House prices in Charlesland.

Eoin

evectm wrote:

you have to admit there are an awful lot of houses/apts for sale for a small area.. does this not tell us something is wrong ?.. not snotty replies to me ( please ) !

That's always going to be the case for that kind of development. There are a lot of investors there who will always have wanted to sell up after a couple of years, and probably a few couples like myself and the WTB who enjoyed living there, but got sick of apartment living and wanted a house.

Not that I'm blind to the prices dropping; the 2 bed apartments late last year were averaging around the 375K mark - don't know if any broke the 381 barrier, but they were certainly selling for right up to it.

evectm

Were they not just over valued to start ? Were the 2 beds up for and selling at the 380k mark ?I saw them on myhome.ie for that price but that was just at the very top end of the market i spoke to an auctioneer who had one up for - i cant see them going above the 365k to370k. The 2 bed houses the same they were on there last year up to 430 and now there are some on at 390k mark. It has to come down as nothing is worth what people were asking.. the estate agents are pushing and pushing up the prices and people stopped giving them.There seems to be a fall off in sales in all areas ofIreland - but there is sooo many properties in Charesland for sale - it jsut does not seem right. There is some places for Sale there for 9 months and still no sale.. if that does not tell us something..

Eoin

evectm wrote:

Were they not just over valued to start ? Were the 2 beds up for and selling at the 380k mark ?I saw them on myhome.ie for that price but that was just at the very top end of the market i spoke to an auctioneer who had one up for - i cant see them going above the 365k to370k. The 2 bed houses the same they were on there last year up to 430 and now there are some on at 390k mark. It has to come down as nothing is worth what people were asking.. the estate agents are pushing and pushing up the prices and people stopped giving them.There seems to be a fall off in sales in all areas ofIreland - but there is sooo many properties in Charesland for sale - it jsut does not seem right. There is some places for Sale there for 9 months and still no sale.. if that does not tell us something..

Last September when we out our place on the market, the two bed apartments were going for up to 380K, and the two bed town houses were around the 420 mark from what I remember.

I think their initial purchase prices were about 100K less each?

DTinthegrove

It's not just Charlesland, Applewood heights has 10 houses for sale, some on for more than 90 days now, no interest because of affordablity. People can't sell their house for the price they need(want), can't borrow any more or don't want to borrow any more.

I'd say the % of properties for sale in Charlesland (ie as a proportion of the number of properties in estate) is probable the same as the % of properties for sale in Applewood.

Figures out today show that year to date house prices are down by over 2% and inflation is running at 5%. So if you bought a 3 bed end of terrace for €540k in December you are €11k down, plus what you spent on stamp. Thats not nice.

Potentially 3 more interest rate rises before spring 08 means we are likely to see some larger prices drops if people really want to sell. If they don't really want to sell then they should keep the prices at the same level, but might as well take them off the market.

Don't get me wrong, I do feel SO sorry for those who may have negative equity, because of the irresponsible banks and developers. Again I am not being negative love Ireland, love Greystones love Charleslands just expressing my thoughts and just looking at what going on around us, in my opinion.

DTinthegrove

It's not just Charlesland, Applewood heights has 10 houses for sale, some on for more than 90 days now, no interest because of affordablity. People can't sell their house for the price they need(want), can't borrow any more or don't want to borrow any more.

I'd say the % of properties for sale in Charlesland (ie as a proportion of the number of properties in estate) is probable the same as the % of properties for sale in Applewood.

Figures out today show that year to date house prices are down by over 2% and inflation is running at 5%. So if you bought a 3 bed end of terrace for €540k in December you are €11k down, plus what you spent on stamp. Thats not nice.

Potentially 3 more interest rate rises before spring 08 means we are likely to see some larger prices drops if people really want to sell. If they don't really want to sell then they should keep the prices at the same level, but might as well take them off the market.

Don't get me wrong, I do feel SO sorry for those who may have negative equity, because of the irresponsible banks and developers. Again I am not being negative love Ireland, love Greystones love Charleslands just expressing my thoughts and just looking at what going on around us, in my opinion.

