House prices still falling?

Ritchi

gurramok wrote: »

Where did you get that 50,000 figure from? And are they mortgage ready as in steady jobs, earning enough and no debts?
By the way, I am one and I may buy this year or not, it depends on what I see value. Not there yet but its getting closer very very slowly.

I can't remember where I read it, it could be way off. I'll try find a link for you now.

But to me it sounds like it could be about right, I know a lot of people waiting to buy, myself included. Lots of people who who were ready to buy in 2008 and got lucky, and the others that have built the deposit in the past few years. There are also the people that have left the country to get jobs, with the intention of coming back when they can again get jobs and afford a house. They may not be able to get jobs now(unless they are in certain industries like IT or funds) but they can certainly afford houses.

It is getting close to value in my opinion, and in some cases there is value, it may well go even lower(everything currently says that they will), but will the right houses be available when they go even lower, and will they be easy to pick up? I'm not so sure.

Zamboni

Even if there was 50,000 people wanting to buy, some cash buyers and a high proportion were mortgage ready with deposits, what is the likeliehood of the banks issuing 30 or 40 thousand mortgages?
They are still trying to build up their deposit base themselves.

jmayo

pawnacide wrote: »

House prices in general will level off and at a level higher than most people think .. simply because the huge over supply will be sold to developers who need to make a profit and while their costs have lowered there is a level where it stops making sense.There will of course be a few properties sold below these values by desperate sellers, banks etc but they will not be the norm. Of course there will always be those who will quote these exceptional sales as the true market values but what good is that if you can't actually buy what you want at those values.

There is one little fly in this theory.
If someone, be they developer/investor, buys a block of finished/nearly finished apartments or stanch of houses, then they either rent them out or sell them on.
Either way it has a knock on affect on the rest of the market.

If they rent them out they are eating into the rental market where a lot of buy to letters and mini landlords are struggling to survive.
If these group can't continue then their properties hit the market.
See statement by Central Bank regarding this group.

If they chose to sell on the developments they have snapped up then they are adding more properties onto the market.

Also the appetite amongst Irish peope for buying partments I think has taken a tumble.
They were seen as a starter property but people are now way more wary of getting caught in a property they do not want long term.

Ritchi wrote: »

I can't remember where I read it, it could be way off. I'll try find a link for you now.

But to me it sounds like it could be about right, I know a lot of people waiting to buy, myself included. Lots of people who who were ready to buy in 2008 and got lucky, and the others that have built the deposit in the past few years.

There are also the people that have left the country to get jobs, with the intention of coming back when they can again get jobs and afford a house.

Forget that bunch.
Look at Ireland's history and you find that most of the ones that emigrated rarely return and if they do it can be 10/20 years later.
I can only recall two times where people were returning in any number and that was late 70s and late 90s and the 2000s up to 2007.
With the way our economy has gone and the way things are shaping up most of the ones who have left will never come back.

Ritchi wrote: »

They may not be able to get jobs now(unless they are in certain industries like IT or funds) but they can certainly afford houses.

What ???
Are you saying that people who have emigrated to another country are going to buy property back in Ireland on the off chance they are going to return some day ?
Sounds like lunacy or someone with loads of cash to burn.
Why not buy a home where you are actually living ?

Ritchi wrote: »

It is getting close to value in my opinion, and in some cases there is value, it may well go even lower(everything currently says that they will), but will the right houses be available when they go even lower, and will they be easy to pick up? I'm not so sure.

There are always particular things that buck the trend to a degree.
It is a bit like the sale of farmland, which will hold it's value better since it is in higher demand due to location.
But all property has and will drop to some degree.

desertcircus

pawnacide wrote: »

desertcircus wrote: »

There's no shprtage of places developers will have to sell at a loss, or places the receivers will sell at a loss. Unfinished places will go for peanuts: there's an entire apartment block in Killiney going for just over three million. Someone, somewhere along the line, is going to eat the loss on an unsold place, and every one that's sold increases the pressure in a market with far more sellers than buyers.

You really should read back a few posts before going to the trouble of replying.

I did, and I couldn't see the basis of your argument. Claiming that prices won't fall further because developers won't sell at those prices is an argument that could have been made at any point in the last four years, and I see no reason for it to stop being wrong. Prices will fall until supply meets demand - the point at which the number of houses for sale is about met by the number of mortgages in a given year. We're oversubscribed by a factor of about six at the moment, and will remain so until either prices fall still further or banks radically loosen their lending criteria - and the second one will simply not happen.

