Imminent pop or not?

miju

homeOwner wrote:

Where? When? I bought my 2 bed apartment in 2003 and have just sold it for a total profit of 200K, thats 66K per year profit and my mortgage payments were 900 per month.

200k clear profit or was that put into another house? if you did make 200k clear profit then fair balls man

Cantab.

homeOwner wrote:

Where? When? I bought my 2 bed apartment in 2003 and have just sold it for a total profit of 200K, thats 66K per year profit and my mortgage payments were 900 per month. To rent in the area is over 1200 pm. Show me the equity that has outperformed that anywhere in the world. I am not the only person who has done this, there are loads of people making that sort of profit from property. Whereas to make 66K from equities you have to be investing literally hundreds of thousands of euro which ordinary Joe Soap doesnt have, hence back to delboy159s point.

Hi, I don't think we're talking about 2003 prices in this discussion. The logic of going out in 2006 and signing up with a bank for 35 years is what the comparison is. There's no doubt that mortgage holders from even 2-3 years ago have done very well. Will this be the case in 2009 do you think? Can the tide turn just as quick? How far back will the crash go? I.e. how likely is it that 2002/2003/2004/2005 buyers will find themselves in negative equity?

I'd say it will be a function of location (commuter towns at higher risk), whether it's an apartment or house (apartments at higher risk) and whether they bought a FTB property or a more mature property (FTB generic slapped-up complexes at higher risk).

FillSpectre

daveirl wrote:

This post has been deleted.

??
How? Are you telling us you could afford a mortgage of that amount or that if you bought the property you rent the mortgage would be an extra 1k?
Some people said this to me before but as they could barely afford the rent I had to point out they saved nothing but you aren't saying that?
Are you actually investing 12k a year?
How much is your combined rent and investment? Is it less than 25% of your income?
Are you still hoping to buy sometime? Do you worry about the stock market crashes?
If people in the UK crash had invested in equities instead of property would they have actually been spared? I remember both effecting each other and wondering how much safer is that really.

homeOwner

SkepticOne wrote:

This would depend on what the house price will be in 20 years time, surely.

Yes as it would also depend on how the stocks you invested in were performing in 20 years time too.

SkepticOne wrote:

Since historically equities outperform property it is follows that money is better off in equities.

That may be a fact on paper, but the reality is someone like me would not have access to the kind of money I had for my mortgage unless it was for a house. Sure the equity markets can give Bill Gates a yield of 66K per year if he invested maybe 500K but to someone like me I could never hope to gain 200K over 3 years investing in equity because I dont have enough capital to invest.

However with a modest deposit on a house I managed to make that much money. And that is my point. IMO you cannot compare the housing market to the global equity market because you are talking about profits generated by wealthy individuals or people who have access to funds that the ordinary person knows very little about.

Sure if I invested 10K in 1990 in microsoft I would be a millionaire now, but in 1990 I had just left school and didnt have 1K let alone 10K and I didnt know what a fund or equity was. I did know what a house was and how to get a mortgage (although I wasnt interested at the time).

You ask most people with 20K saved, name me a fund you want to invest in or a stock you think will go up and they will tell you they dont know. You ask them what area they would like to buy a house in and they will probably have an answer. Who is the smart one? The person investing in bricks and morter that needs ahouse and knows something about what they are investing in, or the person who hands their money over to a fund manager hoping to make alot of money in the future. I have invested in the stock market in my time and made modest amounts of money. I just made 200K on a property I had for 3 years. You tell me that equities historically perform better. I say I'll put my money into my 3 bed semi house and live in it for the next 30 years.

homeOwner

Cantab. wrote:

Hi, I don't think we're talking about 2003 prices in this discussion. The logic of going out in 2006 and signing up with a bank for 35 years is what the comparison is. There's no doubt that mortgage holders from even 2-3 years ago have done very well. Will this be the case in 2009 do you think? Can the tide turn just as quick? How far back will the crash go? I.e. how likely is it that 2002/2003/2004/2005 buyers will find themselves in negative equity?

