Property Market 2019

shenanagans

Umaro wrote: »

Hi all

Long time reader of this thread. One topic that was hit on last week was the struggle most people have to get their deposit together. I think the Central Bank rules were good when introduced, but the growth in house prices and rents has made it harder for people to accumulate the deposit. The deposit changed from a safeguard to a burden where the longer you are saving money the more money you will require.

So I have 2 questions:

A. Do you think they will ever reduce the deposit rule or get rid of it altogether?
B. If they did, what would be the immediate effect on the market. Suddenly a lot more people are able to enter the market, but they're still limited by the 3.5x borrowing rule. Do house prices jump in a noticeable way or have we just increased the amount of people showing up to viewings?


Regardless, I do think it'd be a good idea to retain the 3.5x rule but I'm aware that some would see the easing of the deposit rule as a slippery slope...

A. No. deposit requirements will not be changed.
B. Just more people after those first time buyer Houses. More people in the market for 300-400k properties I expect.

Bluefoam

Umaro wrote: »

Hi all

Long time reader of this thread. One topic that was hit on last week was the struggle most people have to get their deposit together. I think the Central Bank rules were good when introduced, but the growth in house prices and rents has made it harder for people to accumulate the deposit. The deposit changed from a safeguard to a burden where the longer you are saving money the more money you will require.

So I have 2 questions:

A. Do you think they will ever reduce the deposit rule or get rid of it altogether?
B. If they did, what would be the immediate effect on the market. Suddenly a lot more people are able to enter the market, but they're still limited by the 3.5x borrowing rule. Do house prices jump in a noticeable way or have we just increased the amount of people showing up to viewings?


Regardless, I do think it'd be a good idea to retain the 3.5x rule but I'm aware that some would see the easing of the deposit rule as a slippery slope...

One of the benefits of having a deposit is that you have equity in the property... As you build up equity it is more difficult to lose your home and it is also a benefit to the bank that you have a stake in the mortgage. 100% mortgages have proven to have a negative impact on the market and are unlikely to return to this country any time soon. If you're a first time buyer you get 10% of the property value for free... Sounds like a good deal to me

beauf

ZX7R wrote: »

It's the only real solution is to bring in immigrants as you put it but qualified trades people most of Europe are doing it, for the last 15 years Irish government pushed for young people to go into I.T.
So now you have a Sevier shortage of plasters brickies ect in the country.
Most trades people left from the boom are heading the wrong side of 40 or are young appreciates.

Nonsense.

Most people who work in building\trades don't want to sit all day in an office and have no interest in computers or office work. You won't be pushing them into IT.

There simply wasn't any work which is why people left the trades or left the country and there were alternatives to allow people to finish their apprenticeships or freeze them.

The problems with construction was due to a boom and bust economy.

Assetbacked

Umaro wrote: »

Hi all

Long time reader of this thread. One topic that was hit on last week was the struggle most people have to get their deposit together. I think the Central Bank rules were good when introduced, but the growth in house prices and rents has made it harder for people to accumulate the deposit. The deposit changed from a safeguard to a burden where the longer you are saving money the more money you will require.

Yeah, a big problem for those renting is that the last few years, rents have increased so much which actually means renters are able to save less and less each month! It indicates to me that "growth" is very misleading as a barometer of a strong economy in terms of actual money-in-the-pocket of renters and I think that is a large part of the government failing to view the housing situation as a soul-destroying crisis.

The_Conductor

Umaro wrote: »

So I have 2 questions:

A. Do you think they will ever reduce the deposit rule or get rid of it altogether?
B. If they did, what would be the immediate effect on the market. Suddenly a lot more people are able to enter the market, but they're still limited by the 3.5x borrowing rule. Do house prices jump in a noticeable way or have we just increased the amount of people showing up to viewings?


Regardless, I do think it'd be a good idea to retain the 3.5x rule but I'm aware that some would see the easing of the deposit rule as a slippery slope...

One very fast and noticeable effect of a further reduction in deposit requirements- would be an additional buffer demanded by lenders to offset against possible losses. The deposit is a security blanket for them- prices have to fall by >10% before a first time buyer is in negative equity (or >20% for a subsequent buyer). If you yank this security off a lender- economics 101 would dictate that they would price the greater risk into the cost of supplying the loan- and yank up interest rates to compensate.........

This is also why we all go back to banks and lenders as we pay down our mortgages- and demand better interest rates when our LTV ratios hit predetermined levels............

OwlsZat

While I dont see anything to indicate any immediate crash risk. The whole household wealth has never been higher stuff is shenanigans. We were well down this road before. We inflate house prices and fool ourselves into thinking we're rich.

airportgirl83

Interesting articles in IT today.

