Property Market 2015

Eugene Norman

Eugene Norman wrote: »

I meant cash buyers ( although at that stage they would be sellers). As would be clear from the rest of the sentence.

Ah right, sorry. Thought maybe you were suggesting a particularly category of seller who was selling to pocket the cash (for retirement or whatever) rather than to trade up. Makes sense now.

gaius c

Bob24 wrote: »

Sere here: https://www.propertypriceregister.ie/website/npsra/ppr/npsra-ppr.nsf/Downloads/PPR-2014-07-Dublin.csv/$FILE/PPR-2014-07-Dublin.csv

I can see about 45 (3.2% of all 1400 transaction).

One other thing though is that there are a quite a few bulk purchases of apartments. That's quite a few 5.7 million euros transactions which are actually for 12 apartments each (sale of a whole apartment block in Grand Canal Docks). Not sure whether gaius is giving these a special treatement but that could definitely have some impact.

That's correct but you get the other end as well. Multiple apartments selling for 5k each, etc.

I've decided not to "correct" these because that then introduces a lens I'm filtering the data through. Just present the data as is and folks can draw their own inferences from them.

The bigger the transaction volume is, the more these outliers will be "smoothened" out. Small transaction volumes exacerbates them.

Bob24

gaius c wrote: »

That's correct but you get the other end as well. Multiple apartments selling for 5k each, etc.

I've decided not to "correct" these because that then introduces a lens I'm filtering the data through. Just present the data as is and folks can draw their own inferences from them.

The bigger the transaction volume is, the more these outliers will be "smoothened" out. Small transaction volumes exacerbates them.

Yes I agree with you, overall and if volumes are high enough they will even each other out ... plus it would be a pain for you to go through the list and identify all of those.

I just meant to say that maybe the July peak could have been caused by this - with the one I picked-up and the one someone else mentioned, that's 2 full blocks of apartments sold in July. I don't know how frequently this would happen but if it is not usual and with the low volumes we have, I guess this could explain at least part of the increase that month.

gaius c

These are all the transactions over €5 million euro that could skew the results.

gaius c

Meanwhile December 2013 saw 132 transactions of exactly €8,000 for Phoenix Park race course and these would have pulled the average down for that month.
There's loads of similar transactions throughout the register.

Ultimately I don't think you can (or should) correct for those because that's based on subjective opinion.

MarkAnthony

Not a bad profit in holding on to some apartments in Leopordstown for a few months!

farrerg

gaius c wrote: »

Meanwhile December 2013 saw 132 transactions of exactly €8,000 for Phoenix Park race course and these would have pulled the average down for that month.
There's loads of similar transactions throughout the register.

Ultimately I don't think you can (or should) correct for those because that's based on subjective opinion.

Agree, once you start playing with the data, you're introducing bias, better to just stick with original data set and be aware of the limitations

Great info, very interested in the low transactions numbers so far this month, so much for all the people rushing to use their AIPs. It looks like even more people have taken a step back to see what happens in H1

gaius c

farrerg wrote: »

Agree, once you start playing with the data, you're introducing bias, better to just stick with original data set and be aware of the limitations

Great info, very interested in the low transactions numbers so far this month, so much for all the people rushing to use their AIPs. It looks like even more people have taken a step back to see what happens in H1

Be aware that it takes ages to get all the data in for a month. There's a fair bit of delay in getting the entries in. I expect that the end of March will only see approx 60% of transactions for the whole month in.

Last year I was still getting new entries for 2010!

farrerg

gaius c wrote: »

Be aware that it takes ages to get all the data in for a month. There's a fair bit of delay in getting the entries in. I expect that the end of March will only see approx 60% of transactions for the whole month in.

Last year I was still getting new entries for 2010!

Oh wow, ok, will bear that in mind!

enfant terrible

gaius c wrote: »

Be aware that it takes ages to get all the data in for a month. There's a fair bit of delay in getting the entries in. I expect that the end of March will only see approx 60% of transactions for the whole month in.

Last year I was still getting new entries for 2010!

Hi gaius c,

Would it be possible to get the chart for Limerick for 2010-2015 average selling prices like you have for Dublin, Cork and Galway?

enfant terrible

enfant terrible wrote: »

Hi gaius c,

Would it be possible to get the chart for Limerick for 2010-2015 average selling prices like you have for Dublin, Cork and Galway?

