Property Market 2020

lcwill

Smouse156 wrote: »

Give it time! Rents fall first, then the apartment prices will fall in tandem as investors will pay less if the outlook is poor and will want steady/higher yields. That will drag house prices down over the medium term. 10% drop by this time next year is realistic. Property takes time to fall.

https://bl.ocks.org/pinsterdev/raw/234b4a5310a14a32e080/

Hi Smouse, this is a great chart, do you put this data together? Do you have something similar for house prices and availability for sale?

Iceman29

I just used a car as an example. I could have used apples or oranges.....Didn't think the recession deniers would go to such length to cling on to their fantasy as to bring up depreciation.....

Anyway the point was that people will want to sell now rather than wait for the inevitable massive price drop.

Hubertj

Iceman29 wrote: »

I just used a car as an example. I could have used apples or oranges.....Didn't think the recession deniers would go to such length to cling on to their fantasy as to bring up depreciation.....

Anyway the point was that people will want to sell now rather than wait for the inevitable massive price drop.

I would eat orange instead of selling them. Good source of vitamin c.

I don’t see anyone in this thread denying there will be a fall in prices, debate is by how much. Economists analysis seems to range from 5%-25% from what I have read. However, I really really do believe boards is a more credible source of information.

combat14

Smouse156 wrote: »

Give it time! Rents fall first, then the apartment prices will fall in tandem as investors will pay less if the outlook is poor and will want steady/higher yields. That will drag house prices down over the medium term. 10% drop by this time next year is realistic. Property takes time to fall.

https://bl.ocks.org/pinsterdev/raw/234b4a5310a14a32e080/

great chart interesting to see rents for 3 bed houses have already fallen back by 3.5 years to Jan 2017 - rents are still too high..
interesting to see if they drop more over the next period of time

wassie

Hubertj wrote: »

I don’t see anyone in this thread denying there will be a fall in prices, debate is by how much. Economists analysis seems to range from 5%-25% from what I have read. However, I really really do believe boards is a more credible source of information.

The fact there is such a spread in predicted price falls is a reflection of just how uncertain the immediate future is.

Personally I want to see a couple of months of data after Phase 4 before I make any purchasing decisions.

Assetbacked

Hubertj wrote: »

I would eat orange instead of selling them. Good source of vitamin c.

I don’t see anyone in this thread denying there will be a fall in prices, debate is by how much. Economists analysis seems to range from 5%-25% from what I have read. However, I really really do believe boards is a more credible source of information.

For buying and selling, I don't see a price fall at the price range typical FTBs are buying at (for me this would be up to 500k, maybe even a bit more) - we still have our housing crisis and, to be honest, the issue for FTBs has been a lack of turnkey properties within this price range, not the price. There's still far too many people hoping for prices to fall which to me indicates that there are plenty of people in a good position with the luxury of looking to buy hence why they want prices to fall.

Above 1m is where there could be a meaningful fall in prices, but at the same time 10% or even 20% once you go over a million is hefty but not a crash. And the high estimates of property prices falling seem to be 20/30% so, taking into account the extreme estimates, I don't see 1.5m dropping to 1.2m as being that dramatic (30% drop). Or 1.8m dropping to 1.4m as being a "crash".

SozBbz

Assetbacked wrote: »

For buying and selling, I don't see a price fall at the price range typical FTBs are buying at (for me this would be up to 500k, maybe even a bit more) - we still have our housing crisis and, to be honest, the issue for FTBs has been a lack of turnkey properties within this price range, not the price. There's still far too many people hoping for prices to fall which to me indicates that there are plenty of people in a good position with the luxury of looking to buy hence why they want prices to fall.

Above 1m is where there could be a meaningful fall in prices, but at the same time 10% or even 20% once you go over a million is hefty but not a crash. And the high estimates of property prices falling seem to be 20/30% so, taking into account the extreme estimates, I don't see 1.5m dropping to 1.2m as being that dramatic (30% drop). Or 1.8m dropping to 1.4m as being a "crash".

