Property Market 2015

SeanSouth

House prices WILL rise AND they will sell - they'll just be much smaller houses and apartments that people can afford. The price of the houses per square metre will be higher but there will be less square metres in each unit. Thats the only way it can work going forward. Higher density will also be a feature. Much more houses per hectare than before.

ec18

SeanSouth wrote: »

House prices WILL rise AND they will sell - they'll just be much smaller houses and apartments that people can afford. The price of the houses per square metre will be higher but there will be less square metres in each unit. Thats the only way it can work going forward.

Close the thread....the property market has been solved. :P

But to play devil's advocate building more or smaller units is an option and that will form part of the solution. Other parts are,

1. that land owners will have to accept that the value of their investment will not reach the what they paid for it (assuming it was bought heading towards the peak of the board.
2. Possibly some reduction in VAT to bring constuction costs down
3. Buyers need to be realistic of what they can afford and where they can afford it
4. Govt/NAMA/Developers/Banks need to stop comparing things to boom prices and trying to get them back to that level

guile4582

NinjaTruncs wrote: »

From my experience BOI wouldn't take future savings into account. they would only consider what I had at the time of application.

thanks, but do you reckon others might?

broker was very impressed with our ability to repay and one of us is a public servant

SeanSouth

Yes fully agree with all of that except that as of today none of those four conditions are true. The buyers are as much in denial as the developers are and the government also is in denial. As I said yesterday, a balance is needed between all of these. And to be fair to NAMA et al, in my experience thery are not actually looking to achieve boom time prices, they are trying to achieve prices that are reasonable. We cant just say that the average couple has 300K to spend and then expect the land owner to take whats left after the government has helped itself to 20% and the building costs have been paid. In todays world there is nothing left !!

Shedite27

Totally agree with the size of house, we just bought a 1,200sqf house, which I would have thought was far too small once upon a time.

Buying 5km from Dublin City Centre tho, something had to give and with modern furniture, flat screen TV's etc, the amount of space you need is a lot less.

Rew

guile4582 wrote: »

speaking to a broker recently we gave him our details and where we are savings wise.

with mortgage rules, we are looking to draw down 280k

now we wont have the deposit figure needed for a 350k house until june earliest, but the broker seems to think we can get loan approval in January given we about 20k away from our figure.

is he right? are they maybe leniant on the rules in certain circumstances?

They can make an exemption in 15% of cases, all the exemptions are used up for 2015 hence he's saying Jan.

the_syco

jay0109 wrote: »

The Kenny report was in the 70's. If it had being introduced then, we'd be well used to it by now and would have adapted along the way

The land nearby was farmland until the boom offered them good prices for their land. Until then, it wasn't worth their while selling it.

If the price for land never increased, the land wouldn't have been sold. I'd say this was the same for a lot of other farmers.

jay0109

the_syco wrote: »

The land nearby was farmland until the boom offered them good prices for their land. Until then, it wasn't worth their while selling it.

If the price for land never increased, the land wouldn't have been sold. I'd say this was the same for a lot of other farmers.

Twice the agricultural land price or something like that. Plenty of Farmer's son's would take that:P

gaius c

Land values in Ireland are massively out of whack with our European neighbours. Look at our argicultural land values. The stated reason is the low turnover of land. We have a similar situation with houses where stock turnover is approx half of what would be expected in other developed countries.

Sleepy

The Registered Employment Agreement (REA) has to be a fairly large factor in the high build costs in Ireland.

I've never quite understood how an unskilled to semi-skilled construction workers are "entitled" to a higher level of minimum wage protection than similarly qualified workers in other industries . A third year apprentice is entitled to a minimum of €13.95 an hour which seems fairly high for someone who's two years away from being qualified. He'll get a minimum of €16.74 the following year when he's still a year away from being qualified. Over 30k a year seems extremely generous for a 20 year old that isn't capable of doing their job unsupervised imo.

http://www.siptu.ie/divisions/utilitiesconstruction/construction/rearatesfortheconstructionindustry/

handlemaster

http://www.independent.ie/life/home-garden/the-rise-of-the-middleaged-renter-34205708.html

while the indo is crap mainly, this article does make me think that perhaps with the dynamics changing on the rental market age that this will play into property builds as well. Perhaps one bed apts will become more popular

who_ru

House prices in Limerick increasing pretty quickly if you ask me, in the area I'm looking seems most houses are going for approx €10k to €30k over asking price. Not good if you are a buyer.

