Irish Property Market 2020 Part 2

handlemaster

We have all forgotten about brexit , the pound is down in value bad for exports and good for imports. It hasn't gone away. Time.delay on property here is become more evident

Lolle06

brisan wrote: »

And yes you were elitist when you said lower paid workers losing their jobs would not have an impact on the property market
As I pointed out a worker on 30k a year losing their job takes 105k out of a potential mortgage
2 x 30k workers losing their jobs and their is a brand new 3 bed house in Portlaoise that has one less potential buyer

I know that „lower paid workers“ do marry „higher paid workers“! It wasn’t me, who called it „marrying above their station“, it was you.
That was my point.

I also know, that couples who earn unter 50k annually have a difficult time getting onto the property ladder. Especially if they have children.

You always refer to a low paid worker and a high paid worker being a couple.
That’s not what I mean by a couple on a low income.

Not every „low paid worker“ is living in Portlaoise, so I don’t know why they would buy a house there?

Do you think that the government created the Rebuilding Ireland Home loan scheme for couples who earn up to 75k or single earners unter 50k for no specific reason?

Btw - can you pls point me towards my quote, where I said that ppl losing their jobs (no matter the income really), would have no influence on property prices? Because I believe it wasn’t me that said it.

Marius34

schmittel wrote: »

So no maths mistakes, which is something I guess.

If total number of ads on myhome is not a good number to measure, what number

You are right is not the math problem, I just was not expecting that you take total adds from whatever times, which includes old, but counted for 2020 Q2, but only transactions that are for 2020 Q2 only.

Total number of myhome adds it's good number to measure. It's bad to compare in terms transactions vs supply, in particular for short term.
Let say there is added monthly 1.000 new adds each month, where it get's sold 2.000 monthly. It's obviously there is more demands than supplies for that time, add wise.

Normally the shorter period of time you take, the less change you will get in percent for total number of adds, where is not a case for transactions. For times when suddenly everything gets "frozen", you would see no change in "supply", but none existing "demands".Which would be very different from reality.

I was replying to a post specifically asking about the supply in that short term. And all of the above is exactly why I did not say hey look demand has dropped twice as much as supply, or some other nonsense. I simply pointed out that those figures do not exactly scream tight supply, which they don’t.

Ok, but you chose number what suits you, without much interest which really growing faster supply or demand, as most in here.
I don't have real answer to it, but I could provide a very different result, that would show strongly my right. In Same myhome report, states new listing fell by 85%:
"Figure 3 illustrates new listings for
sale on the MyHome website. During
April and May, these fell to circa 85% of
levels in 2019 but in recent weeks have
picked up to levels just 20% below. ""

Of course we may soon see this, or possibly we may soon see that, on the other hand we could see the other. And of course it would make more sense to compare 1 year from lockdown.

But whenever anybody posts an opinion on here on what they think might happen over the next year, they’re scoffed at because they’re always saying wait and see, and apparently demand is sky high right now and we are in the midst of chronic undersupply, right now.

It's great if anyone post their opinion, and wants to share or understand the market.
Same as me I want to understand the market and where is it going.
The problem than many picking up some numbers that best suit to them, and interpret in their own way, for the sake to prove their own believes.

hometruths

Given that there is only 2 of them it could be argued that supply is tight for homes on Highfield Road, Rathgar that are "completed to a spec more typical of grand contemporary designs in London or New York"

But at €3.25m each it will be interesting to see what the demand is

Marius34

schmittel wrote: »

Supply falling faster than demand. Or demand rising faster than supply.

Either of those would probably do it.

But developers dropping prices, and transaction volumes, mortgage approvals, mortgage drawdowns all falling in record numbers does not exactly scream tight supply to me.

You want to talk about what has happened over the last decade, and Marius wants to talk about what will happen over the next year, but my post that you’ve both taken exception to was about what happened in Q2 2020!

no, that's not what I said, I explained in previous comment, that the numbers you provided is not suitable to compare with change in transactions for relatively short period.

