Property Market 2018

M.Cribben

These posts are getting tiresome at this stage.
Poster 1: "The crash is coming! The crash is coming! The sky is falling! The Irish property market is doomed!"
Poster 2: "How?"
Poster 1: "Erm, I dunno. It happened before?"

SNNUS

M.Cribben wrote: »

These posts are getting tiresome at this stage.
Poster 1: "The crash is coming! The crash is coming! The sky is falling! The Irish property market is doomed!"
Poster 2: "How?"
Poster 1: "Erm, I dunno. It happened before?"

Yeah same old roundabout of posts. No one can predict the future.. please keep it on property and mortgage queries..

Bob24

SNNUS wrote: »

Yeah same old roundabout of posts. No one can predict the future.. please keep it on property and mortgage queries..

Well this thread is about the property market so there will always be some level of subjectivity to how people discuss it (although I agree there is no point running in circles taking about a crash).

There is another thread for mortgages queries.

zl1whqvjs75cdy

It's the sneering condescending ones that get me. O you bought a house now. Well you're an idiot.

Anyway back on topic. When's the next daft report out to give us something to argue about.

utmbuilder

Serious lack of apartment stock making rich pickings and fleecing empty nesters looking to down size

Bob24

donkeyoaty0099 wrote: »

Anyway back on topic. When's the next daft report out to give us something to argue about.

Daft is useful as well, but I’m more interested in the RPPI.

And actually I know there’s been a few bank holiday weekends but the CSO seems to be pretty late with publishing it lately ...

And yes 100% agree condescending comments are bringing no value. Doesn’t mean we can’t have a bit of fun speculating about the market for the rest of the year though :-)

handlemaster

When you cant buy any house in Dublin for less than 300k.. after that you may start to think of a price fall. But only think as prices will go further than the highest prices in 2007 first.

Bobeagleburger

In Galway prices are insane.

An estate nearby sold houses for 300k height of boom.

Bottomed out at 180k in 2014.

Now prices at 360k.

I'd definitely be seriously concerned buying in at current prices.

The_Conductor

handlemaster wrote: »

When you cant buy any house in Dublin for less than 300k.. after that you may start to think of a price fall. But only think as prices will go further than the highest prices in 2007 first.

Its a different market though- the bulge is in the middle market properties- not the upper end properties. If you look at prices in D4/D6- they are at less than 75% of their peak prices- whereas- if you move outwards- the proportion of the 2007 prices reattained- shoots upwards and is breached in many distinctly working class areas (parts of West Dublin- are now significantly higher than they were during the boom).

The income multiple- is apply a brake on higher value properties (to a certain extent)- but to the same extent as you go further down the foodchain.

Either way- its kind of hard to know where we're going from here- the 'market' such as it is- is stratifying in a very different manner to how it did in the noughties.

Two new cats that are imminently to be tossed among the pigeons- the reappraisals for LPT- and the noises from the Central bank about how they need to make the income multiple rules- and esp. the exemption rules a lot stricter- in light of the manner in which government pump-prime policies are irrationally inflating the market.

Marius34

The_Conductor wrote: »

parts of West Dublin- are now significantly higher than they were during the boom

That can't be right. Which parts? 
Based on Daft. 3 bed in West Dublin asking price used to be ~364K, while on 2018 Q1 reports it's 293K.

The_Conductor

Marius34 wrote: »

That can't be right. Which parts? 
Based on Daft. 3 bed in West Dublin asking price used to be ~364K, while on 2018 Q1 reports it's 293K.

Specific developments in West Dublin- had 3 beds at 280-300k, with recent sales @ between 345 and 360k on propertypriceregister.ie

Its not across the board- its specific parts of West Dublin- and its also specific property types (aka- freehold 3 beds in established areas- *not* leasehold properties).

Also- there doesn't really seem to be any major difference in the price between walk-in properties- and hovels on the same road- they're all going for the same ballpark figures.

Village Weir in Lucan is an example, Sarsfield Park Lucan, Lucan Heights, Monastry in Clondalkin (I really couldn't be arsed looking any further).

Its all freeholds- in mature areas- not necessarily particularly nice areas- but freeholds- and not apartments.

handlemaster

The_Conductor wrote: »

Marius34 wrote: »

That can't be right. Which parts? 
Based on Daft. 3 bed in West Dublin asking price used to be ~364K, while on 2018 Q1 reports it's 293K.

Specific developments in West Dublin- had 3 beds at 280-300k, with recent sales @ between 345 and 360k on propertypriceregister.ie

Its not across the board- its specific parts of West Dublin- and its also specific property types (aka- freehold 3 beds in established areas- *not* leasehold properties).

