Interesting article in Irish Times - ‘fizz’ may be going out of Dublin market

Rother

cerastes wrote: »

What has changed in 3 years?

Probably the value of their houses and whats owed on them.

Take mine for example. Bought in 2005 for €295k.
Same house across the road sold in 2011 for €130k. And I was in Negative Equity then.
That exact house sold a couple of months for just over €200k. If mine sold for that i'm well out of NE.

Another one a couple of doors away (Mirror image of mine and the one above) on sale a couple of weeks now, (seen dozens of people viewing it), at €220k and Im told bids are up well over asking price. So assuming it is sold for over asking that puts me a long way from negative equity now.

Lots of people I know in the exact same situation. Most even better off than I am, and I thought I wasnt too badly hit at all.

seb65

Rother wrote: »

Probably the value of their houses and whats owed on them.

Take mine for example. Bought in 2005 for €295k.
Same house across the road sold in 2011 for €130k. And I was in Negative Equity then.
That exact house sold a couple of months for just over €200k. If mine sold for that i'm well out of NE.

Another one a couple of doors away (Mirror image of mine and the one above) on sale a couple of weeks now, (seen dozens of people viewing it), at €220k and Im told bids are up well over asking price. So assuming it is sold for over asking that puts me a long way from negative equity now.

Lots of people I know in the exact same situation. Most even better off than I am, and I thought I wasnt too badly hit at all.

Equity is both what you owe and what you've put in to the house. You bought yours for 295k. Depending on what, if any, mortgage you drew down for the house, your house cost you more than 295k.

You're house is in NE until there's such a point that you can recover what equity you put in. With mortgage interest, that will be more than the purchase price.

Rother

seb65 wrote: »

Equity is both what you owe and what you've put in to the house. You bought yours for 295k. Depending on what, if any, mortgage you drew down for the house, your house cost you more than 295k.

You're house is in NE until there's such a point that you can recover what equity you put in. With mortgage interest, that will be more than the purchase price.

Yes I do think i'm doing quite well. Im paying less than €1000 pm for my 3 bed house.
I have had a scary time of it during the depths of the recession, but things have worked out quite well since. Renting it would cost me a lot more than that €1000 pm. And in another 15 years (hopefully less with an extra few euro paid off the mortgage each month) I will have no mortgage.

I would like to sell up and buy in South Dublin, but may never be able to make up the difference, but where I am is fine too.

I think several people here need to look up the definition of negative equity, and then just get their coats and hang their heads in shame.

househero

Rother wrote: »

I think several people here need to look up the definition of negative equity, and then just get their coats and hang their heads in shame.

Hahahaha I know exactly what NE is without looking it up sweetheart.

Your anecdotal evidence of the Irish property market is very amusing. While your neighbours house may be on the market for 220, until it sells, it doesn't mean a thing. Until YOU sell YOUR house (as long as your paying your MTG) NE doesn't mean a thing. But almost certainty above all else, your opinion compared to the number of actual properties in Ireland in negative equity. Really don't mean a thing, unless you got that swing.

You paid €295,000 for a house that is worth €220,000 and your happy about it?

Including interest, you have lost around €120,000

Good for you to put a positive spin on things. You should get a job in an estate agents.

Frank Lee Midere

Rother wrote: »

Yes I do think i'm doing quite well. Im paying less than €1000 pm for my 3 bed house.
I have had a scary time of it during the depths of the recession, but things have worked out quite well since. Renting it would cost me a lot more than that €1000 pm. And in another 15 years (hopefully less with an extra few euro paid off the mortgage each month) I will have no mortgage.

I would like to sell up and buy in South Dublin, but may never be able to make up the difference, but where I am is fine too.

I think several people here need to look up the definition of negative equity, and then just get their coats and hang their heads in shame.

You got lucky with tracker mortgages. That's not going to last.

Anyway it's a nice story but not data on the present day market.

EDIT: in fact it indicates why , if cash leaves, prices will never rise to boom time. A 25 year mortgage for 295 would now cost 1800-2100. 250k would be 1500-1800. If the banks are stress testing and if they are enforcing about 35% of post tax income that's looking for post tax earnings of 5-6k p/m. Which is 100k+ ish.