DTinthegrove

See i'm new to this, must have pressed the button twice

Hammiepeters

Langerland wrote:

Prices are certainly falling from where they were last year, but I'd say its far from any type of crash. People are more vulnerable in areas where they have paid way over the odds for houses that are clearly not worth it. However, Charlesland has a lot to offer in my opinion. Greystones is a great place to live and has a lot to offer. I cannot see how there would not be a demand to live there. Rose tinted glasses??:D I don't know...I am optimistic.

Langer, it is refreshing to hear your views. What you say is correct. Price drop announced today of 2.5k nationally in the year of election and stamp duty reform. Hardly a national calamity! Have seen a sale agreed sign go up on a 2bed alreadty this week. Very sick and tired of people talking this thing down and down. Three beds have jumped nearly 200k since release. That sort of growth is obviously not sustainable and an adjustment of the sort we've seen will slow the growth to a realistic level. I still think we can expect 3-4% annually this year and next year.
There has always been a lot of negative whinging about house affordability as long as I can remember, yet people buy houses. Interest rate increases are to be slightly offset in December budget. If anyone sells a house due to uncertainty they will be entering a rental market which is already going through the roof.

Hammiepeters

DTinthegrove wrote:

Figures out today show that year to date house prices are down by over 2% and inflation is running at 5%. So if you bought a 3 bed end of terrace for €540k in December you are €11k down, plus what you spent on stamp. Thats not nice.


Cheapest 3 bed EOT is €535k and thats because he wants to sell quickly. Stamp duty paid by first home buyers(and remember there were only 3,000 FTBs who paid it last year) is lost money.

Hammiepeters

I see in todays paper that whilst prices fell nationally in May, the counties Wicklow, Kildare and Meath actually show increases in house value for May. Still think Niall O'Grady the most straightforward of the analysts in the housing market/mortgage game.

DTinthegrove

Don't think this discussion is going any where there will always be conflicting views but 3-4% rise in prices this year is NOT going to happen.

I wish the people selling their house the best of luck and i am not being negative about Charlesland or Greystones but affordablity has to come down and it would be good for the economy in the medium/long term if it does.

3 Bedroom end of terrace Charlesland €535

First time buyer with deposit would need to borrow half a million euros, half a million euros!! 17 times average national wage, over 6 times salary if you are lucky enough to earning €80k.

Non First time buyer, face a stamp duty bill of 40K so an out lay of €575. Say 150k equity they still need to borrow 13 times average national wage, over 5 times salary if you are lucky enough to earn €80k.

Mad, mad mad. The best thing would be for affordability to come back for everyone. I own a 3 bed end of terrace and would NOT pay €535 for it, way too expensive €400-€420 would be a realistic price.

Eoin

DTinthegrove wrote:

Don't think this discussion is going any where there will always be conflicting views but 3-4% rise in prices this year is NOT going to happen.

I wish the people selling their house the best of luck and i am not being negative about Charlesland or Greystones but affordablity has to come down and it would be good for the economy in the medium/long term if it does.

3 Bedroom end of terrace Charlesland €535

First time buyer with deposit would need to borrow half a million euros, half a million euros!! 17 times average national wage, over 6 times salary if you are lucky enough to earning €80k.

Non First time buyer, face a stamp duty bill of 40K so an out lay of €575. Say 150k equity they still need to borrow 13 times average national wage, over 5 times salary if you are lucky enough to earn €80k.

Mad, mad mad. The best thing would be for affordability to come back for everyone. I own a 3 bed end of terrace and would NOT pay €535 for it, way too expensive €400-€420 would be a realistic price.

Does "Affordability to come back" not mean a lot of people in negative equity?

DTinthegrove

Yes unfortunately for some in the short term, 1-5 years. This would give wage inflation time to play catch up, so medium -long term = more sustainable and affordable houses prices.

Hey but what do i know? The Goverment is very protective of the economy's over dependance on the construction industry so they may come up with some thing radical in the next budget.

Increase in mortgage interest relief is welcome but not radical. Interest relief rewards people for being in debt which i think is a bit strange, but not complaining as we use it to pay of our mortgage quicker,

Eoin

DTinthegrove wrote:

Increase in mortgage interest relief is welcome but not radical. Interest relief rewards people for being in debt which i think is a bit strange, but not complaining as we use it to pay of our mortgage quicker,

It's not radical, but for 2nd hand houses I think it's the only way to give the savings to the buyer, not the seller. I really think any changes have to be as intangible to the seller as possible. Increased mortgage relief is one such way. I wonder if allowing stamp duty to be partly deductable for tax returns / credits would be another way (for owner occupiers only).

