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No living space in Dublin
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29-08-2011 2:18pm#1
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Acoustic Fanatic wrote: »..my point is that even if prices do fall, there will be a line of people waiting to buy, most of whom will earn more money than I do. This will drive the prices back up, and it will return to being a seller's market eventually.
That's the nature of supply and demand. A house is like a Mercedes, there is no absolute right for you to be able to own one.I think life spans do affect prices, as people living longer will mean there is a longer turnaround in the "life" of a physical house (from when it is initially bought, to when it will return to the market). This will mean that the number of houses required for Dublin will continue to increase, in line with population.
Good point - although where there is demand there usually is someone attempting to fill it.The government are staying uninvolved, as long as they can tax the hole off all parties, and the developers are holding off new projects until they can maximise their profit margins (once wages fall in the construction sector). The whole scenarion reminds me of the world oil situation. The producers set the prices, and we are left without a choice, which , ironically, is one of the cornerstone's of a capitalist market. If only America would invade...
America? The champion of self-centred capitalism?
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I want to make clear, that I'm multi-quoting comments by Acoustic Fanatic, and if I'm taking out of context, I apologise, but I don't think I am.Acoustic Fanatic wrote: »Anyone else get the feeling that ordinary people are being priced out of the property market? I dont feel that this is a deliberate effort, simply a by product of capitalism, where people with land try to make as much money from it as possible, which is only natural.
Prices are (on average) 42% off their height since during the boom - but surely the free market settles on a price that people are willing to pay. During the boom there was a lack of supply of housing, which was a result of demand which was fed by an over-supply of credit. This acted to drive up prices, as the banks were willing to give people more money, so they could bid against each-other for homes.
People selling homes would (naturally!) sell to the highest bidder, if lots of people want homes, and have lots of cash on loan, then that drives up the prices.Acoustic Fanatic wrote: »I do think, though, that my and my partner's salary wouldnt be enough to afford the house I grew up in (a 3 bed semi on the Northside).
I also think that by the time my kids (when I have them) grow up, they wont be able to afford to buy the house they grow up in.
So you're predicting a future house that you buy will grow in price/value. This is another problem of the boom. Many people bought small pokey apartments for crazy money thinking it'll be a means to get them on the property ladder. That ladder was the place many people were allured to, with the idea that their property would burst in value and they could then move up to a more expensive/valuable property when they sold their place.Acoustic Fanatic wrote: »I dont want to be tied down to a 30 mortgage, and be scrimping my whole life away. This must be a huige concern for people without jobs too. I sympathise with SOME of the people who rioted in England. It seems that most governments are only really concerned with how the budget balances, and not with social problems, like housing and crime.
So you don't want a loan to borrow money to make a purchase, yet you want to live in a house (not an apartment) in Dublin at a price that's below average. Ah here, I think this isn't very well thought out.Acoustic Fanatic wrote: »Honestly, I think I would prefer to work and save up loads of money, and move to some cheap country in South America, than spend my whole life lining someone else's pockets.
Wherever you live you'll probably be lining someone's pockets. That's if they want to sell/rent at a price that makes them some money above their margin. But lots of people in Ireland are in massive negative equity, that means the value of their property is below what their loan for the property is. But this is likely the same for many rental properties, when people are taking in less rental income than the cost of servicing a buy-to-let mortgage on the property. Buy-To-Lets were majorly promoted during that aul boom too.Acoustic Fanatic wrote: »but my point is that even if prices do fall, there will be a line of people waiting to buy, most of whom will earn more money than I do. This will drive the prices back up, and it will return to being a seller's market eventually.
If there's a "line" of people will to buy then prices will rise. A "line of people" suggests there's demand. And basic economic theory says that demand exceeding supply means price will increase. Unless there's LOTS of supply. And HEY! we've lots of that. So if prices do go up, it's because the market cannot accommodate demand at the lower price; because people are encouraged to buy - which is a major thing NAMA wants to do, by the way.Acoustic Fanatic wrote: »I think life spans do affect prices, as people living longer will mean there is a longer turnaround in the "life" of a physical house (from when it is initially bought, to when it will return to the market). This will mean that the number of houses required for Dublin will continue to increase, in line with population.
