Property Market 2019

The_Conductor

Am I correct in assessing that the bulk of the pain is in secondhand prices- new properties are not seeing falls in a similar vein?
I imagine that the first time buyers 'grant' is giving artificial support to new house prices.
September is going to be interesting- but it looks like a switch has been flicked.........

Mickiemcfist

The_Conductor wrote: »

Am I correct in assessing that the bulk of the pain is in secondhand prices- new properties are not seeing falls in a similar vein?
I imagine that the first time buyers 'grant' is giving artificial support to new house prices.
September is going to be interesting- but it looks like a switch has been flicked.........

Yea I was looking at new builds briefly in South Dublin & started to think you'd actually be in negative equity from day 1. I was looking at 500k houses & they weren't worth it & the ease of purchase (HTB) being the reason they're even considered. I was looking at comparable second hand houses & they were 400/450 max in the same area so I feel that's the loss you'd have on day 1.

SozBbz

Mickiemcfist wrote: »

Yea I was looking at new builds briefly in South Dublin & started to think you'd actually be in negative equity from day 1. I was looking at 500k houses & they weren't worth it & the ease of purchase (HTB) being the reason they're even considered. I was looking at comparable second hand houses & they were 400/450 max in the same area so I feel that's the loss you'd have on day 1.

Its funny, I think people buy new for a lot of reasons but I agree, I think some are over valued.

I do think its hard to compaire new homes with older stock - they're often apples and oranges. New houses are all about open plan living spaces and 3 story lay outs, energy efficiency but with small gardens. Older homes are often the opposite.

I think those who buy new houses are doing so on the assumption that they won't really have to spend on anything else. Perhaps the know they're paying a premium, not to have unexpected maintenance costs or to need to put up with a house with quirks! Old houses can be money pits. I think they're just very different propositions, and appeal to differnt types of people.

I certainly don't think those buying new will see any appreciation in value.

Mickiemcfist

SozBbz wrote: »

Its funny, I think people buy new for a lot of reasons but I agree, I think some are over valued.

I do think its hard to compaire new homes with older stock - they're often apples and oranges. New houses are all about open plan living spaces and 3 story lay outs, energy efficiency but with small gardens. Older homes are often the opposite.

I think those who buy new houses are doing so on the assumption that they won't really have to spend on anything else. Perhaps the know they're paying a premium, not to have unexpected maintenance costs or to need to put up with a house with quirks! Old houses can be money pits. I think they're just very different propositions, and appeal to differnt types of people.

I certainly don't think those buying new will see any appreciation in value.

I agree there's loads of reasons to buy new, own stamp, BER ratings etc. etc.
But the comparisons I was making was with new builds vs houses which were maybe 5-7 years old, similar layout & spec & within 500 yards of eachother.

beaz2018

I bought a new build in 2017 and after a year there I certainly feel now it was overpriced and is probably worth less now than what we paid for it. The HTB is very tempting, it takes 20k off what you need to have saved and frees up cash to put into the other expenses of buying - furniture etc. I dont know about other people's situation but for a young couple with a kid that was massive for us. Unfortunately I would like to leave Dublin in a few years so selling without a big loss is going to be difficult.

Interested Observer

I recently moved into a fairly high demand area in D7 (at the time at least). My house initially went on the market last Oct/Nov and was sale agreed by the 3rd viewing maybe (though that fell through and I bought it instead). A house down the road went up on the market early this year, the viewings were as packed as I've ever seen, was sale agreed within 2 weeks or maybe less.

Two more houses on my road went up for sale in the early summer and both took much, much longer to sell. They've both gone sale agreed now but were up on the market for a number of months before going. I'm really interested to check the PPR in a month or two to see what they went for.

My own place is 110m2-ish, and I could have gotten a similar house for a good bit less than we paid but we love the area, so I've no regrets at all.

Mad_maxx

The_Conductor wrote: »

Honestly- the prices that were being achieved in Galway were built on scarcity, nothing else. That scarcity is being satisfied- both by landlords stampeding to the door- but also by a significant number of new developments coming online (including several fairly close to the city centre.