When we sold our apartment last September, the prices were going right up to the stamp duty threshhold of 381K. If the changes to stamp duty had been in place at that time, then they may have been going for even more.

I do realise that the increase in price would not have been equal to the cost of the stamp duty, and the same amount of hard cash would not have been required up front, but it still increases the prices.

Hammiepeters

I dont know when people are going to realise that housing prices have nothing to do with worth. Its what people will pay. Pay to live in Ireland because the Economist listed us as the best country in the world to live in, 2005. Pay to live in Dublin, because thats where the jobs are. Pay to live in Wicklow for the amenities and envoironment and because its close to Dublin.
A quick look at international properties, eg. USA, Australia will show you what you can get for 500k is vastly superior to here except that it is not here. And here is not South Kensington where people will pay 1million for a shoebox. Talk it up.Its your asset. Wicklow prices recovered in may. There is only one EOT at €535. Stamp duty reform was only ratified today.

DTinthegrove

I agree the market is about what people will pay OR are willing to pay OR Can Pay. People will pay what they thinks its "worth" to them what ever that might be.

This worth has been talked up by EA, developers and banks to a point way above what people can actually afford. Hence, we are the most indebted nation in the world.

I might think its worth paying €5million for a flat in Kensington, but i probably have to finance this and the cost of me doing that has doubled since 2005, but i'm not likely to have doubled my income since 2005.

The increase in the cost of borrowing has a massive effect on what you can pay/are willing to pay and it likely to go up by another 19% yet (4.00-4.75%)before spring 2008.

Cost of pre school education, services, electricity, gas, petrol etc have all gone up quicker than the average salary all adding to people feeling the pinch.

mikedragon32

DTinthegrove wrote:

I might think its worth paying €5million for a flat in Kensington, but i probably have to finance this and the cost of me doing that has doubled since 2005, but i'm not likely to have doubled my income since 2005.

The increase in the cost of borrowing has a massive effect on what you can pay/are willing to pay and it likely to go up by another 19% yet (4.00-4.75%)before spring 2008.

How has the cost of doing that doubled since 2005? If interest rates double, that doesn't mean your mortgage repayments have doubled.

It strikes me that you are spinning figures to suit your pessimistic outlook on the property market.

DTinthegrove

To clarify, I thought I said the cost of borrowing has doubled ie the interest rate, sorry may be this wasn't clear.

Of course repayments haven't doubled.

Mortgage repayments for most people would be one of the biggest, if not the biggest monthly outgoing and the cost of servicing this Mortgage ie the interest has doubled.

Surely this is significant for most people and would mean they have less disposable income and they may not be able to borrow as much, which will have a large effect on house prices in Charlesland and Ireland in general.

Sorry if you view me as pessimistic, but i am just discussing my veiws at this moment in time, I don't say am right at all and i thought this is what this forum was for.

I'm am actual very optimistic about Charlesland and Greystones in the medium/long term and optimistic compared to some economist suggesting yesterday a 50% drop in value in the next 10 year.

Hammiepeters

I'm sorry Dee, but didn't you post earlier that if you were in a hurry to sell,you would consider dropping your EOT from a peak value of 555k to 400K? That does not strike me as optimistic. And yes I agree with Mike, you did put a spin on the figures above to create an alarmist impression of peoples outgoings having doubled. All this stuff about average this and average that simply does not apply here. So many houses are dual income proffessional people who know that what seems like a collosal borrowing today will not seem that way in 10years. Always was that way. Allways will be. And yes the 50% drop guy got his name on every station and every paper. which is what he wanted.

Hammiepeters

And accomadation, not necessarily mortgage repayments are peoples highest outgoing. In other words , there a hares breath between a months rent on a 3bed EOT and repayment on what many of us borrowed If I sold up and rented I would not be much better off and if I was still renting, I would want to buy.

fishdog

The truth is the cost of living in this country is crazy and people are sick of it. Childcare for my 4 year old costs me almost €1000 per month. This goes up every 6 months. Mortgage reypayments, running a car, interest rate hikes etc, etc. I am not pessimistic, I feel lucky that I own a home and my repayments are not as large as many others.