If people are living longer, does it not suggest their loan-term could be a little bit longer too?Acoustic Fanatic wrote: »The government are staying uninvolved, as long as they can tax the hole off all parties, and the developers are holding off new projects until they can maximise their profit margins (once wages fall in the construction sector). The whole scenarion reminds me of the world oil situation. The producers set the prices, and we are left without a choice, which , ironically, is one of the cornerstone's of a capitalist market. If only America would invade...
First, let's look at oil. There's a cartel to control the supply in order to set the price, this cartel from time to time responds to demand by adjusting the supply in a somewhat high level of confidence of what the price will be. It's essentially a oligopoly, but really a monopoly where OPEC is concerned.
Now, let's visit (briefly!) the point of the Gov being uninvolved. You say you don't know what you want them to do but say they should do something and that they're currently doing nothing. Ok, well yes, previous administrations absolutely minted it on stamp duty on homes, alongside encouraging home ownership by giving incentives to first time buyers. Ceding control of the exchange rate and interest rate didn't help it should be pointed out. Developers aren't holding off at the moment because they want to "maximise profit" - many of them have gone out of business because they were over leveraged during the boom and their debts now exceed their income, because (newsflash) people aren't buying houses at the prices they previous did. There are a handful of developers who are refusing point blank to drop their prices. Others have given in to the banks and creditors.Acoustic Fanatic wrote: »Hmm, yeah, but I think we can all agree that a home is not a luzury. I dont expect a mansion, but I dont want to raise kids in an apartment.
So you have specific demands, as others do too, this means that if others want the exact same property as you do there will be price competition.Acoustic Fanatic wrote: »I agree, but the simple model of supply and demand cant be applied to property, as it is also a resource. As such, this resource is becoming unaccessible in Dublin to people earning normal/modest wages. Essentially, land hoarding, which is not a new phenomenon.
Resources ARE subject to supply and demand. This is a comment where I don't think you understand what you're talking about.
:rolleyes:Acoustic Fanatic wrote: »Haha, it would help the economy by exporting terror.Acoustic Fanatic wrote: »Rent - As expensive as buying
There's a bigger argument here, you don't want to have a 30 year mortgage, so a mortgage you would be paying would be MUCH more than rental yield. But in the current market I'm aware of many landlords who are actually subsiding their buy-to-let mortages from their own wages because the market won't pay a price they want.Acoustic Fanatic wrote: »Social housing - Do you think there would be more or less competition for social housing than normal housing?Acoustic Fanatic wrote: »Live with Mammy - That's what I am doing. Not exactly cool when you're 25.
So is this argument a social one then, or what? Sorry, you just don't want to live with mammy?Acoustic Fanatic wrote: »Inherit - I will inherit debt, most likely
This is impossible, you cannot currently inherit someone else's debt. If someone dies it dies with them, or at least their debts are the problem for their estate. If your parents (say) have a home with a mortgage they may have insurance that writes off the debt. If not, then the bank will have a mark on the debts first. That's only fair.
Also - anyone who's relying on their parents to bail them out after their death is an idiot. You yourself said earlier that people are living longer - you should check out Ray Kurzweil's writing, he thinks people could become immortal within 30 years. The idea that anyone would hope their folks die in order to inherit (not death) is something none of us need talk about.Acoustic Fanatic wrote: »Dont get me wrong, I do know that prices are dropping. But I dont think they will drop to the level where they will be affordable for most people.
They've never been affordable for most people. Most people have to get mortgages. But yes, property (imho) has been too expensive and thus they are coming down. Whether they'll come down to a price you're willing to afford (or are willing to pay) are based on whether there's competition for property.Acoustic Fanatic wrote: »Apartments will be made affordable, but I dont see that for houses.
