Are Landlords really getting these prices

CiaranC · 01-03-2011 2:04pm

gerryo777 wrote: »

How low do people on here think property prices will go? Do you think that they will go back to the 70's or 80's prices? Do you think that you will be able to buy in Dublin for 50 or 60k??? COP ON TO YOURSELVES! We're in a recession, but we are not heading back to the dark ages!

There will be housing in Ireland with a negative value, ala Detroit, Michigan.

Theres another side to the rental prices debate here. There was a chap on here on another thread living in a 1 bed apartment on his own paying 1000 euro a month in rent. Twelve grand a year in rent alone. He was convinced that this was normal. He was also complaining that Ireland was horrendously expensive to live in and that prices had not come down since the recession. He actually had a right go when I suggested that this might be because he was starting off down twelve grand when he didnt have to be.

Although its not exactly scientific, the average being paid in rent a year per person seems to be about 3600 a year according to the poll on this forum.

How many of these guys are out there, and how much are they skewing the market? I suspect he is not alone. Im in a nice 1 bed atm, there are some around the corner renting for 40% more than I am paying and they are not coming down in price as far as I can see.

antiskeptic · 01-03-2011 2:06pm

Monty Burnz wrote: »

Are Irish people still really sticking their fingers in their ears rather than facing up to reality? You would think the bubble would have taught people a lesson, but apparently not.

I'm reminded of the saying that goes something like:

It's hard to get a man to believe something when his livelihood depends upon him not believing it.

You can't help but be sympathetic though. This isn't an over-indulgent holiday or a flash car fallen for. This concerns the most significant asset anyone could ever purchase and folk have been left utterly high and dry. All because they got caught up in a vested-interest fuelled panic-buying.

I was subject to that exact same influence myself - the only difference being it's occurance in 1999 in my case. Before the then-insane house price inflation went stratospheric.

gerryo777 · 01-03-2011 2:31pm

Monty Burnz wrote: »

Are Irish people still really sticking their fingers in their ears rather than facing up to reality? You would think the bubble would have taught people a lesson, but apparently not.

We're f***ed so, may as well hand it back to the brits!! Sure we're never going to get out of this mess, oh the doom, the doom!!!!

CiaranC · 01-03-2011 2:33pm

gerryo777 wrote: »

We're f***ed so, may as well hand it back to the brits!! Sure we're never going to get out of this mess, oh the doom, the doom!!!!

You are saying that sarcastically like it is not true. We are indeed "****ed", as you so eloquently put it.

Monty Burnz · 01-03-2011 2:38pm

gerryo777 wrote: »

We're f***ed so, may as well hand it back to the brits!! Sure we're never going to get out of this mess, oh the doom, the doom!!!!

I bet you were saying the same thing in 2006 - how has that worked out for you?

Incidentally, you appear to have no argument to back up your apparent notion that things are actually fine, or at least if you do you haven't chosen to share it. I can't wait to hear it.

gerryo777 · 01-03-2011 3:03pm

Monty Burnz wrote: »

I bet you were saying the same thing in 2006 - how has that worked out for you?

Incidentally, you appear to have no argument to back up your apparent notion that things are actually fine, or at least if you do you haven't chosen to share it. I can't wait to hear it.

Worked out ok, still have a job (not a civil servant) in the real world. Still paying my bills, still alive so yea, working out ok.
I never said things were actually fine, what I'm trying to put across is that as a people we need to change our attitude or we'll never get out of this mess. Anyway this is heading off topic..............

reprazant · 01-03-2011 3:05pm

So maybe we should all think positive thoughts and maybe the ECB won't raise the interest rates?

Monty Burnz · 01-03-2011 3:09pm

gerryo777 wrote: »

I never said things were actually fine, what I'm trying to put across is that as a people we need to change our attitude or we'll never get out of this mess. Anyway this is heading off topic..............

