Property Market 2015

Bob24

ezra_pound wrote: »

We just went through the greatest financial crisis the state has ever been in. We were also among the worst hit countries of the worst global crisis since 1932. It's reasonable enough to think that we won't hit such a low over the next 30. Of course it's possible, but unlikely.

Many (including myself) would say we haven't gone through the crisis yet - just parked our issues or decided to stop caring about them (our country is still contracting more debt every day, and a large part of the population would beg to differ if you tell them the crisis is over). This is not just in ireland but is the same all over Europe.

Moreover, by putting the responsibility of its QE programme into the hands of national central banks, the ECB has now given Eurozone countries some type of licence to print euros. Some of them (Ireland, France, Southern European countries) will happily use the option to devaluate the euro and try to inflate themselves out of debt. Others (Germany and Northern Europe) will do this very reluctantly and try to minimise it.

If national interests keep drifting while our debt keeps increasing, there could easily be a crisis which makes what we just went through look like a walk in the park.

Now of course this could be all wrong, but I personally don't think this is a very unlikely scenario.

And as I said, regardless of the current situation, 30 years is a very long time and a lot of parameters no one can think of right now could change dramatically during that time.

Barely Hedged

johnp001 wrote: »

I really wish that I believed that.
Global economy is in a major crisis. All our trading partners are verging on recession and the eurozone is taking action far too belatedly to prevent the type of deflationary spiral that has lasted for decades in Japan.
The end game of the current OPEC over-production strategy will lead to far higher oil prices, especially with a much weaker euro/dollar exchange rate.
Ireland's economy has no hope of prevailing against all this.

What major crisis? The kind where the 5th largest investment bank in the US is bankrupted. The biggest underwriter of insurance of CDS's and CDOs falls flat on its face. Where all of the Irish banks are insolvent and could bring down the Eurozone. Where our national unemployment rate peaked at just under 14% among a whole host of eye watering economic statistics.

The Irish economy prevailed and is growing after all these occurred in the recent past and your saying the Irish economy couldn't survive a deflation period with the trading partners that represent just under 40% of our GDP. Develop some sense of context before you talk about the sky falling in

ezra_pound

Barely Hedged wrote: »

What major crisis? The kind where the 5th largest investment bank in the US is bankrupted. The biggest underwriter of insurance of CDS's and CDOs falls flat on its face. Where all of the Irish banks are insolvent and could bring down the Eurozone. Where our national unemployment rate peaked at just under 14% among a whole host of eye watering economic statistics.

The Irish economy prevailed and is growing after all these occurred in the recent past and your saying the Irish economy couldn't survive a deflation period with the trading partners that represent just under 40% of our GDP. Develop some sense of context before you talk about the sky falling in

Hear hear

gaius c

ezra_pound wrote: »

I didn't mean Dublin specific I meant broaden your search, not look in a different county.

I'm sorry but anyone who claims that there wasn't considerable supply over demand in 2011 is not being real. This is all the more so outside of Dublin.

Nah. Supply was pretty anemic actually. The demand was zilch though because too many people were unemployed and/or couldn't get credit.

ezra_pound

gaius c wrote: »

Nah. Supply was pretty anemic actually. The demand was zilch though because too many people were unemployed and/or couldn't get credit.

Exactly. Supply was greater than demand. In areas with older people, there was a very healthy stock on account of probate sales.

yankinlk

ezra_pound wrote: »

Exactly. Supply was greater than demand. In areas with older people, there was a very healthy stock on account of probate sales.

sigh. your logic says as long as one house is not sold , its a buyers market. one more than demand and you feel that makes you correct.

we are saying supply and demand were just not there. its easy. look up any area in daft. look at the property register for that area for registered sales in the period of 2012 or 2013. almost none.

gaius c

ezra_pound wrote: »

Exactly. Supply was greater than demand. In areas with older people, there was a very healthy stock on account of probate sales.

Ireland produced more than enough food to feed itself during the famine therefore there was no famine.

