Irish Property Market 2020 Part 3

Marius34

Timing belt wrote: »

OK Lets look at the Maths for Dublin

Assumptions
1) If we assume that a normal vacancy rate is 6% (you previously said this was healthy)
2) all Data is source from the CSO
3) I have assumed there was no shortage of stock prior to 2016 (we know this was not the case as Rents were rising 10% at the time but I have assumed this to avoid areas of dispute)
4) I have estimated obsolesce at 0.25% of the housing stock (This is half of what the central bank estimate but I want to be conservative for this example to avoid areas of dispute)
5) Any Vacant properties over the 6% level re-enter the housing market



As you can see there is still a shortage in the Dublin during this period even if the vacant properties re-enter the market and there was no shortage prior to 2016.

With regards institutions purchasing property this has happened and it is estimated that 50% of all sales of apartments have been by institutions which adds to a shortage of supply for regular buyers.

That then begs the question who are the institutions renting to?
- The majority will be would be FTB's that are locked out of housing market because of affordability and supply.
- The Government have also been very active in renting from the institutions to address the homeless crisis.

A consequence of this is that rents have a floor provided by the government which means that rent does not drop even if there is a oversupply as the government are propping up the high rent which in turn attracts more institutions to invest in the Dublin rental market making the supply problem worse.

In short the housing market is a mess due to government intervention to try and address the housing crisis and the unforeseen impact of their short term solutions. I can understand why the Government stepped in with the homeless crisis but they ended up making the situation worse and if the new properties that they bring to market are purchased by institutions them we are in a vicious cycle.

Interesting analysis. Although Census has to many unknown factors, thus it impossible to get true picture.
Household size is 2.75, so you can use this number. This is normally used for Migration change. For natural increase ratio of new home requirements could be between 2 to 2.5. But 2.75 would still relatively fair assumption for short term.
Healthy vacancy rate of 6% (if it include temporal vacancy) might be valid nationally, but I don't think this can be applied to Dublin City Center, as it's more international/dynamic. Many properties could be used as secondary home for weekdays only, like international worker, students from outside Dublin, thus the proportion of properties temporally vacant could be much higher, than in other parts of the country.
Overall nice analysis, backed by numbers

Timing belt

Marius34 wrote: »

Interesting analysis. Although Census has to many unknown factors, thus it impossible to get true picture.
Household size is 2.75, so you can use this number. This is normally used for Migration change. For natural increase ratio of new home requirements could be between 2 to 2.5. But 2.75 would still relatively fair assumption for short term.
Healthy vacancy rate of 6% (if it include temporal vacancy) might be valid nationally, but I don't think this can be applied to Dublin City Center, as it's more international/dynamic. Many properties could be used as secondary home for weekdays only, like international worker, students from outside Dublin, thus the proportion of properties temporally vacant could be much higher, than in other parts of the country.
Overall nice analysis, backed by numbers

The 6% would not cover a situation where a property was vacant only at weekends. The 6% is what the Central bank use for vacancies in their analysis.

PropQueries

Timing belt wrote: »

The 6% would not cover a situation where a property was vacant only at weekends. The 6% is what the Central bank use for vacancies in their analysis.

And, if I'm reading how they counted vacant properties correctly, those AirBnB properties in Dublin City would have been counted as holiday homes so they were also not included in their vacancy figures.

So, that actually adds significantly to the number of vacant properties since they have been all but banned at this stage. Unless there's an obvious loophole there that i'm not aware of.

Cyrus

PropQueries wrote: »

But 4% is still 4 times the risk free rate of return on deposit. That's a significant excess return for what is minimal risk and more than compensates for any of the risks or costs etc. you outline. Yes, there is a very very slim chance of getting a bad tenant who won't pay the rent, but that risk is minimal and is more than covered by receiving 4 times the return on deposit.

Most rental properties won't require that much maintenance if done properly to begin with and if the landlord treats the tenants reasonably, they will also treat the landlord in a reasonable way in the vast majority of instances.

