Opinions on when the next property crash may happen

4ensic15

bmwguy wrote: »

What were the annual % price rises 2000-2007 can anyone remember?

.

Prices stalled at the end of 2002. The real lunacy was in the period 2003-2006. That was the period when the banks started chasing Anglo and bank of Scotland for market share and gave 100% loans. The market is now dependent on interest rates and the rate of provision of new buildings and the general economy. A rise in interest rates will force down prices as will an increase in the provision of new buildings.The strength of weakness of the general economy will amplify the trend. It will be quite some years before building reaches the point where there is a sufficient supply to bring down the market.

B00MSTICK

bubblypop wrote: »

I recently applied for mortgage approval, not a first time buyer & have a large deposit.
3 different banks, 3 different amounts, from 200k, 275k & 325k.
Same Central Bank rules?
Seems some rules can still be bent.
( all the above were an exemption to the 3.5 salary rule, but wildly different amounts)
If others are like me, that's got to be driving prices up

myshirt wrote:

You're likely on 70k plus for a single salary. That's the difference. They won't do it for lower incomes. So nothing too strange.

I could see it being the case if you were on >70k as a single applicant but does the bit I bolded above mean that the 200k was also an exemption to the 3.5 rule?

If so, I take it your salary would be <58k and one of the banks was offering over 5.5 times your salary? Do you have another guaranteed source of income?

You don't say how much your salary/deposit is and the 5.5 times salary is still a far cry from the 9 times salary mentioned previously but it does make you wonder...

Idbatterim

One thing that would make you a cynic. The banks take a big risk ( lending out way too much on overpriced property) the bet comes off they win, if it doesn't, the taxpayer will be there. That is absolutely true for boi and aib as systemic banks. IF the same **** happens as last time, the only difference I would see due to public outrage, would be that it wouldn't be a blanket guarantee... (covering any possible anglos etc)

Wanderer78

Idbatterim wrote:

One thing that would make you a cynic. The banks take a big risk ( lending out way too much on overpriced property) the bet comes off they win, if it doesn't, the taxpayer will be there. That is absolutely true for boi and aib as systemic banks. IF the same **** happens as last time, the only difference I would see due to public outrage, would be that it wouldn't be a blanket guarantee... (covering any possible anglos etc)

I suspect we 'll see more bank bail ins next time around, I wonder will that cause people to say, enough is enough?

sbsquarepants

Samuel T. Cogley wrote: »

Okay so c. €52K my figures where in Euro - I've also conflated median house prices with median 4 beds in Dublin. I'd have to review the figures but it looks like the multipliers are very similar.

There is no doubt the prices are not desirable - but does it mean there will be a crash - how does Dublin compare to a few of the others on that list?

Genuine questions I'm not sure I can be bothered to do the research on! :pac:

I'm not really sure what good comparisons to Melbourne or anywhere else for that matter are. Conditions in Melbourne have no impact on the price of a house in Dublin - conditions in Dublin and to a lesser extent the rest of the country are all that matter.

When it comes to buying a house (to live in as opposed to as an investment) most people do the same thing - how much money can I get my hands on, what and where can I get for that much money.
It's all well and good to look at it from afar and asses the value based on this factor or that factor, but the majority of people will just want a particular house or a particular area and then they will pay whatever is required up until they run out of money - that is the only real limiting factor. It was immediately apparent the last time the central bank relaxed the deposit rules - the price of houses jumped by a more or less matching amount within hours in some cases!
Investing is different - the end goal is to make money, buying to live in, the end goal is just getting to live in it.
If the state handed every man woman and child a million euros tomorrow - a 3 bed semi in glasnevin would suddenly be "worth" 3million the following day!

sbsquarepants

Idbatterim wrote: »

One thing that would make you a cynic. The banks take a big risk ( lending out way too much on overpriced property) the bet comes off they win, if it doesn't, the taxpayer will be there. That is absolutely true for boi and aib as systemic banks. IF the same **** happens as last time, the only difference I would see due to public outrage, would be that it wouldn't be a blanket guarantee... (covering any possible anglos etc)

Also - possibly straying into tin foil hat territory, but if you owned the bank (as the state does), rising house prices impact on your balance sheet nicely, with an eye towards a future sale.

Why exactly would the owner of the bank want house prices to fall or stay flat?