Fair enough, but we have to change our attitude to a realistic one, rather than an emotion-driven one. At present, realistically, we are goosed. This view is based on fact, as I argued above. As soon as the facts change, I will change my view.

hinault · 01-03-2011 3:13pm

Monty Burnz wrote: »

Don't forget that rent allowance distorts the market by putting an artificially high floor on rents. Thus, any kind of kip of bedsit at all will cost 400 euros, whereas in (wealthy, non-IMF-run) Berlin, 400 will get you a nice 2 bed apartment.

The state pays for half of all rented accommodation in this country - if we saw the rent allowance slashed, then landlords could not rely on getting a bare minimum of 400 plus for any dump, and rents would fall for everyone (including those on rent allowance of course). We'd be saving the state a fortune and allowing private renters to rent at lower prices (giving them more spending money to pour back into the economy). The downside would be that struggling BTL owners might go bust - but I don't see why it's fair to distort the market and screw everyone else for the benefit of landlords.

I agree with you 100%.

The Sunday Times Business section stated two weeks ago that the banks are now saying that the loan to let mortgages are starting to come under pressure.

The increase in the variable interest rate and the new higher fixed rate mortgages are going to impact existing loan to let market.
Mortgage repayments will increase and landlords might try to increase repayments.
If they don't increase rents, then the landlords will have to finance the difference between the rent collected and the mortgage repayment.

gerryo777 · 01-03-2011 3:42pm

Monty Burnz wrote: »

Fair enough, but we have to change our attitude to a realistic one, rather than an emotion-driven one. At present, realistically, we are goosed. This view is based on fact, as I argued above. As soon as the facts change, I will change my view.

Thats a fair point, but the reality is that the IMF deal will be renegotiated and there will have to be a europe wide answer to the banks problems. We can't/won't be landed with a €10 billion interest bill every year because that will bankrupt Ireland and if Ireland goes down then the whole EU will follow pretty quick after that.

Godge · 01-03-2011 7:26pm

gerryo777 wrote: »

How low do people on here think property prices will go? Do you think that they will go back to the 70's or 80's prices? Do you think that you will be able to buy in Dublin for 50 or 60k??? COP ON TO YOURSELVES! We're in a recession, but we are not heading back to the dark ages!

Simple answer to your question. When prices and rents in Dublin fall back to the levels of a small provincial European city, think Montpelier, Turin, Newcastle etc, then we will have reached the bottom. And prices outside Dublin will need to be less than that.

Remember all those comparisons in the Irish Times and Sunday Times where they showed you what €1m could buy in France or Spain as compared to Dublin e.g. a villa on 20 acres in France for the price of a 2-bed apartment in Ringsend. When those comparisons look reasonable the EU/IMF will be happy we have reached the bottom.

Benedict · 01-03-2011 10:19pm

The crucial question is this - forget the asking prices, how much are sellers actually accepting?

magneticimpulse · 02-03-2011 3:29pm

gerryo777 wrote: »

How low do people on here think property prices will go? Do you think that they will go back to the 70's or 80's prices? Do you think that you will be able to buy in Dublin for 50 or 60k??? COP ON TO YOURSELVES! We're in a recession, but we are not heading back to the dark ages!

Yeah I do think we ABSOLUTELY will be able to buy at these prices. Because the prices of the 80's were based on 1 person income and now...we have a similar situation where in a "couple" just 1 person might be working. Also peoples salaries didnt increase that much since the 80's like the price of property. So things will have to stablise to reflect someones income for 20 plus year mortgage. I mean the way unemployment is going, its not stable to lump someone with a 40+ year mortgage because we cannot guarantee jobs.

