David McWilliams predicts further 50% fall in house prices

Fozzie Bear

SoupyNorman wrote: »

Ehhh (right back at you), these estates are in Roscommon and Leitrim and the rest of the BMW region. Planning permission was granted on sites in the arse of nowhere, all part of the building craze. Who in their right mind would or could live there?

Are saying there are 'new build' derelict houses, as I have not seen any.

Half finished houses better stay half finished for the sake of the economy but in the grand scheme of things its's a flippant number that wont have a real impact.

Not necessarily true re just the BMW region. While there are plenty in the BMW region (where I am originally from) there are a hell of a lot around the rest of the country. I was house hunting around the Craughwell and east of Galway city areas on Sunday last and counted 35 large houses (i.e. 4+bedrooms) that were unfinished. The majority were just four walls and a roof, no windowns, doors etc. Thats 35 abondoned new house builds all within 25 minutes drive radius of east Galway city. (And thats just the ones I passed and counted). This trend has to be repeated nation wide as builders/developers run out of finances and have to stop building. Its not simply the BMW region that suffered from bad planning, absurd selling prices and now the bust/resession is it?

Fighting Irish

faceman wrote: »

McWilliams doing what he does best and has been doing since 2000. Lots of soundbytes but not alot of meat behind it.

I dont now how he came to the conclusion it would be 50% really. Who's to say its not going to be 70% or 20%? Its no secret that prices are coming down.

You cant compare mortgage prices side by side with rental values in a market with massive rising unemployment.

If the level of employment was to improve in 3 years time and unemployment started to fall, would we still see a cut of upto 50%? Well its hard to say really, there are other factors to consider. Taxes and relief, CGT.

My fear is more when the market does bottom out and the "time is right" *crystal ball* and there is a rush to buy property because its so cheap causing a race to snap it out over a short to medium term, artificially inflating prices similar to what we saw in 2006.

Price of property is only an issue for homeowners if they want or need to sell. Investors are a different kettle of fish.

Firstly, prices aren't gonna shoot straight back up once the market bottoms out and secondly i can't see prices going anywhere near 2006 levels for donkeys years

Fozzie Bear

smccarrick wrote: »

Mortgage interest relief is abolished after 7 years, and reduced for everyone else- at a time when we have the lowest interest rates, ever, and repossessions are soaring. The agreement to a 2 year moratorium on repossessing delinquent mortgages is the only thing stopping a bloodbath at the moment.

Does this mean that we are just putting the bloodbath off for 2 years? Will things have picked up that much in 24 months that people will be able to start meeting their crippling repayments or have found gainful employment that will pay them 2007 wages i.e enough to cover their debts?
Or will there simply be a raft of repo's and people turfed out of their homes flooding an already saturated market with even more unwanted housing stock?

Thoughts anyone?? Are we simply putting off the unavoidable and giving people false hope?

Fighting Irish

spockety wrote: »

Don't worry, our own property tax is on the way (loads of media plants already happened to soften us up for it). Should have an interesting impact on the property market. Particularly for landlords of properties they are having a hard time filling.

Of all the taxes i hate, yearly property taxes are the worst. In the US what happens if you can't pay the tax?

Fighting Irish

D3PO wrote: »

some good argument and counter argument in this thread I must say.

I dont know how many on here have a background in economics (I certainly dont) but it is a well constructed and well informed bunch of people posting.

seriously we should all run for the Dail Im sure we could do a better job than FF

If you haven't noticed, most smart(people with common sense) have no desire to go anywhere near governments/committees etc etc

The_Conductor

Fighting Irish wrote: »

If you haven't noticed, most smart(people with common sense) have no desire to go anywhere near governments/committees etc etc

Much as I hate to admit it- the manner in which the system works (or doesn't- depending on how you look at it), is soul destroying. With all the best will in the world- and despite my pathological hatred of most public representatives, some of them are really good people, with really good ideas, but no means of conveying their ideas to the public- or implementing them.

