Opinions on when the next property crash may happen

LirW

Samuel T. Cogley wrote: »

Why are perfectly sensible posts always ruined by people thinking we'll be in self-driving cars and dealing with robots in coffee shops, retailers and call centres.

I always put it like that: on the one hand we're flying to the Mars, on the other it takes an eternity that vending machines accept the new 10 Euro bills.
That gives me comfort then.

pilly

Samuel T. Cogley wrote: »

Why are perfectly sensible posts always ruined by people thinking we'll be in self-driving cars and dealing with robots in coffee shops, retailers and call centres.

Tbf we're already dealing with robots in retailers and banks Samuel, it's not too far a stretch.

I remember 2 years ago advising a member of staff in BOI who was being an asshole insisting that people use the machines that they would be doing themselves out of a job and indeed they are.

Samuel T. Cogley

pilly wrote: »

Tbf we're already dealing with robots in retailers and banks Samuel, it's not too far a stretch.

I remember 2 years ago advising a member of staff in BOI who was being an asshole insisting that people use the machines that they would be doing themselves out of a job and indeed they are.

This technology has been available for donkey's years. It's a very slow adoption process. 5 years for significant losses of jobs in service is not going to happen.

pilly

Samuel T. Cogley wrote: »

This technology has been available for donkey's years. It's a very slow adoption process. 5 years for significant losses of jobs in service is not going to happen.

It's already happening. There's no adoption process about it, it's either use machines now or tough luck.

Samuel T. Cogley

pilly wrote: »

It's already happening. There's no adoption process about it, it's either use machines now or tough luck.

:rolleyes:

How many robot staff do you deal with in Marks and Spencer? How many robots (not on the initial menus) do you deal with in call centres?

You're talking about a few less tellers in banks and a few less staff at checkouts. That's not going to cause a crash. What would cause a crash is ten of thousands of people laid off - which actually is possible even now - but the technophiles always underestimate the other factors.

Yourself isit

LirW wrote: »

I always put it like that: on the one hand we're flying to the Mars, on the other it takes an eternity that vending machines accept the new 10 Euro bills.
That gives me comfort then.

We are nowhere near AI.

Yourself isit

So back to housing. In the medium term we could easily have a fall in prices. Property is in fact being built and the political pressure is such that the government will be forced to encourage supply. Unlike 2006 the issue now isn't that people are getting a 400k house on social welfare (true story) but that rent and house prices are out of whack for most people. Like it or not there will be pressure to increase supply which is code for reducing prices.

That's a head wind against increased prices.

Supply is often inelastic in the early stages of a bust, say we build the 2-3k houses p/m we need to catch up with pent up demand but once demand is satisfied we need only 1-2k: for months or years after the higher supply will still come online (although second hand house sales are elastic to price do that's a mitigating factor) which leads to oversupply.

Then Ireland has the amplifiers of the demographics. Favourable in a boom, very unfavourable in a recession.

We are amplifying our business cycles. Basically.

PMBC

SeanSouth wrote: »

Crashes only happen when there is an over-supply of houses and no demand.

At the moment we have the opposite, Much demand and no supply. There's no
crashes on the horizon but there are increasing amounts of people with no houses
so the situation will get a lot worse before it gets a lot better

What needs to happen to correct the current situation is for more houses to be built. But here's the problem. The problem arises because all new houses must be A rated Rolls Royce and not D rated Ford Focus as most of the existing housing stock is. If the builder builds a high standard Rolls Royce as is required by the building regulations, he wont be able to achieve enough margin to make it worthwhile. So there is a stalemate. The fact that the government is insisting on taking 13.5% vat on top and the local authority and Irish water are clawing in excessive levies to feather their own nests means that its just not feasable to build.

The government wont withdraw the levies or taxes because some clever civil
servant has said that the money will go to the builders instead. The civil servant
is absolutely right however this is irrelevant as the main objective is to get
the houses built. Market forces and finance restrictions will keep the prices under
control. The developer wont build unless he can sell within the 1st time buyer's affordability level

A crash cant happen unless there is some 'air' between the cost of building and the price of the house. There is no 'air' at the moment. To build a 3 bed semi detached house in Dublin costs around 400,000 on average depending on the area. The maths dont work.

Here's what the government needs to do to get building moving

1) All taxes, levies and local authority charges need to be abolished for
new builds in Dublin Cork, Limerick and Galway for a finite period of five years.
The five year stipulation will draw out builders in force and we will get houses
built quickly and where they are needed.
2) Building Regulations need to be relaxed so that, not only A rating houses are
allowed but also B rating and C rating too. A, C rated house is still a very fine house but is much cheaper and more affordable
3) The planning system needs to be dragged into the new millenium and the
old inflexible and archaic system needs to be abolished

Are you aware that Energy effectiveness is about to be increased with the introduction of nZEB - near zero energy input in a few years time. Locla Authorities levis are to cover roads, parking etc. Perhaps you can show they are overpriced.