I'd say it will be a function of location (commuter towns at higher risk), whether it's an apartment or house (apartments at higher risk) and whether they bought a FTB property or a more mature property (FTB generic slapped-up complexes at higher risk).

I agree it will be a function of location and i also think apartemtns will be hardest hit. However I dont think it will be a crash. I think it will continue to rise for another 12-18 months and then increase in line with inflation.

The one main factor I can see in the market turning is when the investors start selling. You can be sure that builders are not going to loose money, they are not going to build an apartment block they dont think they can sell. So until they stop building you can be sure that the market isnt going to nosedive. Its when they stop that I think the slowdown will happen.

All evidence I have seen is that there is still a healthy market out there for family homes in Dublin. Apartments have a price ceiling and I think prices are coming close to that. But thats just my opinion and its not worth anything cause I just dont know whats in store.

whizzbang

homeOwner wrote:

You can be sure that builders are not going to loose money, they are not going to build an apartment block they dont think they can sell. So until they stop building you can be sure that the market isnt going to nosedive. Its when they stop that I think the slowdown will happen.

I heard from an architect that its generally accepted in the building industry that some developers will end up losing money as their developments won't be complete before the market falls. None of them want to call the top too early so they will keep on building. Better for them to build too many and sell them at a discount then build too few and miss out on money.

SkepticOne

homeOwner wrote:

Yes as it would also depend on how the stocks you invested in were performing in 20 years time too.

Yes it would. The statistics are based on averages not individual stocks. You need a diversified portfolio.

That may be a fact on paper, but the reality is someone like me would not have access to the kind of money I had for my mortgage unless it was for a house. Sure the equity markets can give Bill Gates a yield of 66K per year if he invested maybe 500K but to someone like me I could never hope to gain 200K over 3 years investing in equity because I dont have enough capital to invest.

But why would you want to borrow all that money up front to invest? It would not make sense to do it that way. You would only create a massive burden for yourself and still end up with much the same amount of money at the end considering the amount of interest you will be paying over the period.

Put the money you save directly into equities on a regular basis.

daveirl

This post has been deleted.

homeOwner

SkepticOne wrote:

You need a diversified portfolio.

So by your own admission lumping your money soley into the stock market is foolish as that is not diversifying.

SkepticOne wrote:

But why would you want to borrow all that money up front to invest? It would not make sense to do it that way. You would only create a massive burden for yourself and still end up with much the same amount of money at the end considering the amount of interest you will be paying over the period.

Not sure what you mean here, i presume you are talking about a mortgage?
If you can lower the term by upping repayments, you lower the amount of interst you payback and more of your money works for you. In maybe 15 years time you own your own place and for the rest of your life - no rent and you have something to leave your kids if you have them. People who invested in stocks instead of buying as you are suggesting, have to keep paying rent, or cash in and loose 20% CGT, then try to buy somewhere. They are banking on house prices being less than what they made on the stock market. You are competeing with very little money in stocks (1K per month?) against someone who "invested" say 400K mostly of the banks money in a house on very small interst rates. The past 10 years have proven the housing market to be the better bet. Neither you nor I knows what the next 10 years will prove.

SkepticOne wrote:

Put the money you save directly into equities on a regular basis.

You sound as blindingly optimistic as those saying that property can only go up.

If there is a stock market crash tomorrow, just say, and it lasts for 8-10 years (as it has done in the past) until it rebounds close to todays prices then those people who invested their savings are screwed. It doesnt matter to them that the stock market as a whole rebounds if their stocks dont. Some people can't wait 8-10 years to maybe break even. If it keeps going up and there is no crash then happy days. But they have to offset the cost of renting from the profits they make plus CGT when the cash in eventually.

daveirl

This post has been deleted.

ronbyrne2005

The mortgage on my house would cost 4k a month if bought now, the house next door rents for 1400euro, this is in north dublin.also a house costs you money to own in form of insurance maintenence etc which adds a few more grand to the yearly cost of owning a house.

homeOwner

SkepticOne wrote:

Yes it would. The statistics are based on averages not individual stocks. You need a diversified portfolio.But why would you want to borrow all that money up front to invest? It would not make sense to do it that way. You would only create a massive burden for yourself and still end up with much the same amount of money at the end considering the amount of interest you will be paying over the period.

