Will house prices ever stop growing?

johnnyskeleton

LiamoSail wrote: »

NAMA isn't an estate agent or developer. They don't have the resources or expertise to sell to individuals. It's not their purpose

Exactly. Its purpose was to distort the property market so that people could not afford to buy houses/apartments.

Right2Write

KyussBeeshop wrote: »

The prices will grow to match the money available (through savings + debt) for the limited supply - the previous crisis shows that the tipping point is only the availability of money/debt, not the buyers late-onset rationality about it being overpriced.

If the average person wont buy at the inflated prices, there are a lot of other investors looking to take advantage of the high rents, who'll snap property up at whatever price, and add it to their portfolio.

Essentially we have a property market whose purpose is heavily distorted towards investment rather than living, right now - these two purposes rarely ever mix well.

Perhaps but regardless of whether people are buying property as a home to live in or as an investment property, there are limits to people's openness to risk. People's perception of risk is affected by many factors but there is no doubt a strong herd mentality. And once the herd gets nervous..

it stampedes. And if it chooses to run off a cliff, personally I don't think it's the state's job to head them off. From which you may gather, I have very little time for property speculators and gamblers. Let them reap what they sow and bankrupt them. Close thine ears to all the whining about their 'pensions' etc.

q85dw7osi4lebg

Caliden wrote: »

What sort of rate do you go on after the fixed rate?

The variable rate, at which point you can fix again or move to another provider.

q85dw7osi4lebg

koheim wrote: »

sorry, but even fixed rates are completely uncompetitive in a European perspective. It is shocking that the Irish Banks can get away with rates 50 to 100% over the European average!! (even if they are fixed).

We already bailed the banks out, now they are absolutely fleecing us. Also, with lower interest the housing market will become more affordable.

I agree that Irish banks aren't competitive at all in European terms.

I'm only stating BOI versus other Irish banks. We fixed a 90% LTV with BOI for less than any other bank recently. Excluding their trivial cash back offers etc.

Wombatman

Note global dip in 2008 after period of strong growth. It will come. The big question is when.

Ireland - volatility city.



World - flattening in many countries of late.

padser

KyussBeeshop wrote: »

The private market will not, and has no interest by the looks of it, in even trying to match those two numbers - because it's too lucrative to deliberately keep the number of houses undersupplied.

Ah yes, the dastardly "private market".

Not a collection of individuals trying to make money by building houses, but rather a nefarious, shady underworld that meet up every quarter to decide exactly how many houses to build in order to keep the market under-supplied.

It's pretty impressive really that each of them abide by the decisions made at those quarterly meetings. Because, of course, if just a few of them decided to cash in on the opportunity by building more houses....they would make a pile of cash..........but then again that's not the type of thing the "private market" would be interested in.

Graham

padser wrote: »

Not a collection of individuals trying to make money by building houses, but rather a nefarious, shady underworld that meet up every quarter to decide exactly how many houses to build in order to keep the market under-supplied.

There's more than a few that subscribe to that particular theory.

maninasia

Arthur Daley wrote: »

Not too long ago - 4/5 years - since people were wondering if prices would ever recover. Living through the last 20 years I really wonder if most people, most public/media comment anyway is operating at the intellectual level of a goldfish.

It's an interesting comment. The situation in Ireland is very extreme though. Ireland had the biggest housing bust of any developed country and the fastest recovery of any developed nation.

We have had huge inflows of people, then outdliws and inflow and outflows at the same time.

One could have predicted that Ireland's property market would recover but nobody could have predicted that prices would rocket so fast.

Thats mostly due to flawed NAMA policies and greedy and inept politicians and stupid and outdated planning laws along with a genuine strong and well managed economic recovery.

One would have thought that lessons would have been learned about turning prooerty into a national quick rich scheme but it seems that Ireland didn't learn anything and that suits a lot of people who are homeowners already. It's quite sad to see as well for emigrants as itakes it difficult for us toove back too. Either the jobsarent there or living costs and property is horrifically expensive. Really really disappointing to see this happen again!

maninasia

Graham wrote: »

KyussBeeshop wrote: »

The private market will not, and has no interest by the looks of it, in even trying to match those two numbers - because it's too lucrative to deliberately keep the number of houses undersupplied.

I don't buy that for a second. All things being equal, if a developer thought they could churn out double or triple the number of houses in the current market and make a reasonable level of profit you can bet your life they would.

The truth is somewhere in the middle. I heard that some developers assemble large land banks and will wait and wait for years for prices to rise then sell on the sites with planning permission or develop in a controlled manner over time. AFAIK there is no penalty for land hoarding at present.

Idbatterim

I don't buy that for a second. All things being equal, if a developer thought they could churn out double or triple the number of houses in the current market and make a reasonable level of profit you can bet your life they would.

it seems cairn homes is the only developer looking to ramp up supply of units at the moment...

