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

Villa05

fliball123 wrote:

I have put up the math why I think that housing is affordable on the current median wage a couple buying and that there is currently over half the supply available (on myhome) for under the amount I calculated currently. We have a chronic supply issue at the moment which is not the same as an affordability issue.

I think your couple in your sample had a combined income of 80k. Can you tell me what proportion of households have an income of 80k or higher.

If the remainder have to be housed and many subsidised by Mr and Mrs average. It is in the interests of the entire population to have sufficient supply in various price points where possible using different housing models that have achieved it elsewhere.

If supply is suppressed and housing is provided predominantly by the private market, as night follows day a supply issue leads to an affordability issue

fliball123 wrote:

Why is your contention that everyone should be able to buy a mansion over looking the sea there in Howth thats just not possible, people like yourself need to understand that if they want to live in a highly desirable place with A1 energy ratings and without the need to pump money into the property there is a premium that will need to be paid as is the case everywhere in the world. This is what you and others like you dont seem to comprehend when it comes to property. Whats the old crack about whats the top 3 words people think about when it comes to property ?? Location location location.

That is not my contention and I do not understand why you are associating that ideology with me. seen as I have strongly opposed the state paying silly money for housing units in upmarket areas.
You on the other hand seemed passive on the topic,

There are alternatives such as co operative housing at a reasonable distance to work

Ref A1 rated homes, makes sense to do it when building. The cost could be spread out over a number of years by a tax that matches the savings of having an A1 rated house or better. Simple solution, net zero cost

JimmyVik

Villa05 wrote: »

I think your couple in your sample had a combined income of 80k. Can you tell me what proportion of households have an income of 80k or higher.

If the remainder have to be housed and many subsidised by Mr and Mrs average. It is in the interests of the entire population to have sufficient supply in various price points where possible using different housing models that have achieved it elsewhere.

If supply is suppressed and housing is provided predominantly by the private market, as night follows day a supply issue leads to an affordability issue



That is not my contention and I do not understand why you are associating that ideology with me. seen as I have strongly opposed the state paying silly money for housing units in upmarket areas.
You on the other hand seemed passive on the topic,

There are alternatives such as co operative housing at a reasonable distance to work

Ref A1 rated homes, makes sense to do it when building. The cost could be spread out over a number of years by a tax that matches the savings of having an A1 rated house or better. Simple solution, net zero cost

From my own experience, I dont know any couple both working who have an income lower than €80k. Now if only one is working then I know a few, especially since the pandemic started.

Yurt2

fliball123 wrote: »

I have put up the math why I think that housing is affordable on the current median wage a couple buying and that there is currently over half the supply available (on myhome) for under the amount I calculated currently. We have a chronic supply issue at the moment which is not the same as an affordability issue. Why is your contention that everyone should be able to buy a mansion over looking the sea there in Howth thats just not possible, people like yourself need to understand that if they want to live in a highly desirable place with A1 energy ratings and without the need to pump money into the property there is a premium that will need to be paid as is the case everywhere in the world. This is what you and others like you dont seem to comprehend when it comes to property.

Schrödinger's property market according to fliball. A market that is both chronically supply constrained and affordable at the same time.

Nobody is talking sea overlooking properties in Howth except you, and asking price does not equal sale price.

DataDude

JimmyVik wrote: »

From my own experience, I dont know any couple both working who have an income lower than €80k. Now if only one is working then I know a few, especially since the pandemic started.

Few years out of date but CSO data would indicate 22.6% of households earn over €80k per annum. Since from 2016 would probably fair to assume a little higher now.

Don't think this is one where personal experience is much value as everyone's experience will probably be highly dependent on their own financial situation.

https://www.cso.ie/en/releasesandpublications/ep/p-gpii/geographicalprofilesofincomeinireland2016/incomeinireland/

L1011

Discussion of hypothetical political platforms should take place in the Politics or Humanities forums, but not here

awec

PropQueries wrote: »

Well DCC recently came out and said they’re in active negotiations to buy or rent c. 4,000 properties in the city.