Deep down- whether people admit it or not, parochial push pedal politics are at the heart of the Irish political system- very few people are willing to put their neck on the line and breaking free from the system, to try to make a difference. Anyone who does- soon hits other walls- often compliments of the unions- think Mary Harney for example. Those who aren't willing to work within the confines of the current system are ridiculed- or reduced to commentaries from the sidelines- often with an editorial slant a la editors with wholly different political agendas (if they have the intelligence to have an agenda rather than simply fauning on their political masters........)

What really needs to happen is to totally redesign this country from the bottom up. Unfortunately the only people stupid enough to run for public office- don't have the intelligence necessary to run the country......

Fighting Irish

smccarrick wrote: »

Much as I hate to admit it- the manner in which the system works (or doesn't- depending on how you look at it), is soul destroying. With all the best will in the world- and despite my pathological hatred of most public representatives, some of them are really good people, with really good ideas, but no means of conveying their ideas to the public- or implementing them.

Deep down- whether people admit it or not, parochial push pedal politics are at the heart of the Irish political system- very few people are willing to put their neck on the line and breaking free from the system, to try to make a difference. Anyone who does- soon hits other walls- often compliments of the unions- think Mary Harney for example. Those who aren't willing to work within the confines of the current system are ridiculed- or reduced to commentaries from the sidelines- often with an editorial slant a la editors with wholly different political agendas (if they have the intelligence to have an agenda rather than simply fauning on their political masters........)

What really needs to happen is to totally redesign this country from the bottom up. Unfortunately the only people stupid enough to run for public office- don't have the intelligence necessary to run the country......

I'm crap at english and trying to explain stuff but you pretty much summed up my thoughts

Freddie59

Fozzie Bear wrote: »

Not necessarily true re just the BMW region. While there are plenty in the BMW region (where I am originally from) there are a hell of a lot around the rest of the country. I was house hunting around the Craughwell and east of Galway city areas on Sunday last and counted 35 large houses (i.e. 4+bedrooms) that were unfinished. The majority were just four walls and a roof, no windowns, doors etc. Thats 35 abondoned new house builds all within 25 minutes drive radius of east Galway city. (And thats just the ones I passed and counted). This trend has to be repeated nation wide as builders/developers run out of finances and have to stop building. Its not simply the BMW region that suffered from bad planning, absurd selling prices and now the bust/resession is it?

Not just rural areas. There is a housing estate North of the River Suir in Waterford City which is about 2 miles from the City Centre. 56 finished - 16 occupied.

SoupyNorman

Fozzie Bear wrote: »

Not necessarily true re just the BMW region. While there are plenty in the BMW region (where I am originally from) there are a hell of a lot around the rest of the country. I was house hunting around the Craughwell and east of Galway city areas on Sunday last and counted 35 large houses (i.e. 4+bedrooms) that were unfinished. The majority were just four walls and a roof, no windowns, doors etc. Thats 35 abondoned new house builds all within 25 minutes drive radius of east Galway city. (And thats just the ones I passed and counted). This trend has to be repeated nation wide as builders/developers run out of finances and have to stop building. Its not simply the BMW region that suffered from bad planning, absurd selling prices and now the bust/resession is it?

I totally agree that it is country wide, but I think when highlighting the point the BMW region is the best example as you get to say bad things about Roscommon

jmayo

SoupyNorman wrote: »

Ehhh (right back at you), these estates are in Roscommon and Leitrim and the rest of the BMW region. Planning permission was granted on sites in the arse of nowhere, all part of the building craze. Who in their right mind would or could live there?

Are saying there are 'new build' derelict houses, as I have not seen any.

Half finished houses better stay half finished for the sake of the economy but in the grand scheme of things its's a flippant number that wont have a real impact.