At the moment Ireland's economy is mainly solely based on the Pharmaceutical Manufactering bringing the country an income...any of these companies can up and leave tomorrow and start to manufacture in China/India for 4 times less.....it will be like what the sewing clothes industry was like in the 70's for Ireland!!! So yes, Ireland has a fickle economy. With the masses of "educated" young people leaving, Ireland wont have much to sell besides a few tacky souvenirs (which are imported from China). We will be rightly screwed if the likes of Pfizer, Intel, hp etc decide to pull out over the next 5 years. We already saw it with Dell. Pfizer seems really unstable at the moment...only about a month ago they closed a full site in the UK....Pfizer took over Wyeth last year and Merck took over Schering Plough last year as well...merging the companies together and these are now the 2 main players in Ireland instead of the previous 4!!! Also most of these Pharma companies have their drug patents coming to an end, meaning anyone in China can make Viagra!!! Viagra is currently made in Ireland...but im sure the patent is up soon...this is not good news because the drug companies are discovery very little at the moment. Ireland has once again put all its eggs in the one basket. You might have thought the constructing industry going bust was bad...but this is only the tip of the ice berg. I can guarentee at least some of these companies will find it cheaper to manufacture in Asia compared to Ireland....we have only seen the beginning.

Yes you could consider Ireland is going back to the dark ages...we might not depend on potatoes now, but we certainly are still depending on one thing and currently that is manufactering of pharma and IT components.

Jobs/Business/Exports = Economy...neither of these = Bust = Worthless housing prices

You CAN find property on daft.ie for 60k NOW. Not just an appartment but a 4 bed detached house in places across Ireland. So I think thats an indicator for the direction house prices are going in. There are many different types of property in Dublin and I think the "Corporation" area's will be down below that price. I could imagine people getting a "Corpo" house for 40k at the most the way things are going.

You wont even be able to compare Ireland to other economies in Europe (house prices in Europe), because France and Germany are fairly stable. France is wrapped up in Administration ....but at least they have a few Car companies and Airbus and Cosmetic/Beauty stuff. Germany has its car industry which even that wasnt doing so well a few years ago and lead to the low interest rates across europe, helping Ireland's fickle economy.

kevin99 · 02-03-2011 4:33pm

Let's look at it another way.

What specific jobs will be created over the next five years to get the 450k people back to work?
Not everybody has a third level degree. Not everyone completed their leaving cert.
So where will the jobs come from?
That's the big question.

In relation to the property market prices will fall further. However, it depends where in Dublin you want to sell or buy. Location, location is still the determining factor in persuading people to buy or sell. If you are seeking a house in an affluent area of Dublin, close to all amentities, then you will still be paying a preimum price.
Take Sandymount or indeed anywhere along the DART or LUAS lines, sellers will get more for their properties and renters will have to pay more.
But if you live in west or north west Dublin you will get less for your property and you will pay less to rent a property.

Properties prices will fall again this year but by not as much in the areas along the east coast of Dublin.

So, if someone is considering selling this year, I would suggest selling immediately, don't wait for the summer or late Spring 'cos they prices will start falling back by then.

There should be a NAMAesque debt forgiveness for people who bought their homes during the boom. I'm not talking about investment homes but homes first time buyers bought.

Omega28 · 02-03-2011 4:43pm

I'm 24, on rent allowance cause I'm entitled to it for disability, my disability is that i'v had 2 open heart surgeries.

I haven't stopped looking for a flat of decent standard for about 6 months now.
I email landlords, ring them etc and they won't even consider rent allowance, its a pain:mad:

i think that landlords stereotype people on rent allowance, and its not fair on people like myself that are trying their best to find a flat.

The places out there for around 600euro are shocking. I go visit places that even priced at 700euro and I think there better of demolishing it and rebuilding, never mind letting a human living it.

I personally think there chancers...

axer · 02-03-2011 4:49pm

kevin99 wrote: »

There should be a NAMAesque debt forgiveness for people who bought their homes during the boom. I'm not talking about investment homes but homes first time buyers bought.

Any debt forgiveness as such should come with very strict conditions e.g. that the government effectively own some of the house or something like that. Under no circumstances should the owners fair out better than renters and under no circumstances should the owners be allowed to make a profit on their home in the future.

Zamboni · 03-03-2011 11:06am

kevin99 wrote: »

There should be a NAMAesque debt forgiveness for people who bought their homes during the boom. I'm not talking about investment homes but homes first time buyers bought.

