Dublin (and everywhere) house prices FALL in January 2014

dinnyirwin

Stats can say anything.
Anyone out there in the market can see exactly the situation that is out there now.
Lots of people around trying to predict what cant be predicted even by experts.
Lets see what happens from May until October.

And right now, even with prices rising, property is not that expensive compared to wages. People just dont want to live where their income bracket puts them. You have to go back well over 10 years to get to the same price as today.

Frank Lee Midere

dinnyirwin wrote: »

Stats can say anything.
Anyone out there in the market can see exactly the situation that is out there now.
Lots of people around trying to predict what cant be predicted even by experts.
Lets see what happens from May until October.

And right now, even with prices rising, property is not that expensive compared to wages. People just dont want to live where their income bracket puts them. You have to go back well over 10 years to get to the same price as today.

Or they want to wait until their income catches up with where they want to live.

Brussels Sprout

dinnyirwin wrote: »

And right now, even with prices rising, property is not that expensive compared to wages.

really? I hope your basis for this isn't the wages to house price ratio of the early noughties

lima

dinnyirwin wrote: »

Stats can say anything.
Anyone out there in the market can see exactly the situation that is out there now.
Lots of people around trying to predict what cant be predicted even by experts.
Lets see what happens from May until October.

And right now, even with prices rising, property is not that expensive compared to wages. People just dont want to live where their income bracket puts them. You have to go back well over 10 years to get to the same price as today.

Prices are falling :-)

lima

Irish independent:

Property price rises - front page news. Keywords: Soaring prices
Property price falls - back page news. Keywords: Easing of rises

So funny.

http://www.independent.ie/business/personal-finance/property-mortgages/easing-in-property-price-rises-last-month-cso-30047383.html

Let's hope a self-fulfilling prophesy works the other way around too

dinnyirwin

Im sure anybody actually active in the market can tell you whats going on with prices. You wont find anybody active on the market at the moment telling you that they have noticed prices are falling.
It would be lovely if they were falling a little bit or staying level, but its not happening.

I would really like to hear more about the workings of the CSOs numbers.
There is definitely something up there.

All I seem to hear is people who cant afford to buy a house complaining that they are not falling and predicting/wishing they will fall in the future.

Household incomes of those who can afford to buy houses are far higher than they were 10 or so years ago. It just happens that there are less of them as banks wont lend to people who cant afford a mortgage anymore. So what we have left is a smaller supply of property and a smaller amount, but proportionally larger amount of people who can afford these properties.

There are people frozen out, who will remain frozen out, but thats always been the case apart from 4 or 5 years of madness where a mortgage would be given to anybody.

I was just listening to someone in his late early 40s the other day saying that he could afford to buy now but was going to wait for another few years. Lets see him get a mortgage in the latter end of his 40s.

And Ive heard from and read on here a few times people in their early 20s and on low wages with tiny deposits saved complaining that they cant get a mortgage.

A friend of mine is a barman and his wife works in a creche. Same jobs as they had when he bought his house in 2003 and went on a tracker when they were all the rage. His house is worth a little less than he bought it for, but he is now 11 years into a 25 year mortgage, so not in negative equity and paying just under €1000 pm for the mortgage. The exact same house across the road from him was recently advertised for rent at €1350. They would never be able to get a mortgage now, even though they still work at the same jobs and earn more than they did then.

There is a sweet spot for getting a mortgage and like it or not, if you are not in that sweet spot you are not getting a mortgage. But it seems that there are enough people who qualify for one, to move the current supply for some time to come.

lima

dinnyirwin wrote: »

Im sure anybody actually active in the market can tell you whats going on with prices. You wont find anybody active on the market at the moment telling you that they have noticed prices are falling.
It would be lovely if they were falling a little bit or staying level, but its not happening.

I would really like to hear more about the workings of the CSOs numbers.
There is definitely something up there.

All I seem to hear is people who cant afford to buy a house complaining that they are not falling and predicting/wishing they will fall in the future.

Household incomes of those who can afford to buy houses are far higher than they were 10 or so years ago. It just happens that there are less of them as banks wont lend to people who cant afford a mortgage anymore. So what we have left is a smaller supply of property and a smaller amount, but proportionally larger amount of people who can afford these properties.

There are people frozen out, who will remain frozen out, but thats always been the case apart from 4 or 5 years of madness where a mortgage would be given to anybody.

I was just listening to someone in his late early 40s the other day saying that he could afford to buy now but was going to wait for another few years. Lets see him get a mortgage in the latter end of his 40s.