First one is the assessment of Brexit and how hard or soft one will be bad for Ireland. Second article touches on EU proposed Consolidated Common Corporate Tax Base, which would see large firms pay corporation tax proportionate to where their sales, staff and headquarters are located - price to pay for the backstop according to the article.

https://www.irishtimes.com/business/economy/no-deal-brexit-capable-of-derailing-economy-and-reigniting-troubles-1.4009063?mode=amp

https://www.irishtimes.com/business/economy/will-there-be-a-price-to-be-paid-by-ireland-for-the-backstop-1.4010373?mode=amp

Thargor

airportgirl83 wrote: »

Interesting articles in IT today.

First one is the assessment of Brexit and how hard or soft one will be bad for Ireland. Second article touches on EU proposed Consolidated Common Corporate Tax Base, which would see large firms pay corporation tax proportionate to where their sales, staff and headquarters are located - price to pay for the backstop according to the article.

https://www.irishtimes.com/business/economy/no-deal-brexit-capable-of-derailing-economy-and-reigniting-troubles-1.4009063?mode=amp

https://www.irishtimes.com/business/economy/will-there-be-a-price-to-be-paid-by-ireland-for-the-backstop-1.4010373?mode=amp

The article asks "Will there be a price for Ireland?" not that there will be, Betteridge's law of headlines says the answer is usually no.

Roberto_gas

Fear factor now hitting house prices nationwide

https://www.independent.ie/irish-news/fear-factor-now-hitting-house-prices-nationwide-38477361.html

beauf

Fear of what exactly?

I won't look at that click bait rag.

tigger123

beauf wrote: »

Fear of what exactly?

I won't look at that click bait rag.

Uncertainty around Brexit.

Zenify

beauf wrote: »

Fear of what exactly?

I won't look at that click bait rag.

Denial?

beauf

I see so it's fear of bexit.

Not...

market peaking
new regulation
Affordability at its limits
New supply
High cost of builds
High cost of refurbishment
High tax on cost of living
High tax on construction
Govt policy favouring external investment
Govt policy discouraging BTL...
Insurance costs out of control...

But no it's some newspaper looking for click bait behind a pay wall/data grab. That has its finger on the pulse of the nation. Fear....

beauf

I'll bet that fear rollercoaster is loved every one waiting for a crash so they repeat the cycle by buying property. Deja vu much?

We are at near Celtic Tiger boom levels. Only this time we have finally some controls on it.

Boards is great we have one thread full of Doom and another wanting all controls lifted so they can go full steam ahead.. Like a broken clock that's right twice a day. They'll both be right eventually.

airportgirl83

beauf wrote: »

I see so it's fear of bexit.

Not...

market peaking
new regulation
Affordability at its limits
New supply
High cost of builds
High cost of refurbishment
High tax on cost of living
High tax on construction
Govt policy favouring external investment
Govt policy discouraging BTL...
Insurance costs out of control...

But no it's some newspaper looking for click bait behind a pay wall/data grab. That has its finger on the pulse of the nation. Fear....

Imo it's all above that you listed and Brexit and global economy issues....

Sheeps

If Brexit will result in cheaper house prices they can build a fucking ice wall between the North and South of this Island for all I care. Bring it on.

beauf

Are you sure it's not fear and denial. Seems convincing.

The_Conductor

Our costs are so far out of kilter- its actually laughable. It costs more to build a 2 bed apartment on a greenfield site in Dublin- than in Paris. We need to get our costs under control- its all well and good blaming Brexit (or whatever other bogeyman we choose to blame)- however, the fact of the matter is we have a cost structure that is a joke.

smurgen

beauf wrote: »

I'll bet that fear rollercoaster is loved every one waiting for a crash so they repeat the cycle by buying property. Deja vu much?

We are at near Celtic Tiger boom levels. Only this time we have finally some controls on it.

Boards is great we have one thread full of Doom and another wanting all controls lifted so they can go full steam ahead.. Like a broken clock that's right twice a day. They'll both be right eventually.

If you look back at my posts i predicted price falls in q3/4 about a year ago and said it was a stupid time to buy.i was told i was stupid cause of the rent i was paying wouldn't equate to the saving in any possible price drop.you yourself were one of those mocking anyone talking down prices in anyway or those hesitant of purchasing. You've made that broken clock comment on several occasions.

awec

smurgen wrote: »

If you look back at my posts i predicted price falls in q3/4 about a year ago and said it was a stupid time to buy.i was told i was stupid cause of the rent i was paying wouldn't equate to the saving in any possible price drop.you yourself were one of those mocking anyone talking down prices in anyway or those hesitant of purchasing. You've made that broken clock comment on several occasions.

You were talking about significant drops, don’t try pretend that you correctly predicted anything that has happened to date!

Absolutely nobody who bought will regret it based on anything that has happened in the market so far. Absolutely nobody.

If you keep repeating it, eventually you’ll be right.

smurgen

awec wrote: »

You were talking about significant drops, don’t try pretend that you correctly predicted anything that has happened to date!

Absolutely nobody who bought will regret it based on anything that has happened in the market so far. Absolutely nobody.

If you keep repeating it, eventually you’ll be right.

