Property Market 2020

limnam

Conrad83 wrote: »

Just to add an fyi.

I have 2 friends working in mortgages in 2 separate banks. Apparently this last week they are up the walls and back to 'pre covid times'. If this continues the huge price drops people are predicting may not materialise.

That itself doesn't mean much.


There's naturally going to be a big back log of people who put things off for a few months due to not been able to view etc


What will really impact is how the overall job loss damage is at the end.


There's also a large group of people who have been able to save a lot of money in the last few months.


Bit like when started coming out of recession there was a large glut of cash buyers, once they were gone it leveled off a bit.


If people in the wage bracket of small starter homes/apartments leave the market the owners of those can't get on the next "step"


What are the current unemployment figures looking like ?

awec

Cyrus wrote: »

It’s nothing to do with what I think

If they are new builds then the ppr for some reason shows the price net of vat , what the purchaser will have paid will have been the gross amount .

Because you don't pay VAT on second hand houses, so the VAT is removed on new houses to normalize the data.

The PPR also, I believe, only shows the prices of the house itself, and not the price of the land. Therefore it depends how the developer splits up the two within the final purchase price as to what will ultimately show on the PPR.

errlloyd

Even forgetting absolutely everything else, the withdrawal of LTI exemptions alone should knock prices at some stage.

Villa05

Dav010 wrote:

Don’t forget the greens, they want to remove sale of property as a cause for ending a tenancy, that will spook a lot of LLs/investors possibly increasing the numbers leaving the market and numbers of units for sale.

TheSheriff wrote:

I think people will start to value the house with a garden after this and we might see a resurgence in demand first in the suburbs /commuter belt before the city centre. Unfortunately there is still excessive demand for housing, that hasn't gone await and looking at the government's new program it is here to stay for the foreseeable future.

TheSheriff wrote:

We also potentially now have the unknown of FF/FG in government and the meddling they will no doubt do with the market.

You could nearly put your house on Mary Lou being the next leader after that combo

Dolbhad wrote:

I feel like we are in a bubble at the moment. It will be Christmas/New Year before we see any changes in prices. We will have a budget at that stage which will show the extent we have to repay for COVID and back to dealing with Brexit. Those who are still secure in their jobs will buy now while banks will lend an amount sufficient to buy a house and government is holding up the economy at the moment with the COVID payments.

Sorry for your loss
Good summation, saw the same behaviour in 07/08 even though people knew their jobs were at serious risk

TheSheriff

errlloyd wrote: »

Even forgetting absolutely everything else, the withdrawal of LTI exemptions alone should knock prices at some stage.

Is there any data for how many LTI exceptions are given out per annum, and their relative value?

I would have thought it would be quite a small number? But could be wrong.

brisan

Villa05 wrote: »

You could nearly put your house on Mary Lou being the next leader after that combo

If you could afford a house that is




Sorry for your loss
Good summation, saw the same behaviour in 07/08 even though people knew their jobs were at serious risk

Seeing how hard it is for banks to repossess property would you blame them

fliball123

Villa05 wrote: »

You could nearly put your house on Mary Lou being the next leader after that combo




Sorry for your loss
Good summation, saw the same behaviour in 07/08 even though people knew their jobs were at serious risk

I think the debate needs to be moved on here the same environment and properties do not exist in 2020 that did back in 08

We have a better structure on banking loans and mortgages
We have a better liquidity
We have a lower level of debt vs savings
We have a much higher demand for housing

Not saying there will be drop but I have been arguing for months since the start of this that no matter if its a pandemic, a crash or anything else. If the fundamental principals of supply and demand do not shift then price will not change. Supply has been taken off over the last number of months. It will be interesting to see how the next 3 months go.

Cyrus

awec wrote: »

Because you don't pay VAT on second hand houses, so the VAT is removed on new houses to normalize the data.