Cyrus

schmittel wrote: »

Given that there is only 2 of them it could be argued that supply is tight for homes on Highfield Road, Rathgar that are "completed to a spec more typical of grand contemporary designs in London or New York"

But at €3.25m each it will be interesting to see what the demand is

nice houses, imo they are an easier sell than the similar cheaper ones built in blackrock recently.

Hubertj

schmittel wrote: »

Given that there is only 2 of them it could be argued that supply is tight for homes on Highfield Road, Rathgar that are "completed to a spec more typical of grand contemporary designs in London or New York"

But at €3.25m each it will be interesting to see what the demand is

A fcuking lift.

beauf

Hubertj wrote: »

A fcuking lift.

Better than a stair lift if you need it.

Eric Cartman

Hubertj wrote: »

A fcuking lift.

you could buy a detached house on a massive plot of land on Aylesbury road and still have enough left over to buy a holiday house in almost any part of the country https://www.daft.ie/dublin/houses-for-sale/ballsbridge/rockville-house-1a-ailesbury-road-ballsbridge-dublin-2061831/

or install a lift yourself....

hometruths

Marius34 wrote: »

Total number of myhome adds it's good number to measure. It's bad to compare in terms transactions vs supply, in particular for short term.

Again, I'll reiterate I understand the short time period problem, which is why I did not make any concrete assertions, i said 'doesn't exactly scream tight supply'

Marius34 wrote: »

Let say there is added monthly 1.000 new adds each month, where it get's sold 2.000 monthly. It's obviously there is more demands than supplies for that time, add wise.

I agree that's clearly nonsense because you are measuring new supply vs existing demand. My comments were about total supply compared to total demand.

Marius34 wrote: »

Ok, but you chose number what suits you, without much interest which really growing faster supply or demand, as most in here.
I don't have real answer to it, but I could provide a very different result, that would show strongly my right. In Same myhome report, states new listing fell by 85%:
"Figure 3 illustrates new listings for
sale on the MyHome website. During
April and May, these fell to circa 85% of
levels in 2019 but in recent weeks have
picked up to levels just 20% below. "

At the risk of repeating myself, that's clearly nonsense because you are measuring new supply vs existing demand. My comments were about total supply compared to total demand.

New demand in that time period fell off a cliff as well. Look at the mortgage approval numbers.

Marius34 wrote: »

It's great if anyone post their opinion, and wants to share or understand the market.
Same as me I want to understand the market and where is it going.
The problem than many picking up some numbers that best suit to them, and interpret in their own way, for the sake to prove their own believes.

Indeed.

Genuine question - there is a lot of chat on here about undersupply and demand well in excess of existing supply/new supply etc etc - if you were to measure supply/demand trends over a meaningful period (1 year) - how would you do it?

hometruths

schmittel wrote: »

You want to talk about what has happened over the last decade, and Marius wants to talk about what will happen over the next year, but my post that you’ve both taken exception to was about what happened in Q2 2020!

Marius34 wrote: »

no, that's not what I said, I explained in previous comment, that the numbers you provided is not suitable to compare with change in transactions for relatively short period.

Really? Apologies I must have misunderstood the following comment:

Marius34 wrote: »

Ok, I see you looking at total existing adds. Wouldn't think it's a good number to measure, in particular for relatively short term. It would make more sense to compare in at least 1 year from lockdown.

Marius34

schmittel wrote: »

I agree that's clearly nonsense because you are measuring new supply vs existing demand. My comments were about total supply compared to total demand.



At the risk of repeating myself, that's clearly nonsense because you are measuring new supply vs existing demand. My comments were about total supply compared to total demand.

that's not right of "existing demands". Because the longer period you take, the larger existing demands you get. Transactions in itself includes supplies and demands.

Genuine question - there is a lot of chat on here about undersupply and demand well in excess of existing supply/new supply etc etc - if you were to measure supply/demand trends over a meaningful period (1 year) - how would you do it?

Good question, very complex answer. This would require a complex estimate.
From the expert estimates from what i read, it is estimated that we need around 30K-35K a year of new builds.

For one 1 year trends, there wouldn't be any great measure. But looking at the number of change of total add as supply, and number of transactions/mortgage approvals it could give some indication.

hometruths

Marius34 wrote: »

Good question, very complex answer. This would require a complex estimate.
From the expert estimates from what i read, it is estimated that we need around 30K-35K a year of new builds.