Put the money you save directly into equities on a regular basis.

Ok i think you were talking about borrowing the money to invest in the stock market? That is my point - you wouldnt and you cant borrow it anyway for stock market investing as the bank wouldnt give it to you but you need to invest huge sums to make the sort of money ordinary people have made in property.


You invest 1K for 3 years and make 80 % returns in the stockmarket each year (which is unheard of but I am exaggerating to make a point). Thats roughly speaking 130K at the end of 3 years, which is 36K of your cash plus profit of 94K less say 4K in fees which is very conservative over 3 years. So thats 90K profit.

Summary over three years 80% returns per year in stock market. You investment of 36K yields 90K profit. Well Done!


You invest 20K 3 years ago in a house. Borrow 380K and repay 18K per year interest payments. You sell your house for 600K, making a profit after repaying the bank and estate agent and solicitor 170K, plus you get your 20K back. You were first time buyer so no stamp duty or even take another 20K off for stamp duty...your're still left with 150K on an investment of 20K

Summary over three years 33% returns in property market. Your investment of 20K yields you 170K profit.

Stock market beats property market by a long way, BUT investor who bought the house beats investor who invested in the stock market.

Ordinary people dont have the cash volumns to make stock market pay for them like property does.

homeOwner

daveirl wrote:

This post has been deleted.

I could also say well I am diversifying in the property market, i have an apartment and a house.

That is not diversifying as financial advice goes.

Diversifying means cutting down on your exposure to risk by investing in differnt markets, like property and stockmarket, not picking different flavours within the one market.

If you meant investing in a property fund you are essentially investing in the property market anyway, which the op was saying is a bad move. If you wont invest in your own house why would you invest in a property fund, unless it was foreign and in that case if property is so good in another country why not invest directly?

Afuera

FillSpectre wrote:

Again that is not a denial of the fact you want to buy. I think it was you who said that but I could be wrong either way as you are hesitatnt to actually say you don't ever want to buy by being picky about your words it is obvious you want to own at some point.

Jesus F*in Christ man! Can you not read? I do not want to buy!

I don't have a crystal ball available to see what I might want to do in the coming years or to see the date and time that the market will crash that you're asking for.

FillSpectre wrote:

If you are really interested in a case study of boom to bust you should use an historical event as you can see how it started and ended in it's complete cycle.

I prefer to watch it live.

FillSpectre wrote:

Ireland is actually a really bad example of a boom bust cycle due to the prolonged boom over different sectors over lapping, programs to get imigration populations back into the country, SSIAs etc...

It's still a boom that has broken away from the fundamentals. The correction will be interesting.

Afuera

Jonnie_Onion wrote:

Hey FS, I'd appreciate if you didn't keep ruining threads like this for me by getting personal in your posts, thanks. That kind of thing is the reserve of the less mature poster.

Here, here.

ronbyrne2005

homeOwner wrote:

I could also say well I am diversifying in the property market, i have an apartment and a house.

That is not diversifying as financial advice goes.

Diversifying means cutting down on your exposure to risk by investing in differnt markets, like property and stockmarket, not picking different flavours within the one market.

If you meant investing in a property fund you are essentially investing in the property market anyway, which the op was saying is a bad move. If you wont invest in your own house why would you invest in a property fund, unless it was foreign and in that case if property is so good in another country why not invest directly?

no diversifying in equities means buying different companies, industries, geographical regions etc you can actually diversify a lot with relatively few shares.
A property fund takes away the hassles of managing visiting repairing overseas properties and fund managers usually have better info and contacts in a given location and they can get better prices service etc,plus you can reinvest dividends immediately and invest in them for your pension in a tax efficient manner.