The PPR also, I believe, only shows the prices of the house itself, and not the price of the land. Therefore it depends how the developer splits up the two within the final purchase price as to what will ultimately show on the PPR.

that only relates to houses that are sold with acres, i think they take 1 acre as part of the house and seperate the rest, for the majority of houses sold in dublin its neither here nor there.

i understand the first point, its more from a user perspective most people are interested in what the house sold for, vat is only a consideration for the developers and the exchequer.

Cyrus

Villa05 wrote: »

You could nearly put your house on Mary Lou being the next leader after that combo

things will need to be VERY bad before big mary gets the top seat, she is dangerously imcompetent.

brisan

fliball123 wrote: »

I think the debate needs to be moved on here the same environment and properties do not exist in 2020 that did back in 08

We have a better structure on banking loans and mortgages
We have a better liquidity
We have a lower level of debt vs savings
We have a much higher demand for housing

Not saying there will be drop but I have been arguing for months since the start of this that no matter if its a pandemic, a crash or anything else. If the fundamental principals of supply and demand do not shift then price will not change. Supply has been taken off over the last number of months. It will be interesting to see how the next 3 months go.

Retailers gone so far
Debenhams
Coast
Warehouse
Oasis
Forever21
Mothercare

Hospitality sector in tatters due to Coronaphobia,social distancing rules and no music in pubs
Queens in Dalkey the first big name to go
Reports that 90% of restaurants will not be viable at 2m social distancing and 50% not viable at 1 m rule
Hotel industry struggling with no foreign tourists
Airline industry laying off staff and drastically reducing wages.
Commercial sector will struggle to get previous rents with increased WFH and less people allowed in to shops and browsing discouraged
How do you think this will affect incomes and therefore demand
every major worldwide financial institution is STATING not forecasting a recession ranging from the worst in 300 years to the worst since the foundation of the state
Dan O Brien of the Independent said this recession has the potential to make 2008 look like a blip
But Marian Finnegan (Managing Director of the Residential and Advisory dept of Sherry Fitzgerald ) predicts a SOFTENING of house prices so all will be grand
Buckle up we are in for a hell of a ride of our green party subsidised bikes in the next 12-18 months

TheSheriff

brisan wrote: »

Retailers gone so far
Debenhams
Coast
Warehouse
Oasis
Forever21
Mothercare

Hospitality sector in tatters due to Coronaphobia,social distancing rules and no music in pubs
Queens in Dalkey the first big name to go
Reports that 90% of restaurants will not be viable at 2m social distancing and 50% not viable at 1 m rule
Hotel industry struggling with no foreign tourists
Airline industry laying off staff and drastically reducing wages.
Commercial sector will struggle to get previous rents with increased WFH and less people allowed in to shops and browsing discouraged
How do you think this will affect incomes and therefore demand
every major worldwide financial institution is STATING not forecasting a recession ranging from the worst in 300 years to the worst since the foundation of the state
Dan O Brien of the Independent said this recession has the potential to make 2008 look like a blip
But Marian Finnegan (Managing Director of the Residential and Advisory dept of Sherry Fitzgerald ) predicts a SOFTENING of house prices so all will be grand
Buckle up we are in for a hell of a ride of our green party subsidised bikes in the next 12-18 months

You are the ultimate doom merchant as soon as anyone says anything to the contrary and you seem to take great joy in listing businesses which have gone bust.

We know we are in for a recession - chill out.

Padre_Pio

TheSheriff wrote: »

You are the ultimate doom merchant as soon as anyone says anything to the contrary and you seem to take great joy in listing businesses which have gone bust.

We know we are in for a recession - chill out.

Hope for the best, plan for the worst

SozBbz

brisan wrote: »

Retailers gone so far
Debenhams
Coast
Warehouse
Oasis
Forever21
Mothercare

Bit of a misleading list.

Both Coast and Forever21 went quite some time before Covid 19. There are always examples of retailers who run into trouble because for whatever reason they've lost touch with their consumer or they've made bad business decisions. Coast must be gone nearly a year and I'd say Forever 21 is more like 2 years ago if not more. Forever 21 is expanding in other countries, they just found Ireland didnt work for them. Perhaps their store was too big.

