Housing Bubble Bursting

The_Conductor

jobless wrote:

what is it at the moment?

FTBs get 133/month for a single person or 267 for a couple.
All others get 50/month for a single person or 100 for a couple (as of the 01.01.2007).

The_Conductor

whizzbang wrote:

hmm, I thought you were meant to lower prices when you weren't getting business?

I think they must have been chatting with the builders about not dropping prices.......
It doesn't make sense- "We're loosing money- lets increase prices and alienate even more clientele......"

The_Conductor

El Stuntman wrote:

Hard Times? :eek:

Bleak House?

or, if you are a VI, maybe Great Expectations.....;)

Lol.....
Take your pick

whizzbang

smccarrick wrote:

I think they must have been chatting with the builders about not dropping prices.......
It doesn't make sense- "We're loosing money- lets increase prices and alienate even more clientele......"

"That'll bring the punters in!"

Jonny Arson

Zambia232 wrote:

Are they gonna promise to back date it ?

April 30th - http://www.examiner.ie/irishexaminer/pages/story.aspx-qqqg=ireland-qqqm=ireland-qqqa=ireland-qqqid=31862-qqqx=1.asp

pwd

on rte news last night they were pushing the idea that the stagnation of the housing market is due to the reluctance of first time buyers to buy until the stamp duty issue has been resolved.
Which doesn't seem to be the case from what I've read here...

afuera

Be warey of political party promises in that they all come with the caveat that if there is a downturn in the economy they can and will row back on some of these promises.

Now thats not to say there will be a massive down turn or anything but its a get out clause.
Knowing politicians a percentage or two of a drop in growth and they'll enact their caveat.

afuera wrote:

Besides some of the most undesirable areas in Ireland, you'll be very hard pushed to find a property where the mortgage costs anything close to the rent these days.

I know of at least one 2 bed appartment in south Dublin where the rent is covering the mortgage at the moment or just about and its a 20 minute walk from the Luas.
I'd imagine in the current climate it's not the only one.
It's ridiculous money for rent but it's happening.

Zambia

This really stinks of vested Interest, So with all big three stating SD will fall.

How quickly can FF or any Party implement this if they are voted in

Duckjob

Yeah, FFs latest stunt on SD is really turning my stomach with this...

All parties need to step back and let the property market correct itself, but they're all intent on using it to score votes.

Trouble is, it may temporarily create a certain amount of false confidence in the market but it's unnatural and it's going to be more damaging to everybody in the long term.

whizzbang

Duckjob wrote:

Trouble is, it may temporarily create a certain amount of false confidence in the market but it's unnatural and it's going to be more damaging to everybody in the long term.

que the dead cat bounce.

mel123

smccarrick wrote:

FTBs get 133/month for a single person or 267 for a couple.
All others get 50/month for a single person or 100 for a couple (as of the 01.01.2007).

This mite be a stupid question, but the FTB's allowance, how long does 133/month last...is it for the first year or however long u stay in the property??

Also, RTE website says:
Under the Fianna Fáil proposals, stamp duty would be abolished for first-time buyers, with the change made retrospective to 30 April, a measure that is likely to remove uncertainty in the housing market.

In addition, the ceiling for mortgage interest relief for first-time buyers would be increased from €8,000 to €10,000 for single people, and double that for couples or widowed first-time buyers, a measure that would be introduced in the next Budget.
Is this ceiling only being increased for FTB's, no mention of people who already own a property??

The_Conductor

Relief is granted for the first 7 years of the mortgage.

The ceilings on relief are adjusted periodically- if they were increased, as is proposed, the increased ceiling would be applicable for the remainder of the 7 year term for a purchaser(s).

The_Conductor

Zambia232 wrote:

This really stinks of vested Interest, So with all big three stating SD will fall.

How quickly can FF or any Party implement this if they are voted in

Allowing that it would be late June before the Oireachtas formed a new government- it would take a few weeks there-after to enact it- so mid/late July would be an approximate timeframe.

The government is not presented to the Oireachtas until 21st of June- almost fully a month after the election.

tHE vAGGABOND

The government is not presented to the Oireachtas until 21st of June- almost fully a month after the election.

Depending on who gets what vote wise, it could always take longer than that, if there is a lot of horse trading as part of getting a government together among several parties..

gurramok

smccarrick wrote:

FTBs get 133/month for a single person or 267 for a couple.
All others get 50/month for a single person or 100 for a couple (as of the 01.01.2007).

As said, its a ceiling and 133 or the new level is not automatic entitlement.

It depends how much interest a FTB pays in a given year, most FTB's wouldn't be entitled to the max relief anyway unless they take out huge jumbo mortgages.

chump

I think FF's gesture is quite restrained. Certainly more so than tampering with the higher bands and reorganising the whole banding structure of stamp duty.

Rew

Victor wrote:

What happens if there is a regime change and they get a better offer?

We didnt accept it anyway but they could have takebn a better offer if it had come.

Were thinking of forgetting Maynooth in favour of Kinsealy or the like.

uberwolf

Tristrame wrote:

I know of at least one 2 bed appartment in south Dublin where the rent is covering the mortgage at the moment or just about and its a 20 minute walk from the Luas.
I'd imagine in the current climate it's not the only one.
It's ridiculous money for rent but it's happening.

the apartment complex I live in, 25 minutes walk from the green, and on the luas line, the current rental levels would cover a p&i mortgage.

ronbyrne2005

uberwolf wrote:

the apartment complex I live in, 25 minutes walk from the green, and on the luas line, the current rental levels would cover a p&i mortgage.

