Property Market 2019

Assetbacked · 18-04-2019 6:21pm

Fol20 wrote: »

Or you change our society where home ownership is not the norm and you create a mature long term rental market. Not everyone can and should own a home.

That's very idealistic but not in line with current policy or attitudes of Irish people.

Fol20 · 18-04-2019 6:31pm

Assetbacked wrote: »

That's very idealistic but not in line with current policy or attitudes of Irish people.

Your views are very idealistic wanting everyone to get an affordable home when in reality, this will never happen. Peoples expectations of life are very different now compared to our parents. People go on multiple holidays, new cars, gadgets etc while still wanting their forever home. We are a much more modern society now and with this will come with housing situations - similar to many other western countries.

You cant nullify the cost of land, building, margin builders need to achieve and credit availability and make it get cheaper. Standards of properties where it will decrease new builds to a level of affordability you want will never happen. Everyone needs to get a cut of the money from start to finish. If you remove any part of this supply chain, the rest will fall like dominos and no houses are built.

https://www.newstalk.com/news/heres-how-much-it-costs-to-build-a-house-597037

Take a look at a sample above back in 2017. All these prices have gone up substantially then but even then builders only had a margin of circa 10pc which is extremely low for a business to operate on.

The only realistic attitude which is gradually happening is long term rentals.

Browney7 · 18-04-2019 6:38pm

Fol20 wrote: »

The only realistic attitude which is gradually happening is long term rentals.

At what rental price though? €1800 for a two bed fairly bog standard apartment when the equivalent mortgage would be far below this isn't sustainable for long term rental

padz · 18-04-2019 6:38pm

Saw this the other day, might be of some interest

Fol20 · 18-04-2019 7:03pm

Browney7 wrote: »

At what rental price though? €1800 for a two bed fairly bog standard apartment when the equivalent mortgage would be far below this isn't sustainable for long term rental

How long has it been at 1800. People have very short memories as it was only about 3-5years ago when prices ballooned to what they are today. Something of this nature will take a lot longer to settle than a few years

Assetbacked · 18-04-2019 7:27pm

Fol20 wrote: »

Your views are very idealistic wanting everyone to get an affordable home when in reality, this will never happen. Peoples expectations of life are very different now compared to our parents. People go on multiple holidays, new cars, gadgets etc while still wanting their forever home. We are a much more modern society now and with this will come with housing situations - similar to many other western countries.

You cant nullify the cost of land, building, margin builders need to achieve and credit availability and make it get cheaper. Standards of properties where it will decrease new builds to a level of affordability you want will never happen. Everyone needs to get a cut of the money from start to finish. If you remove any part of this supply chain, the rest will fall like dominos and no houses are built.

https://www.newstalk.com/news/heres-how-much-it-costs-to-build-a-house-597037

Take a look at a sample above back in 2017. All these prices have gone up substantially then but even then builders only had a margin of circa 10pc which is extremely low for a business to operate on.

The only realistic attitude which is gradually happening is long term rentals.

Fair, good point and well made.

padz · 18-04-2019 7:39pm

Separately I've been looking at San Francisco and their property bubble, literally one Street 1.5m home's next street across people are homeless,

the money that these tech companies bring in seams to screw up the economics of an area it's spoken about a lot By us property market, even when there's an ipo and a company floats on the stock market The locals are expecting a jump in house prices, also huge homeless in San Francisco, people crapping in the street...mind you I did see human feces in Dublin the other month.

as we know our gdp had a huge jump in 2015 I think because of Apple and already fb Google, air b n b, they domicile their money here and gives us a boost when in reality very little has happened, money floating around, could just as easily float somewhere else, something to think about

beauf · 18-04-2019 8:23pm

It's also because the jobs are all concentrated in a very small area in Dublin.

snotboogie · 18-04-2019 8:41pm

padz wrote: »

Separately I've been looking at San Francisco and their property bubble, literally one Street 1.5m home's next street across people are homeless,

the money that these tech companies bring in seams to screw up the economics of an area it's spoken about a lot By us property market, even when there's an ipo and a company floats on the stock market The locals are expecting a jump in house prices, also huge homeless in San Francisco, people crapping in the street...mind you I did see human feces in Dublin the other month.

as we know our gdp had a huge jump in 2015 I think because of Apple and already fb Google, air b n b, they domicile their money here and gives us a boost when in reality very little has happened, money floating around, could just as easily float somewhere else, something to think about

Austin, Singapore (if you are a local) and Berlin are pretty affordable and stable given their economic power and all three are bigger tech hubs than Dublin.