How else are they arriving at the end price without a competitive bidding process?

It’s like bidding against someone who just won the euromillions.

You’re almost destined to lose but it’s even worse if you do win because you’ve then probably agreed to pay way over the price that you would have paid if DCC wasn’t the counter bidder IMO

Can you post us the link that outlines how DCC are taking calls from estate agents seeking to get them involved in a bidding war?

The process for selling your gaff to the council is outlined here: https://www.dublincity.ie/residential/housing/i-own-my-home/rent-or-sell-your-property/sell-your-property-us

Browney7

Mic 1972 wrote: »

Prices have already gone up a lot in the last 2-3 months as experienced by anyone who has been bidding lately. It will be interesting to see the actual % increase over 12 months.
I would say an 8-10% increase YOY is not unlikely.

Are you basing the last 2-3 on asking prices or from the PPR or some other data? My own expectation that prices for turnkey houses have been strong with prices for apartments being stagnant and slow to shift

fliball123

decreds wrote: »

Some construction projects are being built as we speak and we will see ramped up supply once construction resumes for all projects.


We will see more supply being added between 2020-2024 than all of 2012-2020, despite the lockdowns.

Have you looked at the population of the country over the same period?? or to make it easy for you, You have a week where your selling apples and on day one you have 10 apples but 20 people want an apple you have a supply problem basically not enough supply to meet demand so on day 2 you have upped to 20 apples but now 40 people want an apple you still have the same supply problem even do you have increased it. How do you like them apples

AlmightyCushion

DataDude wrote: »

Few years out of date but CSO data would indicate 22.6% of households earn over €80k per annum. Since from 2016 would probably fair to assume a little higher now.

Don't think this is one where personal experience is much value as everyone's experience will probably be highly dependent on their own financial situation.

https://www.cso.ie/en/releasesandpublications/ep/p-gpii/geographicalprofilesofincomeinireland2016/incomeinireland/

Household income includes people in houseshares and people living with their parents. I live in a houseshare. Our household income would be over 100k but individually none of us earn over 80k and if we were buying tomorrow we wouldn't be buying with each other. Same as if I was living with my parents. The household income would be over 80k.

fliball123

PommieBast wrote: »

I take the complimentary view: If a property needs remedial work (or has some other liability) it gets subtracted from the asking price. Textbook asset depreciation. Too many vested interests for this to ever be fixed.

Is that working like that in the market right now?

awec

fliball123 wrote: »

Yeah I think the market is a little flawed in some respects .. If you pump say a 100k into a gaff and have it done up to the nines and you and your next door neighbour are putting up at the same time and they have done nothing to the house the premium you get for your add-ons is p1ss poor

PommieBast wrote: »

I take the complimentary view: If a property needs remedial work (or has some other liability) it gets subtracted from the asking price. Textbook asset depreciation. Too many vested interests for this to ever be fixed.

fliball123 wrote: »

Is that working like that in the market right now?

It's important to distinguish between required remedial works to bring a property up to standard vs optional improvements, which may be worth less to a buyer than they are to you.

If there's something wrong with a house that needs fixed you'd usually negotiate that out of the price.

Sweet.Science

https://m.independent.ie/news/state-faces-legal-challenge-to-discriminatory-covid-19-construction-restrictions-40162601.html

They may actually have a good case here

The state were a bit naive sperating social housing construction and private housing construction

fliball123

Villa05 wrote: »

I think your couple in your sample had a combined income of 80k. Can you tell me what proportion of households have an income of 80k or higher.

If the remainder have to be housed and many subsidised by Mr and Mrs average. It is in the interests of the entire population to have sufficient supply in various price points where possible using different housing models that have achieved it elsewhere.