Samuel T. Cogley

sbsquarepants wrote: »

I'm not really sure what good comparisons to Melbourne or anywhere else for that matter are. Conditions in Melbourne have no impact on the price of a house in Dublin - conditions in Dublin and to a lesser extent the rest of the country are all that matter.

On the one hand I agree, Dublin is Dublin - we have our own factors, but this comparison was off the back of the economic output rankings as I can't think of a better comparison as when we pick other cities someone always throws up X or Y objection.

sbsquarepants wrote: »

When it comes to buying a house (to live in as opposed to as an investment) most people do the same thing - how much money can I get my hands on, what and where can I get for that much money.
It's all well and good to look at it from afar and asses the value based on this factor or that factor, but the majority of people will just want a particular house or a particular area and then they will pay whatever is required up until they run out of money - that is the only real limiting factor. It was immediately apparent the last time the central bank relaxed the deposit rules - the price of houses jumped by a more or less matching amount within hours in some cases!
Investing is different - the end goal is to make money, buying to live in, the end goal is just getting to live in it.
If the state handed every man woman and child a million euros tomorrow - a 3 bed semi in glasnevin would suddenly be "worth" 3million the following day!

Deposits caused pricies to jump becuase there was more competition - it's not necessarily a bad thing given the amount people would have been paying in rent. It's not the job of the CB to regualte house prices just control lendling. If they sense a correction coming they absolutely should increase deposits for no other reason than to protect equity in property.

sbsquarepants

Samuel T. Cogley wrote: »

On the one hand I agree, Dublin is Dublin - we have our own factors, but this comparison was off the back of the economic output rankings as I can't think of a better comparison as when we pick other cities someone always throws up X or Y objection..

As comparisons go I suppose it's not the worst, I'm just not sure any comparisons really tell us anything - as the old saying goes location, location, location - what exactly can a house on the far side of the world tell you about one next door to you? The answer is very little in my opinion.
It's not like too many people could just opt for one over the other, even if it seemed like considerably better value!

Samuel T. Cogley wrote: »

Deposits caused pricies to jump becuase there was more competition - it's not necessarily a bad thing given the amount people would have been paying in rent. It's not the job of the CB to regualte house prices just control lendling. If they sense a correction coming they absolutely should increase deposits for no other reason than to protect equity in property.

It's not necessarily good or bad - for every house bought, there is by necessity a house sold so it's kind of swings and roundabouts overall.
But it just illustrates my point - in an lot of cases, people will just spend as much as they can get. The reason I bought the house I did, was because that's what I could "afford". If the bank would have loaned me another 50, 100k or whatever, odds are I just would have bought a bigger and better house.
If they would have loaned everyone another 50 or 100k, I would most likely have just ended up buying the house I did for 100k more.

Anongeneric

Samuel T. Cogley wrote: »

On the one hand I agree, Dublin is Dublin - we have our own factors, but this comparison was off the back of the economic output rankings as I can't think of a better comparison as when we pick other cities someone always throws up X or Y objection.


I'm too lazy to find the post but I think it was you who posted about median prices in Melbourne??

This isn't a 'I told you so' post, I just remember being at Kilkenomics either last year or the year before listening to an Australian economist,(can't remember his name), who said more or less everything that is in this article.

Thought you may be interested in reading it.

https://www.theguardian.com/australia-news/2017/may/03/eye-watering-prices-australias-housing-affordability-crisis-laid-bare

Samuel T. Cogley

[QUOTE=Anongeneric;103397904I'm too lazy to find the post but I think it was you who posted about median prices in Melbourne??

This isn't a 'I told you so' post, I just remember being at Kilkenomics either last year or the year before listening to an Australian economist,(can't remember his name), who said more or less everything that is in this article.

Thought you may be interested in reading it.

https://www.theguardian.com/australia-news/2017/may/03/eye-watering-prices-australias-housing-affordability-crisis-laid-bare[/QUOTE]

On the back of another post placing it directly next to us in economic output. I've previously compared to the likes of Manchester and Oxfordshire.

draiochtanois

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Henry Ford III

I've only a passing interest in this but could anyone post the average income and average house sales prices please?

I suspect the ratio has crept up a bit, and if it's maybe 5+ x income then I reckon a correction will happen soon enough.

pilly

draiochtanois wrote:

This post has been deleted.

How do you reckon it costs 195k? I've been told 90k?