Back to the approximation of 2.5 times earnings making a 295k house out of reach of most people. Yet that was a cheap house in 2005.

househero

Rother wrote: »

Please tell us what your understanding of negative equity is.

Then post up the actual definition beside it. Dictionary.com is a good place to start.
But for Gods sake, stop trying to pretend you know anything about economic terms when you have fallen so badly at the first hurdle.

Go back and reread my post. And YOU TELL ME where I mentioned negative equity.

Why don't you post up a definition of negative equity to help other would be property moguls like yourself in loosing €120,000

By the way, I sold my house in 2007 (probably to a genius just like you) and rented for 3 years. Some people thought i was mad in paying high rent... Turns out my prediction of the disassociation of economic fundamentals and increasing prices was spot on (if a little premature) and I was €200k better off, and I did €320k better than you and your idea of 'doing quite well' hahahahahaha

I didn't intend on rubbing it in your face Roth, but you really don't give up do you.

Go on, go back and quote me where I refer to negative equity...

Rother

Frank Lee Midere wrote: »

You got lucky with tracker mortgages. That's not going to last.

Anyway it's a nice story but not data on the present day market.

EDIT: in fact it indicates why , if cash leaves, prices will never rise to boom time. A 25 year mortgage for 295 would now cost 1800-2100. 250k would be 1500-1800. If the banks are stress testing and if they are enforcing about 35% of post tax income that's looking for post tax earnings of 5-6k p/m. Which is 100k+ ish.

Back to the approximation of 2.5 times earnings making a 295k house out of reach of most people. Yet that was a cheap house in 2005.

I certainly didnt think €295k was cheap when I bought it.

You are right though. I did get lucky with a tracker mortgage. As did most people who could avail of one. Anyone who didnt switch to a tracker when they were available was just stupid, but the vast majority who I know of did. If I wasnt on a tracker mortgage though, I have worked out that I would still not be in NE at this point.

Im not saying prices will rise or fall. I dont know where they will go. In fact I hope they fall, because that mean that the gap i have to make up to trade up is less too.

But i'm just showing an example of how many people that we might think are underwater arent necessarily in trouble at all. And it wouldnt make a difference what their house is worth now anyway unless they were selling or not paying their mortgages.

And actually they can be much better off, as you said yourself, with what they are paying, even though they paid a much higher price for their house in the boom times.

I could have been renting single room in a house for the last 10 years and paid less than what I have been paying, but where would I put the family and the business . I would have to be renting a 3 bed house for that which is going to cost me a lot more than the mortgage I am paying.

The_Morrigan

I'm locking this pending review, some of you will be well advised to read the charter before posting again on this forum.

The_Morrigan

Folks I would appreciate if you could post in a civilised and respectful manner - name calling, bickering, one up manship etc are not welcome here.

If you cannot adhere to our charter then please refrain from posting.

gaius c

Rother wrote: »

Probably the value of their houses and whats owed on them.

Take mine for example. Bought in 2005 for €295k.
Same house across the road sold in 2011 for €130k. And I was in Negative Equity then.
That exact house sold a couple of months for just over €200k. If mine sold for that i'm well out of NE.

Another one a couple of doors away (Mirror image of mine and the one above) on sale a couple of weeks now, (seen dozens of people viewing it), at €220k and Im told bids are up well over asking price. So assuming it is sold for over asking that puts me a long way from negative equity now.

Lots of people I know in the exact same situation. Most even better off than I am, and I thought I wasnt too badly hit at all.

You paid off over a third of the capital before the first decade of the mortgage was out?

Interesting...

Ritchi

gaius c wrote: »

You paid off over a third of the capital before the first decade of the mortgage was out?

Interesting...

Easily done depending on the size of deposit and length of mortgage.

gaius c

No mention of the deposit size or term but 2005 wasn't exactly 20% deposit and 20 year term country.

ixus

The charts on this thread on thepropertypin really put all of this bullsh!t in perspective.

Arrears keep growing despite 53% of all mortgages being on a Tracker. The banks will have to recapitalize again.

bidiots

ixus wrote: »

The charts on this thread on thepropertypin really put all of this bullsh!t in perspective.

Arrears keep growing despite 53% of all mortgages being on a Tracker. The banks will have to recapitalize again.

