How to tell when the market is nearing the bottom!!! Easy

gurramok

wrightao wrote: »

Well actually, sorry to disappoint but a growing population is important for one reason, its human capital. More people to pay taxes, more people to spend, more affordable social entitlements unlike most of Europe which will be crushed by not having enough workers to pay for pensioners. On another note, Africa is not where it is because of a large and growing population but through other endemic issues. Anyway, who mentioned Africa.Yes, immigrants have been leaving but thats always the case with a boom and bust.

Very well, you need that human capital to have steady paying jobs to afford high priced houses in the first place to push prices back up and frankly, that ain't gonna happen for donkeys years to come.

It ain't all to do with bodies, you've gotta look at the earning potential of that human capital.

Senna

bobbysands81 wrote: »

Agreed mate...

but for a variety of reasons there is no way that the "average house price" will fall that far. Prices will remain falling for some time but an average house price will not drop as far as 119k.

I will wager any amount of money with anyone in relation to this.

Can you explain these reasons?? If you want a variety of reasons on why 119k will be reached (probably before 2015) then i will be happy to post them, or you could just read any other post on here.
Also, if we did have open information on selling prices, the current 250k would be very generous, even in a stalled market.

bobbiw wrote: »

But I assure you if and when properties drop to an 125 average, the average joe on 30k a year will not be getting one.

Then the price will continue to drop. There are 300k empty house in Ireland, those will have a bigger effect on house prices than any other factor.

bobbiw wrote: »

because for that to happen we need a bigger catastrophy like massive interest hikes, banks not lending and very high taxation.

Well 2 out of 3 at the moment and its early days.

bobbiw wrote: »

In the 80s you could get a nice house for 50k, not everyone had one because they couldnt afford it. Thats life!

Yep, just because it was easy to get a mortgage in the last 10 years does not mean thats the norm. But surprise surprise most people weren't living in cardboard boxes either in the 60/70/80's.

johnnyskeleton

wrightao wrote: »

Well actually, sorry to disappoint but a growing population is important for one reason, its human capital. More people to pay taxes, more people to spend, more affordable social entitlements unlike most of Europe which will be crushed by not having enough workers to pay for pensioners. On another note, Africa is not where it is because of a large and growing population but through other endemic issues. Anyway, who mentioned Africa.Yes, immigrants have been leaving but thats always the case with a boom and bust.

Arguably growing population = greater number of extra social welfare recipients to support.

In re house prices, the big unknown is inflation. If we're going to see stupid inflation soon, then now is a great time to buy. If not, it isn't.

bren2002

bobbiw wrote: »

Lots of people are thinking of buying and saying that they dont want to miss the bottom but that it is impossible to time or tell.

This is nonsense.

Its very easy to see how much house values will fall, you cant do it now but month by month you can.

House prices have fallen every month and will continue to do so for the next 3-5 years I guess. Am I right I cant tell now but I can tell month to month.

So if prices drop on average 1% a month that will be 12% a year or close to 50% by year 4. Although I do reakon that the price of drops will accellerate.

So when to buy,

Not when you like a house

Not when you can afford it.

Buy it when all economic indicators are showing that prices are stabalising. So when you see that houses are droping by .01% a month for 6 months there is a good chance you are at the bottom.

But its only a chance.

Seriously do you really want to buy something today for 400k to find it levels off at 200k and doesnt go back up to 400k ever.

Ireland if it ever does see the price of houses increase again will see it at the modest 3-4% a year that most cyclical economies do.

You need to revisit your maths there.

If (as you post) prices drop by 1% per month, then the 400,000 house drops to 151,674 after 48 months.

bren2002

And that average price of €250K drops to 94,796 after 4 years - never mind 5 or 6.

Senna

bren2002 wrote: »

You need to revisit your maths there.

If (as you post) prices drop by 1% per month, then the 400,000 house drops to 151,674 after 48 months.

That would be assuming 400k drops by 1% per month, rather than the house price dropping 1% per month. Each month is a new price and each month that new price drops by 1%, not 1% off 400k each time.

MrAbc

bren2002 wrote: »

You need to revisit your maths there.
If (as you post) prices drop by 1% per month, then the 400,000 house drops to 151,674 after 48 months.

Senna wrote: »

That would be assuming 400k drops by 1% per month, rather than the house price dropping 1% per month. Each month is a new price and each month that new price drops by 1%, not 1% off 400k each time.