Most of the property in Ireland is massively over priced. It is not so much of a case that people will not take it any more, it is that they simply can not afford it anymore. They have no choice, the banks will not lend them the amount they need to borrow. I know many people that have only been able to borrow the amount that they have by telling lies!

I still believe that property prices will drop 5% or so this year, but not much futher. You will still be ahead if you bought 3 years ago, I think. But there is no way that prices do anything but drop this year.

Hammiepeters

Fish. In many ways you are right.Things are expensive. Yet latest ERSI ''you've never had is so good''. Stories of widening gaps are apparently bs. When I came to this country 5 years ago(totally broke), people were saying much of what you just wrote. Ruairi Quinn was warning of a housing shortage crisis(in the Dail). Guess what . It didn't happen. People told me to forget Dublins hinterland on my salary/job I'd never afford it. Think Cavan and commute! Then an irresponsible credit union lent me money and a with alittle saved an irresponsible broker got me a mortgage from an irresponsible bank to buy a house where an irresponsible developer had built Charlesland due to wicklow having being opened up due to the construction of an irresponsible road. Now three years on with some money paid back I have over 200k equity in the house so that if i want to go back to my other country, i can buy a house outright. Find me a building to jump off.I feel so.............responsible.
No seriously fish, all the houses built in cavan,carrick on s, enniscorthy, etc were built eith too much optimism and will pull down the national average this year. But Wicklow has only dropped 2% this year and recovered some in May.

Hammiepeters

And I feel for you on the childcare issue. That is obsene.

DTinthegrove

Fishdog, agree with you 100% about the cost of living, and would say 5% drop is realistic for this year, which given inflation is actually a 10% drop which will help affordability a little.

The key thing is what happens then, i think it will drop further as people won't want to come back to a market that's droping.

Hammiepters, you are very lucky with your €200K equity but it's paper money until you sell so don't get too carried away. You seem to be suggesting that Greystones will avoid any problems in the property market as it attracts people that are above average in terms of salary, dual income professionals.


You are probably right with respect to the number of professionals in Greystones, but I fail to see how this will protect us. We currently pay much higher prices than the average house price, and as the average price falls so will the price in Greystones, but it will remain above average.

As Fishdog points out people are starting to struggling with the cost of mortgages, child care , cost of living and are not able to borrow as much as 2years ago, hence prices will have to fall.

I can know 10 professional couples with family (friends) earning good money, say between €80-150k and all of them would say that at suggested houses prices today 1) they can't afford to move 2) If they were looking to buy the house that they bought 2-3years ago at todays price they would not be able to afford it!

Hammiepters, you keep going on about the past but most people would see that things have changed alot in 2-3year. We are no longer the best place to live in the world (according to the poll quoted earlier), we have lost major ground when it comes to being competitive, the cost of living is very high, inflation is at 5% etc.

The economy is still in great shape for this year, but going forward things seem to be slowing to a sustainable level (NOT recession), which is good news.

Love Ireland, love Greystones, Love Charlesland all WILL work out in the long term. BUT no one has yet to convince me other wise that in the short term we have a few problems ahead and that includes a big fall in house prices, negative equity for some.

Ireland has a very flexible economy and the Goverment could rise to this time of opportunity and make some radical policy changes that could help us all and lets hope they do.

DTinthegrove

Hammiepters, you really shouldn't joke about jumping of a building it may offend given what Berty said yesterday.

mikedragon32

DTinthegrove wrote:

5% drop is realistic for this year, which given inflation is actually a 10% drop

Huh?

Simple fact of the matter is this. Okay, people may not have the spending power to buy into Charlesland now, but surely those of us who are here are not going to panic sell at a much reduced price just to sell our homes?

Please bear in mind that we are not in recession. Growth is slowing down, but it's still growth. That means, by and large, incomes are secure. This in turn means that we can still afford our mortgages and are not in a position where we are forced to sell.

