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Is the 2008 Housing Crisis just an illusion? (US Media video in opening post)

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    #2
    mariaalice
    Registered Users Posts: 12,493 ✭✭✭✭mariaalice


    Eric Cartman wrote: »
    https://www.youtube.com/watch?v=GFkkN2M3Y3c

    a very good clip came up on youtube, its US based but very reflective of whats going on here.


    (1) people have to live somewhere

    (2) I would be certain that modern data analysis can pinpoint exactly who is most likely to be in danger of defaulting on a mortgage.

    The problem is want to do about discrimination leaving aside bad luck which can happen to anyone what do you do about lone parent applicants who are more vulnerable because of relying on one income, or those who do not have the educational qualifications or in-demand skills which means they can skip to London or Australia if there is a downturn here, or those with significant mental health issues which could mean they have extended periods of not working in their lives and so on.


    Had a conversation last Friday with my sister and her husband who were trunded down for a 36k Mortage 33 years ago at the time they were very upset and it took weeks for Mortgages decisions to be made and access to credit was very restricted are we to go back to that? both has permenant job.

    Are we to return to a socity of mass social housing? or are we to restrict homeownership to the wealthy middle class?


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    #3
    beauf
    Closed Accounts Posts: 22,648 ✭✭✭✭beauf


    mariaalice wrote: »
    ...Are we to return to a society of mass social housing? or are we to restrict home-ownership to the wealthy middle class?

    Bit simplistic there.

    We have always had mass social housing. Even now when its outsourced to the private market. But if you drive demand into small geographical area, (cities) then that area is going to be expensive. Likewise if you shrink supply with your economic policies.

    Our economic approach is the equivalent of driving with the foot on the brake and the accelerator at the same time.

    We need to go back and look how these issues were resolved historically.


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    #4
    fliball123
    Registered Users Posts: 7,450 ✭✭✭fliball123


    Assetbacked wrote: »
    But what about the fact there has been no supply for ten years? The rapid price increases from 2012 were solely based on demand increasing without supply catching up.

    The stories about the impending global downturn are just that at this stage; stories. The Irish economy is still predicted to grow strongly with Brexit not occurring or occurring with a deal (the two most likely outcomes currently). All combining to mean that quite simply prices should come down gradually once supply picks up. As for how much, that's not easy to say considering supply is very slowly starting to pick up but we still have more people arriving each week in Ireland to take up new jobs. What is essential is for the Central Bank to keep its rules to put a cap on borrowing as people will just borrow to pay more if they had the ability to do this, artificially inflating prices yet again. If prices are too high, they will need to come down to meet the affordability ceiling.




    In that 10 years births have fair outstripped deaths and there has been nett immigration inwards to the country year on year in that peiod. Not to mention the the factor of a huge world wide competition exploding in the last 10 years with REITS and foreign investors buying in bulk after looking at the rental yields. Look at what I said if i was a betting man. I would never advise anyone to buy or sell, I cant see a bust in the same shape as 2008 as the dymanics are different regardless of how brexit pans out.



    You also forget the option if prices are too high it means that the levels such as the 3.5 your wage and 20/80 can be tweaked. People wont sell unless they have to and if ever there was a country that dont do repossession its this country. But I am actually saying there will be a correction of about another 10% over the next 18months i cant see it going below that.. but its a finger in the air analysis I am no expert, you may be right?


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    #5
    OwlsZat
    Registered Users Posts: 1,511 ✭✭✭OwlsZat


    Eric Cartman wrote: »
    https://www.youtube.com/watch?v=GFkkN2M3Y3c

    a very good clip came up on youtube, its US based but very reflective of whats going on here.

    Properties are being held by banks in instead of selling and repossession rates have dropped. Is there any data available to test these hypothesis?


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    #6
    coolshannagh28
    Registered Users Posts: 1,478 ✭✭✭coolshannagh28


    OwlsZat wrote: »
    Properties are being held by banks in instead of selling and repossession rates have dropped. Is there any data available to test these hypothesis?