With the greatest of respect, beggers cannot be choosers. Those who want to buy a house will out-bid others if they can afford it. That's the economic market. The excellent people who keep this Boards.ie house in order also run Daft.ie - right now the cheapest house (that appears to not be derelict) is Dublin is a place in Fairview at just under €78,000, the most expensive is €8,000,000 - from 6183 properties for sale, there's a lot of choice. But everyone has to compromise, be it on location, size or price.Acoustic Fanatic wrote: »I dont know what the government can do. I know that it is only them who can make a change.
This makes little change. You don't like the market, you want the Gov to do something. Have you acknowledged anything the government (and I don't mean political govs) have done? What about the affordable housing scheme? I know lots of people who've been able to buy homes on that basis.Acoustic Fanatic wrote: »Property developers and banks will just do as they always have. I do think that the de-centralisation initiative a few years ago was a good idea, but they never followed through. That would have sorted out house prices, I think, by adding competition. Making different "hub" towns/cities would make sense. I wouldnt really want to move away from my family, but it would beat moving abroad.
Aye, you are right here, the FF/PD decrentralisation scheme was ridiculous, poorly executed and badly implemented. If I had bought a home thinking the Gov was moving a dept there and didn't I'd have sought legal advice over being misled by the state into a commercial transaction. But I'm no lawyer. Yet.
[QUOTE=Acoustic Fanatic;74094758 But two people working should be able to afford a house, and not have to pay for it over thirty years. I dont think thats unreasonable. For a country with a low population and high emigration, there is very little incentive to get married and have children.[/QUOTE]
There is a difference between being able to afford a place to live anywhere in Ireland as opposed to "a house" in Dublin, which probably includes a garden etc. Houses (as opposed to apartments) tend to have a higher demand than apartments do outside of booms, as the people who are in the market are less likely to be speculators/ medium-term lettors and more likely people who want to buy a long-term property. What that tends to mean is that people will pay a bit more to live in a house. Again, this is a competing economic market, there are other people who want to live in a house, and who will pay more than you, and thus the price paid is higher.0 -
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DavidCochrane wrote: »I want to make clear, that I'm multi-quoting comments by Acoustic Fanatic, and if I'm taking out of context, I apologise, but I don't think I am.
Prices are (on average) 42% off their height since during the boom - but surely the free market settles on a price that people are willing to pay. During the boom there was a lack of supply of housing, which was a result of demand which was fed by an over-supply of credit. This acted to drive up prices, as the banks were willing to give people more money, so they could bid against each-other for homes.
People selling homes would (naturally!) sell to the highest bidder, if lots of people want homes, and have lots of cash on loan, then that drives up the prices.
So you're predicting a future house that you buy will grow in price/value. This is another problem of the boom. Many people bought small pokey apartments for crazy money thinking it'll be a means to get them on the property ladder. That ladder was the place many people were allured to, with the idea that their property would burst in value and they could then move up to a more expensive/valuable property when they sold their place.
So you don't want a loan to borrow money to make a purchase, yet you want to live in a house (not an apartment) in Dublin at a price that's below average. Ah here, I think this isn't very well thought out.
Wherever you live you'll probably be lining someone's pockets. That's if they want to sell/rent at a price that makes them some money above their margin. But lots of people in Ireland are in massive negative equity, that means the value of their property is below what their loan for the property is. But this is likely the same for many rental properties, when people are taking in less rental income than the cost of servicing a buy-to-let mortgage on the property. Buy-To-Lets were majorly promoted during that aul boom too.
If there's a "line" of people will to buy then prices will rise. A "line of people" suggests there's demand. And basic economic theory says that demand exceeding supply means price will increase. Unless there's LOTS of supply. And HEY! we've lots of that. So if prices do go up, it's because the market cannot accommodate demand at the lower price; because people are encouraged to buy - which is a major thing NAMA wants to do, by the way.
If people are living longer, does it not suggest their loan-term could be a little bit longer too?
