Property Market 2017

rsynnott

Bob24 wrote: »

I don't know how accurate an idea it gives of the price for upcoming new-builds around town, but this one near Pearse Street almost instantly sold-out with 2 beds apartments priced 575k (!) : http://www.irishtimes.com/business/economy/near-sell-out-for-silicon-docks-apartment-launch-1.3075380

It'll be a bit of an outlier. GCD is bonkers.

Samuel T. Cogley

rsynnott wrote: »

It'll be a bit of an outlier. GCD is bonkers.

Until Poolbeg comes along then it's just be normal for D4.

D4 and D1's regeneration was never going to come cheap.

quadrifoglio verde

Somehow I've managed to refind this article.
It's for 2008 and talking about the previous 20 years from 1988 to 2008.
https://www.irishtimes.com/life-and-style/homes-and-property/twenty-years-a-viewing-the-ups-and-downs-of-the-property-pages-1.939457?mode=amp

Ten years since the heady days of 2007, I'm hearing something that I don't like hearing.

This time it's different. This time it's different sends shivers down my spine.

Spoke to a family friend today who's selling a development site in Dublin 7. It's already 60% above its asking price.

jamesthepeach

My sister bought her house in 2007 and went on a tracker.
She is half way through the mortgage now and recently our cousin bought the exact same house across the road.
Our cousin's house was a lot cheaper to buy, she told us the details when saying she feels sorry for my sister who bought her house at the peak.

But it turns out her payments are over €250 pm higher than my sisters and my cousin will still be paying hers 15 years after my sister has finished paying her mortgage off. Plus cous has been paying rent for the last 10 years too where sis hasn't.

I didn't have the heart to explain this to dear cous. She's happy she got the best deal.

My sister is considering​ overpaying now by around €500 pm as she is in a good position to pay it off in half the time too.

It's all about luck rather than timing or price.

Bob24

rsynnott wrote: »

Bob24 wrote: »

I don't know how accurate an idea it gives of the price for upcoming new-builds around town, but this one near Pearse Street almost instantly sold-out with 2 beds apartments priced 575k (!) : http://www.irishtimes.com/business/economy/near-sell-out-for-silicon-docks-apartment-launch-1.3075380

It'll be a bit of an outlier. GCD is bonkers.

Keep in mind they call it GCD / silicon dock on the marketing documents to make it sound attractive but the actual location is more next to the Eurospar on Townsend Street, a bit off GCD and fairly dodgy at times.

jamesthepeach

I'm thinking of selling am apartment in North Dublin so got a few estate agents out to it yesterday to do valuations. The last email just came in this morning.
Apartments must be going up fast because I got, I have to say a pleasant, shock when I looked at the valuation they each gave me.
I thought they were much lower than they actually are. One of them told me apartments have taken off in the last few months. Must speak to the others today.
I think at this price I will definitely put one on the market.
I also have another in Dublin city center that I have to move into for a little while, but I think again at those prices might sell it rather than rent it out again.
I have a terrible feeling they is another economic catastrophe just around the corner which will in turn affect Ireland and then the property market.
Maybe a bird in the hand is the way to go.

Villa05

jamesthepeach wrote:

My sister is considering​ overpaying now by around €500 pm as she is in a good position to pay it off in half the time too.

She might be better off putting the 500 elsewhere if she is on a tracker

jamesthepeach

Villa05 wrote: »

She might be better off putting the 500 elsewhere if she is on a tracker

That's exactly what I advised her to do. I think she just wants the mortgage gone now that she is so close.

Sleepy

Tell her to invest it somewhere it grows faster than the mortgage interest to use as a baloon payment.

karenalot

jamesthepeach wrote: »

My sister bought her house in 2007 and went on a tracker.
She is half way through the mortgage now and recently our cousin bought the exact same house across the road.
Our cousin's house was a lot cheaper to buy, she told us the details when saying she feels sorry for my sister who bought her house at the peak.

But it turns out her payments are over €250 pm higher than my sisters and my cousin will still be paying hers 15 years after my sister has finished paying her mortgage off. Plus cous has been paying rent for the last 10 years too where sis hasn't.