If supply is suppressed and housing is provided predominantly by the private market, as night follows day a supply issue leads to an affordability issue



That is not my contention and I do not understand why you are associating that ideology with me. seen as I have strongly opposed the state paying silly money for housing units in upmarket areas.
You on the other hand seemed passive on the topic,

There are alternatives such as co operative housing at a reasonable distance to work

Ref A1 rated homes, makes sense to do it when building. The cost could be spread out over a number of years by a tax that matches the savings of having an A1 rated house or better. Simple solution, net zero cost

no in my example they have 72k combined salary or just below the median wage in the country. The median salary in Ireland in 2018 was just over 36k. I am not doing the sums again. Look up the median wage if you dont believe me.

There is a severe supply problem there is no doubt about that but what I could show was that currently on myhome even with a severe supply problem there was over half the available properties for sale at under the 275k mark which is a price point that those on and above the median salary could afford.

fliball123

Yurt! wrote: »

Schrödinger's property market according to fliball. A market that is both chronically supply constrained and affordable at the same time.

Nobody is talking sea overlooking properties in Howth except you, and asking price does not equal sale price.

price has been constrained by the lending limits put in by the ECB , if you took them away prices would absolutely rocket up.

Villa05

awec wrote:

Can you post us the link that outlines how DCC are taking calls from estate agents seeking to get them involved in a bidding war?

If you intend selling your house, do you
A go to your local authority
B go to your local estate agent

DataDude

AlmightyCushion wrote: »

Household income includes people in houseshares and people living with their parents. I live in a houseshare. Our household income would be over 100k but individually none of us earn over 80k and if we were buying tomorrow we wouldn't be buying with each other. Same as if I was living with my parents. The household income would be over 80k.

Fair point. Revenue have data from 2018 based on "taxpayer units". Married couples jointly assessed are considered one person essentially. I've just downloaded really quickly and unless I'm doing something stupid (possible!) it would indicate only 5.7% of taxpayer units earn over €80k.

Married both couples earning - 8.3% over €80k
Married one couple earning - 8.8% over €80k

These numbers seem remarkably low to me, but don't have time to investigate further. Maybe another time!

EDIT - If you take out the large number in 0-10k bracket (i.e. not working?) then the figures above go to 6.8%, 9.1% and 10.0%. Still seems very low though!

https://www.revenue.ie/en/corporate/information-about-revenue/statistics/income-distributions/individualised-gross-income-distributions.aspx

JimmyVik

Just off the phone about something thats been in the works for a while now.
I bought a house recently.
Had started doing a few bits and bobs but not moved in yet.
A few weeks ago i got a call from the EA i bought it with and he said he had someone who wanted to pay me well over and above what I paid for it already.
I wasnt sure, so i waited and they came back with a better offer. So I countered, sure why not.
And they said yes.
So as of today the house I bought and havent moved into is sale agreed.
And this time last year all I wanted was to rent an apartment in the city center, which im glad never happened now.
In a year or two i might go looking to buy again.

fliball123

awec wrote: »

It's important to distinguish between required remedial works to bring a property up to standard vs optional improvements, which may be worth less to a buyer than they are to you.

If there's something wrong with a house that needs fixed you'd usually negotiate that out of the price.

That all depends on other factors if you have 5 people wanting 1 property for example, your going to sell to the person who you will get the greater profit from and who will be willing to cover costs to do the property up themselves.

I do actually aagree with your contention that what you outline is how it should work in a normal market but our property market is far from that.

PropQueries

awec wrote: »

Can you post us the link that outlines how DCC are taking calls from estate agents seeking to get them involved in a bidding war?

The process for selling your gaff to the council is outlined here: https://www.dublincity.ie/residential/housing/i-own-my-home/rent-or-sell-your-property/sell-your-property-us

Here’s an example from the Irish Times in November 2020:

“The house had gone on the market in 2018 for €450,000 but was earlier this year offered for sale for €625,000 despite its condition having deteriorated in the intervening years. The house was also broken into last year and its basement level is now boarded up.

It is understood the council paid in the region of €750,000 for the building which could cost more than €1 million to refurbish and convert into homeless accommodation.”

