Irish Property Market 2020 Part 2

cnocbui

WhenPigsCry wrote: »

Don't count on getting a vaccine before next summer. Even if it's as effective as they're saying - fingers crossed - frontline health staff have to get it as a priority, and there are some challenges distributing it (it has to be stored/transported in extremely cold temps.)

The rollout will be far faster than you think. Realistically, it at first only has to go to medical staff and then the vulnerable. It's not like we have to wait until 50% of the population have been vaccinated before we party. Transporting cold stuff is old-tech we have long since mastered and wont be a hinderance.

cnocbui

PropQueries wrote: »

Up. I believe they will overshoot their inflation targets, panic and interest rates will jump up to at least 5% in the next 5 years

No they won't.

no.8

Graham wrote:

The roaring 20s followed the Spanish Flu pandemic and with it a a decade of unprecedented growth and prosperity.

Pre-ceeded by one of the great wars in modern times....tbh, the only way was up

PropQueries

Graham wrote: »

The roaring 20s followed the Spanish Flu pandemic and with it a a decade of unprecedented growth and prosperity.

From a quick Google search and it makes sense:

"The main reasons for America's economic boom in the 1920s were technological progress which led to the mass production of goods, the electrification of America, new mass marketing techniques, the availability of cheap credit and increased employment which, in turn, created a huge amount of consumers."

We have nothing similar now except a lot more debt that must be paid back.

fliball123

PropQueries wrote: »

This just seems more and more like just before the last bust and all this talk of what people are going to do with their "savings" etc. is a bit premature in IMO:

"According to estimates based on the latest Department of Finance figures, the 1.13 million SSIA savers are likely to share a total payout of almost €15 billion when their accounts mature between May 2006 and May 2007."

Link to Irish Times article from 2005: https://www.irishtimes.com/news/ssia-scheme-may-cost-state-3-billion-as-savings-boosted-1.408294

Of course some have saved a bit, but an article on CIE last week said they have no reserves left if such an event ever happened again and they already have a €550 Million pension deficit to deal with.

That's just one example and next years hoped for party won't make up for all those businesses that lost a years profits this year. The Government's going to have to claw back all this expense at some stage and probably in the form of higher property taxes or other hidden taxes, charges etc.

As ye all know, I don't believe the demand for buying or renting a home was there at the start of this year and I would believe this will start to feed into and be shown in the housing (renting or buying) statistics before the end of this year.

The above list has nothing to do with the savings I have made over the last 9 months I was going to be doing them if corona was not here

AssetBacked2

Leozord wrote: »

well with the announcement of the vaccine today, will the rent prices skyrocket?

on the top of that, zoom shares are tumbling today (for those advocating on forever wfh), looks like Dublin rent will go up again in the near future

Jesus I hope not.

Objectively, it is a horrific rental market when the average price of a 1 bed in Dublin is 2k. Additionally, we will have to look at Mary Lou & Co in a few years leading us if the rental market makes any sort of recovery from this crash back to close to what it was in 2019.

PropQueries

cnocbui wrote: »

No they won't.

The ECB and Governments have literally no idea how their QE is working its way through the economy. That's why they can't understand why it hasn't been working.

It will show up eventually and all this extra QE will have added fuel to the inflation fire just when it wasn't needed. Then they will panic. Then they will raise interest rates fast IMO.

Cyrus

Cyrus wrote: »

grand and that 75% is where, nationwide, or just DLR ?

Propqueries, do you mind responding to this, i just want to make sure im absolutely clear.

you are suggesting that a house for sale currently at say 1.5m in dalkey or ballsbridge will be available at 375k is that correct?

PropQueries

Cyrus wrote: »

Propqueries, do you mind responding to this, i just want to make sure im absolutely clear.

you are suggesting that a house for sale currently at say 1.5m in dalkey or ballsbridge will be available at 375k is that correct?

Absolutely. Just type in houses for sale in Foxrock and you'll see many mansions in that one area just sitting there for well over a year. There's too many big houses in Dublin and not enough people working in jobs that could ever afford the prices they're looking for today.

Outside Dublin. You already know I believe the so-called vulture funds own most of the vacant ones and they will eventually want to exit over the next few years. So, house prices outside Dublin will most likely be worth a negative price by 2030 IMO.

Just to add. I assume you remember those articles the Irish Times used to do years ago (maybe they still do them) about what you can buy in Dublin and France? And I think Biden being elected may be bad for Ireland in relation to the OECD tax reforms. The democrats didn't win by a big margin so they will be looking to get those jobs back to the USA ASAP before the next election.

cnocbui

PropQueries wrote: »

The ECB and Governments have literally no idea how their QE is working its way through the economy. That's why they can't understand why it hasn't been working.

It will show up eventually and all this extra QE will have added fuel to the inflation fire just when it wasn't needed. Then they will panic. Then they will raise interest rates fast IMO.

