Irish Property Market 2020 Part 2

antiskeptic

poker--addict wrote: »

Too many people in a house exponentially causes wear and tear. If you rent to 4 or 5 people i don't expect 8 to be living in it.

Fair enough. Then maybe split the difference. An extra 100 a month on the rent ought cover the occasional Beko oven replacement.

Cyrus

antiskeptic wrote: »

No idea on the breakdown. But put it this way; I'd be shocked and stunned if anyone suggested other than that, by a large, it is low wage migrant workers that form the bulk of incomers. Yeah, some returning Irish, yeah, some Google heads. But there are factories to be manned and fields to be harvested. That requires solid chunks of cheap labour. Big, solid chunks.

The only problem I have with your analysis is that it presumes the only way is up. That the vaccine will come, Covid will go ... and we'll all rock back to skinny lattes (served up by the aforementioned migrant workers).

I find that a bewildering and rather hopeful pov.

I mean, say retail doesn't quite roll back upright. Say all this online shopping means the high street takes a hit? Reasonable? What happens to the skinny latte economy of yours? What happens to the migrant workers upon whose influx your house price stability is based?

Just so we are clear all immigrants are min wage workers and everyone on pup would have been buying 800k houses that it ?

antiskeptic

Cyrus wrote: »

Just so we are clear all immigrants are min wage workers and everyone on pup would have been buying 800k houses that it ?

I'm open to the argument that the majority of incomers are other than low wage workers.

As for PUP. The breakdown seems to indicate the hospitality and retail sectors are worst hit. There'll be a cross section of wages there: the bulk low waged, less so middle waged and very much less so, highish waged (albeit few capable of financing an 800K house)

Your point?

My point was that the low wage inflow so relied upon would become an outflow at the drop of a hat.

And that if the economy doesn't right itself like a message in a bottle, the steady flow of punters, which my counterpart relies upon for stable prices, could dry up.

The PUP's don't have to be buying 800k houses. They do have to be buying houses of some description though. For my good friends argument to stack up.

PropQueries

A-rated three bed Semi detached house in lucan asking €345k. Sold in 2017 for €271k (ex vat) as per PPR.

Just goes to show they could sell 3 bed Semi detached A-rated houses in Dublin for c. €300k not that long ago.

Link to house on MyHome here: https://www.myhome.ie/residential/brochure/24-tullyhall-close-lucan-co-dublin/4467628

fliball123

antiskeptic wrote: »

No idea on the breakdown. But put it this way; I'd be shocked and stunned if anyone suggested other than that, by a large, it is low wage migrant workers that form the bulk of incomers. Yeah, some returning Irish, yeah, some Google heads. But there are factories to be manned and fields to be harvested. That requires solid chunks of cheap labour. Big, solid chunks.

The only problem I have with your analysis is that it presumes the only way is up. That the vaccine will come, Covid will go ... and we'll all rock back to skinny lattes (served up by the aforementioned migrant workers).

I find that a bewildering and rather hopeful pov.

I mean, say retail doesn't quite roll back upright. Say all this online shopping means the high street takes a hit? Reasonable? What happens to the skinny latte economy of yours? What happens to the migrant workers upon whose influx your house price stability is based?

Say there is a move to home working whereever there's broadband (the folk I sold to in Wicklow had been located in central Dublin and moved out solely because homeworking meant they could)

Rising prices in the sticks. Falling prices in the 'burbs'? Overall prices down (a house in the sticks is cheaper like for like).

I never said property was on the way up I said it had risen big difference. The reason to be hopeful is we are close to a cure you can read into pfizer or the russian vaccine yourself. You keep going on about people who lost there job and seem completely unable to understand that a lot of people didn't lose their job, the world did not go into shutdown as you stated. There are still more people working in Ireland than not working that is a fact and once the virus is gone there will be an uplift with people who have been forced into saving will be ready to spend (now they may not necessarily spend on property do).

What happens is the worker has to adapt get online/computer experience as some areas go more automated or online and jobs will decrease but you completely ignore areas like tourism, hospitality and hotels which will bounce back to where it was and further ignore areas like package/food deliveries, IT, Pharma, construction, healthcare that are all going to need a lot more people working in them. Its not up to you or me to tell people what way the wind is blowing but if they want work there will be plenty there for them if they adapt/retrain/reeducate.

The problem with your analysis is its nearly always your opinion anything I have put up I have tried put figures behind the statement but you come out with a commentary that would suggest that almost all the 69k workers who came in to live here in the last 2 years are all on low wages and you have not one shred of evidence to back it up. I cant prove you wrong but you cant prove your right

Timing belt

fliball123 wrote: »

I never said property was on the way up I said it had risen big difference. The reason to be hopeful is we are close to a cure you can read into pfizer or the russian vaccine yourself. You keep going on about people who lost there job and seem completely unable to understand that a lot of people didn't lose their job, the world did not go into shutdown as you stated. There are still more people working in Ireland than not working that is a fact and once the virus is gone there will be an uplift with people who have been forced into saving will be ready to spend (now they may not necessarily spend on property do).