Higher end property is always harder to predict anyway, because the pool of potential buyers is smaller, and they're unlikely to be buying their first homes so there is often less urgency.

I agree, I think turkey property sub 500k is going to get really problematic. New builds will trickle off (unless the state steps in, which they might to make it worth builders whille despite the other risks in the market) so buyers will be left with the 3 D's (Divorceing, Desperate and Dead - and the third category especially are not known for leaving behind turn key property.)

awec

Iceman29 wrote: »

I just used a car as an example. I could have used apples or oranges.....Didn't think the recession deniers would go to such length to cling on to their fantasy as to bring up depreciation.....

Anyway the point was that people will want to sell now rather than wait for the inevitable massive price drop.

I think you still don't really understand what's being said if this is what you think.

awec

Dub4747 wrote: »

True but I can say that as someone who needs to sell a house in order to buy a bigger one, we're being advised by almost everyone to sell now and if we can get a good price just take it and close the deal as prices will fall. So sell and then rent and be there ready to go, ready to buy and not in a chain.

Have you run the numbers to figure out what doing this will cost you?

It's good to get advice from a variety of sources, but make sure you have worked it out for yourself. It is certainly not an automatic case of sell now, buy later = profit.

Hubertj

combat14 wrote: »

great chart interesting to see rents for 3 bed houses have already fallen back by 3.5 years to Jan 2017 - rents are still too high..
interesting to see if they drop more over the next period of time

I think the data needs to show how many units are actually being let to give it more context.
Also why do you think rents are still too high? What level should they be at?

awec

Assetbacked wrote: »

For buying and selling, I don't see a price fall at the price range typical FTBs are buying at (for me this would be up to 500k, maybe even a bit more) - we still have our housing crisis and, to be honest, the issue for FTBs has been a lack of turnkey properties within this price range, not the price. There's still far too many people hoping for prices to fall which to me indicates that there are plenty of people in a good position with the luxury of looking to buy hence why they want prices to fall.

Above 1m is where there could be a meaningful fall in prices, but at the same time 10% or even 20% once you go over a million is hefty but not a crash. And the high estimates of property prices falling seem to be 20/30% so, taking into account the extreme estimates, I don't see 1.5m dropping to 1.2m as being that dramatic (30% drop). Or 1.8m dropping to 1.4m as being a "crash".

Yes, this is a particularly strange phenomenon. "I am going to wait so I can buy my house on the cheap."

If this ends up being the reality there will be no bargains. It implies demand remaining steady.

stinger31

Iceman29 wrote: »

I just used a car as an example. I could have used apples or oranges.....Didn't think the recession deniers would go to such length to cling on to their fantasy as to bring up depreciation.....

Anyway the point was that people will want to sell now rather than wait for the inevitable massive price drop.

This is exactly the situation that myself and the OH are in. We're selling and cashing in now. otherwise we'll be kicking ourselves. We've spoken to EA ,parents and in fact all our close friends (some are doing the same). The opinion is the same with every single person agreeing that huge reductions are on the way. So we're going with it and if we get near our asking we'll be happy.

I personally see the sh1t hitting the fan in the next few month and want out now.

fliball123

stinger31 wrote: »

This is exactly the situation that myself and the OH are in. We're selling and cashing in now. otherwise we'll be kicking ourselves. We've spoken to EA ,parents and in fact all our close friends (some are doing the same). The opinion is the same with every single person agreeing that huge reductions are on the way. So we're going with it and if we get near our asking we'll be happy.

I personally see the sh1t hitting the fan in the next few month and want out now.

I would be careful with this approach I don't think there will be a great selection of properties coming on board while prices are going down. With the protections this country has against repossession of the family home you will find yourself bargain basement hunting for air bnb and ex rentals and it could be sometime before you find a property suitable for your needs and the price point on these may be on rebound depending on the timescale

Assetbacked

Hubertj wrote: »

I think the data needs to show how many units are actually being let to give it more context.
Also why do you think rents are still too high? What level should they be at?