Afuera

homeOwner wrote:

You can be sure that builders are not going to loose money, they are not going to build an apartment block they dont think they can sell. So until they stop building you can be sure that the market isnt going to nosedive. Its when they stop that I think the slowdown will happen.

Buyers can dry up for builders too. In some areas, such as Cork, they are getting buyers to purchase before they are even built to minimize risk. The amount of planning permissions being sought are falling which could be an indication of nervousness by some builders.

homeOwner wrote:

All evidence I have seen is that there is still a healthy market out there for family homes in Dublin.

What evidence have you been looking at to come to this conclusion? It doesn't sound too healthy to me that banks have commented that they have to provide interest only mortgages for family homes in the million euro bracket.

SkepticOne

homeOwner wrote:

Ok i think you were talking about borrowing the money to invest in the stock market? That is my point - you wouldnt and you cant borrow it anyway for stock market investing as the bank wouldnt give it to you but you need to invest huge sums to make the sort of money ordinary people have made in property.

Yes you can't borrow to invest in the stock market. My point was that, unlike housing, you don't need to.

You invest 1K for 3 years and make 80 % returns in the stockmarket each year (which is unheard of but I am exaggerating to make a point). Thats roughly speaking 130K at the end of 3 years, which is 36K of your cash plus profit of 94K less say 4K in fees which is very conservative over 3 years. So thats 90K profit. Summary over three years 80% returns per year in stock market. You investment of 36K yields 90K profit. Well Done!

You invest 20K 3 years ago in a house. Borrow 380K and repay 18K per year interest payments. You sell your house for 600K, making a profit after repaying the bank and estate agent and solicitor 170K, plus you get your 20K back. You were first time buyer so no stamp duty or even take another 20K off for stamp duty...your're still left with 150K on an investment of 20K

Summary over three years 33% returns in property market. Your investment of 20K yields you 170K profit.

Stock market beats property market by a long way, BUT investor who bought the house beats investor who invested in the stock market.

This last sentence is contradictory. If, as you say yourself, over the long run, stocks beat property then, over the long run, the invester in stocks beats the investor in property. Full Stop.

With respect, where you are going wrong is that you are comparing a particular boom phase of the Irish market with long run gains of another market. Obviously not a valid comparison.

Ordinary people dont have the cash volumns to make stock market pay for them like property does.

But the point I made earlier was that it is not necessary to do this to get those gains. If you could get a loan to invest a lump sum in equities at the start obvously you would make more profits on those equities but this gain would be negated by the interest you pay over the period. Plus you are taking on a huge risk early on. There is no point to that comparison either.

Borrowing to invest for the long run is never desirable but with investment in housing you must borrow. To me this is a disadvantage of housing investments (apart from the low yield).

homeOwner

ronbyrne2005 wrote:

no diversifying in equities means buying different companies, industries, geographical regions etc you can actually diversify a lot with relatively few shares.
A property fund takes away the hassles of managing visiting repairing overseas properties and fund managers usually have better info and contacts in a given location and they can get better prices service etc,plus you can reinvest dividends immediately and invest in them for your pension in a tax efficient manner.

we were not talking about diversifying in equities. We we discussing the wisdom of investing in property vs the stock market. A previoius poster made the commeng that you should diversify and then went on to talk exclusively about equities. To me that is not diversifying. That is still putting your eggs in one basket. To diversify in investments you need to invest in different markets.

homeOwner

SkepticOne wrote:

My point was that, unlike housing, you don't need to.This last sentence is contradictory. If, as you say yourself, over the long run, stocks beat property then, over the long run, the invester in stocks beats the investor in property. Full Stop.

Fine. I was talking about short term investment. I'd rather cash out my money in the short term and build on that rather than sit on something that might be worthless in 20 years. A house is never worthless if you plan to live in it. If you were advising someone back 8 years ago you would have been wrong to advise them to invest in equities rather than property. Full Stop.

