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

Timing belt

schmittel wrote: »

As i understand it if profits rise intemationally from IP that apple holds in Ireland they must increase their workforce in Ireland in proportion. Its part of the deal.

I think there is a decent chance that the dedicated tax teams are simply complying with the current tax laws than planning for the future.

Apple has been manufacturing in Cork for 40 years and employees over 6000 people. They are all not employed just to avoid tax as you are suggesting with your post.

Hubertj

schmittel wrote: »

As i understand it if profits rise intemationally from IP that apple holds in Ireland they must increase their workforce in Ireland in proportion. Its part of the deal.

I think there is a decent chance that the dedicated tax teams are simply complying with the current tax laws than planning for the future.

I suppose you could think that way if you’re a conspiracy theorist. It could be that Apple is preparing to expand operations in Ireland. That is positive for commercial property in cork, which is relevant to the 2021 property market.

hold my beer

schmittel wrote: »

As i understand it if profits rise intemationally from IP that apple holds in Ireland they must increase their workforce in Ireland in proportion. Its part of the deal.

I think there is a decent chance that the dedicated tax teams are simply complying with the current tax laws than planning for the future.

Part of what deal.

ReturnOfThe

As I see it, the housing market is driven by a number of variables which tend to apply upward or downward pressure on prices.

Variables which pull house prices in the same direction.
Economic Outlook.
Population Growth.
Demand (Speculative in times of low interest, non-speculative in times of low supply).
Mortgage Approvals.

Variables which push house prices in the opposite direction.
Supply.
Interest Rates.

So if someone is looking for house prices to fall, they would have to be looking out for at least one of the below headlines in the papers..

Economic outlook deteriorating
Population growth being reversed
Demand falling
Mortgage approvals falling
Supply increasing and outpacing demand
Interest rates rising

I think most people will agree that none of the above look remotely like happening in the short to medium term except maybe for the last one and I'm beginning to think that maybe it would be a good thing at this stage as I think that low interest rates contributes (perversely) to rising house prices.

PropQueries

New data (released today), shows that more than 80,000 households are in state-supported private rented accommodation and that the Hap scheme payments to landlords will rise from €436 million last year to in excess of €1 billion by the end of 2021 (this year).

So, it's HAP alone is going to rise from €436m last year to over €1billion this year, and that's from the department of housing very own figures.

So, is the state expecting the number of households receiving HAP to double from 80,000 households to 160,000 households this year or are they expecting rents to double or something in between?

Link to article in Sunday Business Post here:https://www.businesspost.ie/houses/more-than-80000-households-are-in-state-supported-private-rented-accommodation-af10bd9b

Timing belt

ReturnOfThe wrote: »

As I see it, the housing market is driven by a number of variables which tend to apply upward or downward pressure on prices.

Variables which pull house prices in the same direction.
Economic Outlook.
Population Growth.
Demand (Speculative in times of low interest, non-speculative in times of low supply).
Mortgage Approvals.

Variables which push house prices in the opposite direction.
Supply.
Interest Rates.

So if someone is looking for house prices to fall, they would have to be looking out for at least one of the below headlines in the papers..

Economic outlook deteriorating
Population growth being reversed
Demand falling
Mortgage approvals falling
Supply increasing and outpacing demand
Interest rates rising

I think most people will agree that none of the above look remotely like happening in the short to medium term except maybe for the last one and I'm beginning to think that maybe it would be a good thing at this stage as I think that low interest rates contributes (perversely) to rising house prices.

I wouldn't go so far as to say that the economic outlook won't deteriorate.

There are also lots of other considerations that you need to included such as rent, Institutional investors appetite, Government intervention etc...

PropQueries

ReturnOfThe wrote: »

So if someone is looking for house prices to fall, they would have to be looking out for at least one of the below headlines in the papers..

Economic outlook deteriorating
Population growth being reversed
Demand falling
Mortgage approvals falling
Supply increasing and outpacing demand
Interest rates rising

I'm calling it

Every single one of those boxes will be ticked by August 2021.

thefridge2006

PropQueries wrote: »

Also in other news. According to the Irish Times today:

"EU poised to affirm tax on tech giants if global agreement fails. Leaders are working towards consensus, but EU ready to take unilateral action if needed.

European Union leaders are poised to affirm their commitment to a unilateral tax on tech giants if they fail to agree on a global framework with partners, including Joe Biden’s US administration, by the middle of this year."

There's so many fires we have to fight this year, it will take a significant luck of the Irish to come out the other side with a quick return to an economy that looks anything like 2019 IMO

There may also be a quick reversal of any approved or soon to be approved housing measures (which appear to be primarily on the demand side of the equation) if the government finances do take an abrupt turn IMO

Link to Irish Times article here: https://www.irishtimes.com/business/economy/eu-poised-to-affirm-tax-on-tech-giants-if-global-agreement-fails-1.4505268

100% it's ridiculous looking on from the side lines

HansKroenke

PropQueries wrote: »

New data (released today), shows that more than 80,000 households are in state-supported private rented accommodation and that the Hap scheme payments to landlords will rise from €436 million last year to in excess of €1 billion by the end of 2021 (this year).