All central banks know they have blown too much air into the balloon. Not one of them is going to be wielding a pin as a solution, they are going to try and let the air out in a controlled manner.

They have been a bunch of thick idiots all along. The problem has always been a lack of demand, not a lack of stuff to consume. They should never have been propping up corporations, they should have increased consumers disposable income through helicopter money or just paid a portion of their tax for them.

Since people's incomes haven’t changed, the CBs still have time on their side. There will likely be an almighty surge in consumption from those who still have jobs and have money saved (holidays - yay), but it probably wont last long until a return to penury normal.

woejus

PropQueries wrote: »

Absolutely. Just type in houses for sale in Foxrock and you'll see many mansions in that one area just sitting there for well over a year. There's too many big houses in Dublin and not enough people working in jobs that could ever afford the prices they're looking for today.

We've drifted into the arena of the unwell. I can't trust we're dealing with an honest broker here.

See the way the houses are "sitting there" - this means they are in no hurry to sell and can wait out dips in the market.

Hubertj

its a pity there is no vaccine for stupidity

PropQueries

woejus wrote: »

We've drifted into the arena of the unwell. I can't trust we're dealing with an honest broker here.

See the way the houses are "sitting there" - this means they are in no hurry to sell and can wait out dips in the market.

Entirely possible. It's just an opinion as they say

Timing belt

PropQueries wrote: »

The ECB and Governments have literally no idea how their QE is working its way through the economy. That's why they can't understand why it hasn't been working.

It will show up eventually and all this extra QE will have added fuel to the inflation fire just when it wasn't needed. Then they will panic. Then they will raise interest rates fast IMO.

QE started in 2015 in Europe and there has been no major inflation up to now (besides asset inflation) as the majority of the funds stayed in the financial institutions.

The difference this time is that the government are using the QE to stimulate the economy so yes we should see inflation and they will allow it to creep up to 3-4% before doing anything. When they do act to combat inflation it won’t be raising interest rates but will be QT so don’t see rates up at 5% in 5 years. We would be lucky if they get to 1%

PropQueries

Timing belt wrote: »

QE started in 2015 in Europe and there has been no major inflation up to now (besides asset inflation) as the majority of the funds stayed in the financial institutions.

The difference this time is that the government are using the QE to stimulate the economy so yes we should see inflation and they will allow it to creep up to 3-4% before doing anything. When they do act to combat inflation it won’t be raising interest rates but will be QT so don’t see rates up at 5% in 5 years. We would be lucky if they get to 1%

Entirely possible. However, I think the current decision makers in the ECB are 'book smart' and not 'street smart' and have little idea what they're doing or how their decisions affect investment decisions in the real world.

They appear to make decisions based on if they go wrong they can say "but that's what that economics book I read for my masters told me should happen", so they can't be held responsible.

IMO their decisions to date have put us right back into a similar place that resulted in the last bust.

Timing belt

PropQueries wrote: »

Entirely possible. However, I think the current decision makers in the ECB are 'book smart' and not 'street smart' and have little idea what they're doing or how their decisions affect investment decisions in the real world.

They appear to make decisions based on if they go wrong they can say "but that's what that economics book I read for my masters told me should happen", so they can't be held responsible.

IMO their decisions to date have put us right back into a similar place that resulted in the last bust.

What decisions have they undertaken to ‘put us in a similar place that resulted in the last bust’? I don’t think you know what you are talking about!!!

Cyrus

PropQueries wrote: »

Absolutely. Just type in houses for sale in Foxrock and you'll see many mansions in that one area just sitting there for well over a year. There's too many big houses in Dublin and not enough people working in jobs that could ever afford the prices they're looking for today.

Outside Dublin. You already know I believe the so-called vulture funds own most of the vacant ones and they will eventually want to exit over the next few years. So, house prices outside Dublin will most likely be worth a negative price by 2030 IMO.

Just to add. I assume you remember those articles the Irish Times used to do years ago (maybe they still do them) about what you can buy in Dublin and France? And I think Biden being elected may be bad for Ireland in relation to the OECD tax reforms. The democrats didn't win by a big margin so they will be looking to get those jobs back to the USA ASAP before the next election.

theres a few issues to address here,

first off, foxrock isnt, and hasnt been for some time, the darling of the socodu market any more. It has been over taken by areas on the coast (Blackrock to killiney) and by d4/d6. Hence a house in foxrock at over 1.3m can sometimes even look like value, for example this, decent sized house, reasonable kerb appeal, on torquay road, loads of room to extend and a 0.3 acre plot

https://www.myhome.ie/residential/brochure/dunbrody-torquay-road-foxrock-dublin-18-d18-v6f2/4461919

that in dartry or dalkey is at least 2m.

