Housing Bubble Bursting

ShadowHearth

You missed the point guys. I mean decent property which is not in ghost estate not in the middle of devils arse, not with falling roof.

Let's say a house in which you can live in decent area and not fancy?

I know that houses in ghost estates will soon go for pennies, but that's everywhere in the world. I am just wondering where could be the golden spot for avarege Joe.

Yahew

ShadowHearth wrote: »

You missed the point guys. I mean decent property which is not in ghost estate not in the middle of devils arse, not with falling roof.

Let's say a house in which you can live in decent area and not fancy?

I know that houses in ghost estates will soon go for pennies, but that's everywhere in the world. I am just wondering where could be the golden spot for avarege Joe.

Well if you can't get a mortgage for 80k or less... Houses in cabra used to cost 300k. It's an alright suburb.

robd

ShadowHearth wrote: »

You missed the point guys. I mean decent property which is not in ghost estate not in the middle of devils arse, not with falling roof.

Let's say a house in which you can live in decent area and not fancy?

I know that houses in ghost estates will soon go for pennies, but that's everywhere in the world. I am just wondering where could be the golden spot for avarege Joe.

On North Side of Dublin, places like Finglas and Mulhudert already have houses for below 100k. Not the best locations but Donneycarney which isn't bad and close to town and not far from Dart (depending on end) has houses in need of refurb for 149k. Needs updated windows and insulation and decor. Roofs fine though.

If Morgan Kelly's latest is to be believed there's room for 50% drop on most reasonable current asking prices too.

Longer term I see:
1 bed apt in Dublin @ avg 99k,
2 bed apt in Dublin @ avg 150k
3 bed hse in Dublin @ avg 200k
4 bed hse in Dublin @ avg 300k

You'll pay for better location, size and condition.

Yahew

Yahew wrote: »

Well if you can't get a mortgage for 80k or less... Houses in cabra used to cost 300k. It's an alright suburb.

What if the banks were "persuaded" to lower their minimum mortgage limits to, say 2x annual income of the buyer?

Would it not free up the bottom end of the housing market!

jmayo

ShadowHearth wrote: »

Just a quick one so lads. Is there still room for property to go down? Surely normal house in normal non ghost estate cam go lower them 100k?

Someone (a bull I believe) a while back around here was claiming house prices could not drop below build costs. :rolleyes:

Deleted User wrote: »

What if the banks were "persuaded" to lower their minimum mortgage limits to, say 2x annual income of the buyer?

Would it not free up the bottom end of the housing market!

Great why not get them giving out 100% mortgages while you are at it.
:rolleyes:

The way to free up the market is to let it burst, so that a floor is reached and people then know true value.

As it is we have been artifically keeping a floor on it through NAMA, banks not repossessing homes, sorts of mortgage amnesties, high rent allowances allowing insolvent broke landlords continue, etc, etc.

oceanclub

People have been asking for the past three years can house prices go any lower. Well, read a newspaper, and you'll see that the world economy is tanking, the US has lost its AAA credit rating for the first time, European bank shares are plummeting, the chance of the euro actually being dissolved is fairly high, and Italians are having to be prevented from fleeing to Switzerland with their capital, and the decrease in house prices has actually _accelerated_ in the last quarter.

So could the price of houses on a fairly insignificant island that relies of these large neighbours go down? Well, what do you think?

P.

Spiritofthekop

oceanclub wrote: »

People have been asking for the past three years can house prices go any lower. Well, read a newspaper, and you'll see that the world economy is tanking, the US has lost its AAA credit rating for the first time, European bank shares are plummeting, the chance of the euro actually being dissolved is fairly high, and Italians are having to be prevented from fleeing to Switzerland with their capital, and the decrease in house prices has actually _accelerated_ in the last quarter.

So could the price of houses on a fairly insignificant island that relies of these large neighbours go down? Well, what do you think?

P.

lol...nicely said.

jmayo

jmayo wrote: »

Great why not get them giving out 100% mortgages while you are at it.
:rolleyes:

You obvously didn't understand why I said that! :rolleyes:
Banks won't give you a mortgage is the house costs less than €100k

We need smaller mortgages for cheaper houses!

jmayo

Deleted User wrote: »

You obvously didn't understand why I said that! :rolleyes:
Banks won't give you a mortgage is the house costs less than €100k

We need smaller mortgages for cheaper houses!

Sorry did not understand that was what you meant.
I had always thought you a bit of a bear btw, so was surprised myself at what I thought you meant in your post.