    Its an interesting one ; are banks and vulture funds manipulating the market in this way , anecdote would agree and numbers on vacant properties would indicate a trend https://www.cso.ie/en/releasesandpublications/ep/p-cp1hii/cp1hii/vac/ although this is not current . I would imagine that there may be many properties where owners in default are sitting tight as in the US .


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    #7
    drunkmonkey
    Registered Users Posts: 28,191 ✭✭✭✭drunkmonkey


    OwlsZat wrote: »
    Properties are being held by banks in instead of selling and repossession rates have dropped. Is there any data available to test these hypothesis?

    The banks seem to be off-loading them to funds/receivers, they seem to be the ones holding them back. From what I'm seeing myself they seem to be drip feeding them, as one goes sale agreed another is released onto the market.
    There not under any pressure to sell..releasing them all into the market together could cause a drop in house prices.
    So my theory, it's not the banks it's who there selling them to is keeping the market stable at the moment.


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    #8
    beauf
    Closed Accounts Posts: 22,648 ✭✭✭✭beauf


    mariaalice wrote: »
    ....Are we to return to a socity of mass social housing? or are we to restrict homeownership to the wealthy middle class?

    Lots of other places doing the same thing. People like to paint this as a solely Irish problem. It isn't.

    https://www.msn.com/en-ie/news/indepth/welcome-to-manc-hattan-how-the-city-sold-its-soul-for-luxury-skyscrapers/ar-AAJ6KwN?li=BBr5PkO
    “I’m sick of my city being strip-mined,” says Sam Wheeler, councillor for the Piccadilly ward, where the blocks are sprouting. “If you’re going to trash the nature of the area, but you’re doing it to address the housing crisis, maybe we could have a conversation. But these schemes aren’t even providing the homes Manchester desperately needs.”

    According to government figures, there are now almost 2,000 households living homeless in temporary accommodation in Manchester, a six-fold increase over the last five years. The city’s homeless population is more than 4,000, the highest rate in northern England, and nearly 13,500 households are on the social housing waiting list. How many social homes were built last year? Just 28.

    Yet Manchester is visibly booming. Cranes cluster across the skyline and the concrete liftshafts of future towers dot every corner....

    Sound familiar?


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    #9
    terrydel
    Closed Accounts Posts: 3,881 ✭✭✭terrydel


    Eric Cartman wrote: »
    https://www.youtube.com/watch?v=GFkkN2M3Y3c

    a very good clip came up on youtube, its US based but very reflective of whats going on here.

    How is that reflective?
    Blame the victims rather than the cause (banks and market driven economics).


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    #10
    terrydel
    Closed Accounts Posts: 3,881 ✭✭✭terrydel


    beauf wrote: »
    Bit simplistic there.

    We have always had mass social housing. Even now when its outsourced to the private market. But if you drive demand into small geographical area, (cities) then that area is going to be expensive. Likewise if you shrink supply with your economic policies.

    Our economic approach is the equivalent of driving with the foot on the brake and the accelerator at the same time.

    We need to go back and look how these issues were resolved historically.

    Theres nothing social about the private sector supplying this form of housing, its just a method of transferring money from the citizens to private enterprise.
    Our housing crisis is almost entirely a result of ideological decisions. That is an inalienable fact.


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    #11
    riddles
    Registered Users Posts: 1,102 ✭✭✭riddles


    If the state is obliged to “give people a home” then property should not be a commodity.


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    #12
    Wanderer78
    Registered Users Posts: 29,397 ✭✭✭✭Wanderer78


    riddles wrote: »
    If the state is obliged to “give people a home” then property should not be a commodity.

    Ah plenty of money to be made in housing, so ta hell with that


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    #13
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,285 Mod ✭✭✭✭The_Conductor


    riddles wrote: »
    If the state is obliged to “give people a home” then property should not be a commodity.

    The state is obligated to provide shelter to its people.
    It doesn't say anywhere it has to be 'a home', 'a house', 'an apartment' or any other dwelling type. Technically- a tent satisfies the state's obligation under the UN convention- and indeed, tents are used for shelter in some states- despite the inevitable misery they entail.

