Am I mad to buy in 2012

eringobragh

Jesus can't believe what I'm hearing here - Is there a few EA's in thsi thread or people of the delussional kind?

Anyone buying into the current market and a 400k chain for that matter needs their head examined - as mentioned:

Madness: doing the same thing over and over again and expecting different results



The writing is on the wall :cool:

Marcanthony

oflahero wrote: »

Says the guy who claimed (on another thread) 'there is a constitutional right to housing', was challenged on it, quoted the Simon website on their 'aspirations regarding housing in the Constitution' as the actual Constitution, got called out on it, and then said 'oh it's there somewhere I can't find it on the web.'

God I should really stop reading Boards, it's such a horribly addictive waste of time...

In fairness to that post I did say it was an example. I could not find the original. However I could may have been incorrect. Which I will accept. However the relevance of the post was similar to this one and my point been people have to live somewhere as the living in a home industry is not going to end anytime soon.

A right to a home must have somekind of rights. As the social welfare will contribute to your housing needs if in difficulty or the councils will house taking into account your earnings (if any) If you dont see the valid point been stated. Thats your opinion.

Zamboni

Marcanthony wrote: »

if my theory does not sound right or the statistics I provided.Please provide your opinion on the cost of properties and protential loss in price or
go back to sleep.

Is English your first language?
I don't mean to be funny but I find it hard to understand some of your statements with your use of grammar and vocabulary.

You said

Marcanthony wrote: »

my theory is the fall from the peak price using a percentage fall each year starting from the peak price

So you are suggesting a correlation between peak prices and current property prices.
I asked you to explain that. You haven't.

But then you say

Marcanthony wrote: »

Also why is it commonly stated prices are down such a percentage from the boom.

Rather than prices are currently down such a percentage of what we think is the proper price.(pie in the sky)

Which, to be honest, I now find it increasingly difficult to understand anything you are posting.

Ray Palmer

daltonmd wrote: »

The CSO don't deal in theory, they use the information provided by the mortgage lenders - the banks. So they deal with actual sales prices.

I know they don't get accurate figure on HOUSE prices but mortgage values. There is no accurate figures hence the government are bringing in a system.

Marcanthony

I hope this sounds right for you zamboni and ill provide an example.

If the peak price of a property was 400k

and to date it is down 60% . I would take the opinion that the property is now worth 160k

and if its suggested property prices will fall by 10% next year from its current value. I would take that to be 16k. Leaving its value at 144k at the end of the year.

Now thats the theory. I am using as an example and no one can confirn if this is not the method used. It may not work for all properties as a realistic price.But is the best method I can come up with.

now in plain english. provide a method yourself or go back to sleep.

jmayo

strik wrote: »

I would say go with your feeling... a lot of the experts on here would have been in the same brigade that thought it was a great time to buy in 2007...... Markets will rise and fall and personally I feel by 2018 property prices will be back above 2007 levels.... many will argue against this but history tends to repeat itself and you are getting a property for probably less than 1/2 the price your neighbour paid........go for it and congrats on not getting screwed like most of us!

Can I have some of what your are using, it's sounds like a great hallucinogen

Marcanthony wrote: »

in fairness you make some good points and its probably not a neccessity to buy right now.

My point is that I dont think properties will fall much or if anymore below 60/70% of the boom and buying a property in the right location at these prices.Is giving you the pick of the crop at a genuinely good price.

I could give you 15+ reasons for your 5+.

However people stating its not the right time because they will drop further. Can they comfirm by how much and why they think this.property will not be given away.

You appear to have rightfully spotted we were in an unsustaineble credit fueled bubble (including noting the way banks and EAs thermselves were behaving) and you even got out on some of your investments at the right time, yet you make wild assessments now ?

Nobody can guarantee how much a particular property will fall.
As others have often said it depends on location, property type, property condition and the market for such a property.

But there are absolutelty no indicators to say that they will fall by exactly x percentage and there is no indicator to point to fact that prices should suddenly stop falling now.



