Eddie Hobbs: "Starter homes will be 175,000 euros in 2 years"

blast05

Eh you're away with the fairies at this stage.

Surely you are not naive enough to think that builders were not putting cash away and out of site of the revenue to cover for a rainy day .....

SimpleSam06

blast05 wrote: »

Surely you are not naive enough to think that builders were not putting cash away and out of site of the revenue to cover for a rainy day .....

Surely you're not naive enough to think the banks or revenue commissioners would let anyone get away with a rudimentary, half thought out plan like that. It kind of reminds me of the time one of my sales reps wanted a commission on the VAT, he said "sure that's optional anyway", the mystical magical world of people who have never been audited.

Also you seem to be confusing builders with developers.

Saskia

So a couple of months on and it looks like this is no "soft landing" but a full on "crash" is imminent or here depending on the source you read. Will we see these 175k homes this year?

gurramok

Ironically you mentioned it. A developer slashed prices in Athumley, Navan last week by 50%. A few 3beds sale agreed for €175k. http://www.meathchronicle.ie/articles/1/36193/

It's a start. The hint there, slash the price and they will come as prices are the problem for the buyers who can/would like to buy. Its a once off event but the odds of it happening again soon where people want to live is very slim unless the banks force the issue on developers.

jimmycrackcorm

gurramok wrote: »

Ironically you mentioned it. A developer slashed prices in Athumley, Navan last week by 50%. A few 3beds sale agreed for €175k. http://www.meathchronicle.ie/articles/1/36193/

It's a start. The hint there, slash the price and they will come as prices are the problem for the buyers who can/would like to buy. Its a once off event but the odds of it happening again soon where people want to live is very slim unless the banks force the issue on developers.

I think Eddie might be referring to starter homes in Dublin for €175k. I saw a new 4 bed in Letterkenny advertised for €139k.

foxy06

I have been watching a particular house in Bray that was 275,000 for the last few months and has just dropped to 220,000 this week. Thats some drop.

20goto10

I couild put my home up for €1mill and then drop the price by over 60% to get a asking price that would trigger interest. Low and behold house prices in my estate have dropped by 60% :rolleyes: The mania of the boom is alive and kicking, its just upside down now.

Also, think about how a person sells their home in the current climate. Do you look at similar homes on myhome.ie and put it up for that? Maybe, but you start high, see how you get on and then start to drop your price in increments until people bite. So clearly asking prices are not realistic to start with. Even the vendors know this. Its a false gauge. The real guage is what houses are selling for. Something nobody has access to. So basically you're all speculating about what house prices are based on asking prices or how much the value has dropped based on intentionally unrealistc starting prices.

asdasd

So basically you're all speculating about what house prices are based on asking prices or how much the value has dropped based on intentionally unrealistc starting prices.

Nope. The statistics for asking price falls are out there - 15% y-o-y according to daft. Sales prices are considerably lower than asking prices, and the best estimate there is a 30% drop y-o-y ( from Estate agents).

20goto10

asdasd wrote: »

Nope. The statistics for asking price falls are out there - 15% y-o-y according to daft. Sales prices are considerably lower than asking prices, and the best estimate there is a 30% drop y-o-y ( from Estate agents).

Yes, exactly what I'm saying. Nobody knows the actual figures. So its all speculation. The drop in asking prices has nothing to do with it other than to indicate we are in a decline. As I've said, I can put my house up for an asking price of €1mill and drop it to €500K, it doesn't mean the value of my house has dropped 50%, it just means I put up a ridiculous asking price. Soemthing you can say happens a lot here in Ireland. It has no reflection at all on the state of the economy, the sate of the industry or the worth of Irish homes other than to indicate we are in a decline.

asdasd

As I've said, I can put my house up for an asking price of €1mill and drop it to €500K, it doesn't mean the value of my house has dropped 50%, it just means I put up a ridiculous asking price

Thats a rehtorical anecdote, not a statistic. You could do that if you didn't want your house to sell, but why put it up? Most people look at MyHome, or Daft and map to that. Once someone on the same streett undercuts them they will reduce ( in asking price) . This is orthogonal to selling price which which is going to be lower than asking price these days.