Ritchi

jmayo wrote: »

What ???
Are you saying that people who have emigrated to another country are going to buy property back in Ireland on the off chance they are going to return some day ?
Sounds like lunacy or someone with loads of cash to burn.
Why not buy a home where you are actually living ?

No, I'm not. I'm saying a lot of people have left unwillingly, and will return should they get a job and can afford a house. They most likely can afford a house now, and if they can get a job here, they will probably buy a house too.

Kaner2004

Im not really concerned about the short term prospects from here.
I can get the yields I require now. Thats all Im concerned with.
If I do my homework and cover myself now, i dont think i'll go too far wrong. Although in theory could get it spectacularly wrong, I'm a careful investor. Always have been and see no reason to change. Im not a risk taker at all.

Im quite happy about the position at the moment. I havent been since 2004.

I know a lot of people like me, and even more with a higher risk tolerance than myself, who will probably buy tens of apartments or houses over the next year or two.

The general feeling is that its time to start making moves and get in before anyone notices, because when they notice, then you'll see increased demand and pickings will be slimmer.

Ritchi

Zamboni wrote: »

Even if there was 50,000 people wanting to buy, some cash buyers and a high proportion were mortgage ready with deposits, what is the likeliehood of the banks issuing 30 or 40 thousand mortgages?
They are still trying to build up their deposit base themselves.

I honestly have no idea. I've been into banks, and although they are stricter, and are offering less, they(well, AIB and BOI) seem quiet happy to lend if you can pass their stress tests.

It all depends on how many people are in a good position (like I am lucky enough to be in).

Obviously a lot of what I'm saying is guess work. And just to reiterate, I do think, in general, house prices will continue to drop, and that they are very unlikely to rise much if at all in the next few years. But I do think certain prime areas will have a lack of houses for people wanting to buy, and hence will have some sort of bounce back in prices at some stage.

People that are looking now have raised standards of what they want, and there is a lack of these houses to suit that need, and that will increase over time.

Houses/appartments in non prime locations, and ones that are badly built will continue to drop in the long term, in my opinion.

grumpymunster

I guess a lot is location as well. Is a lot of the NAMA property near population centres or in the middle of no where? Or apartments where people seem to want houses now (press on apartments of late not been great at all).

There is also a school of thought that in a European context our property is now undervalued.

So all in all God knows and maybe even he is guessing.

Spiritofthekop

Kaner2004 wrote: »

Im not really concerned about the short term prospects from here.
I can get the yields I require now. Thats all Im concerned with.
If I do my homework and cover myself now, i dont think i'll go too far wrong. Although in theory could get it spectacularly wrong, I'm a careful investor. Always have been and see no reason to change. Im not a risk taker at all.

Im quite happy about the position at the moment. I havent been since 2004.

I know a lot of people like me, and even more with a higher risk tolerance than myself, who will probably buy tens of apartments or houses over the next year or two.

The general feeling is that its time to start making moves and get in before anyone notices, because when they notice, then you'll see increased demand and pickings will be slimmer.

There will always be buying and selling of properties. Always. You just wont see anything like the fake boom again for a long long long time. Most people after seeing whats happened to in some cases very unfortunate other people.... will now only pay what they can afford these days & only buy value for money as property imo is still way over priced when you compare to pre fake bubble prices. House prices will still continue to fall for the next few years imo.

Zamboni

grumpymunster wrote: »

There is also a school of thought that in a European context our property is now undervalued.

What is this school of thought you speak of?

Kaner2004

Spiritofthekop wrote: »

There will always be buying and selling of properties. Always. You just wont see anything like the fake boom for a long long long time. Most people will only pay what they can afford these days, as property imo is still way over priced when you compare to pre fake bubble prices. House prices will still continue to fall for the next few years imo.

I know what you are saying. I heard it before. Pity there was no internet in the 80's. Then we could have a record of what the general man in the street (now man on the net) was saying. You would find its exactly the same as now. Things just seem to have a way of working themselves out over time. Then unravelling again. Then rinse and repeat.

But, just like your opinion, my opinion isnt worth a damn either. All that either of us has said about our predictions is no different than what is always said in a recession.