Yes its not all bad for everyone who purchased during the boom. Mine was a 3 bed semi in North Kildare in 2006 with a tracker mortgage which is now €800 per month. To buy an identical house at todays interest rates with the same years left on the mortgage it would cost €1400 per month. To rent my house it would cost €1600 a month.

While I'd hardly count myself lucky for buying at the top it turns out it hasn't been the worst thing in the world either. FTB friends of mine who are looking to buy now in 2017 are finding themselves struggling with high rents and a lack of supply driving prices up beyond their budgets.

rsynnott

Bob24 wrote: »

Keep in mind they call it GCD / silicon dock on the marketing documents to make it sound attractive but the actual location is more next to the Eurospar on Townsend Street, a bit off GCD and fairly dodgy at times.

Oh, you're right, so it is. I just assumed from the names that it was that construction site on Hanover Quay right to the east. Okay, that's terrifying, then.

Michael D Not Higgins

jamesthepeach wrote: »

My sister bought her house in 2007 and went on a tracker.
She is half way through the mortgage now and recently our cousin bought the exact same house across the road.
Our cousin's house was a lot cheaper to buy, she told us the details when saying she feels sorry for my sister who bought her house at the peak.

But it turns out her payments are over €250 pm higher than my sisters and my cousin will still be paying hers 15 years after my sister has finished paying her mortgage off. Plus cous has been paying rent for the last 10 years too where sis hasn't.

I didn't have the heart to explain this to dear cous. She's happy she got the best deal.

My sister is considering​ overpaying now by around €500 pm as she is in a good position to pay it off in half the time too.

It's all about luck rather than timing or price.

This situation ignores plenty of variables, including inflation, deposit percent, etc.

Tweaking some numbers and using the info above the only sensible way the numbers work out is if the mortgage from 2007 had a large deposit.
Example
330k price, 50% deposit and 1% tracker over 20 years gives 750 mortgage
200k price, 10% deposit and 4.5% variable over 25 years gives 1000 mortgage

Interestingly in the above example the lifetime cost for the second mortgage is 25k less, not taking any inflation savings into account.

Bob24

rsynnott wrote: »

I just assumed from the names that it was that construction site on Hanover Quay right to the east.

Yes I live across the street from that one (bothered by the noise of construction work everyday except on Sundays!), and I am actually curious to know how many apartments it will have and what the prices will be. I was expecting crazy stuff in the line of 700k for 2 beds but other people's feel on this thread a few weeks ago was that even for GCD it would be much lower than that. Still wondering!

jamesthepeach

Michael D Not Higgins wrote: »

This situation ignores plenty of variables, including inflation, deposit percent, etc.

Tweaking some numbers and using the info above the only sensible way the numbers work out is if the mortgage from 2007 had a large deposit.
Example
330k price, 50% deposit and 1% tracker over 20 years gives 750 mortgage
200k price, 10% deposit and 4.5% variable over 25 years gives 1000 mortgage

Interestingly in the above example the lifetime cost for the second mortgage is 25k less, not taking any inflation savings into account.

Couldn't tell you all the figures.
I can tell you that I know what they both pay now and for how long their terms are. And the years they bought their houses and that the houses are the exact same.

Oh and I know my sister is on .5% above ecb and her house definitely cost more than 350 and she didn't have a large deposit at all. In fact I loaned her some of the money to scrape it up. thats as much as I know. And my sisters was 20 years and my cousin's is 30.

If I was nosey enough I suppose I could find out how much my cousin's house cost, but I'm not that fussed.

Michael D Not Higgins

jamesthepeach wrote: »

Couldn't tell you all the figures.
I can tell you that I know what they both pay now and for how long their terms are. And the years they bought their houses and that the houses are the exact same.

Oh and I know my sister is on .5% above ecb and her house definitely cost more than 350 and she didn't have a large deposit at all. In fact I loaned her some of the money to scrape it up. thats as much as I know. And my sisters was 20 years and my cousin's is 30.

If I was nosey enough I suppose I could find out how much my cousin's house cost, but I'm not that fussed.

Then it makes even less sense.

Let's say your sister's was 350k with 10% deposit, i.e. 315k mortgage amount and 0% interest for 20 years. The mortgage would be 1312.50.

In order to have a mortgage of 250 more than that at 1562.50 over 30 years at 4.5% you'd have to have a mortgaged amount of 308k, purchase price of 342 (10% deposit).