Warehouse/Oasis are the same company, but yes that was recent enough. I'd argue the Oasis brand had been struggling to connect for years - I'm probably in their target market but I wouldnt have dreamed of shopping there in recent years and neither do any of my friends. They'd lost touch. Warehouse didnt have many stores here, but they never seemed busy. As a brand I think they were a bit stronger than Oasis but possibly got dragged down, they did some interesting designer colabs over the past while so I think they were a bit more relevant.

Debenhams had been floundering for years and Mothercare UK went to the wall about 6 months ago, so neither of these were exactly surprising. I know personally I hadn't gone near Debenhams in years, there was something not quite right about their market positioning. Can't really speak to Mothercare as I don't have a baby, but I think maybe they'd gotten themselves trapped with massive rents or something.

Cyrus

brisan wrote: »

Retailers gone so far
Debenhams
Coast
Warehouse
Oasis
Forever21
Mothercare


Queens in Dalkey the first big name to go

you are being alarmist, all of those companies were in big trouble pre corona and it was just the straw that broke the camels back.

the queens has been quiet for a long time and its more like the owner is retiring rather than going out of business to be honest.

Queasy Tadpole

The doom and loom in this thread is not what I see on the ground.

Prices are the same, zero drops. We are looking to buy/sell at the same time so it doesn't really effect but it's interesting to see the properties being made available.

All coming back on the market at the same price 6+ months ago.

Markitron

Queasy Tadpole wrote: »

The doom and loom in this thread is not what I see on the ground.

Prices are the same, zero drops. We are looking to buy/sell at the same time so it doesn't really effect but it's interesting to see the properties being made available.

All coming back on the market at the same price 6+ months ago.

It seems to me that the people predicting a drop are predicting it for later this year or early next.

Queasy Tadpole

Yes of course but the initial shock of the pandemic is not being seen at the moment.

It's never the right time to buy but at the moment nothing has changed from the start of 2020.

19233974

Queasy Tadpole wrote: »

The doom and loom in this thread is not what I see on the ground.

Prices are the same, zero drops. We are looking to buy/sell at the same time so it doesn't really effect but it's interesting to see the properties being made available.

All coming back on the market at the same price 6+ months ago.

While i dont agree with the catastrophising some people are doing, we can not judge anything right now. We are still under restrictions and the economic impact wont be seen for another few months

But i think any one denying the inevitable economic fallout from this literally has their heads buried in the sand. How much it effects house prices is anyones guess due to the supply issue that is not going to be fixed by FF/FG.

We will have mini spikes in 2nd, 3rd waves etc. that is going to continue to disrupt the economy until we have a vaccine in a years time. We are already seeing some of these around the world. While life will go on, it will be a bumpy economic ride for the next year or so

Springy Turf

Does anyone have any data on house valuations vs. what they actually sold for? At the best of times, it seems to be like its pretty hard to guess more accurately than +/- 10%. There seem to be so many fickle variables - like for example how many serious bidders does a property have can make a huge difference. Near identical houses in the same estate can go for very different prices within weeks of each other. Now it's even harder to predict because there has been essentially no housing market for the last 2 months. Estate agents are just picking up where they left off in terms of pricing. By the end of the summer hopefully we will see what these houses actually sold for.

Personally, in my heart I just want to get a house bought in the next few months while my current mortgage approval is valid, but in my head, I am finding it pretty hard to ignore the economic uncertainty from Corona and our brevity neighbours.

Dolbhad

19233974 wrote: »

But i think any one denying the inevitable economic fallout from this literally has their heads buried in the sand. How much it effects house prices is anyones guess due to the supply issue that is not going to be fixed by FF

I agree with this. I’m expecting the economy to take a hit and house prices with it but I don’t know how bad it will be. I say the rules the bank have brought in last few years we will see will have work and won’t have people in severe negative equity. And we still do have a supply/demand issue. That may prevent a massive drop like the lows of 2013 but it won’t stop prices from dropping somewhat and we won’t have rises in prices.