I find it amazing that landlords and the state seem to believe that the rental yields on property should remain the same as if deposit rates were still 4%-5%.

For cash buyers and investors with no buy to let loan, rental yields should be no more than 2% in a properly functioning rental market (i.e. rents should be half the current level in today's market) if people truly believe current interest rates are going to remain this low for a considerable amount of time.

When rental yields are in excess of 2% in today's market, it means investors are either expecting a significant drop in property prices in the near future or we have a very very dysfunctional rental market. It's obviously the latter, but I believe the former is very likely also.

Are you actually serious ? You’ve obviously never had to rent a property , to me 5 percent isn’t enough, also what if you are funding 80 percent of it at 2.5-3 percent , is 5 percent still too much ?

PropQueries

Cyrus wrote: »

Are you actually serious ? You’ve obviously never had to rent a property , to me 5 percent isn’t enough, also what if you are funding 80 percent of it at 2.5-3 percent , is 5 percent still too much ?

Ok, you inherit €300,000.

You can either put it on deposit for the next 5 years and receive zero or buy that investment property at a 4% rental yield (it's higher in most parts of Dublin), and receive €12,000 per year or €60,000 every 5 years.

At 2%, you would still receive €30,000 every 5 years, which is more than the zero you would receive on deposit.

Maybe some people are wealthy enough to happily forego €30,000 every 5 years at a 2% yield, but I think most people would/should be very happy with that return, especially given that there are very few alternative relatively risk free investments.

Unless, of course, you believe, as I do, that property values will fall significantly in the very near future, in which case, placing that inheritance on deposit would be the best bet and which I would recommend.

You're cost of funding point is absolute mute in today's economy given that very few investment properties are purchased with buy-to-let loans these days and I don't see why renters today should pay more for what basically amounts to an ever continuing back-door bailout of the investors who gambled on ever increasing property prices during the Celtic Tiger years IMO

Cyrus

PropQueries wrote: »

Ok, you inherit €300,000.

You can either put it on deposit for the next 5 years and receive zero or buy that investment property at a 4% rental yield (it's higher in most parts of Dublin), and receive €12,000 per year or €60,000 every 5 years.

At 2%, you would still receive €30,000 every 5 years, which is more than the zero you would receive on deposit.

Maybe some people are wealthy enough to happily forego €30,000 every 5 years at a 2% yield, but I think most people would/should be very happy with that return, especially given that there are very few alternative relatively risk free investments.

Unless, of course, you believe, as I do, that property values will fall significantly in the very near future, in which case, placing that inheritance on deposit would be the best bet and which I would recommend.

You're cost of funding point is absolute mute in today's economy given that very few investment properties are purchased with buy-to-let loans these days and I don't see why renters today should pay more for what basically amounts to an ever continuing back-door bailout of the investors who gambled on ever increasing property prices during the Celtic Tiger years IMO

It’s not risk free though, if it was everyone would do it .

Timing belt

PropQueries wrote: »

And, if I'm reading how they counted vacant properties correctly, those AirBnB properties in Dublin City would have been counted as holiday homes so they were also not included in their vacancy figures.

So, that actually adds significantly to the number of vacant properties since they have been all but banned at this stage. Unless there's an obvious loophole there that i'm not aware of.

Holiday homes are included in the vacancy rate I have used.

PropQueries

Cyrus wrote: »

It’s not risk free though, if it was everyone would do it .

Well, if you believe deposit rates will remain at today's level for the next 10 years and that house prices will be worth the same in 10 years time as today (i.e. no increase in the next 10 years), then 2% is a fantastic, amazing relatively risk-free rate of return.

fergus1001

anyone expecting a big upheaval from no deal brexit ?

BryanMartin21

Bass Reeves wrote: »

I do not know the value of houses in Inchicore but assuming a two week vacancy period every 12 months between rentals the return is 5% return on a 300k house. That a very minimum that any investor would require as a return on a rental.