As both SMCCarrick and Fozziebear have pointed out it is just not the BMW region that have half finished or unoccupied estates.
Take a drive around Carlow, a commuter town for Dublin has one estate that is empty with entrance gate locked up.

BTW looking at your post you appear to have a condescending atttidue towards BMW region. Planning was also granted in villages and towns in the East with no regard for local infrastructure that couldn't cope with influx of people who would be of course commuting to Dublin.
That is just as bad as giving planning in the ars*whole of nowhere as you term it.

faceman wrote: »

McWilliams doing what he does best and has been doing since 2000. Lots of soundbytes but not alot of meat behind it.

He is more right than the ones who predicted massive growth for the next ten years hasn't he ?

faceman wrote: »

My fear is more when the market does bottom out and the "time is right" *crystal ball* and there is a rush to buy property because its so cheap causing a race to snap it out over a short to medium term, artificially inflating prices similar to what we saw in 2006.

I would bet that is one fear that will not be realised so you should relax.

faceman wrote: »

Price of property is only an issue for homeowners if they want or need to sell. Investors are a different kettle of fish.

Exactly no problem, if you want to continue living in your shoebox for the next twenty years or if you don't lose that job.

ionapaul

There are hundreds of empty apartments within the M50 in Dublin, there could be thousands. Many are unsellable at current prices. Why exactly are we focusing on the BMW region?

SoupyNorman

jmayo wrote: »

As both SMCCarrick and Fozziebear have pointed out it is just not the BMW region that have half finished or unoccupied estates.
Take a drive around Carlow, a commuter town for Dublin has one estate that is empty with entrance gate locked up.

BTW looking at your post you appear to have a condescending atttidue towards BMW region. Planning was also granted in villages and towns in the East with no regard for local infrastructure that couldn't cope with influx of people who would be of course commuting to Dublin.
That is just as bad as giving planning in the ars*whole of nowhere as you term it.

Just to make a point clear, I have nothing against the BMW region (I survived 4years of college in Athlone!).

The reason I focused on that area is because back at the end of the summer last year when things were ''going gimpy" the news and media used those areas in a kind of shock tactic way as they do.

The truth is it is country wide of course but it is also true to say that those areas have quite low levels of development, both in terms of industry and infrastructure (although it's getting better) which makes them less attractive places to live.

The_Conductor

SoupyNorman wrote: »

those areas have quite low levels of development, both in terms of industry and infrastructure (although it's getting better) which makes them less attractive places to live.

You could say the exact same about some areas of Dublin that have turned into monstrosities- look at Lucan- or Clonee for example- absolutely no thought whatsoever given to infrastructure, facilities or amenities- just a 'build the houses and they will come' mentality. As for industry- once again- look at some areas of Dublin- there are more unemployed people in Tallaght than there are in Donegal, Sligo, Leitrim and Mayo- combined.....

The EU Commission organised education tours of Ireland for new memberstates on accession- to show them examples of what the implications of rampant development without a coordinated structural plan would be. Hopefully they learnt some lessons from us- we obviously haven't learnt those lessons ourselves, even now.

The BMW areas were always a favourite with the media- because these were considered to be the 'less developed areas' of the country (and were the lions share of EU structural funds were focused). Much of the development there, while akin to elsewhere, was done solely for tax purposes without any thought given to actual purpose (other than tax shelters). As tax shelters- they were very useful- who wouldn't want to pay no tax- but as a means of providing needed accommodation- they were a disaster.

Politicians tried to use decentralisation as a means of giving many of these areas a boost- but this was an abject failure- because it totally re-wrote social planning, and destroyed the concept of a number of 'gateway towns' in the different regions. Were both financial incentives and other measures targetted to the benefit of these gateway towns- it could very well have been a roaring success- but instead parochial politics stepped in, and any benefit that might accrue got frittered into nothingness- as TDs, Ministers and others- cajolled for their slice of the action for their constituents.