SkepticOne wrote:

With respect, where you are going wrong is that you are comparing a particular boom phase of the Irish market with long run gains of another market. Obviously not a valid comparison.

No I wasnt. I compared a 3 year gain in both. With investing in the stock market, to make a large profit you have to leave it long term. You dont with property. It was valid comparison to people with real money, their live savings. You are talking about statistics over the long term, i am talking about me and people like me who have made money in property. That it may be an one off "Boom" is irrelevant the fact is it happened and imo will continue to happen the for forseeable short term. There is still money to be made in property.

SkepticOne wrote:

Borrowing to invest for the long run is never desirable but with investment in housing you must borrow. To me this is a disadvantage of housing investments (apart from the low yield).

Again you are talking about long term statistics. That means nothing to me or to the people who made money over the past 8 years. It is not a disadvantage if the market goes up.

SkepticOne

homeOwner wrote:

No I wasnt. I compared a 3 year gain in both. With investing in the stock market, to make a large profit you have to leave it long term. You dont with property. It was valid comparison to people with real money, their live savings. You are talking about statistics over the long term, i am talking about me and people like me who have made money in property. That it may be an one off "Boom" is irrelevant the fact is it happened and imo will continue to happen the for forseeable short term. There is still money to be made in property.

So would you say there's a bubble driven by speculative demand at the moment?

FillSpectre

Afuera wrote:

Jesus F*in Christ man! Can you not read? I do not want to buy!

Yes I can read and you first siad you didn't want to buy in Ireland which still didn't deny you wanted to buy then you said you didn't want to buy now. This is the first time you actually said you you don't want to buy. So as you kept on pointing out that my statemnet wasn't accurate enough you now know how petty it is. It is interesting it took you that long to actually say it.

Afuera wrote:

I don't have a crystal ball available to see what I might want to do in the coming years or to see the date and time that the market will crash that you're asking for.

You know if you want to own your own place or not. You can check the reverese, do you want to rent for the rest of your life?
As you don't have a crystal ball why do you insist it has to crash? How long have you expected a crash

Afuera wrote:

It's still a boom that has broken away from the fundamentals. The correction will be interesting.

Amazing you avioded why you were watching, is it educational study or just plain curiousiity? As you don't live here you aren't really looking at it live. Have you been watching for 10 years? Why choose property or is it the whole economy you are watching?
It seems extrodinary that somebody who has no interst in buying property or live in this country yet you can't stop talking about property here. I think it is people who have nothing to add are ruining threads and those who repeating sayings they don't really understand.
Can you explain the fundementals that have been broken away from because I am curious if we can all agree on what people are saying don't apply and their importance. AS you have been studying the subject you should be able to explain it in your own words.

Afuera

FillSpectre wrote:

You know if you want to own your own place or not.

As I've stated before, I have no desire to own my own place at the moment. I don't even know what country I'd ultimately like to settle in.

FillSpectre wrote:

You can check the reverese, do you want to rent for the rest of your life?

I have no problem renting for the rest of my life. Although I conceed that I'd only be happy to do this provided certain protections are in place for tenants. Ireland does not currently have enough protection for tenants. Germany and many other countries do.

FillSpectre wrote:

As you don't have a crystal ball why do you insist it has to crash? How long have you expected a crash

You're like a parrot the way you repeat your questions.
Since the ECB started moving rates last December I realised that things could tumble fairly easily.

FillSpectre wrote:

Amazing you avioded why you were watching, is it educational study or just plain curiousiity? As you don't live here you aren't really looking at it live. Have you been watching for 10 years? Why choose property or is it the whole economy you are watching?
It seems extrodinary that somebody who has no interst in buying property or live in this country yet you can't stop talking about property here. I think it is people who have nothing to add are ruining threads and those who repeating sayings they don't really understand.
Can you explain the fundementals that have been broken away from because I am curious if we can all agree on what people are saying don't apply and their importance. AS you have been studying the subject you should be able to explain it in your own words.

