Property Market 2018

Cyrus

Bluefoam wrote: »

Hi,
I didn't read the entire thread, have just arrived back in the country... but interested to know how property is being advertised these days; as in, if it's advertised at 295,000 is it likely to go for €300,000 or like in the old days it's expected to sell for €600,000.

I'm trying to put a budget together, but having difficulty figuring out what price range I should be considering. Areas I'm interested in are inside M50, South City & County.

completely depends on the agent and the house.

i dont see much of things being listed at half what they are expected to sell at as asking prices have increased steadily, also you can look at new builds, the price is the price.

you are looking for somewhere in the most desirable section of the country so it will be expensive (relatively)

Bob24

Bluefoam wrote: »

Hi,
I didn't read the entire thread, have just arrived back in the country... but interested to know how property is being advertised these days; as in, if it's advertised at 295,000 is it likely to go for €300,000 or like in the old days it's expected to sell for €600,000.

I'm trying to put a budget together, but having difficulty figuring out what price range I should be considering. Areas I'm interested in are inside M50, South City & County.

It vastly depends on the location/presentation/price point, and selling strategy.

But on average I’d be inclined to say asking prices are set 10% below the expected selling price.

Best way to find out is to start bidding or if you’re not ready for that you can have a look st the property price register and look-up the original ads (you won’t always find them and sometimes they have been altered, but it will get you started).

dk1982

Bluefoam wrote: »

Hi,
I didn't read the entire thread, have just arrived back in the country... but interested to know how property is being advertised these days; as in, if it's advertised at 295,000 is it likely to go for €300,000 or like in the old days it's expected to sell for €600,000.

I'm trying to put a budget together, but having difficulty figuring out what price range I should be considering. Areas I'm interested in are inside M50, South City & County.

the rule of thumb is generally add 10%. I sold my house recently in Dublin 12. Had it up at 310k, it sold for 355k (sale agreed before Christmas, keys handed over last week). So that was 14.5% more than asking price.

LirW

Bluefoam wrote: »

I know that... I know what I have saved, what I can borrow and what I can afford to repay. The bank is processing my loan & I have negotiated a short probation with my new employer. Now I need to know if I can afford a two-bed house or a one-bed apartment... The websites aren't much help as no house is the same and it's difficult to gauge the market... I just want to know if prices being pitched are achievable or whether I'm barking up the wrong tree...

I spoke to DNG in June & they were advertising houses for 325k but selling for 600k (or at least that's how they presented it to me)... I'm not interested in getting involved in that kind of bull****.

If you're very interested in an area, get onto the property price register to get a vast idea for how much property in an area sells. When you for example go into the heart of Dun Laoghaire and there's a 3bed advertised for 270k you pretty much know that this will rise a lot. When you look in Marino and see houses for around the 420k mark, then they'll probably sell for a bit more than that because that's what the area costs.
Of course there are outliers, like houses in walk-in condition or a blank canvas that is completely empty and just needs a lick of paint and can be fitted out the way you want it from the get-go, they will always go higher up in price and sometimes some crazy person is willing to pay whatever it takes to get that one house because it's the one.

Other than that do the research for how much certain areas go, using the PPR and Daft, and go even so far, go to open viewings and follow up in the bidding process to get a feel for it.
When I was house hunting last year I've seen some crazy stuff happening in bidding.

M.Cribben

OwlsZat wrote: »

Central banks warns house prices could fall.
https://www.rte.ie/news/business/2018/0510/962529-philip-lane-on-house-prices/

The main factor for this will be the increase in housing supply that is coming on stream, with more houses and apartments being built each year.

He's right that supply is increasing, but we are years from even matching current demand levels in the main cities and towns, nevermind overshooting them.

https://www.irishtimes.com/business/financial-services/housing-report-says-50-000-units-might-need-to-be-built-each-year-1.3211919

There's also the question mark over governments figures for new completions. Davy stockbrokers estimate the actual figure could be as low as half the official figure.

zl1whqvjs75cdy

Would normally have a lot of time for Philip lane but he's off the mark here in my opinion. Though he's probably being strategic to try and keep the heat off him for increases in the ltv rules in September.

Arthur Daley

As always CBI will be covered when there is a drop off. They can say 'we did warn you about this'. You made informed decisions. And they'd be right.

