Irish Property Market 2020 Part 3

Bass Reeves

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.

If you want to make invest at a 2% return, it will barley cover maintenance costs over the long term off with you. I would not look at less than a 10% return on investment at present too many variables.

Last people that invested on a 2% return, 2006/2007 list there shirt it.

It your money invest away. I stay on the sidelines and wait if I invest again

Cyrus

Anyone who thinks a 2 percent return pre tax is fantastic has never done an investment appraisal that’s for sure .

Mattish

I can definitely see how sub 350k properties are going over asking with the dismal quality of places available to buy right now.

My partner and I are FTBs and have just drawn up our savings spreadsheet and have a 50k goal. 40k for a deposit and 10k for the extra costs, some furniture etc. Not only is the prospect of saving 50k while renting just to put a deposit on a house slightly daunting, its depressing knowing that the type of house we'll be able to get in the 400k bracket will likely need further work.

I think I speak for most FTBs when I say that we will absolutely try to maximise our borrowings as much as possible - even if we could get a mortgage at 5x our combined salary, repayments would be cheaper than our current rent. So, if we saw a suitable property with an asking of 335k, we would happily, HAPPILY offer up to 400k just to stop giving our landlord a substantial portion of our hard-earned wages every month and start to build equity - and wealth.

Timing belt

Cyrus wrote: »

Anyone who thinks a 2 percent return pre tax is fantastic has never done an investment appraisal that’s for sure .

I never said it was fantastic nor mention pre tax.

I said it is a good return for a low risk asset in current market conditions.

What is the alternative :
- Do not invest and sit on the sidelines.... leaving the cash in the bank and be charged a negative rate and therefore depleting your capital that you have to invest.
- Investing in a riskier asset to get your required yield.

Smiley11

fergus1001 wrote: »

anyone expecting a big upheaval from no deal brexit ?

My uneducated guess would be no. I think it all boils down to supply & demand & thats going to hamper buyers for the forseeable. Unless property owners realise now is a fantastic time to sell & take the plunge in their droves, the UK won't matter at all. I wish it would but its all too unpredictable at the moment.

Cyrus

Timing belt wrote: »

I never said it was fantastic nor mention pre tax.

I said it is a good return for a low risk asset in current market conditions.

What is the alternative :
- Do not invest and sit on the sidelines.... leaving the cash in the bank and be charged a negative rate and therefore depleting your capital that you have to invest.
- Investing in a riskier asset to get your required yield.

I wasn’t referring to you and any returns mentioned here are pre tax.

I’d argue a diversified portfolio of equities is less risky and far less hassle.

Gael23

Had my eye on a 2 bed apartment in Dublin and the price has just been increased by €50k.
Obviously no room for single income first time buyers in the Dublin market

Mad_maxx

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

5% is a very poor return , currently the IRES reit is paying a 4% plus dividend yield , granted you cant borrow to invest in it but for a cash buyer , i know which id rather be in

Gael23

Gael23 wrote: »

Had my eye on a 2 bed apartment in Dublin and the price has just been increased by €50k.
Obviously no room for single income first time buyers in the Dublin market

There are loads!
What is your limit?

Gael23

bubblypop wrote: »

There are loads!
What is your limit?

With savings I think I can manage 220k, a small bit more for somewhere perfect.

1 bedroom is ok but I need enough space for a home office and I’m not seeing one bed apartments with that. Also need to be close to amenities and public transport. Anywhere I’ve seen I can afford isn’t in a great area. Saw a lovely apartment in parkwest but right next door to cloverhill prison

Reins

fergus1001 wrote: »

anyone expecting a big upheaval from no deal brexit ?

https://www.boards.ie/vbulletin/showthread.php?t=2058138757&page=33

Try asking that question on above thread, you might get more informed answers there.

PropQueries

Mad_maxx wrote: »

5% is a very poor return , currently the IRES reit is paying a 4% plus dividend yield , granted you cant borrow to invest in it but for a cash buyer , i know which id rather be in

Where, in all honestly, do you believe you would get 5% risk free?

Cyrus

PropQueries wrote: »

Where, in all honestly, do you believe you would get 5% risk free?

Why do you keep referring to property investment as risk free ? The same poster who is predicting at 75 percent decrease in the value of the underlying asset.

Graham

Mod Note

there's an entire forum dedicated to investments & markets for anyone that's interested in continuing that discussion.