Senna is right, the original calc was correct for -1%/month...
for example ... (0.99^48) x €400K ~= €247K

[but bren2002's version, in fact, uses a drop of 2%/month... (0.98^48)x400~=151.674]

bobbiw

sorry about the math??

I do feel sorry for people though.

craichoe

Jesus,

What happened to the days when people bought a house to live in the damn thing and not to turn a quick buck ?

Supercell

The inflation question is the biggie.
As pointed out above, if Ireland remains in the mire with low or negative inflation then house price are going to keep on falling as the economy is in bits.
However if we get inflations 80's style (and the jury is out on that) than maybe prices will take off again.
That said the Japanese crash was never effected by hyper global inflation and arguably we are a worse basket case than them.
Its conceivable we could have global hyper inflation and house prices here still continue to fall.

I cannot see any rational argument that leads to house prices rising here significantly in the next 5 years or so.
I think close to bottom we may have small falls and the occasional rise (like the UK last month) but the overall trend will still be down for years.. but the occasional rise is still a year or two away, we are nowhere near bottom yet -The apartment market has still a long way to implode..a looong way..(tiny sizes, almost zero sound proofing, crap quality..the list is endless)

warrenaldo

In the Budget in December - it is very likely that a property tax will be introduced.
If so, this may come hand in hand with stamp duty being abolished.

Does anyone reckon that this will stimulate people into buying - as there are a lot of people saving and waiting. This might be enough to make them go for it.

Just looking for peoples opinions. I think it could be a catalyst - hoping its not.

dianababyddori

i reckon we are gonna be at the very bottom by the end of this year.

No matter when u buy a house now or at the end of the year, the value of the house will be up in a couple of years when the economy gets better so its a win win situation anyway.

I Know alot of developers who had brand new property on the market that wasnt selling even though the price was dropped very low but now are renting them all out instead because its not worth dropping more in price because they would be selling them for less than what it cost them to build them.

So who knows if the prices will drop more.

I study real estate in colege and between sept 2007-2008 i did a project on 3different propertys, a apartment, a new energy rated house in a brand new development and a 2nd hand home.....

I did the same project on the 3same propertys in my 2nd year from sept 08 till now...

and they are all the same prices...
they never droped in price with the recession...

i think it really depends really and luck of the draw..

developers can afford to keep them by renting them and with morgages droping, rent covers the monthly costs.

dianababyddori

craichoe wrote: »

Jesus,

What happened to the days when people bought a house to live in the damn thing and not to turn a quick buck ?

yes i agree.... i think after the recession is over no1 will put there money into investment in houses... we live and learn from our mistakes...

whizzbang

dianababyddori wrote: »

i reckon we are gonna be at the very bottom by the end of this year.

No matter when u buy a house now or at the end of the year, the value of the house will be up in a couple of years when the economy gets better so its a win win situation anyway.

I Know alot of developers who had brand new property on the market that wasnt selling even though the price was dropped very low but now are renting them all out instead because its not worth dropping more in price because they would be selling them for less than what it cost them to build them.

So who knows if the prices will drop more.

I study real estate in colege and between sept 2007-2008 i did a project on 3different propertys, a apartment, a new energy rated house in a brand new development and a 2nd hand home.....

I did the same project on the 3same propertys in my 2nd year from sept 08 till now...

and they are all the same prices...
they never droped in price with the recession...

i think it really depends really and luck of the draw..

developers can afford to keep them by renting them and with morgages droping, rent covers the monthly costs.

It sounds like you are referring to the American Market (i.e. calling it "Real estate"). Do you think there is any chance that the prices peaked between Sept 07 and Sept 08, so in Sept 07 they were going up and Sept 08 they were going down? But in Sept both years they just happened to be equal? What about Sept 08 to now?

As far as I am aware Every state in the Us is showing property price drops now.

dianababyddori

whizzbang wrote: »

It sounds like you are referring to the American Market (i.e. calling it "Real estate"). Do you think there is any chance that the prices peaked between Sept 07 and Sept 08, so in Sept 07 they were going up and Sept 08 they were going down? But in Sept both years they just happened to be equal? What about Sept 08 to now?

As far as I am aware Every state in the Us is showing property price drops now.

