Property Bubble Going to Burst?

cleremy jarkson

My dad was saying all the same stuff to me as the O.P was in like 2004; he knew that it was a bubble waiting to burst. Ah well, its satisfying to see the idiotic responses of some people to the O.P...the type of people who ACTUALLY thought that the standard of living that existed in this country during the boom was both normal and sustainable and deserved by us as a nation!! :rolleyes:

tbh

Poor Uncle Tom wrote: »

Moderate post, tbh....

I'm not a mod in AH tom.

Poor Uncle Tom

tbh wrote: »

I'm not a mod in AH tom.

the power of words...:rolleyes:

gurramok

Willa Stale Self-indulgence wrote: »

Lots of people made the same perdiction but it's not that hard to do, I mean, you cannot tell when this is going to happen, but it is going to happen

We all know the patient is ill. He still smokes so some of us can conclude that he will die very soon, that separates the men from the boys

irishconvert

I just read the first page of this thread, that gave me a really good laugh!

BennyBlanko

+1, it was SO mad back then........lol

ScumLord

There are still people going around today saying "it was so sudden" and "sure nobody knew we never saw it coming" and I have to laugh at these people, where you living under a rock?

Someone posted a youtube video on here of a report TV3 did in 96 or 98 saying the same thing. Our housing market was unsustainable from the beginning and I'm finding it hard to understand how the "experts" didn't know that. This country was taken for a ride by certain people and now they've gotten away with it because Irish are weak and will let people walk all over them.

This is nothing, wait until the predicted peak oil and fish stock depletions happen in the coming decades.

aDeener

ScumLord wrote: »

There are still people going around today saying "it was so sudden" and "sure nobody knew we never saw it coming" and I have to laugh at these people, where you living under a rock?

Someone posted a youtube video on here of a report TV3 did in 96 or 98 saying the same thing. Our housing market was unsustainable from the beginning and I'm finding it hard to understand how the "experts" didn't know that. This country was taken for a ride by certain people and now they've gotten away with it because Irish are weak and will let people walk all over them.

This is nothing, wait until the predicted peak oil and fish stock depletions happen in the coming decades.

joejoem's response in particular is quite hilarious.

Cant help but feel there is a lot of wonderful hindsight being floated around though at the moment. no doubt there was people who knew what was coming well in advance but there is certainly an element of being wise after the event now. im not saying you in particular just in general

BennyBlanko

Remember when all the Estate Agents were predicting a "SOFT LANDING"......lol.........then last year I heard one ejit estate agent calling the state of things in the recession as "ADVANCED PRICE CORRECTION" ........lol, such fools.

Caoimhín

The whole episode was an example of the collective madness of the population, with a few exceptions. It is a well recognized phenomenon, http://en.wikipedia.org/wiki/Extraordinary_Popular_Delusions_and_the_Madness_of_Crowds However, our elected representatives really should have the foresight and wisdom to see what was happening. Alas, they were corrupted by the amount of money involved in the bubble.

Kersh

Ah ye, since when was 4 walls and a roof, poorly put together, with ppl below, and above and either side worth anything more than 200k. Anywhere.

Like really, did ppl stand on lawns, look at a semi detached houses somewhere and think . . ah ye thats worth 500k! Sure Ill go use 50% or 60% of my take home pay to buy it. . . sure itll be worth 10 million in 2 years. :rolleyes:

Some of the replies are real funny. The stung generation. :pac:

ScumLord

aDeener wrote: »

joejoem's response in particular is quite hilarious.

Cant help but feel there is a lot of wonderful hindsight being floated around though at the moment. no doubt there was people who knew what was coming well in advance but there is certainly an element of being wise after the event now. im not saying you in particular just in general

No, people should have seen it coming, any financial expert worth their salts was saying it was unsustainable from the very beginning.
The houses are of terrible standards, they're simply not worth the money and probably wouldn't pass building regulations in many other countries. They where flung up for a quick buck and the people that bought them stupidly bought into a fantasy, an obvious fantasy.

