Property Market 2020

lomb

Gaurantors are out they don't accept them. Your parents could also if they have it lend or gift you the 60k difference. Another solution is buy something needing work for a lower mortgage and then get a personal loan later to fix it. Obviously this is alot dearer and damages your cash flow.

Assetbacked

https://www.irishtimes.com/business/economy/rents-in-the-state-rise-at-slowest-rate-in-six-years-1.4234349?mode=amp

Some very positive news from the RTB, that Q4 2019 saw rents decline from Q3, although for the full 12 months they were still up (albeit at a slower rate to previous years). This is all pre-covid19 of course.

Villa05

Graham wrote:

While I' wouldn't necessarily disagree with the predictions/forecasts/estimates/guesses, they are still predictions/forecasts/estimates/guesses.

This is a thread on the property market 2020. It's all relevant

GreeBo wrote:

The top 20% is still a lot of people though...and they are the ones most likely to be moving around and upsizing IMO.

You have a big problem when ftb are priced out of the market. Very few will be in the top 20% and many of the top 20 live and work outside Dublin

GreeBo wrote:

It's significant to the banks involved, I dont think its significant to the cost of housing. How many of these houses are actually coming on the market due to repossessions? Effectively none.

The extent of bad debts will affect how much a bank can lend, a recession will add further to those bad debts

Property prices are heavily influenced by bank lending

awec wrote:

Looking forward the policy toward mortgage arrears here is very unlikely to change, especially if you consider the sentiment in recent election results.

awec wrote:

Governments run a mile from this stuff. No party will advocate for change here. There is no appetite for repossessions in Ireland. At best you'd get support to go after the chancers who refuse to pay anything, the 10-year-no-cents-paid crowd.

There is 20,000 mortgages 5 years or more behind



Problems swept under the carpet during boom times have nasty habit of tripping you up in the bad times

Hubertj

schmittel wrote: »

The average value of the 27,000 720+ days outstanding mortages (not including arrears owed) is just over €200k - certainly suggests a fair chunk of them would be on Dublin going by value.




There are currently 60,596 mortgages with a value of €10.2 billion (not including arrears) that are currently in arrears to some extent.

That represents 8% of the number of mortgage account holders or 10% of the value of all mortgages.

If you include the mortgages arrears that have been restructured/recapitalised/written off etc it is 145,000 with a value of €21 billion - 19.5% of account holders and 20% of the value of mortgages.

The figures don't lie, but they are not widely publicised/discussed/understood.

So what are the implications? Doesn't appear to be bankruptcy.

https://www.centralbank.ie/statistics/data-and-analysis/credit-and-banking-statistics/mortgage-arrears

Never realised how many were in arrears or of possible knock on implications. However there looks like some positives in the report - 5k restructuring agreeements in q4 is a decent %. It must show banks are putting a lot of effort into addressing and that many in arrears are engaging n the process. Will be interesting to see what the report looks like in 2021.
Surely people not engaging will have to be targeted in future.

SteelyDanJalapeno

Will the severe recession mentioned in yesterday's news affect the cost of housing here? The sentiment from sellers seems like "no", but from buyer's "yes"?

JimmyVik

Hubertj wrote: »

Never realised how many were in arrears or of possible knock on implications. However there looks like some positives in the report - 5k restructuring agreeements in q4 is a decent %. It must show banks are putting a lot of effort into addressing and that many in arrears are engaging n the process. Will be interesting to see what the report looks like in 2021.
Surely people not engaging will have to be targeted in future.

A lot of people werent paying while the house the outstanding debt was so much hiogher than the sale value of the property. No point in the bank making a move then. They were waiting for the value of the house to rise before swooping. The people in arrears knew this and were advised on the likelihood of losing the property. And only engaged when it becoame viable for the banks to do something.


Well now if property values fall then banks will be back to square one and the people who dont pay mortgages will now start the same sh1t over again.

handlemaster

SteelyDanJalapeno wrote: »

Will the severe recession mentioned in yesterday's news affect the cost of housing here? The sentiment from sellers seems like "no", but from buyer's "yes"?

Does a severe recession affect the cost of housing. No nothing to see here LoL. Of course it does, this affects everything. WFP need more money and food or 30 million plus will die over the next few months. The US is writing blank cheques to keep the illusion its business as usual. 10 million workers have signed to get assistance that's 50 % of the work force. Ireland will have unemployment climbing also .. dont know where it is not I'd imagine around 10 % plus.

The reality is buyer or seller it affects both sides. Buyers will have less cash and access to funds. Same for sellers.. we are all in this together

JimmyVik

SteelyDanJalapeno wrote: »

Will the severe recession mentioned in yesterday's news affect the cost of housing here? The sentiment from sellers seems like "no", but from buyer's "yes"?

Of course it will.

But will people even get a mortgage? What happens when you get a nice hefty paycut to your mortgage application?