So, if I was interested in that property, DCC’s involvement in the bidding process increased its “market value” from €450k to €750k in less than two years.

I would have had to offer almost double the “market price” in order to outdid DCC. Even then they would have probably outbid me again.

Now apply that to the c. 4,000 properties DCC said they are currently in active negotiations with in the city.

Link to Irish Times article here: https://www.irishtimes.com/culture/heritage/se%C3%A1n-o-casey-s-last-dublin-home-bought-by-city-council-to-house-homeless-1.4401169

fliball123

PropQueries wrote: »

Here’s an example from the Irish Times in November 2020:

“The house had gone on the market in 2018 for €450,000 but was earlier this year offered for sale for €625,000 despite its condition having deteriorated in the intervening years. The house was also broken into last year and its basement level is now boarded up.

It is understood the council paid in the region of €750,000 for the building which could cost more than €1 million to refurbish and convert into homeless accommodation.”

So, if I was interested in that property, DCC’s involvement in the bidding process increased its “market value” from €450k to €750k in less than two years.

I would have had to offer almost double the “market price” in order to outdid DCC. Even then they would have probably outbid me again.

Now apply that to the c. 4,000 properties DCC said they are currently in active negotiations with in the city.

Link to Irish Times article here: https://www.irishtimes.com/culture/heritage/se%C3%A1n-o-casey-s-last-dublin-home-bought-by-city-council-to-house-homeless-1.4401169

How do yo know DCC has pushed it up this far?

JimmyVik

AlmightyCushion wrote: »

Household income includes people in houseshares and people living with their parents. I live in a houseshare. Our household income would be over 100k but individually none of us earn over 80k and if we were buying tomorrow we wouldn't be buying with each other. Same as if I was living with my parents. The household income would be over 80k.

Most people going off to buy a house will be coupling up.
So even though their income might be separate now, it will total up to a new household income.

AlmightyCushion

JimmyVik wrote: »

Most people going off to buy a house will be coupling up.
So even though their income might be separate now, it will total up to a new household income.

It still doesn't mean that 22% will have a joint income over 80k.

AlmightyCushion

DataDude wrote: »

Fair point. Revenue have data from 2018 based on "taxpayer units". Married couples jointly assessed are considered one person essentially. I've just downloaded really quickly and unless I'm doing something stupid (possible!) it would indicate only 5.7% of taxpayer units earn over €80k.

Married both couples earning - 8.3% over €80k
Married one couple earning - 8.8% over €80k

These numbers seem remarkably low to me, but don't have time to investigate further. Maybe another time!

EDIT - If you take out the large number in 0-10k bracket (i.e. not working?) then the figures above go to 6.8%, 9.1% and 10.0%. Still seems very low though!

https://www.revenue.ie/en/corporate/information-about-revenue/statistics/income-distributions/individualised-gross-income-distributions.aspx

You also have to remember that a lot of the over 80k bracket could be older people who already own a house and are not looking to buy. The highest earners on my team at work would all be older people who own their house and aren't looking to buy or at least haven't brought it up any time we talk.

JimmyVik

AlmightyCushion wrote: »

It still doesn't mean that 22% will have a joint income over 80k.

It means enough people will have it to suck up an awful lot of houses on the market. Or at the very least be strong bidders against people who dont have it.

PropQueries

fliball123 wrote: »

How do yo know DCC has pushed it up this far?

Well if not it raises even more questions.

Why then did DCC pay €300k more than what the seller thought was the “market value” in 2018 and €125k more than that same seller thought the “market value” was only a few months beforehand.

The only way DCC could justify paying €750k when the advertised asking price was €625k was if another bidder was involved i.e. they outbid a private bidder using taxpayer funds.

awec

PropQueries wrote: »

Here’s an example from the Irish Times in November 2020:

“The house had gone on the market in 2018 for €450,000 but was earlier this year offered for sale for €625,000 despite its condition having deteriorated in the intervening years. The house was also broken into last year and its basement level is now boarded up.

