Housing Bubble Bursting

jmayo

Deleted User wrote: »

Ah yes! Lot 112 in Llanfairpwllgwyngyllgogerychwyrndrobwllllantysiliogogogoch I know it well!

The most hated man is the one that shouts "give me a L" at football matches.

Funny though how prices in one of our neighbours remained low whilst ours flew through the stratosphere.

jmayo

jmayo wrote: »

The most hated man is the one that shouts "give me a L" at football matches.

Funny though how prices in one of our neighbours remained low whilst ours flew through the stratosphere.

Maggie Thatcher "helped" by killing most of the industry in that area, some parts of North Wales became an industrial wasteland, large numbers of abandoned houses and no chance of selling.

mari2222

Deleted User wrote: »

Maggie Thatcher "helped" by killing most of the industry in that area, some parts of North Wales became an industrial wasteland, large numbers of abandoned houses and no chance of selling.

Now where does that remind me of?

TKline

Caoimhín wrote: »

Before you even consider buying a house in this fair land, have a good read through this website; www.thepropertypin.com

I had my own suspicions about the Irish property market when I came home from Manchester in 2001, I thought it odd that the price of an average house in Tullamore was twice the price of a similar building in Manchester, (Manchester having roughly the same population of all of Ireland).

Reading the Property pin finally convinced me that it was just a speculative asset bubble. Its funny how the politicians and media are spinning the line that "nobody saw it coming" and "sure we were all at it". Some people did see it coming but were told to commit suicide, just for pointing out that the Emperor had no clothes.

I reckon that website saved me from a life of negative equity and subservience to the bank.

Spot on, property websites have saved a huge number of people from property bubbles in Ireland and abroad. You've got housepricecrash.co.uk for the British, GHPC for the global bubble, AustralianPropertyForum.com for the Aussies, propertypin for the Irish bubble etc. Property fora have been great for educating the masses.

Here in Australia house prices have started to collapse rapidly as the RBA is lifting rates because of overheating in the mining sector. This is destroying the rest of the economy and ravaging the housing market.

The Aussie housing bubble is on its last legs, with Steve Keen recently revealing that the Australian Property Bubble is already bursting. The biggest force driving prices up was excessive irrational exuberance, and now that's turned into excessive pessimism and bearishness, capitulating the housing market in Australia!

Australia has had one of the worlds worst real estate bubbles and its good to see it finally collapsing.

Deleted User

Deleted User wrote: »

Maggie Thatcher "helped" by killing most of the industry in that area, some parts of North Wales became an industrial wasteland, large numbers of abandoned houses and no chance of selling.

The mining industry there was subsidised - rubbish that they couldnt afford to prop up anymore, the UK was broke at the time, our 20 billion a year deficit is alot of "extra" money in the economy which is effectively propping up businesses that will fail when the cut backs continue.

Property prices have a long way to come down yet

Deleted User

Deleted User wrote: »

The mining industry there was subsidised - rubbish that they couldnt afford to prop up anymore, the UK was broke at the time, our 20 billion a year deficit is alot of "extra" money in the economy which is effectively propping up businesses that will fail when the cut backs continue.

Property prices have a long way to come down yet

Can't argue with that! UK manufacturing industry had been lagging behind the far east since the 1950's.

The problem with the coal mining industry was simply the fact that the "cheap -n- easy" stuff had largely been mined out!

ronan45

Thank god that reccession is over!! House prices in Dublin on the way up again HURAAAAAA
Time to get the property ladder dusted off again


22/06/2011 - 11:12:36
Residential property prices have declined by 1.2% in the last month, compared to a decline of 1% in April, it was revealed today.

Official figures released by the Central Statistics Office showed that prices have fallen by 12.2% in the last 12 months.

The price of residential property in Dublin bucked the trend however, increasing by 0.4% in May, but still 11.5% lower than a year ago.

The CSO report warned however that "care should be taken when interpreting individual monthly figures which may indicate short-term volatility rather than underlying change in longer-term price trends."

Dublin house prices increased by 0.3% in the month and were 10.9% lower compared to a year earlier.

Dublin apartment prices fell by 0.3% in the month of May and were 14.8% lower when compared with the same month of 2010.

The price of residential properties in the rest of Ireland fell by 2.1% in May compared with a decline of 1.2% in the same month of last year.

Prices were 12.5% lower than in May 2010.

House Prices in Dublin are almost 46% lower than at their highest level in early 2007. Apartments in Dublin are 53% lower than they were in February 2007.

The fall in the price of residential properties in the Rest of Ireland is somewhat lower at
38%. Overall, the national index is 41% lower than its highest level in 2007.

Read more: http://www.breakingnews.ie/ireland/rate-of-house-price-decline-increases-509935.html#ixzz1Q0FADCC3http://www.breakingnews.ie/ireland/rate-of-house-price-decline-increases-509935.html

highgiant1985

apologies here but is that based on asking or selling price?

oceanclub

We hit that bottom a long time back. It's just a very slopey bottom.