That's a scary thread. What's actually scarier, nothing is been done about the people in arrears. I'm an embarrassed 'Oirish buchail' right now!

gaius c

Foreclosure channel is blocked so the market is blocked. Only way around that blockage is cash and because NOBODY is under pressure to sell, vendors can hold the market to ransom.

Ritchi

gaius c wrote: »

No mention of the deposit size or term

No there isn't, so I'm sure you'll agree that there's no need to jump to conclusions about the validity of the statement without the facts.

jmayo

ixus wrote: »

The charts on this thread on thepropertypin really put all of this bullsh!t in perspective.

Arrears keep growing despite 53% of all mortgages being on a Tracker. The banks will have to recapitalize again.

As mentioned in that thread there has to be another recapitalisation round coming.

And what is even more galling is that the two big institutions that will have their paws out first and foremost, AIB/EBS and PTSB, are the ones coming up with ways to absolve borrowers/defaulters of their debts.

And make no mistake the next recapitalisation is going to be akin to Cyprus.

No wonder the government are pedalling furiously to talk up property and make light of fact AIB renaged on their last missed cash transfer to the Irish taxpayers.

Piriz

jmayo wrote: »

As mentioned in that thread there has to be another recapitalisation round coming.

And what is even more galling is that the two big institutions that will have their paws out first and foremost, AIB/EBS and PTSB, are the ones coming up with ways to absolve borrowers/defaulters of their debts.

And make no mistake the next recapitalisation is going to be akin to Cyprus.

No wonder the government are pedalling furiously to talk up property and make light of fact AIB renegated on their last missed cash transfer to the Irish taxpayers.

hi jmayo, can you explain this bit more clearly for us, i've no idea what is/was going on... perhaps a link?

thanks

gaius c

It's quite straightforward. They were due to make a repayment in cash to the exchequer but instead issued us with more of that valuable AIB equity.

jmayo

Piriz wrote: »

hi jmayo, can you explain this bit more clearly for us, i've no idea what is/was going on... perhaps a link?

thanks

Sorry bad spelling there.

Here is first worrying thing that I am not sure a lot of people picked up on.
It was reported that AIB has been in talks with the Government that could see a €3.5bn portion of the bank's bailout loans (about 21 billion including EBS) effectively written off this year.

Chief executive David Duffy said the state-owned bank has begun discussions with the Department of Finance that could see €3.5bn of so-called preference shares, a type of debt the bank owes taxpayers, swapped for shares in AIB.

The bank will return to profit in 2014, he said.

With the Government already owning more than 99pc of the bank, the debt for equity swap wouldn't significantly change the shareholding.

http://www.independent.ie/business/irish/aib-seeking-to-write-off-35bn-of-bailout-loans-30066841.html

Secondly they are not repaying the state for the 20 billion odd loans they got to keep them afloat.

The cost of bailing out AIB has gone up an additional €280m, after the bank was once again unable to pay interest on government rescue loans....

The bank said it expects to miss a deadline to pay the bill in cash which falls due in less than three weeks.

Instead, the bank said new ordinary shares will be handed over to settle the bill.

The Government already owns more than 99pc of the bank after a €20bn bailout.

The interest is due on a €3.5bn portion of so-called preference shares held by the National Pensions Reserve Fund Commission (NPRFC).

AIB said if the annual cash dividend is not settled in cash, it must be settled in ordinary shares.

"Following careful consideration of the interests of the bank and its shareholders, AIB has determined that the dividend of €280m, due 13 May 2014, will be settled in ordinary shares in lieu of a cash payment," it said. "As a result AIB becomes obliged to issue and allot ordinary shares to the NPRFC in accordance with AIB's Articles of Association."

http://www.independent.ie/business/irish/failure-by-aib-to-meet-cash-deadline-costs-state-280m-30216366.html

AIB is fooked and so is PTSB.
AIB cannot afford to repay the taxpayers for their bailout loans. They can't even repay the interest as it is due.
They are giving us shares when we already own nearly 99% of the bloody thing.
The mullarkey about how their actual tradable shares are worth so much is something akin to the Dutch tullip bulb market of the 1600s.

And here is the real kicker it is AIB (and PTSB) that are the ones offering debt writeoffs to defaulting customers, with no transparency for the ones footing the bill i.e. the taxpayers.