UsBus

Daft has definitely gotten busier recently with the number of properties to sell. I'm wondering if some investors have just decided to offload their investment property. Seems to be a lot more value out there as well. Maybe prices are starting to plateau a bit.
One thing about Ireland and property prices is it's kind of a self fulfilling prophecy. Once enough people start talking things down, the selling will start to pick up..

whatever76

In cork city ( for desirable areas) things are certainly not slowly down price wise for houses 200-300 k bracket . ( do uppers included )
Been bidding this week and it gone 50k over asking in 2 weeks with 4 parties still bidding.
IMO Estate agents are pricing houses 20/40k under the 300k mark now for bidding war/interest to kick in and from what I experienced they get into the 320 price point quickly enough for those that really want it - very soon theses houses will start hitting 350k closing as the demand is there

Villa05

aloooof wrote:

If a couple intend on having children in the years after purchasing, it would be prudent to factor this into any calculations they make.

Prudence goes out the window during a period of rapid house price and rental inflation. People think of the here and now rather than 5 years later. The system forces people into making rash choices

lcwill

AlmightyCushion wrote: »

Arthur Daley wrote: »

Because they anticipate pay rises? Of which there is relatively little out there. In the middle of a 'boom'.

Just trying to tease out here the nonsense scenario where people working full time practically live on a social welfare level of income while ploughing as much as possible into the mortgage. And how unsustainable that is long term. Because high house prices are not sustainable long term IMO. As proven once already by the 07-13 crash.

I agree with you, however, no one suggested that people live on the same amount as the dole and throw the rest at the mortgage. They said that a couple can live comfortably on €2,000 a month after rent/mortgage and childcare. Which I think is fair.

We budget about 2000 a month for living costs for 2 adults, 2 kids, after rent and mortgage, and I thought we were being a bit extravagant - now I don't feel so guilty if we go a bit over budget now and then!

Rfrip

whatever76 wrote: »

In cork city ( for desirable areas) things are certainly not slowly down price wise for houses 200-300 k bracket . ( do uppers included )
Been bidding this week and it gone 50k over asking in 2 weeks with 4 parties still bidding.
IMO Estate agents are pricing houses 20/40k under the 300k mark now for bidding war/interest to kick in and from what I experienced they get into the 320 price point quickly enough for those that really want it - very soon theses houses will start hitting 350k closing as the demand is there

Yes agree with all this. Was looking at a duplex , 245 on daft...the bidding is currently at 290 at the moment.

theboringfox

Rfrip wrote: »

Yes agree with all this. Was looking at a duplex , 245 on daft...the bidding is currently at 290 at the moment.

Seems to be very competitive in that space. Cork City house price growth often looks lower but I wonder is that due to city boundary not taking in lot of areas that are basically in the city.

whatever76

theboringfox wrote: »

Seems to be very competitive in that space. Cork City house price growth often looks lower but I wonder is that due to city boundary not taking in lot of areas that are basically in the city.

yep its deadly in that price point and prob aligns with the average mortgage approval rate as well so that does not help along with Supply obviosuly. Prob a no brainer - people want to live in city more so than the suburbs like glanmire/Carriglaline etc and if a property pops up in areas like douglas/turners cross/ballyphehane/turners cross/st lukes under 300k then its a free for all and people spend on location ... you get a better house for sure outside city for the price but its all about location ( Blame Phil and Kirsty :P ) - I'm looking 12 months now and same old story every time .... so frustrating !

Not sure why its not popping up in data - prob suits the Estate agents its kept under the radar

The_Conductor

whatever76 wrote: »

Not sure why its not popping up in data - prob suits the Estate agents its kept under the radar

If you do your research carefully- and know the areas concerned- you can find it and its influence in the propertypriceregister.ie website. The reason though that its not having an outsized effect on prices though- is volume- while most people know about the anamoly- the actual number of properties involved is quite small- which is also why if you've been looking in the area, you'll see that you've bumped into several of the same people at house viewings over the past year- they're all in the same boat as you are- and doubtless- getting more and more frantic as time goes by- to try and buy something- which in turn is adding to the inflation for everyone else in the area.........

The simplest way of describing it is- its a local bubble, sustained by lack of availability- sure you can live in Glanmire, if you want to- and it costs less, but a lot of locals would rather live elsewhere- and not commute..........

Its just a Cork example of what is happening in Dublin and Galway. You don't need a Luas line- or walking distance Bridge street- to drive prices- every town or city has its own little areas- that people are more drawn to- for various reasons- and are willing to pay extra for.

The answer to all of this- is supply. Thankfully- planning permissions granted- show supplyside issues beginning to get ironed out- however, you're still looking at a 4-5 year window before we have a new balance- and even then you'd be well advised to read the Central Bank's note from yesterday (which has red lights flashing on it and an ominous 'warning-warning-warning' about yet another property price bubble).