But as I said. If I can get the yields I require, I really dont care where the prices go in the next few years, within reason of course. So even if im wrong about where prices will go, and the only thing I think im certain of is that in 10 years prices will be above what they are now an the current recession will be long forgotten. There will be another recession though as sure as night follows day. I want to be positioned correctly for that too.

Balmed Out

People forget that different parts of the country have very different conditions with I think the general rule being the more transactions the more realistic prices are. There are plenty of areas where very little property has been sold over the last few years as vendors have not been as yet forced to sell and potential purchasers refuse to meet ridiculous bubble prices.

Im confident that prices have further to fall but id add that until we know whats going to happen to defaulting mortgages etc its hard to guess how more they will fall.

Spiritofthekop

grumpymunster wrote: »

I guess a lot is location as well. Is a lot of the NAMA property near population centres or in the middle of no where? Or apartments where people seem to want houses now (press on apartments of late not been great at all).

There is also a school of thought that in a European context our property is now undervalued.

So all in all God knows and maybe even he is guessing.

What when you compare prices to other major cities in the world. Have you seen what you can buy for 500,000 in other sunny beautiful countries/cities? It would make you cry when compare the utter crap over priced properties people are asking for in this little dysfunctional island.

Its astonishing to me how over-valued this country is as far as property goes mate!

Kaner2004

Spiritofthekop wrote: »

What when you compare prices to other major cities in the world. Have you seen what you can buy for 500,000 in other sunny beautiful countries/cities? It would make you cry when compare the utter crap over priced properties people are asking for in this little dysfunctional island.

Its astonishing to me how over-valued this country is as far as property goes mate!

Property is over-valued now because there is no market.
Strictly speaking, it should actually be worth nothing until the market starts up.
But when there is a market, than what you get is the market price. Is doesnt matter whether you think its over or undervalued at all. It is valued at the price it is selling at.

Comparing to other countries is as pointless as comparing your taxes, wages or your sun tan to another country. If it really was better there for you than here, then you would be living there and not looking over the fence wishing on it.

Spiritofthekop

Kaner2004 wrote: »

Property is over-valued now because there is no market.
Strictly speaking, it should actually be worth nothing until the market starts up.
But when there is a market, than what you get is the market price. Is doesnt matter whether you think its over or undervalued at all. It is valued at the price it is selling at.

Comparing to other countries is as pointless as comparing your taxes, wages or your sun tan to another country. If it really was better there for you than here, then you would be living there and not looking over the fence wishing on it.

Unfortunately some people have to stay close to home for family reasons that are out of your control.

I would be gone in a heartbeat otherwise.

Kaner2004

Spiritofthekop wrote: »

Unfortunately some people have to stay close to home for family reasons that are out of your control.

I would be gone in a heartbeat otherwise.

But there are about 4 million of us that after weighing up all the pros and cons, still remain in Ireland, even if we like to pretend that we would prefer to be somewhere else.
I like the Bahamas myself, but at the end of the day I still live in Ireland. The grass is always greener until you are looking back at the grass you left. Human nature.

Zamboni

Ritchi wrote: »

I honestly have no idea. I've been into banks, and although they are stricter, and are offering less, they(well, AIB and BOI) seem quiet happy to lend if you can pass their stress tests.

It all depends on how many people are in a good position (like I am lucky enough to be in).

http://www.rte.ie/news/2012/0323/economy-business.html

Using its current forecast for unemployment and house prices, the bank projects that the 90-day owner-occupier mortgages arrears rate will rise to just above 10% this year from 9.2% at the end of 2011.

It adds that the banks, already planning thousands of job cuts, will have to cut more costs, that they face further eroding of margins due to the high cost of funding and will have difficulty significantly increasing deposit volumes given the weak economy.

"Banks face the challenge of generating recurring earnings in an environment of limited ability to re-price tight loan margins and funding cost pressures," the report says.

AIB cutting back on its free banking is only the start.
Interest rates are going to be come punititive on home loans.
Personally, I think anybody buying now with a mortgage is absolutely bonkers.

pawnacide

desertcircus wrote: »

I did, and I couldn't see the basis of your argument. Claiming that prices won't fall further because developers won't sell at those prices is an argument that could have been made at any point in the last four years, and I see no reason for it to stop being wrong. Prices will fall until supply meets demand - the point at which the number of houses for sale is about met by the number of mortgages in a given year. We're oversubscribed by a factor of about six at the moment, and will remain so until either prices fall still further or banks radically loosen their lending criteria - and the second one will simply not happen.

