Property Market 2015

bidiots

joe_six_cans wrote: »

yes and where i am now focused , they are higher than on any other asset investment , i am a cash buyer BTW , ive had my money in equities since 2010

outside dublin ( and to a lesser extent galway ) , property is still cheap in ireland and im not talking about one horse towns either

What are you waiting for? Better buy it all quick.....

jmayo

joe_six_cans wrote: »

this is only a short term minor slip back , the property market is going to become considerably stronger int he coming months and years , reasons are

Any chance you can give the lotto numbers for tonight

joe_six_cans wrote: »

immigrants returning from australia , australia is sure to enter recession due to the severe slowdown in china , these irish will return home with money in their pocket and need a place to live

In all your talk about global slowdowns, you appear to forget the fact that our recovery is solely down to our export economy.
Are we immune from these effects and will our economy continue to grow to provide jobs for all these returning immigrants ?

joe_six_cans wrote: »

refugee crisis , this will increase demand for accomodation

Don't count on thousands upon thousands of refugees turning up.

joe_six_cans wrote: »

reduced interest rates , only a matter of time , rates are outrageous compared to other eurozone nations

Yeah the banks are going to drop the rates now that all those non performing loans have been dealt with and all the trackers are gone. :rolleyes:
You do know that we still have the highest percentage of non performing mortgages in the world.
The banks have to make their money somehow.

And if there are writeoffs that means the banks have to find the money somewhere, whereas if there are proper number of repossessions then house prices take a hit from increased numbers on market.

Also in all your predictions you failed to mention the possibility of increasing production of housing to meet demands.

Floodzie

joe_six_cans wrote: »

i stuck my money in equities instead which done ok but there is nearly no income from them

You'll forgive me if I don't take investment advice from someone who put their money in equities in 2012 and only did ok.

Floodzie

joe_six_cans wrote: »

refugee crisis , this will increase demand for accomodation

Are you suggesting those refugees are cash buyers? Or perhaps the banks are going to loan easy money to people with no money and no jobs?

joe_six_cans

mel123 wrote: »

I see the whole 'people coming home from Australia' thing a lot.
Unless your coming home with the full amount to buy a house out straight, you still have a long road to go. I know someone who came home from Canada thinking ah sure, I have a big deposit ill go and buy a house. Nope. The banks are looking for you to be in a new permanent job for a year, and still want to see a saving structure.
I think people coming home from abroad buying up houses will be few and far between.

if you have enough cash , you dont need a mortgage , wages are a lot higher in australia and not everyone drinks every penny they earn

joe_six_cans

Floodzie wrote: »

You'll forgive me if I don't take investment advice from someone who put their money in equities in 2012 and only did ok.

had i said they done well , i would get abuse , whats your point ?

mine is that income from property is higher than from equities and equities are more over valued than property , hence a good investment from my POV

joe_six_cans

Floodzie wrote: »

Are you suggesting those refugees are cash buyers? Or perhaps the banks are going to loan easy money to people with no money and no jobs?

i dont mean the syrians will buy anything but they will need somewhere to live eventually , this will reduce the number of available houses to either buy or rent , this will drive rents up further even it has little effect on the cost of buying a house

tharmor

The_Conductor wrote:

However- the flipside of that coin is that the main mechanism for prospective landlords to shield rental income from the taxman is by loading up any rental properties with as much debt as possible. There is also a perverse incentive not to repay principle on the loans- because the mortgage interest, which is 75% deductible as a cost- would dwindle, if the o/s principle on the loan falls.

Repaying principle means u are reducing ur loan tenure or EMI and would ultimately save on interest !!

D_D

joe_six_cans wrote: »

i dont mean the syrians will buy anything but they will need somewhere to live eventually , this will reduce the number of available houses to either buy or rent , this will drive rents up further even it has little effect on the cost of buying a house

So in a country with over 4.5M inhabitants, the potential of 4,000 refugees is going to have an impact on the housing market?

Are you nuts?

MarkAnthony

fret_wimp2 wrote: »

Id like to see this statement backed up with factual data.

Would anecdotal, qualitative data do? Just look how much a house is to buy somewhere else. Dublin, overall, is not that expensive. Yes the desirable areas are of course, I'm not sure that's different in any city.

<mod snip>

MarkAnthony

Example - Didcot £354K = 486K 15 miles from Oxford City.

15 miles from Dublin City is for example, Maynooth.

For a wee bit more.

For a wee bit less.

All in all 4 pages of potential properties.

Yep it's not Dublin, funnily enough only Dublin is but it's a similar city in that there is very little building going on and it has an underdeveloped public transit system. Perhaps a separate thread but I'd be delighted to see counter comparisons.

Archaeoliz

MarkAnthony wrote: »

Example - Didcot £354K = 486K 15 miles from Oxford City.