Are the banks now looking forward to all their customers getting pay cuts, or paying higher taxes? What will they do with their offer amounts?

How many properties will stay on the market or come to the market?

Will purchase chains fall apart and collapse?
Will builders stop building new houses?


Its all up in the air. There is no way to tell how the chips will fall at this time.

Pivot Eoin

Neighbour of ours, fairly central in Rathmines (Leinster Road) was given the option to drop asking price or take it off the market for the time being yesterday by their EA.

They were selling a relatively modern 3-Bed Mews for 790k asking (Overpriced anyway IMO) but now going off the market.

Link: https://www.dng.ie/residential/brochure/7-louis-lane-leinster-road-rathmines-dublin-6-d06x923/4407994

SteelyDanJalapeno

SteelyDanJalapeno wrote: »

Will the severe recession mentioned in yesterday's news affect the cost of housing here? The sentiment from sellers seems like "no", but from buyer's "yes"?

A severe recession?
How would it not affect the market?
It will affect everything!

TheW1zard

I heard on the radio that if youre behind on your mortgage you can restructure to market value.
So if prices crash, those still in negative equity and behind could adjust to suit. Which is good i think.

Zenify

SteelyDanJalapeno wrote: »

Will the severe recession mentioned in yesterday's news affect the cost of housing here? The sentiment from sellers seems like "no", but from buyer's "yes"?

In recessions banks lend less money. There is more unemployment so less buyers. General sentiment is down. Very few reasons for property not to fall in a recession. Investors will come in at some stage with cash and start to increase prices again but cash investors wont buy at the top.

What usually happens in a recession is building slows down and this also limits supply (increasing price) but building looks like it's going to stay due to political reasons. The people want housing in ireland. Whether they will be able to deliver, time will tell.

In conclusion, nobody really knows. If you look at history, house prices usually decline with a recession.

Zenify

TheW1zard wrote: »

I heard on the radio that if youre behind on your mortgage you can restructure to market value.
So if prices crash, those still in negative equity and behind could adjust to suit. Which is good i think.

Good for the irresponsible mortgage holder. Bad for everyone else who covers their cost to the bank.

JimmyVik

TheW1zard wrote: »

I heard on the radio that if youre behind on your mortgage you can restructure to market value.
So if prices crash, those still in negative equity and behind could adjust to suit. Which is good i think.

Watch interest rates go way up so.

Villa05

TheW1zard wrote:

I heard on the radio that if youre behind on your mortgage you can restructure to market value. So if prices crash, those still in negative equity and behind could adjust to suit. Which is good i think.

Was that radio in oz or the real world?

Hubertj

Zenify wrote: »

In recessions banks lend less money. There is more unemployment so less buyers. General sentiment is down. Very few reasons for property not to fall in a recession. Investors will come in at some stage with cash and start to increase prices again but cash investors wont buy at the top.

What usually happens in a recession is building slows down and this also limits supply (increasing price) but building looks like it's going to stay due to political reasons. The people want housing in ireland. Whether they will be able to deliver, time will tell.

In conclusion, nobody really knows. If you look at history, house prices usually decline with a recession.

other thing to consider is how "short lived" this recession will be (if that happens). Fairly punchy growth forecast in 2021 and into 2022. I presume growth was nowhere near this after 2008. From a property perspective, that could lead sellers to pause for 12-18 months thinking things will at least stabilise by then?

eagle eye

Hubertj wrote:

other thing to consider is how "short lived" this recession will be (if that happens). Fairly punchy growth forecast in 2021 and into 2022. I presume growth was nowhere near this after 2008. From a property perspective, that could lead sellers to pause for 12-18 months thinking things will at least stabilise by then?

People in a healthy financial situation with no urgency to sell can take the chance that things will improve in the long term and take their properties off the market. I don't think there's a whole pile of them though.

awec

SteelyDanJalapeno wrote: »

Will the severe recession mentioned in yesterday's news affect the cost of housing here? The sentiment from sellers seems like "no", but from buyer's "yes"?

The sentiment from everyone is yes.

A few sellers suggested if the prices drop they’ll just leave the market. If this is a common sentiment then supply issues will maintain a floor on property prices, and any reductions will be slow.

A few buyers suggested that if prices drop, sellers will sell in a hurry. If this happens prices will trend downward faster.

awec

eagle eye wrote: »

People in a healthy financial situation with no urgency to sell can take the chance that things will improve in the long term and take their properties off the market. I don't think there's a whole pile of them though.

It will be most home owners.

I don’t know why people think that anyone who ends up in financial trouble is going to sell their home. Yea, there’ll be some who do it, but for the most part this doesn’t happen.

Rightly or wrongly, people will wait it out, go into arrears with a view to clearing the arrears in future.

Investors are the ones who’ll sell off.

If someone needs to move they will sell. Even if they sell for 50 grand less they should be able to buy their next home for 50 grand less too.

TheW1zard

Villa05 wrote: »

Was that radio in oz or the real world?