Claiming what now ??? .. where did I say house prices wouldn't fall further .. plz read posts .. What I said was developers who buy now wont sell below the cost of purchase plus completion .. anyways read em coz I aint writing them again.

pawnacide

Oh and to say there is nobody buying houses is nonsense, we're just back to a normal market where things move more slowly.

Spiritofthekop

pawnacide wrote: »

Oh and to say there is nobody buying houses is nonsense, we're just back to a normal market where things move more slowly.

Who said houses were not selling? houses will always get sold & purchased recession or not (we are back into another recession by the way in case you did not hear)

You keep saying all these things like "we are back to normal now" this IS IN YOUR OPINION by the way!

While ignoring all the signs of more property drops for 2012 and beyond!


http://www.rte.ie/news/2012/0323/economy-business.html

washman3

Kaner2004 wrote: »

Property is over-valued now because there is no market.
But when there is a market, than what you get is the market price. Is doesnt matter whether you think its over or undervalued at all. It is valued at the price it is selling at..

Property is not selling now mainly because the banks are'nt lending.
The pre-bubble fake prices were due to the crazy lending practices of the banks. A property was only valued at say, €400k because that was the amount the bank would lend,when in actual fact the true value of the same property was only €150-€200k (just an example)
As the "great" Ben Dunne always says: the true value of something is what it makes when you have to sell it.
This theory applies accross the board, and will apply even more as the Troika put the squeeze on banks to recoup the loans from developers presently protected and molly-coddled by NAMA.
BTW, next Allsop/Space auction is May 1st. They are now beginning to accept properties from private sellers, which will really shake things up.

Kaner2004

washman3 wrote: »

Property is selling now mainly because the banks are'nt lendng.
The pre-bubble fake prices were due to the crazy lending practices of the banks. A property was only valued at say, €400k because that was the amount the bank would lend,when in actual fact the true value of the same property was only €150-€200k (just an example)
As the "great" Ben Dunne always says: the true value of something is what it makes when you have to sell it.
This theory applies accross the board, and will apply even more as the Troika put the squeeze on banks to recoup the loans from developers presently protected and molly-coddled by NAMA.
BTW, next Allsop/Space auction is May 1st. They are now beginning to accept properties from private sellers, which will really shake things up.

And Ben Dunne as the voice of wisdom

Good one. Made me laugh.

And banks will always lend what they think people can pay back. If you think they have learned any lessons this time, I think you are mistaken. Wait til they are back competing for customers again and see what they will try.

washman3

Kaner2004 wrote: »

And Ben Dunne as the voice of wisdom

Good one. Made me laugh.

And banks will always lend what they think people can pay back. If you think they have learned any lessons this time, I think you are mistaken. Wait til they are back competing for customers again and see what they will try.

Unfortunately my "overvalued" broadband service is'nt even up to the speed of your eagle eye.!! my post is corrected so read again. And i do stress that i stated that banks not lending is the main reason,though not total,that property is'nt selling.
As for Ben Dunne, well he must have some wisdom,he's a multi-millionaire while you and i are posting on boards.ie;)

StillWaters

washman3 wrote: »

As for Ben Dunne, well he must have some wisdom,he's a multi-millionaire while you and i are posting on boards.ie;)

I like and admire Ben dunne but:
He was born into privilege and wealth;
Money does not wisdom make, that much surely we have learned;
There are some very wise people (IMO) posting on boards.

Man007

Zamboni wrote: »

Personally, I think anybody buying now with a mortgage is absolutely bonkers.

Of course you would

Have you got a mortgage or what's your situation

Zamboni

Man007 wrote: »

Of course you would

Have you got a mortgage or what's your situation

Zamboni

lolo62 wrote: »

does anyone think this is an all time low or are they going to keep falling?

is now the best time to buy or should i wait?

thanks!

Still falling.

http://www.rte.ie/news/2012/0326/house-business.html

royaler83

http://www.cso.ie/en/media/csoie/releasespublications/documents/prices/2012/rppi_feb2012.pdf

The rate of the fall might start to slow down but it's only going one way

zulfikarMD

Still most EA's are posting house sale advt. way above realistic/actual house worth..i wonder what actual seller would be thinking while looking at thier own advt. Some houses on daft are sitting there with same price tag for morr than 1-2 year..

lolo62

for laurel lodge that sounds like a bargain...thats castleknock right?