15 miles from Dublin City is for example, Maynooth.

For a wee bit more.

For a wee bit less.

All in all 4 pages of potential properties.

Yep it's not Dublin, funnily enough only Dublin is but it's a similar city in that there is very little building going on and it has an underdeveloped public transit system. Perhaps a separate thread but I'd be delighted to see counter comparisons.

I would say that Oxford or Cambridge are difficult comparators because the majority of the city is owned by the Universities the suburbs are artificially high. Also you're not that far from central London (46mins from Didcot Parkway to London Paddington).

MarkAnthony

This property in Kilbarrack. Perfectly reasonable 3 bed terraced.

219,950 less a 10% deposit is affordable with a combined salary of 57K. That's one person on the average industrial and one working a good casual job - perhaps part-time or perhaps a shade above minimum wage. That's assuming the couple were bad savers an only have €22K deposit.

Thats FTBs walking into a potential forever 3 bed house! Something I never dreamed you could do.

What about a couple on minimum wage - this is tough because of bloody rents but lets assume you manage to stay at home. Combined that's 36K - 126K to spend + 10% deposit, 138K.

11 (!) pages or results.

EDIT Okay lets say 9 to take out the sites a POA ass... ahem.

Holy shagpile Batman ANOTHER 3 bed house!

MarkAnthony

Archaeoliz wrote: »

I would say that Oxford or Cambridge are difficult comparators because the majority of the city is owned by the Universities the suburbs are artificially high. Also you're not that far from central London (46mins from Didcot Parkway to London Paddington).

Indeed! However Dublin does have more going for it in terms of Jobs and higher wages. No comparison is going to be perfect but I take your points. Although I would counter that Dublin has a lot of students.

I only linked Oxford as I'm very familiar with the area.

MarkAnthony

Okay another Area I'm familair with Edinburgh:

Saughton - Probably a bit like Kilbarrack/Finglas at the nicer end perhaps. £195K = 267K I bought a 4 bed end of terrace for a little more than that in D5.

Corstorphine would be the D6 equivalent - probably around the same prices as D6.

Now to be fair Edinburgh is easily accessed from Fife and you can have this for £92K in Kilkcaldy.Thats 126K which takes me back to 3 beds in Balbriggan. That said Fife would be more like being on the DART in Dublin so is a cheaper commuter belt. (30 miles out)

athtrasna

Mod note

This thread is not the place to discuss refugees.

Archaeoliz

Strange on Daft.ie this morning:

198,546 properties online (0 in the last 24 hours)

EDIT: Actually cancel that, using the advanced search there are 279 properties coming up in the last 24hrs countrywide.

mel123

joe_six_cans wrote: »

if you have enough cash , you dont need a mortgage , wages are a lot higher in australia and not everyone drinks every penny they earn

If you read my post, I said unless you have the full amount and don't need a mortgage.
Ive lived in Australia, Im well aware. The wages are higher, but the cost of living reflects this, even if you not 'spending every penny on drink'.

The_Conductor

mel123 wrote: »

If you read my post, I said unless you have the full amount and don't need a mortgage.
Ive lived in Australia, Im well aware. The wages are higher, but the cost of living reflects this, even if you not 'spending every penny on drink'.

I'd add to this- the only way to shelter rental income effectively- is the mortgage the property to the max possible- as the single biggest allowable cost against a property- is 75% of mortgage interest.

If you pay for the property outright- you will be hardpressed not to end up with a tax bill of over 50% of the gross rental income.

Greyian

The_Conductor wrote: »

I'd add to this- the only way to shelter rental income effectively- is the mortgage the property to the max possible- as the single biggest allowable cost against a property- is 75% of mortgage interest.

If you pay for the property outright- you will be hardpressed not to end up with a tax bill of over 50% of the gross rental income.

People keep saying stuff like this, but you'll still be more profitable without mortgage debt than with it.

If you have rental income of €1000 per month, with mortgage interest of €300 and mortgage principle of €300 (so total repayment is €600/month), you'd be paying tax on €775/month (€1000 - €225, €225 being 75% of €300). This would leave you with tax obligations of approximately €395/month. So after mortgage expenses + tax, you'd have income of €5/month (€1,000-€600 mortgage-€395 tax). You would have gained equity of €300 (the principle part of the mortgage), giving you a total monthly profit of €395.
With the same tax rate, but no mortgage at all, you'd be paying tax on the full €1000, but you'd have no expenses detracting from the income, so you'd have after tax income of ~€490/month.

You're only paying less tax because you're actually far less profitable. Obviously there are other expenses, but they should be equal whether the property is mortgaged or not.

MarkAnthony

Greyian wrote: »

People keep saying stuff like this, but you'll still be more profitable without mortgage debt than with it.

