2021 Irish Property Market chat - *mod warnings post 1*

Mic 1972

Smouse156 wrote: »

Personal anecdotes aside only a fool would believe an asking price report as reality!

Stick to the CSO and PPR sales for the area you want to buy, not what the delusional owner is looking for! The simple way to properly view a property is to look at comparable sales in the area and look at the change in the residential price index in the time that has passed. It’s totally irrelevant what someone asks, you should be able to work out the price range regardless.

Asking prices also work both ways, many agents deliberately set low asking prices to attract interest so it’s not meaningful in anyway at all, either up or down! It only indicates sellers expectations.

If you prefer sales prices, reports are available for you to check for yourself.
Sales Prices are going up.

Asking prices are only a real time snapshot of current prices. If you understand a little about reports you'll easily see the correlation between asking and sales prices.

Now relax, no need to resort to insults

Smouse156

Mic 1972 wrote: »

If you prefer sales prices, reports are available for you to check for yourself.
Sales Prices are going up.

Asking prices are only a real time snapshot of current prices. If you understand a little about reports you'll easily see the correlation between asking and sales prices.

Now relax, no need to resort to insults

The problem is currently the correlation is breaking down! Daft delusional post massive rises when CSO post falls...what does that tell you?

Independent analysis is important here. FYI I wouldn’t believe falling asking prices either if selling prices were rising.

Daft/MyHome are looking more and more foolish the last few months with their totally misleading sensationalist headlines trying to drum up business.

My personal opinion is as follows:

1) low supply will lead to rises outside Dublin.
2) Dublin topped out in 2018 due to peek affordability so hard to see any rises with wages falling overall. Don’t expect to see falls below 500k though, over 500k yes
3) anything new qualifying for HTB will rise

Overall 2021 small rise 1/2% driven by HTB new builds and poor supply but I definitely won’t ever believe any asking price reports

Mic 1972

schmittel wrote: »

Sure they are handy for identifying if market is trending up or down. But to use them to claim "House prices in South Dublin have increased by 9.2%" as a fact is nonsense.

The history of the Irish property market from the 2007 bubble burst to 2012 rock bottom to the recovery of recent years is perfectly reflected in the Asking price reports. They never once showed a different trend or unrealistic prices.

Some sellers will set an unreasonable high price, another one may set it too low. But when you look at the comprehensive data, it all averages out to reflect the reality of the market.

You dont' have to use asking prices if you don't like them, but you can't dismiss their statistical relevance.

hometruths

Mic 1972 wrote: »

The history of the Irish property market from the 2007 bubble burst to 2012 rock bottom to the recovery of recent years is perfectly reflected in the Asking price reports. They never once showed a different trend or unrealistic prices.

Some sellers will set an unreasonable high price, another one may set it too low. But when you look at the comprehensive data, it all averages out to reflect the reality of the market.

You dont' have to use asking prices if you don't like them, but you can't dismiss their statistical relevance.

Do you believe that prices in South Dublin are up 9.2% this year?

Mic 1972

schmittel wrote: »

Do you believe that prices in South Dublin are up 9.2% this year?

Do you have reasons to believe otherwise?

Asking prices are up because properties have being going for higher than asking prices all year, and particularly in Q4

I had my personal experience with biddings going way over asking prices to believe than 9.2% seems quite realistic

Villa05

Timing belt wrote:

The one quote that stood out to me was the following:

Another interesting quote from the same article


"Mr White’s judgment, central banks know they cannot leave interest rates as low as they are, because they are inducing still more bad debt and bad behaviour. But they cannot raise rates because then they would trigger the very crisis they are trying to avoid."


It appears a square needs to be circled

Hubertj

schmittel wrote: »

Do you believe that prices in South Dublin are up 9.2% this year?

I’ll be asking €11.2M for my house

Timing belt

Villa05 wrote: »

Another interesting quote from the same article


"Mr White’s judgment, central banks know they cannot leave interest rates as low as they are, because they are inducing still more bad debt and bad behaviour. But they cannot raise rates because then they would trigger the very crisis they are trying to avoid."