In order to have an actual significant saving on the first price, you'd need a much bigger disparity in interest rates or deposit rate.

jamesthepeach

Michael D Not Higgins wrote: »

Then it makes even less sense.

Let's say your sister's was 350k with 10% deposit, i.e. 315k mortgage amount and 0% interest for 20 years. The mortgage would be 1312.50.

In order to have a mortgage of 250 more than that at 1562.50 over 30 years at 4.5% you'd have to have a mortgaged amount of 308k, purchase price of 342 (10% deposit).

In order to have an actual significant saving on the first price, you'd need a much bigger disparity in interest rates or deposit rate.

Well those are the figures I was given. I think you are over analyzing with not enough info to do it.

You or I don't know both purchase prices for a start or lots of other variables. Hell I'm not even 100% sure of the term.of my cousin's mortgage.

If you don't believe it you don't believe it. They are two of the closest people.i have in my life so I believe them both.

I'm.sure they are not the only example of this.

Samuel T. Cogley

When do we think the optimal time to sell one beds will be (around CCish)? I just got off the phone with DNG and it's definitely higher than I thought and asking prices aren't reflective of what they're selling at. Personally I think Brexit is the next potential 'crash maker' so when are we likely to see the affects of that?

Realistically I need another 15-20% rise so I'm thinking 18 months?

Should I break this out to it's own thread?

jamesthepeach

Samuel T. Cogley wrote: »

When do we think the optimal time to sell one beds will be (around CCish)? I just got off the phone with DNG and it's definitely higher than I thought and asking prices aren't reflective of what they're selling at. Personally I think Brexit is the next potential 'crash maker' so when are we likely to see the affects of that?

Realistically I need another 15-20% rise so I'm thinking 18 months?

Should I break this out to it's own thread?

I just got a valuation way higher than I thought it was going to be. I'm seriously considering putting it on the market now. I have a second one that I was going to keep a little longer.
As I said in another thread I'm just getting out out of rentals. I was thinking airbnb but at the one bed sale prices at the moment screw airbnb even. The easy way out is to sell. And a way out is needed now. Renting out property has become a total mugs game.
The looks apartments in general have been shooting up the last few months.

Samuel T. Cogley

jamesthepeach wrote: »

I just got a valuation way higher than I thought it was going to be. I'm seriously considering putting it on the market now. I have a second one that I was going to keep a little longer.
As I said in another thread I'm just getting out out of rentals. I was thinking airbnb but at the one bed sale prices at the moment screw airbnb even. The easy way out is to sell. And a way out is needed now. Renting out property has become a total mugs game.
The looks apartments in general have been shooting up the last few months.

I was looking for that post to reply too, it's what made me ring DNG

VonLuck

rsynnott wrote: »

Oh, you're right, so it is. I just assumed from the names that it was that construction site on Hanover Quay right to the east. Okay, that's terrifying, then.

But it's in the SOBO district! http://www.sobo.ie/location/

Bob24

VonLuck wrote: »

But it's in the SOBO district! http://www.sobo.ie/location/

Half of what is marked as the "SOBO" district (never heard that before, is it a marketing name?) on that map is actually a huge block of social housing.

Not that I have anything against that, but the website which talks more about what is around it than what is in it is only slightly misleading about the area ;-)

AlmightyCushion

Bob24 wrote: »

Half of what is marked as the "SOBO" district (never heard that before, is it a marketing name?) on that map is actually a huge block of social housing.

Not that I have anything against that, but the website which talks more about what is around it than what is in it is only slightly misleading about the area ;-)

Never heard of it either. It's obviously trying to make the area sound hip and trendy by renaming it Sobo, which conviently sounds like Soho, a hip and trendy part of London. Looks like they're following the South Park school of marketing.

https://www.youtube.com/watch?v=miXMWJyOdgw

Bob24

Reminds me of the first time I heard of "central park" in Sandyford :-)

rsynnott

Bob24 wrote: »

Half of what is marked as the "SOBO" district (never heard that before, is it a marketing name?) on that map is actually a huge block of social housing.