I think rents should be a fraction of salaries (as workers are predominantly the renters). Based on what seems to be the current average salary, it should be possible to rent (approximately) a studio apartment in Dublin for €500/600; a habitable 1 bedroom apartment for €1000 (obviously not in the city centre); 2 bedroom apartment for €1300 (again not in the city centre).

When people are paying 30%+ of their after tax salaries just to cover their rent, the economy suffers in a big way as it is essentially dead money as it is a big chunk which is funnelled up to a small portion of society (or even to investors who are not even based in Ireland), when it would be better to be spread out throughout the more active economy (i.e. pubs, shops, car dealerships, hotels, supermarkets etc.). It's also better for the general wellbeing of people to be able to rent their own place, it teaches them to be responsible, it's easier to meet partners ("Come back to my place" instead of, "I can't bring you back to mine as my roommate is home") and is an incentive to work hard. What is toxic is to not even have the option of moving away from the city centre in order to rent a cheaper place and what is utterly soul-destroying is having to share a bedroom with another adult.

Politically, it is obvious this is the single biggest issue among the younger generations (i.e. those under 40) and therefore it is important to realise that the market will be poked and probed even more from the political establishment in an attempt to establish more affordable rents so it isn't just economic arguments we need to consider in the context of the rental market discussions!

fliball123

Assetbacked wrote: »

I think rents should be a fraction of salaries (as workers are predominantly the renters). Based on what seems to be the current average salary, it should be possible to rent a studio apartment in Dublin for €500/600; a habitable 1 bedroom apartment for €1000 (obviously not in the city centre); 2 bedroom apartment for €1300 (again not in the city centre).

When people are paying 30%+ of their after tax salaries just to cover their rent, the economy suffers in a big way as it is essentially dead money as it is a big chunk which is funnelled up to a small portion of society, when it would be better to be spread out throughout the more active economy (i.e. pubs, shops, car dealerships, hotels, supermarkets etc.). It's better for general wellbeing for people to be able to rent their own place, it teaches them to be responsible and grown up; and is an incentive to work hard. What is toxic is to not even have the option of moving away from the city centre in order to rent a cheaper place and what is utterly soul-destroying is having to share a bedroom with another adult.

Politically, it is obvious this is the single biggest issue among the younger generations (i.e. those under 40) and therefore it is important to realise that the market will be poked and probed even more from the political establishment in an attempt to establish more affordable rents so it isn't just economic arguments we need to consider in the context of the rental market discussions!

The 2 are kind of linked what you earn will determine how much you can pay on rent/mortgage. I would be for taxing people more like companies and allowing you to pay out essential expenses such as rent/mortgage, ESB, travel and food before paying any tax that way the worker gets at the very least his/her essentials before paying for anyone else's welfare.

Rents are always unpredictable and people will always want to live in better areas. I mean look at the likes of New York and London rents are bonkers when you compare them to Dublin. I am waiting for the Dublin is no New York or London argument, yet a high % of the population would want to live close to Dublin due to work opportunities and higher levels of amenities and you can bet the majority of foreign people coming into the country would prefer to live in Dublin so increase demand always brings price points up. There are plenty of cheap rentals down in Leitrim if you want cheap

GreeBo

Iceman29 wrote: »

Do you not understand? if i knew that prices would fall and wanted to sell, I'd sell as fast as i can.

Pretty simple like

Allow me to interpret your suggestion:
If I was flying in a plane and I knew the plane was going to crash at some stage in the future, I'd jump out of the plane now, just in case I'm on it when it crashes.

:rolleyes:

Assetbacked

fliball123 wrote: »

The 2 are kind of linked what you earn will determine how much you can pay on rent/mortgage. I would be for taxing people more like companies and allowing you to pay out essential expenses such as rent/mortgage, ESB, travel and food before paying any tax that way the worker gets at the very least his/her essentials before paying for anyone else's welfare.