The_Conductor

who_ru wrote: »

House prices in Limerick increasing pretty quickly if you ask me, in the area I'm looking seems most houses are going for approx €10k to €30k over asking price. Not good if you are a buyer.

It really depends on what the asking price was- how it related to fair market value- and whether or not estate agents and sellers were engaging in tactics to encourage prospective buyers to bid up prices- as seems to be happening in Dublin- but not very successfully.

who_ru

The_Conductor wrote: »

It really depends on what the asking price was- how it related to fair market value- and whether or not estate agents and sellers were engaging in tactics to encourage prospective buyers to bid up prices- as seems to be happening in Dublin- but not very successfully.

I'm looking in the raheen/Dooradoyle area, pretty big suburban area (plenty of amenities) where the has been 1 housing estate constructed in the last 6 years. 1!

It's the same story as everywhere else. No construction activity, more jobs, more people, not enough houses. Anything half decency results in a bidding war.

The_Conductor

That sounds like a concerted effort (I won't say collusion- but you get the drift) on the part of local estate agents and/or sellers- to encourage bidding wars......... In Dublin- despite a similar lack of construction- sellers and estate agents pushed the market beyond its means- which is why apartment prices are in reverse- and house prices barely moving.

Villa05

Shedite27 wrote: »

Totally agree with the size of house, we just bought a 1,200sqf house, which I would have thought was far too small once upon a time.

Buying 5km from Dublin City Centre tho, something had to give and with modern furniture, flat screen TV's etc, the amount of space you need is a lot less.

Again 1,200sqf is a large house by irish standards and considerably above the average.

When people say smaller houses what do they mean. What size should a 3 bed semi be?

I Am The Law

who_ru wrote: »

I'm looking in the raheen/Dooradoyle area, pretty big suburban area (plenty of amenities) where the has been 1 housing estate constructed in the last 6 years. 1!

It's the same story as everywhere else. No construction activity, more jobs, more people, not enough houses. Anything half decency results in a bidding war.

The_Conductor wrote: »

That sounds like a concerted effort (I won't say collusion- but you get the drift) on the part of local estate agents and/or sellers- to encourage bidding wars......... In Dublin- despite a similar lack of construction- sellers and estate agents pushed the market beyond its means- which is why apartment prices are in reverse- and house prices barely moving.

But so far someone always goes sale agreed at a very high price, I havent seen any evidence of sale agreeds falling through and properties coming back on the market. Also the amount of stock on the market in the area mentioned is incredibly low considering the amount of large estates.

Villa05

who_ru wrote: »

I'm looking in the raheen/Dooradoyle area, pretty big suburban area (plenty of amenities) where the has been 1 housing estate constructed in the last 6 years. 1!

It's the same story as everywhere else. No construction activity, more jobs, more people, not enough houses. Anything half decency results in a bidding war.

Queried a property there in April last year (about the time Limerick property bottomed out), a bank sale, EA advised bank was messing about.

Property was (and is currently) empty and has since been removed from Daft.

I suspect state owned banks are repossesing, warehousing stock and waiting for a particular price point to release.

gaius c

Villa05 wrote: »

Again 1,200sqf is a large house by irish standards and considerably above the average.

When people say smaller houses what do they mean. What size should a 3 bed semi be?

We have the 3rd smallest houses in Europe despite the lowest population density.

Anybody suggesting that the answer to the problem is even smaller houses either needs a rethink as to what the question is or is a vested interest working out how to maintain high prices.

SeanSouth

@Gaius, I always enjoy your posts. I remember your posts from December 2013 in particular, when you wrote at length about how the sky was falling down and property prices were about to tank. At that time you said this was because of all the repossessions that were about to happen which would flood the market with supply. Many of us at that time predicted 10% rises for the following year which actually did happen..........Here's another prediction for you now. House prices in Dublin will rise by in excess of 15% next year. Lets see if this happens or not.

The_Conductor

SeanSouth wrote: »

Here's another prediction for you now. House prices in Dublin will rise by in excess of 20% next year. Lets see if this happens or not.

House price increases in Dublin have already fallen considerably (they're still in positive territory- but the high rates seen in the last 2-3 years- are now in the distant past)- and apartment prices in Dublin- are in actual fact falling. Whatever about Gaius having been unduly pessimistic in the past- you are a fountain of unfounded optimism. 20% increase for Dublin house prices in the next year- lets hold you to your prediction and see what comes of it- I'm not offering to eat items of clothing if it comes to pass- its just getting more unlikely by the day.