Graham

Yourself isit wrote: »

say we build the 2-3k houses p/m we need to catch up with pent up demand but once demand is satisfied we need only 1-2k: for months or years after the higher supply will still come online (although second hand house sales are elastic to price do that's a mitigating factor) which leads to oversupply.

We have approaching 10 years worth of demand to catch up on, this is likely to have a maintaining or upward influence on pricing for some time to come.

Some supply could find its way to the market as a result of the following, but it will take time:

End of the 7yr break for CAT relief.
Banks finally reposessing properties, returning houses to the market.
Completion of the (very few) remaining ghost estates.
Government proposal to release land for construction.

daveharnett

Samuel T. Cogley wrote: »

How many robot staff do you deal with in Marks and Spencer?

I do my grocery shopping with the tesco.ie robot, but even in bricks-and-mortar, they are everywhere:

When this https://www.youtube.com/watch?v=NrmMk1Myrxc gets rolling, department stores will be adopting robo-checkout too.

Samuel T. Cogley wrote: »

What would cause a crash is ten of thousands of people laid off - which actually is possible even now - but the technophiles always underestimate the other factors.

I expect that the drivers of most/all of Ireland's taxis, trucks, buses and trains will be made redundant by robots in the 2020s. Sure, there are confounding factors, but the economic incentives will crush them.

daveharnett

morrga wrote: »

Dublin relative to most other first world cities is at the lower end of the scale in terms of property cost.

morrga wrote: »

London, Paris, New York, Sydney I was more thinking.

Dublin 1.35 million people, 1400 people per sq km.
London 8.65 million people, 5500 people per sq km.
Paris 2.25 million people, 21000 people per sq km.
NYC 8.5 million people, 11000 people per sq km.

It seems pretty clear that dublin should not compare to these cities for price.

Phoenix 1.35 million people, 1100 people per sq km. Average home value $210k.

bricky06

PMBC wrote: »

Local Authorities levis are to cover roads, parking etc.

I thought they were to cover their backsides

Samuel T. Cogley

daveharnett wrote: »

I do my grocery shopping with the tesco.ie robot, but even in bricks-and-mortar, they are everywhere

When this https://www.youtube.com/watch?v=NrmMk1Myrxc gets rolling, department stores will be adopting robo-checkout too.


I expect that the drivers of most/all of Ireland's taxis, trucks, buses and trains will be made redundant by robots in the 2020s. Sure, there are confounding factors, but the economic incentives will crush them.

Do you remember the huge layoff from Tesco when they were introduced? No me either - the staff were redeployed picking stuff up for those of us who are too lazy to even go into the shop. Ever seen Johnnie 5 stacking the shelves in there?

Self driving cars are a pipe dream. Maybe, just Maybe we'll see them in 20 years but good vehicles, PSV etc. will all be manned. The technology to fly aircraft automatically has been there for years - you still have pilots.

There are a huge number of issues beyond the technology being there.

daveharnett

Samuel T. Cogley wrote: »

Do you remember the huge layoff from Tesco when they were introduced?

No, the jobs were lost from Quinnsworth, SuperValue, Mom&Pop, who were outcompeted by tesco, with it's greater economies of scale, and lower staff count per customer served.

Samuel T. Cogley wrote: »

Self driving cars are a pipe dream. Maybe, just Maybe we'll see them in 20 years but good vehicles, PSV etc. will all be manned. The technology to fly aircraft automatically has been there for years - you still have pilots.

Planes don't have the same economic pressure to (100%) automate.
- The cost of 2/4 pilots per trip is negligible next to the fuel and capital costs. Nobody is rushing to build automated container ships either, even though the world's big docks are run by robots.
- Passengers (wrongly) consider plane travel to be particularly dangerous, and could abandon the first carrier to introduce self-flying planes, even if they pass the 2-5% savings on to the customer.

Compared to this, driver labor is a huge portion (50-80%?)of the cost of moving a container load of products from dublin port to your local supermarket.

Tesla are announcing their first semi/artic truck this Autumn, and they're already selling cars with self-driving-ready hardware.

Anongeneric

Blue collar one example:
Transport will be entirely automated within 20 years or less.
As soon as it is proven to be safer than people, insurers governments regulatory bodies etc will insist on it.

RFID technology has already done away with huge numbers of staff by negating the need for warehouse staff to scan products into stock, Walmart are the biggest example of this and reckon it will save them about 6billion a year worldwide.That's pretty much 6 billion saved from staffing costs.

Tesco et al have less tellers because we can scan and pay on our own

White collar:
Banks have already laid off plenty of staff as a result of the machines

The larger international legal firms are now rolling out,(albeit at the nascent stage now), software that will do away with about 90% of paralegal staff and support staff.

We're not there on an acceptance level yet, but computers can now diagnose with a higher level of accuracy than human doctors.


The people talking about these issues are generally sociologists, anthropologists and other social scientists, they have nothing to gain by scaremongering.

Samuel T. Cogley wrote: »

:rolleyes:

How many robot staff do you deal with in Marks and Spencer? How many robots (not on the initial menus) do you deal with in call centres?

