Property Market 2019

awec

The_Conductor wrote: »

If it was genuinely to help first time buyers- rather than to provide a sop to developers- it shouldn't matter whether a property is new- or not.

Its a sop of developers, plain and simple- but the manner in which its structured- means its far cheaper for a FTB to buy a new unit- than it is to buy a unit in a more mature area- so there is a disincentive to look at secondhand property. Meanwhile a non-FTB, who is not affected by this ridiculous scheme- gets their choice of the secondhand market- with a clearrun- given the lack of FTB's who are going to buy........

The scheme has resulted in a new stratification- with younger FTBs in new estates in West Dublin/North Kildare- and older non-FTBs in more mature areas.

I disagree with this.

There is no point in giving tax windfalls to people who already own property. There is no ultimate real here.

Maurice Yeltsin

Rew wrote: »

Half of Killiney/Glenageary is really Sallynoggin and the other half is Ballybrack so the lines are a bit blurred esp when it comes to schools. .

Indeed, but it seems strange to me that people from filthy rich backgrounds would want to move to somewhere of that social construct just because it's near where they grew up. Particularly considering the posts on this forum I've read, some people making out largely quiet areas of the Northside such as the aforementioned Kilbarrack to be something like The Wire. My brother lives there, it's nothing of the sort. And the price feckin reflects that unfortunately. Nearby Edenmore has recently seen a spike in incidents, and the shops must be the scaldiest looking strip in all of Dublin, but the fact is the houses there start at 290k and barely 3 minutes away in Darndale they start as low as 160k.

cisk wrote: »

Ballybrack and shankill’s issue is that they’re not far from major professional business parks like Central Park, South County and Sandyford.

The job growth in those locations has been immense, the new Microsoft campus alone is staggering. So a short drive to work and a nice location by the sea is going to be very attractive for young professionals, the prices are lower than anywhere surrounding that’s not south to Wicklow or west to Tallaght.

I think the a comparison could be what happened to Ringsend after google and other IT multinationals located in the Docklands.

Distance to work has to be the strangest deciding factor I've heard, particularly when it comes to multinationals. You might not be working for them in ten years. They might ship your department to their new premises in Naas. Etc etc etc. If anything I don't understand how, generally speaking, the mid west of Dublin is relatively affordable compared to formerly pure working class parts of the North East (Artane, Kilbarrack, Edenmore, Donaghmede, these bizarrely seem to attract a premium for their proximity to the overcrowded and often unreliable DART line). The likes of Tallaght, Clondalkin, Ballyfermot, Blanch, Finglas and Ballymun at a push are fairly equidistant to almost any location in the greater Dublin region.

awec

Maurice Yeltsin wrote: »

Indeed, but it seems strange to me that people from filthy rich backgrounds would want to move to somewhere of that social construct just because it's near where they grew up. Particularly considering the posts on this forum I've read, some people making out largely quiet areas of the Northside such as the aforementioned Kilbarrack to be something like The Wire. My brother lives there, it's nothing of the sort. And the price feckin reflects that unfortunately. Nearby Edenmore has recently seen a spike in incidents, and the shops must be the scaldiest looking strip in all of Dublin, but the fact is the houses there start at 290k and barely 3 minutes away in Darndale they start as low as 160k.



Distance to work has to be the strangest deciding factor I've heard, particularly when it comes to multinationals. You might not be working for them in ten years. They might ship your department to their new premises in Naas. Etc etc etc. If anything I don't understand how, generally speaking, the mid west of Dublin is relatively affordable compared to formerly pure working class parts of the North East (Artane, Kilbarrack, Edenmore, Donaghmede, these bizarrely seem to attract a premium for their proximity to the overcrowded and often unreliable DART line). The likes of Tallaght, Clondalkin, Ballyfermot, Blanch, Finglas and Ballymun at a push are fairly equidistant to almost any location in the greater Dublin region.

Bizarre. I would imagine distance to work is somewhere near the top of every single home buyers list of things that are important.

It is probably only beaten by the price, and distance to family.

Not sure where the notion that this is only important depending on what sector of the economy you work in comes from. Certainly don't think there's an epidemic of multinationals moving themselves around the country.

What are the people who work for the likes of Facebook supposed to do? "I currently work in town, but I'll buy this gaff in Laois cause sure you never know, I might some day have a job a bit closer to there!". Nobody, except for maybe civil servants, can accurately plan what they'll be doing employment wise in 10 years. All you can do is plan for the now, and the near future.