Ohh no im talking bout ireland. for some reason my course is called real estate in business instead of autioneering dont know why..

yeah from my studys the propertys were all the same price between october 07 till march 09....not sure since
Dont know why the prices never droped

whats the property market like in america???
Do you think america and canada are gonna hit rock bottom like here in ireland?? were in depressing stage now or we still in the recession stage??
anyone know??

bangersandmash

dianababyddori wrote: »

I study real estate in colege and between sept 2007-2008 i did a project on 3different propertys, a apartment, a new energy rated house in a brand new development and a 2nd hand home.....

I did the same project on the 3same propertys in my 2nd year from sept 08 till now...

and they are all the same prices...
they never droped in price with the recession....

Maybe you'd elaborate on this. Do you mean the valuations that you arrived at on both occasions were the same? Or do you mean that these properties were still for sale at the same price?

dianababyddori

bangersandmash wrote: »

Maybe you'd elaborate on this. Do you mean the valuations that you arrived at on both occasions were the same? Or do you mean that these properties were still for sale at the same price?

No the sale prices were still the same... dont know why

do you think house prices have hit rock bottom yet???

bangersandmash

dianababyddori wrote: »

No the sale prices were still the same... dont know why

You were given access to actual sale prices that showed 3 cases of almost identical properties which had sold for exactly the same price in both October 07 and March 09? That's rather surprising.

oceanclub

warrenaldo wrote: »

Does anyone reckon that this will stimulate people into buying - as there are a lot of people saving and waiting. This might be enough to make them go for it.

No; the stamp duty thing has been a red herring now for years. FTBers and people buying small apartments are exempt from it, but this hasn't had any affect on those markets at all. The main thing preventing investers from buying property isn't stamp duty; it's the fact that any rental income can come nowhere near covering the mortgage.

P.

oceanclub

dianababyddori wrote: »

Ohh no im talking bout ireland. for some reason my course is called real estate in business instead of autioneering dont know why..

Which college/university? A google for "real estate in business" & "ireland" turns up 11 hits, none to do with courses.

P.

johnnyskeleton

dianababyddori wrote: »

No the sale prices were still the same... dont know why

do you think house prices have hit rock bottom yet???

As in you picked 3 random houses that were sold in 07 and those exact three same houses were sold again in 08 for the exact same prices?

dianababyddori

oceanclub wrote: »

Which college/university? A google for "real estate in business" & "ireland" turns up 11 hits, none to do with courses.

Course in athlone institute of technology.


P.

johnnyskeleton wrote: »

As in you picked 3 random houses that were sold in 07 and those exact three same houses were sold again in 08 for the exact same prices?

No they never were sold. like they have been on the market for sale since then but just saying that they never droped there prices but maybe they have in the last month or that. have'nt looked.

Hobky

Quote:
Originally Posted by Hobky
Bobbysands1 - Is the €119k referred to a real or nominal average house value?

If we're talking real numbers then I might well fancy a flutter here.

Please confirm time horizon (you're suggesting never - we'll need a definitive period), the odds on offer, the index base to be used (bear in mind the ESRI/PTSB HP Index may soon be discontinued) and the min/max bet you would consider.

I would consider putting 10k down.

Bobbysands1 - It's taken me a while but I've got 100 euro together.
Again please confirm time horizon, the odds on offer and the index base to be used.


Dianababydori - a siren will be sounded when the bottom is reached. About 8 years from now I'm guessing.

gurramok

dianababyddori wrote: »

No they never were sold. like they have been on the market for sale since then but just saying that they never droped there prices but maybe they have in the last month or that. have'nt looked.

Delusion.

IPW has listed thousands of properties that have had their prices dropped since '07 and yet you find 3 that have not and use it to proclaim 'the bottom is near':rolleyes:

Price drops across the board have been even acknowledged by estate agents themselves, yet you base your study on 3 properties, i think you have an agenda or just very naieve.

oceanclub

dianababyddori wrote: »

No they never were sold. like they have been on the market for sale since then but just saying that they never droped there prices but maybe they have in the last month or that. have'nt looked.

Sorry, Diana, are you saying that house prices aren't dropping because _three_ houses are still advertised at their original prices online? Sorry if I'm not understanding you.

P.

JoeyJJ

Those prices remain the same because the developer isn't under pressure to shift them and is living in a dream land.