Your repetition of questions and personal attacks are a little tiresome, FillSpectre. I've stated my position on the subject multiple times and you've tried to throw in a tirade of half-baked counterpoints or off topic remarks. I think you off all posters have added the least the the debate and are ruining the thread.

I don't see any point in going through the same arguments again with you time and time again. I'm only going to state where I stand once more and if you're too dumb to understand the implications of it all then, tough!



First, the facts. You can get the exact figures from the central statistics office or the various reports released from construction industry, real estate agents, banks etc.

- increase in supply is far exceeding population growth
(compare the amount of newly built houses to the population growth rate)

- bounds of affordability being reached
(evident with introduction of 100% mortgages, longer terms, increasing amount of IO mortgages)

- high investor involvement
(40% figure supplied by Sherry Fitzgerald)

- over reliance on construction in economy
(14% of employment directly in the industry, over 20% of government's tax take according to CIF)


Unfortunately all of these things together don't look too promising. You can draw your own conclusions but here's how I see things standing...

It's obvious that supply will have to be dramatically slowed down at some stage in the future. There is talk of another 100,000 new houses appearing this year so in the short term, it's not reducing dramatically. In the longer term there have been slightly less planning applications which could be a signal that some developers are getting skittish. Due to investor involvment it's very easy for demand to buy to overshoot demand for properties to actually live in (if we haven't already reached this stage).

Affordabilty is getting stretched even further by rising interest rates. This is the current course of action by the ECB to combat inflation and seems set to continue. Less affordabilty will mean less demand at current prices.

High investor involvement introduces instability to the market which can make it difficult to weather a slowdown or a slump. If all of the market was made up of owner-occupiers then this would not be the case. You can not expect investors to sit tight while their money could be earning a better return with less risk elsewhere.

As things stand, a general slowdown in construction will extend to a general slowdown of the economy. This would be the killer as once there is a slide in construction not only would it increase unemployment but it would also reduce the governments tax take. These things could further reduce demand for construction, employment, goods in general etc and the negative sprial would continue.



The popular conjecture being put forward at the moment is for a soft landing.
IMHO I don't think the facts support this. A soft landing is only possible if demand and supply can be reigned in at the same time. We don't really have much contol on the demand side since it is heavily dependant on interest rates set by the ECB. Also, what's worse is they seem intent on a rapid movements of rates to counteract inflation (which is after all of primary concern to them). The government and builders could reduce supply but this can't be done very quickly due to the time taken for planning permissions, completion of building etc. Also builders deciding to forego possible profit to insure a stable market sounds a little far fetched to be honest.



You seem to be of the opinion that it takes a big event to cause a crash. I disagree with this and think that changing sentiment alone could cause a correction. Investors feeling that it's too risky and future buyers feeling that rising rates will stretch their ability to pay mortgages can be very damaging. The problem with the realization that sentiment is so important to the market is that it becomes very difficult to call when something will actually happen. Just because economists calling time on something they didn't perceive as sustainable weren't correct in the past does not mean that they are fundamentally wrong.

Julesie

homeOwner wrote:

we were not talking about diversifying in equities. We we discussing the wisdom of investing in property vs the stock market. A previoius poster made the commeng that you should diversify and then went on to talk exclusively about equities. To me that is not diversifying. That is still putting your eggs in one basket. To diversify in investments you need to invest in different markets.

Please research the meaning of diversification of risk before you pontificate on something you obviously have no idea about. The other posters are right, it is far easier to diversify your risk using stocks and shares rather than property if capital is constrained. If you wanted a well diversified portfolio of property then it would mean having different types of property (residential, commercial, industrial) in different locations (and i don't mean around ireland or even confined to europe). Obviously such a portfolio would be incredibly expensive to establish and is beyond the reach of us mere mortals. A proxy for such a portfolio would be investing in a property fund which would take care of the diversification aspect for you. Daveirl could just as easily invest in property this way using his monthly surplus and he would have a much safer investment in the longer term than your house and apartment.

Cantab.