    Ireland handing people a house on a plate- is almost a unique construct.


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    #14
    Wanderer78
    Registered Users Posts: 29,397 ✭✭✭✭Wanderer78


    The_Conductor wrote:
    Ireland handing people a house on a plate- is almost a unique construct.


    On a plate, and public housing is only an Irish thing?


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    #15
    beauf
    Closed Accounts Posts: 22,648 ✭✭✭✭beauf


    terrydel wrote: »
    Theres nothing social about the private sector supplying this form of housing, its just a method of transferring money from the citizens to private enterprise.
    Our housing crisis is almost entirely a result of ideological decisions. That is an inalienable fact.

    Consider that the private sector refused this business. The govt had to change the law to force them to take it. They cap the rent. Then take half of it back in tax. They also avoid most of the risk and expense the private sector has to carry that as well. It's also not attracting landlords into the sector. Considering most reits concentrate at the high end of the market not the low end.

    So if it's a method of transferring money it's probably the worse possible system ever designed.


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    #16
    Wanderer78
    Registered Users Posts: 29,397 ✭✭✭✭Wanderer78


    beauf wrote: »
    Consider that the private sector refused this business. The govt had to change the law to force them to take it. They cap the rent. Then take half of it back in tax. They also avoid most of the risk and expense the private sector has to carry that as well. It's also not attracting landlords into the sector. Considering most reits concentrate at the high end of the market not the low end.

    So if it's a method of transferring money it's probably the worse possible system ever designed.

    the fire(finance, insurance and real estate) sectors are doing just fine out of this


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    #17
    beauf
    Closed Accounts Posts: 22,648 ✭✭✭✭beauf


    Wanderer78 wrote: »
    the fire(finance, insurance and real estate) sectors are doing just fine out of this

    The majority of their business isn't social housing. So this would only be true if they made vastly more profit on social housing than on private housing. Which is is highly unlikely. But if you have figures form an official side let's have them.

    You'd be far better looking at how other countries, Austria for example handle social housing, than all these meaningless tabloid sound bites.


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    #18
    Wanderer78
    Registered Users Posts: 29,397 ✭✭✭✭Wanderer78


    beauf wrote: »
    The majority of their business isn't social housing. So this would only be true if they made vastly more profit on social housing than on private housing.

    You'd be far better looking at how other countries, Austria for example handle social housing, than all these meaningless tabloid sound bites.

    come again?


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    #19
    beauf
    Closed Accounts Posts: 22,648 ✭✭✭✭beauf


    Wanderer78 wrote: »
    come again?

    What you posted makes no sense. Post some studies or figures that show that the business of social housing is more profitable than private housing.

    Your suggestion taken to it's logical conclusion is that if you sell less of less expensive product you'll make more money than selling a more of something more expensive.

    Also that these things aren't a cost to anyone who does it. By they the govt or a private company. That the govt and thus the taxpayer can provide these things for little or no cost.

    Considering they got out of it primarily as a cost saving strategy in the first place.


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    #20
    Wanderer78
    Registered Users Posts: 29,397 ✭✭✭✭Wanderer78


    beauf wrote: »
    What you posted makes no sense. Post some studies or figures that show that business of social housing is more profitable than private housing.

    Your suggestion taken to it's logical conclusion is that if you sell less of less expensive product you'll make more money than selling a more of something more expensive.

    should housing be a part of the profit market? its clearly obvious the fundamentals of 'the market', i.e. neoclassical theory, fails under certain circumstances, maybe its something to do with our reality of non linearities, non equilibriums and not so rational expectations from not so rational human beings, or maybe not


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    #21
    beauf
    Closed Accounts Posts: 22,648 ✭✭✭✭beauf


    Wanderer78 wrote: »
    should housing be a part of the profit market? its clearly obvious the fundamentals of 'the market', i.e. neoclassical theory, fails under certain circumstances, maybe its something to do with our reality of non linearities, non equilibriums and not so rational expectations from not so rational human beings, or maybe not

    I'll take that as you'll not be backing any of your comments with any factual information.

