Property Market 2020

Mic 1972

schmittel wrote: »

That graph looks a lot like you're suggesting prices are currently higher than they were in 2007.

Which is almost as ridiculous as saying locations with better public transport should be cheaper than those without.

Which is almost as ridiculous as saying it doesn't make a difference whether you bought a property in 2005 or 2008.

I don't think anyone on here is expecting you to blindly follow their opinion, when you are quite clearly too busy blindly following your own.

Italy, Spain, France are just some example of European countries were the property market is no longer growing, it goes up and down only

Edgware

Claw Hammer wrote: »

Some people may take the opportunity to trade up.

Trade ups, trade downs, executor sales where a family wants to sell so that each beneficiary gets their share , people under pressure. Recession or boom there are always sales and opportunity for deals. Then there will be the people who dont need to sell and will just withdraw

Claw Hammer

Claw Hammer wrote: »

There are always executor sales, family break ups and repossessions and landlords throwing in the towel. Wen someone trades up it releases their own house.

As I earlier said, exceptional cases. The good stock isn't going to be for sale. We can see that with less property available for sale.

MrMusician18

GreeBo wrote: »

"Pontificating", because I don't share your doom and gloom outlook?
You need to learn to argue without being petulant in your posts.


I and others have been asking for days for people to define how they are calling property overvalued. The answers have ranged from "go look at London" to "dont look at London", so forgive me for not blindly following the opinion of some on this thread.

Btw, as I have shown before, long term property price trends are always up, so remind me again how they show property to be overvalued?

The market price of something doesn't represent it's value. Enron shares were priced at $80 a share at the end of 2000 but we're priced at near zero at the end of 2002. Their value throughout that period was zero. It was a Fortune magazine article that questioned how the company made money and whether or not it was overvalued that brought it down at that point.


So, again, price and value are not the same things.
In housing, the long term trend is always up because of the time value of money among other influences, but that doesn't mean that that value of property is always up. Property can increase in price in absolute terms but not in value. When we look at value in house prices we therefore tend to frame it the context of multiples of the average wage.

To be fair the concept of value and worth can be quite nebulous and what represents value to one individual might not to another.

When the spot price of property deviates substantially from long term averages and and salary metrics it tends to point to an overvalued market. Like in early 2020, and 2007.

OwlsZat

Mic 1972 wrote: »

We have been speculating about a potential decline in property prices since the beginning of Covid in Jan/Feb
It's now almost June and no sings of trend changes are being detected. It may too early but I think it's strange. Viewings have started again, asking prices are higher than last year.
During the last recession the market started to drop almost at the same time as jobs were being lost

While they last the COVID19 payments will paper over the cracks.

Mic 1972

Cupatae wrote: »

I dont see why it would change, the markets basically cornered, people are profiting massively.. they will maintain this situation, keep the demand high and the prices higher.

Its a incredible good housing situation in Ireland atm for certain people to exploit. Ideal conditions for profiting.

What I think is keeping the market strong at the moment are all the people who think they can get a bargain who end up bidding over each other for very high prices. Asking prices are set high to preempt the initial low offers so there is really no effect whatsoever. I have no idea how this situation can be sustained with so many people out of jobs and most having their salary reduced by more than 50%

Mic 1972

OwlsZat wrote: »

While they last the COVID19 payments will paper over the cracks.

People on Covid payments arent going to buy a house unless they have cash

Claw Hammer

Deleted User wrote: »

As I earlier said, exceptional cases. The good stock isn't going to be for sale. We can see that with less property available for sale.

So people with good houses don't die, divorce or go broke? Interesting.

GreeBo

Oliver Fisher wrote: »

economist.com/finance-and-economics/2018/08/11/our-cities-house-price-index-suggests-the-property-market-is-slowing (I can't post the full URL, sorry.)

According to The Economist, Dublin prices are 25% overvalued against income.

I have never stated that house prices have not outpaced incomes.

That doesn't mean that house prices are "overvalued" in general, in my opinion.

fliball123

GreeBo wrote: »

I have never stated that house prices have not outpaced incomes.

That doesn't mean that house prices are "overvalued" in general, in my opinion.

How do we not know if incomes are not correct and people should be paid more?? no one knows the price of anything except what someone is willing to accept and what someone is willing to pay

GreeBo

MrMusician18 wrote: »

The market price of something doesn't represent it's value. Enron shares were priced at $80 a share at the end of 2000 but we're priced at near zero at the end of 2002. Their value throughout that period was zero. It was a Fortune magazine article that questioned how the company made money and whether or not it was overvalued that brought it down at that point.

Other than what it costs to build, how else do you ascribe value to property?
And even that totally ignores land prices, which are the most significant driver of house prices.