That's how absurd your logic is, not least because a sizeable chunk of houses advertised for sale were/are not actually for sale.

johnp001

Barely Hedged wrote: »

What major crisis? The kind where the 5th largest investment bank in the US is bankrupted. The biggest underwriter of insurance of CDS's and CDOs falls flat on its face. Where all of the Irish banks are insolvent and could bring down the Eurozone. Where our national unemployment rate peaked at just under 14% among a whole host of eye watering economic statistics.

The Irish economy prevailed and is growing after all these occurred in the recent past and your saying the Irish economy couldn't survive a deflation period with the trading partners that represent just under 40% of our GDP. Develop some sense of context before you talk about the sky falling in

The Irish economy has exceeded expectations for the last couple of years, US and UK QE has contributed to this.
It still has many major problems though and is racking up more and more debt every day.
I stand by my assertion that the Irish economy cannot prevail in a global economic crisis in the long term.

The Spider

I bought in 2012, and as far as I can remember there was plenty of supply in Dublin, and the good areas of Dublin, 3/4 beds in Clontarf, Churchtown, Cabinteely, Rathfarnham, Dundrum and Sandyford were going for between the lowest we looked at 325,000 and the highest priced 390,000. Estate agents were begging us to make an offer one house in Cabinteely sticks out it was on sale for 375 and the estate agent said he'd guarantee we got it for 350, but we didn't think it was the house for us.

Hindsight if we had bought that and sold it in the past year and bought where we are now we'd have zero debt, but whadda ya gonna do.

ezra_pound

johnp001 wrote: »

The Irish economy has exceeded expectations for the last couple of years, US and UK QE has contributed to this.
It still has many major problems though and is racking up more and more debt every day.
I stand by my assertion that the Irish economy cannot prevail in a global economic crisis in the long term.

Your assertion is that there is a potential crisis in store that is possibly going to be worse for this country than the one we've just escaped. I'm sorry but that just is not realistic.

desertcircus

ezra_pound wrote: »

Your assertion is that there is a potential crisis in store that is possibly going to be worse for this country than the one we've just escaped. I'm sorry but that just is not realistic.

Given that we haven't fully recovered from the collapse of 2008 onwards, it wouldn't take a massive crisis to push us below where we were in 2012. We're still recovering, so any setback doesn't have to eclipse the collapse to make us worse off than 2012; it just has to be bigger than the gains made since then for us to hit a new low.

The Spider

desertcircus wrote: »

Given that we haven't fully recovered from the collapse of 2008 onwards, it wouldn't take a massive crisis to push us below where we were in 2012. We're still recovering, so any setback doesn't have to eclipse the collapse to make us worse off than 2012; it just has to be bigger than the gains made since then for us to hit a new low.

And we could be hit by an asteroid, taking into account everything that's going on QE being the big one, and the economy is actually flying it at the moment, I can't see a collapse on the horizon if anything prices will go up thanks to QE.

However no one knows how the whole Greek election is going to pan out, if they're going to leave the EU or not and will it cause a domino effect, going back to the drachma etc.

Would Italy leave and collapse the currency?

If that happened and we ended up back with the punt inflation would kick in big time and erode debt, however you'd also have job losses and the rest.

But that's a nuclear scenario, and far too speculative sometimes you can think too many moves ahead, and the guys who just thought one move ahead can win the game.

Barely Hedged

makeorbrake wrote: »

I can't really help with your comprehension difficulties other than to point out the glaring obvious...

makeorbrake wrote: »

Correct.
- The other thing is that I never envisaged such a quick turn around - and not just the pace of that turnaround but the total lack of value we now see (obviously, that's just my opinion. Evidently, plenty of others don't agree...or else this
scenario wouldn't exist).

So I question your definition of value and I have comprehension difficulties? Provide an example of where you don’t see value and what you think it should be worth.

Here is my example – house in an area of Tallaght. In 2011/12 it was €190k - €200k. It is now €260k - €270k. Increase of approximately 30%. Currently the people who are looking at buying there are nurses, Gardai, trade professionals etc all earning > €40k-€45k per annum. The same number of houses were on sale in 2011/12 as there are now.

makeorbrake wrote: »

The statistics had tanked, had they?