Not that I have anything against that, but the website which talks more about what is around it than what is in it is only slightly misleading about the area ;-)

I used to live on the west side of 'SOBO' (cringe). It's okay, but it is not the sort of place I'd expect to see two beds going for >500k. A 2 bed in the modernish building I was renting in went for 350 or something last year, and I thought that was a bit excessive, to be honest.

Bob24

rsynnott wrote: »

I used to live on the west side of 'SOBO' (cringe). It's okay, but it is not the sort of place I'd expect to see two beds going for >500k. A 2 bed in the modernish building I was renting in went for 350 or something last year, and I thought that was a bit excessive, to be honest.

Yes the part closer to the city centre and the edges are OK. But the area next to Eurspar is so-so, I've seen a few dodgy things there and tend to avoid it at night. Pearse street or the quays are nicer and safer walk from town to the docklands area (although once a guy on a bike grabbed my phone from me as I was walking on the quays before heading to his base just in the middle of lovely SOBO).

dubrov

I used to rent in "SOBO" about 10 years ago.
It was great being so close to town but was definitely rougher than closer to town or Grand Canal on the other side.
There was a Spar(I think) there and the security guard was tormented by kids.

Maybe things have changed since then but I doubt it

The_Conductor

VonLuck wrote: »

But it's in the SOBO district! http://www.sobo.ie/location/

Sobo? What the hell is that?
Sensationally Obsessive Barmy Orbit.......

Has to be either IRES REIT or Hibernian REIT........

What a load of bollox- funny thing is- there are people out there who will rent/buy that cow manure.

Bob24

The_Conductor wrote: »

VonLuck wrote: »

But it's in the SOBO district! http://www.sobo.ie/location/

Sobo? What the hell is that?
Sensationally Obsessive Barmy Orbit.......

Has to be either IRES REIT or Hibernian REIT........

What a load of bollox- funny thing is- there are people out there who will rent/buy that cow manure.

SoBollocks maybe ;-) ... these marketing schemes are just ridiculous but I don't think people buy/rent there because they fall for it, more because they have no alternative.

jamesthepeach

Same thing happening now as in the naughties.
I know many people who would turn their noses up at a rough area. Now they are trying to convince themselves that a rough area is good so they can buy in it and not feel they live with scumbags they hate so much. Very same thing happened before.

No amount of marketing or blinkers is going to make that area less rough.

I always ask people one question when they start on about an area being much better than it was with a view to me saying oh yes you are right to buy there.
I say - would you want to bring your children up there?
That usually instigates some inner searching.

The_Conductor

Bob24 wrote: »

SoBollocks maybe ;-) ... these marketing schemes are just ridiculous but I don't think people buy/rent there because they fall for it, more because they have no alternative.

The older I get- the more cynical I become.
However cynical I've become- the company involved in defining the area as 'SOBO' (I'm not sure whether this is supposed to be capitalised, or not)- are even more cyncial than the more cynical of bystanders.

I'm all for 'gentrification' however- this is just bollox of the highest calibre- its not even gentrification- as its obviously trying to sell the area as for high calibre tenants, who don't have to mix with the riff-raff- other than perhaps as they are served their meals or drinks in local establishments..........

Yes- we need some high profile areas and reasonable housing if we're to encourage Brexit financial business over here- however, this is just taking the piss.

SOBO - So obviously bollox obstentation.

The_Conductor

jamesthepeach wrote: »

I say - would you want to bring your children up there? That usually instigates some inner searching.

Not in a million years- and I do have two young children- I wouldn't it fair on them, or safe.

quadrifoglio verde

I'm guessing the SOBO marketing team have never been in the windjammer :pac:

I'd happily live in the area, but I'd want my head examined to pay nearly 600K for a two bedroom apartment

jamesthepeach

I was keeping an eye on the few one bed apartments for sale in Dublin and they all seem to have disappeared off daft in the last few days.
Is the market sweeping up the lower end properties now?
It wasn't long ago you couldn't sell anything in The commuter counties. Now you can't get anything. The market is moving to the undesirables of last year now.

Sierra Oscar

<quote from banned poster snipped>

We aren't really seeing that though from a buy-to-let investment point of view. The number of small landlords is actually on the decline as people are fleeing the market.