What happens is the worker has to adapt get online/computer experience as some areas go more automated or online and jobs will decrease but you completely ignore areas like tourism, hospitality and hotels which will bounce back to where it was and further ignore areas like package/food deliveries, IT, Pharma, construction, healthcare that are all going to need a lot more people working in them. Its not up to you or me to tell people what way the wind is blowing but if they want work there will be plenty there for them if they adapt/retrain/reeducate.

The problem with your analysis is its nearly always your opinion anything I have put up I have tried put figures behind the statement but you come out with a commentary that would suggest that almost all the 69k workers who came in to live here in the last 2 years are all on low wages and you have not one shred of evidence to back it up. I cant prove you wrong but you cant prove your right

A lot of business will not bounce back and even if covid was gone in the morning there are sectors of the economy that have been seriously damaged. The notion that its like flipping a switch and things go back to pre covid or better is a naive assumption as a lot of companies have taken on big debt to get through this and unless there is a massive recovery (something Europe have been trying to do for over 10 years and keep failing at it) this will pull those companies down and result in their employees being unemployed.

Donald Trump

PropQueries wrote: »

A-rated three bed Semi detached house in lucan asking €345k. Sold in 2017 for €271k (ex vat) as per PPR.

Just goes to show they could sell 3 bed Semi detached A-rated houses in Dublin for c. €300k not that long ago.

Link to house on MyHome here: https://www.myhome.ie/residential/brochure/24-tullyhall-close-lucan-co-dublin/4467628

So not much of a difference then if VAT is included in the price for it new?

Probably would have spent a few quid on it moving in as well

Hubertj

antiskeptic wrote: »

I wonder what proportion of the difference is the result of buyers holding off and what proportion of the difference is the the result of buyers being told to feck off by their bank, their circumstances having being altered by Covid.

Presumably if their circumstances stay altered they won't be buying anytime soon.

What was it, 350k people on PUP (out of a workforce of 2.2 mil (2.4 mil total - 200k unemployed). Nearly 1/6 of the workforce).

I wonder would banks be taking a dimmer view on employment types more vulnerable to recession. Like, if I was planning on lending money I'd be taking that view. The dizzy prospect of 3% on free money notwithstanding.

And how many were unable to purchase because their new build wasn’t finished?

Graham

Mod Note

some off-topic posts deleted. Curious2know, welcome. I invite you to read the thread title and forum charter before you continue posting.

Please do not reply to this post.

combat14

will more taxes to pay states 252 billion debt (only 40 billion 12 years ago) curb demand for over priced houses


Government will need to look at ways to find extra money in wake of Covid crisis, says McGrath

https://www.irishtimes.com/news/ireland/irish-news/government-will-need-to-look-at-ways-to-find-extra-money-in-wake-of-covid-crisis-says-mcgrath-1.4408849?mode=amp

PommieBast

Timing belt wrote: »

A lot of business will not bounce back and even if covid was gone in the morning there are sectors of the economy that have been seriously damaged. The notion that its like flipping a switch and things go back to pre covid or better is a naive assumption as a lot of companies have taken on big debt to get through this and unless there is a massive recovery (something Europe have been trying to do for over 10 years and keep failing at it) this will pull those companies down and result in their employees being unemployed.

A major issue is who will end up picking up the tab for what looks like is going to be at least a year of unpaid rents. Institutional landlords going bust is not something that can happen in isolation and everyone else in the economy ending up fine. As for small-fry landlords who their property is their pension...

PropQueries

combat14 wrote: »

will more taxes to pay states 252 billion debt (only 40 billion 12 years ago) curb demand for over priced houses


Government will need to look at ways to find extra money in wake of Covid crisis, says McGrath

https://www.irishtimes.com/news/ireland/irish-news/government-will-need-to-look-at-ways-to-find-extra-money-in-wake-of-covid-crisis-says-mcgrath-1.4408849?mode=amp

Looks like they’re going to use Covid as an excuse to raise taxes to meet the cost of HAP and all those long term lease agreements (up to €3,000 a month for apartments over 25 years) they’ve being signing up to with the pension/investment funds over the past couple of years.

I’m still at a loss over the Covid expenses. Most of the PUP payments are being covered by the surplus in the PRSI fund and many non urgent appointments, operations etc. in hospitals have been cancelled.

Throw in the raiding of the rainy day fund and it seems that the state is borrowing money primarily to maintain existing salaries and pensions to the civil and public sector workers.