    You could equally suggest a cheaper way of doing it, based in the real world and not existentialism.


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    #22
    terrydel
    Closed Accounts Posts: 3,881 ✭✭✭terrydel


    beauf wrote: »
    Consider that the private sector refused this business. The govt had to change the law to force them to take it. They cap the rent. Then take half of it back in tax. They also avoid most of the risk and expense the private sector has to carry that as well. It's also not attracting landlords into the sector. Considering most reits concentrate at the high end of the market not the low end.

    So if it's a method of transferring money it's probably the worse possible system ever designed.

    You are talking about small, one property landlords. The state has designed a system to entice institutional landlords into the market, and allowed them to pay absolutely no tax once here. Do you seriously agree with that? It seems you do. Because you are always playing the poor landlord card, as if they are the ones hard done by. The rent cap was a far too late fig leaf to avoid mass homelessness, because the ideology of the government had created a situation were even well paid people couldn't afford to keep paying the insane rents. Had they built social or affordable homes in the first 6-7 years of their tenure they wouldn't have needed a rent cap. But they didn't because they left it too the market to fix the problem, and it never has any interest in doing so. The housing crisis we have is borne out of the ideology of our government almost entirely, that is a simple, undeniable fact. I know the government and it's cheerleaders like to pretend it's done kind of accident they can't control or didn't cause, but they did cause it, and could fix it if they wished but choose not to largely.


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    #23
    terrydel
    Closed Accounts Posts: 3,881 ✭✭✭terrydel


    beauf wrote: »
    The majority of their business isn't social housing. So this would only be true if they made vastly more profit on social housing than on private housing. Which is is highly unlikely. But if you have figures form an official side let's have them.

    You'd be far better looking at how other countries, Austria for example handle social housing, than all these meaningless tabloid sound bites.

    So you agree that the government has outsourced social housing to the private sector then? And you agree that we currently have the worst homelessness crisis in the history of the state (you cant really disagree with this as the stats are black and white)?
    So you agree then that the cause of this crisis is government ideology, as I stated earlier?


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    #24
    drunkmonkey
    Registered Users Posts: 28,191 ✭✭✭✭drunkmonkey


    The cause of the problem is putting all the jobs in the one place. Every other county is expected to give up their children to Dublin, a ludicrous situation born out of political fear.
    I take homeless figures with a pinch of salt as it's a pathway to a free house, I see it the whole time with an air b&b close by that takes in the homeless (aka those wanting a house). The quickest way to get your house is to declare yourself homeless. I asked a chap I know well what he was doing in the air b&b and he told me he had to declare himself homeless to get accommodation as he was never going to get somewhere living with his mum. (Who by the way is a widow with a 3 bed house).


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    #25
    terrydel
    Closed Accounts Posts: 3,881 ✭✭✭terrydel


    drunkmonkey wrote: »
    I take homeless figures with a pinch of salt as it's a pathway to a free house,.

    Thats an incredibly cynical view, based on one piece of anecdotal evidence.
    Are you suggesting that the crisis is somehow fabricated or heavily embellished? I find that staggering to be honest, and contemptible.


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    #26
    q85dw7osi4lebg
    Closed Accounts Posts: 3,502 ✭✭✭q85dw7osi4lebg


    terrydel wrote: »
    Thats an incredibly cynical view, based on one piece of anecdotal evidence.
    Are you suggesting that the crisis is somehow fabricated or heavily embellished? I find that staggering to be honest, and contemptible.

    It's common enough, have encountered people doing the exact same myself.


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    #27
    drunkmonkey
    Registered Users Posts: 28,191 ✭✭✭✭drunkmonkey


    terrydel wrote: »
    Thats an incredibly cynical view, based on one piece of anecdotal evidence.
    Are you suggesting that the crisis is somehow fabricated or heavily embellished? I find that staggering to be honest, and contemptible.

