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

Hubertj

Timing belt wrote: »

The bubble is already totally out of control and it's not just in the property market.... Interest rates have been falling for 45 years and every-time rates are reduced the market reprices assets by increasing the asset cost to reflect the new yield. It is the main reason why the stock market always gives a return and why people say in the long term you are better investing in the stock market. Every time rates rise or when a central bank tappers its QE the market crashes just look at the market last week they were expecting the fed to announce new QE with a Twist to manage the yield curve and it didn't happen and prices started heading south. Will the central banks continue to step in and try and pump the markets and keep them going... yes until they have used every last thing in there arsenal and they still have a bit of dry powder left so I wouldn't be surprised if rates went lower to keep the boat afloat.

You make a big deal of the Tax issue and I understand where you are coming from but the US and the UK have to many vested interests to allow any meaningful change. If they were serious about that they would close loopholes first but that hasn't happened and won't so it is just a smoke screen to make people think that they are doing something.

More posturing by the uk. Only an idiot would suggest the uk could influence global tax policy. Either it happens at OECD or it doesn’t happen. If anyone move unilaterally it turns into a sh*tshow and they lose out in medium term. Uk he the triple whammy of brexit, Covid and changed US administration to deal with. I also believe digital tax is covered under Pilar 1 of the proposed oecd tax reforms.

Timing belt

PropQueries wrote: »

You're joking right? Fire regulations have added e.g. c. €300k to the cost of building each and every apartment in a block of say 100 apartments?

I wouldn't be looking at London. I would be looking at the UK's provincial towns to arrive at more realistic costs to building apartments IMO

No it's not all Fire regulation but if you look at the properties that SF property developer McFeely’s brought to the market ignoring Fire regulation certainly cut costs in developing them.

Why would I look at a UK Provincial town and not London's development costs.... Are you not the one that has been saying that it costs the same to build in Waterford as it does in Dublin

Timing belt

Hubertj wrote: »

More posturing by the uk. Only an idiot would suggest the uk could influence global tax policy. Either it happens at OECD or it doesn’t happen. If anyone move unilaterally it turns into a sh*tshow and they lose out in medium term. Uk he the triple whammy of brexit, Covid and changed US administration to deal with. I also believe digital tax is covered under Pilar 1 of the proposed oecd tax reforms.

Correct with some countries refusing to sign up unless changes are made to pillar 2

PropQueries

Hubertj wrote: »

More posturing by the uk. Only an idiot would suggest the uk could influence global tax policy. Either it happens at OECD or it doesn’t happen. If anyone move unilaterally it turns into a sh*tshow and they lose out in medium term. Uk he the triple whammy of brexit, Covid and changed US administration to deal with. I also believe digital tax is covered under Pilar 1 of the proposed oecd tax reforms.

Well in 2019, the BBC reported:

"France passes tax on tech giants despite US threats"

These upcoming OECD global tax reforms need to appease the UK, France etc. and the United States, but especially the many EU countries who have their legislation ready to go to tax the multinationals if they don't like the end agreement IMO

Link to BBC article here: https://www.bbc.com/news/world-europe-48947922

Timing belt

PropQueries wrote: »

Well in 2019, the BBC reported:

"France passes tax on tech giants despite US threats"

These upcoming OECD global tax reforms need to appease the UK, France etc. and the United States, but especially the many EU countries who have their legislation ready to go to tax the multinationals if they don't like the end agreement IMO

Link to BBC article here: https://www.bbc.com/news/world-europe-48947922

Bring on the Trade wars if they do....

PropQueries

Timing belt wrote: »

No it's not all Fire regulation but if you look at the properties that SF property developer McFeely’s brought to the market ignoring Fire regulation certainly cut costs in developing them.

Why would I look at a UK Provincial town and not London's development costs.... Are you not the one that has been saying that it costs the same to build in Waterford as it does in Dublin

I would actually compare Waterford to Dublin more than I would compare Dublin to London

Timing belt

PropQueries wrote: »

I would actually compare Waterford to Dublin more than I would compare Dublin to London

your argument was that costs should be the same with the exception of land..

I would expect Dublin to be more expensive that London in building mid to high rise apartments (excluding land) because London have been doing it longer and will be more efficient at it but neither the less it does give you something to compare and benchmark against.

Hubertj

https://www.myhome.ie/residential/brochure/nedanone-castlecove-kerry/4401120

How would you go about getting this evaluated? First step to get a building contractor and or engineer to evaluate work done to date then estimate costs to finish it? I presume contractors could be reluctant to take on a half finished job due to uncertainty about quality of work carried out by someone else?