The_Conductor

Zamboni wrote: »

Democracy always seems like a great idea until the realisation that the majority of the populace are morons kicks in.

You have no idea how much I love this post.........:D

Anyhow back on track again-

Morgan Kelly is now suggesting that Irish property prices could potentially fall to half their ***current*** levels......... He is also stating that an Irish default on our debt is inevitable.........

Given the genesis of this particular thread over 5 years ago- I'm inclined to listen to him- despite the rebuttals of other economists.........

dory

smccarrick wrote: »

Morgan Kelly is now suggesting that Irish property prices could potentially fall to half their ***current*** levels......... He is also stating that an Irish default on our debt is inevitable.........

Given the genesis of this particular thread over 5 years ago- I'm inclined to listen to him- despite the rebuttals of other economists.........

I agree with him too having lived in many countries and seen how much of their income they spend on property. Why should Ireland be so different?

PhoenixParker

jobeenfitz wrote: »

does anybody know why rent is not dropping anything like house prices. I was paying 600 rent in county Galway a couple of years ago and still paying 600 for same place. Will rent come down?

Among other reasons, rent never went up like house prices did.
Look at the Daft rental report and you can see the pattern.

When it starts in about 2001 rents were at say 100.
They then fell for a 2/3 years.
Then they rose for 2/3 years and in 2006/2007 they were right back where they started.
Then they fell by about 25% where they have sat for the last year.

The 25% fall in rents brought us back to late 90s levels.
In house prices the 25% fall brought us back to about 2004.

Bobeagleburger

Almost 15% drop in house prices the last 12 months. Highest global drop...

Ireland had the worst average house price decline among all reporting countries in the Global Property Guide survey over the 12 months to Q2, 2011.

House prices were down by 14.84% year-on-year, an even worse decline than the 11.83% fall the previous year.

The only European countries which experienced weaker performances than the previous year include Netherlands (-4.07%), Slovak Republic (-6.49%), Croatia (-6.55%), Spain (-8.43%) and Athens, Greece (-9.88%) (all figures inflation-adjusted).

In the UK, average house prices were down by 5.33% year-on-year, after rising 6.04% the previous year.

The housing market began rebounding as early as Q4 2009, but started falling again in the last quarter of 2010.

Norway led the small group of European countries which experienced house price increases, up by 5.93% over the year to end Q2, 2011.

Norway’s housing market began to rebound in Q3 2009 and has not slowed, driven by low interest rates and strong economic growth (4.8% more than a year earlier).

Housing markets in Estonia (Tallinn), France and Iceland rose during the year to end Q2, 2011 after suffering house price falls in the previous year.

In Tallinn, house prices were up 4.94% year-on-year, after last year’s fall of 0.66%. In France (data is from FNAIM), prices of existing dwellings rose 4.65% year-on-year, after a fall of 1.71% the previous year.

In Iceland, house prices rose slightly by 0.60% year-on-year, after plunging by 9.04% during the previous year.

US house prices fell 9.05% after inflation (a 5.93% decline in nominal terms) in the second quarter from a year earlier, the largest decline since 2009, according to the Federal Finance Housing Agency (FHFA). During the quarter, house prices dropped 2.33% after inflation (a fall of 0.63% in nominal terms).

“House prices are still over-stretched in many countries, and developed world economies are still weak, so price-falls were to be expected,” said Matthew Montagu-Pollock, publisher of the Global Property Guide.

“Low interest rates will be positive for housing, but only if the underlying economies recover.

“And recovery will ultimately bring a sting in the tail, because higher inflation would eventually bring higher nominal interest rates, choking strong upward house price movements.” Read more: http://www.breakingnews.ie/ireland/i...#ixzz1W89Nqicy

Jesus Wept

'worst' 'worse' 'weaker'. 'recovery will bring'.

This is the recovery. Sick of these biased *****.

Jesus Wept

'worst' 'worse' 'weaker'. 'recovery will bring'.

This is the recovery. Sick of these biased *****.

Supercell

Went to see a house today. Asking was 249, prevous offer was 235, agent told me today that someone bidded 250 this morning on the first viewing!! What kind of person up's the bid by so much?, even over the asking in the current market!!, I just was astounded. Good luck to them I suppose, I wasnt going to bid much more than the previous offer anyhow, the agent mustn't believe his luck.

Caoimhín

Supercell wrote: »

What kind of person up's the bid by so much?, even over the asking in the current market!!, .

In my extensive experience of estate agents, this "Person" most likely does not exist.

