Houses in danger from NAMA!

Kipperhell

beeno67 wrote: »

I think you are getting confused here. We are not talking about a farmer selling a few bits of land off for sites. If a developer has say 100 million worth of sites. The question is what is the potential to develop the sites. This does not mean can they be built on but what property on the sites can be sold for. They may not even be zoned never mind have planning permission at the present

I think you have confused what I am saying. The suggestion is that property with planning permission is worth no more than agricultural land. I disagree and the market disagrees. The potential to develop does not have to be realised immediately, it is very short sighted to look at the present market and say property with planning is worth no more than land without planning.

Houses with big side gardens have always sold for more because of potential which even in a falling market remains the cases and the same applies to land with planning.

Senna

Kipperhell wrote: »

What is the argument for it not increasing the value of the land? Land you can build on is worth more than land you can't. To me it would make sense to use normal valuation terms so I don't see how it is common sense to value property by other means.

In my example, the land has now got planning for 600 houses, but it my as well have planning for a million bedroom hotel, as there is about as much need for both in this rural area.
The zoning of the land should be all thats relevant to the valuation of a field. The need for housing in that particular area, can be assessed also (Little point in our current mass over supply) , but the fact that planning has been sough and granted should have no bearings if there is no need for what has been planned for.

Kipperhell wrote: »

Time and effort are involved in getting planning and you don't instantly get it.

If the increase in price due to the planning was a reflection for the costs involved with planning, then that would be acceptable. But what would that be? €40k more for a 6 acre site? maybe €10k more per acre? I would bet the valuations wont work like that.

Kipperhell

Senna wrote: »

In my example, the land has now got planning for 600 houses, but it my as well have planning for a million bedroom hotel, as there is about as much need for both in this rural area.
The zoning of the land should be all thats relevant to the valuation of a field. The need for housing in that particular area, can be assessed also (Little point in our current mass over supply) , but the fact that planning has been sough and granted should have no bearings if there is no need for what has been planned for.

Planning is more relevant than zoning. Part of the planning is meant to consider need. Current demand for housing will effect the price but it does not remove the fact the land with planning is worth more. You are only looking at it from the current market view point if a property has planning you can change the planning. The fact the local planning will allow construction of any type is worth money. You can not "should" the world around you as it has it's own nature that you are better understanding than fighting.

Senna wrote: »

If the increase in price due to the planning was a reflection for the costs involved with planning, then that would be acceptable. But what would that be? €40k more for a 6 acre site? maybe €10k more per acre? I would bet the valuations wont work like that.

Because that is how every market works?:rolleyes: You can think what you like but you aren't looking at this from a realistic point of view. It seems like you have no idea how normal valuation works or what has value. The valuation should consider all factors and planning permission and need of such planning is considered. Getting planing is a lot more than simple cost and doesn't really have a straight forward effort involved to price ratio as location, location, location still remain the three important factors.

Planning increases the value of property how much will depend on location but it will rarely be a zero increase. Given the choice between two identical field one with planning most will go for the land with planning which means more demand for that land meaning higher price.

Senna

Kipperhell wrote: »

Planning is more relevant than zoning. Part of the planning is meant to consider need.

Meant too, yes. But as i have stated above, planning is being sough and granted before NAMA arrives for houses that wont be required by any market for at least 20 years (and we would need another bubble in 10 years for it to be needed here).
Planning means diddly squat in an over supplied market, raising the prices that will eventually fall on the back of tax payers.

I'll refer to my previous post, if a site has planning for a huge hotel in a town with current room occupancy of 30%, is that site worth more than the field beside it with no planning?
But i suppose houses are different:rolleyes: There must be "a current need" for planning to increase the value. If there is none currently, then planning is worthless.

Kipperhell

Senna wrote: »

If there is none currently, then planning is worthless.

That is your opinion and in no way illustrated in the market. As I would be looking at the market as opposed to how you feel it should work I'll go with reality. I would simply like to say you are incorrect in your many assumptions and don't seem to see what is reality and what is your opinion.

You can call my view an opinion if you want but reality shows it to be fact.

Patrickof

Kipperhell wrote: »

That is your opinion and in no way illustrated in the market. As I would be looking at the market as opposed to how you feel it should work I'll go with reality. I would simply like to say you are incorrect in your many assumptions and don't seem to see what is reality and what is your opinion.

You can call my view an opinion if you want but reality shows it to be fact.

Please give some examples of where your position is evidenced by the market?

Current reality is that planning premium is worth a maximum of what it cost to get that planning. There's no magic in it, anyone can apply for planning so it's not something special that a handful of folk "have a knack for". Anyone can get a good architect etc and apply, therefore it's premium value is rather minimal.

Zoning, however, is another story - although in the current market its not so clear either.

Senna

Kipperhell wrote: »

That is your opinion and in no way illustrated in the market. As I would be looking at the market as opposed to how you feel it should work I'll go with reality. I would simply like to say you are incorrect in your many assumptions and don't seem to see what is reality and what is your opinion.

You can call my view an opinion if you want but reality shows it to be fact.

Do you Kipperhell think that a site in Bally-arse-knowhere which HAS planning for 600 house, that will NEVER be required, is worth any more than the identical field next door?

You have to realise that planning in itself means nothing if the planning's for a development thats not required by the market.

Kipperhell

Senna wrote: »

Do you Kipperhell think that a site in Bally-arse-knowhere which HAS planning for 600 house, that will NEVER be required, is worth any more than the identical field next door?

I clearly stated yes already and refute your opinion of "NEVER"

Senna wrote: »

You have to realise that planning in itself means nothing if the planning's for a development thats not required by the market.

That is your opinion not seen in reality. If you can give an example of such a place where planning has no effect on the property you can be proven right in that one case. I doubt you can even show one example. The market you are referring to is only the present market and you can't seem to grasp the idea of potential future markets.