In general in lower rental value areas you need a higher return as you run a great risk as well as having the same maintenance charge rates. A plumber or painter will not charge less per hour just because you get 1300/month compare to 2k/ month. He may even charge less at a higher rental value as he may need no one to sit in the van while he is carrying out a repair

A benchmark more appropriate would be the salaries those renting typically earn, not just what investors should look to earn. One man's home is another's investment. Covering the cost of an investment property from rent alone is phenomenal, it is in effect free money.

hometruths

Timing belt wrote: »

OK Lets look at the Maths for Dublin

Assumptions
1) If we assume that a normal vacancy rate is 6% (you previously said this was healthy)
2) all Data is source from the CSO
3) I have assumed there was no shortage of stock prior to 2016 (we know this was not the case as Rents were rising 10% at the time but I have assumed this to avoid areas of dispute)
4) I have estimated obsolesce at 0.25% of the housing stock (This is half of what the central bank estimate but I want to be conservative for this example to avoid areas of dispute)
5) Any Vacant properties over the 6% level re-enter the housing market



As you can see there is still a shortage in the Dublin during this period even if the vacant properties re-enter the market and there was no shortage prior to 2016.

With regards institutions purchasing property this has happened and it is estimated that 50% of all sales of apartments have been by institutions which adds to a shortage of supply for regular buyers.

That then begs the question who are the institutions renting to?
- The majority will be would be FTB's that are locked out of housing market because of affordability and supply.
- The Government have also been very active in renting from the institutions to address the homeless crisis.

A consequence of this is that rents have a floor provided by the government which means that rent does not drop even if there is a oversupply as the government are propping up the high rent which in turn attracts more institutions to invest in the Dublin rental market making the supply problem worse.

In short the housing market is a mess due to government intervention to try and address the housing crisis and the unforeseen impact of their short term solutions. I can understand why the Government stepped in with the homeless crisis but they ended up making the situation worse and if the new properties that they bring to market are purchased by institutions them we are in a vicious cycle.

Thanks, and again fair play to you for time and effort in actually looking at the data and considering it intelligently. Much more helpful than just accusing posters of making stuff up.

Assuming your figures are correct, (and I believe they are), then it suggests the current deficit we actually have in Dublin represents a housing need for 4419 people (13,259/3) or 0.3% of the population which seems manageable.

It certainly seems a lot more manageable than 17,745 on the waiting list for a house in Dublin as well as 10,317 looking for a transfer. (January 2019)

Bass Reeves

BryanMartin21 wrote: »

A benchmark more appropriate would be the salaries those renting typically earn, not just what investors should look to earn. One man's home is another's investment. Covering the cost of an investment property from rent alone is phenomenal, it is in effect free money.

You can benchmark off anything you like. A 5% return will not cover anywhere near what an investor needs.
You assume that the house has no maintenance costs. In lower rental value areas of Dublin that he risk of damage and non payment is higher.

Assuming a 5% return on a 300k house where 20% deposit is required for an investor that 60k. Allowing for stamp duty, solicitor and transfer fees mean another 10k for investor to find. 240k loan at 4% requires 1400/month repayments. Only 80% of interest is allowable against tax so investor will need to top up to the tune of 500+/month when tax, vacancy and maintenance is allowed for. Risk of damage and non-payment is on top of that that.

Few rentals will appreciate in value compared to a private house.

Timing belt

schmittel wrote: »

Thanks, and again fair play to you for time and effort in actually looking at the data and considering it intelligently. Much more helpful than just accusing posters of making stuff up.

Assuming your figures are correct, (and I believe they are), then it suggests the current deficit we actually have in Dublin represents a housing need for 4419 people (13,259/3) or 0.3% of the population which seems manageable.

It certainly seems a lot more manageable than 17,745 on the waiting list for a house in Dublin as well as 10,317 looking for a transfer. (January 2019)

Remember that I assumed no shortage carried forward despite at the time rents risings by 10% due to a shortage and have been extremely conservative with my analysis.
I.e.
If I used the central bank figure for obsolete stock it would add 10k.
If I used the 2.75 people per unit it would increase by add 2.5k.

Vacants are an important part to the supply issue but there is still a need for new builds. But just building and letting institutions sweep up the new properties will not resolve the crisis.