    Hold on I've just told you how I see the system working on a daily basis. It's not a fabrication, declaring yourself homeless is a pathway to a house. It's not one piece of evidence, I see plenty of people doing it. Go to the air b&b homeless end up with a house, that's how it works and that's why people are declaring themselves homeless, I'm not saying it's the same in all situations but it's 100% the case in what I've seen over the last few years.
    We have plenty of vacant houses but people want to be in a certain locations. If you can't provide yourself with shelter and are dependent on the state the location shouldn't matter. We're well able to send refugees to borrisokeane but how dare anyone suggest we should send Dubliners.


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    #28
    beauf
    Closed Accounts Posts: 22,648 ✭✭✭✭beauf


    terrydel wrote: »
    So you agree that the government has outsourced social housing to the private sector then? And you agree that we currently have the worst homelessness crisis in the history of the state (you cant really disagree with this as the stats are black and white)?
    So you agree then that the cause of this crisis is government ideology, as I stated earlier?

    That has always been my position.


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    #29
    terrydel
    Closed Accounts Posts: 3,881 ✭✭✭terrydel


    drunkmonkey wrote: »
    Hold on I've just told you how I see the system working on a daily basis. It's not a fabrication, declaring yourself homeless is a pathway to a house. It's not one piece of evidence, I see plenty of people doing it. Go to the air b&b homeless end up with a house, that's how it works and that's why people are declaring themselves homeless, I'm not saying it's the same in all situations but it's 100% the case in what I've seen over the last few years.
    We have plenty of vacant houses but people want to be in a certain locations. If you can't provide yourself with shelter and are dependent on the state the location shouldn't matter. We're well able to send refugees to borrisokeane but how dare anyone suggest we should send Dubliners.

    You obviously work in the system if you are seeing it on a daily basis.
    So you essentially think we dont really have a homeless crisis at all then?


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    #30
    beauf
    Closed Accounts Posts: 22,648 ✭✭✭✭beauf


    terrydel wrote: »
    ...Because you are always playing the poor landlord card, as if they are the ones hard done by. ....

    No I don't. That just a lazy stereotypical bias reply if someone points out the flaws in some of these far left tabloid sound bytes with no bias in reality. Or basic maths or economics. Why do you have stereotype people as on one side or the other.
    terrydel wrote: »
    You are talking about small, one property landlords. The state has designed a system to entice institutional landlords into the market, and allowed them to pay absolutely no tax once here. Do you seriously agree with that? It seems you do. Because you are always playing the poor landlord card, as if they are the ones hard done by. The rent cap was a far too late fig leaf to avoid mass homelessness, because the ideology of the government had created a situation were even well paid people couldn't afford to keep paying the insane rents. Had they built social or affordable homes in the first 6-7 years of their tenure they wouldn't have needed a rent cap. But they didn't because they left it too the market to fix the problem, and it never has any interest in doing so. The housing crisis we have is borne out of the ideology of our government almost entirely, that is a simple, undeniable fact. I know the government and it's cheerleaders like to pretend it's done kind of accident they can't control or didn't cause, but they did cause it, and could fix it if they wished but choose not to largely.

    Its not just this Govt either its successive Govts. I don't disagree with anything you've said about the Govt, that is actually what I always argue. Its not about Landlords. Thats just a lazy argument. No need to bring them into it at all.

    The issue Institutional landlords was well known before they became part of any discussion. They are also largely irrelevant. They are a small % of the market and mainly target the most profitable end of it. They will not fix the housing crisis, unless there is a change in policy. They will probably make it worse. Lots example of that.

    The issue is Govt policy. They have done a masterly job of misdirection, while doing almost nothing to fix the crisis. They will wait (as long as it takes) for the market to balance itself, then claim they fixed it.


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    #31
    q85dw7osi4lebg
    Closed Accounts Posts: 3,502 ✭✭✭q85dw7osi4lebg


    terrydel wrote: »
    You obviously work in the system if you are seeing it on a daily basis.
    So you essentially think we dont really have a homeless crisis at all then?

    Talk about selective comprehension.


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