You're talking about a few less tellers in banks and a few less staff at checkouts. That's not going to cause a crash. What would cause a crash is ten of thousands of people laid off - which actually is possible even now - but the technophiles always underestimate the other factors.

Samuel T. Cogley

Lads, these threads have been going on for years - it's simply not going to happen. Certainly NOT to the point of a crash. But look at it, we'll see.

On the transport though - Not a chance we will see self drive in the near future. The technology is there - the public will is not. This argument has been repeated over and over, the first one I remember is CD-ROM in tax law - took absolutely years before the uptake for law reports 'online' in that sector to be adopted despite the massive advantages and technology being present.

Transport automation is simply not going to cause a property crash, and certainly not the next one. Might cause a few car crashes though.

Cyrus

ive lost the thread of what people are trying to say anyway? automation will make us all redundant and therefore house prices will crash?

Samuel T. Cogley

Cyrus wrote: »

ive lost the thread of what people are trying to say anyway? automation will make us all redundant and therefore house prices will crash?

Just working class people from what I can gather.

LirW

Samuel T. Cogley wrote: »

Just working class people from what I can gather.

If this wave of automation is coming and lots of people are losing their jobs who spend years on earing a degree they can at least use the paper to dry their tears when they are out-earned by trades people :pac:
Maybe that's the point where Finglas and Coolock become the posh parts of Dublin.

Samuel T. Cogley

LirW wrote: »

If this wave of automation is coming and lots of people are losing their jobs who spend years on earing a degree they can at least use the paper to dry their tears when they are out-earned by trades people :pac:
Maybe that's the point where Finglas and Coolock become the posh parts of Dublin.

Nah, robots will be doing the internal work and houses will just be 3D printed. Inside 12 months.

Cyrus

Samuel T. Cogley wrote: »

Just working class people from what I can gather.

in the next 12-24 months

wow

LirW

Beware, within the next 36 months the houses in Finglas South that are sitting on the market for months now will be selling for Millions... MILLIONS, mark my words!

conorhal

morrga wrote: »

Dublin relative to most other first world cities is at the lower end of the scale in terms of property cost. As the economy grows and stabilises who's to say there will be any short to medium term crash. Reckless lending and naieve borrowing created the last crash world wide. Banks are stress tested more than ever now. From what I hear, CBI are demanding more and more regulatory reporting from financial institutions. This is exactly the structure the lending and property sectors need to ensure an incrementally growth phase rather than the crash and boom policies of years gone by.

People seem to think that spiralling house prices means people are borrowing beyond their means again. This is not necessarily true. The population is growing, jobs are growing, salaries are growing and people who want to live in urban areas can afford to, while those who cant are unfortunately been squeezed out.

There is no telling what the future holds but as an economy we should be hoping for stability rather than trying to predict downturns.

Then the question becomes , where IS the debt being assumed to pay unsustainable price rises if not by overburdened mortgage payers?
The answer to that may well be, by the government through various schemes like rent allowance etc. Combine an economic crash with the financial supports paying rents for people becoming unsustainable and the net effect could be a catastrophic social collapse.

Anongeneric

LirW wrote: »

Beware, within the next 36 months the houses in Finglas South that are sitting on the market for months now will be selling for Millions... MILLIONS, mark my words!

100% correct, sure you'd be mad not to borrow up to your bollix and buy today,
get on that ladder, buy a starter home.

Sure what could possibly go wrong with putting yourself a quarter of a million in debt for a temporarily inflated asset??
I can't think of any example in the last 9 years of that ever happening

Samuel T. Cogley

LirW wrote: »

Beware, within the next 36 months the houses in Finglas South that are sitting on the market for months now will be selling for Millions... MILLIONS, mark my words!

It won't matter where you live as the car will just drive you in with no traffic as it will all be controlled by Skynet.

LirW

Pffff I'm flying to work with my self-flying drone.

draiochtanois

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Idbatterim

so, regarding the topic, is still a good investment to buy an apt in Dublin with prevision to live here for other 3-5 years?

I am thinking at worst scenario, where you buy an house, you want to sell in 5 years, but the price are down so you cannot sell and you cannot move country as you will get lower salary outside ireland..

yes I would say so, if the alternative is the extortionate market rent! Put it this way, if you are in a position to buy now, say you continue renting for 1 year at 1,500 month, so you are now down E18,000. Say property prices increase 10%, and the property is a lowly enough 300,000 for Dublin. So you have lost, 30k, the rent and the extra interest you will be charged on the mortgage, you could be looking at a loss of 55k a year over the next 2 - 3 years at least in my opinion... Thats a very simple calculation, not taking into account compounding increases in rent, house prices etc!

I read an article the other day, saying how people are now returning in their droves from overseas and dont need mortgages at all or only tiny ones if they do...

Major numbers of housing completions for Dublin are years away! What is coming on stream at the moment, is a drop in the ocean, the problem is compounding, hence the escalating prices!

Samuel T. Cogley

draiochtanois wrote: »

This post has been deleted.

Thank you, seriously, for getting us back on topic, but what is that exactly?

draiochtanois

This post has been deleted.