SoupyNorman

smccarrick wrote: »

You could say the exact same about some areas of Dublin that have turned into monstrosities- look at Lucan- or Clonee for example- absolutely no thought whatsoever given to infrastructure, facilities or amenities- just a 'build the houses and they will come' mentality. As for industry- once again- look at some areas of Dublin- there are more unemployed people in Tallaght than there are in Donegal, Sligo, Leitrim and Mayo- combined..... .

I agree with all but this, I don’t believe you can compare the Dublin commuter belt areas with rural areas. The likes of Lucan and Clonee were more like spill off zones for the rapid population growth in Dublin; the reason for the growth was Dublin having a big bright ‘Job Vacancy’ sign hanging over it. I do agree that there was no thought put into incorporating schools/shops/medical facilities into any of these areas which made them inconvenient places to live from the point of view of the home owners.

Areas in BMW and other rural regions will never turn into monstrosities, not even if they ran an Autobahn through it, years of neglect from the government has done irreparable damage, too late for the European subsidies to rectify and certainly too late for any sort of de-centralization to have an impact (even if it was rolled out with any degree of competence)

When all is striped away, the planning authority are the ones who have the most to answer for but of course they will never have to.

Kipperhell

SoupyNorman wrote: »

When all is striped away, the planning authority are the ones who have the most to answer for but of course they will never have to.

I think people here have a distorted view of what happens in this country. Corruption starts at the low level of somebody asking their local TD to do something for them. The TD does it and the people give him their vote. Basically that is corruption as we all know people who suddenly go up in a queue after subvention.

Now if 20 families start complaining about the planning they can't get and house prices the TD puts pressure on the planning people and when you have numerous TDs doing this you get bad ideas becoming bad realities. The planning authority is overridden by people power.

There really is only one way to sort this out and that starts with the people of Ireland to not to participate in corruption and put politicians that interfere with civil service into jail. I personally believe the government leave things in bad order so they can trade their fixing the problem for votes. When I go to a TD I want them to fix the problem with the system not fix my problem. I have met very few people who look past their own problems when going to a TD.

jmayo

SoupyNorman wrote: »

Just to make a point clear, I have nothing against the BMW region (I survived 4years of college in Athlone!).

The reason I focused on that area is because back at the end of the summer last year when things were ''going gimpy" the news and media used those areas in a kind of shock tactic way as they do.

The truth is it is country wide of course but it is also true to say that those areas have quite low levels of development, both in terms of industry and infrastructure (although it's getting better) which makes them less attractive places to live.

No worries, sometimes a bit paranoid what with a few easterners on here wanting everyone to move to cities
4 years in Athlone, I shall say nothing

You know one of the interesting things, one of the few councillors of any hue that complained about housing planning in small villages in Roscommon was the one they all treat as an eejit, yer man Ming the Merciless of legalise cannabis fame.
He actually objected to another housing estate being built in a local village, since the first one was already empty and actually of a poor build quality.
Did they listen, of course not.

smccarrick wrote: »

You could say the exact same about some areas of Dublin that have turned into monstrosities- look at Lucan- or Clonee for example- absolutely no thought whatsoever given to infrastructure,

....
The BMW areas were always a favourite with the media- because these were considered to be the 'less developed areas' of the country (and were the lions share of EU structural funds were focused). Much of the development there, while akin to elsewhere, was done solely for tax purposes without any thought given to actual purpose (other than tax shelters). As tax shelters- they were very useful- who wouldn't want to pay no tax- but as a means of providing needed accommodation- they were a disaster.
...

I thought Clonee was in Meath

Certain villages in Leitrim had huge estates built as tax right offs and they had no other value :rolleyes:
Dromod in Leitrim comes to mind as one example.

MG

The Pope's children being repeated at the moment on BBC4 at about 9pm. First epidose last night was hilarious. Full of brand new 06 BMWs (it was made in 2006) and builders crowing about easy money. The past, as they say, is a diferent country.