Mr P Hampton is still looking!

yawnstretch

Where are all these affordable houses? Don't feel like rooting through 400 pages of this thread... I'm in Galway by the way.

And aren't the good mortgages for first time buyers gone now anyway?

/not convinced

Supercell

Caoimhín wrote: »

In my extensive experience of estate agents, this "Person" most likely does not exist.

Deleted User wrote: »

Mr P Hampton is still looking!

Bit of a dodgy tactic it it is, I was prepared to up to 245 (in small increments) but instead this resulted in no bid at all from me.

Dades

Supercell wrote: »

Bit of a dodgy tactic it it is, I was prepared to up to 245 (in small increments) but instead this resulted in no bid at all from me.

You should make a lower bid anyway - tell the agent it's in case the "existing" bid doesn't materialize.

You have nothing to lose, and you might well call their bluff.

Zamboni

New figures confirm that the percentage of mortgages which are behind on their repayments rose to 7.2% in the second quarter of this year.

The Central Bank said 55,763 mortgage accounts were in arrears for more than 90 days at the end of June, up more than 6,000 compared with the previous three months. The percentage figure is up from 6.3% in the previous report.

The number of restructured mortgages rose from 62,936 at the end of March to 69,837. The Central Bank says arrangements involving the repayment of at least the interest only part of the mortgage make up just over half of all restructured mortgages.

Today's Central Bank figures also show that another 172 homes were repossessed in the second quarter of this year, up from 140 in the first quarter. 56 repossessed homes were sold in the three-month period.

http://www.rte.ie/news/2011/0829/mortgage-business.html

This repossession moratorium is scandalous.
It's time to cut the chord on this and let the market function correctly.
There is no human cost here, only pride.
There is plenty of housing available for the dispossessed.
In the long run Morgan Kelly may actually be conservative when he says residential property will fall to half of its current value.

Zamboni

Zamboni wrote: »

http://www.rte.ie/news/2011/0829/mortgage-business.html

This repossession moratorium is scandalous.
It's time to cut the chord on this and let the market function correctly.
There is no human cost here, only pride.
There is plenty of housing available for the dispossessed.
In the long run Morgan Kelly may actually be conservative when he says residential property will fall to half of its current value.

I believe that a significant number of these are BTL anyway.

Zamboni

Deleted User wrote: »

I believe that a significant number of these are BTL anyway.

Aye, which is even worse.

highgiant1985

Deleted User wrote: »

I believe that a significant number of these are BTL anyway.

sorry what does BTL mean?

subway

BTL = buy to let
investment properties, ie, if repossessed the "family home" is not at risk.
someone took a gamble and lost, the same as if they invested in shares or horses. the govt doesnt need to protect investors but many BTL investors are hiding behind protections for private homeowners facing eviction

subway

Deleted User wrote: »

I believe that a significant number of these are BTL anyway.

i feel the same, but is there anything to back this belief up?

subway

subway wrote: »

i feel the same, but is there anything to back this belief up?

There are threads on thepropertypin.com with the estimates, will look them up later.

ronan45

House and apartment prices fell by 0.8% last month and are down 12.5% in the year to July, according to latest figures from the Central Statistics Office (CSO)

http://www.breakingnews.ie/ireland/house-prices-down-by-125-in-year-to-july-518351.html

Residential property prices in Dublin are now almost 49% lower than at their highest level in February 2007

Read more: http://www.breakingnews.ie/ireland/house-prices-down-by-125-in-year-to-july-518351.html#ixzz1WQ6toMEI

So in general house prices in Dublin are down 49%. Ok thats grand but has a 4 bed semi D in a mature nice housing estate dropped at the same rate as a badly made 2 bed apartment in a dodgy part of Dublin? Surely Apartments prices are down more then 50%?

robd

ronan45 wrote: »

So in general house prices in Dublin are down 49%. Ok thats grand but has a 4 bed semi D in a mature nice housing estate dropped at the same rate as a badly made 2 bed apartment in a dodgy part of Dublin? Surely Apartments prices are down more then 50%?

Not a chance decent 4 bed semis are down anything like 50%. More like 30%. The reality is these figures are completely made up based on estate agent estimates of a basket of properties. Also theres nowhere near enough transactions to use as reference for the estimates so in reality the monthly ups/downs are a sick joke. They moved to estimates some years ago due to lack of transactions for real stats. The press releases are absolutely farcical at this stage.

Apartments in Dublin down circa 50% which isn't all that great compared to rental yield which is now at around 6%. Should be at 10% given recession, lack of cash for investment and the stink that is Irish Property.