Sure we're seeing a lot of people, especially first time buyers, chasing a small number of available properties. However I don't think it's comparable (yet) to the Celtic Tiger where you had every Tom, Dick and Harry looking to get into the buy-to-let market. People are looking to buy homes and that will always remain the case, there aren't as many people purchasing investment properties.

Bob24

Sierra Oscar wrote: »

We aren't really seeing that though from a buy-to-let investment point of view though. The number of small landlords is actually on the decline as people are fleeing the market.

Sure we're seeing a lot of people, especially first time buyers, chasing a small number of available properties. However I don't think it's comparable (yet) to the Celtic Tiger where you had every Tom, Dick and Harry looking to get into the buy-to-let market.

Yes, I would say the with the Celtic Tiger bubble prices were increasing because people were purchasing properties they didn't need, whereas currently prices are increasing because people are not able to purchase the properties they need.

Still a problem though ... as pushing people into excessive debt through organised shortages in order to match the price of a past bubble doesn't seem sensible to me.

Sierra Oscar

Bob24 wrote: »

Still a problem though ... as pushing people into excessive debt through organised shortages in order to match the price of a past bubble doesn't seem sensible to me.

Yes it's a massive problem, but the Central Bank rules are currently preventing people from getting into excessive debt.

The fact of the matter is that the people paying exorbitant prices for property at the moment can afford to do so. It's just that the average person is being priced out of the market, but that doesn't necessarily mean everyone who is buying property is mounting crippling debt on top of themselves.

I don't think it has dawned on a lot of people yet that they simply will never own their own homes if the current situation persists. There will always be people who are willing and can afford to pay prices for property which the rest of us find exorbitant - and in the process they are pricing the rest of us out of the market.

This problem will persist until the supply issue is sorted.

Cuddlesworth

Sierra Oscar wrote: »

Yes it's a massive problem, but the Central Bank rules are currently preventing people from getting into excessive debt.

The fact of the matter is that the people paying exorbitant prices for property at the moment can afford to do so. It's just that the average person is being priced out of the market, but that doesn't necessarily mean everyone who is buying property is mounting crippling debt on top of themselves.

I don't think it has dawned on a lot of people yet that they simply will never own their own homes if the current situation persists. There will always be people who are willing and can afford to pay prices for property which the rest of us find exorbitant - and in the process they are pricing the rest of us out of the market.

This problem will persist until the supply issue is sorted.

The banks are doing everything in their power to "help" people out and get around the CB restrictions. My fried recently purchased and was offered 6 months moratorium on payments. Which is handy for him to help pay back the deposit he obviously borrowed.

ThisRegard

Cuddlesworth wrote: »

The banks are doing everything in their power to "help" people out and get around the CB restrictions. My fried recently purchased and was offered 6 months moratorium on payments. Which is handy for him to help pay back the deposit he obviously borrowed.

All that does is either increase his subsequent payments, or lengthen his mortgage period. It's not really helping people out financially.

Glen_Quagmire

Cuddlesworth wrote:

The banks are doing everything in their power to "help" people out and get around the CB restrictions. My fried recently purchased and was offered 6 months moratorium on payments. Which is handy for him to help pay back the deposit he obviously borrowed.

What bank was that with?

B00MSTICK

Glen_Quagmire wrote:

What bank was that with?

AIB I guess - think they are the only ones doing it?

I'd prefer the 2-3% cashback offered by some of the other lenders but I guess if you are really skint and the repayments are high then the 6 months might be "better"

Taylor365

B00MSTICK wrote: »

AIB I guess - think they are the only ones doing it?

I'd prefer the 2-3% cashback offered by some of the other lenders but I guess if you are really skint and the repayments are high then the 6 months might be "better"

The cashback is another bit of a scam as such.

''Here, take this scrap of cash now, while we hold off on adjusting rates throughout the years...''

Or so I've been told!

Cuddlesworth

Taylor365 wrote: »

The cashback is another bit of a scam as such.

''Here, take this scrap of cash now, while we hold off on adjusting rates throughout the years...''

Or so I've been told!

Its just another method of getting around the deposit requirements. You only really need 7-8% deposit now, and some borrowed cash.

Samuel T. Cogley

Which is perfectly reasonable to be honest. The CB aren't there to regulate prices, but borrowing. 92% mortgages are fine if the consensus is we're in a rising market for the foreseeable future.