There is still an ok market for houses up to 1.3m or so, but once you get closer to 2m its slowed right down and houses at that price and above will be harder sells in foxrock as people dont desire to live there as much any more.

you are then suggesting non dublin houses will have no intrinsic value.

lets see how it plays out, im 100% certain you are nowhere in the ballpark.

fliball123

PropQueries wrote: »

The ECB and Governments have literally no idea how their QE is working its way through the economy. That's why they can't understand why it hasn't been working.

It will show up eventually and all this extra QE will have added fuel to the inflation fire just when it wasn't needed. Then they will panic. Then they will raise interest rates fast IMO.

So Governments and the ECB with all of their resources and money have no no idea how QE will turn out but you do hahahahahahahahahahahahahahahahahaqhahahahahahahahaha
God I need some air quick

PropQueries

Timing belt wrote: »

What decisions have they undertaken to ‘put us in a similar place that resulted in the last bust’? I don’t think you know what you are talking about!!!

Ask yourself why the ECB wants inflation to rise? Outside of a few countries, most of the countries in the eurozone (even post-covid) have manageable debt to GDP ratios. They need inflation to rise because they need interest rates to rise to meet the pensions timebomb that is getting ever closer by the year.

Once they reach their inflation target, they're increasing interest rates and fast IMO.

almostover

Currently looking to by my first home with my partner and finding that the property market is mental. We had set our sights on a modest detached house not too far from Cork city where we both work but that now has been ruled out as anything in our price range (€300k mortgage + €40k cash) requires a lot more that cosmetic overhaul in most cases. We have a combined salary of €105k per annum. Both of us want to be out of a mortgage in 25 years maximum and have limited our budget accordingly. No point having the so called house of your dreams if you have no disposable income to enjoy your life or be in constant fear or losing one's job and home.

We have more or less given up on the idea of a detached house in the countryside. There appears to be no value for money in the second-hand market. For example we viewed a 4 bed detached house 30mins from the city last week that was advertised for €285k and had a offer of €280k. When we viewed the property it was quite neglected, damage to the eaves and slates on the roof, cracks in the load bearing wall in the kitchen and damp around the chimney upstairs. All things fixable if the house was at the right price. But when redecoration and renovation of those items are costed the house was very poor value for money. Especially considering that the help to buy scheme gives €30k off a new A rated house. We have viewed perhaps 15 similar properties this year and have always come to the same conclusion. Therefore, have now switched tack to purchasing a semi-d in a new development.

We enquired on Thursday last week about a 4-bed semi D in a new development. 15 mins or so from the city. On the market 1 week. Only 3 properties left. Agent did not provide much in the way of details when questioned on garden sizes, aspects, technical data on build structure etc. Was sent a sexy marketing brochure and a price list and feck all else. Was told that agent would find out about other details for me but that they were getting huge demand to buy off plans. I called again at 9am this morning and in 1 day all remaining properties were sold. I am an engineer by profession and tend to ask for more detail but it's easier for the estate agents to snap up booking deposits from those less interested in the specification of what they are reserving for purchase. It's a complete frenzy out there, people forking over decent portions of their hard saved deposits based on a sales brochure. If you bought a new car from a brochure without even test driving it people would question you but one has to act fast in the property market despite the investment being about 10 times the price of a new car.

What's interesting on the new development is that the detached houses struggle to sell. The 'market' valuation dictates the asking price yet there seems to be very few customers in this market that can afford the prices of the larger detached homes.

No real point to this post other than ranting but our property market is dysfunctional. There are lots of people winning form it but it certainly isn't young working couples looking to buy their first home. The property market needs state intervention, I'm convinced of that now.

Cyrus

almostover wrote: »

Currently looking to by my first home with my partner and finding that the property market is mental. We had set our sights on a modest detached house not too far from Cork city where we both work but that now has been ruled out as anything in our price range (€300k mortgage + €40k cash) requires a lot more that cosmetic overhaul in most cases. We have a combined salary of €105k per annum. Both of us want to be out of a mortgage in 25 years maximum and have limited our budget accordingly. No point having the so called house of your dreams if you have no disposable income to enjoy your life or be in constant fear or losing one's job and home.

We have more or less given up on the idea of a detached house in the countryside. There appears to be no value for money in the second-hand market. For example we viewed a 4 bed detached house 30mins from the city last week that was advertised for €285k and had a offer of €280k. When we viewed the property it was quite neglected, damage to the eaves and slates on the roof, cracks in the load bearing wall in the kitchen and damp around the chimney upstairs. All things fixable if the house was at the right price. But when redecoration and renovation of those items are costed the house was very poor value for money. Especially considering that the help to buy scheme gives €30k off a new A rated house. We have viewed perhaps 15 similar properties this year and have always come to the same conclusion. Therefore, have now switched tack to purchasing a semi-d in a new development.