Cyrus

PropQueries wrote: »

I would actually compare Waterford to Dublin more than I would compare Dublin to London

Why?

PropQueries

Timing belt wrote: »

your argument was that costs should be the same with the exception of land..

I would expect Dublin to be more expensive that London in building mid to high rise apartments (excluding land) because London have been doing it longer and will be more efficient at it but neither the less it does give you something to compare and benchmark against.

Yes, between different towns in Ireland, not between Dublin and London

The costs of building a house in Dublin is much the same as the cost of building a house in Co. Waterford compared to Dublin when land costs are removed from the equation IMO

London has a completely different dynamic and cost base. You can't put a shovel in the ground in London without hitting something of historical importance and they have much more complex and rigid building regulations etc.

In Dublin there's nothing but empty fields so that doesn't really apply, southside or northside IMO

There's absolutely no reason why new build a-rated 2 bed terraced houses in e.g. Swords, should cost more (maybe 10% max) than the new build a-rated 2 bed terraced houses that a developer was selling in Co. Waterford last year for c. €160k IMO

Timing belt

PropQueries wrote: »

Yes, between different towns in Ireland, not between Dublin and London

The costs of building a house in Dublin is much the same as the cost of building a house in Co. Waterford compared to Dublin when land costs are removed from the equation IMO

London has a completely different dynamic and cost base. You can't put a shovel in the ground in London without hitting something of historical importance and they have much more complex and rigid building regulations etc.

In Dublin there's nothing but empty fields so that doesn't really apply, southside or northside IMO

There's absolutely no reason why new build a-rated 2 bed terraced houses in e.g. Swords, should cost more (maybe 10% max) than the new build a-rated 2 bed terraced houses that a developer was selling in Co. Waterford last year for c. €160k IMO

We were talking about mid to high rise apartments so they will more than likely be city centre based so empty fields don't enter the equation... and I am sure that you will have the same issues in Dublin as London with regards to historical finds.

Do you really think the UK building regs are more strict than Ireland? Maybe in the past but I don't think that will be the case anymore. And if your logic is correct then the cost of an apartment block in London will be the same as Bristol or any regional city once you exclude the land.

Timing belt

Hubertj wrote: »

https://www.myhome.ie/residential/brochure/nedanone-castlecove-kerry/4401120

How would you go about getting this evaluated? First step to get a building contractor and or engineer to evaluate work done to date then estimate costs to finish it? I presume contractors could be reluctant to take on a half finished job due to uncertainty about quality of work carried out by someone else?

The first thing I would do is to find out the real history of the property to make sure that there was no dispute behind it that would result in local tradesmen not wanting to work on it. From the photo's its hard to tell but it does look as if it is only internal work and that it is sealed from the weather.

PropQueries

Timing belt wrote: »

We were talking about mid to high rise apartments so they will more than likely be city centre based so empty fields don't enter the equation... and I am sure that you will have the same issues in Dublin as London with regards to historical finds.

Do you really think the UK building regs are more strict than Ireland? Maybe in the past but I don't think that will be the case anymore. And if your logic is correct then the cost of an apartment block in London will be the same as Bristol or any regional city once you exclude the land.

Dublin doesn’t even come close to London on building regulations. There is a very good article on the economist with the sub-heading: “Why building in the world’s most popular city is so difficult and expensive”.

“Yet building offices (and homes) near the middle of the capital is shockingly expensive. Even before the cost of land is considered, it costs roughly a fifth more than erecting similar stuff in New York or Hong Kong, according to Turner and Townsend, a consultancy firm.”

“The planning system then adds all sorts of expensive complexities. In Westminster more than 75% of land is covered by 56 conservation areas protecting the historic appearances of streets, right down to the colour of paint on doors.”

“Taller buildings are trickier still. They must not block designated views of various landmarks, which explains why some of the skyscrapers in the City of London are oddly shaped”

It goes on to say in relation to your query on whether it costs more to build in Bristol than London:

“Putting up buildings is far quicker and easier in other cities, such as Birmingham and Manchester, and also in London suburbs such as Croydon. But developers persist with inner London anyway.”

There are many other reasons detailed in the article and well worth a read IMO:

Link to article in The Economist here: https://www.economist.com/britain/2014/08/09/bodies-bombs-and-bureaucracy

Hubertj

Timing belt wrote: »

The first thing I would do is to find out the real history of the property to make sure that there was no dispute behind it that would result in local tradesmen not wanting to work on it. From the photo's its hard to tell but it does look as if it is only internal work and that it is sealed from the weather.