Second episode tonight for nostalgia fans.

In fairness to David he's clear about the warning signs that were there.

MG

MG wrote: »

The Pope's children being repeated at the moment on BBC4 at about 9pm. First epidose last night was hilarious. Full of brand new 06 BMWs (it was made in 2006) and builders crowing about easy money. The past, as they say, is a diferent country.

Second episode tonight for nostalgia fans.

In fairness to David he's clear about the warning signs that were there.

It actually makes you cringe seeing it now. Pity the BBC are showing it because it makes us look (and rightfully so) like some pack of fools.

osurdivol

I can see another 30% coming off max, there is no way they will fall 50%.

The_Conductor

osurdivol wrote: »

I can see another 30% coming off max, there is no way they will fall 50%.

On what basis do you make this assessment?
McWilliams guesstimate is purely hypothetical- but he does provide justification for what he is saying (even if a lot of people would disagree with him). On what basis are you suggesting a further 30% fall is in the offing, and that there is 'no way they will fall 50%'?

S.

partyguinness

I think McWillams is deliberately trying to shock people with figures and trying to bring about a change of attitude and debate.

He prob thinks they will drop about 20-30% but why not use 50% it is more dramatic.

Even this thread is a testament to his logic...just my guess.

spockety

smccarrick wrote: »

On what basis do you make this assessment?
McWilliams guesstimate is purely hypothetical- but he does provide justification for what he is saying (even if a lot of people would disagree with him). On what basis are you suggesting a further 30% fall is in the offing, and that there is 'no way they will fall 50%'?

S.

Ignore it.

I have never, ever, EVER seen someone who argues against the likelihood of various price drops back up their argument with any logical reasoning whatsoever.

You are wasting your breath.

SoupyNorman

spockety wrote: »

Ignore it.

I have never, ever, EVER seen someone who argues against the likelihood of various price drops back up their argument with any logical reasoning whatsoever.

You are wasting your breath.

You could have said similar in the mid 90's about price rises.

ntlbell

SoupyNorman wrote: »

You could have said similar in the mid 90's about price rises.

People who were predicting price rises usually had good reasoning as to why they would rise.

They're falling people have good reasoning as to why.

Now they're falling some people are saying a leveling out or even price rises are imminent with no reasoning...

slightly different.

SoupyNorman

ntlbell wrote: »

People who were predicting price rises usually had good reasoning as to why they would rise.

They're falling people have good reasoning as to why.

Now they're falling some people are saying a leveling out or even price rises are imminent with no reasoning...

slightly different.

Only slightly, and what I said was in 'slight' jest also.


Why so srs Accom and prop forum!

stevedublin

ntlbell wrote: »

People who were predicting price rises usually had good reasoning as to why they would rise.

They're falling people have good reasoning as to why.

Now they're falling some people are saying a leveling out or even price rises are imminent with no reasoning...

slightly different.

whats the reasoning as to why prices will fall then?
Ha?

SoupyNorman

stevedublin wrote: »

whats the reasoning as to why prices will fall then?
Ha?

Supply > Demand

The_Conductor

stevedublin wrote: »

whats the reasoning as to why prices will fall then?
Ha?

That would be:

1. Interest rates are at less that 1/4th what the ECB consider to be 'normal'.
2. Unemployment looks likely to hit 18-20%
3. People's NET income is tumbling
4. Taxes are rising (including a proposed property tax in December)
5. Financial institutions are not lending

- need I go on?

ntlbell

stevedublin wrote: »

whats the reasoning as to why prices will fall then?
Ha?

rising unemployment.
over all reduced income/higher taxes/levy's
credit crisis.
over supply

your still talking 8/9X's the avg ind wage to buy a shoe box

take your pick really.

whizzbang

smccarrick wrote: »

4. Taxes are rising (including a proposed property tax in December)

Really? Anything formally proposed or just rumour? I'm sure they are soarly tempted!