And Ive heard from and read on here a few times people in their early 20s and on low wages with tiny deposits saved complaining that they cant get a mortgage.

A friend of mine is a barman and his wife works in a creche. Same jobs as they had when he bought his house in 2003 and went on a tracker when they were all the rage. His house is worth a little less than he bought it for, but he is now 11 years into a 25 year mortgage, so not in negative equity and paying just under €1000 pm for the mortgage. The exact same house across the road from him was recently advertised for rent at €1350. They would never be able to get a mortgage now, even though they still work at the same jobs and earn more than they did then.

There is a sweet spot for getting a mortgage and like it or not, if you are not in that sweet spot you are not getting a mortgage. But it seems that there are enough people who qualify for one, to move the current supply for some time to come.

I will trust CSO figures about prices going down as much as CSO figures about prices going up

If someones house is worth less but they are not in NE because they've chipped at the mortgage it still means they paid money for it.
If house was bought at 200k and only worth 160 but they've paid off 40k they have still lost 40k.

Mortgage lending is down:
http://www.irishtimes.com/business/sectors/financial-services/mortgage-lending-down-last-year-1.1702778

Most of the buyers are cash buyers.

I suppose I am in a 'sweet spot' being early 30's and having mortgage approval for a reasonable house in Dublin (excl. SCD (apart from Tallaght etc.) and D6, d# etc.) but I like a lot of others are choosing to wait until either decent stock becomes available or prices fall again, like they are now.

MouseTail

lima wrote: »

If someones house is worth less but they are not in NE because they've chipped at the mortgage it still means they paid money for it.
If house was bought at 200k and only worth 160 but they've paid off 40k they have still lost 40k.

They haven't lost €40k, this is very basic, but lots of people don't get it. Had the house value risen to €240k they would not be €40k richer.

hfallada

Negative equity only matters when you sell. It's like buying a Ryanair share and the price failing by 30% in a year. That fall only matters when you sell at the that moment. As the share Pryce could rise by 50% the following year

Barely Hedged

lima wrote: »

I will trust CSO figures about prices going down as much as CSO figures about prices going up

If someones house is worth less but they are not in NE because they've chipped at the mortgage it still means they paid money for it.
If house was bought at 200k and only worth 160 but they've paid off 40k they have still lost 40k.

Mortgage lending is down:
http://www.irishtimes.com/business/sectors/financial-services/mortgage-lending-down-last-year-1.1702778

Most of the buyers are cash buyers.

I suppose I am in a 'sweet spot' being early 30's and having mortgage approval for a reasonable house in Dublin (excl. SCD (apart from Tallaght etc.) and D6, d# etc.) but I like a lot of others are choosing to wait until either decent stock becomes available or prices fall again, like they are now.

I can understand your thinking about waiting for a larger amount of housing stock to come onto the market but prices fall again? What sort of percentage drops are you thinking will happen? We've seen a massive drop of 50% over the past 5/6 years. Nothing on that scale will happen again. If it drops, id say it might be no more than 5%, if even. If the house you can afford would be whats available in Tallaght, then you'd be looking at around €200k i take it. 5% of €200k - sure thats just €10k. Are you being penny smart and pound foolish by holding off and not looking?

seb65

MouseTail wrote: »

They haven't lost €40k, this is very basic, but lots of people don't get it. Had the house value risen to €240k they would not be €40k richer.

Wrong. On your balance sheet you'd have an extra 40K in assets.

MouseTail

seb65 wrote: »

Wrong. On your balance sheet you'd have an extra 40K in assets.

Its not real until its realised. The same with any asset.

seb65

MouseTail wrote: »

Its not real until its realised. The same with any asset.

Yet it is still included in your net worth - making you 40 k "richer".

desertcircus

Barely Hedged wrote: »

I can understand your thinking about waiting for a larger amount of housing stock to come onto the market but prices fall again? What sort of percentage drops are you thinking will happen? We've seen a massive drop of 50% over the past 5/6 years. Nothing on that scale will happen again. If it drops, id say it might be no more than 5%, if even. If the house you can afford would be whats available in Tallaght, then you'd be looking at around €200k i take it. 5% of €200k - sure thats just €10k. Are you being penny smart and pound foolish by holding off and not looking?

The mortgage market is down to two billion a year, from 28 at the peak. The only thing keeping house prices up at the moment is the fact that half the market is made up of cash purchases, but that well isn't infinite - and nobody really knows what will happen to house prices if and when cash sales dry up. We don't currently have a properly functioning housing market, so guesses that we have no more than 5% further falls to go are just that - guesses.