Timing belt

Bass Reeves wrote: »

You can benchmark off anything you like. A 5% return will not cover anywhere near what an investor needs.
You assume that the house has no maintenance costs. In lower rental value areas of Dublin that he risk of damage and non payment is higher.

Assuming a 5% return on a 300k house where 20% deposit is required for an investor that 60k. Allowing for stamp duty, solicitor and transfer fees mean another 10k for investor to find. 240k loan at 4% requires 1400/month repayments. Only 80% of interest is allowable against tax so investor will need to top up to the tune of 500+/month when tax, vacancy and maintenance is allowed for. Risk of damage and non-payment is on top of that that.

Few rentals will appreciate in value compared to a private house.

A rental property will appreciate the same as a private property it’s just there are more costs involved for a single investor. Due to government intervention it is much more profitable to access the housing market via a investment fund as they can structure it to pay less tax and have the market share to keep rents high.

PropQueries

Timing belt wrote: »

A rental property will appreciate the same as a private property it’s just there are more costs involved for a single investor. Due to government intervention it is much more profitable to access the housing market via a investment fund as they can structure it to pay less tax and have the market share to keep rents high.

But can a small investor borrow to invest in a REIT etc.?

The primary argument put forward to justify high rental yields in today's market are the debt servicing costs. I think the data shows that very few residential investment properties purchased over the past 8 years were purchased with buy-to-let loans.

It seems to me that the arguments put forward today for the high rental yields are down to investors arguing that today's renters should meet the full cost of their bust investment decisions from over 10 years ago.

hometruths

Timing belt wrote: »

Remember that I assumed no shortage carried forward despite at the time rents risings by 10% due to a shortage and have been extremely conservative with my analysis.
I.e.
If I used the central bank figure for obsolete stock it would add 10k.
If I used the 2.75 people per unit it would increase by add 2.5k.

Vacants are an important part to the supply issue but there is still a need for new builds. But just building and letting institutions sweep up the new properties will not resolve the crisis.

I totally accept you have demonstrated a need for new builds in Dublin but I also think you were correct in your conservatism.

I think you were correct to assume no shortage carried forward. Rents rising at 10% tell us there was a shortage of supply on market. Vacancy rate of 6.87% tells us that there was not a physical shortage of built units. i.e supply to market was constrained at that time for some reason.

I am assuming the central bank figure for obsoletes is a national one thus it follows that Dublin would be significantly lower. We've had enough discussions about the effects of market demand in Leitrim vs Dublin to know that properties in Dublin will be better maintained than elsewhere.

I would love to see someone in Dept of Housing do the kind of analysis you did at the electoral district level. Clearly Pembroke and Rathmines etc have plenty of stock and if wealth people want to hoard properties in these areas so be it.

But there are areas of Dublin with much lower vacancy rates that are disproportionately likely to attract the population growth and domestic demographic demand.

Localised analysis of these areas would give the public much greater confidence that they had a handle on the situation than simply wailing "Panic, we need to build 50k a year for the next 10 years".

it would also from govt's point of view breakdown the targets to more manageable levels and they could prioritise them - introducing tax/finance incentives for certain areas to achieve this.

Instead it seems like most new building is driven by developer's pockets - they can make more by delivering upscale units in pricier parts of town so that's what they do.

Timing belt

PropQueries wrote: »

But can a small investor borrow to invest in a REIT etc.?

The primary argument put forward to justify high rental yields in today's market are the debt servicing costs. I think the data shows that very few residential investment properties purchased over the past 8 years were purchased with buy-to-let loans.

It seems to me that the arguments put forward today for the high rental yields are down to investors arguing that today's renters should meet the full cost of their bust investment decisions from over 10 years ago.

Small investors are locked out of the Buy to Let market unless the have the investment outright as Banks are reluctant to lend to due to the capital cost of such a loan and hence the high LTV limits and rates.