BTW Those valueless Enron shares could have been sold during that period for their share price. Can you tell the difference between $80 the sale of Enron shares vs $80 withdrawn from a bank?
I'm pretty sure lots of people bought lots of things on the back of their Enron shares, sounds like value to me.
Also, what value does gold have? Or Oil, or any commodity for that matter?

So, again, price and value are not the same things.
In housing, the long term trend is always up because of the time value of money among other influences, but that doesn't mean that that value of property is always up. Property can increase in price in absolute terms but not in value. When we look at value in house prices we therefore tend to frame it the context of multiples of the average wage.

Ah, but I'm not saying they are the same thing. You are saying that house prices are over valued since they have increased faster than wages. This is comparing averages to averages and coming up with facts. Do you think the prices in Shrewsbury Road have increased faster than the incomes of those residents?

To be fair the concept of value and worth can be quite nebulous and what represents value to one individual might not to another.

Indeed. One person might pay more than another due to aspect, since they value aspect more.

When the spot price of property deviates substantially from long term averages and and salary metrics it tends to point to an overvalued market. Like in early 2020, and 2007.

But isnt that really saying that its only overvalued retrospectively? i.e. its only when the prices drop that one can say that they were overvalued. If they never drop below X then you cannot really say that X is an overvalued position.

MrMusician18

Mic 1972 wrote: »

We have been speculating about a potential decline in property prices since the beginning of Covid in Jan/Feb
It's now almost June and no sings of trend changes are being detected. It may too early but I think it's strange. Viewings have started again, asking prices are higher than last year.
During the last recession the market started to drop almost at the same time as jobs were being lost

This is not quite right. The employment market peaked in Q3 2007, and the property market stalled for about 6 months. We then had a dead cat bounce and then the market went into freefall until mid 2012, and prices have been recovering since then.

The stock market leads the employment market by about 6 months and the employment market leads the property market by about 6 months -generally.

The reason however we haven't seen an immediate impact on sales and prices is because the market is locked. When there are no transactions, there is no market price.

Claw Hammer

Claw Hammer wrote: »

So people with good houses don't die, divorce or go broke? Interesting.

Can you not read?

the only people who will sell now are either under HUGE financial pressure (i.e. about to get their house repossessed after a 9 year battle with the Banks!) or selling as part of a will/probate or are going to die soon and want to settle some affairs.

Seriously, what part are you struggling with?

GreeBo

fliball123 wrote: »

How do we not know if incomes are not correct and people should be paid more?? no one knows the price of anything except what someone is willing to accept and what someone is willing to pay

Its an interesting point, perhaps employees in Dublin are undervalued rather than Dublin property being overvalued

cnocbui

GreeBo wrote: »

Its an interesting point, perhaps employees in Dublin are undervalued rather than Dublin property being overvalued

More likely taxation is leaving a large segment of prospective buyers with scarcely two coins left to rub together.

GreeBo

Mic 1972 wrote: »

Italy, Spain, France are just some example of European countries were the property market is no longer growing, it goes up and down only

France


Spain


Italy is a basket case of an economy and I wouldnt use it to try to prove anything.

fliball123

cnocbui wrote: »

More likely taxation is leaving a large segment of prospective buyers with scarcely two coins left to rub together.

That also comes in to the equation the over taxation of employment and the very low levels that it kicks in. Wages here are no indicator of what property is worth. I mean look at the US look at new york nearly half new yorkers cant afford to live in new york with prices and other variables yet this has absolutely phuck all impact on prices. I would hazard a guess the same would be found for other major cities like London, Paris etc

https://ny.curbed.com/2019/3/21/18275604/nearly-half-nyc-cant-afford-ny-state-quinnipiac-poll

GreeBo

cnocbui wrote: »

More likely taxation is leaving a large segment of prospective buyers with scarcely two coins left to rub together.

Same tax anywhere in Ireland though, unless you mean that its taking more cash from people in Dublin due to higher wages?

hometruths

MrMusician18 wrote: »

This is not quite right. The employment market peaked in Q3 2007, and the property market stalled for about 6 months. We then had a dead cat bounce and then the market went into freefall until mid 2012, and prices have been recovering since then.

The stock market leads the employment market by about 6 months and the employment market leads the property market by about 6 months -generally.

The reason however we haven't seen an immediate impact on sales and prices is because the market is locked. When there are no transactions, there is no market price.

And Dublin houses lead the national property market, particularly South Dublin houses.