Spidal and some other areas were up at D4/D6 prices- which is completely irrational, it was a matter of time before there was a correction- that correction is probably being pushed by landlords exiting the sector- which bodes ill for anyone hoping to rent anywhere near the city centre in future.

This is bourne out by the steady increase in rents- despite the large price drops in achievable prices for property.

Galway was dearer than Dublin relative to any barometer you can check

Wages and employment options
Lifestyle choice
Dependency on fewer large high wage employers

Then again some places have always been irrationally expensive, Limerick city was insanely cheap until as recently as 2016, its up 40% in less than three years and rents are up 60% in three years

Mad_maxx

SozBbz wrote: »

Its funny, I think people buy new for a lot of reasons but I agree, I think some are over valued.

I do think its hard to compaire new homes with older stock - they're often apples and oranges. New houses are all about open plan living spaces and 3 story lay outs, energy efficiency but with small gardens. Older homes are often the opposite.

I think those who buy new houses are doing so on the assumption that they won't really have to spend on anything else. Perhaps the know they're paying a premium, not to have unexpected maintenance costs or to need to put up with a house with quirks! Old houses can be money pits. I think they're just very different propositions, and appeal to differnt types of people.

I certainly don't think those buying new will see any appreciation in value.

The only thing I don't like about new builds are the social engineering factor where a fifth of houses in the estate are reserved for public housing

With tradesmen near impossible to source, a new house is worth a hundred grand more in some cases

A fixer upper would need to be half the price of a new build with the tradesperson famine

Mad_maxx

beaz2018 wrote: »

I bought a new build in 2017 and after a year there I certainly feel now it was overpriced and is probably worth less now than what we paid for it. The HTB is very tempting, it takes 20k off what you need to have saved and frees up cash to put into the other expenses of buying - furniture etc. I dont know about other people's situation but for a young couple with a kid that was massive for us. Unfortunately I would like to leave Dublin in a few years so selling without a big loss is going to be difficult.

Unlikely to be worth less, market up since 2017 everywhere bar 700 k upwards market in Dublin

terrydel

beaz2018 wrote: »

I bought a new build in 2017 and after a year there I certainly feel now it was overpriced and is probably worth less now than what we paid for it. The HTB is very tempting, it takes 20k off what you need to have saved and frees up cash to put into the other expenses of buying - furniture etc. I dont know about other people's situation but for a young couple with a kid that was massive for us. Unfortunately I would like to leave Dublin in a few years so selling without a big loss is going to be difficult.

Depending on where you go, the loss might be offset at least somewhat by the lower cost to buy in the new location.
i wouldnt overly fret in your shoes, enjoy having a home you worked hard for and see what happens.

SozBbz

Mickiemcfist wrote: »

I agree there's loads of reasons to buy new, own stamp, BER ratings etc. etc.
But the comparisons I was making was with new builds vs houses which were maybe 5-7 years old, similar layout & spec & within 500 yards of eachother.

Ok, thats interesting so.

I did hear an opinion on newstalk recently that I thought was perhaps worthy of note (it was that woman who has a property programme on a saturday morning - forget her name)

Anyway, she was pointing to a generational aspect around new homes - basically saying that some young people who are so used to everything in life having a price and never negotiating that they're attracted to new homes as the price is the price, and they can just walk up and put a deposit down. She was basically saying that new buyers often end up paying a premuim because they don't want to get into a drawn out bidding process.

Now, I'm that generation and am on the verge of buying 2nd hand for the 2nd time. First property was about 20 years old and next one is over 100 years old.

Although I intellectually I know the pros of a new home, they leave me cold.

Mad_maxx

SozBbz wrote: »

Ok, thats interesting so.

I did hear an opinion on newstalk recently that I thought was perhaps worthy of note (it was that woman who has a property programme on a saturday morning - forget her name)

Anyway, she was pointing to a generational aspect around new homes - basically saying that some young people who are so used to everything in life having a price and never negotiating that they're attracted to new homes as the price is the price, and they can just walk up and put a deposit down. She was basically saying that new buyers often end up paying a premuim because they don't want to get into a drawn out bidding process.