Also- there doesn't really seem to be any major difference in the price between walk-in properties- and hovels on the same road- they're all going for the same ballpark figures.

Village Weir in Lucan is an example, Sarsfield Park Lucan, Lucan Heights, Monastry in Clondalkin (I really couldn't be arsed looking any further).

Its all freeholds- in mature areas- not necessarily particularly nice areas- but freeholds- and not apartments.

Three beds in west dublin can still be gotten for under 300k freehold

The_Conductor

handlemaster wrote: »

Three beds in west dublin can still be gotten for under 300k freehold

Yes- and in some estates where they never went above 300k during the noughties- they now are- thats the point I was making.

The flipside of the coin- is property in what many people would perceive as better neighbourhoods- has not recovered in a similar manner- very probably to do with lending multiples.

We have a very different market now- than we had in 2007.

How are you so sure what properties went for in the peak of the boom?

2 bed apartments in naas were going for 300k at the peak of the madness. I doubt houses in lucan were cheaper.

Alf Veedersane

Bob24 wrote: »

And actually I know there’s been a few bank holiday weekends but the CSO seems to be pretty late with publishing it lately ...

I'd venture that the timeliness of the report won't solely be down to the CSO and that they're waiting on data to be submitted.

alwald

Augeo wrote: »

How are you so sure what properties went for in the peak of the boom?

2 bed apartments in naas were going for 300k at the peak of the madness. I doubt houses in lucan were cheaper.

Its unlikely that this madness will happen again, mainly because of the current ECB rules.

The median or average yearly salary in Ireland is estimated at 44K I think, a single person can borrow up to 154K and a couple up to 308K.

The ECB rules will have a huge impact on house prices in the next few years, there will always be a percentage of the population (10 to 15% maybe) that can afford to buy expensive houses but the majority would have to stick to the maximum amount they can borrow.

EvolvedApe

There is a feeling in the air that a crash is incoming. I cant explain it.

Samuel T. Cogley

EvolvedApe wrote: »

There is a feeling in the air that a crash is incoming. I cant explain it.

I believe it's called wishful thinking.

SNNUS

OMG!!!

EvolvedApe wrote: »

There is a feeling in the air that a crash is incoming. I cant explain it.

The_Conductor

Lol- there are so many unknown variables on the horizon- such as an escalation in the trade war with the US, Brexit, China becoming a lot more forceful with EU companies etc etc.......... We're in for a bumpy ride- how this affects people's pay packets and their confidence to borrow (in an environment where interest rates are rising)- remains to be seen.

For the moment- we have the irrefutable fact- demand is vastly outstripping supply.
This demand is underpinning prices- as-is- and until such time as demand begins to equalise with supply- all would appear to be good.
Until then- the party drum keeps beating- even if those beating the drums aren't doing it quite as enthusiastically as they once were.

Times, they are a changing...........

M.Cribben

Anyone see this in the Indo today:

House prices 'will continue rising for next three years'

https://m.independent.ie/business/personal-finance/property-mortgages/house-prices-will-continue-rising-for-next-three-years-36994001.html

I'm a bit confused by the figures. They say we need 35000 new units a year to meet demand.

Dr McCartney, of Savills, said around 35,000 new homes need to be built every year for the next five years.

Then they predict the following completions:
2018: 20000
2019: 26000
2020: ?
2021: 35000
Hence the prediction that prices will stop rising in 3 years time. But even if we hit 35000 completions in 2021, there's still a backlog of roughly 25000 from not meeting demand in the intervening years. This would suggest prices will keep rising beyond 2021 until we actually exceed 35000 completions to clear demand backlog. Any thoughts?

beauf

Diversify. Don't be completely reliant on property. Don't over extend on it. So that if a crash came tomorrow you can still manage.

That said it's generally unaffordable unless you over commit.

zl1whqvjs75cdy

M.Cribben wrote: »

Anyone see this in the Indo today:



https://m.independent.ie/business/personal-finance/property-mortgages/house-prices-will-continue-rising-for-next-three-years-36994001.html

I'm a bit confused by the figures. They say we need 35000 new units a year to meet demand.




Then they predict the following completions:
2018: 20000
2019: 26000
2020: ?
2021: 35000
Hence the prediction that prices will stop rising in 3 years time. But even if we hit 35000 completions in 2021, there's still a backlog of roughly 25000 from not meeting demand in the intervening years. This would suggest prices will keep rising beyond 2021 until we actually exceed 35000 completions to clear demand backlog. Any thoughts?