House prices in Dublin were falling last year - well before Covid. The lockdown is going to accelerate the falls in Dublin and nationwide.



https://www.irishtimes.com/business/construction/property-prices-rise-at-lowest-level-since-economic-recovery-1.4113172

Mic 1972

GreeBo wrote: »

France


Spain


Italy is a basket case of an economy and I wouldnt use it to try to prove anything.

completely different graphs in here


https://www.globalpropertyguide.com/Europe/France/Price-History

Mic 1972

schmittel wrote: »

And Dublin houses lead the national property market, particularly South Dublin houses.

House prices in Dublin were falling last year - well before Covid. The lockdown is going to accelerate the falls in Dublin and nationwide.



https://www.irishtimes.com/business/construction/property-prices-rise-at-lowest-level-since-economic-recovery-1.4113172

A few objections here


1. the property market was falling last year but it has been growing since the beginning of 2020, you linked an article from almost 6 months ago

2. the market was locked for viewings only and just for a few weeks. Viewings have started again, Estate Agents will easily catch up on backlog if there is demand


having said that I'm the first one to be surprised, as after all the loom and gloom about the economy I would have expected a negative trend to start showing the first sings by now

hometruths

Mic 1972 wrote: »

A few objections here


1. the property market was falling last year but it has been growing since the beginning of 2020, you linked an article from almost 6 months ago

2. the market was locked for viewings only and just for a few weeks. Viewings have started again, Estate Agents will easily catch up on backlog if there is demand


having said that I'm the first one to be surprised, as after all the loom and gloom about the economy I would have expected a negative trend to start showing the first sings by now

1. the property market was falling last year but it has been growing since the beginning of 2020, you linked an article from almost 6 months ago

Most recent figures from CSO show that Dublin City houses, Dun Laoghaire Rathdown houses, and South Dublin houses fell in the year to March 2020

2. the market was locked for viewings only and just for a few weeks. Viewings have started again, Estate Agents will easily catch up on backlog if there is demand

See point 1. Don't expect the floodgates to open releasing pent up demand for houses in Dublin.

fergus1001

Mic 1972 wrote: »

having said that I'm the first one to be surprised, as after all the loom and gloom about the economy I would have expected a negative trend to start showing the first sings by now

It has public finances are 30 billion in deficit and people are and will continue to loose jobs meaning less cash in the economy and less potential customers to buy over inflated houses

Mic 1972

fergus1001 wrote: »

It has public finances are 30 billion in deficit and people are and will continue to loose jobs meaning less cash in the economy and less potential customers to buy over inflated houses

Agree with all of that, but still no sings of property market decline.
I've been monitoring the 1bed market fora while, I haven't seen any change whatsoever. I also cancelled one viewing last week because they had already 3 people going and there were already offers for higher than asking price. I'm still expecting things to change in the future but at the moment the market seems mostly unaffected

Mic 1972

schmittel wrote: »

1. the property market was falling last year but it has been growing since the beginning of 2020, you linked an article from almost 6 months ago

Most recent figures from CSO show that Dublin City houses, Dun Laoghaire Rathdown houses, and South Dublin houses fell in the year to March 2020

2. the market was locked for viewings only and just for a few weeks. Viewings have started again, Estate Agents will easily catch up on backlog if there is demand

See point 1. Don't expect the floodgates to open releasing pent up demand for houses in Dublin.

the link you provided also shows that prices increased in the rest of Dublin and most of Ireland

hometruths

Mic 1972 wrote: »

the link you provided also shows that prices increased in the rest of Dublin and most of Ireland

And the reason I provided the first link was it stated the point that Dun Laoghaire Rathdown prices are a bellwether for the entire market - i.e they drop first when the market turns.

Hence the comment in the first post - "And Dublin houses lead the national property market, particularly South Dublin houses"

This is a trend that started in April 2019 and has continued since. Which is curious because supposedly we have an undersupply.

But you're probably right, nothing to see here. Buy now.

Graham

schmittel wrote: »

Dun Laoghaire Rathdown prices are a bellwether for the entire market

says who other than the IT? First time I've heard it.

hometruths

Graham wrote: »

says who other than the IT? First time I've heard it.

No idea who specifically says DLR is a bellwether for the market other than the IT.

But hindsight shows us that SCD houses lead the market - up and down.

Hubertj

what i don't understand is with the number of experts on board.ie how have the systemic problems with the property sector not been resolved by now?

Cupatae

Mic 1972 wrote: »

What I think is keeping the market strong at the moment are all the people who think they can get a bargain who end up bidding over each other for very high prices. Asking prices are set high to preempt the initial low offers so there is really no effect whatsoever. I have no idea how this situation can be sustained with so many people out of jobs and most having their salary reduced by more than 50%

People are always going to need a place to live tho, they ve the prices driven up so high, even now they make a mint, they dont have to sell cause theirs recession.