Ireland is on the ECB's list of 4 markets to monitor as a result of our frothy property market (though our unique exposure to floating interest rates- is probably of more concern to the ECB than anything else- it would be nice if the government took note- and further steps to try and mitigate this train coming straight at us...........)

Villa05

The_Conductor wrote:

Ireland is on the ECB's list of 4 markets to monitor as a result of our frothy property market (though our unique exposure to floating interest rates- is probably of more concern to the ECB than anything else- it would be nice if the government took note- and further steps to try and mitigate this train coming straight at us...........)

I'm sure there preparing a press release along the lines of nobody saw it coming, sure, we were all at it

Naos

donkeyoaty0099 wrote: »

Would normally have a lot of time for Philip lane but he's off the mark here in my opinion. Though he's probably being strategic to try and keep the heat off him for increases in the ltv rules in September.

What changes are coming in September?

Bob24

Naos wrote: »

What changes are coming in September?

I think the poster meant the CBI is overstating the risk of a crash in order to push back on any government request to relax its macro-prudential rules.

But I honestly hope there is nothing serious about LTV increases in September. The CBI is one of the few institutions which I think has handled things decently over the past couple of years. If they were to open the money tap further they would lose my trust.

zl1whqvjs75cdy

Bob24 wrote: »

I think the poster meant the CBI is overstating the risk of a crash in order to push back on any government request to relax its macro-prudential rules.

But I honestly hope there is nothing serious about LTV increases in September. The CBI is one of the few institutions which I think has handled things decently over the past couple of years. If they were to open the money tap further they would lose my trust.

Exactly. Hope they keep them as is, and if anything tighten them in. If the lti is increased to say 3.75 all it will do is go straight to the banks. We're not ready for that yet.

_brendand_

donkeyoaty0099 wrote: »

Exactly. Hope they keep them as is, and if anything tighten them in. If the lti is increased to say 3.75 all it will do is go straight to the banks. We're not ready for that yet.

I reckon we need some info about how many cash purchases are taking place and at what level. If it's mainly at the higher price brackets and at a low volume then you're probably right, it would just serve to push prices up further. The only real argument to increase it across the board would be to let the majority of first time buyers compete on a level playing field with cash buyers.

_brendand_

adocholiday wrote: »

The property market is really worrying for us right now. The kind of house we want in the locations that we'd like are few and far between and the prices are rising by the day.

We are approved for a decent sum with the central bank rules but I'm not comfortable borrowing that much to be honest. I know it's highly situation dependent as to what is an 'affordable mortgage', but is 3.5x salary actually really affordable? Also we're worried about over-paying for a house. Maybe we're just being over cautious.

Does anyone have a good resource for budgeting for mortgage repayments? Might help us with our price limit etc.

For us it works out at 1000-1100 euro a month at current rates, which is a quarter of my take home pay. That's absolutely affordable, in fact more than affordable. Even if rates went up 2% it would still be only just above 40% which is where most people draw the line at the definition 'affordable'. One thing I know for sure is that the rent I'm paying is *not* affordable and never will be.

theboringfox

https://m.independent.ie/irish-news/news/in-2007-alan-ahearne-called-the-bust-now-he-predicts-whats-coming-next-36901076.html

Interesting article

Eric Cartman

theboringfox wrote: »

https://m.independent.ie/irish-news/news/in-2007-alan-ahearne-called-the-bust-now-he-predicts-whats-coming-next-36901076.html

Interesting article

The last paragraph and one of the earlier ones speak to me the most and aligns with a lot of what Ive been saying for a while.

1) there has been little credit expansion - true, but a hell of a lot of private investment in tech companies has seen the US economy and most western countries economies skyrocket.

2) The US could trigger a global recession - this is the worrying one, One of the biggest drives for increased demand in Dublin and people immigrating is jobs in technology companies, the so called 'silicon docks' are brimming with companies that you have to remember for the most part, are not making money. Facebook and google are making money , twitter, linkedin, snapchat etc... are not, they're still funded by selling shares.

My prediction is 2020/21 another dot com style crash where a lot of the funding is curtailed for these tech companies, they run out of runway and fold, leaving a lot of people in some pretty high demand areas of Dublin out of work and unable to afford their apartments. The secondary knock to this will be the hospitality sector and REIT's , almost all this serviced office space in Dublin is leased with US investment coin, big hotel groups like dalata are building like no tomorrow because they're not predicting a slump in corporate bookings from these tech companies, coffee shops / sandwich bars etc... then facilities companies, electricians, contract cleaners etc.. You are staring into a very near term contraction in the market as soon as some big players decide that investing in apps that are magically funded by ad revenue is no longer viable.

theboringfox

Eric Cartman wrote: »

The last paragraph and one of the earlier ones speak to me the most and aligns with a lot of what Ive been saying for a while.