Bluefoam · 18-04-2019 8:50pm

padz wrote: »

Separately I've been looking at San Francisco and their property bubble, literally one Street 1.5m home's next street across people are homeless,

the money that these tech companies bring in seams to screw up the economics of an area it's spoken about a lot By us property market, even when there's an ipo and a company floats on the stock market The locals are expecting a jump in house prices, also huge homeless in San Francisco, people crapping in the street...mind you I did see human feces in Dublin the other month.

as we know our gdp had a huge jump in 2015 I think because of Apple and already fb Google, air b n b, they domicile their money here and gives us a boost when in reality very little has happened, money floating around, could just as easily float somewhere else, something to think about

San Francisco is an anomaly... It is super wealthy, has run out of space to house people, and is still drawing a huge amount of people. It's been growing since the 70s and showing no sign of stopping. The average homeless person there is probably earning in excess of 100k

padz · 18-04-2019 9:15pm

https://www.mansionglobal.com/articles/san-francisco-median-house-price-falls-4-in-first-quarter-of-2019-200813

Forgot to add this in earlier

padz · 18-04-2019 9:25pm

snotboogie wrote: »

Austin, Singapore (if you are a local) and Berlin are pretty affordable and stable given their economic power and all three are bigger tech hubs than Dublin.

Cool well given the rental graph I posted earlier Germany would be a good move for someone renting in Dublin working in tech

Here it is again... My point earlier about single renting professionals leaving

Fol20 · 18-04-2019 10:27pm

padz wrote: »

Cool well given the rental graph I posted earlier Germany would be a good move for someone renting in Dublin working in tech

Here it is again... My point earlier about single renting professionals leaving

I know some rentals where i invest have increased 90 - 100pc since 2014 so 25/30pc actually seems low.

JJJackal · 19-04-2019 8:58am

Fol20 wrote: »

I know some rentals where i invest have increased 90 - 100pc since 2014 so 25/30pc actually seems low.

Its hard to tell re increase in rentals imo - some have no doubt increased >30%; some have increased <25% eg landlords caught in RPZ who did not increase rent prior to introduction of RPZ

Think 30% average is probably fair enough

Dolbhad · 20-04-2019 7:36pm

Anybody who might have been on the property boards for last number of years find any economists any good? I see Ronan Lyons popping up a lot of independent articles and wondering if anybody have those they think tend to be more clued in with the market.

The_Conductor · 20-04-2019 8:26pm

Dolbhad wrote: »

Anybody who might have been on the property boards for last number of years find any economists any good? I see Ronan Lyons popping up a lot of independent articles and wondering if anybody have those they think tend to be more clued in with the market.

Economists are great at dissecting what has happened- but just like anyone else at trying to predict the future. Even the poster boys of the boom and bust- were predicting a bust for a decade before it actually happened. I do love to read a good description of what has happened- and Economists excel at this type of commentary- however, predictions- well, they may as well be staring into the same crystal ball as you or I.

Bob24 · 20-04-2019 8:51pm

Dolbhad wrote: »

Anybody who might have been on the property boards for last number of years find any economists any good? I see Ronan Lyons popping up a lot of independent articles and wondering if anybody have those they think tend to be more clued in with the market.

The two names which has some credibility with me are David McWilliams and Ronan Lyons.