Much like after the last bust.

combat14

PropQueries wrote: »

Looks like they’re going to use Covid as an excuse to raise taxes to meet the cost of HAP and all those long term lease agreements (up to €3,000 a month for apartments over 25 years) they’ve being signing up to with the pension/investment funds over the past couple of years.

I’m still at a loss over the Covid expenses. Most of the PUP payments are being covered by the surplus in the PRSI fund and many non urgent appointments, operations etc. in hospitals have been cancelled.

Throw in the raiding of the rainy day fund and it seems that the state is borrowing money primarily to maintain existing salaries and pensions to the civil and public sector workers.

Much like after the last bust.

so basically the country is living way above its means and a radical overhaul of taxes and govt expenditure is required with all the corresponding knock on effects to the economy and ultimately the property market too

PropQueries

combat14 wrote: »

so basically the country is living way above its means and a radical overhaul of taxes and govt expenditure is required with all the corresponding knock on effects to the economy and ultimately the property market too

That’s been my fear. There’s nothing left to tax that would make any meaningful impact on the governments finances except my home and my pension.

They’ve proven time and again that they won’t touch civil and public sector wages or pensions.

In fact just over a month ago they signed up to a new hospital consultants contract that will make them among the highest paid public consultants on the planet and at a time when they were telling the rest of us that the state must manage its expenses for the benefit of “all” taxpayers.

“The new €250,000 public-only role would involve one of the highest-paid consultant contracts in the OECD, unmatched outside the richest and most developed countries.”

Link here: https://m.independent.ie/irish-news/health/new-public-only-hospital-contract-on-the-way-39572135.html

PropQueries

[Deleted User] wrote: »

This is laughable. Seriously, have a little think back to the last recession.

Apologies if you have learning difficulties or suffered a recent brain injury. In which case you get a pass.

Asking existing civil and public sector workers to pay a little into a pension where the payout is a multiple of the contributions is not a pay cut. Also throwing the post 2011 civil and public sector workers under the proverbial bus so the pre-2011 workers can maintain their existing pay and pensions was hardly a sacrifice on their part.

And all paid for by adding c.€200 billion to the national debt that must be paid back by all workers who primarily are on significantly less pay and most who will never receive any pension.

Graham

Mod Note

please continue the discussion of civil service/public sector salaries in the relevant forum.

cnocbui

combat14 wrote: »

will more taxes to pay states 252 billion debt (only 40 billion 12 years ago) curb demand for over priced houses


Government will need to look at ways to find extra money in wake of Covid crisis, says McGrath

https://www.irishtimes.com/news/ireland/irish-news/government-will-need-to-look-at-ways-to-find-extra-money-in-wake-of-covid-crisis-says-mcgrath-1.4408849?mode=amp

I know, they could pay even higher subsidies to people so even more of them can go out and buy more EVs. More subsidies for solar panels that generate electricity at the time of day and year when it's least needed. Pay people a subsidy to plant more trees, as money grows on them and we could harvest that. I hope they don't increase corporate tax to 18% and apply that to REITS, that would be just stupid.

Pelezico

There are guys out there who have milked the money over the last year. Then there are others who struggle well into their thirties for a measly deposit.

Life is cruel.

PropQueries

cnocbui wrote: »

I know, they could pay even higher subsidies to people so even more of them can go out and buy more EVs. More subsidies for solar panels that generate electricity at the time of day and year when it's least needed. Pay people a subsidy to plant more trees, as money grows on them and we could harvest that. I hope they don't increase corporate tax to 18% and apply that to REITS, that would be just stupid.

It’s a tough one for governments. Given the global economy, it’s hard to tax company profits or wages much more as both of these can move out very quickly.

Just this week “Greece Offers Tax Breaks to Lure the Work-From-Anywhere Crowd”.

Link to Bloomberg here: https://www.bloomberg.com/news/articles/2020-11-11/greece-seeks-to-lure-workers-from-abroad-with-new-tax-incentives

The only thing left to tax in most countries and Ireland in particular is the one asset that can’t be physically moved out of the country i.e. property and land.

And all this is happening when the OECD global tax reforms will most likely be agreed next year where it appears their looking at introducing rules that will make basing operations in low tax countries like Ireland to be not as beneficial as it has been over the past 30 years.

So, given that the ever increasing increases in carbon taxes are already built into the government finances for the next ten years, the only thing left is much much higher local property taxes. This tax will surely begin to impact property values substantially in my opinion over the next few years.

Dwarf.Shortage

Question, a friend has received planning permission to build a house in rural Ireland and has decided not to build it he is going to buy in Dublin instead. I assume he is still an FTB if he applies for a mortgage to buy in Dublin? the grant of planning permission doesn't constitute actually having a house does it?

Hubertj

PropQueries wrote: »

It’s a tough one for governments. Given the global economy, it’s hard to tax company profits or wages much more as both of these can move out very quickly.