Maurice Yeltsin

awec wrote: »

Bizarre. I would imagine distance to work is somewhere near the top of every single home buyers list of things that are important.

It is probably only beaten by the price, and distance to family.

.

Well yes, it's important in terms of not spending more than an hour in traffic or public transport. But like I said, there's few economically active parts of Dublin, Kildare and Meath that aren't within a 30 minute drive of mid West Dublin. Whereas if you have bought in Dun Laoghaoire and your firm announces it's moving from Cherrywood to Navan, you've a bit of a commute there. If you live in Clondalkin and the same move is announced it isn't quite the same hassle.

awec

Maurice Yeltsin wrote: »

Well yes, it's important in terms of not spending more than an hour in traffic or public transport. But like I said, there's few economically active parts of Dublin, Kildare and Meath that aren't within a 30 minute drive of mid West Dublin. Whereas if you have bought in Dun Laoghaoire and your firm announces it's moving from Cherrywood to Navan, you've a bit of a commute there. If you live in Clondalkin and the same move is announced it isn't quite the same hassle.

How often does this happen?

Like how can this possibly ever be predicted? If you bought in Dun Laoghaire and your firm announces it's moving from Cherrywood to Dun Laoghaire you'd be laughing.

All people can go on is what is true today. The likelihood of any multinational moving to the likes of Navan must be somewhere around zero.

Maurice Yeltsin

awec wrote: »

How often does this happen?

.

The missus has worked for two large firms that have moved either departments or the entire staff to Dundalk and Leopardstown from Blanch and Ballsbridge.

Isn't there an abandoned complex of either Dell or Microsoft in Bray? They clearly moved elsewhere. Didn't HP move out of Leixlip a while ago?

Big firms moving is very common. Outgrowing their old premises, scaled down and can't justify the rent on the existing premises, it's very commonplace. It's worth remembering these firms are often here 30 plus years, that's a long time to occupy the same premises for a growing business. You'd be naive to invest an extra 100k in a house on the assumption you'll work five minutes down the road until you're 66.

The_Conductor

awec wrote: »

I disagree with this.

There is no point in giving tax windfalls to people who already own property. There is no ultimate real here.

I don't really understand how/why you imagine that allowing first time buyers their choice of where to spend their 'grant' is a windfall to people who already own property? Its a grant to FTBs- to enable them to buy where they so choose. By limiting it to new properties- it specifically disincentivises them from buying in mature areas. Its going to give them an advantage over other purchasers in mature areas- who don't have access to such a 'grant'. However- we're already at prices that are limited by people's ability to borrow- so its hardly likely that its going to do anything to the prices (hell, even new prices have plateau'ed in the greater Dublin area- people simply can't afford to pay more).

I get that you imagine it would increment the price that the seller of a second hand property might achieve- I would argue that in the current market- the market quite simply is not in a position to bear further increases- so any effect would be muted by CB rules on lending multiples.

It would, naturally, give FTBs an advantage over non-FTBs- as on the one hand they have a lower deposit requirement- and on the other hand the 'grant' would pay their 10% deposit (or a large chunk of it).

I get it- you don't want a windfall for people for doing nothing- but the current scheme is just that- only its a windfall for developers that specifically creates artificial communities- with limited numbers of older families and or elderly people- as they are actively discriminated against in new developments in favour of FTBs on two different grounds.

How about a case for giving OAPs a deontas to downscale to one of these new properties and sell their abode in the leafy suburbs?

Any scheme that favours one group of people- almost certainly excludes or actively discriminates against another.

awec

The_Conductor wrote: »

I don't really understand how/why you imagine that allowing first time buyers their choice of where to spend their 'grant' is a windfall to people who already own property? Its a grant to FTBs- to enable them to buy where they so choose. By limiting it to new properties- it specifically disincentivises them from buying in mature areas. Its going to give them an advantage over other purchasers in mature areas- who don't have access to such a 'grant'. However- we're already at prices that are limited by people's ability to borrow- so its hardly likely that its going to do anything to the prices (hell, even new prices have plateau'ed in the greater Dublin area- people simply can't afford to pay more).

I get that you imagine it would increment the price that the seller of a second hand property might achieve- I would argue that in the current market- the market quite simply is not in a position to bear further increases- so any effect would be muted by CB rules on lending multiples.