I contunously view that bubble graph and I note that prices after a massive bubble normally go back to a level at a point before the bubble began.
Our house prices started increasing in mid to late 90s (stealth and awareness phases) and at the moment prices on average are about what 1999 or 2000 levels.
Look at the Blow Off phase and Dispair section of the graph.
We have not come out of that phase yet.
Our prices have not gone down truly to mid 1997/1998 levels and that is where I believe they may be headed.

Ray Palmer wrote: »

...
If you see your dream house and it isn't likely that you could or would do the same with another house then buy it for the right price.

Dangerous thing letting emotion rule such a decision.

Ray Palmer wrote: »

Yes theoretical saving are valid points but not always reflected accurtely as some areas are still not selling much property. There is a property or two that if they came on the market I might just really push for. A home is more than just about the price.

I think that statement is more true of land and that is why to a degree farm land can still reach high values, because a farmer will always be forced to buy in a certain area and there is very limited supply.

Ray Palmer wrote: »

You could suddenly lose your job or get sick but that is life and you can't plan for everything

For once I agree with ray_palmer in that you can't predict the future, but you can try and make decisions to try and make your future live as financially comfortable as possible.

daltonmd

@marc. My understanding is that they collect mortgage drawdowns from the lenders, they use last years data, location, house type and actual sales price to compare. You will not get A single property price because that's not allowed in this country but you will get a like for like comparison then they average it out by county and add it to the data from the peak to give a total house price average fall from peak. They do not give projections for future price falls, as far as I know anyway. There are those who do give projections, these projections are based on every other boom and bust cycle in the world. The higher property goes the further the falls.

Marcanthony

Ray Palmer wrote: »

I know they don't get accurate figure on HOUSE prices but mortgage values. There is no accurate figures hence the government are bringing in a system.

so have you any idea Ray on how this system will work.

Marcanthony

daltonmd wrote: »

@marc. My understanding is that they collect mortgage drawdowns from the lenders, they use last years data, location, house type and actual sales price to compare. You will not get A single property price because that's not allowed in this country but you will get a like for like comparison then they average it out by county and add it to the data from the peak to give a total house price average fall from peak. They do not give projections for future price falls, as far as I know anyway. There are those who do give projections, these projections are based on every other boom and bust cycle in the world. The higher property goes the further the falls.

well that is a logical explanation.But as Ray said still not able to confirm a price.

other than providing a percentage rate fall from the peak.

This is infairness is the point I was making.

daltonmd

Ray Palmer wrote: »

I know they don't get accurate figure on HOUSE prices but mortgage values. There is no accurate figures hence the government are bringing in a system.

The system is already in place. The legislation to make it available to the public is what is being brought in. The CSO gather all the information including the actual sales prices which is on the mortgage applications.

daltonmd

Marcanthony wrote: »

well that is a logical explanation.But as Ray said still not able to confirm a price.

other than providing a percentage rate fall from the peak.

This is infairness is the point I was making.

until we have a property price index much like the UK getting actual price data on a single property is not possible.

Marcanthony

jmayo wrote: »

You appear to have rightfully spotted we were in an unsustaineble credit fueled bubble (including noting the way banks and EAs thermselves were behaving) and you even got out on some of your investments at the right time, yet you make wild assessments now ?

Nobody can guarantee how much a particular property will fall.
As others have often said it depends on location, property type, property condition and the market for such a property.

But there are absolutelty no indicators to say that they will fall by exactly x percentage and there is no indicator to point to fact that prices should suddenly stop falling now.

.

You make good sense and appear to have a lot of knowledge in this field. So with an example I will ask your opinion.

A property bought in 1985 I can confirm was bought for £40k approx €50.

In 1994 its sale price was €90k.

At the peak of the boom was valued at €350k

Now deducting 70% from its peak. Would be a value of €105k.

This is bringing the property back to its value before the boom (almost, excluding inflation ect). This is where I am getting my theory from. Do you think they will fall below that value.

professore

endabob1 wrote: »

When I first bought (1997) the rule was 3 times your salary or in a joint application 3 times the main salary plus 1.5 times the second and I've stuck to that ever since. It's served me pretty well, al things considered.