It appears a square needs to be circled

The policy of QE is to provide the banks with cash who will then lend this out to customers generating more debt and making the crisis bigger whilst at the same time enabling governments to access the debt markets at a low rates.

If you look at historical lending of private households this has not increased despite this cheap debt being available so the QE never makes into the real economy. This has been the case since 2008 and despite all the best efforts of all the central banks non of them could generate inflation.

This time there is fiscal spending accompanying the QE but this is only filling the hole in GDP caused by Covid. Unless the Governments increase their spending so it is larger than the drop in GDP or there is an increase in private debt we will not see inflation as the cash never makes its way into the real economy.

Even if we do see inflation the central banks will need to sit on their hands and let it happen for the reasons you posted in your quote as they will crash any economic recovery if they act as Governments and the private sector will not be able to cope with the increase in interest repayments.

This is my view as I have said in previous posts the hedge funds appear to be betting on inflation for the past 3 days based on US bond prices. Commodities and Gold are up which should lead to some push inflation. My personal view is that this is a speculative bet as investors try and diversify but never the less it would lead to push inflation which if unaccompanied by economic growth will lead to stagflation as there is real demand.

If there is real demand then we should see pull inflation which we would see either by an increase in lending or a decrease in savings which in turn increase the price of commodities but that is not what we are seeing in the markets at the moment. Maybe I am wrong and we will see in the coming months?

Where does this leave house prices? There will be an increased demand from investors as the yield in Equities and Bonds and nearly every other asset class has dropped. Investment funds/pensions/banks still hold investments made in a higher yield environment but when they mature and it comes to reinvest they will not get the same yield on new investments. So if we are in a low rate environment for the next 10 years we will see more investments in property and the yield on property dropping in line with rental decreases as more supply hits the market.

Update: Prop was not wrong when he questioned the yield on property but where I differ with prop is that I see this adding to the upside pressures on property prices and we won't see downward pressure until the property yields drop or yields in other assets rise.

Louis Friend

Hubertj wrote: »

I’ll be asking €11.2M for my house

And the other thousands of people who are “asking for a price” will behave normally and reasonably.

Hence asking prices are a decent proxy for actual prices.

Timing belt

Louis Friend wrote: »

And the other thousands of people who are “asking for a price” will behave normally and reasonably.

Hence asking prices are a decent proxy for actual prices.

All data is relevant as it tells you something... Just because something has not happened yet is not a reason to discount it. If that was the case everything from consumer confidence to PMI stats should be discounted. The data tells a story but you need to be mindful as it is no different to exit polls in an election they give you an indication but not always the answer.

I am assuming that daft statistically pick up outliners like the 10m and clean the data before it is published and not just have some guy using the average function in excel.

Mic 1972

Louis Friend wrote: »

And the other thousands of people who are “asking for a price” will behave normally and reasonably.

Hence asking prices are a decent proxy for actual prices.

Correct.


Also, data is normalized before reports are published, it's standard process.
Abnormal figures get adjusted or removed.

Smouse156

Mic 1972 wrote: »

Correct.


Also, data is normalized before reports are published, it's standard process.
Abnormal figures get adjusted or removed.

We’ll have CSO Dec figures in about a month. Then we can see the real YoY numbers. I doubt they’ll be close to 9.2%, more likely they’ll be way off

HotDudeLife

Mic 1972 wrote: »

House prices in South Dublin have increased by 9.2%, let's not use anecdotes as evidence of facts.

https://ww1.daft.ie/report/2020-Q4-houseprice-daftreport.pdf?d_rd=1

LOL quotes a report based on asking prices.

HotDudeLife

Mic 1972 wrote: »

Nothing at all is pointing to a price drop in 2021, let alone a 10-15%

I cannot take you seriously if all your evidence is reports based on asking prices or pie in the sky predictions. I have given my rationale on why i believe 2nd hand prices in the FTB price range will drop (albeit slowly and not until near end of the year).

Timing belt

HotDudeLife wrote: »

I cannot take you seriously if all your evidence is reports based on asking prices or pie in the sky predictions. I have given my rationale on why i believe 2nd hand prices in the FTB price range will drop (albeit slowly and not until near end of the year).