If you have rental income of €1000 per month, with mortgage interest of €300 and mortgage principle of €300 (so total repayment is €600/month), you'd be paying tax on €775/month (€1000 - €225, €225 being 75% of €300). This would leave you with tax obligations of approximately €395/month. So after mortgage expenses + tax, you'd have income of €5/month (€1,000-€600 mortgage-€395 tax). You would have gained equity of €300 (the principle part of the mortgage), giving you a total monthly profit of €395.
With the same tax rate, but no mortgage at all, you'd be paying tax on the full €1000, but you'd have no expenses detracting from the income, so you'd have after tax income of ~€490/month.

You're only paying less tax because you're actually far less profitable. Obviously there are other expenses, but they should be equal whether the property is mortgaged or not.

That fails to take into account the capital. With a mortgage the capital is someone else's. In your scenario you've your own capital tied up. Granted you're right about pure profit but I think that misses a step.

robp

joe_six_cans wrote: »

not especially original , ive been trying to buy a property as an investment all year , the market is going from strength to strength , especially outside dublin , dublin raced ahead since 2012 and is now taking a short breather

i wish i had bought in 2012 , i stuck my money in equities instead which done ok but there is nearly no income from them

Income from equities and rental property is taxed a lot worse than capital gains. so although income is naturally appealing it is quite undesirable.

alias no.9

The_Conductor wrote: »

I'd add to this- the only way to shelter rental income effectively- is the mortgage the property to the max possible- as the single biggest allowable cost against a property- is 75% of mortgage interest.

If you pay for the property outright- you will be hardpressed not to end up with a tax bill of over 50% of the gross rental income.

If you happen to have the cash to make a mortgage free purchase, putting the rent straight into a pension could be tax efficient.

joe_six_cans

MarkAnthony wrote: »

That fails to take into account the capital. With a mortgage the capital is someone else's. In your scenario you've your own capital tied up. Granted you're right about pure profit but I think that misses a step.

with a mortgage , the bank has a charge on the property so you have no freedom to do what you like with it until the loan is paid off

debt is over rated

joe_six_cans

robp wrote: »

Income from equities and rental property is taxed a lot worse than capital gains. so although income is naturally appealing it is quite undesirable.

thats alright during a bull market , equities are cyclical , stock markets were flat to down from 2000 all the way to 2009 , we could be entering another bear market were gains are absent , what good are low capital gains during these periods ?

robp

joe_six_cans wrote: »

thats alright during a bull market , equities are cyclical , stock markets were flat to down from 2000 all the way to 2009 , we could be entering another bear market were gains are absent , what good are low capital gains during these periods ?

We may be entering a bear or we may not being doing so but either way it is very hard to foresee. And if you can foresee it why not go for a bigger fish as Irish property might be undervalued but it is not massively undervalued like say somewhere like Somalia might be.

MarkAnthony

robp wrote: »

We may be entering a bear or we may not being doing so but either way it is very hard to foresee. And if you can foresee it why not go for a bigger fish as Irish property might be undervalued but it is not massively undervalued like say somewhere like Somalia might be.

You'd want a pretty big fish as a distraction entering a bear I'd imagine.

The_Conductor

joe_six_cans wrote: »

with a mortgage , the bank has a charge on the property so you have no freedom to do what you like with it until the loan is paid off

debt is over rated

Have you ever had a mortgage?
You can do pretty much as you please with the property- as long as you keep with the terms of the mortgage.
The whole purpose of debt- is to shelter as much of the gross rental income as possible. If the shelter is worth less than the net interest you'd gain from employing the capital elsewhere- which it would have to a remarkably good investment to be- you'd be right about debt being over-rated. However- in times of low returns elsewhere- good luck finding an ROI on the capital- greater than net tax benefit associated with the debt.

It is an anamoly- but its a global anamoly- and its not solely in the residential sector- its across business in general.

The Economist and the LSE have some very good papers discussing and debunking debt myths- if you've subscriptions to either- they're easy to find- if not- there are hard copies all in county libraries.

leinsterdude

renting out house, is a way of saving for when you get old, buy and rent it when you are 30, make very very little off it when paying off the mortgage, then when you are 60, its paid, and you got a asset, it is painful when mortgaged, but it is a great asset after ? no anyone disagree ?

The_Conductor

leinsterdude wrote: »

renting out house, is a way of saving for when you get old, buy and rent it when you are 30, make very very little off it when paying off the mortgage, then when you are 60, its paid, and you got a asset, it is painful when mortgaged, but it is a great asset after ? no anyone disagree ?

You'll whittle away the asset if you ever need nursing home care- to the point that you have little left at the end of the day?

It really is a game of swings and roundabouts...........