We enquired on Thursday last week about a 4-bed semi D in a new development. 15 mins or so from the city. On the market 1 week. Only 3 properties left. Agent did not provide much in the way of details when questioned on garden sizes, aspects, technical data on build structure etc. Was sent a sexy marketing brochure and a price list and feck all else. Was told that agent would find out about other details for me but that they were getting huge demand to buy off plans. I called again at 9am this morning and in 1 day all remaining properties were sold. I am an engineer by profession and tend to ask for more detail but it's easier for the estate agents to snap up booking deposits from those less interested in the specification of what they are reserving for purchase. It's a complete frenzy out there, people forking over decent portions of their hard saved deposits based on a sales brochure. If you bought a new car from a brochure without even test driving it people would question you but one has to act fast in the property market despite the investment being about 10 times the price of a new car.

What's interesting on the new development is that the detached houses struggle to sell. The 'market' valuation dictates the asking price yet there seems to be very few customers in this market that can afford the prices of the larger detached homes.

No real point to this post other than ranting but our property market is dysfunctional. There are lots of people winning form it but it certainly isn't young working couples looking to buy their first home. The property market needs state intervention, I'm convinced of that now.

just a tip for you (because its what everyone else is doing), if you are interested at all put down a booking deposit, its completely refundable and will give you at least 30 days to get answers to the qns you have.

Timing belt

PropQueries wrote: »

Ask yourself why the ECB wants inflation to rise? Outside of a few countries, most of the countries in the eurozone (even post-covid) have manageable debt to GDP ratios. They need inflation to rise because they need interest rates to rise to meet the pensions timebomb that is getting ever closer by the year.

Once they reach their inflation target, they're increasing interest rates and fast IMO.

They want inflation so that people will spend/invest. If there is. No inflation there is no incentive to spend/invest simple. Do you not understand basic economics and the effect of deflation?

Rates will be low for a long time to come even if we see inflation as they will undertake QT before raising rates.

They have already called out that a side effect of their QE will be upward pressure on house prices which will impact Germany Netherlands etc more than it will impact Ireland because of the income multiplier cap that we have in place.

almostover

Cyrus wrote: »

just a tip for you (because its what everyone else is doing), if you are interested at all put down a booking deposit, its completely refundable and will give you at least 30 days to get answers to the qns you have.

That probably my lesson to learn, just find it hard to fork over €5k or so just to declare my interest and get more information. Must get solicitor finalized so that I can pay the booking deposit quickly

fliball123

almostover wrote: »

That probably my lesson to learn, just find it hard to fork over €5k or so just to declare my interest and get more information. Must get solicitor finalized so that I can pay the booking deposit quickly

Well there is competition out there for most properties in good condition and in a desirable place to live so thats what your up against

PropQueries

Interesting betting odds on Paddy Power. The lowest odds are for the next general election being in 2021.

Is there something stirring I'm not aware of and how will this impact on the property market this year as if there's something stirring, will FF/FG change tack fast to bring in further policies to solve the housing issue this year?

WhenPigsCry

PropQueries wrote: »

Interesting betting odds on Paddy Power. The lowest odds are for the next general election being in 2021.

Is there something stirring I'm not aware of and how will this impact on the property market this year as if there's something stirring, will FF/FG change tack fast to bring in further policies to solve the housing issue this year?

Because there is a no confidence vote in Varadkar scheduled for this week, which if he lost, would in turn bring down the government. But he is unlikely to lose.

cnocbui

I've spent most of my life living in houses with cracked walls.

woejus

Timing belt wrote: »

Do you not understand basic economics and the effect of deflation?

There's a good few posters here who clearly don't grasp the fundamentals or subscribe to cargo cult economics, where every economic indicator can be twisted to suit their outlook.

Idbatterim

PropQueries wrote: »

Interesting betting odds on Paddy Power. The lowest odds are for the next general election being in 2021.

Is there something stirring I'm not aware of and how will this impact on the property market this year as if there's something stirring, will FF/FG change tack fast to bring in further policies to solve the housing issue this year?

in terms of housing delivery, there are so many issues, the main one being government wanting rip off prices. BUT there is such a labour shortage, that short of them encouraging housing which is essential and massively needed v hotel and office (which are no where near as important) (encourage via extra taxation etc, to disincentive office and hotel until we have far more housing) I dont get how you ramp up supply, short of thousands of workers coming into the country again...

brisan

AssetBacked2 wrote: »

Jesus I hope not.

Objectively, it is a horrific rental market when the average price of a 1 bed in Dublin is 2k. Additionally, we will have to look at Mary Lou & Co in a few years leading us if the rental market makes any sort of recovery from this crash back to close to what it was in 2019.

If FFG do not get their finger out and continue picking from the magical money tree that they said did not exist to build housing then Mary Lou will be in a great position come the next election
Either way another lockdown in late Jan is on the cards