Julesie wrote:

Please research the meaning of diversification of risk before you pontificate on something you obviously have no idea about.

Last time I checked, this was a public forum where one is free to give an opinion. Since when do you need an MBA from the London School of Economics to give a personal opinion on boards.ie?

Julesie wrote:

The other posters are right, it is far easier to diversify your risk using stocks and shares rather than property if capital is constrained. If you wanted a well diversified portfolio of property then it would mean having different types of property (residential, commercial, industrial) in different locations (and i don't mean around ireland or even confined to europe). Obviously such a portfolio would be incredibly expensive to establish and is beyond the reach of us mere mortals. A proxy for such a portfolio would be investing in a property fund which would take care of the diversification aspect for you. Daveirl could just as easily invest in property this way using his monthly surplus and he would have a much safer investment in the longer term than your house and apartment.

I agree with much of this.

The dogs on the street will tell you that buying Irish property as an investment gives terrible you a P/E at huge risk. Even bloody Rabodirect offers better returns at no risk whatsoever.

I think the chaps on here opting to rent and invest in equities are very sensible given the current property situation.

I like the 'dead cat bounce' theory on Wikipedia! Also look at 'real estate property bubble' for some informed reading.

Julesie

Cantab. wrote:

Last time I checked, this was a public forum where one is free to give an opinion. Since when do you need an MBA from the London School of Economics to give a personal opinion on boards.ie?

Apologies that was a bit of a rash comment, i was just getting increasingly frustrated at erroneous statements being reported as facts.

asdfz

I've just bought a duplex beyond Dublin airport. Would it be wise to sell now? I was thinking of having it as an investment property while I'm away working in London next January.

Cantab.

asdfz wrote:

I've just bought a duplex beyond Dublin airport. Would it be wise to sell now? I was thinking of having it as an investment property while I'm away working in London next January.

I'd like to say you'll be ok, but honestly, I just can't for the life of me.

I found this thread over on the politics board: http://www.boards.ie/vbulletin/showthread.php?t=2054963155
"Manufacturing Employment Falling Steadily in Ireland".

I just don't know where the economy will be in the short to medium term. The forthcoming election worries me a lot.

miju

asdfz wrote:

I've just bought a duplex beyond Dublin airport. Would it be wise to sell now? I was thinking of having it as an investment property while I'm away working in London next January.

the best answer anyone here can give you would be to seek independant financial advice OR google irish property market and read the many reports / threads about peoples opinions on the irish property market / economy come to your own conclusions about whether or not to sell

homeOwner

Julesie wrote:

Please research the meaning of diversification of risk before you pontificate on something you obviously have no idea about. The other posters are right, it is far easier to diversify your risk using stocks and shares rather than property if capital is constrained. If you wanted a well diversified portfolio of property then it would mean having different types of property (residential, commercial, industrial) in different locations (and i don't mean around ireland or even confined to europe). Obviously such a portfolio would be incredibly expensive to establish and is beyond the reach of us mere mortals. A proxy for such a portfolio would be investing in a property fund which would take care of the diversification aspect for you. Daveirl could just as easily invest in property this way using his monthly surplus and he would have a much safer investment in the longer term than your house and apartment.

Did you even read the posts before replying. You are stating (as fact) that diversifying within the stock market is spreading your risk.


This would be divesifying your investments:
1. Put some money into stock market (funds, etc...)
2. Put some money into your pension.
3. Put some money into property
4. Put some money into a long-term savings account


You are talking exclusively about investing within the stock market and therefore exposing all your money to the same risk i.e. a stock market downturn which is open to the whim of international politics eg a war, a terrorist attack in the US etc..... yes it is diversifying but only WITHIN the stockmarket. That is NOT a diversified investment portfolio and I would never consider investing exclusively in the stock market, and if you are suggseting that it is a good idea to do so, then you would be sorely mistaken.

and I dont need a degree in economics to work that one out.

I never suggested diversifying in property by buying in differnet countries was a good idea.