Stercus Accidit

Lots of egg on face in the first page of posts.

SeaFields

joejoem wrote: »

:rolleyes: suprise suprise. Everyone is an expert when it comes to property. Property is reaching its true value in my opinion. As a small coutry we are majorly affected by supply here, we have a limited amount of land, especially close to the city in Dublin. Prices will climb for another 2 -3 years and then level off with the possibility of a small decline.

Anyone have a link for the double facepalm? :rolleyes::)

Sean Quagmire

SeaFields wrote: »

Anyone have a link for the double facepalm? :rolleyes::)

.

WindSock

Hindsight is a wonderful thing...

This thread reminds me of those stupid films set in the past where they have a person say 'oh they (Rolling Stones) are never gonna make it' As if it is hilarious. Because we ALL know better, eh?

stovelid

WindSock wrote: »

Hindsight is a wonderful thing, eh?

+1

And gloating makes people look small-minded and petty.

And kudos to Dave McWilliams and various clever people who predicted that the boom would end. I mean, booms never ever do that, do they?

Mr Benevolent

stovelid wrote: »

+1

And gloating makes people look small-minded and petty.

Nobody ever called AH a bastion of broad-minded, magnanimous contributors. This is the equivalent of the Joe Duffy show with extra taxi drivers.

brianwalshcork

That's 20/20 hindsight folks. Predicting the future is more difficult. Anyone care to guess the date that the price for the average 3 bed semi D wiill be lowest?

adamski8

Kinetic^ wrote: »

You get nothing at the end of renting for 20 years.

Yeahs how I wish I had €100K+ negative equity and no job to pay my mortgage.
At least now people will stop looking down on/slagging people who rent now!

super_furry

I'd say from mid-2011 for at least a couple of years.

magma69

Goes to show nobody really knows what's around the corner. Predictions in economics don't mean jack. So many scoffed at the idea bubble bursting.

ScumLord

WindSock wrote: »

Hindsight is a wonderful thing...

It's not hindsight, from the very beginning we where warned at home and abroad. It was the most likely outcome, it was guaranteed to happen.

itarumaa

Most sadest thing about this house bubble is that houses are not even well built or good standard, and still you had to pay loads of money of them.

Only to lose about 50% or more of the value couple years later.

Clanket

I've been looking at house prices the last couple of weeks on myhome and am shocked at the prices still being quoted. Granted, if you were to make an offer you would probably get a large dicount. However, in certain areas to be asking for €550k - €600k for a 4 bed house. Madness.

To me a standard house is never ever ever gonna be worth more than €400k. Ever

ScumLord

itarumaa wrote: »

Most sadest thing about this house bubble is that houses are not even well built or good standard, and still you had to pay loads of money of them.

The only plus side I can see to that is that there's plenty of work in fixing them. whether people will have money to fix the problems is another thing.

Most will need to be replaced within our lifetimes at any rate. So they're completely dead money. All those houses waiting around with nobody in them are probably close to unlivable at the moment due to damp ruining the house so they're dead money too.

Meeja Ireland

brianwalshcork wrote: »

That's 20/20 hindsight folks. Predicting the future is more difficult. Anyone care to guess the date that the price for the average 3 bed semi D wiill be lowest?

9th of March 2012. Set your alarm now, and I'll see you in two years.

bazmaiden

Is Miss Fluff George Lee?

Pittens

What's interesting about the first page of this thread is how articulate, and well written, were the arguments in favour of property being fairly valued at the time. There is no text speak, or theres/theirs mixed up, or bad punctuation.

I didn't believe a word of it back then, but plenty of intelligent people did. People, even intelligent people, believe what they want to believe.

K-9

Pittens wrote: »

What's interesting about the first page of this thread is how articulate, and well written, were the arguments in favour of property being fairly valued at the time. There is no text speak, or theres/theirs mixed up, or bad punctuation.