I am not talking about investing in REIT's directly but instead investing in an investment fund that will use investors money to enable them to borrow from a bank and invest in property. The investment funds will get easy access to debt by also investing a small portion in other assets (Gov Bonds, Stock Market) as the banks credit dept will look at the investment fund and take the decision that they are diversified and therefore deem that there is less risk involved.

QE has put pressure on banks to lend and unlike the mortgage market there are no central bank limits so there has been massive growth in lending to Funds.

Margins will be lower that mortgages and the cost to the bank will be higher as more capital will be required to back the loans but saying this if it is a fund with some element of diversification it will be about half of a capital cost of a Property company borrowing directly from the bank.

When you take into account the structure of the funds (or the fund of funds invested in) and the jurisdiction that they are set up in you are able to play the system to ensure that you pay minimal tax. There is a reason that Ireland, Lux and UK territories (Cayman, Jersey, Guernsey) are preferred locations for the fund industry.

The funds are not interested in previous investment decisions or losses like you suggest and have only one agenda which is to maximise returns for their investors to justify their large fees and charges.

PropQueries

schmittel wrote: »

I totally accept you have demonstrated a need for new builds in Dublin but I also think you were correct in your conservatism.

I think you were correct to assume no shortage carried forward. Rents rising at 10% tell us there was a shortage of supply on market. Vacancy rate of 6.87% tells us that there was not a physical shortage of built units. i.e supply to market was constrained at that time for some reason.

I am assuming the central bank figure for obsoletes is a national one thus it follows that Dublin would be significantly lower. We've had enough discussions about the effects of market demand in Leitrim vs Dublin to know that properties in Dublin will be better maintained than elsewhere.

I would love to see someone in Dept of Housing do the kind of analysis you did at the electoral district level. Clearly Pembroke and Rathmines etc have plenty of stock and if wealth people want to hoard properties in these areas so be it.

But there are areas of Dublin with much lower vacancy rates that are disproportionately likely to attract the population growth and domestic demographic demand.

Localised analysis of these areas would give the public much greater confidence that they had a handle on the situation than simply wailing "Panic, we need to build 50k a year for the next 10 years".

it would also from govt's point of view breakdown the targets to more manageable levels and they could prioritise them - introducing tax/finance incentives for certain areas to achieve this.

Instead it seems like most new building is driven by developer's pockets - they can make more by delivering upscale units in pricier parts of town so that's what they do.

Have to admit too, his analysis was very impressive.

But in relation to the upscale properties built over the past few years, from Greystones all the way into Ballsbridge, it looks like the demand was never really there with many (most?) lying empty.

It also seems to be a worldwide phenomenon, so may be interesting how this plays out. If interest rates did rise, the investors in these projects would be demanding their investment back fairly quickly. At the moment, it looks like they are all playing the extend and pretend game as where else can they park their money?

I also wonder who actually came up with these type of investments as if there was little demand for such units during the 2000's, how could there have been demand for them in 2010s?

There will be a lot of angry investors in the near future IMO

Timing belt

schmittel wrote: »

I totally accept you have demonstrated a need for new builds in Dublin but I also think you were correct in your conservatism.

I think you were correct to assume no shortage carried forward. Rents rising at 10% tell us there was a shortage of supply on market. Vacancy rate of 6.87% tells us that there was not a physical shortage of built units. i.e supply to market was constrained at that time for some reason.

I am assuming the central bank figure for obsoletes is a national one thus it follows that Dublin would be significantly lower. We've had enough discussions about the effects of market demand in Leitrim vs Dublin to know that properties in Dublin will be better maintained than elsewhere.

I would love to see someone in Dept of Housing do the kind of analysis you did at the electoral district level. Clearly Pembroke and Rathmines etc have plenty of stock and if wealth people want to hoard properties in these areas so be it.

But there are areas of Dublin with much lower vacancy rates that are disproportionately likely to attract the population growth and domestic demographic demand.

Localised analysis of these areas would give the public much greater confidence that they had a handle on the situation than simply wailing "Panic, we need to build 50k a year for the next 10 years".

it would also from govt's point of view breakdown the targets to more manageable levels and they could prioritise them - introducing tax/finance incentives for certain areas to achieve this.