The year is young. Lets see where we're at at year end. I'm happy i didn't buy and I'm happy i didn't buy in my area,Cork as prices have fallen roughly 4%, i was looking in the 350k category so that's a 14k fall, also factor into the saving on an overinflated mortgage. While my rent had only increased 4% from 1188 to 1,227 in the same period. I feel vindicated but I'm sure you'll let me know why i shouldn't in awhile.

awec

smurgen wrote: »

The year is young. Lets see where we're at at year end. I'm happy i didn't buy and I'm happy i didn't buy in my area,Cork as prices have fallen roughly 4%, i was looking in the 350k category so that's a 14k fall, also factor into the saving on an overinflated mortgage. While my rent had only increased 4% from 1188 to 1,227 in the same period. I feel vindicated but I'm sure you'll let me know why i shouldn't in awhile.

How can you feel vindicated, you haven’t bought anything so savings are entirely hypothetical. You’re still renting.

Come back to us when you actually buy something and we can calculate the amount you saved (or didn’t) compared to buying 6 months ago, and we’ll see if it was worth it.

beauf

smurgen wrote: »

If you look back at my posts i predicted price falls in q3/4 about a year ago and said it was a stupid time to buy.i was told i was stupid cause of the rent i was paying wouldn't equate to the saving in any possible price drop.you yourself were one of those mocking anyone talking down prices in anyway or those hesitant of purchasing. You've made that broken clock comment on several occasions.

Maybe you could quote what you are talking about.

I had a search and couldn't find what you are talking about. But then search is so poor its hard to find anything on this forum.

beauf

The_Conductor wrote: »

Our costs are so far out of kilter- its actually laughable. It costs more to build a 2 bed apartment on a greenfield site in Dublin- than in Paris. We need to get our costs under control- its all well and good blaming Brexit (or whatever other bogeyman we choose to blame)- however, the fact of the matter is we have a cost structure that is a joke.

A large of % of the cost is tax.

JJJackal

smurgen wrote: »

The year is young. Lets see where we're at at year end. I'm happy i didn't buy and I'm happy i didn't buy in my area,Cork as prices have fallen roughly 4%, i was looking in the 350k category so that's a 14k fall, also factor into the saving on an overinflated mortgage. While my rent had only increased 4% from 1188 to 1,227 in the same period. I feel vindicated but I'm sure you'll let me know why i shouldn't in awhile.

House fell by 14k in 1 year.. u paid close to 15k rent in the same time....

Cyrus

smurgen wrote: »

The year is young. Lets see where we're at at year end. I'm happy i didn't buy and I'm happy i didn't buy in my area,Cork as prices have fallen roughly 4%, i was looking in the 350k category so that's a 14k fall, also factor into the saving on an overinflated mortgage. While my rent had only increased 4% from 1188 to 1,227 in the same period. I feel vindicated but I'm sure you'll let me know why i shouldn't in awhile.

If the exact house you wanted has decreased 4% you will have saved a bit but you have paid rent for a 12 month period that you won’t get back either

Padre_Pio

Cyrus wrote: »

If the exact house you wanted has decreased 4% you will have saved a bit but you have paid rent for a 12 month period that you won’t get back either

You have also pushed out having to take out house insurance and all the other costs associated with getting a mortgage, as well as all the maintenance costs of owning a house that your landlord is probably paying for.

Also, over the life of the mortgage, that 14k will probably cost closer to 17 or 18k.

JJJackal

Padre_Pio wrote: »

You have also pushed out having to take out house insurance and all the other costs associated with getting a mortgage, as well as all the maintenance costs of owning a house that your landlord is probably paying for.

Also, over the life of the mortgage, that 14k will probably cost closer to 17 or 18k.

You will be paying back the money longer; life assurance will have increased as you will be older, landlord maintaining a house they are going to sell....

If the exact house you wanted to buy 1 year ago is still on sale for 4% less today; it will be in worse condition than it was 1 year ago.

An alternative view is you bought one year ago, decided to rent out a room for a year and have now paid down 1 year of your mortgage, so you are in a house having paid off the value of the % decrease in value - but you are not worried re rent, rise or fall of other houses or anything else

Cyrus

Padre_Pio wrote: »

You have also pushed out having to take out house insurance and all the other costs associated with getting a mortgage, as well as all the maintenance costs of owning a house that your landlord is probably paying for.

Also, over the life of the mortgage, that 14k will probably cost closer to 17 or 18k.

Most of the same purchasing costs apply you have saved a few hundred euro worth of insurance so what ?

smurgen

awec wrote: »

How can you feel vindicated, you haven’t bought anything so savings are entirely hypothetical. You’re still renting.

Come back to us when you actually buy something and we can calculate the amount you saved (or didn’t) compared to buying 6 months ago, and we’ll see if it was worth it.

I wont be buying for 6 months/ year minimum.market gonna keep falling.lots of new builds coming online in cork too and in the interim the goal is to grow that deposit.saved a good bit renting this apartment too. Cooker and shower packed up in the last few month. Management company were very fast to come in and sort it. I'll certainly miss that aspect of renting.