One would have thought that lessons would have been learned about turning prooerty into a national quick rich scheme but it seems that Ireland didn't learn anything and that suits a lot of people who are homeowners already. It's quite sad to see as well for emigrants as itakes it difficult for us toove back too. Either the jobsarent there or living costs and property is horrifically expensive. Really really disappointing to see this happen again!

property prices are running away, but the big difference this time is, wages are not! Even if you get a pay rise over half of it will likely go back to those snakes in government! if you earn over 34k anyway, and if you don't, you probably wont be buying any time soon anyway!

I understand why all of these vested interest do what they do, but it is morally corrupt and disgusting and I aim that statement primarily at central and local government... These scum bags that WE elect to represent US the people!

what a "game changer" its going to be for me, when I get a USC cut worth about a fiver a week in this years budget oh then next several years, from these pathetic one trick ponies. Power at any cost!

maninasia

I'd love to move back fir a while but the cost of housing keep accelerating higher in Ireland while taxes are really high.

Between higher income taxes and rent it would cost me 20,000 to 30,000 euro more per year to live in Ireland, that is if I managed to find an equivalent wage which is NOT guaranteed.
Ireland is so unstable , I probably blew my brief window (literally 3 or 4 years) to move home.
The outrageous rents make it hard to save to buy a house , I also don't have the cash to just buy a property. Not all emigrants have stacks of cash.

I think property prices will keep going up for at least 5 years too....Dublin is getting more and more financial and IT industry ivestment driving up costs, unfortunately that's where most of the jobs are...

For a lot of emigrants like me we'd be delighted to try other places in Ireland if there are more investments there and cheaper housing...let's hope that happens. I'm thinking the South East could be a good option and Cork area.

Idbatterim

in relation to the above post, its now my friends all employed, never unemployed, on quite decent salaries are looking at getting out of this banana republic!

The cost of putting a roof over your head here just swallows up so much of your income! And its becoming a greater percentage all of the time for most people!

Wanderer78

Idbatterim wrote: »

in relation to the above post, its now my friends all employed, never unemployed, on quite decent salaries are looking at getting out of this banana republic!

The cost of putting a roof over your head here just swallows up so much of your income! And its becoming a greater percentage all of the time for most people!

theres many researchers showing that this is a very common issue across the world, we cant keep going on like this

Idbatterim

theres many researchers showing that this is a very common issue across the world, we cant keep going on like this

I agree and I don't think anything will be done about it until people rise up and say enough is enough. This cant go on! look at the commotion on water charges, and people wont march over this, which is destroying lives! Its probably what will need to happen here, the establishment don't budge on any issue, until they can no longer resist change...

knipex

Idbatterim wrote: »

in relation to the above post, its now my friends all employed, never unemployed, on quite decent salaries are looking at getting out of this banana republic!

The cost of putting a roof over your head here just swallows up so much of your income! And its becoming a greater percentage all of the time for most people!

I call BULLsh1t

My first full time job 25% of my gross pay, not take home, gross.. went on rent sharing a 3 bed semi with 4 others..

Rent was all-ways expensive but we used to put 5 people sharing a 3 bed, or stay in a crappy bedsit. People expect higher standards now but they complain when they have to pay for it.

My father get his mortgage back in the early 70's. he remembers paying 13% interest. he did it but he didn't go out every weekend, or have multiple TV's or sub holidays or any of the stuff people appear to think they are entitled to now.

I have a wife 2 kids, when we started saving for our house and got a mortgage we cut back, meals out became a treat, nights in a pub a rarity, fancy holidays non existent. sky sports a thing of the past. When we had kids we cut back more..

Now I see people who complain they cannot afford their mortgage but can have 2 weeks in the sun and sky sports, and Saturday night in the pub like they are a basic human right..

To listen to some of this generation you would swear that no one ever struggled or gave stuff up to afford a home.

Life is tough........ No one owes you anything............ grow up ................

Wanderer78

knipex wrote:

Life is tough........ No one owes you anything............ grow up ................

Tons of research out there showing the rise of private debt globally over the last few decades, a large proportion of it on the cost of housing.

Idbatterim

I have a wife 2 kids, when we started saving for our house and got a mortgage we cut back, meals out became a treat, nights in a pub a rarity, fancy holidays non existent. sky sports a thing of the past. When we had kids we cut back more..

the rate at which prices are increasing in dublin, is a multiple of any reasonable savings people could achieve by being more frugal.

Also whether they were more affordable now or then and I come across endless articles irish and from abroad, saying property as wandered78 has in general never been more unaffordable...