I think it is important to distinguish between the need for new supply of total housing stock and supply of property for sale both new and second hand. I am mostly interested in the supply for sale and how it effects market price discovery.

Marius34 wrote: »

For one 1 year trends, there wouldn't be any great measure. But looking at the number of change of total add as supply, and number of transactions/mortgage approvals it could give some indication.

Super. I'm glad we agree on something.

Marius34

schmittel wrote: »

Really? Apologies I must have misunderstood the following comment:

I said this, because if you take one year starting from 2019 Q3 - 2020 Q2, I guess you would come back saying that this presents mainly pre-covid times.
So to get some kind of indication to estimate only covid times you would need to wait until 2021 Q1

HotDudeLife

handlemaster wrote: »

We have all forgotten about brexit , the pound is down in value bad for exports and good for imports. It hasn't gone away. Time.delay on property here is become more evident

You are correct sir, but unfortunately there will still be people who will deny the facts. I see the property market lagging the economy more so then usual solely due to a boat load of desperate buyers who have approval at the moment but fear for their jobs jumping into the market. It's a bad approach long term and the logic is flawed but i can see where some of them are coming from.



When these buyers are gone and we see the covid payment withdrawn, we are in for a complete sh!t show that will likely be on par with 2008 or worse.


This is my opinion of course, i hope i am wrong as i have children and relatives, co workers that has seen covid impacted their career.

MacronvFrugals

Brexit/Covid and the fact we have signed up to reduce 50% of our carbon emissions by 2030, leaving aside the delusional Tories on bicycles this will be only be possible with big budget deficits.

Hubertj

schmittel wrote: »

I think it is important to distinguish between the need for new supply of total housing stock and supply of property for sale both new and second hand. I am mostly interested in the supply for sale and how it effects market price discovery.



Super. I'm glad we agree on something.

and we have to add in the mystical vacant units from the census

hometruths

Marius34 wrote: »

I said this, because if you take one year starting from 2019 Q3 - 2020 Q2, I guess you would come back saying that this presents mainly pre-covid times.
So to get some kind of indication to estimate only covid times you would need to wait until 2021 Q1

Or to put it another way: Marius wants to talk about what will happen over the next year

beauf

schmittel wrote: »

...New demand in that time period fell off a cliff as well. Look at the mortgage approval numbers....

Some of that was because banks were backlogged (remote working etc) and also where people had approval but one person ended up on a Covid payment, they were thrown back in a reassessment process which took ages . End result it was all back logged. One couple I'm aware of this took 6 months only just re-approved.

So its not demand in the traditional sense.

nerrad01

So when could we expect to see the life supports withdrawn? It is only when this happens that we see the real state of the economy. Covid is here for at least another year before we return to any semblance of normality, no way we can continue to prop up so many businesses that are no longer viable?

MacronvFrugals

nerrad01 wrote: »

So when could we expect to see the life supports withdrawn? It is only when this happens that we see the real state of the economy. Covid is here for at least another year before we return to any semblance of normality, no way we can continue to prop up so many businesses that are no longer viable?

The CB already stating this - Not in our interests to support loss-making businesses – Central Bank governor

https://www.irishtimes.com/business/economy/not-in-our-interests-to-support-loss-making-businesses-central-bank-governor-1.4356469

Marius34

schmittel wrote: »

Or to put it another way: Marius wants to talk about what will happen over the next year

Wrong!
Simply number of transaction over short time of lockdown, does not tell what is overall demands.

hometruths

beauf wrote: »

Some of that was because banks were backlogged (remote working etc) and also where people had approval but one person ended up on a Covid payment, they were thrown back in a reassessment process which took ages. End result it was all back logged. One couple I'm aware of this took 6 months only just re-approved.

So its not demand in the traditional sense.

Let me see if I understand this:

Traditional demand in 2019 - Buyer gets mortgage approval and then told to reapply because of change in financial circumstances for whatever reason

Net result one less buyer in the market, until they can get their mortgage approved again.