The reasons that I can think of why 2nd hand prices in the FTB price range would drop are:
1) Lack of Demand
- Are you suggesting as in earlier posts that the savings in the Banks will be spent on holidays, drink and designer gear and very little on property so there will be little demand for any housing particularly 2nd hand housing in the FTB price range.
- or is it as one of your previous post suggests down to the fact that there are only so many couples who earn a combined salary of over 200k

2) To much supply
- Are you suggesting that there are going to be so many new builds for FTB that will hit the market next year that FTB will not consider 2nd hand properties even if these 2nd hand properties are in a more desirable location with better infrastructure and transport links. Not to sure how this would be possible when the country was shut down for so long with covid but maybe you know something none of us know.
- Are you suggesting that people will want to use their savings and upgrade to a bigger house and flood the market with 2nd properties in the FTB price range.

I am struggling to see your logic as you have previously posted that no-one would want a FTB house and 2nd houses in mature areas are the way to go so why now do you think there will be no demand and prices will drop by 10-15%

HotDudeLife wrote:

In areas close to me, the new builds were whipped up in ridiculous locations and prices well above what they are worth, plus a good chunk of them are allocated to social housing so chance they may become ghettos.


Also who wants to work hard and pay for a brand new house only to have some leech move in next door for free. If something is for free/highly reduced, they won't value it and these areas will turn into dumps.


Second hand houses in mature areas are the way to go.

Prices on 2nd hand homes to drop by 10-15% based on the above sounds like a pie in sky prediction

rks

^^ Thats what they said that the price will drop by 10-20% in 2020. Now its 2021 then it will be 2022. Eventually it will happen, may be some more years down the line and then they will say.... told you so!

HotDudeLife

rks wrote: »

^^ Thats what they said that the price will drop by 10-20% in 2020. Now its 2021 then it will be 2022. Eventually it will happen, may be some more years down the line and then they will say.... told you so!

Very lazy argument, view my last post in property market 2020 and you will see i specifically stated October 2021 as my prediction for said drop.

HotDudeLife

Timing belt wrote: »

The reasons that I can think of why 2nd hand prices in the FTB price range would drop are:
1) Lack of Demand
- Are you suggesting as in earlier posts that the savings in the Banks will be spent on holidays, drink and designer gear and very little on property so there will be little demand for any housing particularly 2nd hand housing in the FTB price range.
- or is it as one of your previous post suggests down to the fact that there are only so many couples who earn a combined salary of over 200k

2) To much supply
- Are you suggesting that there are going to be so many new builds for FTB that will hit the market next year that FTB will not consider 2nd hand properties even if these 2nd hand properties are in a more desirable location with better infrastructure and transport links. Not to sure how this would be possible when the country was shut down for so long with covid but maybe you know something none of us know.
- Are you suggesting that people will want to use their savings and upgrade to a bigger house and flood the market with 2nd properties in the FTB price range.

I am struggling to see your logic as you have previously posted that no-one would want a FTB house and 2nd houses in mature areas are the way to go so why now do you think there will be no demand and prices will drop by 10-15%



Prices on 2nd hand homes to drop by 10-15% based on the above sounds like a pie in sky prediction

Are you suggesting as in earlier posts that the savings in the Banks will be spent on holidays, drink and designer gear and very little on property so there will be little demand for any housing particularly 2nd hand housing in the FTB price range.


I said those who have accumulated the most savings are already property owners and therefore not FTB.

The remainder of the savings cohort will of course include FTBs, but these will already have been chomping at the bit to buy and therefore will no result in a huge influx of FTB. There will be very few who were in no position to buy suddenly after 9 months of savings be able to get on the market, of the rare few who do, these will have a small deposit and will likely only be able to avail of FTB government help to buy scheme.

And obviously people will send money on other items besides property.


- Are you suggesting that there are going to be so many new builds for FTB that will hit the market next year that FTB will not consider 2nd hand properties even if these 2nd hand properties are in a more desirable location with better infrastructure and transport links. Not to sure how this would be possible when the country was shut down for so long with covid but maybe you know something none of us know.