Newstalk yesterday!

hometruths

TheW1zard wrote: »

I heard on the radio that if youre behind on your mortgage you can restructure to market value.
So if prices crash, those still in negative equity and behind could adjust to suit. Which is good i think.

Do you have a mortgage or might you be looking for one in the future?

TheW1zard

schmittel wrote: »

Do you have a mortgage or might you be looking for one in the future?

I have one yes, a very affordable one thankfully.
The guy on the radio yesterday mentioned some 20,000 people who are five years behind on their payments, so who are engaging with their bank presumably. The option to revalue was for them he said.

JimmyVik

eagle eye wrote: »

People in a healthy financial situation with no urgency to sell can take the chance that things will improve in the long term and take their properties off the market. I don't think there's a whole pile of them though.

Normally I would have thought that landlords looking to sell might now stay as landlords until sale prices recover.
I dont think so though. I think landlords are going to be hit very hard in this. Both by some sort of new legislation to go on top of all the other legislation that has battered both them and a normal rental market over the years, and loss of rent now due to Covid-19.


In short. The whole thing is all over the place and I change my mind hourly on how I see it all playing out

JimmyVik

awec wrote: »

It will be most home owners.

I don’t know why people think that anyone who ends up in financial trouble is going to sell their home. Yea, there’ll be some who do it, but for the most part this doesn’t happen.

Rightly or wrongly, people will wait it out, go into arrears with a view to clearing the arrears in future.

Investors are the ones who’ll sell off.

First thing people do when things ahead show signs of being bleak is batton down the hatches. Anyone thinking of taking on more debt than they already have (trader uppers), I would think will bail out of the sale and not trade up at all. This might leave properties at the top end of the trader upper chain on the market and willing to sell at a lower price, but more likely will take all of the lower priced properties out of the market as the dominos in the chain begin to fall.


So all you'll be left with on the market are discounted high end houses.

fliball123

awec wrote: »

The sentiment from everyone is yes.

A few sellers suggested if the prices drop they’ll just leave the market. If this is a common sentiment then supply issues will maintain a floor on property prices, and any reductions will be slow.

A few buyers suggested that if prices drop, sellers will sell in a hurry. If this happens prices will trend downward faster.

its a bit more than a few that are leaving the market it is/or will be the majority of sellers who will be pulling today again myhome has less properties for sale today than it did yesterday and that's with some properties added just today. I have been saying this since the start of Corona that people are solely looking at demand and forgetting the mechanisms that property owners have in this country. Just think about this fact, if your a home owner in this country you and your partner can lose both your jobs, have built up debt for your Porsche on a personal loan, have little Jimmy and young Ruby go to private schools and both owning their own pony not to mention Mum Judys 7 day a week subscription to palates that cost a few grand. The fact is no matter how rich, poor or indifferent you are the banks cannot take the family home, the poor have no options and the rich have lawyers who can hide everything. There is not one party in government who would have the scrotum to tackle this problem and it is a big problem as the tax payer will have to step in if it gets too bad.

I am not happy about this situation by the way but this in effect takes almost 100% of owner occupier homes off the market for a fire sale. As why would you sell when you can live rent free in your own house for 10 years plus? Anyone any idea what % of properties are owner occupier?

rosmoke

Since everyone is playing the guessing game I'll tag along.

1. Demand will obviously be weaker as suddenly many people lost their job or will loose it soon.
2. Construction will stop/slow down.
3. Jobs market will fall from a cliff.
4. Income tax will probably stay the same but interest rates will skyrocket.

What do you think it will happen when interest rates go up even by 1%?

fliball123

JimmyVik wrote: »

Normally I would have thought that landlords looking to sell might now stay as landlords until sale prices recover.
I dont think so though. I think landlords are going to be hit very hard in this. Both by some sort of new legislation to go on top of all the other legislation that has battered both them and a normal rental market over the years, and loss of rent now due to Covid-19.


In short. The whole thing is all over the place and I change my mind hourly on how I see it all playing out

Landlords are already paying full tax so 51% does to the tax man not to mention property tax, home & life insurance, mortgage. I don't think there is much room to maneuver here. Maybe the reits and vultures who I think are only paying 25% I could be wrong in this but I thought I seen that tax rate being bandied about for what they pay

fliball123

rosmoke wrote: »

Since everyone is playing the guessing game I'll tag along.

1. Demand will obviously be weaker as suddenly many people lost their job or will loose it soon.
2. Construction will stop/slow down.
3. Jobs market will fall from a cliff.
4. Income tax will probably stay the same but interest rates will skyrocket.

What do you think it will happen when interest rates go up even by 1%?

Supply is falling just as quickly as demand

voluntary

rosmoke wrote: »

What do you think it will happen when interest rates go up even by 1%?

Interest rates will only be going down in the foreseeable future. The prices are falling down, raw materials are falling down, OIL is falling down, everything is falling down. Inflation is a no-issue at the moment.