Now it doesn’t mean they are always right, and they are no better than fortune tellers at predicting the unpredictable (I.e. they can call out potential risks and malfunctions with the current property market, but they can’t predict the evolution of all the external factors which have an influence on the market).

klaaaz · 20-04-2019 10:05pm

Ronan Lyons(was(still produces reports) part of Daft) was disastrous at the last crash, we need a distinguishing figure like Morgan Kelly to tell it like it is without a vested interest/personal financial gain at heart.

Bob24 · 20-04-2019 10:22pm

klaaaz wrote: »

Ronan Lyons(was(still produces reports) part of Daft) was disastrous at the last crash, we need a distinguishing figure like Morgan Kelly to tell it like it is without a vested interest/personal financial gain at heart.

Did he make incorrect predictions then or support the idea that the only way was up? If yes I’d reconsider the way I look at him, but I think the Daft reports are just documenting a snapshot of the market for the previous few months?

Nikki Sixx · 22-04-2019 12:00pm

JJJackal wrote: »

Its hard to tell re increase in rentals imo - some have no doubt increased >30%; some have increased <25% eg landlords caught in RPZ who did not increase rent prior to introduction of RPZ

Think 30% average is probably fair enough

Are you mad? Rents have increased 100% in Dublin

Nikki Sixx · 22-04-2019 12:02pm

Bluefoam wrote: »

San Francisco is an anomaly... It is super wealthy, has run out of space to house people, and is still drawing a huge amount of people. It's been growing since the 70s and showing no sign of stopping. The average homeless person there is probably earning in excess of 100k

Cork and Dublin have tech bubbles, that have driven rents through the roof. These cities can’t take the numbers of foreign people coming to them for work.

Fol20 · 22-04-2019 12:03pm

Nikki Sixx wrote: »

Are you mad? Rents have increased 100% in Dublin

I would also mentioned that house prices have also increased circa 90-100pc so its all relative

devlinio · 22-04-2019 12:27pm

What would be the max you should pay for a 1 bedroom apartment in Dublin 13 near a Dart station. I know this isn't a lot of info to go off, I'm just interested in max prices people should pay for apartments.

Mad_maxx · 22-04-2019 1:11pm

Fol20 wrote: »

I would also mentioned that house prices have also increased circa 90-100pc so its all relative

Yes but rents are heading for 50% above 2006 levels, house prices are still on average 20% below peak in Dublin, yields in 2006 were under 4% and under 3% in wealthy parts of Dublin, they are at least 6% in the capital right now

Cities like Auckland (where wages are lower than Dublin) have much higher property prices, large cities have only seen house prices go one way since the turn of the century

Marcus Rashford · 22-04-2019 1:22pm

I’m not convinced that rents are up 100%. Much of the data is flawed, for example I had tenants who started paying €X and then any increases weren’t recorded with the PRTB. Then the tenant moves out and the new tenancy is registered at €Y. The PRTB does not have visibility on all of the data, so it’s a case of garbage in/garbage out. In terms of an actual example, I’ve one property that bottomed out at €1,100 and now earns €1,750 which is about the market rate. That’s a 59% increase and is about in line with what I’ve seen across the board.

Fol20 · 22-04-2019 1:34pm

Mad_maxx wrote: »

Yes but rents are heading for 50% above 2006 levels, house prices are still on average 20% below peak in Dublin, yields in 2006 were under 4% and under 3% in wealthy parts of Dublin, they are at least 6% in the capital right now

Cities like Auckland (where wages are lower than Dublin) have much higher property prices, large cities have only seen house prices go one way since the turn of the century

From the areas i invest in, i would estimate the increase is closer to 30pc since 2006 but thats only my own local opinion and not based on a macro level observation.

I see what you are saying however the environment has completely changed since then.
- Houses prices were unsustainable then and was fueled by excess credit.
- Yields of 3/4pc is no longer acceptable when better returns can be gained elsewhere.
- Taxation and maintenance has increased substantially. I would estimate at least 10-20pc higher.
- Risk has increased with more legislation, better tenant protections and compensation claims etc.
- We have a large demographic of accidental ll that are only now starting to get out of the market.
- You would think that if the rental industry was so lucrative, the market would increase however it is declining where very few new ll are getting into the market with the exception of REITs however they cannot take up all the slack an an entire industry that still has a majority of small time ll.
- The housing market as a whole is in a completely different situation right now with now end of pain insight.