Thanks, I never thought about possible local disputes related to the property. Only day dreaming at this stage anyway. Not like Kerry is 5 poxy km from my gaff

Timing belt

Hubertj wrote: »

Thanks, I never thought about possible local disputes related to the property. Only day dreaming at this stage anyway. Not like Kerry is 5 poxy km from my gaff

Lovely part of the world but a long commute from there to Dublin (5 hours) or Cork (2 hours). The other thing that would be priority is if the house has a landline, water, electricity etc... as it may problematic depending on how far away the network is.

The thing with big houses in the country side like that is that a lot of times a newly married couple start building and then they split up and no-one in the community wants to take sides so trademen stay away and won't undertake work... You don't want to be the Yank coming in to buy at public auction like in the Field....

https://www.daft.ie/for-sale/detached-house-nedanone-castlecove-co-kerry/1477106

For sale on daft @ 200k (40k cheaper)

Hubertj

Timing belt wrote: »

Lovely part of the world but a long commute from there to Dublin (5 hours) or Cork (2 hours). The other thing that would be priority is if the house has a landline, water, electricity etc... as it may problematic depending on how far away the network is.

The thing with big houses in the country side like that is that a lot of times a newly married couple start building and then they split up and no-one in the community wants to take sides so trademen stay away and won't undertake work... You don't want to be the Yank coming in to buy at public auction like in the Field....

https://www.daft.ie/for-sale/detached-house-nedanone-castlecove-co-kerry/1477106

For sale on daft @ 200k (40k cheaper)

Lovely part of the world, last 2 summer holidays in that area. Am thinking holiday home and not full time resident. I’m not 1 of the millions of people that have left or will leave Dublin due to COVID.
Never considered looking at daft. Interesting the price differential. Nice 1.

Timing belt

Hubertj wrote: »

Lovely part of the world, last 2 summer holidays in that area. Am thinking holiday home and not full time resident. I’m not 1 of the millions of people that have left or will leave Dublin due to COVID.
Never considered looking at daft. Interesting the price differential. Nice 1.

This is the street view of the property
https://www.google.com/maps/@51.7738594,-10.0127054,3a,60y,351.69h,79.86t/data=!3m6!1e1!3m4!1shtr6DchTeS9Z82xNT7cEHQ!2e0!7i16384!8i8192

From the photo it was up for sale with a DNG Auctioner but it is no longer listed so might be on the market for a while

There is this one for sale down the road for 92k

https://www.daft.ie/for-sale/detached-house-baslickane-waterville-co-kerry/2937701

cnocbui

Hubertj wrote: »

https://www.myhome.ie/residential/brochure/nedanone-castlecove-kerry/4401120

How would you go about getting this evaluated? First step to get a building contractor and or engineer to evaluate work done to date then estimate costs to finish it? I presume contractors could be reluctant to take on a half finished job due to uncertainty about quality of work carried out by someone else?

It misses out on fibre to the home by a short distance, maybe they moved to get that. My house was close to that level of finish when I bought it. The most important thing is check for a water supply. You don't want to find they drilled and came up dry.

Timing belt

Interesting to see that Hibernia Reit are looking to get land in Newlands cross rezoned from agricultural land so they can build 3,500 houses.

https://www.echo.ie/news/article/newlands-farm-over-3-500-residential-units-planned-for-hibernia-site

Its hard to believe that this land is sitting there and already has full services and yet the government can't build affordable houses

Hibernia hopes the site will be rezoned for residential development in the next South Dublin County Development Plan, for the period 2022-2028, which is currently under review.

The spokesperson added: “Unlike many other proposed sites for development, it is already fully serviced for water, power and data, thus reducing the timeline for delivery.”

The IRFU are in for a nice bonus if the do manage to get it rezoned

https://www.irishtimes.com/business/commercial-property/hibernia-acquires-92-acres-at-newlands-cross-from-irfu-1.3694888

stampydmonkey

Timing belt wrote: »

https://www.echo.ie/news/article/newlands-farm-over-3-500-residential-units-planned-for-hibernia-site

"60 per cent saw the development of more homes and apartments to rent, rather than buy, as being a priority."

60% of who....developers?

Timing belt

stampydmonkey wrote: »

"60 per cent saw the development of more homes and apartments to rent, rather than buy, as being a priority."

60% of who....developers?

"A survey of local residents was carried out by the market research company Behaviour and Attitudes last year, on behalf of Hibernia, and the findings of the survey have informed Hibernia’s plans.