I didn't believe a word of it back then, but plenty of intelligent people did. People, even intelligent people, believe what they want to believe.

People didn't believe it in 98, 00, 02 or early 06 either.

There definitely was an element of being proved right all the time and that fed it as well. Property crashes happen all the time and Governments and plenty of economists never see it coming.

I was late enough seeing it, the last big push on prices in early 06 and the prices Dunne et al were paying sealed it for me.

brianwalshcork

brianwalshcork wrote: »

That's 20/20 hindsight folks. Predicting the future is more difficult. Anyone care to guess the date that the price for the average 3 bed semi D wiill be lowest?

Based on previous housing booms in the UK, 5-7 years from peak, but Ireland is different and so is this crash - it's going to be more equivalent to the US stock market crash of 1929 which took the stock market 25 years or so to reach the same point.

The Eurozone will not tolerate inflation!

House prices will continue to fall for at least another two years, but in parts of the midlands some houses will fall (both prices & structure) indefinately. Decent suburban houses will stop falling in price the first, then if the banks retain strict lending rules will rise in line with inflation & wages.

thetonynator

its not just hindsight, anyone could see that prices could not rise forever, not when incomes were not going up in the same way, it was not possible, in the same way as they will not fall forever they will rise, or that they will never reach a point where they stay perfectly stable.

Overheal

y2k, etc.

Overheal

Overheal wrote: »

y2k, etc.

Y2k, was a nut of unknown size that was cracked with the largest sledgehammer available! The risk was real and eliminated.

How many potential disasters were averted is unknown - there are several trivial issues that occured on systems that did not get Y2k'd, like calendars displaying Jan 1 19100.

As for housing, The warning signs were there, but ignored by the government and their supporters who gained the most from appreciating values.

K-9

Deleted User wrote: »

Based on previous housing booms in the UK, 5-7 years from peak, but Ireland is different and so is this crash - it's going to be more equivalent to the US stock market crash of 1929 which took the stock market 25 years or so to reach the same point.

The Eurozone will not tolerate inflation!

House prices will continue to fall for at least another two years, but in parts of the midlands some houses will fall (both prices & structure) indefinately. Decent suburban houses will stop falling in price the first, then if the banks retain strict lending rules will rise in line with inflation & wages.

Indeed, location, location, location is and will increasingly become more important as time goes on.

I think a lot of people believed the soft landing crap and never expected prices to go back to 05 levels and still dropping. I can see 01/02 levels myself.

It could get even worse than that!

Firetrap

One thing one can draw from this thread is that you should never take advice from an internet thread

It is a fascinating insight into the pre-recession mindset though.

fontanalis

Who else feels confident that the knowledge economy will save the country?

K-9

K-9 wrote: »

Indeed, location, location, location is and will increasingly become more important as time goes on.

I can see 01/02 levels myself.

Only in the best locations though, many areas will fall below construction costs.

fontanalis

fontanalis wrote: »

Who else feels confident that the knowledge economy will save the country?

Only if the knowledge stays here and creates manufacturing/development jobs, right now the best prospects for graduates is at the other end of a long journey.

fontanalis

Deleted User wrote: »

Only if the knowledge stays here and creates manufacturing/development jobs, right now the best prospects for graduates is at the other end of a long journey.

I was referring to the "knowledge" in the first few pages of the post.

fontanalis

fontanalis wrote: »

I was referring to the "knowledge" in the first few pages of the post.

OK

Those that believed in infinate growth based on the recent past and bought property hoping to profit, will now be in serious debt and effectivly "tied" for a good number of years to come.

They would most likely be keeping their heads down!

Pittens

Have most of the pro-property believers banished from this site? I noticed that MorningStar disappeared around 2006 ( which was before the crash but not related). He was adamant that prices were at their correct value.

K-9

Deleted User wrote: »

Only in the best locations though, many areas will fall below construction costs.

Many already have, if you count land as construction costs.

