Property Market 2019

fret_wimp2

tobsey wrote: »

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.

Wow, a lot of assumptions on first time buyers here.

I was a FTB in a new build, with a small driveway & a management company and i could not be happier.

management take care of the streets, the gardens, the playgrounds, the multiple gyms in the development.

The drive way is plenty big for my car.

My back garden is plenty big enough for everything I want.

The house is of a very high standard, and defects are covered for 10 years.

My price was set before the advent of the HTB grant so it was a genuine help.

Its about 50 m2 bigger and was about 30k cheaper than any of the 2nd hand houses that were on sale in the area.

Thats not a full list of benefits or awesome reasons why i really enjoy my property, just enough to contradict your points.

I feel for STB'ers, there is a penalization for having bought previously. it is unfair. but dont equate that, and your negative experiences with all FT'ers in new builds. Stick to realistic arguments about facts, not about opinions you think people have.
You'l come across less bitter overall.

BrownFinger wrote: »

Great post by Tobsey there,
and living under the same roof as another family is not my idea of living either.

Why would being an FTB'er = having to live with another family?
Some people may certainly chose to have logers. its 14k tax free after all but its a choice FTB & STB'ers can all make.

Bluefoam

Regardless of first time buyers grants etc. You still have to buy a house rationally and with your future in mind. People are jumping on these three and four bed houses on the far outskirts of Dublin, based on the grant and affordability the grant gives them... But what is not known is if those properties will ever have any value without government subsidies... I know people who bought in Ballbriggan, City West, and even Laois under the premises that within a few years they'd have enough equity to move somewhere more suitable to their needs. But 20 years later they are stuck there. Their houses have not accumulated value as developers keep building new and the government is subsidising the new builds... Who'd choose to buy second hand in those circumstances?

scheister

BrownFinger wrote: »

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.

fret_wimp2 wrote: »

Why would being an FTB'er = having to live with another family?

I assume the comment about living under the fact roof as another family talking about duplex style houses with an apartment at top or bottom of the building

fret_wimp2

Bluefoam wrote: »

Regardless of first time buyers grants etc. You still have to buy a house rationally and with your future in mind. People are jumping on these three and four bed houses on the far outskirts of Dublin, based on the grant and affordability the grant gives them... But what is not known is if those properties will ever have any value without government subsidies... I know people who bought in Ballbriggan, City West, and even Laois under the premises that within a few years they'd have enough equity to move somewhere more suitable to their needs. But 20 years later they are stuck there. Their houses have not accumulated value as developers keep building new and the government is subsidising the new builds... Who'd choose to buy second hand in those circumstances?

Firstly, perhaps these people have interest in living in these locations. Balbriggan, Lucan etc etc all have had families for generations, who's kids may want to buy and stay local. Or people may buy in these locations as it suits their commute. Not everyone works in the city center and it becomes much less benefical to live near the centre once kids are involved.

Secondly, not all new builds are on the "outskirts". I can be from my door to the city center 30 mins from my door using public transport. thats during peak times. Thats my daily commute.

fret_wimp2

scheister wrote: »

I assume the comment about living under the fact roof as another family talking about duplex style houses with an apartment at top or bottom of the building

So a comment against high density living. I dont want to get into the old argument about Dublin needing higher density accomodation, from my point of view, its necessary and duplex'es allow this in a larger format than most apartments, so more suitable for families who would like to live in high density areas.

The days of 100 square meter gardens, semi detached and detached houses are gone, at least for less than 800k. Its unfortunate but the idea that living under "the same roof" is a poorer standard of living is ridiculous. We cant build affordable homes for all, give everyone a separate roof & a big garden & a big front drive. It doesnt work with the population levels of today, wiht the demand for housing of today. There is finite land, it needs to be used efficiently.

fret_wimp2

fret_wimp2 wrote: »

Why would being an FTB'er = having to live with another family?
Some people may certainly chose to have logers. its 14k tax free after all but its a choice FTB & STB'ers can all make.

Semi D,Terraced house etc etc

fret_wimp2

BrownFinger wrote: »

Semi D,Terraced house etc etc

You want a detached!
best move to Cavan!

Mickiemcfist

BrownFinger wrote: »

Semi D,Terraced house etc etc

I'd take a Semi-D, Terraced or Duplex in Ranelagh over a 5000 sq ft house in any of Wicklow, Meath or Kildare any day. Life is for living, not for wasting 2 hours + a day in the car or on a bus.

q85dw7osi4lebg

Is this thread about the Irish property market or the Dublin property market? Not everyone needs to be in Dublin city centre on the daily basis, a lot of us have escaped it or never had ties to it.

Bluefoam

Rex Disgusting Tariff wrote: »

Is this thread about the Irish property market or the Dublin property market? Not everyone needs to be in Dublin city centre on the daily basis, a lot of us have escaped it or never had ties to it.

Then feel free to discuss...

q85dw7osi4lebg

Bluefoam wrote: »

Then feel free to discuss...