That's part of the Gaius C Premium Service for subscribers only

gaius c

Deleted User wrote: »

That's part of the Gaius C Premium Service for subscribers only

Paypal me €5 and I'll sort you out.

Got meetings all day but I'll do it this evening.

gaius c

And another thing to bear in mind is that the PPR averages won't take account of what people were actually buying. If everybody in April decided to buy 1 bed apartments and nothing else, you would expect prices to drop. Likewise if everybody in May decides to buy 6 bedroom mansionsat previous price levels, average prices would increase.

The CSO index does correct for the mix but they exclude half the market (mortgage purchases only) so there's no easy answers. I just do this for fun (and to learn excel functions) and add detail as I go.

dearg lady

http://www.independent.ie/business/personal-finance/property-mortgages/home-truths-firsttime-buyer-set-to-turn-40-31080623.html

Interesting that the author acknowledges that it is much less affordable for first time buyers during and since the boom, but still seems to shoot down the Central Banks recent regulation.

First-time buyer set to turn 40

Apart from the funny headline - which made me think it was a news story about an actual person who (gasp) was entering their fifth decade - this article points to an interesting trend: the typical FTB is getting older.

I can testify to this being in my fourth decade and from seeing people at viewings. Loads of 30-somethings, very often with a kid or kids or a bump.

The thing is, if people are 40 (or even mid-thirties) buying their house, how long will their mortgage be? You can't have a 35 year mortgage - you'd still be making repayments in your 70s.

Say if a 40 year old gets a mortgage that they plan to pay every month of their working life, they're still looking at about 25 years. Yes, retirement ages are rising too but it's fairly optimistic to expect everyone to be full-time employed at 66. People get sick, slow down, die.

Shorter mortgages means borrowing less means having less money to buy houses means lower prices.

Yep, there's nothing I read that can't lead me to the conclusion that house price rises are a thing of the past!
(CSO out with actual data on Wednesday: recall that last month showed 2% fall in prices)

dearg lady

dearg lady wrote: »

http://www.independent.ie/business/personal-finance/property-mortgages/home-truths-firsttime-buyer-set-to-turn-40-31080623.html

Interesting that the author acknowledges that it is much less affordable for first time buyers during and since the boom, but still seems to shoot down the Central Banks recent regulation.

Haha you beat me to it by mere seconds! Was just reading that article

dearg lady

Deleted User wrote: »

Yep, there's nothing I read that can't lead me to the conclusion that house price rises are a thing of the past!
(CSO out with actual data on Wednesday: recall that last month showed 2% fall in prices)

I really hope you're right! I have (anecdotally of course) heard of people getting caught up in the frenzy...even people who bought last time the madness was around!
The idea of a basic house being twice avergae industrial wage just seems like such an impossible dream at this stage!

handlemaster

[Deleted User] wrote: »

First-time buyer set to turn 40

Apart from the funny headline - which made me think it was a news story about an actual person who (gasp) was entering their fifth decade - this article points to an interesting trend: the typical FTB is getting older.

I can testify to this being in my fourth decade and from seeing people at viewings. Loads of 30-somethings, very often with a kid or kids or a bump.

The thing is, if people are 40 (or even mid-thirties) buying their house, how long will their mortgage be? You can't have a 35 year mortgage - you'd still be making repayments in your 70s.

Say if a 40 year old gets a mortgage that they plan to pay every month of their working life, they're still looking at about 25 years. Yes, retirement ages are rising too but it's fairly optimistic to expect everyone to be full-time employed at 66. People get sick, slow down, die.

Shorter mortgages means borrowing less means having less money to buy houses means lower prices.

Yep, there's nothing I read that can't lead me to the conclusion that house price rises are a thing of the past!
(CSO out with actual data on Wednesday: recall that last month showed 2% fall in prices)

people who buy later in life have more of a deposit so term is not as long. in fact you could say prices should go up with this trend

handlemaster

handlemaster wrote: »

people who buy later in life have more of a deposit so term is not as long. in fact you could say prices should go up with this trend

Hahaha we're all entitled to our biases!

What happened to boo-hoo it's impossible for FTBs to save a deposit with such high rents, trapped in rentals forever and ever etc?