Villa05

dinnyirwin wrote: »

And right now, even with prices rising, property is not that expensive compared to wages. People just dont want to live where their income bracket puts them. You have to go back well over 10 years to get to the same price as today.

Alot of sh%t happened in those 10 years. Ireland is a very different country

gaius c

Barely Hedged wrote: »

I can understand your thinking about waiting for a larger amount of housing stock to come onto the market but prices fall again? What sort of percentage drops are you thinking will happen? We've seen a massive drop of 50% over the past 5/6 years. Nothing on that scale will happen again. If it drops, id say it might be no more than 5%, if even. If the house you can afford would be whats available in Tallaght, then you'd be looking at around €200k i take it. 5% of €200k - sure thats just €10k. Are you being penny smart and pound foolish by holding off and not looking?

So it'll be a "soft landing"?

Barely Hedged

desertcircus wrote: »

The mortgage market is down to two billion a year, from 28 at the peak. The only thing keeping house prices up at the moment is the fact that half the market is made up of cash purchases, but that well isn't infinite - and nobody really knows what will happen to house prices if and when cash sales dry up. We don't currently have a properly functioning housing market, so guesses that we have no more than 5% further falls to go are just that - guesses.

Well considering that we experienced the large drop in prices due to very harsh economic corrections hitting the country in 2008 - 2010, i cant forsee the same economic shocks so no further large price drops.

As i pointed out earlier

Barely Hedged wrote: »

The UK property market, which is quite comparable to the Irish one, registers cash buyers of 30% - 50% on average as a proportion of all transactions. Even when you strip out the past two years where Euro zone residents have been dumping their cash on London property.

So, even though we had cash buyers registering around 5-10% of sales in 2010 in Ireland, they still form a large part of a property market whether it is considered by observers to be fully functioning or distorted (if either of these two states ever exist). So, theyre not going away.

Cash buyers dont just "disappear". Theyre an integral part of the property market as are mortgage participants

Barely Hedged

gaius c wrote: »

So it'll be a "soft landing"?

Considering that we experienced the large drop in prices due to very harsh economic corrections hitting the country in 2008 - 2010, i cant forsee the same economic shocks so no further large price drops. I dont know how improving economic stats point to large property price falls other than what has occurred already? Maybe im missing something.

A "landing" from what - theyve already fallen around 50%. How much more do you think they will fall. Id say its fair to say, we've "landed"

marathonic

Barely Hedged wrote: »

A "landing" from what - theyve already fallen around 50%. How much more do you think they will fall. Id say its fair to say, we've "landed"

There are 3-bed semi's built in 2007 available in my local town in Donegal for €60,000. After a 10% deposit, you would be applying for near enough the smallest mortgage the banks will give.

If they fall any further here, we're going to have to start taking out car loans to buy houses.

anncoates

Barely Hedged wrote: »

A "landing" from what - theyve already fallen around 50%. How much more do you think they will fall. Id say its fair to say, we've "landed"

Don't piss on their parade. They're convinced that an idyllic "functioning property market" is on the way and prices will drop forever and ever until sellers will actually have to pay people to take their SCD redbricks off their hands.

marathonic

anncoates wrote: »

Don't piss on their parade. They're convinced that an idyllic "functioning property market" is on the way and prices will drop forever and ever until sellers will actually have to pay people to take their SCD redbricks off their hands.

But a house is going to become a liability as opposed to an asset when the water charges come in......

Barely Hedged

marathonic wrote: »

There are 3-bed semi's built in 2007 available in my local town in Donegal for €60,000. After a 10% deposit, you would be applying for near enough the smallest mortgage the banks will give.

If they fall any further here, we're going to have to start taking out car loans to buy houses.

Exactly. I dont understand the logic of some posters here.

I consider 2010 - 2012 prices a floor for property prices. Why - terrible economic stats and outlook, 5% - 10% of the market were cash buyers and mortgage approvals and draw downs tanked.

Now we have the situation where economic stats are improving consecutively 50 odd % of the market (i.e. slightly above normal levels) are cash buyers. Now its pointed out that mortgage approvals are only slightly down on previous figures which showed marked improvements from 2011 levels and we have certain posters claiming the sky is going to fall again.

It all seems like straw clutching to me when you compare the two scenarios above.

Im not here saying prices are going to boom, im merely saying that if you think youre smart to hold off because prices are going to fall massively again, you'll be proven wrong

Mr.McLovin

Barely Hedged wrote: »

The UK property market, which is quite comparable to the Irish one, registers cash buyers of 30% - 50% on average as a proportion of all transactions. Even when you strip out the past two years where Euro zone residents have been dumping their cash on London property.