Is that not what I just did :pac:

Rex Disgusting Tariff

Rex Disgusting Tariff wrote: »

Is this thread about the Irish property market or the Dublin property market? Not everyone needs to be in Dublin city centre on the daily basis, a lot of us have escaped it or never had ties to it.

Exactly,

Mickiemcfist

Rex Disgusting Tariff wrote: »

Is this thread about the Irish property market or the Dublin property market? Not everyone needs to be in Dublin city centre on the daily basis, a lot of us have escaped it or never had ties to it.

Ah most of you lot don't have the internet so the demographics of this thread can seem a little skewed in fairness.

q85dw7osi4lebg

Mickiemcfist wrote: »

Ah most of you lot don't have the internet so the demographics of this thread can seem a little skewed in fairness.

Or maybe most of us all have our own houses and aren't bothered about discussing the apparent housing crisis. :pac:

The_Conductor

Mickiemcfist wrote: »

Ah most of you lot don't have the internet so the demographics of this thread can seem a little skewed in fairness.

Lots of us aren't from Dublin.
Also- a lot of the comments that people are ascribing to Dublin- are equally applicable to any of our major urban centres- some of which (Galway for example) are even worse than Dublin- and more in need of central high density residential accommodation units.
The country isn't Dublin and its suburbs- its a complex conundrum with differing needs in different areas- but with the commonality that we're all living under the selfsame legislative regime with the same bizarre and outdated rules governing us all.

Bob24

awec wrote: »

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.

I could argue about the general spirit of the regulation and how this is going against it, but i guess opinions might differ and maybe it’s better to stick to a particular technical point why I think this is definitely circumventing the rules.

As you might know the grant is conditional to living in the house for at least 5 years. It has to be fully or partially repaid if the recipient doesn’t meet that requirement. So technically this is not cash gift FTBs are getting from the government, but rather a loan with a special clause whereby the lender (in this case the government) forfeits its entitlement for repayment if the borrower fulfils certain conditions.

This means the money is at risk and might have to be repaid to the government at any point of time if the FTB moves out of the house. That makes it rather different from deposit money in cash you have on your bank account, which is unconditionally yours and has no string attached assuming you have no pre-existing debt before you take up the mortgage. While not exactly the same thing, from that perspective the grant has similarities to borrowing money from a bank / credit union / other person in order to use that money as a deposit: at some point you might have to repay that money which means it should be counted as a liability in your mortgage assessment (which is why a lender will ask you to justify the source for any large cash deposits received on your account and demonstrate whether there is associated debt).

Mickiemcfist

Bob24 wrote: »

I could argue about the general spirit of the regulation and how this is going against it, but i guess opinions might differ and maybe it’s better to stick to a particular technical point why I think this is definitely circumventing the rules.

As you might know the grant is conditional to living in the house for at least 5 years. It has to be fully or partially repaid if the recipient doesn’t meet that requirement. So technically this is not cash gift FTBs are getting from the government, but rather a loan with a special clause whereby the lender (in this case the government) forfeits its entitlement for repayment if the borrower fulfils certain conditions.

This means the money is at risk and might have to be repaid to the government at any point of time if the FTB moves out of the house. That makes it rather different from deposit money in cash you have on your bank account, which is unconditionally yours and has no string attached assuming you have no pre-existing debt before you take up the mortgage. While not exactly the same thing, from that perspective the grant has similarities to borrowing money from a bank / credit union / other person in order to use that money as a deposit: at some point you might have to repay that money which means it should be counted as a liability in your mortgage assessment.

I read that as a positive of the HTB. It's a help to buy not a help to flip. Have to say I'm a real fan of it. I haven't used it but I agree with the idea & think it worked.

MrWyatt

Bob24 wrote: »

I could argue about the general spirit of the regulation and how this is going against it, but i guess opinions might differ and maybe it’s better to stick to a particular technical point why I think this is definitely circumventing the rules.

As you might know the grant is conditional to living in the house for at least 5 years. It has to be fully or partially repaid if the recipient doesn’t meet that requirement. So technically this is not cash gift FTBs are getting from the government, but rather a loan with a special clause whereby the lender (in this case the government) forfeits its entitlement for repayment if the borrower fulfils certain conditions.

This means the money is at risk and might have to be repaid to the government at any point of time if the FTB moves out of the house. That makes it rather different from deposit money in cash you have on your bank account, which is unconditionally yours and has no string attached assuming you have no pre-existing debt before you take up the mortgage. While not exactly the same thing, from that perspective the grant has similarities to borrowing money from a bank / credit union / other person in order to use that money as a deposit: at some point you might have to repay that money which means it should be counted as a liability in your mortgage assessment.

It also means the property can't be rented out. While I understand this is to prevent speculation on property it does affect employment flexibility. This is turn can put the property at risk if the FTB is made redundant and offered a job in a different location. Should there be a downturn in the economy, this is even more likely.

Pussyhands

tobsey wrote: »

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.

Half of all sales were cash.

q85dw7osi4lebg

Pussyhands wrote: »

Half of all sales were cash.

Half of cash buyers are downsizers.

aloooof

Pussyhands wrote: »

Half of all sales were cash.