Samuel T. Cogley · 25-04-2019 9:36am

devlinio wrote: »

What would be the max you should pay for a 1 bedroom apartment in Dublin 13 near a Dart station. I know this isn't a lot of info to go off, I'm just interested in max prices people should pay for apartments.

Look at the daft report, it will tell you what the rent is for a given Dublin postcode, then add a bit for proximity to the Dart.

beauf · 25-04-2019 9:42am

Fol20 wrote: »

....
- Houses prices were unsustainable then and was fueled by excess credit.
- Yields of 3/4pc is no longer acceptable when better returns can be gained elsewhere....

Any suggestions where better returns are likely?

Nikki Sixx · 25-04-2019 9:47am

Bob24 wrote: »

The two names which has some credibility with me are David McWilliams and Ronan Lyons.

Now it doesn’t mean they are always right, and they are no better than fortune tellers at predicting the unpredictable (I.e. they can call out potential risks and malfunctions with the current property market, but they can’t predict the evolution of all the external factors which have an influence on the market).

McWilliams was hailed as the great predictor of the last bust. I was too out of the loop at the time, to pass comment on that period. I think he has all bases covered for either a crash or continuing boom, over the next few years. I find him to be a spoofer to be honest. He’s obviously well educated and well spoken. He’s posh and light years ahead of Eddie “buy gold” Hobbs. But ultimately I feel he is full of it.

Graham · 25-04-2019 10:08am

Marcus Rashford wrote: »

I’m not convinced that rents are up 100%. Much of the data is flawed, for example I had tenants who started paying €X and then any increases weren’t recorded with the PRTB. Then the tenant moves out and the new tenancy is registered at €Y. The PRTB does not have visibility on all of the data, so it’s a case of garbage in/garbage out. In terms of an actual example, I’ve one property that bottomed out at €1,100 and now earns €1,750 which is about the market rate. That’s a 59% increase and is about in line with what I’ve seen across the board.

Even if 100% is correct, you have to ask 100% from when.

There were a few years where property could be purchased for a fraction of its build cost, likewise there were properties being rented at completely unsustainable rents.

In short, benchmarking against rents in a global financial meltdown is a pretty meaningless exercise.

OwlsZat · 25-04-2019 6:40pm

Saying that prices are unsustainable now they are climbing back to peak levels is wrong. We were in a global financial meltdown then but wages have now grown to make the prices affordable for the borrowers who are buying property.

The_Conductor · 25-04-2019 7:05pm

OwlsZat wrote: »

Saying that prices are unsustainable now they are climbing back to peak levels is wrong. We were in a global financial meltdown then but wages have now grown to make the prices affordable for the borrowers who are buying property.

Plenty of people have not experienced wage growth- its been limited to a select few sectors- notably finance and IT. Its simply not the case that wage growth has occurred across the board- and its very short sighted to suggest that this is the case.

Fol20 · 25-04-2019 8:58pm

The_Conductor wrote: »

Plenty of people have not experienced wage growth- its been limited to a select few sectors- notably finance and IT. Its simply not the case that wage growth has occurred across the board- and its very short sighted to suggest that this is the case.

I think owls was pointing out that even though houses prices have increased. They are still sustainable as some people can still afford current prices. It was more of a broad comment towards people that are buying houses(IT and finance) rather than towards people that are not buying ( other sectors where growth isnt as significant)

skippy123! · 25-04-2019 9:36pm

I am living in Ireland for 5 years now (originally from Croatia). When I moved in rent was 1050. I pay now 1500. Rent has increased - that is for sure but I wouldn't say 100% (maybe only that sort of "special" landlords). I am just going to give a comparison on salary - average price of property in a city from Croatia.