Now, I'm that generation and am on the verge of buying 2nd hand for the 2nd time. First property was about 20 years old and next one is over 100 years old.

Although I intellectually I know the pros of a new home, they leave me cold.

I'd buy second hand in a very good established area over new build every time

Mickiemcfist

SozBbz wrote: »

Ok, thats interesting so.

I did hear an opinion on newstalk recently that I thought was perhaps worthy of note (it was that woman who has a property programme on a saturday morning - forget her name)

Anyway, she was pointing to a generational aspect around new homes - basically saying that some young people who are so used to everything in life having a price and never negotiating that they're attracted to new homes as the price is the price, and they can just walk up and put a deposit down. She was basically saying that new buyers often end up paying a premuim because they don't want to get into a drawn out bidding process.

Now, I'm that generation and am on the verge of buying 2nd hand for the 2nd time. First property was about 20 years old and next one is over 100 years old.

Although I intellectually I know the pros of a new home, they leave me cold.

Yea that makes a lot of sense actually. We chose a c.30 year old property as I value an established neighborhood, large garden, no social housing etc. over some of the mod cons & simplicity of purchasing new properties. I'm 30 years old too but I do see myself as not the typical millennial, fix my own cars, I love DIY etc. so an older house needing work suits me but I see why it wouldn't suit others.

SozBbz

Mad_maxx wrote: »

I'd buy second hand in a very good established area over new build every time

I think perhaps theres a dip in value. New homes that are no longer brand new (5/10 years old) probably are a challenge to sell on because they've maybe lost their sparkle but aren't old enough to have character. Also if they're part of an estate, the estate itself maybe going through the difficult teen years so less attractive. Ultimately I think the area will make or break the chances of selling on such a house well.

I'm a 2nd hand house person all the way. also the areas I want to live in are mostly developed with much older stock. I also love character and a big back garden.

terrydel

SozBbz wrote: »

I think perhaps theres a dip in value. New homes that are no longer brand new (5/10 years old) probably are a challenge to sell on because they've maybe lost their sparkle but aren't old enough to have character. Also if they're part of an estate, the estate itself maybe going through the difficult teen years so less attractive. Ultimately I think the area will make or break the chances of selling on such a house well.

I'm a 2nd hand house person all the way. also the areas I want to live in are mostly developed with much older stock. I also love character and a big back garden.

I know there are reasons for it, but the size of gardens in new builds is criminal. Garden is hugely important to me, I've two dogs that need the space and it is a place for myself and herself to relax and escape to. I'd buy a lesser house with a good garden over a better new build with a small back garden any day.

voluntary

COLONELsANDERS wrote: »

Oberservation 1 : The 'right' houses are selling at/above asking. Aspect, Cul De sac, parking, garden, close to public transport etc. If it ticks all your boxes it ticks other people's too.

Oberservation 2 : The 'wrong' houses are going well below asking. Probably due to extra supply coming on board.

If that's true then this just means both sellers price their assets wrong. Ones with 'right' houses put too low asking prices, and 'wrong' houses put to high asking prices. I would wonder why is that?

SozBbz

voluntary wrote: »

If that's true then this just means both sellers price their assets wrong. Ones with 'right' houses put too low asking prices, and 'wrong' houses put to high asking prices. I would wonder why is that?

I don't agree - if your house gets a flurry of interest and then multiple bids, then it was absolutely brought to market at the right price.

Asking prices are just starting points, and if the price set brings multiple serious buyers to the table, and result in a bidding war that gets you a strong ultimate selling price, then IMO thats a perfect scenario from the sellers point of view.

Its not like people are bound to sell for the asking price.

voluntary

Wouldn't be both quiciker and more efficient to price the house correctly the first time and wait for somebody who is willing to pay such amount and just sell? How many times potential buyers walk away as the EAs hold in hope for achinving a higher price? I get, this is a negotiation technicque and it's fine, it's everyone's choice how to get the most of the transaction, but I'm just not convinced here.

Then what about above mentioned sellers of 'wrong' houses pricing them too high? Wouldn't such strategy also work for them? Price low and wait for tons of offers?