P.

catbear

oceanclub wrote: »

We hit that bottom a long time back. It's just a very slopey bottom.

P.

Is it probable that the property is passing through the bottom, in other words it really is down the sh.............er

ronan45

highgiant1985 wrote: »

apologies here but is that based on asking or selling price?

Giant... i can assure you its 100% based entirely on wishful thinking

I'm not surprised by the fact that Dublin (asking) prices have stopped dropping, it appears that the trend of setting up home in commuter towns and working in the "city" has finally come to an end, mainly due to high fuel prices.

Decent housing in the city will drop to the point where banks believe they won't end up with negative equity if the mortgagees default, that point must be close at this stage.

Remote rural housing may in some cases be unmortgageable.

Godge

Deleted User wrote: »

I'm not surprised by the fact that Dublin (asking) prices have stopped dropping, it appears that the trend of setting up home in commuter towns and working in the "city" has finally come to an end, mainly due to high fuel prices.

Decent housing in the city will drop to the point where banks believe they won't end up with negative equity if the mortgagees default, that point must be close at this stage.

Remote rural housing may in some cases be unmortgageable.

Agree that Dublin prices were always going to be the ones that stopped dropping first. Agree also that remote rural housing will sell below cost for at least the next 10-15 years.

However, I think that at best prices in Dublin will bump along the bottom for the next five years or so. The market is still vulnerable to further external shocks - even if Greece can be rescued, it may force up Euro interest rates beyond where they were going anyway - and may yet have to price in the interest rate increases that are on the way.

colc1

ronan45 wrote: »

Thank god that reccession is over!! House prices in Dublin on the way up again HURAAAAAA
Time to get the property ladder dusted off again
[/URL]

Good one! Sarcasm all the way! I'd reckon they'll drop another 50% anyway in Dublin God knows how far they'll fall in Dublin only a major gambler would pay anything close to asking price these days and waste all that cash.... Like that girl who wrote the article in the Independent and got stung thinking she was getting a good deal by paying less than others in the area begore her... Her bad decision-making was pretty shocking for a financial journalist... :rolleyes:

Spiritofthekop

colc1 wrote: »

Good one! Sarcasm all the way! I'd reckon they'll drop another 50% anyway in Dublin God knows how far they'll fall in Dublin only a major gambler would pay anything close to asking price these days and waste all that cash.... Like that girl who wrote the article in the Independent and got stung thinking she was getting a good deal by paying less than others in the area begore her... Her bad decision-making was pretty shocking for a financial journalist... :rolleyes:

House prices in Dublin will keep falling & falling for the next 5 years.

Don't believe any other nonsense you read about the receission is over & house prices are rising.

niallers1

Yep, they'll keep falling until they get to a point where you can buy one for 90 cents or maybe swap for a twix..:rolleyes:

Treehouse72

niallers1 wrote: »

Yep, they'll keep falling until they get to a point where you can buy one for 90 cents or maybe swap for a twix..:rolleyes:

You are being facetious, but the really funny thing is that if you went to the bank looking to borrow that 90c and another 80c for the Twix they'd probably turn you down.

Mortgages issued are down an (almost) unbelievable 93% since 2006:

http://www.irishtimes.com/newspaper/property/2011/0623/1224299448538.html

Just think about that for a moment. 93% of the money that was there for buying gaffs in 2006 is, quite simply, no longer there. With no chance that situation will change.

So tell me, that €200,000 house in 2006...how can that cost even half that amount now? A quarter? Indeed, why isn't it worth 7% of its 2006 price? Offering a Twix for it might be overpaying.

Zamboni

Treehouse72 wrote: »

You are being facetious, but the really funny thing is that if you went to the bank looking to borrow that 90c and another 80c for the Twix they'd probably turn you down.

Mortgages issued are down an (almost) unbelievable 93% since 2006:

http://www.irishtimes.com/newspaper/property/2011/0623/1224299448538.html

Hold out folks.
KBC have their fingers crossed...

niallers1

Treehouse72 wrote: »

So tell me, that €200,000 house in 2006...how can that cost even half that amount now? A quarter? Indeed, why isn't it worth 7% of its 2006 price? Offering a Twix for it might be overpaying.

How much do you think a house should cost ?

Taking into account Land, labour, materials, professional fees, the cost of money?
In your opinion should all areas cost the same?

Supply and demand will determine the house price. Not wishful thinking that it will be low enough so you can buy any house you choose with your pocket money.

Maybe you could buy a Treehouse, Treehouse

djmcr

niallers1 wrote: »

How much do you think a house should cost ?

Taking into account Land, labour, materials, professional fees, the cost of money?
In your opinion should all areas cost the same?

Supply and demand will determine the house price.

Supply and demand will determine house prices but demand is dependent on buyers getting mortgages which Treehouse has pointed out is down 93% on 2006 figures. Until the banks are operating normally and people can get mortgages there is only one way for house prices. It would be intersting to know on haw many sales the CSO are basing their figures

jmayo

Godge wrote: »

Agree that Dublin prices were always going to be the ones that stopped dropping first. Agree also that remote rural housing will sell below cost for at least the next 10-15 years.