It would, naturally, give FTBs an advantage over non-FTBs- as on the one hand they have a lower deposit requirement- and on the other hand the 'grant' would pay their 10% deposit (or a large chunk of it).

I get it- you don't want a windfall for people for doing nothing- but the current scheme is just that- only its a windfall for developers that specifically creates artificial communities- with limited numbers of older families and or elderly people- as they are actively discriminated against in new developments in favour of FTBs on two different grounds.

How about a case for giving OAPs a deontas to downscale to one of these new properties and sell their abode in the leafy suburbs?

Any scheme that favours one group of people- almost certainly excludes or actively discriminates against another.

Because owners of second hand properties will simply up the price of their homes by 20k.

awec

Maurice Yeltsin wrote: »

The missus has worked for two large firms that have moved either departments or the entire staff to Dundalk and Leopardstown from Blanch and Ballsbridge.

Isn't there an abandoned complex of either Dell or Microsoft in Bray? They clearly moved elsewhere. Didn't HP move out of Leixlip a while ago?

Big firms moving is very common. Outgrowing their old premises, scaled down and can't justify the rent on the existing premises, it's very commonplace. It's worth remembering these firms are often here 30 plus years, that's a long time to occupy the same premises for a growing business. You'd be naive to invest an extra 100k in a house on the assumption you'll work five minutes down the road until you're 66.

Yes, they move from smaller offices to bigger offices, older ones to newer ones. That is true of any company. It's not really unique to multinationals.

But they don't move around the country at the drop of a hat like you are suggesting. It's certainly not "commonplace".

And HP didn't "move out of Leixlip". They closed their plant there and laid people off.

Dell moved from Bray to Cherrywood. Again, hardly a massive move with minimal impact on commutes and and certainly not this Dublin to Navan talk.

The_Conductor

awec wrote: »

Because owners of second hand properties will simply up the price of their homes by 20k.

Even developers couldn't 'up' their prices by 20k in the current market- we're at the max of people's borrowing capacity. People's inability to borrow additional funds is the brake on price rises- be they from FTBs or anyone else. Central bank rules- are saving people from their own worse excesses. We'd certainly up prices- and get them too- if people could afford to pay the revised prices- but they can't.

In a market where there wasn't an alternate brake on price increases- what you're suggesting would likely happen. In the current market- its a non-runner.

awec

The_Conductor wrote: »

Even developers couldn't 'up' their prices by 20k in the current market- we're at the max of people's borrowing capacity. People's inability to borrow additional funds is the brake on price rises- be they from FTBs or anyone else. Central bank rules- are saving people from their own worse excesses. We'd certainly up prices- and get them too- if people could afford to pay the revised prices- but they can't.

In a market where there wasn't an alternate brake on price increases- what you're suggesting would likely happen. In the current market- its a non-runner.

Sorry, I meant if it was available for second hand properties back when it was first introduced.

The_Conductor

awec wrote: »

Sorry, I meant if it was available for second hand properties back when it was first introduced.

Gottcha.
Yes- there was an overnight increase in new prices (its been well documented)- it would beggar belief that there wouldn't be a commensurate increase in secondhand prices.

I'd argue that the current scheme has done its thing- FTBs already have an incentive over other buyers as they only require half the deposit of a non-FTB- many of whom aren't moving as they quite simply don't have the deposit.

The whole sector is nuts.

Bob24

Mickiemcfist wrote: »

Why can't a policy have a dual aim? First aim - get construction going again - achieved. Second aim - help FTB's who have very little hope of saving a deposit in a tougher rental climate than any current homeowner has encountered - achieved

A policy can have a dual aims if the two goals are not contradictory. In this case the selfish interest of developers and FTBs were clearly in direct contradiction (each of them wanted to retain as much of the grant as possible) meaning only the one with the most leverage could benefit from the policy. And policymakers were well aware of this.

In practice this translated to the prices of those houses increasing about as much as the grant amount due to market forces. So FTBs suddenly got a free extra 20k on their budget but st the same time the price of their desired house increased by 20k - not difference to them.

awec

The_Conductor wrote: »

Gottcha.
Yes- there was an overnight increase in new prices (its been well documented)- it would beggar belief that there wouldn't be a commensurate increase in secondhand prices.