First, let's look at oil. There's a cartel to control the supply in order to set the price, this cartel from time to time responds to demand by adjusting the supply in a somewhat high level of confidence of what the price will be. It's essentially a oligopoly, but really a monopoly where OPEC is concerned.
Now, let's visit (briefly!) the point of the Gov being uninvolved. You say you don't know what you want them to do but say they should do something and that they're currently doing nothing. Ok, well yes, previous administrations absolutely minted it on stamp duty on homes, alongside encouraging home ownership by giving incentives to first time buyers. Ceding control of the exchange rate and interest rate didn't help it should be pointed out. Developers aren't holding off at the moment because they want to "maximise profit" - many of them have gone out of business because they were over leveraged during the boom and their debts now exceed their income, because (newsflash) people aren't buying houses at the prices they previous did. There are a handful of developers who are refusing point blank to drop their prices. Others have given in to the banks and creditors.
So you have specific demands, as others do too, this means that if others want the exact same property as you do there will be price competition.
Resources ARE subject to supply and demand. This is a comment where I don't think you understand what you're talking about.
:rolleyes:
There's a bigger argument here, you don't want to have a 30 year mortgage, so a mortgage you would be paying would be MUCH more than rental yield. But in the current market I'm aware of many landlords who are actually subsiding their buy-to-let mortages from their own wages because the market won't pay a price they want.
So is this argument a social one then, or what? Sorry, you just don't want to live with mammy?
This is impossible, you cannot currently inherit someone else's debt. If someone dies it dies with them, or at least their debts are the problem for their estate. If your parents (say) have a home with a mortgage they may have insurance that writes off the debt. If not, then the bank will have a mark on the debts first. That's only fair.
Also - anyone who's relying on their parents to bail them out after their death is an idiot. You yourself said earlier that people are living longer - you should check out Ray Kurzweil's writing, he thinks people could become immortal within 30 years. The idea that anyone would hope their folks die in order to inherit (not death) is something none of us need talk about.
They've never been affordable for most people. Most people have to get mortgages. But yes, property (imho) has been too expensive and thus they are coming down. Whether they'll come down to a price you're willing to afford (or are willing to pay) are based on whether there's competition for property.
With the greatest of respect, beggers cannot be choosers. Those who want to buy a house will out-bid others if they can afford it. That's the economic market. The excellent people who keep this Boards.ie house in order also run Daft.ie - right now the cheapest house (that appears to not be derelict) is Dublin is a place in Fairview at just under €78,000, the most expensive is €8,000,000 - from 6183 properties for sale, there's a lot of choice. But everyone has to compromise, be it on location, size or price.
This makes little change. You don't like the market, you want the Gov to do something. Have you acknowledged anything the government (and I don't mean political govs) have done? What about the affordable housing scheme? I know lots of people who've been able to buy homes on that basis.
Aye, you are right here, the FF/PD decrentralisation scheme was ridiculous, poorly executed and badly implemented. If I had bought a home thinking the Gov was moving a dept there and didn't I'd have sought legal advice over being misled by the state into a commercial transaction. But I'm no lawyer. Yet.
There is a difference between being able to afford a place to live anywhere in Ireland as opposed to "a house" in Dublin, which probably includes a garden etc. Houses (as opposed to apartments) tend to have a higher demand than apartments do outside of booms, as the people who are in the market are less likely to be speculators/ medium-term lettors and more likely people who want to buy a long-term property. What that tends to mean is that people will pay a bit more to live in a house. Again, this is a competing economic market, there are other people who want to live in a house, and who will pay more than you, and thus the price paid is higher.
I take your points. Maybe it is just my idealistic, socialist ideas that clash with everyone else's. I fear that the current system is promoting disparity between the rich and the poor. I think that we are moving towards a more unequal society, similar to America's. In promoting the sole pursuit of money, we will cripple ourselves.
But hey, thats just my opinion.
People's reactions to this post have shown me a lot.0 -
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