Very juvenile. Statistics provide a measure of the movement of an underlying. The underlying i.e. employment tanks, so too does the statistic measuring it. Not that hard to get your head around.

makeorbrake wrote: »

- 2011 was the bottom - but you could only access that if there was a property to buy. Have a look at transaction volumes - and tell me if there was necessarily property to buy.

This could be argued either way:
- there wernt enough buyers or buyers were holding off for further drops
- there wasn’t a supply of property

It’s a pointless measure as its not definitive.

In my personal experience in Dublin, property in the city centre and all residential areas was there to be bought. Supply wasn’t an issue. Trophy homes wernt being sold in D4/D6 etc but you could get cheap ones in need of renovation. Apartments in Dublin city centre were plentiful and houses in the suburbs were on sale from families emigrating, executor sales and people selling to downsize their hefty mortgages.

makeorbrake wrote: »

I said I would have been more likely to have purchased back then if I had the funds available to me that I have now (I wasn't and I am not looking to buy on the drip).

You had no funds to buy so you wernt actively looking for property but you could find no supply. One big contradiction there

makeorbrake wrote: »

- I also never foresaw such a quick turn around - I foresaw things rolling as they have done in Japan over the past decade +. ....ergo, I didn't see it the way 'intelligent' people like you did/do. I contend there's nothing rational about the irish property market regardless of what you - with the benefit of hindsight- now take issue with.

What did you base your opinion on?
- Improving management PMIs
- The improving unemployment rate
- Improving consumer sentiment index
- Narrowing government deficit
- Drops in government bond yields from 14.8% to 2%/3%
- More certainty around the debts the banks were holding
- The formation of NAMA

No, its must be the medias fault so

makeorbrake wrote: »

Ha..ha..
"another good few generations"?! That's a good one. In a banana republic where just today a 64 page magazine has been published titled "what is my house worth?" in a national daily? In a country where only seven years after the bust, we're in bubble territory again - meaning that as a nation, we have the collective memory of a goldfish? ...and you think this will take 'generations' to repeat itself?
.

A house valued at €500k in Tallaght in 2007 was valued at €190k - €200k in 2011. It is now selling for €270k max. One hell of a bubble there. Are you sure its not a correction on a very sharp and unrealistic price drop.

I bought two apartments in Dublin that I had my pick of in 2012 so I had the benefit of foresight by analysing a list of statistics that included the above, not hind sight as you point out without any evidence.

Seems like you clung to the belief that things would plateau until you had the funds available to actively participate in the market but that’s not how its worked out and perhaps this is some sort of self justification?

makeorbrake wrote: »

I'm sorry but anyone who claims that there wasn't considerable supply over demand in 2011 is not being real.

I bought two apartments from a large supply in Dublin city centre in 2012. That’s pretty real

makeorbrake wrote: »

Now you're talking about something that you had (or have) no first hand knowledge of. You're also casting the opinions of several other posters aside in your claim.

But you didn’t have the funds to buy during those years so you wernt an active participant in the market. Surely your knowledge is not first hand either?

makeorbrake wrote: »

"have seen" = past tense. "don't" = present tense negative.

Are you pointing out grammar mistakes? Surely the lowest form of debate.

Bob24

ezra_pound wrote: »

Your assertion is that there is a potential crisis in store that is possibly going to be worse for this country than the one we've just escaped. I'm sorry but that just is not realistic.

One chart to show how we have *not* escaped and are *not* doing much better than the rest of Europe: http://www.google.ie/publicdata/explore?ds=ds22a34krhq5p_&met_y=gd_pc_gdp&idim=country:ie:is:uk&hl=en&dl=en#!ctype=l&strail=false&bcs=d&nselm=h&met_y=gd_pc_gdp&scale_y=lin&ind_y=false&rdim=country&idim=country:ie:uk:de:fr&ifdim=country&tstart=791078400000&tend=1359158400000&hl=en_US&dl=en&ind=false

Barely Hedged

johnp001 wrote: »

The Irish economy has exceeded expectations for the last couple of years, US and UK QE has contributed to this.
It still has many major problems though and is racking up more and more debt every day.
I stand by my assertion that the Irish economy cannot prevail in a global economic crisis in the long term.