Fratton Fred

I've been looking for a property in the sandycove, Dalkey, Killiney area for some time and was basically laughing at some of the asking prices going up.

In the last two weeks, there has been some pretty big drops in what people are looking for. Reality seems to have hit the market.

Three bed terrace, reduced from €575 to €525, that sort of thing.

chris85

Fratton Fred wrote: »

I've been looking for a property in the sandycove, Dalkey, Killiney area for some time and was basically laughing at some of the asking prices going up.

In the last two weeks, there has been some pretty big drops in what people are looking for. Reality seems to have hit the market.

Three bed terrace, reduced from €575 to €525, that sort of thing.

Are other people beginning to notice drops? I am noticing some stability or slight drops in asking but unsure how exactly this is correlating to sale prices at the moment to be honest. May be time to do some research on the property price register at the weekend.

liam7831

Think we need to rename this thread Wishful thinking

Piriz

liam7831 wrote: »

Think we need to rename this thread Wishful thinking

and you support those thoughts with?

liam7831

Piriz wrote: »

and you support those thoughts with?

Bidding on numerous properties, the asking prices are deliberately low to increase interest in the property, you wont find many houses in Dublin selling for the asking.

Geuze

Theboinkmaster wrote: »

dont think it'd be that high, maybe 3-4%?

Go direct to the main data source, the SILC:

http://www.cso.ie/en/media/csoie/releasespublications/documents/silc/2012/silc_2012.pdf

sEE table A2.

The top decile have:

gross income of 1426 per equivalised person

disposable income of 958 per equivalised person.

gaius c

Fratton Fred wrote: »

I've been looking for a property in the sandycove, Dalkey, Killiney area for some time and was basically laughing at some of the asking prices going up.

In the last two weeks, there has been some pretty big drops in what people are looking for. Reality seems to have hit the market.

Three bed terrace, reduced from €575 to €525, that sort of thing.

Only at the higher end and summer is traditionally quiet. Nothing is going to seriously change while the supply tap remains throttled.

lolosaur

jmayo wrote: »

Sorry bad spelling there.

Here is first worrying thing that I am not sure a lot of people picked up on.
It was reported that AIB has been in talks with the Government that could see a €3.5bn portion of the bank's bailout loans (about 21 billion including EBS) effectively written off this year.

http://www.independent.ie/business/irish/aib-seeking-to-write-off-35bn-of-bailout-loans-30066841.html

Secondly they are not repaying the state for the 20 billion odd loans they got to keep them afloat.



http://www.independent.ie/business/irish/failure-by-aib-to-meet-cash-deadline-costs-state-280m-30216366.html

AIB is fooked and so is PTSB.
AIB cannot afford to repay the taxpayers for their bailout loans. They can't even repay the interest as it is due.
They are giving us shares when we already own nearly 99% of the bloody thing.
The mullarkey about how their actual tradable shares are worth so much is something akin to the Dutch tullip bulb market of the 1600s.

And here is the real kicker it is AIB (and PTSB) that are the ones offering debt writeoffs to defaulting customers, with no transparency for the ones footing the bill i.e. the taxpayers.

Im sorry but this is a load of nonscence. you have taken your own angle and stats and projected one big bendy lopsided arguement throwing this slanted conjecture of false information. some people may actuallly see this post and listen to you. thats the worst thing. you have put forward a pretty little post but it is all a nonscense. Aib are going nowhere. PTSB are going nowhere. I can assure you there will be no recapitalisation and there is no correlation whatsoever between cyprus and ireland.

shame on you for scaremongering with your crystal ball made of sellotape.

gaius c

lolosaur wrote: »

Im sorry but this is a load of nonscence. you have taken your own angle and stats and projected one big bendy lopsided arguement throwing this slanted conjecture of false information. some people may actuallly see this post and listen to you. thats the worst thing. you have put forward a pretty little post but it is all a nonscense. Aib are going nowhere. PTSB are going nowhere. I can assure you there will be no recapitalisation and there is no correlation whatsoever between cyprus and ireland.

shame on you for scaremongering with your crystal ball made of sellotape.

Thank you for your well researched rebuttal full of convincing citations.

lolosaur

gaius c wrote: »

Thank you for your well researched rebuttal full of convincing citations.

Id show you my rebuttal but id get an infraction.