My own prediction (seeing as everyone else fancies themselves as Mystic Meg) is that house prices in Greystones generally will fall about another 3% - 5% in the next 9 months. That means that anyone who bought up to about a year ago and maybe more recently shouldn't lose out.

But just to reiterate my point. There is NO recession, only slower growth, in our economy.

For now you can all take your finger away from the panic button!

Hammiepeters

Dee. I think that if you were selling a house at the moment. You would practically give it away. You have just let yourself get bogged down in a lot of negative information. You have a negativity bias towards any information on this subject, are ignoring any positive facts(Nth Wicklow most valuable RE in Ireland, Prices in Wicklow improved in may,etc) and your outlook despite your protests to the contrary, seems black.
People are not worse off today than they were three years ago. Its just simply not true. It has always a juggling game of house, kids,cars,holidays, etc.
This property crisis(in peoples heads) was kickstarted by the tanaiste last year in an unbelievable statement about stamp duty. He said ''we dont really need that money''. What a joke. Where else was it going to come from in a low tax economy that he himself had mooted?
The result of the speculation that followed was, a jittery reaction from people who saw that (predicably)buyers were holding off to see what happened.
The stamp duty issue is now resolved. Bury it for another five years and move on. Maybe Bertie had a point

DTinthegrove

In a market where house prices are falling and interest rates are on the way up at what point do people feel safe to go back in to the market? That will drive the size of the fall, could only be 5% could be more. I'm going to ask Doctor Who to transport me in to the future.....

Again I haven't got a clue and I'm just discussing what I see around me. Lets have this conversation again in Dec 07 and Spring 08 and see how its all unfolds as most people looking at this must be bored stiff by now thats for sure!

Eoin

DTinthegrove wrote:

In a market where house prices are falling and interest rates are on the way up at what point do people feel safe to go back in to the market? That will drive the size of the fall, could only be 5% could be more. I'm going to ask Doctor Who to transport me in to the future.....

What about people who are upgrading? The falling prices mean that their homes are more affordable to new buyers, and as the house they are moving to is

1) more likely to cost more than their current one, and
2) also falling in price

that means that the balance payable to upgrade is less. We would probably have made 10K less if we had sold our 2 bed apartment in the Grove now, but I'm fairly sure that we could have gotten our current house for at least 10K less than what we paid for it, so it would have balanced out. There would have been a tiny bit less stamp duty also.

Hammiepeters

Sorry if my posts were more than a little curt today. Just had a conversation with the reptile next door(with whom I've shared two words in two years) who told me by way of complaint that she was selling her house because she did not like the noise made by my 7 year old autistic daughter. I can assure you guys that she is no pitbull(my daughter that is).
I guess I had just had it with whinging. And no D and fish I would not say you are in the premier league in this regard.
I see the stock exchange showed record figures today. Something like 102million euro, telephone numbers really.
But what will it profit a nation if it should gain the world and lose its soul?

Hammiepeters

Folks, keep in mind there used to be a season for buying and selling. And it is not the middle of a bad summer. come September when people are back at work and the weather is gorgeous (because you are back at work) the buying season will reopen and things will pick up. Yes residential building will be down. But that means that the second hand market will improve a bit. and now that there is no stamp duty on second hand for first home buyers, that will help. greystones is a gorgeous place to live. Walk down the mainstreet on a sunny evening and enjoy the footpath cafes. Groovy and posh boutiques and not a pound shop in sight. Yummy Mummies and well dressed, well fed and educated children. Not skangers hanging around in their tracksuits and Tango tans. And plenty of parking in the Meridian.
Charlesland has a community based around the pharmacy, great girls, excellent advice and you can do all your christmas shopping there, Which I do, thankyou very much. The supermarket has a fresh donut and a paper for me every morning, which I eat and read (in that order) while waiting for my large skinny latte at the coffee shop. gotta have the skinny latte to balance out the donut. We have the sea, and the mountains to look at as we drive to and from our homes. And in a very short time we will have an interchange on the N11 that will have us in the city on a Sunday, within half an hour. A bit longer on a week day I will grant you, but not because of the Delgany lane crawl anymore.

So why dont you all climb down off the crucifix (we need the wood) and look at the bright side of life for a change. Who knows, you might even enjoy a little sniff of the roses.
Breathe in.......Breathe out.....Breathe in.................