1) there has been little credit expansion - true, but a hell of a lot of private investment in tech companies has seen the US economy and most western countries economies skyrocket.

2) The US could trigger a global recession - this is the worrying one, One of the biggest drives for increased demand in Dublin and people immigrating is jobs in technology companies, the so called 'silicon docks' are brimming with companies that you have to remember for the most part, are not making money. Facebook and google are making money , twitter, linkedin, snapchat etc... are not, they're still funded by selling shares.

My prediction is 2020/21 another dot com style crash where a lot of the funding is curtailed for these tech companies, they run out of runway and fold, leaving a lot of people in some pretty high demand areas of Dublin out of work and unable to afford their apartments. The secondary knock to this will be the hospitality sector and REIT's , almost all this serviced office space in Dublin is leased with US investment coin, big hotel groups like dalata are building like no tomorrow because they're not predicting a slump in corporate bookings from these tech companies, coffee shops / sandwich bars etc... then facilities companies, electricians, contract cleaners etc.. You are staring into a very near term contraction in the market as soon as some big players decide that investing in apps that are magically funded by ad revenue is no longer viable.

The interesting thing is though the economist states that you should not make decisions based on these what if scenarios. That fundamentally right now the market is similar to 2002 and it is strong fundamentals in the economy driving price rises and not speculation on price further price rises. Also thought it was interesting he advocated for more efficient use of land and to build higher. I would like to see that too to ease prices.

Eric Cartman

theboringfox wrote: »

The interesting thing is though the economist states that you should not make decisions based on these what if scenarios. That fundamentally right now the market is similar to 2002 and it is strong fundamentals in the economy driving price rises and not speculation on price further price rises. Also thought it was interesting he advocated for more efficient use of land and to build higher. I would like to see that too to ease prices.

I would like to see it too, sadly Ireland hates tall buildings for some insane reason.

Eric Cartman

Eric Cartman wrote: »

........... Facebook and google are making money , twitter, linkedin, snapchat etc... are not, they're still funded by selling shares.

My prediction is 2020/21 another dot com style crash where a lot of the funding is curtailed for these tech companies, they run out of runway and fold, leaving a lot of people in some pretty high demand areas of Dublin out of work and unable to afford their apartments............

How many are employed directly in the "not making money" silicon docks?
Loads of them are on sub €50k/annum I reckon.

Such is the supply constraint I don't think the techies being on the scratch will make a huge impact on Dublin tbh.

In the hotel market, even with all of the amateur room lettings there's still more than enough business IMO. Dalata are a notoriously shrewd crowd, they've taken over hotels on the cheap, the Dublin build won't make or break them.

suburbia .........where there is huge demand wouldn't notice either IMO

Microsoft owns LinkedIn iirc btw.

M.Cribben

Very well written and thought out article.

"A lot can go wrong in the world. President Trump could change US tax policy or create a trade war with Europe and China but that is impossible for anybody to say. So saying, 'I am going to run my life by things that might go wrong in the world', you can't live like that. I don't think that is a sensible approach.

He's right there. I see posters on here advising people to hold off on buying until Brexit or Trump causes our economy to crash. What if that doesn't happen though? Those people will be left in an even worse situation. I mean Brexit could have potential to actually strengthen our economy.

_brendand_

theboringfox wrote: »

https://m.independent.ie/irish-news/news/in-2007-alan-ahearne-called-the-bust-now-he-predicts-whats-coming-next-36901076.html

Interesting article

I think he's quite right. Of course prices can't go up this fast *forever* and at some point supply will catch up with demand, but the question is how soon and by how much. Myself and the missus could probably afford a house costing about 30k more if we waited to next year, saved a bit and got an exemption. What's the say though that 30k extra won't just buy us the same house as now at that stage. It would be pointless (not even talking into account all the rent tossed down the drain)

MayoSalmon

Fundamentals are right to buy a house now. In 2005/6 they were not. Very simple really

MayoSalmon

MayoSalmon wrote: »

Fundamentals are right to buy a house now. In 2005/6 they were not. Very simple really

Were fundamentals right last year and the year before too?
Because I can't really reconcile the staggering increase in prices over 24 months tbh.