Tristrame wrote:

I know of at least one 2 bed appartment in south Dublin where the rent is covering the mortgage at the moment or just about and its a 20 minute walk from the Luas.
I'd imagine in the current climate it's not the only one.
It's ridiculous money for rent but it's happening.

Please post examples from DAFT of selling price and rental rate for such properties in Dublin please. I find it hard to beleive rents are near a mortgage repayment on apartments in Dublin and definetely not houses.

gurramok

As i had mentioned earlier that confidence in the banks/construction companies is falling, then there is todays headline in Business section of RTE:

'Property uncertainty hits the stock market'
Concerns about the property and construction sector have been spreading to the stock market in recent months. Shares in some banks and building companies have been slipping.

Yesterday cement supplier Readymix said it found orders by housebuilders were falling. Over the past three months shares in builders merchants Grafton are down 7%, McInerney has fallen 4% and bathroom maker Qualceram is down 14%.

The banks have also been affected, due to concerns about growth in mortgages. Bank of Ireland shares are down 7% and Irish Life and Permanent has fallen 10%.

Liam Boggin of Merrion Stockbrokers said that the impact of rising ECB rates and concerns over the affordability of housing have affected the stock market in recent months.

VoidStarNull

If property owners and developers would cut their prices faster, throughput in the
market would pick up. Sustaining throughput needs to be the priority (since
otherwise we don't need all those estate agents/mortgage brokers/construction
workers/etc).

To achieve a soft landing, prices need to fall. But owners (especially developers)
are refusing to accept the pain of lower prices.

eirmail

VoidStarNull wrote:

If property owners and developers would cut their prices faster, throughput in the
market would pick up. Sustaining throughput needs to be the priority (since
otherwise we don't need all those estate agents/mortgage brokers/construction
workers/etc).

To achieve a soft landing, prices need to fall. But owners (especially developers)
are refusing to accept the pain of lower prices.

The definition of a softlanding from the vested interests last year was a rise of 3-5 percent per year inline with inflation.

Has the definiton of a softlanding somehow changed?

I see any price drops from the peak as a correction, and above 20 percent as a crash.

VoidStarNull

eirmail wrote:

The definition of a softlanding from the vested interests last year was a rise of 3-5 percent per year inline with inflation.

Has the definiton of a softlanding somehow changed?

I see any price drops from the peak as a correction, and above 20 percent as a crash.

A soft-landing for whom is definitely the question!

From the point of view of people employed in the industry, a soft-landing means
throughput has to remain as high as possible as long as possible. They don't earn
money from houses that don't sell.

Throughput is maximised at the price-point determined by supply/demand in
the free market. So if owners won't drop their prices fast enough in a falling
market, then throughput will decline.

Owners are waiting for the government to reduce the price "by proxy", by
eliminating stamp duty. That's not to say that eliminating stamp duty is not
a good idea - anything that cuts the price is a good idea.

jobless

VoidStarNull wrote:

A soft-landing for whom is definitely the question!

From the point of view of people employed in the industry, a soft-landing means
throughput has to remain as high as possible as long as possible. They don't earn
money from houses that don't sell.

Throughput is maximised at the price-point determined by supply/demand in
the free market. So if owners won't drop their prices fast enough in a falling
market, then throughput will decline.

Owners are waiting for the government to reduce the price "by proxy", by
eliminating stamp duty. That's not to say that eliminating stamp duty is not
a good idea - anything that cuts the price is a good idea.

I suppose a soft landing is hard to define..... reason is because one has never happened before in any housing boom... so we are going to be a one off case, or so were told by all the guys who rely on the market

daveirl

This post has been deleted.

jobless

daveirl wrote:

This post has been deleted.

I'm sure we'll hear a lot more VI bullshiit phrases like this in the coming weeks...

whizzbang

jobless wrote:

I suppose a soft landing is hard to define..... reason is because one has never happened before in any housing boom... so we are going to be a one off case, or so were told by all the guys who rely on the market

I think it is one of those "I'll know it when I see it" things

this way if prices drop 30% they can say its a soft landing as most people in the country are not in negative equity. chancers.

El Stuntman

daveirl wrote:

This post has been deleted.

I prefer these:

'our unique demographics'

'just because it happened in England/Netherlands/Japan (insert your own bubble) doesn't mean it will happen here'

'we need to be careful not to talk ourselves into a recession'


mmmm, spin, spin, spin

whizzbang

El Stuntman wrote:

I prefer these:

'our unique demographics'

'just because it happened in England/Netherlands/Japan (insert your own bubble) doesn't mean it will happen here'

'we need to be careful not to talk ourselves into a recession'


mmmm, spin, spin, spin

"This time it's different"

when you hear this, run....

VoidStarNull

The economists who work for the banks, estate agents, government, etc,
know very well that in the long run house prices are static relative to household
incomes. Volatility relative to incomes is always corrected in the long-run.

This fact is not only predicted by economic theory but very well confirmed in
the data from every advanced economy in the world.

The general population seem to be unaware of this fact, leading to a situation
where many small investors and owners have not protected themselves against
the possibility of a downturn.

The "spinners" have certainly helped to contribute to this...