SozBbz

voluntary wrote: »

Wouldn't be both quiciker and more efficient to price the house correctly the first time and wait for somebody who is willing to pay such amount and just sell? How many times potential buyers walk away as the EAs hold in hope for achinving a higher price? I get, this is a negotiation technicque and it's fine, it's everyone's choice how to get the most of the transaction, but I'm just not convinced here.

Then what about above mentioned sellers of 'wrong' houses pricing them too high? Wouldn't such strategy also work for them? Price low and wait for tons of offers?

To be clear, pricing slightly low is smart as I've said. Pricing too high (for vanity, greed, denial, whatever reason) is foolish, as you won't sell your house, certainly not quickly and not without compromising.

No one actually knows a houses value until its been on the market. Any house is only worth what someone is willing to pay for it. So to say that people should just put it on at the right price is basically asking for 20/20 hindsight.

People should aim just below what they think is achievable - get people through the door, get some momentum. Buying a house is emotional for most people , so you have to get them involved. Plenty of people end up stretching if they've fallen in love. This can happen if you've 2 or more serious buyers, which you only get if you've had a decent amount of interest. If you fail to get enough people through the door in the first instance, you're limiting your options.

Slightly low is strategic, too high is just hubris.

Spanish Eyes

Anecdotal I know but it’s true.

Houses round here have gone sale agreed with a month or two. Like many other places too when they are priced intelligently and realistically.

Anyhow a house up the road went for sale in June and as you do, I looked at asking price. Whoa! Looked high to me.

Still languishing but has now been reduced by 20k. That’s more like it. Will be sold soon now.

It’s a great house, beautifully maintained, but asking pitched far too high initially. IMV.

I’d hate to have such a reduction recorded on the listing. Better to price lower initially and see what happens.

SozBbz

Heres one for you.

This originally came on at the start of the year at €625k based on "what others had gone for on the road" according to the agent. Its been reduced twice, each time by €50k.

I viewed it and IMO its significantly worse in person. Theres the potential to make a beautiful home - very family friendly road, close to Dundrum Village, but IMO the entire insides of the house need ripping out. The layout is fundamentally flawed and the work done to turn it into a dormer is not good in my view. It needs stripping back to bare bones. They're now only starting to talk sensible numbers, after wasting so much time.

Now its an executor sale so it will be sold eventually but only to someone whos up for a project and gets it at the right price. Who knows whether the EA or the family thought €625k was the right price, but someone made a woeful misjudgment.

https://www.myhome.ie/residential/brochure/64-highfield-park-dundrum-dublin-14/4208053

hmmm

COLONELsANDERS wrote: »

Been a long time lurker on here and recently bought a house in DLR, Dublin so thought I'd provide some market colour. Hope it's helpful

Great post, fully agree.

If there's one thing the crash thought me, it is to ignore most economists. They're too busy looking at their models, and don't seem to spend enough time looking around them at the evidence in the real world. We're told we need more supply by the economists, but the market is clearly saying that supply has reached demand (and maybe slightly exceeded it). We certainly need more rental supply, but that's a different issue.

In looking at my local area, properties that are in walk-in condition are selling relatively easily at prices roughly flat for 18 months, maybe back 2% or so. Properties that need extensive renovation aren't, and need substantial discounts to budge. It looks like a relatively "normal" market where prices go up or down by a percent or two a year.

SozBbz

hmmm wrote: »

Great post, fully agree.

If there's one thing the crash thought me, it is to ignore most economists. They're too busy looking at their models, and don't seem to spend enough time looking around them at the evidence in the real world. We're told we need more supply by the economists, but the market is clearly saying that supply has reached demand (and maybe slightly exceeded it). We certainly need more rental supply, but that's a different issue.

In looking at my local area, properties that are in walk-in condition are selling relatively easily at prices roughly flat for 18 months, maybe back 2% or so. Properties that need extensive renovation aren't, and need substantial discounts to budge. It looks like a relatively "normal" market where prices go up or down by a percent or two a year.

With respect, I think this is overly simplistic.

This is still very much a supply issues, just not a supply issue for fancy houses in DLR. The demand for such properties now matches the amount of people who could seriously buy them, ie have deposits and income to meet those prices.