Their survey found that 53 per cent of respondents were in favour of new homes, 43 per cent were in favour of more rental accommodation, and 60 per cent saw the development of more homes and apartments to rent, rather than buy, as being a priority."

Villa05

Timing belt wrote:

It might have something to do with complying with fire regulations and not just throwing up any type of building like they did previously. It would be interesting to see how Dublin compares with London in costs of building mid to high rise apartments.

I'm sure houses have to comply with fire regulations also.

Is there a precedent anywhere else in the world where apartments cost more to build than houses?

I can't see any other reason than this being a con job by the industry on the state, all state assisted of course through government policy.

HansKroenke

Timing belt wrote: »

Interesting to see that Hibernia Reit are looking to get land in Newlands cross rezoned from agricultural land so they can build 3,500 houses.

https://www.echo.ie/news/article/newlands-farm-over-3-500-residential-units-planned-for-hibernia-site

Its hard to believe that this land is sitting there and already has full services and yet the government can't build affordable houses


The IRFU are in for a nice bonus if the do manage to get it rezoned

https://www.irishtimes.com/business/commercial-property/hibernia-acquires-92-acres-at-newlands-cross-from-irfu-1.3694888

Interesting as Hibernia is primarily a commercial REIT with only 11% residential assets in its portfolio. With demand being significant for homes among the population and a pro-investor government, this is an area where we will see a lot more growth and increased supply.

Villa05

Timing belt wrote:

You have a bee in your bonnet about Reits and Tax.... The reason they are not taxed is to stop investors from being taxed twice on the investment. Would you be happier if the Reit's paid the tax and the investors didn't pay tax.

The taxpayer provides essential services to these buildings like water, waste, transport services and infrastructure. Without these services the properties are worthless, its not unreasonable for business that benefit from these services and provision/maintenence of infrastructure to make a contribution to their cost like every other citizen

Hubertj

Villa05 wrote: »

I'm sure houses have to comply with fire regulations also.

Is there a precedent anywhere else in the world where apartments cost more to build than houses?

I can't see any other reason than this being a con job by the industry on the state, all state assisted of course through government policy.

All part of the conspiracy.

https://propertydata.co.uk/construction-costs

fliball123

schmittel wrote: »

15 years ago we thought 10 times average wage was the sign of a boom, now we seem have normalised it!

average Irish house price
https://www.newstalk.com/news/average-house-price-in-ireland-increased-by-almost-e20000-this-year-1124268#:~:text=Average%20house%20price%20in%20Ireland%20increased%20by%20almost%20%E2%82%AC20%2C000%20this%20year,-Marita%20Moloney&text=The%20average%20listed%20price%20of,price%20nationwide%20was%20%E2%82%AC269%2C522.

average house price = 269,522

Average wage
https://www.irishtimes.com/business/economy/average-full-time-salary-in-republic-nearly-49-000-1.4289348#:~:text=The%20latest%20figures%20show%20average,increase%20of%203.7%20per%20cent).

Average wage full time salary = 49000

Even at the median salary 36k (with part time workers included )


how is this 10 times the average wage??

10 x 36 = 360k ?
10 x 49 = 490k?
Average house price just under 270k?

Can we stop with the hyperbole ?

fliball123

schmittel wrote: »

There are those on here claiming property is currently affordable which is bonkers. That is who I am referring to.

Yes there some 15 years ago saying property at over 10 times the national wage was perfectly normal, and that people should stop cribbing and moaning from the sidelines. Look how well that turned out.

So all property for all people is unavoidable?? can you quantify/prove this ??

fliball123

PropQueries wrote: »

The only reason they’re currently getting the rents they are is because of long-term lease agreements with the council or HAP.

Once the state pulls in the purse strings, rents collapse.

The lease agreements the current funds have signed up for are most likely watertight but any developer who doesn’t sign up within the next 6 months will be extremely disappointed IMO

You do realise a lot of these rental agreements are fixed for 20 to 25 years. It might be some time before they can pull the purse strings closed on these?

fliball123

PropQueries wrote: »

Market rents will collapse. The long-term lease agreements already entered into will be paid by the taxpayer through higher taxes and less local services for many years e.g. citizens shouldn’t be expecting that ambulance to arrive on time etc.

But, after c. 6 months, Paschal will pull in the purse strings and there will (should) be no more such ridiculous agreements signed.

Once the state exits the market, landlords will be left fighting over the very few tenants actually seeking rental accommodation IMO

When did Pascal tell you this or are you looking at your crystal ball again?

Villa05

fliball123 wrote:

Average wage full time salary = 49000

Do you know if the figure includes bonus and overtime payments?