I think its time people started questioning why they should have to face an every decreasing quality of life or for example, why did you have to struggle so much to buy a home?

So the bloody banks, speculators and government can have their pound of flesh for 30 years?

Yourself isit

knipex wrote: »

I call BULLsh1t

My first full time job 25% of my gross pay, not take home, gross.. went on rent sharing a 3 bed semi with 4 others..

Rent was all-ways expensive but we used to put 5 people sharing a 3 bed, or stay in a crappy bedsit. People expect higher standards now but they complain when they have to pay for it.

My father get his mortgage back in the early 70's. he remembers paying 13% interest. he did it but he didn't go out every weekend, or have multiple TV's or sub holidays or any of the stuff people appear to think they are entitled to now.

I have a wife 2 kids, when we started saving for our house and got a mortgage we cut back, meals out became a treat, nights in a pub a rarity, fancy holidays non existent. sky sports a thing of the past. When we had kids we cut back more..

Now I see people who complain they cannot afford their mortgage but can have 2 weeks in the sun and sky sports, and Saturday night in the pub like they are a basic human right..

To listen to some of this generation you would swear that no one ever struggled or gave stuff up to afford a home.

Life is tough........ No one owes you anything............ grow up ................

Ah the old privileged generations god love them.

Samuel T. Cogley

knipex wrote: »

I call BULLsh1t

My first full time job 25% of my gross pay, not take home, gross.. went on rent sharing a 3 bed semi with 4 others..

Rent was all-ways expensive but we used to put 5 people sharing a 3 bed, or stay in a crappy bedsit. People expect higher standards now but they complain when they have to pay for it.

My father get his mortgage back in the early 70's. he remembers paying 13% interest. he did it but he didn't go out every weekend, or have multiple TV's or sub holidays or any of the stuff people appear to think they are entitled to now.

I have a wife 2 kids, when we started saving for our house and got a mortgage we cut back, meals out became a treat, nights in a pub a rarity, fancy holidays non existent. sky sports a thing of the past. When we had kids we cut back more..

Now I see people who complain they cannot afford their mortgage but can have 2 weeks in the sun and sky sports, and Saturday night in the pub like they are a basic human right..

To listen to some of this generation you would swear that no one ever struggled or gave stuff up to afford a home.

Life is tough........ No one owes you anything............ grow up ................

In fairness did you mother work and bring in the same income as your father in the 70s? In most households now both partners work a higher standard is therefore expected and rightly so IMHO. Frankly though I agree with alot of what you're saying.

Chilli Con Kearney

andekwarhola wrote: »

A lot of people in these forums have trouble grasping the fact that houses in the most desirable areas of a capital city are generally always going to be out of reach for all but a few buyers.

But hey, the market will eventually return to 'normality' and two teachers can buy a house in Rathgar.

Funnily enough, they only object to the property market rising, not wages and the economy.

You raise an interesting point.

Where would you think two teachers should be able to buy in Dublin? Doubt most would aim for Dalkey, Blackrock or Donnybrook.

I mean, their level in society and professional status is beneath two solicitors or two doctors. Their wages are too. They always have been and always will be. Their buying power will never match these.

But going back in time, you can say with a certain amount of certainty that most people in x area have y types of jobs. You don't get binmen living on Shrewsbury Road. But you might have a waste company owner who sold to a larger company.

Where would you see in Dublin being appropriate for two teachers? I'm being genuine BTW.

KyussBeeshop

padser wrote: »

Ah yes, the dastardly "private market".

Not a collection of individuals trying to make money by building houses, but rather a nefarious, shady underworld that meet up every quarter to decide exactly how many houses to build in order to keep the market under-supplied.

It's pretty impressive really that each of them abide by the decisions made at those quarterly meetings. Because, of course, if just a few of them decided to cash in on the opportunity by building more houses....they would make a pile of cash..........but then again that's not the type of thing the "private market" would be interested in.

It's funny the way people always have a childish 'conspiracy theory' view of corruption and market distortion - as if the only possible way for a market to be distorted in this manner, is for the group of villains to actively meet up and make evil plots in secret.

It's the idiotic Hollywood myth of how corruption works - when it's pretty easy to see how groups of people benefiting from a distorted market like this, can see it as being in their self interest to keep things as they are - without any need to actively conspire.

maninasia

Correct. The government have generally enacted policies that have been powerfully geared to pushing prices higher , for instance the 7 year CGT exemption , extremely lax control of private funds and allowing them to use charity type setups as tax shields on their earned income.

They don't have to change planning law because it was already strict and that suits a lot of settled homeowners who don't want more housing built in their area. Read about Shane Ross and Anne's Park to get the idea. Although the govt did being in a bill to make apartment construction more expensive a while back with overly high specifications required .