And do you seriously think they have stopped decreasing ?
What has cost of build got to do with it ?

Godge wrote: »

However, I think that at best prices in Dublin will bump along the bottom for the next five years or so.

So we have reached the bottom in Dublin?

niallers1 wrote: »

How much do you think a house should cost ?

Taking into account Land, labour, materials, professional fees, the cost of money?

What have they got to do with it at the moment ?
A house is only worth as much as someone can afford to pay for it and are willing to pay for it.

Because all of those had high costs over last 10 odd years doesn't mean someone now selling can factor them in.

I know people who bought sites, did the building at height of boom so very expensive labour & professional fees and the price the subsequent completed houses could reach today would not come close to covering the costs.

As for the cost of money that is only going one way and we will never be back to the lunacy of 100% mortgages, interest only mortgages, mortgages for 2 or 3 %.

niallers1 wrote: »

In your opinion should all areas cost the same?

True location always has a bearing, but don't think that any area will be totally immune from dropping prices.

niallers1 wrote: »

Supply and demand will determine the house price.

And how is that equation at the moment ?

niallers1

I think the only people that will sell in this climate are distressed sellers or property owners who are highly motivated to sell.


Do we really have that many people who are willing to crystalise their losses.. Right now the loss for them is a paper loss.. As soon as you sell your property below what you owe then you are making the loss "real".

I think people will hang in there until prices return ...whether they will return or not has to be seen, but as long as people are paying their mortgage and believe that things will get better you will not see the mass firesale that some people are expecting and hoping for..

Spiritofthekop

niallers1 wrote: »

I think the only people that will sell in this climate are distressed sellers or property owners who are highly motivated to sell.


Do we really have that many people who are willing to crystalise their losses.. Right now the loss for them is a paper loss.. As soon as you sell your property below what you owe then you are making the loss "real".

I think people will hang in there until prices return ...whether they will return or not has to be seen, but as long as people are paying their mortgage and believe that things will get better you will not see the mass firesale that some people are expecting and hoping for..

IMO house prices will never reach what they were in 2006 again in my lifetime.

To make the same mistake again would be comical as a country.

niallers1

The only way we will see the massive firesale is if interest rates start hitting double digits..

I can't see house prices ever increasing to the same levels either but that's not to say they won't stablise at a higher level from todays prices when the depression is over...

Treehouse72

niallers1 wrote: »

as long as people are paying their mortgage and believe that things will get better you will not see the mass firesale that some people are expecting and hoping for..

I hate to break it to you...

niallers1

Treehouse72 wrote: »

I hate to break it to you...

A mortgage is over 30 years approx: People will probably see 3 recessions in this span of time.. Things are good , things are bad, things are good , things are bad.

Things are bad now..It's just a part of the economic cycle.

2 years time things will be better than they are now..People are not losing their jobs at the same rate..I am personally hearing of more and more poeple securing employment ..if this continues then things will definetly get better as people start spending again..

http://www.jobsnews.ie/

It's not a crime to feel positive about our future..

ionapaul

I'm relatively positive about the medium-to-long term future in Ireland - lower property prices are part of my positive feelings though, lower prices are actually good for the country in the long term. We'll obviously never see real prices at the same levels of 2005-2008 ever again, it would literally be criminal of our government to allow another obscene asset price bubble to blow up again.

fontanalis

niallers1 wrote: »

A mortgage is over 30 years approx: People will probably see 3 recessions in this span of time.. Things are good , things are bad, things are good , things are bad.

Things are bad now..It's just a part of the economic cycle.

2 years time things will be better than they are now..People are not losing their jobs at the same rate..I am personally hearing of more and more poeple securing employment ..if this continues then things will definetly get better as people start spending again..

http://www.jobsnews.ie/

It's not a crime to feel positive about our future..

Property prices should follow the economy not the other way around; why are property prices still seen as the be all and end all.

niallers1

niallers1 wrote: »

A mortgage is over 30 years approx: People will probably see 3 recessions in this span of time.. Things are good , things are bad, things are good , things are bad.

Things are bad now..It's just a part of the economic cycle.

2 years time things will be better than they are now..People are not losing their jobs at the same rate..I am personally hearing of more and more poeple securing employment ..if this continues then things will definetly get better as people start spending again..

http://www.jobsnews.ie/

It's not a crime to feel positive about our future..

You do realise that the rules have changed now, the previous economic cycle was based on cheap and plentiful fuel and cheap labour elsewhere.

Fuel is no longer cheap and labour costs are rising in the east as they fall here in the west.

You need to rewrite the rulebook.

oceanclub

niallers1 wrote: »

2 years time things will be better than they are now..People are not losing their jobs at the same rate..I am personally hearing of more and more poeple securing employment ..if this continues then things will definetly get better as people start spending again..

http://www.jobsnews.ie/

That's a website by a recruiter. Getting your news about jobs from there is like getting your news about the property market from an estate agent.

P.