It's not a matter of preference, it's a matter of finances. Vast majority of FTBs are only in a position to buy because of the help to buy scheme (HTB). The HTB is for new builds only. New builds include an element of social housing, if you haven't read the news, construction sites have shut down and will likely be closed for a few months with the exception of...you guessed it construction sites that are for social housing i.e new builds.

- Are you suggesting that people will want to use their savings and upgrade to a bigger house and flood the market with 2nd properties in the FTB price range.


This is a possibility but i never stated that. Many of those with savings are already property owners and some may be in a better position to upsize.



I am struggling to see your logic as you have previously posted that no-one would want a FTB house and 2nd houses in mature areas are the way to go so why now do you think there will be no demand and prices will drop by 10-15%


Why are you making things up? Can't believe i wasted my time addressing your points. My point remains that a vast majority of FTBs who have AIP can only purchase property due to the HTB scheme which is limited to new builds, thus ruling them out of second hand property within the 220-350k (typically FTB) price range.

I personally think second hand property in mature areas are better than new builds but i never made that argument as that's why prices would drop, which doesn't even make sense, why are you lying to discredit my predictions?

HotDudeLife

I just realized you weren't even the poster whom i addressed my original comment to.

This is bizarre, i simply make a point stating i predict second hand properties will drop towards the end of the year and i am ganged up upon lol and other posters jump in with blatant lies. Sums up society at the moment.

accensi0n

HotDudeLife wrote: »

I just realized you weren't even the poster whom i addressed my original comment to.

This is bizarre, i simply make a point stating i predict second hand properties will drop towards the end of the year and i am ganged up upon lol and other posters jump in with blatant lies. Sums up society at the moment.

You also said you wouldn't log back in here until Oct 2021.

Timing belt

HotDudeLife wrote: »

Are you suggesting as in earlier posts that the savings in the Banks will be spent on holidays, drink and designer gear and very little on property so there will be little demand for any housing particularly 2nd hand housing in the FTB price range.


I said those who have accumulated the most savings are already property owners and therefore not FTB.

The remainder of the savings cohort will of course include FTBs, but these will already have been chomping at the bit to buy and therefore will no result in a huge influx of FTB. There will be very few who were in no position to buy suddenly after 9 months of savings be able to get on the market, of the rare few who do, these will have a small deposit and will likely only be able to avail of FTB government help to buy scheme.

And obviously people will send money on other items besides property.


- Are you suggesting that there are going to be so many new builds for FTB that will hit the market next year that FTB will not consider 2nd hand properties even if these 2nd hand properties are in a more desirable location with better infrastructure and transport links. Not to sure how this would be possible when the country was shut down for so long with covid but maybe you know something none of us know.


It's not a matter of preference, it's a matter of finances. Vast majority of FTBs are only in a position to buy because of the help to buy scheme (HTB). The HTB is for new builds only. New builds include an element of social housing, if you haven't read the news, construction sites have shut down and will likely be closed for a few months with the exception of...you guessed it construction sites that are for social housing i.e new builds.

- Are you suggesting that people will want to use their savings and upgrade to a bigger house and flood the market with 2nd properties in the FTB price range.


This is a possibility but i never stated that. Many of those with savings are already property owners and some may be in a better position to upsize.



I am struggling to see your logic as you have previously posted that no-one would want a FTB house and 2nd houses in mature areas are the way to go so why now do you think there will be no demand and prices will drop by 10-15%


Why are you making things up? Can't believe i wasted my time addressing your points. My point remains that a vast majority of FTBs who have AIP can only purchase property due to the HTB scheme which is limited to new builds, thus ruling them out of second hand property within the 220-350k (typically FTB) price range.

I personally think second hand property in mature areas are better than new builds but i never made that argument as that's why prices would drop, which doesn't even make sense, why are you lying to discredit my predictions?

There is no lying just questions base on your previous posts... you have clarified your theory and if I understand it correctly you are saying that there will be adequate supply of FTB new builds and FTB won't buy 2nd hand as they will not avail of the HTB scheme and without it these properties will be unaffordable so will come down in price by 10-15% by Oct 2021.

So in summary you are saying that HTB only leads to price increases in new builds that FTB can afford and has a negative impact on second hand homes.