I don't personally see how cost is going to stop rising in the next 3 years at least. Demand is still red hot, it might be capped out by the central bank rules but it's still there.

I would be in favor of the government removing the help to buy scheme and using the money to fund the rebuilding Ireland scheme. You can see now in new developments that the prices are creeping ever closer to a base of 400 k for a standard 3 bed. The 20 k rebate is only going to the developers, and with the level of demand out there for the foreseeable future we definitely do not need this kind of demand side incentive.

I worry a bit too about the temptation for government to go wading waist deep into property related hedonism. There's calls (mostly from construction sector granted) to reduce the vat rate. I also wonder if the central bank will be pressured into relaxing the rules. I really hope they aren't or all hope is lost and we're heading right back to where we are.

Another thing that isn't really talked about is the intense shortage of trades. Where the government thing they'll get the people to build these 35 k houses I don't know. Eastern Europeans aren't as interested as they were as their economies are generally far better than they were 10 years ago, and ironically the terrible rental situation here will keep them away.

There's lots of moving parts and things that need addressing in the system, but the only thing government seem interested in doing is stoking the demand with pointless tax incentives. Very much a case of just do something, doesn't matter if it's a good idea

Samuel T. Cogley

I would assume that 'meeting demand' would also include, at least a partial contribution towards, the backlog, hence why they think we've three years of rises ahead of us.

M.Cribben

Samuel T. Cogley wrote: »

I would assume that 'meeting demand' would also include, at least a partial contribution towards, the backlog, hence why they think we've three years of rises ahead of us.

It still doesn't make sense.
They estimate we need 35000 completions every year (including this year) to meet demand.
Then provide estimated completion figures for this year, and next. (20000 + 26000).

There's a shortfall there that will still exist beyond 2021. All this is assuming we can even reach 35000 completions by 2021. As already mentioned, shortage of builders/plumbers/electricians/carpenters/joiners/roofers/etc is impacting construction rates. Throw in NIMBYist objections almost everywhere a new development is planned and the supply issue won't be resolved for many years to come.

Colonel Claptrap

M.Cribben wrote: »

It still doesn't make sense.
They estimate we need 35000 completions every year (including this year) to meet demand.
Then provide estimated completion figures for this year, and next. (20000 + 26000).

There's a shortfall there that will still exist beyond 2021. All this is assuming we can even reach 35000 completions by 2021. As already mentioned, shortage of builders/plumbers/electricians/carpenters/joiners/roofers/etc is impacting construction rates. Throw in NIMBYist objections almost everywhere a new development is planned and the supply issue won't be resolved for many years to come.

Look at who is Dr. McCartney's employer and ask yourself why he might suggest these numbers.

Savills is one of the largest estate agents in the country. New builds are incredibly easy to sell compared to second hand. People are literally queuing up, cheque in hand, ready to buy. There are few viewings and no bidding wars take place with new builds. Easy money.

It's in Dr.McCartney's employer's interest to have a steady but below target supply of new housing every year. It keeps demand frothy if we don't hit those supply targets.

The last thing they want is a crash in prices. The second last thing they want is equilibrium.

Arthur Daley

Demand is red hot. But demand for Ferraris remains red hot, that is not much use when they are simply unaffordable.

Ferrari has only ever needed to sell to an elite. Less than 1% of the population. So he doesn't care that demand for his cars remains on fire, scarlet red hot, and affordability is only for the few. It's been his business model since day one.

The government and property industry need to build and sell houses to a wide population. Not just the top 1% or even 5%. The govt. being the biggest vested interest in the sale of a new build. So ferocious demand but no affordability is a big problem when you need to hit the mass market.

We have a supercar/luxury good business model applied to the most basic human requirement. Shelter. That cannot go on for ever. Just as it eventually bust in 07/08. About 7 years after it should have.

Bluefoam

The trend is moving towards build to rent... Houses to purchase are going to become rarer & the demand will remain. So even as the housing stock increases, the supply to allow individuals to buy will reduce. There may be a cooling off in the short term but it is going to become more and more difficult for people to own their own homes...

Samuel T. Cogley

Bluefoam wrote: »

The trend is moving towards build to rent... Houses to purchase are going to become rarer & the demand will remain. So even as the housing stock increases, the supply to allow individuals to buy will reduce. There may be a cooling off in the short term but it is going to become more and more difficult for people to own their own homes...

Apartments maybe, but not houses. You need your head examined if you want to become a one off LL in this market and REITs aren't going to be buying and managing housing estates when they can make more money off apartment complexes.

handlemaster

All this is about the city dewellers move outside and it's cheap property.