Non traditional demand in 2020 - Buyer gets mortgage approval and then told to reapply because of change in financial circumstance due to covid payment

Net result one less buyer in the market, until they can get their mortgage approved again.

There does not seem to be an awful lot of difference between demand in the traditional sense - i.e a buyer who is willing and able to purchase a property and this non traditional demand.

Neo-demand as it were

hometruths

schmittel wrote: »

You want to talk about what has happened over the last decade, and Marius wants to talk about what will happen over the next year, but my post that you’ve both taken exception to was about what happened in Q2 2020!

Marius34 wrote: »

no, that's not what I said, I explained in previous comment, that the numbers you provided is not suitable to compare with change in transactions for relatively short period.

Really? Apologies I must have misunderstood the following comment:

Marius34 wrote: »

Ok, I see you looking at total existing adds. Wouldn't think it's a good number to measure, in particular for relatively short term. It would make more sense to compare in at least 1 year from lockdown.

Marius34 wrote: »

I said this, because if you take one year starting from 2019 Q3 - 2020 Q2, I guess you would come back saying that this presents mainly pre-covid times.
So to get some kind of indication to estimate only covid times you would need to wait until 2021 Q1

schmittel wrote: »

Or to put it another way: Marius wants to talk about what will happen over the next year

Marius34 wrote: »

Wrong!
Simply number of transaction over short time of lockdown, does not tell what is overall demands.

Before I make a joke paraphrasing your "I guess there is some math mistakes", out of politeness I should double check:

Is English your first language?

Marius34

schmittel wrote: »

Really? Apologies I must have misunderstood the following comment:

Before I make a joke paraphrasing your "I guess there is some math mistakes", out of politeness I should double check:

Is English your first language?

No, it's not my first language.
I'm not sure what is not clear. I honestly will try to explain my best.

hometruths

Marius34 wrote: »

No, it's not my first language.
I'm not sure what is not clear. I honestly will try to explain my best.

No worries, that explains a lot of what we are disagreeing about

Marius34

schmittel wrote: »

No worries, that explains a lot of what we are disagreeing about

I do understand english, and what are you saying. When is not clear I'm adding a question mark.
You are right, my writing skills are not great, and sometimes is not clear what i'm saying, but you are welcome to question it, and I'll try to explain.

But you come up constantly with your interpretation that suits you.
In comments you speak about total/existing demands = number of transactions. I don't think you need to have fluent English, to disagree with it.

beauf

schmittel wrote: »

Let me see if I understand this:

Traditional demand in 2019 - Buyer gets mortgage approval and then told to reapply because of change in financial circumstances for whatever reason

Net result one less buyer in the market, until they can get their mortgage approved again.

Non traditional demand in 2020 - Buyer gets mortgage approval and then told to reapply because of change in financial circumstance due to covid payment

Net result one less buyer in the market, until they can get their mortgage approved again.

There does not seem to be an awful lot of difference between demand in the traditional sense - i.e a buyer who is willing and able to purchase a property and this non traditional demand.

Neo-demand as it were

There are two issues.

1) The process even for those who get approved is backlogged.

2) Those who have to go through another approval loop due to covid but ultimately still get approved. Also backlogged.

No transaction is not automatically "no or low demand" as your assuming. Its a backlog of demand. Its a bit like the latest iPhone, they run out of stock. Then claim there is no demand for them because the sales figure are zero.

I'm not saying demand isn't falling. I'm just saying the metrics you are using are unreliable. You are obviously free to spin it anyway you want.

beauf

Marius34 wrote: »

No, it's not my first language.
I'm not sure what is not clear. I honestly will try to explain my best.

Perfectly clear to me.

https://theconversation.com/the-seven-deadly-sins-of-statistical-misinterpretation-and-how-to-avoid-them-74306

beauf

nerrad01 wrote: »

So when could we expect to see the life supports withdrawn? It is only when this happens that we see the real state of the economy. Covid is here for at least another year before we return to any semblance of normality, no way we can continue to prop up so many businesses that are no longer viable?

That is the crux of the matter. When will we see the true state of the economy.

maybe we are being too pessimistic or optimistic.