Instead it seems like most new building is driven by developer's pockets - they can make more by delivering upscale units in pricier parts of town so that's what they do.

I respect your opinion and views on this and yes much more work is required to understand the reasons for vacancies and return these to the market where possible.

I know the Government have set up a Vacant Homes Unit in the department of housing and have a strategy on vacant
i.e.
https://www.housing.gov.ie/sites/default/files/publications/files/national_vacant_housing_reuse_strategy_0.pdf

Hubertj

schmittel wrote: »

I totally accept you have demonstrated a need for new builds in Dublin but I also think you were correct in your conservatism.

I think you were correct to assume no shortage carried forward. Rents rising at 10% tell us there was a shortage of supply on market. Vacancy rate of 6.87% tells us that there was not a physical shortage of built units. i.e supply to market was constrained at that time for some reason.

I am assuming the central bank figure for obsoletes is a national one thus it follows that Dublin would be significantly lower. We've had enough discussions about the effects of market demand in Leitrim vs Dublin to know that properties in Dublin will be better maintained than elsewhere.

I would love to see someone in Dept of Housing do the kind of analysis you did at the electoral district level. Clearly Pembroke and Rathmines etc have plenty of stock and if wealth people want to hoard properties in these areas so be it.

But there are areas of Dublin with much lower vacancy rates that are disproportionately likely to attract the population growth and domestic demographic demand.

Localised analysis of these areas would give the public much greater confidence that they had a handle on the situation than simply wailing "Panic, we need to build 50k a year for the next 10 years".

it would also from govt's point of view breakdown the targets to more manageable levels and they could prioritise them - introducing tax/finance incentives for certain areas to achieve this.

Instead it seems like most new building is driven by developer's pockets - they can make more by delivering upscale units in pricier parts of town so that's what they do.

Some good points here but it is worth noting that while pembroke has a lot of vacant high end apartments vacant there are also a lot of Georgian houses separated into studios/flats/apartments. They are in varying levels of repair/disrepair depending on how well they were maintained over the years. Rathmines also has a lot of Georgian houses. I think there could be a higher insolence rate in these areas due to the age of the buildings. Pair that with ridiculous planning regs in relation to Protected structures and it likely makes refurbishment cost prohibitive.

Cantstandsya

I've been viewing houses for the past couple of months now and every single house I have looked at has been a probate/executor sale, not one house has been someone moving.

So the non investor/state market right now seems to be entirely FTBs who can either buy a new house or fight over the scraps that are probate/executor sales. There doesn't seem to be anyone selling/upgrading right now.

Anyone else noticed this?

What happens when this trend reverses and a bunch of second hand houses and purchasers hit the market? Will the supply/demand just cancel out or will it make things a bit easier for FTBs who are more likely to be chasing the houses the second time buyers are moving on from?

hometruths

Hubertj wrote: »

Some good points here but it is worth noting that while pembroke has a lot of vacant high end apartments vacant there are also a lot of Georgian houses separated into studios/flats/apartments. They are in varying levels of repair/disrepair depending on how well they were maintained over the years. Rathmines also has a lot of Georgian houses. I think there could be a higher insolence rate in these areas due to the age of the buildings. Pair that with ridiculous planning regs in relation to Protected structures and it likely makes refurbishment cost prohibitive.

Fair point. I’ll start a petition asking for government support for the long suffering owners of Georgian houses in D4 and D6. Can I count on your signature?!

Hubertj

schmittel wrote: »

Fair point. I’ll start a petition asking for government support for the long suffering owners of Georgian houses in D4 and D6. Can I count on your signature?!

I lived in 2 apartments in different building on pembroke road a long time ago. 1 was in very good condition, the other..... landlord told me it is so difficult to do anything to Georgian houses. You are supposed to use lime plaster on walls, pretty much require planning for anything. He put a nice light outside the front door which turned on as people walk up the steps. Georgian society ratted him out.... I believe if you put a new roof on you have to import slate from Wales (not sure if this is true). Landlord also said that while many Georgian houses looke the same they could have been constructed by different builders meaning different levels of quality at initial build.