I seen 100k for a 1 bed apartment in the Indo and 150k for a 2 bed just a few weeks ago. This was North Dublin. Must have been a firesale and probably liquidation.

If that site was bought in the last 4/5 years, barely covers land acquisition costs.

K-9

K-9 wrote: »

Many already have, if you count land as construction costs.

There was a time when new houses were always more expensive*, and secondhand houses were price matched to the equivilant new house minus cost of refurbishment.

*but much cheaper than now, 3.5 x average skilled income.

Alessandra

At least in places like Dublin, Cork, Limerick and Galway there is always demand for property to buy or rent.

I'm from the West and each time I go home I am staggered to see estates with 20-30 houses lying empty. People stopped coming to work here and many more people moved back to their own country as it was never their intention to stay so the supply outweighs the demand. Nobody has ever moved into these houses and they are lying empty and probably time will pass by and nobody will ever want to live there no matter how cheap the prices now are.

It's a sad sight to see homes which are near completion lying idle. I imagine they will just rot away with time. It's such a waste of money.

K-9

Alessandra wrote: »

At least in places like Dublin, Cork, Limerick and Galway there is always demand for property to buy or rent.

I'm from the West and each time I go home I am staggered to see estates with 20-30 houses lying empty. People stopped coming to work here and many more people moved back to their own country as it was never their intention to stay so the supply outweighs the demand. Nobody has ever moved into these houses and they are lying empty and probably time will pass by and nobody will ever want to live there no matter how cheap the prices now are.

It's a sad sight to see homes which are near completion lying idle. I imagine they will just rot away with time. It's such a waste of money.

Yep. NAMA will have to decide is it better to knock estates like that and convert them back to agricultural use, which maybe more valuable long term.

K-9

K-9 wrote: »

Yep. NAMA will have to decide is it better to knock estates like that and convert them back to agricultural use, which maybe more valuable long term.

Converting land back to agricultural use as in cultivation aill be quite expensive as the foundations would need to be removed to avoid damaging farm implaments etc.

Pasture or forestry use would be much cheaper, or simple abandonment remove hazardous materials and let nature run it's course.

K-9

Deleted User wrote: »

Converting land back to agricultural use as in cultivation aill be quite expensive as the foundations would need to be removed to avoid damaging farm implaments etc.

Pasture or forestry use would be much cheaper, or simple abandonment remove hazardous materials and let nature run it's course.

Agreed. There are certain areas that mad as it seems, that could well be the best option!


Good point on forestry, never thought of that.

Caoimhín

K-9 wrote: »

Good point on forestry, never thought of that.

Ground cultivation is required for commercial forestry but allowing the sites to return to scrub and eventually forest may be an option.

I reckon salvage and demolition is the business to be in over the next few years.

The Pontiac

K-9 wrote: »

Yep. NAMA will have to decide is it better to knock estates like that and convert them back to agricultural use, which maybe more valuable long term.

Deleted User wrote: »

Converting land back to agricultural use as in cultivation aill be quite expensive as the foundations would need to be removed to avoid damaging farm implaments etc.

Pasture or forestry use would be much cheaper, or simple abandonment remove hazardous materials and let nature run it's course.

K-9 wrote: »

Agreed. There are certain areas that mad as it seems, that could well be the best option!


Good point on forestry, never thought of that.

Caoimhín wrote: »

Ground cultivation is required for commercial forestry but allowing the sites to return to scrub and eventually forest may be an option.

I reckon salvage and demolition is the business to be in over the next few years.

Is this really an option? It sounds mad to me to start knocking down the houses. Take a very small housing estate on one acre, consisting of a few houses valued at a minimum of €100,000 each - it would take literally hundreds of years to yield the same return by means of agriculture or forestry. I know the forestry premiums and grants wouldn't make this financially feasible. And agriculture isn't exactly an industry that's making huge financial returns either, with many farmers struggling to even make a living from it.

Has this happened in other countries? It seems completely bonkers to me..