The supposed reason they have to wait until they are 40 rather than 27 is because it takes so long to pull together a deposit. It's not that they are just biding their time purely out of choice, all the while their savings mount.

Anyway, I will insist on reading this as a sign that prices are set for a tumble. Until I buy a house - then it will become obvious that all indicators point to stabilisation followed by massive and sustainable price rises forever

seamus

handlemaster wrote: »

people who buy later in life have more of a deposit so term is not as long. in fact you could say prices should go up with this trend

Well.....it depends. I know a few 40-something FTBs. What they all have in common is that they're single, they have a lot of cash, they're extremely discerning about what they want, they're prepared to play games and make tough bids, and they all refused to buy during the boom because they reckoned prices were just too crazy to touch.

So I'd be surprised if that tranche make any kind of upward push on prices, in fact the opposite is more likely IMHO, and they'll wade in to make cash bids below asking on properties that aren't shifting.

The Spider

Deleted User wrote: »

Hahaha we're all entitled to our biases!

What happened to boo-hoo it's impossible for FTBs to save a deposit with such high rents, trapped in rentals forever and ever etc?

The supposed reason they have to wait until they are 40 rather than 27 is because it takes so long to pull together a deposit. It's not that they are just biding their time purely out of choice, all the while their savings mount.

Anyway, I will insist on reading this as a sign that prices are set for a tumble. Until I buy a house - then it will become obvious that all indicators point to stabilisation followed by massive and sustainable price rises forever

In my experience people in their 40's who are renting are generally single, either had a relationship breakdown and didn't settle again, or never settled in the first place.

Some have spent a lot of time travelling and going from job to job or were using the job to fund their lifestyle. Granted some are in relationships and renting but they're generally new relationships, a lot of them didn't want to get stuck on a house on their own, and liked the flexibility of renting.

As has been said a lot didn't buy in the boom, they thought it was madness or just couldn't afford to on their own.

Some invested in other things and have substantial cash reserves, the ones who travelled generally don't have anything and are living month to month, and keeping one eye on the next adventure.

The single people are desperate for a relationship or have given up, the people in relationships are looking at buying, they have more cash because they usually don't have kids, they left it too late and spent too much time enjoying themselves in their twenties/thirties.

The above is my experience with people I know, not just in Dublin either, the usual driver for a house is kids or a relationship with the potential for kids, otherwise people don't like to be tied down.

There are a lot more people than you'd think in the above scenarios, especially in Dublin, people tend to settle down in the country on way or the other, but you can easily fall off the wagon in Dublin and not get back on especially if the relationship falls apart.

The Spider

The Spider wrote: »

In my experience people in their 40's who are renting are generally single, either had a relationship breakdown and didn't settle again, or never settled in the first place.

Some have spent a lot of time travelling and going from job to job or were using the job to fund their lifestyle. Granted some are in relationships and renting but they're generally new relationships, a lot of them didn't want to get stuck on a house on their own, and liked the flexibility of renting.

As has been said a lot didn't buy in the boom, they thought it was madness or just couldn't afford to on their own.

Some invested in other things and have substantial cash reserves, the ones who travelled generally don't have anything and are living month to month, and keeping one eye on the next adventure.

The single people are desperate for a relationship or have given up, the people in relationships are looking at buying, they have more cash because they usually don't have kids, they left it too late and spent too much time enjoying themselves in their twenties/thirties.

The above is my experience with people I know, not just in Dublin either, the usual driver for a house is kids or a relationship with the potential for kids, otherwise people don't like to be tied down.

There are a lot more people than you'd think in the above scenarios, especially in Dublin, people tend to settle down in the country on way or the other, but you can easily fall off the wagon in Dublin and not get back on especially if the relationship falls apart.

But is this a new/growing trend or has there always been a group that fit the description above?

We can all think of people who never marry or who are single in their 40s after a break-up but I don't know if they have significant impact on the market - or that that impact is any bigger than it was 10 years ago.

There is also the question of what they buy. At viewings of 3/4-bed semis, I very rarely see singletons.

The_Conductor

I think its more that in a relatively illiquid market- the number of 30-40-somethings has not declined or diminished, in a similar manner to buyers in other demographic groups- which means they have a disproportionately bigger effect in the market now- than they might have done previously.