PropQueries

schmittel wrote: »

Fair point. I’ll start a petition asking for government support for the long suffering owners of Georgian houses in D4 and D6. Can I count on your signature?!

But isn’t that where the derelict property tax comes into play that David McWilliams was suggesting last month. Even Washington D.C. puts a 10% tax on the value of blighted property.

If there’s a cost to holding such a property, they will find the funds very quickly to refurbish it or sell it to an investor who will.

PropQueries

Hubertj wrote: »

I lived in 2 apartments in different building on pembroke road a long time ago. 1 was in very good condition, the other..... landlord told me it is so difficult to do anything to Georgian houses. You are supposed to use lime plaster on walls, pretty much require planning for anything. He put a nice light outside the front door which turned on as people walk up the steps. Georgian society ratted him out.... I believe if you put a new roof on you have to import slate from Wales (not sure if this is true). Landlord also said that while many Georgian houses looke the same they could have been constructed by different builders meaning different levels of quality at initial build.

I’m not too sure I would feel too sorry for him. I’m sure there’s a very very good chance he used that same property he pleads poverty on as security to make other investments

Cyrus

PropQueries wrote: »

Well, if you believe deposit rates will remain at today's level for the next 10 years and that house prices will be worth the same in 10 years time as today (i.e. no increase in the next 10 years), then 2% is a fantastic, amazing relatively risk-free rate of return.

No it’s not it’s not even close to being Fantastic

Smouse156

Can we please ask Daft (it actually justifies its name now) to stop producing ASKING price reports. It’s total ****e:

https://www.breakingnews.ie/business/irish-property-valued-at-less-than-e100000-in-just-two-areas-1050254.html

They’d be better off producing asking prices for cars. No one with a brain would take it seriously!

Kildare997

Cantstandsya wrote: »

I've been viewing houses for the past couple of months now and every single house I have looked at has been a probate/executor sale, not one house has been someone moving.

So the non investor/state market right now seems to be entirely FTBs who can either buy a new house or fight over the scraps that are probate/executor sales. There doesn't seem to be anyone selling/upgrading right now.

Anyone else noticed this?

What happens when this trend reverses and a bunch of second hand houses and purchasers hit the market? Will the supply/demand just cancel out or will it make things a bit easier for FTBs who are more likely to be chasing the houses the second time buyers are moving on from?

Seems to be the same in most areas, large increase in FTB's with mortgage approval now as they were able to save more this year with lockdowns etc. I have seen some sub 350k properties make considerably more than they would have fetched last year! Huge lack of supply in the second hand market and might be worth holding out in my opinion...

PropQueries

Cantstandsya wrote: »

I've been viewing houses for the past couple of months now and every single house I have looked at has been a probate/executor sale, not one house has been someone moving.

So the non investor/state market right now seems to be entirely FTBs who can either buy a new house or fight over the scraps that are probate/executor sales. There doesn't seem to be anyone selling/upgrading right now.

Anyone else noticed this?

What happens when this trend reverses and a bunch of second hand houses and purchasers hit the market? Will the supply/demand just cancel out or will it make things a bit easier for FTBs who are more likely to be chasing the houses the second time buyers are moving on from?

I think those probate sales are going to become more and more important in relation to supply over the next few years.

They’re primarily in prime locations. Life expectancy has increased by about 5 years over the past 20 years which has led to a shortage of this regular supply entering the market over the past 10 years, so it’s about now that they’re entering supply.

Very under-reported, under-analysed and a very important part of the supply coming on stream in the very near future IMO

Timing belt

Cyrus wrote: »

No it’s not it’s not even close to being Fantastic

I agree that its not a Fantastic return but in the current environment it is a extremely good return for such low risk.

The low rate environment is pushing investors into taking on more risk in the chase for yield and is creating bubbles. You only have to look at the DOW at all time high's despite a economy that is struggling.

There is serious risk that we will experience another financial crisis on the back of this that will result in Job losses and impact the property market.