This. To put in perspective I bought in 98 myself under these rules - actually 2.5 + 1. I was making 19K (punts) + bonuses and my wife was on 18K. We were approved for a mortgage of 67 K (92%) and bought a house for 72K. We had 1 child and had been renting before. It was enough at the time and still is. If I was paying even 20% more now we'd be seriously struggling - and we don't live lavishly. We go on a foreign holiday once every 2 years and drive a 5 year old car. However we do still have a bit of latitude, unlike people who bought houses later in the cycle.

I reckon the economy started going seriously out of kilter from about 2000 onwards. When we get back to 1995 living standards and prices things will begin to recover. We're nowhere near that yet.

professore

Marcanthony wrote: »

You make good sense and appear to have a lot of knowledge in this field. So with an example I will ask your opinion.

A property bought in 1985 I can confirm was bought for £40k approx €50.

In 1994 its sale price was €90k.

At the peak of the boom was valued at €350k

Now deducting 70% from its peak. Would be a value of €105k.

This is bringing the property back to its value before the boom (almost, excluding inflation ect). This is where I am getting my theory from. Do you think they will fall below that value.

Normally in a bust property values undershoot by 25% their pre-boom values before they start to recover. So I would say the house above could go as low as 67 K.

Just saw eringobragh's graph. I reckon we're just east of the return to "normal".

Spiritofthekop

professore wrote: »

This. To put in perspective I bought in 98 myself under these rules - actually 2.5 + 1. I was making 19K (punts) + bonuses and my wife was on 18K. We were approved for a mortgage of 67 K (92%) and bought a house for 72K. We had 1 child and had been renting before. It was enough at the time and still is. If I was paying even 20% more now we'd be seriously struggling - and we don't live lavishly. We go on a foreign holiday once every 2 years and drive a 5 year old car. However we do still have a bit of latitude, unlike people who bought houses later in the cycle.

I reckon the economy started going seriously out of kilter from about 2000 onwards. When we get back to 1995 living standards and prices things will begin to recover. We're nowhere near that yet.

100% correct.

Spiritofthekop

Marcanthony wrote: »

You make good sense and appear to have a lot of knowledge in this field. So with an example I will ask your opinion.

A property bought in 1985 I can confirm was bought for £40k approx €50.

In 1994 its sale price was €90k.

At the peak of the boom was valued at €350k

Now deducting 70% from its peak. Would be a value of €105k.

This is bringing the property back to its value before the boom (almost, excluding inflation ect). This is where I am getting my theory from. Do you think they will fall below that value.

Was that an apartment or a house?

Cause you would be doing well getting anything for €105,000 in an area thats not got anti-social problems.

We have a long way to go yet before we get to 1996/7/8 prices which they are heading towards.

Marcanthony

professore wrote: »

Normally in a bust property values undershoot by 25% their pre-boom values before they start to recover. So I would say the house above could go as low as 67 K.

Just saw eringobragh's graph. I reckon we're just east of the return to "normal".

That is good information you provided.

So I would like to ask you. To bear in mind the figures I stated and the dates provided.In relation to that property. Would you agree buying that now at the price I suggest is value now.

Would it be a good investment to buy now as a home without renting at present.

Victor

Can people lay off the sharp comments please?

Marcanthony

Spiritofthekop wrote: »

Was that an apartment or a house?

Cause you would be doing well getting anything for €105,000 in an area thats not got anti-social problems.

We have a long way to go yet before we get to 1996/7/8 prices which they are heading towards.

Thanks for confirming what I have been stating. No its not in an anti social area and its a house. But if it loses 70% of its peak price. Thats how much it will be worth.So what I have been saying is. if you can buy a property 60/70% from its peak.Its a good investment and probably the best time to buy. is now.

and you quoted earlier.

When you own a couple of houses like you do mate... I'm sure the advice of "its already bottomed out" is wishful thinking on your behalf.

professore

Eringobragh, I modified your graphic slightly ...