I don't really see your point. The level of supply is increasing, so even if half of all sales remain cash, the number of non-cash buyers will still be increasing.

L1011

"Cash" buyers also include REIT purchases.

Pussyhands

The HTB has not increased builds.

If someone had to wait a year to save up for the rest of their deposit, someone else would be in a position to buy that house. If this wasn't the case then house prices would fall

Where the HTB has really benefitted is in the pockets of people building one off houses in the countryside they were going to build anyways and in the pockets of developers who built houses first time buyers were going to buy anyways.

All the estates were going to be built anyways. To say it HTB has increased supply is false. They were going to be sold to someone either way. The number of people capable and willing to buy without HTB far exceeds the number of houses being built.

aloooof

Pussyhands wrote: »

All the estates were going to be built anyways. To say it HTB has increased supply is false. They were going to be sold to someone either way. The number of people capable and willing to buy without HTB far exceeds the number of houses being built.

All you're really saying here is that demand exceeds supply. That can absolutely be the case AND the HTB can have increased supply (but still not enough to meet demand). They're not mutually exclusive.

q85dw7osi4lebg

Lies, two developers I know are cancelling / postponing phase 2 and 3 of two sites unless it’s clarified that the HTB is being extended at the end of the year. You are making up so much stuff it’s hilarious.

Thargor

Prices in Bray where Im looking dont seem to be softening at all :mad:

The_Conductor

Rex Disgusting Tariff wrote: »

Lies, two developers I know are cancelling / postponing phase 2 and 3 of two sites unless it’s clarified that the HTB is being extended at the end of the year. You are making up so much stuff it’s hilarious.

It would make sense to at very least sit down and relook at the financial implications of proceeding- cognisant of 20k less in prices. However, prices have gone up far more than 20k in the last 24 months- so it doesn't really hold water- the asking prices 2 years ago- were less than the HTB fob in difference- if it made sense then- why not now?

I get that construction inflation is accepted to be circa 5%- however, this doesn't mean that if they don't get this that their figures don't stack up.

Any developer would be constantly looking at the bottom line and redoing their figures- they'd be nuts not to- I just don't see how 20k is going to make the difference between going ahead or not doing so- at today's prices though.

Mickiemcfist

The_Conductor wrote: »

It would make sense to at very least sit down and relook at the financial implications of proceeding- cognisant of 20k less in prices. However, prices have gone up far more than 20k in the last 24 months- so it doesn't really hold water- the asking prices 2 years ago- were less than the HTB fob in difference- if it made sense then- why not now?

I get that construction inflation is accepted to be circa 5%- however, this doesn't mean that if they don't get this that their figures don't stack up.

Any developer would be constantly looking at the bottom line and redoing their figures- they'd be nuts not to- I just don't see how 20k is going to make the difference between going ahead or not doing so- at today's prices though.

20k per house on to your bottom line means you're a safer bet for a construction finance house, therefore they approve higher amounts & give you larger tranches as you & by extension they are less exposed to cost or sale price fluctuations. Very few developers have cash so financing is how they do it, I used to work for a medium sized developer who was paying upwards of 12% interest on developments of 200+ houses due to the low margin & therefore high risk profile.

alwald

This government is turning the blind eye to the housing crisis and they don't seem to know what they are doing or what strategy will work best.

The FTB scheme has indeed worked and many FTB benefited from it, the housing supply increased although not to the required level but for me this has nothing to do with the FTB scheme as houses were going to be built anyway because the demand is massive - and I agree with the fact that the rules should have been different so that FTB must have 10% of the deposit in order to benefit from the scheme.

I personally would have preferred a scheme similar to the rebuilding Ireland home but with a lower rates since the ECB rates are at their lowest - a scheme similar to the tracker mortgages.

The areas where the government failed miserably were highlighted in a UN report that was published of which a summary can be found in this link: https://www.thejournal.ie/un-ireland-vultures-funds-tax-4563403-Mar2019/

We all remember the apartments sold in Finglas in 2018 to a special trust, why weren't these sold to FTB and hardworking people who pay their taxes but instead they were sold to companies that pay 0 taxes as per this tweet from Oliver Callan https://twitter.com/olivercallan/status/998902592297226241?lang=en?

I am sick to my stomach of this government and their lack of serious actions to tackle this crisis by laying out a strong and comprehensive plan.

Rents are high, house prices are high, block of apartments are sold to organisations that pay 0 taxes and homelessness exceeded 10K this year.

This government needs to go and fast with the hope that their replacement will tackle this crisis in a more efficient manner.

hmmm

alwald wrote: »

Rents are high, house prices are high, block of apartments are sold to organisations that pay 0 taxes and homelessness exceeded 10K this year.

Whether apartments are sold for rent or for purchase, they are extra supply. The REIT thing is just leftie distractions.

Similarly the reason why the government has allowed the "homeless" exceed 10k, is because most voters know there aren't actual 10,000 people truly homeless. And most people don't want to live beside social housing.

Supply seems to be rising and prices seem to be levelling off which can only be good news. The rental market is still in a mess, a lot of which is due to rules endorsed by leftwing parties.