Just trying to make sure I understand your exact reasoning....

HotDudeLife

Timing belt wrote: »

There is no lying just questions base on your previous posts... you have clarified your theory and if I understand it correctly you are saying that there will be adequate supply of FTB new builds and FTB won't buy 2nd hand as they will not avail of the HTB scheme and without it these properties will be unaffordable so will come down in price by 10-15% by Oct 2021.

So in summary you are saying that HTB only leads to price increases in new builds that FTB can afford and has a negative impact on second hand homes.

Just trying to make sure I understand your exact reasoning....

No problem, yes that is the biggest factor in my prediction along with other macro factors such as global recession, job losses, stagnation and possible reduction workers pay etc.

HotDudeLife

accensi0n wrote: »

You also said you wouldn't log back in here until Oct 2021.

True, the christmas/new year downtime got the better of me. When i saw the new thread i couldn't resist. The devil makes work for idle hands

Timing belt

HotDudeLife wrote: »

No problem, yes that is the biggest factor in my prediction along with other macro factors such as global recession, job losses, stagnation and possible reduction workers pay etc.

I was just extracted the data for FTB in Dublin from the CSO to see the split between new properties and second hand properties.

Data from 2018 - Oct 2020

Overall the volume of FTB Transactions in Dublin are down 28.4% compared to the equivalent 10 months in 2019 but it it appears that there has been an increase second hand transactions when compared to new build transactions.

i.e.

TheSheriff

HotDudeLife wrote: »

No problem, yes that is the biggest factor in my prediction along with other macro factors such as global recession, job losses, stagnation and possible reduction workers pay etc.

HTB / shared equity scheme will increase the prices of all properties. It's foolish to think otherwise.

The government's new shared equity scheme will keep properties (both new and second hand) on an upward trajectory for the foreseeable.

HotDudeLife

TheSheriff wrote: »

HTB / shared equity scheme will increase the prices of all properties. It's foolish to think otherwise.

The government's new shared equity scheme will keep properties (both new and second hand) on an upward trajectory for the foreseeable.

"Foolish", how so?

FileNotFound

I don't see that much of a price drop coming. HTB will help maintain new build prices. Plenty of people can afford under 350k houses & apartments.

Anyone with property above may just sit on it until the market improves.

Limited building in addition to this.

Timing belt

Dafterss wrote: »

You may not have a job next year a lot of small shops will close .people should save for the next crash as it will be huge.the world governments are pumping money into the world stock markets and housing markets.and keeping rates low.its like using a bucket on the titanic
I read it will take 20 years to vaccinate everyone for covid. You will see covid around for next 4-5 years doing financial damage.if you have cash move it to 4 or 5 places so if there's a bank crash you will not be wiped out

If you are that convinced that things are that bad and a crash is coming go long on Bonds and cash out when all the money flows in after stock market crashes and buy cheap equities with your gains.

if you think the economy is going to boom and see inflation buy property,Bitcoin, gold and go short on bond and then wait for the stock market to crash when central banks raise rates

the market is very divided as to what will happen but we know that unless we see moderate inflation and growth there is a high likelihood of a crash.

Banks should be safe this time around as they have adequate capital and are better regulated but may need to restrict credit if to much capital used dealing with the crisis which would impact house prices

Mic 1972

HotDudeLife wrote: »

I cannot take you seriously if all your evidence is reports based on asking prices or pie in the sky predictions. I have given my rationale on why i believe 2nd hand prices in the FTB price range will drop (albeit slowly and not until near end of the year).

The current trends s are all pointing upwards, both asking prices and sales prices. You are predicting a major drop 10-15%
From a statistical point of view it's nonsense. Trends don't change like that overnight.
The assumptions you are making about lack of demands for second hand houses don't seem very realistic.

Demand is high and supply is low

combat14

Mic 1972 wrote: »

The current trends s are all pointing upwards, both asking prices and sales prices. You are predicting a major drop 10-15%
From a statistical point of view it's nonsense. Trends don't change like that overnight.
The assumptions you are making about lack of demands for second hand houses don't seem very realistic.

Demand is high and supply is low

how strong is the up trend for 2021