I'd argue that the current scheme has done its thing- FTBs already have an incentive over other buyers as they only require half the deposit of a non-FTB- many of whom aren't moving as they quite simply don't have the deposit.

The whole sector is nuts.

From the point of view of incentivizing housing being built I would agree, it has done it's job.

But the first time buyer deposit problem has not been solved. People stuck renting in these crazy times will struggle to accumulate a deposit for a mortgage that they could probably afford no problem.

Maybe there are other ways this can be solved, like tax breaks against rent, but I'm not an expert.

The_Conductor

awec wrote: »

Maybe there are other ways this can be solved, like tax breaks against rent, but I'm not an expert.

Proposal currently on the table is an SSIA type product geared solely at FTBs into which they would save a monthly amount. The product would not have a defined lifespan (i.e. it would be open ended)- however, on withdrawing from the scheme a FTB would receive an enhanced top-up from the government (its suggested as much as 25% to a maximum of 25k) *providing* it was used for the purchase of a first property. If it were used for an alternate purpose- the topup would be reduced to a much lower percentage (10%) and the max topup would also be reduced (to 10k).

I.e. a deposit saving scheme for renters which would get a topup- and if you decided at the end of the day that you weren't going to use it for a deposit- you'd still get an incentive, just not as generous an incentive.

awec

Bob24 wrote: »

A policy can have a dual aims if the two goals are not contradictory. In this case the selfish interest of developers and FTBs were clearly in direct contradiction (each of them wanted to retain as much as the grant as possible) meaning only the one with the most leverage could benefit from the policy. And policymakers were well aware of this.

In practice this translated to the prices of those houses increasing about as much as the grant amount due to market forces. So FTBs suddenly got a free extra 20k on their budget but st the same time the price of their desired house increased by 20k - not difference to them.

Imagine you were buying a house at 480k, with no HTB in place.

Deposit required would be 48k for a FTB, to be saved entirely by yourself.

Now you get 20k HTB, and the price goes to 500k. But deposit requirements that you need to save yourself drop to 30k, which is 18k less than before.

So while you aren't saving on the total cost of the house (in fact, it costs more over the term due to interest), you are short-cutting on the deposit requirements significantly.

theboringfox

I think the HTB grant should be allowed expire at year end but I would be surprised with potential GE around corner if it is not extended by 12 months.

The_Conductor

theboringfox wrote: »

I think the HTB grant should be allowed expire at year end but I would be surprised with potential GE around corner if it is not extended by 12 months.

Wrong place to discuss this- but I'd be shocked if the government survive the summer.......

Also- there are a plethora of other property related mechanisms with built-in expiry dates coming up on the horizon- not least of all the RPZ legislation.

The issue is there have been too many cooks stirring the pot- and the myriad of schemes in operation are both cumbersome and also very counterproductive.

We need more supply- critically- in good locations- and its not coming down the tracks- so it doesn't really matter what weird and wonderful policy ideas are dreamt-up- unless it unlocks good quality supply in central locations- its doomed to failure.

Pussyhands

awec wrote: »

An interesting question is has the HTB scheme been a success?
.

The answer to that question is simple. Does the 20k make the difference between buying a new house or not. The answer I can almost guarantee is that no, the vast majority of buyers have not become home owners due to the HTB.

awec

Pussyhands wrote: »

The answer to that question is simple. Does the 20k make the difference between buying a new house or not. The answer I can almost guarantee is that no, the vast majority of buyers have not become home owners due to the HTB.

I have no idea how you have arrived at this conclusion.

q85dw7osi4lebg

HTB was a success for me, couldn't afford the house I wanted at the time I wanted without it. Only needed to save €14,000 between us, such a handy house purchase. Would have taken another year to save the other €14,000, let alone the rent we would have paid in that year and the fact the houses went up €20k. They are €55k more expensive now two years later. Will be forever thankful for the HTB.

Bob24

awec wrote: »

Imagine you were buying a house at 480k, with no HTB in place.

Deposit required would be 48k for a FTB, to be saved entirely by yourself.

Now you get 20k HTB, and the price goes to 500k. But deposit requirements that you need to save yourself drop to 30k, which is 18k less than before.

So while you aren't saving on the total cost of the house (in fact, it costs more over the term due to interest), you are short-cutting on the deposit requirements significantly.

Yes fair point, it is also a way for the government to help people circumvent the central bank's lending rules. Not something I'd say the government should be proud of though...