Rents are always unpredictable and people will always want to live in better areas. I mean look at the likes of New York and London rents are bonkers when you compare them to Dublin. I am waiting for the Dublin is no New York or London argument, yet a high % of the population would want to live close to Dublin due to work opportunities and higher levels of amenities and you can bet the majority of foreign people coming into the country would prefer to live in Dublin so increase demand always brings price points up. There are plenty of cheap rentals down in Leitrim if you want cheap

But Dublin is not like Paris or New York as we have sprawling suburbs and relatively low density. There is plenty of space in the capital to build 3-5 storey blocks of apartments throughout the suburbs and space to build even close to the city centre hence the massive amounts of planning permissions which have gone through the planning system in the past couple of years and right up until the covid crisis.

Iceman29

GreeBo wrote: »

Allow me to interpret your suggestion:
If I was flying in a plane and I knew the plane was going to crash at some stage in the future, I'd jump out of the plane now, just in case.

:rolleyes:

Maybe more like the plane was crashing and there was limited parachutes on a plane.....

GreeBo

Assetbacked wrote: »

But Dublin is not like Paris or New York as we have sprawling suburbs and relatively low density. There is plenty of space in the capital to build 3-5 storey blocks of apartments throughout the suburbs and space to build even close to the city centre hence the massive amounts of planning permissions which have gone through the planning system in the past couple of years and right up until the covid crisis.

We dont have transport links to support high density suburbs, we cant even support current housing estate density.

If you want to support medium/high density then its either within the city centre or on rapid public transport links.

fliball123

GreeBo wrote: »

Allow me to interpret your suggestion:
If I was flying in a plane and I knew the plane was going to crash at some stage in the future, I'd jump out of the plane now, just in case.

:rolleyes:

Good analogy the fact is no one knows what way this will shake out. No 2 recessions are the same and the thing that throws the cat amongst the pigeons is the no repossessions in this country if this changed then I would say definite price drops but while everyone is losing jobs and taking cuts they will be allowed stay in their house for as long as they want and why would you sell at a loss when you can sit on your hole not paying your mortgage.

stinger31

Iceman29 wrote: »

Maybe more like the plane was crashing and there was limited parachutes on a plane.....

nicely played

fliball123

Assetbacked wrote: »

But Dublin is not like Paris or New York as we have sprawling suburbs and relatively low density. There is plenty of space in the capital to build 3-5 storey blocks of apartments throughout the suburbs and space to build even close to the city centre hence the massive amounts of planning permissions which have gone through the planning system in the past couple of years and right up until the covid crisis.

All very true and yet there is still a lot of foreigners and nationals who want to live there (go figure) hense the high levels of rent

errlloyd

fliball123 wrote: »

Why would you sell at a loss when you can sit on your hole not paying your mortgage.

Because you'll destroy your credit rating and doom yourself to never getting another mortgage right?

fliball123

errlloyd wrote: »

Because you'll destroy your credit rating and doom yourself to never getting another mortgage right?

Ok well let me ask you this you have lost your job , no sign of a new one coming, xmas coming down the line and little billy wants the G.I Joe with the kung fu grip, you and wife are at each others throats trying to sort out other bills, do you really think in this situation you will give a flying f what your credit rating is like when you know you can sit there in your gaff at the very least safe and sheltered without having to pay the mortgage ??? A lot of people will be in this dilemma. Also you wouldnt need another mortgage you wont be turfed out of the family home

Assetbacked

GreeBo wrote: »

We dont have transport links to support high density suburbs, we cant even support current housing estate density.

If you want to support medium/high density then its either within the city centre or on rapid public transport links.

In less than an hour you can get from most of Dublin into the city centre during rush hour, again, unlike London where under an hour is considered good going even with their excellent transport system. So I'm not sure if rapid transport is necessary as much as frequent transport (more darts, buses and Luas) and fully segregated, high quality cycling/escooter lanes instead of the ridiculous situation of allowing cars drive the whole way in past the canals during rush hour!

High density in the city centre will bring more of the workers out of the suburbs which will alleviate capacity issues on public transport in any event, which means there won't be a mass exodus to the medium density apartment buildings out in the suburbs resulting in overwhelming demand on public transport.

The Belly

As we move through the phases one element is becoming clear unemployment is going to remain very high across all sectors of the economy.