Have a look at the likes of the Allsop auctions- at the numbers of properties failing to sell- and the prices that are being achieved on the day- auctions like Allsop which shift hundreds of properties over a day or two- are probably as good a barometer of where we truly are at- as are any other measures.

SeanSouth

I don't get any joy out of seeing property prices rising. I have no vested interest in it. I do confess to getting a kick out of predicting what will happen next and why and from where I'm sitting prices have to rise in the medium term due to drastic shortage of supply. I fully agree with you that Allsops is a great indicator of the market but i see no evidence at those auctions that prices are actually falling !! Property failing to sell at these auctions is just an indicator that the maximum reserve is set too high. If you trawl through the results of sold properties its clear that the trajectory is upwards, strongly upwards and even though you are not the first person to say that prices in Dublin are falling, i can see no evidence of that whatsoever. Houses are taking longer to sell in certain cases , but not at lower prices. I dont think so. If you look at the property price register you can see this for yourself.........

Santy2015

I have no interest in house prices rising in the near future but it's inevitable. Already a trend in towns less then an hours drive to Dublin, Cork etc. Mallow house prices are rising slightly and you can see small increases in kanturk too, even though there is a good enough supply in both areas in my opinion

makeorbrake

SeanSouth wrote: »

@Gaius, I always enjoy your posts. I remember your posts from December 2013 in particular, when you wrote at length about how the sky was falling down and property prices were about to tank. At that time you said this was because of all the repossessions that were about to happen which would flood the market with supply. Many of us at that time predicted 10% rises for the following year which actually did happen..........Here's another prediction for you now. House prices in Dublin will rise by in excess of 15% next year. Lets see if this happens or not.

In fairness to him, there were repossessions that should have been happening - that's the way it would have played in any other country - just not this corrupt backwater. Here we are - how long later and they still haven't happened.

makeorbrake

beard_grower wrote: »

lack of repossessions is down to left wing politics , its seen as cruel to evict people , its one of the reasons why so little property is available , no repossessions are happening

Is it even left wing? I don't particularly see myself being right wing. The bankruptcy deal should have been brought down to 12 months right at the start of the mess and a social housing building plan should have been put into place together with sorting out security of tenure and the prtb (disgusted with recent move that places greater powers with the prtb when they are simply not performing their function as it stands).

Villa05

beard_grower wrote: »

lack of repossessions is down to left wing politics , its seen as cruel to evict people , its one of the reasons why so little property is available , no repossessions are happening

The lack of repossesions is more about protecting the wealthy than the poor. The poor are just caretakers of the houses untill the wealthy can get the price they want to protect their own interests

Villa05

beard_grower wrote: »

i doubt that , the media is anti wealth in this country and there are no votes in being seen to protect the well heeled

plenty of working people who are not paying their mortgages too

The vast majority of the wealth created during the boom was from property. The lack of repossesions is part of the plan to reinflate property prices to restore the wealth to the people/institutions that were most culpable for the collapse of this country in late 2008.

People seem oblivios to all this making it very easy for this plan to succeed despite it being detrimental to the country and its people.

makeorbrake

Villa05 wrote: »

People seem oblivios to all this making it very easy for this plan to succeed despite it being detrimental to the country and its people.

You've hit the nail firmly on the head. Many of the professions involved in the charade surrounding repossessions are cutting savvy deals on their own withered tiger portfolio's whilst kicking the can down the road with others, racking up expenses in the process.

gosplan

The repossessions thing is not about protecting the vulnerable.

It's about what 20% of irish houses(or whatever the figure is) coming on the market would do.

If we have indeed bottomed, recovered a bit and now flatlined, it's surely the last issue to resolve.

Not saying I agree or disagree with this approach but I think that's the rationale.

handlemaster

Villa05 wrote: »

The vast majority of the wealth created during the boom was from property. The lack of repossesions is part of the plan to reinflate property prices to restore the wealth to the people/institutions that were most culpable for the collapse of this country in late 2008.

People seem oblivios to all this making it very easy for this plan to succeed despite it being detrimental to the country and its people.

Imagine if prices never increased and the government I. E. The people were left with all that Nama property with no buyers. How much better would the country be? I think the government did the right thing let prices rise sell all the crap and then start looking at cooling prices.