Average pay in Croatia is around 700 euro a month. Average price of a 2 bedroom apartment in Capital is 120 000 euro.
Average pay in Ireland is around 2500 euro a month. Average price of a 2 bedroom apartment in Dublin is 250 000 euro.

I think considering ranges between pay and price of average property is still pretty reasonable in Ireland comparison to some other country's.

Mad_maxx · 25-04-2019 10:00pm

skippy123! wrote: »

I am living in Ireland for 5 years now (originally from Croatia). When I moved in rent was 1050. I pay now 1500. Rent has increased - that is for sure but I wouldn't say 100% (maybe only that sort of "special" landlords). I am just going to give a comparison on salary - average price of property in a city from Croatia.

Average pay in Croatia is around 700 euro a month. Average price of a 2 bedroom apartment in Capital is 120 000 euro.
Average pay in Ireland is around 2500 euro a month. Average price of a 2 bedroom apartment in Dublin is 250 000 euro.

I think considering ranges between pay and price of average property is still pretty reasonable in Ireland comparison to some other country's.

House prices in Dublin are not especially high for such a wealthy city, rents are very high however

OwlsZat · 25-04-2019 10:27pm

I think the Cuckoo fund issue might be enough to see FG swap places with FF come next election. The idea that we had to bring them in to finance building apartments when the Government could have provided developers with the finance is daft beyond belief. I expect they will be forced to rollback on this stance eventually.

myshirt · 25-04-2019 11:24pm

OwlsZat wrote: »

The idea that we had to bring them in to finance building apartments when the Government could have provided developers with the finance is daft beyond belief. I expect they will be forced to rollback on this stance eventually.

Do you want to expand on that? It's quite a bizarre comment. What are you on about and do you understand what you're saying?

How is shifting some risk to international money markets and away from the State Balance sheet daft beyond belief?

Separately, this whole country was built on other people's money, including the money of the Catholic Church at one point when we hadn't as much as a washer in our arse pocket. Other people's money has allowed the country to become what it is, and we are developing indigenous business off the back of it and quite a strong well educated labour force of young Irish people compared to their chancers of parents (baby boomers).

Assetbacked · 26-04-2019 12:24am

myshirt wrote: »

Do you want to expand on that? It's quite a bizarre comment. What are you on about and do you understand what you're saying?

How is shifting some risk to international money markets and away from the State Balance sheet daft beyond belief?

Separately, this whole country was built on other people's money, including the money of the Catholic Church at one point when we hadn't as much as a washer in our arse pocket. Other people's money has allowed the country to become what it is, and we are developing indigenous business off the back of it and quite a strong well educated labour force of young Irish people compared to their chancers of parents (baby boomers).

I agree with this. I think we are well poised in the event of a global recession as the institutionals invested in the property market are the ones which will feel it and they consist of foreign money. This presumably was the stance taken considering the devastation caused by the crash.

OwlsZat · 26-04-2019 11:05am

Assetbacked wrote: »

I agree with this. I think we are well poised in the event of a global recession as the institutionals invested in the property market are the ones which will feel it and they consist of foreign money. This presumably was the stance taken considering the devastation caused by the crash.

If the money is being sought because a recession is inevitable then fine by me. Most on this thread believe there won't be a recession / repeat financial collapse. If there isn't they had better flip the tax laws so the state benefits or it forces them to sell. The idea of a generation of Irish paying rent though the nose to line the pockets of foreign pension funds gets my goat. The incumbent government has shown zero regard for the young employees in this country.

Amirani · 26-04-2019 11:09am

OwlsZat wrote: »

If the money is being sought because a recession is inevitable then fine by me. Most on this thread believe there won't be a recession / repeat financial collapse. If there isn't they had better flip the tax laws so the state benefits or it forces them to sell. The idea of a generation of Irish paying rent though the nose to line the pockets of foreign pension funds gets my goat. The incumbent government has shown zero regard for the young employees in this country.

You haven't read this thread then.

You don't seem to have a coherent point here. Do you believe that taxpayers should be funding developers' speculative investments or not?