The V recovery seems very unlikely. Business closure and redundancies will be the order of the day over the coming months as demand falls domestically and globally.

In the past emigration would be the next stage as it always was before but this is not an option now either.

The housing and rental crisis that we were in before was put on hold but it will be worse as the new reality becomes clear.

The next government to be voted in will be elected on housing.

Social housing used to be for the working class and unemployed. This is not the case anymore.

A whole new cohort of voters will water down the boomer and public sector voter in the next election. We had a glimpse of this with the surge in voters for Sinn Fein.

There will be no exodus of trades men to Australia or the UK as there was before.

Money is cheap and will be cheap for the government to borrow for a long time to come. The excuse of there won't be the people to build them or the money to finance them won't cut it with voters.

Once this commences it will have the effect of bringing your average 3-4 bed semi in your average estate down to close to the price of a state built 3-4 bed semi.

So if a 3-4 bed is let say is 300k now and direct built affordable housing in a estate across the road are building them for 200k that will be the guide price.

Of course there will always be a premium for certain areas. But large scale social housing will drive down the prices of both private new builds and the second hand market.

Assetbacked

fliball123 wrote: »

All very true and yet there is still a lot of foreigners and nationals who want to live there (go figure) hense the high levels of rent

Yeah, Dublin has experienced a boom since 2015 in foreign workers coming into the country, but what is ridiculous is seeing these workers joining together to rent 3 bedroom houses out in the suburbs as they can't rent in the city centre close to work, pubs, etc. These houses then become completely unaffordable for families who are renting.

JimmyVik

Hubertj wrote: »

I would eat orange instead of selling them. Good source of vitamin c.

I don’t see anyone in this thread denying there will be a fall in prices, debate is by how much. Economists analysis seems to range from 5%-25% from what I have read. However, I really really do believe boards is a more credible source of information.

Heres my plan.

Im ready to go on 12.5%.
As prices fall I will have my finger on the trigger and bid for whatever properties I have my eye on.
If it falls further, no matter. If it doesnt fall im stuck.

JimmyVik

stinger31 wrote: »

This is exactly the situation that myself and the OH are in. We're selling and cashing in now. otherwise we'll be kicking ourselves. We've spoken to EA ,parents and in fact all our close friends (some are doing the same). The opinion is the same with every single person agreeing that huge reductions are on the way. So we're going with it and if we get near our asking we'll be happy.

I personally see the sh1t hitting the fan in the next few month and want out now.

Are you planning on buying again when prices start to rise? After the drop of course.


Where are you going to be living while you wait? What will the rent cost you?

JimmyVik

Assetbacked wrote: »

I think rents should be a fraction of salaries (as workers are predominantly the renters). Based on what seems to be the current average salary, it should be possible to rent (approximately) a studio apartment in Dublin for €500/600; a habitable 1 bedroom apartment for €1000 (obviously not in the city centre); 2 bedroom apartment for €1300 (again not in the city centre).

When people are paying 30%+ of their after tax salaries just to cover their rent, the economy suffers in a big way as it is essentially dead money as it is a big chunk which is funnelled up to a small portion of society (or even to investors who are not even based in Ireland), when it would be better to be spread out throughout the more active economy (i.e. pubs, shops, car dealerships, hotels, supermarkets etc.). It's also better for the general wellbeing of people to be able to rent their own place, it teaches them to be responsible, it's easier to meet partners ("Come back to my place" instead of, "I can't bring you back to mine as my roommate is home") and is an incentive to work hard. What is toxic is to not even have the option of moving away from the city centre in order to rent a cheaper place and what is utterly soul-destroying is having to share a bedroom with another adult.

Politically, it is obvious this is the single biggest issue among the younger generations (i.e. those under 40) and therefore it is important to realise that the market will be poked and probed even more from the political establishment in an attempt to establish more affordable rents so it isn't just economic arguments we need to consider in the context of the rental market discussions!

You have to separate that into area though.
If you want to base it on average salary, then it should be the average salary of the pool of people who would be looking to rent that property in that area.
You cant use a national average salary to base rental prices in Dublin city center from.