It is understood the council paid in the region of €750,000 for the building which could cost more than €1 million to refurbish and convert into homeless accommodation.”

So, if I was interested in that property, DCC’s involvement in the bidding process increased its “market value” from €450k to €750k in less than two years.

I would have had to offer almost double the “market price” in order to outdid DCC. Even then they would have probably outbid me again.

Now apply that to the c. 4,000 properties DCC said they are currently in active negotiations with in the city.

Link to Irish Times article here: https://www.irishtimes.com/culture/heritage/se%C3%A1n-o-casey-s-last-dublin-home-bought-by-city-council-to-house-homeless-1.4401169

I'm sorry, but this is a ridiculous leap of logic.

Every single bidder involved increased the end price. DCC was just one. There could have been 5 others.

I'm not sure what you're on about when you say "double the market price". The market price is whatever it sells for on the market, whatever amount someone was willing to pay for it. In this case it was 750. The underbidder could have hit their limit at 740.

You are trying to imply if it weren't for DCC this house would have sold for closer to 450. There is absolutely nothing to suggest this is true. IMHO it is a deliberately disingenuous statement to make.

You also said that Estate Agents were ringing DCC to get them involved in bidding wars. Again, there is nothing to suggest that this is true.

fliball123

PropQueries wrote: »

Well if not it raises even more questions.

Why then did DCC pay €300k more than what the seller thought was the “market value” in 2018 and €125k more than that same seller thought the “market value” was only a few months beforehand.

The only way DCC could justify paying €750k when the advertised asking price was €625k was if another bidder was involved i.e. they outbid a private bidder using taxpayer funds.

Did it not stat that it went back up for 625k after been taken off for 2 years??? I dont think DCC can be blamed for the jump in price while the property was off the market, whatever about paying 750k for a 625k asking price. But I agree it is a bit mad to pay that. I guess we will have to see how many units they get out of an outlay of 1.75million if they can house say more than 5/6 families it could economically seen in the current climate as good value as apposed to giving these families their own individual house. but its all guess work what way it will be used.

Yurt2

AlmightyCushion wrote: »

It still doesn't mean that 22% will have a joint income over 80k.

Around the time of the last census I was living in a houseshare with 3 others. For CSO statistical purposes, we comprised a household (and if you look into CSO definitions we would have been reported as such). Our household income would have been reported as (I'd guess) about 200k.

That's not an unusual arrangement in Ireland and in Dublin in particular. We have to be careful when presenting household income and overlaying those stats as something evidential about the housing market and affordability.

fliball123

Yurt! wrote: »

Around the time of the last census I was living in a houseshare with 3 others. For CSO statistical purposes, we comprised a household (and if you look into CSO definitions we would have been reported as such). Our household income would have been reported as (I'd guess) about 200k.

That's not an unusual arrangement in Ireland and in Dublin in particular. We have to be careful when presenting household income and overlaying those stats as something evidential about the housing market and affordability.

I am sure you can easily write that off with all of the black market profits being made out there so a sparks/plumber any tradesman say on 40k odd would have a few side gigs going on and have a lot more in their pockets with untaxed work.

not to mention teachers/grinds, taxi drivers agreeing a price and not putting the meter on. landlords not declaring rent... ETC

PropQueries

awec wrote: »

I'm sorry, but this is a ridiculous leap of logic.

Every single bidder involved increased the end price. DCC was just one. There could have been 5 others.

I'm not sure what you're on about when you say "double the market price". The market price is whatever it sells for on the market. In this case it was 750.

Yes and DCC outbid them all. It was DCC that drove that “market price” from €450k to €750k.

If DCC wasn’t involved the “market price” would have been much lower.

And given that DCC are currently in active negotiations with at least c. 4,000 property owners in the city, that big “demand” you keep telling us is there and driving up prices is actually DCC and not families seeking a home in the city.

Once DCC withdraws from the market, that will be a big problem for anyone selling their property IMO