The ECB enacts QE and this is going to disadvantage Ireland in the same way it benefited the US and UK???

Whats the rate of increase of GDP to debt for the Irish government in the last quarter of 2014?

What is this crisis you speak of that can be worse than 2010?

The_Morrigan

The_Morrigan wrote: »

Folks can you please take the petty arguments to pm and get back on topic.

Folks do you see that mod warning from last night?? I meant it, if you can't stop taking swipes at each other I'll just lock up the thread.

johnp001

desertcircus wrote: »

Given that we haven't fully recovered from the collapse of 2008 onwards, it wouldn't take a massive crisis to push us below where we were in 2012. We're still recovering, so any setback doesn't have to eclipse the collapse to make us worse off than 2012; it just has to be bigger than the gains made since then for us to hit a new low.

Exactly, the current global crisis is the after affects of 2008 collapse. Ireland has performed better than could be expected for the last couple of years but it is unrealistic to think that the 2008 financial collapse is not still having repercussions in the global economy and that we have returned to a stable economic situation with steady growth.

Also, euro QE is happening at the same time as tightening of credit rules to buy property. It seems probable that the net effect of this will be that the new QE money could be used for credit for developers to build property instead. All signs are pointing to a pick up in construction at the moment.

gaius c

johnp001 wrote: »

Exactly, the current global crisis is the after affects of 2008 collapse. Ireland has performed better than could be expected for the last couple of years but it is unrealistic to think that the 2008 financial collapse is not still having repercussions in the global economy and that we have returned to a stable economic situation with steady growth.

Also, euro QE is happening at the same time as tightening of credit rules to buy property. It seems probable that the net effect of this will be that the new QE money could be used for credit for developers to build property instead. All signs are pointing to a pick up in construction at the moment.

The QE will be used to fill holes in bank balance sheets, pay for public sector pensions and restore pay to them as well.

The notion that the same people who pulled the ladder up after them and screwed the younger generation are going to share the bounty is naive in the extreme.

The people with assets will get wealthier as they hoover up remaining assets and they will attempt to keep extorting those without assets in order to maintain their position. The ponzi scheme will collapse because the younger generation will not be able to sustain somebody else's debt mountain. For our future, look at Japan now.

Barely Hedged

gaius c wrote: »

The QE will be used to fill holes in bank balance sheets, pay for public sector pensions and restore pay to them as well.

The notion that the same people who pulled the ladder up after them and screwed the younger generation are going to share the bounty is naive in the extreme.

The people with assets will get wealthier as they hoover up remaining assets and they will attempt to keep extorting those without assets in order to maintain their position. The ponzi scheme will collapse because the younger generation will not be able to sustain somebody else's debt mountain. For our future, look at Japan now.

That was the fear if the amount of QE undershot expectations or the amount was just used to pay down debt.

In offering such a large scale QE the hope is that it will find its way into the "real economy". Theres a bit of finger crossing required but the QE amount is sizeable

EletricMan

This is my first time having interest in the property market as I hope to buy soon, I have been bidding on houses since late last year. One thing i find in the Kildare area is that you see propertys that are on daft for a few months but keep been updated even tho they are gone sale agreed. Whats the reason for this by the estate agent? I find it very frustrating!

jay0109

EletricMan wrote: »

This is my first time having interest in the property market as I hope to buy soon, I have been bidding on houses since late last year. One thing i find in the Kildare area is that you see propertys that are on daft for a few months but keep been updated even tho they are gone sale agreed. Whats the reason for this by the estate agent? I find it very frustrating!