So, even though we had cash buyers registering around 5-10% of sales in 2010 in Ireland, they still form a large part of a property market whether it is considered by observers to be fully functioning or distorted (if either of these two states ever exist). So, theyre not going away.

I'm not suggesting they will go away, I do feel there is a bottle neck because of a lack of decent family homes in decent areas.

moxin

lima wrote: »

Irish independent:

Property price rises - front page news. Keywords: Soaring prices
Property price falls - back page news. Keywords: Easing of rises

So funny.

http://www.independent.ie/business/personal-finance/property-mortgages/easing-in-property-price-rises-last-month-cso-30047383.html

Let's hope a self-fulfilling prophesy works the other way around too

This is how bad our media are, there definitely is no impartiality.

TheJournal.ie which is connected to Daft and this site does not have this story. They had every single previous story about the CSO index when prices were rising.
Irish Times - it was buried yesterday on their site, you had to go looking for it, it was not obvious to the eye. It was not on their home page all day and was not there by 5pm. Previous stories of price rises were.

RTE kept the news in their Business section, previous CSO stories on the index had always occupied space on their News page as well as the Business page.

Mr.McLovin

moxin wrote: »

This is how bad our media are, there definitely is no impartiality.

TheJournal.ie which is connected to Daft and this site does not have this story. They had every single previous story about the CSO index when prices were rising.
Irish Times - it was buried yesterday on their site, you had to go looking for it, it was not obvious to the eye. It was not on their home page all day and was not there by 5pm. Previous stories of price rises were.

RTE kept the news in their Business section, previous CSO stories on the index had always occupied space on their News page as well as the Business page.

http://www.independent.ie/business/personal-finance/house-prices-outside-capital-rise-for-first-time-since-2008-30048857.html

check out the picture on how happy the couple are about soaring prices in that article

average_runner

New trackers be out soon!!!:eek:

noodler

average_runner wrote: »

New trackers be out soon!!!:eek:

I don't know what one of them is!

Muahahaha

moxin wrote: »

This is how bad our media are, there definitely is no impartiality.

TheJournal.ie which is connected to Daft and this site does not have this story. They had every single previous story about the CSO index when prices were rising.
Irish Times - it was buried yesterday on their site, you had to go looking for it, it was not obvious to the eye. It was not on their home page all day and was not there by 5pm. Previous stories of price rises were.

RTE kept the news in their Business section, previous CSO stories on the index had always occupied space on their News page as well as the Business page.

Sometimes I think that the newsroom where their dodgy writing gets written has a big whiteboard up on the wall with two columns to explain the papers editorial line so all the journos are on the same hymn sheet. It probably goes something like this-

Bad- fuel/energy increases, food and drink increases, insurance increases
Good - Property price rises

They must think the public are a bunch of idiots. The joke is on them though as hardly anyone is reading their bile anymore- only 5% of the Irish public buy a newspaper on a daily basis.

noodler

moxin wrote: »

This is how bad our media are, there definitely is no impartiality.

TheJournal.ie which is connected to Daft and this site does not have this story. They had every single previous story about the CSO index when prices were rising.
Irish Times - it was buried yesterday on their site, you had to go looking for it, it was not obvious to the eye. It was not on their home page all day and was not there by 5pm. Previous stories of price rises were.

RTE kept the news in their Business section, previous CSO stories on the index had always occupied space on their News page as well as the Business page.

I read the Times and Indo everyday and I think that is a huge exaggeration.

The monthly increases from the CSO have been given the same standard attention as the mild decrease yesterday.


I can't speak for thejournal though as I would be less familar with it.

The Spider

I've said it before, I'll say it again, the bottom was 2011-2012, there won't be a huge crash anytime soon, even if prices dipped 10%, people would pile in again as they see value and drive the prices straight back up.

There isn't enough supply, prices will rise and the lack of supply is just one side, because there's a lack of people to actually build more supply after the last crash, all the builders are out of business, emigrated or doing something else.

Students or other lads have avoided the building trade like the plague.

Every month I'm looking more and more right, give it another few months and the whole I can't buy in SCD will be long gone, it'll be I can't buy in NCD, and eventually I can't buy in Blanch or Lucan.

Anyone who could have bought last year or this year and didn't will be kicking themselves this time next year, because these rises will be here for ten years at least.

Unless we somehow magically build a huge amount of houses inside the M50....but I can't see it happening!