Also not spending money on capital investment is easy for them as they can then use that for various immediate <(vote buying) concerns like social welfare, increases, public servant wage increases....

theboringfox

Chilli Con Kearney wrote: »

You raise an interesting point.

Where would you think two teachers should be able to buy in Dublin? Doubt most would aim for Dalkey, Blackrock or Donnybrook.

I mean, their level in society and professional status is beneath two solicitors or two doctors. Their wages are too. They always have been and always will be. Their buying power will never match these.

But going back in time, you can say with a certain amount of certainty that most people in x area have y types of jobs. You don't get binmen living on Shrewsbury Road. But you might have a waste company owner who sold to a larger company.

Where would you see in Dublin being appropriate for two teachers? I'm being genuine BTW.

Two teachers in Dublin can live where they can afford to rent or buy. Typical buying age would be early 30s. So majority of teachers would have 10 years and maybe on 50k p.a. So two teachers would be 100k gross. That means can borrow 350k so with 50k savings thats 400k home.

Two teachers with guaranteed jobs likely to get exception if wanted higher.

I think for two people with guaranteed jobs and great pensions that is a great position to be in.

But then imagine same couple living in a small country village or town and how far those wages go. Maybe they should give more to Dublin based public service workers but think that would cause uproar.

I do genuinely feel for people trying to buy in Dublin. Left it myself after 12 years to return to Cork and big part was cost. Cost of living not much cheaper but housing cost way lower.

knipex

Wanderer78 wrote: »

Tons of research out there showing the rise of private debt globally over the last few decades, a large proportion of it on the cost of housing.

Yes 100% but people also borrow for new cars, sun holidays, new TV's, furniture, new kitchens etc. People also save less, have smaller deposits and such.

knipex

Yourself isit wrote: »

Ah the old privileged generations god love them.

Really.. And you say that based on what ??

Privileged based on what ??

I bought in 2006. at the top of the bubble. A smaller house than I would have liked, one that needed a lot of work and one that wasn't in my ideal location. BUT I could afford it..

I also rented and saved for 10 years. Saved hard for the last 5 to build a reasonable deposit and have enough to furnish at least the important bits..

knipex

Samuel T. Cogley wrote: »

In fairness did you mother work and bring in the same income as your father in the 70s? In most households now both partners work a higher standard is therefore expected and rightly so IMHO. Frankly though I agree with alot of what you're saying.

My mother was forced to retire when she got married but went back to work in the early 80's so bills could be paid..

The big cost now that didn't exist to the same extent is childcare, 2 parents working and families more spread out reducing level of family support available. Some of this is down to the fact that the lady minding 2 or 3 kids in her home is not as common as she used to be and that's the fault of the state and the parents who demand more for their kids..

gaius c

"kids these days have it too easy" said the generation that could buy a house on a wage from unskilled work at age 21

TallGlass

The house prices will fall when people start refusing to pay the amounts of money that they are going for in Dublin. I think there are a lot of people who play the poor hand when in fact they are quite seriously alright, I am looking at houses around Dublin and you'll find that there are quite a lot over the 600-650 mark.

I'm looking at some houses also around 300-400 that are seriously overpriced, you wouldn't swing a cat in the house, but if someone is willing to go nuts and pay then the prices will stay at that rate, I can't see it changing anytime soon, I will just continue saving and hopefully the pressure will have eased on the market in Dublin in a few years.

Samuel T. Cogley

knipex wrote: »

My mother was forced to retire when she got married but went back to work in the early 80's so bills could be paid..

The big cost now that didn't exist to the same extent is childcare, 2 parents working and families more spread out reducing level of family support available. Some of this is down to the fact that the lady minding 2 or 3 kids in her home is not as common as she used to be and that's the fault of the state and the parents who demand more for their kids..

Child care costs are something that the state can and should intervene on, after all it's in our constitution. However this should be done in a smart way with flexible working hours being imposed on lazy companies which won't do it themselves, but I'm digressing.

My mother also started back into the workforce in the 80/90s. We were a working class family and, although very intelligent, my mother never got any formal qualifications so would have been working in jobs that wouldn't have paid particularly well. I think that's different now, generally partners are of a similar education level - not always though I grant you.

We do need houses a barista and a retail worker can buy though but we probably need to be realistic where those are going to be. The commuter belt for Dublin is woefully under developed in relation to good public transport. Idealy if we're going to do nothing with child care people in that income bracket should be assisted in one parent providing childcare and another working and still being able to afford accommodation.

Cyrus

Idbatterim wrote: »

in relation to the above post, its now my friends all employed, never unemployed, on quite decent salaries are looking at getting out of this banana republic!

The cost of putting a roof over your head here just swallows up so much of your income! And its becoming a greater percentage all of the time for most people!

What's quite decent salaries ?