So nody is reallt speculating. Asking prices are down 15%, and selling prices somewhat more than not. Not less.

3DataModem

Deleted User wrote: »

The whole concept of a "starter home" is wrong in the first place!
It was simply an excuse to build places that dont suit long term living in a market where people were buying anything because prices were going UP!

Best post I've read today, or probably this month.

20goto10

asdasd wrote: »

Thats a rehtorical anecdote, not a statistic. You could do that if you didn't want your house to sell, but why put it up? Most people look at MyHome, or Daft and map to that. Once someone on the same streett undercuts them they will reduce ( in asking price) . This is orthogonal to selling price which which is going to be lower than asking price these days.

So nody is reallt speculating. Asking prices are down 15%, and selling prices somewhat more than not. Not less.

That should be called the "disillusionment index", nothing more. Unless you have factual figures then you are speculating.

asdasd

Unless you have factual figures then you are speculating.

Since we cant really get factual figures on selling prices we can only speculate. There is over informed speculation, and misinformed speculation.

What we are not speculating about is asking prices down 15% y-o-y. Thems figures from DAFT.

Also non speculative is the claim that asking prices are higher than selling prices in a bust. We know that to be the case because were selling prices higher then asking prices would increase.

Also non speculative is the claim that housing prices fall in a recession, and Ireland is at the start of a big recession.

The actual percentage is speculative ( although Estate Agents claim 30% y-o-y).

I believe that sounds about right.

shoegirl

gurramok wrote: »

Hate to break your bubble but some 'starter homes' are already at 190k in Balbriggan for example.
They are apts but the downward slide is only beginning and 175k is very realistic for the near future

They are even less in parts of Cork.
You can get small properties for 1 person from as little as 120k in less desireable areas. And less if significant repairs are required.

shoegirl

20goto10 wrote: »

I couild put my home up for €1mill and then drop the price by over 60% to get a asking price that would trigger interest. Low and behold house prices in my estate have dropped by 60% :rolleyes: The mania of the boom is alive and kicking, its just upside down now.

Also, think about how a person sells their home in the current climate. Do you look at similar homes on myhome.ie and put it up for that? Maybe, but you start high, see how you get on and then start to drop your price in increments until people bite. So clearly asking prices are not realistic to start with. Even the vendors know this. Its a false gauge. The real guage is what houses are selling for. Something nobody has access to. So basically you're all speculating about what house prices are based on asking prices or how much the value has dropped based on intentionally unrealistc starting prices.

That works both ways. Take a look at Daft.ie for prices for 3 bedroomed houses on the Riversdale estate in Rathcormac Co Cork. You will see anything from 170k to 270k for almost identical houses. What is happening there is that some sellers who maybe purchased when the houses originally went on the market for 160k can easily afford to drop the price to 170k, but not the people who bought at the peak of around 270k. Thats why you will see some prices for identical houses stubbornly high when there are vastly cheaper alternatives.

Raiser

the_syco wrote: »

Bullsh|t. Unless you used substandard crap, have thin walls, and slash the wages of the trades people (someone mention union?), I can't see such a drop.

Substandard with thin walls etc is standard.

Sites are now smaller than the average flowerbed and rooms are getting so small you'd feel like Gulliver on inspecting a lot of new properties.

- Also how are were the profit margins so ridiculously high if they weren't overcharging beyond belief.

Personally I reckon that €175K is a lot to ask for a lot of the crappy dolls houses out there.

oceanclub

Doing the usage rental yield on a €175,000 house, you get:

175000 / 11 / 16

= €994

That doesn't sound like a unreasonable rent for such a house any more, so neither does the value.

P.