Diminishing personal responsibility and disregard of financial prudence are some of the main factors that contributed to the current state of Ireland.
Further rewarding it will not solve one single problem.

Monty Burnz · 03-03-2011 6:07pm

Dylanmc111 wrote: »

I'm 24, on rent allowance cause I'm entitled to it for disability, my disability is that i'v had 2 open heart surgeries.

I haven't stopped looking for a flat of decent standard for about 6 months now.
I email landlords, ring them etc and they won't even consider rent allowance, its a pain:mad:

i think that landlords stereotype people on rent allowance, and its not fair on people like myself that are trying their best to find a flat.

The places out there for around 600euro are shocking. I go visit places that even priced at 700euro and I think there better of demolishing it and rebuilding, never mind letting a human living it.

I personally think there chancers...

And there are tens of thousands of brand new, empty properties being deliberately kept off the market by NAMA, the tax-payer owned banks, and the developers. :mad:

Amhran Nua · 04-03-2011 9:26am

gerryo777 wrote: »

Do you think that you will be able to buy in Dublin for 50 or 60k???

There's a Temple Bar flat for €80k here.

Omega28 · 04-03-2011 10:45am

Monty Burnz wrote: »

And there are tens of thousands of brand new, empty properties being deliberately kept off the market by NAMA, the tax-payer owned banks, and the developers. :mad:

I know! this is what really gets to me:mad:

I'd love to find my own little place, its not like I'm looking for anythin special, just something comfortable.

I'm sick of going to view tiny ****holes with huge rent.

jmayo · 04-03-2011 12:26pm

OMD wrote: »

This is the point I was making earlier. Supply of rental properties is not going up but demand is so prices will rise. 2 posters have now backed this up with personal experience. just for balance, since Christmas, how many people have had their rent reduced or have seen neighbouring properties drop their rents?

I do think you are right that demand is close to supply in some areas.
I know someone trying to rent house in north Wicklow and loads of properties disappeared just after new year.
When they went to one house there were three or four couples viewing it.

Now saying that, there are some properties that have been for rent for the last few months and they are getting no one becuase the rent being asked is ridiculous.
You also find a fair few properties for rent that the owners couldn't sell.

Now IMHO this is all short term because long term the market is going to change hugely.

Things which have major bearing on property prices and rental market include:

Interest rates are going to increase.
Sooner or later the rent allowance scheme is going to be cut as spending will have to be cut.
Sooner or later the glut of property held back from the market by NAMA and banks not repossessing will have to be released and property prices will tumble.
Emigation and migration of foreign workers home.

kevin99 wrote: »

....
There should be a NAMAesque debt forgiveness for people who bought their homes during the boom. I'm not talking about investment homes but homes first time buyers bought.

No no no and no again.
Some of the so called FTBs were young singles or indeed young couples who just wanted to get a foot on the so called property ladder, the ladder to riches.
They often were not even living in the properties, but living at home with mammy and daddy.
They bought apartments, townhouses, etc in the believe that they could trade up in a few years.
I do feel sorry for young couples with children who felt they needed to buy, but that is it.
They could be accomodated with lower repayments for x number of years, but no debt forgiveness.

Why should those who did not enter into the madness pay for the poor or unlucky decisions made by others.

If you want to go down that road then should you not pay for my failed bets on the grand national or the hit I took on my pension which had invested in bank shares ?

There should never have been any bailouts.
The only banks that should have been in any way saved were AIB and BOI as they were truly systemic.

BostonB · 04-03-2011 12:39pm

The other thing that will effect it, is peoples salaries reducing, and unemployment increasing.

Monty Burnz · 04-03-2011 12:40pm

jmayo wrote: »

The only banks that should have been in any way saved were AIB and BOI as they were truly systemic.

Even then, they should not have been 'saved' in a bailout sense, but basically those who lent them the money should have taken ownership, with the shareholders (of which I was one) totally wiped out. That would have meant that we still had banks, but it wouldn't have cost the taxpayer a penny.

Are Landlords really getting these prices

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