Anongeneric

Median House prices in Dublin are 425,000euro
Average salary 50,000, median 35,000

THough I stand to be corrected, those figures are from memory

In response to Henry Ford

Samuel T. Cogley

draiochtanois wrote: »

This post has been deleted.

Firstly with a few feet of garden that is a perfectly reasonable size, IMHO. There seems to be an alarming number of people who seem to think anything under 2000sq ft. is unsuitable for a family, and fair enough - but move to Wexford.

Samuel T. Cogley

Anongeneric wrote: »

Median House prices in Dublin are 425,000euro
Average salary 50,000, median 35,000

THough I stand to be corrected, those figures are from memory

In response to Henry Ford

No where near that on house prices. But to be fair I think I got that figure into the thread by conflation.

https://www.daft.ie/report/2017-Q1-hp-daft-report.pdf

Anongeneric

Samuel T. Cogley wrote: »

No where near that on house prices. But to be fair I think I got that figure into the thread by conflation.

https://www.daft.ie/report/2017-Q1-hp-daft-report.pdf

I was going with Dublin prices not the whole country.
And unless I'm reading it wrong, I think this backs it up
Highest SCD, 548,808 to a low in 282,451 in CC??

Are you saying higher or lower?

Samuel T. Cogley

Anongeneric wrote: »

I was going with Dublin prices not the whole country.
And unless I'm reading it wrong, I think this backs it up
Highest SCD, 548,808 to a low in 282,451 in CC??

Are you saying higher or lower?

The majoroty of Dublin housing is not in SCD, so that figure wont bring the others to 450K.

PokeHerKing

The average is 250K for a Dublin house. Average wage is 35K. Joint application is 70K. Which is 3.5 X income.

PokeHerKing

pilly wrote:

How do you reckon it costs 195k? I've been told 90k?

How long is a piece of string...

Size, finishing's, location etc..

pilly

PokeHerKing wrote: »

How long is a piece of string...

Size, finishing's, location etc..

Yeah but I'm talking about leaving out the location because the poster said that was the cost without the land.

Cost of building doesn't vary by 100k due to finish.

Anongeneric

Samuel T. Cogley wrote: »

The majoroty of Dublin housing is not in SCD, so that figure wont bring the others to 450K.

Sorry I was looking at a 4 bed semi, which is according to myhome.ie property report 2016, 425 euro
3 bed 328 euro

Geuze

PokeHerKing wrote: »

The average is 250K for a Dublin house. Average wage is 35K. Joint application is 70K. Which is 3.5 X income.

2015 earnings data

Average FT earnings = 45,075

Average earnings = 36k approx

Geuze

pilly wrote: »

How do you reckon it costs 195k? I've been told 90k?

2012 report for IHBA

http://www.walsh-associates.ie/wordpress/wp-content/uploads/2014/06/Report-On-Construction-Cost-of-3-Bedroomed-Semi-Detached-House-31-May-2012.pdf

House + ext works+ site dev works = 129,674

Add other costs = 197,080

This excludes 13.5% VAT, and excludes land costs, but includes profit.

athtrasna

Maybe start a new thread or continue this conversation on the property market thread, rather than derail this one.

Thanks

Mod

Geuze

PokeHerKing wrote: »

Average wage is 35K. Joint application is 70K. Which is 3.5 X income.

Average FT earnings in 2015 = 45,075

Average incomes from 2015 SILC:

http://www.cso.ie/en/releasesandpublications/er/silc/surveyonincomeandlivingconditions2015/

Mean household gross = 58,501
Mean household disposable = 45,293


Median household income

Gross = 43,015
Disposable = 37,741

PokeHerKing

Geuze wrote:

Gross = 43,015 Disposable = 37,741

Geuze wrote:

Median household income

Geuze wrote:

Mean household gross = 58,501 Mean household disposable = 45,293

Geuze wrote:

Average incomes from 2015 SILC:

Geuze wrote:

Average FT earnings in 2015 = 45,075

My figures were fairly loose. We're not far off 3.5X income/house prices was my point.

Factor in big deposits and we're closer still I reckon.

lawred2

pilly wrote: »

How do you reckon it costs 195k? I've been told 90k?

90k? Told by whom?

Samuel T. Cogley

lawred2 wrote: »

90k? Told by whom?

Jimmy the builder giving them a quote they had very little intention on sticking too perhaps? :pac:

draiochtanois

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