Bob24

Samuel T. Cogley wrote: »

Which is perfectly reasonable to be honest. The CB aren't there to regulate prices, but borrowing. 92% mortgages are fine if the consensus is we're in a rising market for the foreseeable future.

Well going around the borrowing regulations established by the CBI is undermining its power to do so. When they say maximum 90% LTV they are not regulating prices, they are defining what they consider a safe debt ratio (you can be sure if unsafe lending practices lead us to another banking crisis, all fingers will be pointed at the CBI for not regulating enough, even though many of the same people who would make them responsible are at the moment blaming them for regulating too much).

The_Conductor

Samuel T. Cogley wrote: »

Which is perfectly reasonable to be honest. The CB aren't there to regulate prices, but borrowing. 92% mortgages are fine if the consensus is we're in a rising market for the foreseeable future.

However, the fact of the matter is- there is no consensus.
The Dublin market- in particular its second hand market- has become divorced from both its new build market- and the rest of the country- and is stagnating. This is despite a chronic shortage- and a lack of family homes being built- where people want to live (and indeed, in their totality).

In this context- many commentators are suggesting that the second hand market in Dublin- is simply 18-24 months ahead of the second hand market elsewhere- however, on the back of government assistance, they expect the new market to remain buoyant.

Aka- despite a chronic shortage of housing- the only thing supporting the market is what is viewed by an increasing number of commentators as the irresponsible financial assistance the government are affording first-time-buyers of new builds.

I.e. we may need 25k units per annum and currently have ramped production up to perhaps 17,500 per annum- however, despite this mismatch between supply and demand- price increases (and any stability in the market) is contingent in continuing government intervention in favour of first-time-buyers.

Its not a healthy market- at all- I'm not clear what medicine it needs- time will tell whether, or not, an equilibrium will ever be met.

Will home owners, prospective purchasers and others- be satisfied with prices that may fall in the medium term- and how will lenders view this (esp. in light of very obvious naughtiness on the part of AIB- who are on the record shattering CB rules willy nilly to shovel money out the door).

I'm glad I don't have shares in any Irish banks- and I most certainly will not be buying AIB shares- as its entirely foreseeable that there is an ocean of hurt coming down the road, yet again.........

OfflerCrocGod

What rules have AIB shattered? As long as the LTI rule stays and is mostly enforced I don't see a bubble. What I see is lots of people putting family savings/loans down as deposits. That's their loss though not the banks. Unless we see at least a 15% drop in prices the banks won't be going bust. Who thinks prices will drop that much?

Samuel T. Cogley

Even if they do it's people own equity that's going in the main. I can't imagine there are that many getting away with (effective) 7% deposits and even if they are is 3% going to make a huge difference? I really can't see it being the difference between a healthy balance sheet and a collapse.

jamesthepeach

OfflerCrocGod wrote: »

What rules have AIB shattered? As long as the LTI rule stays and is mostly enforced I don't see a bubble. What I see is lots of people putting family savings/loans down as deposits. That's their loss though not the banks. Unless we see at least a 15% drop in prices the banks won't be going bust. Who thinks prices will drop that much?

Well I've never heard this before. Never, not even 12 or 13 years ago. No, never heard anyone speak like that.
Eeek.

On a serious note though.
If there is a crash noone will see it coming.
After it happens the world will be full of people who saw it coming and predicted it and saying the digs on the street knew it was coming.
Kind of like the amount of people that were at Woodstock.

Villa05

jamesthepeach wrote:

On a serious note though. If there is a crash noone will see it coming. After it happens the world will be full of people who saw it coming and predicted it and saying the digs on the street knew it was coming. Kind of like the amount of people that were at Woodstock.

A crash is inevitable the way the property market is being managed. If it were managed in a mature careful manner, damage could be minimised even eliminated. You reap what you sow and we are planning for maximum pain. Be prepared

jamesthepeach

Villa05 wrote: »

A crash is inevitable the way the property market is being managed. If it were managed in a mature careful manner, damage could be minimised even eliminated. You reap what you sow and we are planning for maximum pain. Be prepared

Agreed. My old man always told me to always be getting ready for the next recession. If you are doing that you can clean up when it happens. Advice I have followed and found to be excellent for the last 30 years.