Spiritofthekop

Marcanthony wrote: »

Thanks for confirming what I have been stating. No its not in an anti social area and its a house. But if it loses 70% of its peak price. Thats how much it will be worth.So I have been saying if you can buy a property 60/70% from its peak.Its a good investment and probably the best time to buy is now.

Nope bad time to buy imo.

I dont care about investment properties. I'll happily live within my means & not over stretch and get greedy.

Prices are still way to high, way way way to high if I was looking to purchase a house in my part of Ireland but they are all coming down at a nice pace.

I expect maybe 2013/2014 I'll get value for money.

professore

The Irish property bubble from 2000 onwards will be in every economics textbook alongside the tulip mania in Holland and the South Sea company as a classic example of an enormous speculative bubble. Those years from 2000 - 2008 were a complete abberation, hopefully never to be repeated.

When it was possible for brickies straight out from the junior cert to make more in a day than some people made in a week the writing was on the wall.

daltonmd

It also needs to be said,again, that in the 90's particulary from 1996 we were entering a period of growth, prosperity, falling interest rates, falling unemployment, a rise in 2 income households, rising income, falling taxes, meaning a rise in disposable income and not forgetting the cheap and readily available credit. If a house sold for 90k in 1994 and quadrupled in value in 12 years then why, given everything that made this possible is now gone, should it not revert back to or near enough to lthe original price?

Marcanthony

Spiritofthekop wrote: »

Nope bad time to buy imo

Prices are still way to high, way way way to high if I was looking to purchase a house in my part of Ireland but they are all coming down at a nice pace.

I expect maybe 2013/2014 I'll get value for money.

my point was never about the rate that they where falling or in what area. My point was if you buy a property 60/70% under the peak price.its a good investment and probably best time to buy.I cant see them dropping any lower than that.

you state its a bad time to buy. But confirmed my last post.

Marcanthony

professore wrote: »

The Irish property bubble from 2000 onwards will be in every economics textbook alongside the tulip mania in Holland and the South Sea company as a classic example of an enormous speculative bubble. Those years from 2000 - 2008 were a complete abberation, hopefully never to be repeated.

When it was possible for brickies straight out from the junior cert to make more in a day than some people made in a week the writing was on the wall.

A brilliant point. I highlighted an issue in relation to that earlier. Using a doctor as an example.

Spiritofthekop

Marcanthony wrote: »

my point was never about the rate that they where falling or in what area. My point was if you buy a property 60/70% under the peak price.its a good investment and probably best time to buy.I cant see them dropping any lower than that.

you state its a bad time to buy. But confirmed my last post.

There is very little properties that are 60%/70%/80% down from peak price for sale im my part of the world but as i said they are coming down and down and down.

Anyway I would not use a fake property bubble peak price as an index into what a house is actually worth now.

Marcanthony

so to finalise on my behalf. I hope the originall op can decide if its the right time to buy now or not.

And the best of luck to him in whatever decision he makes to provide himself with a home.


During the boom I heard a lot of people saying and right up to the last minute.

Property prices double every seven years. (google and youll find that out)

and also know a lot of savvy investors.selling at the right time.

So my point been the decision is yours.

Marcanthony

Spiritofthekop wrote: »

There is very little properties that are 60%/70%/80% down from peak price for sale im my part of the world but as i said they are coming down and down and down.

Anyway I would not use a fake property bubble peak price as an index into what a house is actually worth now.

i never said 80% . i said 60/70 and yes they are available at present do your homework. I am in negotiations for one at present. good luck

Spiritofthekop

Marcanthony wrote: »

i never said 80% . i said 60/70 and yes they are available at present do your homework. I am in negotiations for one at present. good luck

Yup! goodluck with the big property portfolio. :rolleyes:

Marcanthony

professore wrote: »

Normally in a bust property values undershoot by 25% their pre-boom values before they start to recover. So I would say the house above could go as low as 67 K.

Just saw eringobragh's graph. I reckon we're just east of the return to "normal".

so thats a possible 81% from the peak price before it will start to recover, thanks for your opinion. I have been working on 70% as a max.