PropQueries

Cyrus wrote: »

Why do you keep referring to property investment as risk free ? The same poster who is predicting at 75 percent decrease in the value of the underlying asset.

It’s 100% risk free if you believe interest rates won’t rise and there’s a genuine shortage of property.

Graham

Mod Note

PropQueries thread banned for 1 week.

Do not reply to this post.

Mad_maxx

<SNIP>

combat14

looks like in addition to covid pandemic, we are facing a no deal brexit next year with possible trade war, wto tarrifs with our nearest neighbour and trading partner

any thoughts on what no deal brexit could do to our economy and ultimately housing market?!

Pelezico

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?

People are battening down the hatches and who can blame them. Covid has knocked the stuffing our of the economy and Brexit has not yet been resolved.

Balluba

The Daft Report for Q4 is out today. I think it is unusual for it to be published on a Sunday

Mic 1972

Balluba wrote: »

The Daft Report for Q4 is out today. I think it is unusual for it to be published on a Sunday

it's the rent report, not the sale price report

Balluba

Mic 1972 wrote: »

it's the rent report, not the sale price report

It is an analysis of trends in the premium property market 2020

Prices still rising and no sign of it easing.We are just going to have to get used to spending more of our income on housing. Cant see prices
dropping unless we get a major recession.

We aren't building enough either and we have to find accommodation for both genuine and fake refugees who decide to make their way to Ireland too.

Villa05

We can't discuss politics
We can't discuss investments and markets
Yet
Politics incentives powerful investment funds to hover up property. These are leased by the state on long term leases at peak rents. Investment funds can mop up these rents and pay little or no tax.
This policy is paid for by taxpayers who pay huge rents and taxes and have to compete against each other for the scraps that are left after the investment funds have had their feast at taxpayers expense

Wars have been started for alot smaller indiscretions,

But on boards this is not relevant, carry on and suck it up

hometruths

Villa05 wrote: »

We can't discuss politics
We can't discuss investments and markets
Yet
Politics incentives powerful investment funds to hover up property. These are leased by the state on long term leases at peak rents. Investment funds can mop up these rents and pay little or no tax.
This policy is paid for by taxpayers who pay huge rents and taxes and have to compete against each other for the scraps that are left after the investment funds have had their feast at taxpayers expense

Wars have been started for alot smaller indiscretions,

But on boards this is not relevant, carry on and suck it up

Agreed that is seems odd property investment has been added to the growing list of verboten topics in the most active property thread in the Accommodation and Property forum.

Hubertj

I would have thought politics would be for the politics forum (or whatever it’s called). Some of the other discussion in this forum would probably be better placed in the conspiracy theory or fiction section (if there are such forums)

I did find the discussion on actual data and figures the last few days very interesting.

Graham

Mod Note

if you have an issue with moderation, you are welcome to PM mods to discuss.

As is common across Boards, moderation is not be be discussed on-thread.

BryanMartin21

Villa05 wrote: »

We can't discuss politics
We can't discuss investments and markets
Yet
Politics incentives powerful investment funds to hover up property. These are leased by the state on long term leases at peak rents. Investment funds can mop up these rents and pay little or no tax.
This policy is paid for by taxpayers who pay huge rents and taxes and have to compete against each other for the scraps that are left after the investment funds have had their feast at taxpayers expense

Wars have been started for alot smaller indiscretions,

But on boards this is not relevant, carry on and suck it up

Next election, don't vote for FF and FG. It's as simple as that for anyone who has an issue with the state of the property market. As simple as that to give two fingers to the current state of the market. I would strongly recommend a protest vote.

drogon.

combat14 wrote: »

any thoughts on what no deal brexit could do to our economy and ultimately housing market?!

50% of people in this thread will say, everything will crash and burn.
another 50% will say everything will be grand, prices will continue to rise.

So honestly very hard to gauge where it will go with that question in here !

selassie

It seems property prices go up no matter what happens right now with the economy. If there's a downturn then builders stop building so lack of supply causes prices to go up. If the economy is booming we still aren't building enough housing to cope with demand.

The only naive solution I have is for the state to build houses themselves, massive apartment blocks on all land they own in Dublin. Even if it cost more than it'd cost for private developers they just need to maximize the amount of houses/year(and the transport/other infra that comes with them).