.


It's not going to play out the same as 2008-2013.
This is a very reasonable argument as to why even a recession won't effect property prices as much as last time. People were so heavily indebted, and it didn't even take that many people, that they were forced in to firesales to try get access to cash. People were buying one property, waiting for the equity to be built up due to rising property prices and use that as collateral for the next purchase. It was all a big house of cards that came crashing down. Now there are much stricter lending rules, the value if property could drop at least 10%, maybe 20% before there would be a big concern about negative equity.
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04-01-2019, 11:09   #54
smurgen
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Quote:
Originally Posted by Bob24 View Post
Condescending answer which also shows the person who wrote it didn’t actuslly read the post they were replying to.

I am precisely saying that I think it is unlikely for people to leave en masse.
That really isn't clear from your original post... I've re-read it and your conculsion does not say vaugely that, let alone precisely.

Anyway, in relation to FB, Google at al, and their impact on Irish property prices... While they reside here, the management of the biusiness related to this island is minor, they are interested in big global swings... Their current concentration is emerging markets and they will keep people on this island busy for many years, iresepected of local recession.

Google and fb etc may stay here but in a recession their bargaining power with employees will be alot higher and i can see wages earned being cut dramatically.
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04-01-2019, 11:13   #55
LotharIngum
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Google and fb etc may stay here but in a recession their bargaining power with employees will be alot higher and i can see wages earned being cut dramatically.
If their wages are cut significantly imagine how the wages in the rest of the country will be effected.
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04-01-2019, 11:16   #56
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Google and fb etc may stay here but in a recession their bargaining power with employees will be alot higher and i can see wages earned being cut dramatically.
They could also slow down on hiring due to reduced growth on their end.

But I think the real question is the tax regime. Voices are getting louder and louder in Brussels to harmonise taxation of these companies accross the EU. It might not go anywhere as the EU is a messy beast, but if it does this will have a huge impact on Ireland (some people might like to think tax rates are irrelevant and besides they ireland still is the single greatest country in Europe to operate EMEA headquarters, but it is far from true and while neither the government nor companies can say it publicly - law taxation is one of the main reasons they are here). Again this is pure speculation and not guaranteed to happen, but if we were force to hike-up corporate tax or even just to make sure these companies are paying the headline rate, it would probably impact employement as well as immigration of qualified workers, and in turn property prices.

Last edited by Bob24; 04-01-2019 at 11:20.
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04-01-2019, 11:20   #57
 
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They could also slow down on hiring due to reduced growth on their end.

But I think the real question is the tax regime. Voices are getting louder and louder in Brussels to harmonise taxation of these companies accross the EU. It might not go anywhere as the EU is a messy beast, but if it does this will have a huge impact on Ireland (some people might like to think tax rates are irrelevant and besides they ireland still is the single greatest country in Europe to operate EMEA headquarters, but it is far from true and while neither the government nor companies can say it publicly - law taxation is one of the main reasons they are here).
Good thing we have a veto on tax issues then isn't it.

I have absolutely no issue with discussing facts and realistic economic outlooks. But there seems to be a few in here that seem catastrophic economic collapse as inevitable, and that this collapse will somehow result in them personally getting a house for half nothing. The current landscape does not point to that, much as some would wish it. Not specifically saying you Bob btw, just a general observation.
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04-01-2019, 11:36   #58
Bob24
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Good thing we have a veto on tax issues then isn't it.

If enough countries (especially large ones like France and Germany) gang-up to change things an Irish veto means nothing.

Either they will find work arounds to change what is happening in practice without affecting rules that can be vetoed, or they can pressure ireland into the change (for exemple we have made ourselves ultra-reliant on the EU with relations to many pre and post Brexit issues which reduces our capacity to say no on other matters).

Also, keep in mind that in many European countries voters are asking for this taxation model to change and threatening to vote for anti-EU parties if nothing is done. This has already forced some governments (UK, Spain, France, Italy, Hungary, Slovakia) to act unilateraly and try to change things with national laws. The EU elections are coming and there is a real possibility that many key countries will send a majority of “populist” MEPs to the EU parliament. At some point people in Brussels and some EU capitals could very possibly think that forcing a few changes upon Ireland and of few “minor” countries is better than allowing these parties en masse in the parliament and risking them controlling more national governments.

Last edited by Bob24; 04-01-2019 at 12:47.
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04-01-2019, 11:39   #59
 
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If enough countries (especially large ones like France and Germany) gang-up to change things an Irish veto means nothing.

Either they will find work arounds to change what is appending in the ground without affecting anything that can be vetoed, or they can pressure ireland into the change (for exemple we have mad ourselves ultra-reliant on the EU with relations to many pre and post Brexit issues which reduces our capacity to say no on other matters).

Also, keep in mind that in many European countries voters are asking for this taxation model to change and threatening to vote for anti-EU parties if nothing is done. This has already forced some governments (UK, Spain, France, Italy, Hungary, Slovakia) to act unilateraly and try to change things with national laws. The EU elections are coming and there is a real possibility that many key countries will send a majority of “populist” MEPs to the EU parliament. At some point people in Brussels and some EU capitals could very possibly think that forcing a few changes upon Ireland and of few “minor” countries is better than allowing these parties en masse in the parliament and risking them countering more national governments.
They could do alright but that would be the end of the EU as we know it. Ourselves, the Dutch, Hungary and Belgium are all against tax harmonization. If it was forced down our throats the EU as it currently is wouldn't survive. It's either become the federal states of Europe or break up altogether. The effects of either are impossible to predict as it's such a huge departure from where we stand now.
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04-01-2019, 12:01   #60
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They could do alright but that would be the end of the EU as we know it.
What I’m arguing though is that we might be close to a situation whereby not doing is would be the end of the EU as we know it as well (with the European Parliament having a majority of euro sceptic MEPs, and national governments in large countries willing to change the status quo a lot more). At some point I believe it could very possibly come to choosing between the lesser evil and even our governement might decide that it is a better move to compromise on taxation matters rather that risking to break a free trade zone which is key to our economy.
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