There is plenty of demand still in other parts of the country which has not been satisfied and more building needs to happen - but it has to happen a)where people want to live b)whats built needs to be affordable within the macro prudential rules and c) they need to be practical properties.

Theres not just one property market, the country is made up of lots of different local submarkets. DLR has probably topped out, but I don't think thats true everywhere.

I do however agree that we should all get used to prices going up and down a bit - thats what should happen in a normal market.

Also agree that there is little value in fixer uppers, builders are too scarce and too expensive -why would you put yourself through it when you probably wouldnt be adding value.

Radsky

terrydel wrote: »

SozBbz wrote: »

I think perhaps theres a dip in value. New homes that are no longer brand new (5/10 years old) probably are a challenge to sell on because they've maybe lost their sparkle but aren't old enough to have character. Also if they're part of an estate, the estate itself maybe going through the difficult teen years so less attractive. Ultimately I think the area will make or break the chances of selling on such a house well.

I'm a 2nd hand house person all the way. also the areas I want to live in are mostly developed with much older stock. I also love character and a big back garden.

I know there are reasons for it, but the size of gardens in new builds is criminal. Garden is hugely important to me, I've two dogs that need the space and it is a place for myself and herself to relax and escape to. I'd buy a lesser house with a good garden over a better new build with a small back garden any day.

What would be considered a big garden? I see in many new builds garden sizes of around 70 sq meters? Would old houses typically have a much larger garden size than this?

hmmm

SozBbz wrote: »

With respect, I think this is overly simplistic.

This is still very much a supply issues, just not a supply issue for fancy houses in DLR. The demand for such properties now matches the amount of people who could seriously buy them, ie have deposits and income to meet those prices.

There is no part of the market showing large price increases. It is simplistic, but I'm going to believe the evidence in front of my eyes and not some model. Developers are finding it more difficult to shift stock and will not be building more in a rush, I don't see who is going to be building the extra 15,000 units to meet "projected" demand.

If for example the supply of credit was preventing people from buying, I'd expect to see cheaper properties plateauing at an excessive level. We're seeing perhaps a small bit of evidence of this, but nothing overwhelming. Credit restrictions are preventing excessive risk taking more than anything else, the system is working well.

What is obvious is massive supply issues in the rental market.

Graham

hmmm wrote: »

Developers are finding it more difficult to shift stock and will not be building more in a rush, I don't see who is going to be building the extra 15,000 units to meet "projected" demand.

I suspect developers are discovering the number of first time buyers who qualify for a 3.5 x exemption, looking for a 3-bed semi in the burbs or commuter towns is beginning to dwindle.

Time for the developers to start looking at slightly less profitable alternative markets to address.

hmmm

Graham wrote: »

Time for the developers to start looking at slightly less profitable alternative markets to address.

I think they have - they shifted to build-to-rent 3 years ago, and are looking at building co-living spaces for those who can't afford the semi-d (if the middle classes will let them). There's a massive market for cheap starter properties, but developers can't build them - lots of people now renting in a house share who would love a small 1 bed apartment of their own.

It'll be interesting to see if supply figures hold up over the next few years - I suspect if it isn't in a prime location there'll be a lack of developers willing to take chances. Hopefully the banks have also learned some lessons.

Mickiemcfist

hmmm wrote: »

I think they have - they shifted to build-to-rent 3 years ago, and are looking at building co-living spaces for those who can't afford the semi-d (if the middle classes will let them). .

Hmmm..not sure if you've looked into some of the co-living spaces available in Dublin. A couple of my colleagues live in them, out of curiosity I went to the one on Pembroke st. The guys that live there could comfortably, and I mean really comfortably afford to buy a south county Dublin Semi detached house. The reasons they are not buying one are many, however the primary two are: 1. Not committing to Ireland long term 2. Networking & socialising with other high earning, tech minded multicultural people is of interest to them.

lfen

Does the property price register include vat?

Interested Observer

lfen wrote: »

Does the property price register include vat?

There's no VAT on 2nd hand homes anyway but new builds no it does not.