Sheeps

awec wrote: »

Imagine you were buying a house at 480k, with no HTB in place.

Deposit required would be 48k for a FTB, to be saved entirely by yourself.

Now you get 20k HTB, and the price goes to 500k. But deposit requirements that you need to save yourself drop to 30k, which is 18k less than before.

So while you aren't saving on the total cost of the house (in fact, it costs more over the term due to interest), you are short-cutting on the deposit requirements significantly.

Where are you getting the 48k figure from? The 10% deposit is only up to 220k, and 20% on everything over that. The deposit should be 74k.

q85dw7osi4lebg

Sheeps wrote: »

Where are you getting the 48k figure from? The 10% deposit is only up to 220k, and 20% on everything over that. The deposit should be 74k.

The deposit required is 48k. That over 220k nonsense is long gone thankfully.

awec

Bob24 wrote: »

Yes fair point, it is also a way for the government to help people circumvent the central bank's lending rules. Not something I'd say the government should be proud of though...

I don't really see it as circumventing the lending rules. The 3.5 rule is still in place, all that is happening is the government helping people gather together a deposit.

I don't see much difference between a person having to save 5% themselves or 10% themselves. Once they have 10% in the end, have shown an ability to save a significant amount (i.e. at least half) and aren't getting a crazy LTI it seems ok to me.

Evd-Burner

Sheeps wrote: »

Where are you getting the 48k figure from? The 10% deposit is only up to 220k, and 20% on everything over that. The deposit should be 74k.

Since 1 January 2017: For first-time buyers of principal dwelling homes the limit of 90% LTV applies on the full value of all residential property, so first-time buyers will need a deposit of 10% for any house or apartment, regardless of price.

From citizens information.

Sheeps

Evd-Burner wrote: »

Since 1 January 2017: For first-time buyers of principal dwelling homes the limit of 90% LTV applies on the full value of all residential property, so first-time buyers will need a deposit of 10% for any house or apartment, regardless of price.

From citizens information.

Wasn't aware this had been scrapped, thanks!

tobsey

I would like to be a STB but can’t at the moment due to the CBI 20% rules. The HTB scheme had two goals, increase supply and encourage developers to build more. That seems to have worked as lots of people have bought houses they’d have had to wait a lot longer for, and the number of new houses has gone up year on year.

People here are saying that the 20k was added straight away to the cost of new houses, but that didn’t matter. That 20k only required 1k of savings to cover the deposit rules if the house was up to 400k in value. The vast majority of people buying these houses were two income childless couples, probable earning 50k each at least if in Dublin. That was no problem to them.

The fact that the 20k added to the new house price hurt STBs is a red herring. Second time buyers have no interest in new homes. They don’t want to buy houses that have no driveway, management company fees and probably a small garden. They put up with that the first time and don’t want to do it again. The only issue is that they now need 20% deposit, 4 times that of new buyers rather than double. This is a killer especially for the negative equity generation, even if they’re out of it now. They might be able to sell and have something left over but it’s very unlikely to be enough to trade up to something bigger.

That’s what’s killing me at the moment. I could probably sell my 3-bed house for 320k now even though a brand new estate down the road is selling them for 370k, but I can’t get the 80k deposit to buy the second hand 4-beds for 400k. I’ve paid a mortgage for 10 years without fail and it counts for nothing. People my age who haven’t bought can get the bigger mortgage on a cheaper house just because they haven’t bought before. That I find is unfair. If the HTB is giving 5% deposits to new buyers then the CBI rules should be 10% for everyone. Give the FTBs a leg up while still encouraging development, without making very difficult for the main cohort of trader-uppers who bought in the 00’s to move on.

myshirt

Sheeps wrote: »

Wasn't aware this had been scrapped, thanks!

That will give you insight on the complete nonsense that is posted on here a lot. More recently by Pussyhands. I always say if you haven't a clue what you are on about then just sit it out, but people think once they have Google at their disposal they are an expert on everything. It's not just this topic. It's every topic. Fair warning for anyone using boards as their source of info. Take it with a pinch of salt. You'll get a good steer from the better posters but you will get an appalling steer from others. Thankfully it's moderated.

Great post by Tobsey there,
Dead right about the new builds being aimed at ftb.
Have some friends that bought new builds in the last 2 years that are seriously regretting it all ready.
Lack of front garden,small back garden and living under the same roof as another family is not my idea of living either.