OwlsZat · 26-04-2019 11:09am

myshirt wrote: »

Do you want to expand on that? It's quite a bizarre comment. What are you on about and do you understand what you're saying?

How is shifting some risk to international money markets and away from the State Balance sheet daft beyond belief?

Separately, this whole country was built on other people's money, including the money of the Catholic Church at one point when we hadn't as much as a washer in our arse pocket. Other people's money has allowed the country to become what it is, and we are developing indigenous business off the back of it and quite a strong well educated labour force of young Irish people compared to their chancers of parents (baby boomers).

Your point is pointless. We took money before so we will do it again...

We have a record amount of savings in the country. We aren't short on money and the current sky high rent is being paid is to foreign accounts. We are sending rental profits overseas when there is no reason we can't invest Irish money in Ireland and pay the investors reasonable returns. However if you think a recession is inevitable and you'd rather burn foreign funds then fully understood.

OwlsZat · 26-04-2019 11:11am

Amirani wrote: »

Do you believe that taxpayers should be funding developers' speculative investments or not?

You believe that building housing in a severe housing shortage is speculative? Again are you inferring a recession is inevitable?

Amirani · 26-04-2019 11:15am

OwlsZat wrote: »

You believe that building housing in a severe housing shortage is speculative? Again are you inferring a recession is inevitable?

Developer-led property schemes are speculative, yes.

Yes, Ireland having another recession in future is inevitable.

skippy123! · 26-04-2019 6:44pm

Amirani wrote: »

Developer-led property schemes are speculative, yes.

Yes, Ireland having another recession in future is inevitable.

Realistically speaking - every market has it's up's and downs. That is just how it is. Now - other thing is how bad it will be.

Marcus Rashford · 26-04-2019 11:35pm

Calling them “cuckoo funds” is ridiculously inflammatory.

Sheeps · 26-04-2019 11:42pm

Marcus Rashford wrote: »

Calling them “cuckoo funds” is ridiculously inflammatory.

good

OwlsZat · 27-04-2019 12:03am

Marcus Rashford wrote: »

Calling them “cuckoo funds” is ridiculously inflammatory.

You're for the birds Marcus!

The_Conductor · 27-04-2019 8:54am

Marcus Rashford wrote: »

Calling them “cuckoo funds” is ridiculously inflammatory.

You sort of get an idea of the demographic the Indo were chasing for paper sales- when they coined that term.

Marcus Rashford · 27-04-2019 9:25am

The_Conductor wrote: »

Marcus Rashford wrote: »

Calling them “cuckoo funds” is ridiculously inflammatory.

You sort of get an idea of the demographic the Indo were chasing for paper sales- when they coined that term.

Yep...it’s a veritable aviary out there!

Assetbacked · 27-04-2019 10:43am

David McWilliams' article in the IT today. While he has been banging this drum for a good while now, I haven't seen him so conclusive with his statements before. https://www.irishtimes.com/opinion/david-mcwilliams-young-workers-feel-anxious-about-the-future-and-rightly-so-1.3871582?mode=amp

"The policy decision not to tax the primary source of wealth naturally encourages people to regard housing as a source of wealth that won’t be touched.

The obvious implication of this is that more and more capital goes into property, driving up its price, pushing up the cost of living for the heavily taxed workers, cutting their disposable income, making them feel anxious while on paper at least looking comfortable."

"Now look at how much is raised from property, the single biggest source of wealth in the country? A mere €500 million or 1 per cent of the tax take comes from property, despite the fact that we know that 87 per cent of the wealth of the country is tied up in houses, land or property.

These are the extraordinary facts about life in Ireland today. We insist on seeing accommodation as an asset, not a weekly cost. Therefore we have an inbuilt bias to push up its prices. This excludes young couples from the market, making them fretful and compelling them to push life’s milestones out further.

We know this, so you would imagine that we would tax property and land to rectify the problem. But we do precisely the opposite. We tax wages 40 times more heavily than property, implying that the average worker is penalised for working and effort, while the property owner is subsidised for doing nothing and watching prices rise."

Property Market 2019

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