Although we now have a house to sell, I was looking for a house to buy (so of course lower prices would suit me) before we were put on subsidy payments and told by banks we cannot move forward until we were off it. This will have the biggest impact - lending. I think that’s the rush now to buy while people have approvals in place and know what money they have to play around with. It seems banks criteria are changing on a daily basis.

People relying on exemptions (myself included) now have less money in the pot to spend on the house and anybody buying a new build off plans to complete next year will be worried about valuations.

Of course - no doubt the government will bring in something which was meant to help the market but will inadvertently make it worse.

TheSheriff

19233974 wrote: »

While i dont agree with the catastrophising some people are doing, we can not judge anything right now. We are still under restrictions and the economic impact wont be seen for another few months

But i think any one denying the inevitable economic fallout from this literally has their heads buried in the sand. How much it effects house prices is anyones guess due to the supply issue that is not going to be fixed by FF/FG.

We will have mini spikes in 2nd, 3rd waves etc. that is going to continue to disrupt the economy until we have a vaccine in a years time. We are already seeing some of these around the world. While life will go on, it will be a bumpy economic ride for the next year or so

Agree, far too early to tell anything at this point in time. It will likely be this time next year before we can say what way things are going.

Expect a long stand off between buyers and sellers if prices start to drop.

I know alot of people who have purchased in the past five years or so; I hope for their sake that the CB limits protect them from the financial ruin that is much talked about due to 2008.

There is also the fact that while there is vast unemployment, there are companies/industries which are booming. I've been shot down for saying this before, but I work in Pharma and my GF works in tech and we are busier than ever. GF's bonuses are up; I have recruiters calling looking for CVs as they have pending positions on the books due to the surge of CV-19; old drugs being ramped up in manufacture, new drugs, new devices etc.

Also consider anyone on a CV-19 subsidy, will they be the next glut of people looking to buy in 6 months (presuming they still have jobs).

A recession of some sort is inevitable - but I don't think it will effect everyone equally (not withstanding taxes etc.) . I think anyone who is not a cash buyer needs to be asking will they get a mortgage during said recession or will they be caught renting for several more years. The big difference this time is that we don't have tens of thousands of half built units ready to flood the market.

We've debated this ourselves countless times over the past number of months.

Someone mentioned something on this thread which stuck with me, that unfortunately buying a property in Ireland feels like you are walking into a betting shop.

There are so many aspects which interplay its difficult to predict anything concrete.

OwlsZat

TheSheriff wrote: »

There is also the fact that while there is vast unemployment, there are companies/industries which are booming. I've been shot down for saying this before, but I work in Pharma and my GF works in tech and we are busier than ever. GF's bonuses are up; I have recruiters calling looking for CVs as they have pending positions on the books due to the surge of CV-19; old drugs being ramped up in manufacture, new drugs, new devices etc.

It's bad taste.

A friend of mine was talking to a pal of his who runs a bus tour company. Needless to say the bus tour owner is in dire financial straits. He was lamenting that one of his supposed friends was insensitive enough to spend 15 minutes to him complaining on the phone about how he wouldn't get his 5k bonus this year. If you're in an industry doing well, great, just no need to shout about it at a time many others are struggling.

TheSheriff

OwlsZat wrote: »

It's bad taste.

A friend of mine was talking to a pal of his who runs a bus tour company. Needless to say the bus tour owner is in dire financial straits. He was lamenting that one of his supposed friends was insensitive enough to spend 15 minutes to him complaining on the phone about how he wouldn't get his 5k bonus this year. If you're in an industry doing well, great, just no need to shout about it at a time many others are struggling.

Agree - it is a bad taste, and its not my intention to; but there are posters here listing the businesses which have gone bust and how they will impact the property market. When the reality is there is also a counter argument that nobody wants to hear.

OwlsZat

TheSheriff wrote: »

Agree - it is a bad taste, and its not my intention to; but there are posters here listing the businesses which have gone bust and how they will impact the property market. When the reality is there is also a counter argument that nobody wants to hear.