Advertising

The Spider

As predicted, the commuter counties are going to go through serious growth in 2015, my prediction anyway, and more than likely to be borne out.

http://www.breakingnews.ie/ireland/house-prices-move-from-recovery-to-growth-in-many-counties-659396.html

Oh and on the supply side, nit just a Dublin problem any more.

http://www.independent.ie/opinion/editorial/housing-shortage-no-longer-just-in-capital-30933254.html

The_Conductor

Spidey- you do realise that both of those sources are simply regurgitating the Indo 'index' that was published at the weekend?
Do you have any source thats based on hard empirical data- rather than fluff reporting?

The Spider

The_Conductor wrote: »

Spidey- you do realise that both of those sources are simply regurgitating the Indo 'index' that was published at the weekend?
Do you have any source thats based on hard empirical data- rather than fluff reporting?

The thread is asking for predictions for the property market in 2015, and while the indo should be taken with a pinch (handful?) of salt it's hard not to see the logic.

I've previously stated that the price rises in Dublin would push up prices in commuter counties, and that has come to pass.

I've also stated that if the 20% deposit rule comes into play that will further push up prices in commuter counties for the simple reason that substitution effect will take place, a 10% deposit saved for a house in Dublin will more than likely equal a 20% deposit outside Dublin.

Again the only empirical data is the fact that prices in Dublin have risen so much, and we can see the price rises spreading out, when I see prices are rising in Waterford then you know things are moving.

The above is what I'm basing my predictions on, it's a reasoned argument.

adam88

Was talking to s few auctioneers lately and they e seen an increased level of interest from English older buyers wanting to move to the Irish countryside due to the strength of the sterling

johnp001

gaius c wrote: »

The QE will be used to fill holes in bank balance sheets, pay for public sector pensions and restore pay to them as well.

The notion that the same people who pulled the ladder up after them and screwed the younger generation are going to share the bounty is naive in the extreme.

The people with assets will get wealthier as they hoover up remaining assets and they will attempt to keep extorting those without assets in order to maintain their position. The ponzi scheme will collapse because the younger generation will not be able to sustain somebody else's debt mountain. For our future, look at Japan now.

Unfortunately, that could well be right.
In any case the consequences of QE are, at best, housing supply starting to improve and at worst another imminent collapse due to the ponzi scheme you describe.
The argument that I was replying to above, i.e. that the global economy was successfully fixed since the 2008 crash, that we now have at least 30 years of plain sailing for the Irish economy ahead and that we should all buy some houses in north Wicklow that are appreciating at 50% a year (in a totally sustainable way)* as a surefire get-rich-quick scheme does not hold any water for me...

(* An example from the estate-agent written piece in the Independent at the weekend.)

Bob24

"One in five non-property owners in Dublin plan to buy this year"
http://blog.myhome.ie/2015/01/26/one-five-non-property-owners-dublin-plan-buy-year/

Buy, buy, buy, before it is too late, are they telling you ;-)

handlemaster

Bob24 wrote: »

"One in five non-property owners in Dublin plan to buy this year"
http://blog.myhome.ie/2015/01/26/one-five-non-property-owners-dublin-plan-buy-year/

Buy, buy, buy, before it is too late, are they telling you ;-)

Shocking 10% 30-39 yrs old living with parents. Doesnt say if this is out of necessity

gaius c

Barely Hedged wrote: »

That was the fear if the amount of QE undershot expectations or the amount was just used to pay down debt.

In offering such a large scale QE the hope is that it will find its way into the "real economy". Theres a bit of finger crossing required but the QE amount is sizeable

Again I ask, will the same people who pulled the ladder up after themselves, not only let it back down again but throw some extra cash down the ladder in order to re-ignite the economy?

Not likely in my view. Wealth is going to end up trapped in the geriatric layer just like Japan's lost decade.

ElizKenny

Just for kicks - and because i was bored last night, and nosey - I had a look at a lot of peoples predictions about property prices here, going back about 3 years. I know - im nuts.

The Spider is definitely the one with his finger on the pulse.

There are a couple of people who seem to get it wrong every year and just regurgitate the same predictions and evidence of falls every year, but for different reasons. I wont name them because its not fair.

Me, i dont have a clue what will happen to be honest. Im usually wrong when i try to predict anything economic.