Just this week “Greece Offers Tax Breaks to Lure the Work-From-Anywhere Crowd”.

Link to Bloomberg here: https://www.bloomberg.com/news/articles/2020-11-11/greece-seeks-to-lure-workers-from-abroad-with-new-tax-incentives

The only thing left to tax in most countries and Ireland in particular is the one asset that can’t be physically moved out of the country i.e. property and land.

And all this is happening when the OECD global tax reforms will most likely be agreed next year where it appears their looking at introducing rules that will make basing operations in low tax countries like Ireland to be not as beneficial as it has been over the past 30 years.

So, given that the ever increasing increases in carbon taxes are already built into the government finances for the next ten years, the only thing left is much much higher local property taxes. This tax will surely begin to impact property values substantially in my opinion over the next few years.

Only an idiot would think property tax won’t increase over the coming years. It’s been on the cards for 2-3 years now. It should increase, it’s too low.

Hubertj

https://www.google.ie/amp/s/www.irishtimes.com/business/technology/bt-sets-up-irish-procurement-business-with-14-5bn-budget-1.4407704%3fmode=amp

Positive for Ireland. Highly skilled jobs with people relocating here as well as more employment opportunities. Eaton, Verizon and others have done similar over last few years. Procurement CoEs are very positive for the economy. Nice to have some positive news amid this sh*t show.

PropQueries

Hubertj wrote: »

Only an idiot would think property tax won’t increase over the coming years. It’s been on the cards for 2-3 years now. It should increase, it’s too low.

I suppose it’s down to what you or the state thinks is too low. Is 1% too low or too high? 1% on a €400k house is €4,000 per year.

If such a percentage seems insane, just look across the pond (westwards).

The median annual property tax payment in Massachusetts is $4,309.

New Jersey’s effective rate on owner-occupied property is c. 2%. That would be €8,000 per year on a €400,000 property.

Hubertj

PropQueries wrote: »

I suppose it’s down to what you or the state thinks is too low. Is 1% too low or too high? 1% on a €400k house is €4,000 per year.

If such a percentage seems insane, just look across the pond (westwards).

The median annual property tax payment in Massachusetts is $4,309.

New Jersey’s effective rate on owner-occupied property is c. 2%. That would be €8,000 per year on a €400,000 property.

I’m well aware of US property taxes. My brother lives in Boston and I considered relocating to New Jersey. Taxes too expensive especially when compared to places like Texas.

I can see increases being phased in over a number of years.

PropQueries

Hubertj wrote: »

I’m well aware of US property taxes. My brother lives in Boston and I considered relocating to New Jersey. Taxes too expensive especially when compared to places like Texas.

I can see increases being phased in over a number of years.

But on a brighter note, a house valued today at c. €400k will most likely have a value of c. €100k in 5 years so a 2% property tax would only amount to c. €2k per year instead of c. €8k per year.

Hubertj

PropQueries wrote: »

But on a brighter note, a house valued today at c. €400k will most likely have a value of c. €100k in 5 years so a 2% property tax would only amount to c. €2k per year instead of c. €8k per year.

That’s a really stupid statement to make. Up there with the rest of them. I know you’re just trying to wing people up but it’s tiring after a few months. Sad sad life.

Timing belt

PropQueries wrote: »

But on a brighter note, a house valued today at c. €400k will most likely have a value of c. €100k in 5 years so a 2% property tax would only amount to c. €2k per year instead of c. €8k per year.

So you have moved from a 50% drop in house prices in 5 years to a 75% drop....you will need a new conspiracy theory to justify the extra decrease :-)

Timing belt

PommieBast wrote: »

A major issue is who will end up picking up the tab for what looks like is going to be at least a year of unpaid rents. Institutional landlords going bust is not something that can happen in isolation and everyone else in the economy ending up fine. As for small-fry landlords who their property is their pension...

The landlords will need to pick up the tab as it is the cost of doing business.

If there was no risk then there should be no reward.

You could argue who is going to pick up the tab for all the business that were forced to close. Yes there will be help in the form of loans or grants but the costs still sit with them so why should landlords be any different.

PropQueries

Hubertj wrote: »

That’s a really stupid statement to make. Up there with the rest of them. I know you’re just trying to wing people up but it’s tiring after a few months. Sad sad life.

Not really. Many properties in Dublin City that could have been bought for around the €100k mark in 2011 would be asking €300k to €400k today.

cnocbui

PropQueries wrote: »

Not really. Many properties in Dublin City that could have been bought for around the €100k mark in 2011 would be asking €300k to €400k today.

I can't imagine how absolutely awful such a property must have been when €100 K is what my ex paid in 2011 for an old small two bedroom terrace in Limerick, and that was 15% below asking and a bit of a bargain.

Post a pic of one of these Dublin 100K properties, as I am slightly skeptical.