If you can present it in some sort of empirical form then I'd say people are all ears. Saying myself and my girlfriend are flying on it's own isn't evidence of much.

SozBbz

TheSheriff wrote: »

Agree - it is a bad taste, and its not my intention to; but there are posters here listing the businesses which have gone bust and how they will impact the property market. When the reality is there is also a counter argument that nobody wants to hear.

It would be bad taste to drone on about how well you're doing to a friend who you know is in trouble.

Its not bad taste to share your own real world experience in a discussion forum, especially in light of exaggerated doom and gloom posts, who are retrospectively seeking to cite covid19 as a reason why certain retailers closed down up to 2 years ago.

cunnifferous

No slowdown that im seeing anyway. Last place i bid 7% below asking which wasn't a speculative low ball offer by any means, it needed a lot of work done to it. A day later a bid at asking comes in.

It seems only a mass extinction event (or lots of supply) will dent Irish property prices in the near term. Im quite suprised how much money is still floating around the market tbh.

TheSheriff

OwlsZat wrote: »

If you can present it in some sort of empirical form then I'd say people are all ears. Saying myself and my girlfriend are flying on it's own isn't evidence of much.

But its not doom and gloom, therefore not reported in the media.

Its a reality tough, often ignored on this board by those who want to take any macro-event and fit it to the "properties will crash" narrative. A few months back it was Brexit.

Undoubtedly property prices will come down in Ireland; it would be foolish to think otherwise in light of Covid, but by how much and for how long is a real unknown.

This idea of not mentioning that many people still have jobs and some industries are booming because its "bad taste" and may offend those who have lost their jobs takes from the discussion. This will have an impact on the length/dept of any recession.

19233974

SozBbz wrote: »

It would be bad taste to drone on about how well you're doing to a friend who you know is in trouble.

Its not bad taste to share your own real world experience in a discussion forum, especially in light of exaggerated doom and gloom posts, who are retrospectively seeking to cite covid19 as a reason why certain retailers closed down up to 2 years ago.

Strangely enough even the parts of the medical world are majorly struggling. Aside from the aesthetics clinics which have taken a major hit, a lot of GP practices that relied heavily on private income have seen this side of the business drop off a cliff.

So it has definitely had major impacts across the board, some good, some bad

christin

There are some sectors which are naturally more robust during recessions, healthcare and pharmaceuticals being the classic example. Their products are always in demand. It is a very tough time for some people at the moment so it is good for us to remember everyone in society. I think the retail sector will be changed forever after the virus. No one can say with certainty what will happen in the housing market, except that a price fall is on the cards. The economy is being supported at the moment so we have not yet returned to the "steady state" normality where trends would be easier to see.

hometruths

TheSheriff wrote: »

But its not doom and gloom, therefore not reported in the media.

Its a reality tough, often ignored on this board by those who want to take any macro-event and fit it to the "properties will crash" narrative. A few months back it was Brexit.

Undoubtedly property prices will come down in Ireland; it would be foolish to think otherwise in light of Covid, but by how much and for how long is a real unknown.

This idea of not mentioning that many people still have jobs and some industries are booming because its "bad taste" and may offend those who have lost their jobs takes from the discussion. This will have an impact on the length/dept of any recession.

I don't think it is bad taste in the slightest - just stating facts in context, completely fair enough.

But I think it is misguided to think that doomsters are ignoring it and taking "any macro-event and fit it to the "properties will crash" narrative".

Part of the problem with the discussion here is posters are not looking at the macroenvironment seriously, both at a national and international level.

My view is that macro factors will cause properties to crash sooner or later, rather than trying to take macro factor and fit it to my gloomy narrative.

But whenever anyone tries to have a discussion along the lines of property prices are going to take a hammering because the ESRI says the Irish economy faces largest recession in history, a pile of posters will say "Nonsense, sure John and Mary are flying and still planning on buying this year."

Which sounds a lot like ignoring the macro, taking any positive micro event and fitting it to the "property prices won't go down/will stabilise, this time it's different" narrative.