The_Conductor

The_Conductor wrote: »

I think its more that in a relatively illiquid market- the number of 30-40-somethings has not declined or diminished, in a similar manner to buyers in other demographic groups- which means they have a disproportionately bigger effect in the market now- than they might have done previously.

And what is that effect?

The_Conductor

Deleted User wrote: »

And what is that effect?

A higher proportion of 'cash buyers' expecting to have chunks knocked off asking prices- and bolshie attitudes with sellers who over-price compared to buyers expectations finding it difficult to shift properties.

Its also resulting in an abnormally large number of properties that have gone 'sale agreed' falling through and returning to the market- by some estimates- as many as 2-in-3 properties in the Dublin area- have sales falling through.

The Dublin market at the moment is highly dysfunctional and getting worse by the day. Where it was dragging the rest of the country after it with price rises- this has now reversed- and the tail is wagging the dog......

The other thing is this group of people will have lived in apartments for several years- and don't necessarily turn their noses up at apartments in the same way that would have been the case a decade ago- which explains the renaissance in apartment developments in the Dublin area. However- they do expect a significant discount to be factored into apartment prices- but they are more open to looking at them as viable long term dwelling options- particularly in highly desirable areas.

gaius c

enfant terrible wrote: »

Hi gaius c,

Would it be possible to get the chart for Limerick for 2010-2015 average selling prices like you have for Dublin, Cork and Galway?

The_Conductor

The_Conductor wrote: »

A higher proportion of 'cash buyers' expecting to have chunks knocked off asking prices- and bolshie attitudes with sellers who over-price compared to buyers expectations finding it difficult to shift properties.

Its also resulting in an abnormally large number of properties that have gone 'sale agreed' falling through and returning to the market- by some estimates- as many as 2-in-3 properties in the Dublin area- have sales falling through.

The Dublin market at the moment is highly dysfunctional and getting worse by the day. Where it was dragging the rest of the country after it with price rises- this has now reversed- and the tail is wagging the dog......

The other thing is this group of people will have lived in apartments for several years- and don't necessarily turn their noses up at apartments in the same way that would have been the case a decade ago- which explains the renaissance in apartment developments in the Dublin area. However- they do expect a significant discount to be factored into apartment prices- but they are more open to looking at them as viable long term dwelling options- particularly in highly desirable areas.

I agree with most of that (they can be fussy, patient, are happy with apartment living) but don't see the link to houses coming back to market having gone sale agreed.

I'd have thought those houses coming back to market are people who got carried away in bidding wars only to find that the bank wouldn't lend them as much as they had hoped.

The_Conductor

Deleted User wrote: »

I agree with most of that (they can be fussy, patient, are happy with apartment living) but don't see the link to houses coming back to market having gone sale agreed.

I'd have thought those houses coming back to market are people who got carried away in bidding wars only to find that the bank wouldn't lend them as much as they had hoped.

I think its people bidding on multiple properties- without a clear preference for one over the other- who know that they can keep several options open- and in some cases even paying deposits on multiple properties before deciding which they want.

I was talking to a rapidly balding KPMG receiver last weekend- and we were discussing sales in the Lucan area- one of his properties has fallen through 4 times already- but this is an exception- he did say that more often than not a sale agreed will fall through (though not 4 times obviously).

I think a lot of buyers are smelling blood in the water- and playing hardball........

Bob24

The_Conductor wrote: »

I think a lot of buyers are smelling blood in the water- and playing hardball........

I don't know if making fictitious offers on multiple properties is a great strategy for buyers though. With everyone doing that it tends to fuel bidding wars and artificially increase prices.

And it is a different debate but once a deposit is given the contract should be much more binding for both the buyer and the seller. It would save time for everybody and make the market a bit more transparent.

johnp001

Bob24 wrote: »

I don't know if making fictitious offers on multiple properties is a great strategy for buyers though. With everyone doing that it tends to fuel bidding wars and artificially increase prices.

And it is a different debate but once a deposit is given the contract should be much more binding for both the buyer and the seller.

It's one of those "prisoner's dilemma" situations where it is advantageous individually if you are a buyer and only you do this - but it is massively detrimental to all buyers if a significant number of buyers do this, fuelling bidding wars and artificially increasing prices as you say.