So, it's HAP alone is going to rise from €436m last year to over €1billion this year, and that's from the department of housing very own figures.

So, is the state expecting the number of households receiving HAP to double from 80,000 households to 160,000 households this year or are they expecting rents to double or something in between?

Link to article in Sunday Business Post here:https://www.businesspost.ie/houses/more-than-80000-households-are-in-state-supported-private-rented-accommodation-af10bd9b

Increased property taxes will help pay for HAP, it will be grand.

PropQueries

HansKroenke wrote: »

Increased property taxes will help pay for HAP, it will be grand.

I’m surprised that the share price of Ires REIT didn’t quadruple this afternoon on that news

enricoh

PropQueries wrote: »

New data (released today), shows that more than 80,000 households are in state-supported private rented accommodation and that the Hap scheme payments to landlords will rise from €436 million last year to in excess of €1 billion by the end of 2021 (this year).

So, it's HAP alone is going to rise from €436m last year to over €1billion this year, and that's from the department of housing very own figures.

So, is the state expecting the number of households receiving HAP to double from 80,000 households to 160,000 households this year or are they expecting rents to double or something in between?

Link to article in Sunday Business Post here:https://www.businesspost.ie/houses/more-than-80000-households-are-in-state-supported-private-rented-accommodation-af10bd9b

There's a lot of people in hospitality etc that are getting a taste of our welfare state for the first time. I reckon employers will struggle to get minimum wage workers to go back to work, especially now with rents rising in the cheaper counties.

combat14

HansKroenke wrote: »

Increased property taxes will help pay for HAP, it will be grand.

HAP needs to be scrapped to bring down rent price bubble

Hubertj

https://voxeu.org/article/worldwide-building-height-gaps-their-determinants-and-their-implications#.YEd29DdPkGc.mailto

I found this very interesting. An analysis of not building up and impact it can have on cities as well as prices and affordability. Ireland top of list for not building up. It really needs to be done, and done properly, in the right places in our cities. Would be interesting to understand the cost base for different height buildings and at what height cost benefit can factor into more affordable units.

Worth a read as a lot more interesting than scrolling through pages of conspiracy theory, made up facts and misrepresented articles.

Pelezico

Interesting Central Bank questioning at Oirechtas hearing today.


Circa 17000 people not paying mortgage due to covid. Seems like a lot of defaulters. How can they kickstart their microeconomies?

MacronvFrugals

Hubertj wrote: »

https://voxeu.org/article/worldwide-building-height-gaps-their-determinants-and-their-implications#.YEd29DdPkGc.mailto

I found this very interesting. An analysis of not building up and impact it can have on cities as well as prices and affordability. Ireland top of list for not building up. It really needs to be done, and done properly, in the right places in our cities. Would be interesting to understand the cost base for different height buildings and at what height cost benefit can factor into more affordable units.

Worth a read as a lot more interesting than scrolling through pages of conspiracy theory, made up facts and misrepresented articles.

As mentioned recently by Lorcan Sirr from TUD

The EU average for apartment stock in urban areas is 40% Dublin is currently 35.8% he reckons it’s completely a developer myth talking about height.

Cyrus

schmittel wrote: »

As i understand it if profits rise intemationally from IP that apple holds in Ireland they must increase their workforce in Ireland in proportion. Its part of the deal.

I think there is a decent chance that the dedicated tax teams are simply complying with the current tax laws than planning for the future.

As I understand it Apple holds its IP in the US. And anyone that was holding IP here has also moved it back.

PropQueries

MacronvFrugals wrote: »

As mentioned recently by Lorcan Sirr from TUD

The EU average for apartment stock in urban areas is 40% Dublin is currently 35.8% he reckons it’s completely a developer myth talking about height.

So we’re not far off the EU average? And the primary reason for apartments in many EU countries was a little thing that happened between 1939 and 1945 and afterwards they were required to house a lot of people quickly.

Subutai

MacronvFrugals wrote: »

As mentioned recently by Lorcan Sirr from TUD

The EU average for apartment stock in urban areas is 40% Dublin is currently 35.8% he reckons it’s completely a developer myth talking about height.

Apartment stock here and in other European capitals are very different. A lot of the "Dublin is very dense actually" and "there are loads of apartments" arguments depend on people being piled in to little more than alum accommodation in the likes of Mountjoy square.

The arguments are usually made by ivory Tower academics like Orla Hegarty and Lorcan Sirr who are also, ironically, against co-living. Co-living is modern tenements you see, and we don't currently have modern tenements packed to the gills with precarious workers all over the city.

Hubertj

MacronvFrugals wrote: »

As mentioned recently by Lorcan Sirr from TUD

The EU average for apartment stock in urban areas is 40% Dublin is currently 35.8% he reckons it’s completely a developer myth talking about height.

Sorry I don’t follow what you mean. Is Lorcan sirr saying building up isn’t the answer - is there a paper on it or anything as I’d be interested to read differing viewpoints on it. What about other factors such as urban sprawl vs more dense hosing supported by appropriate infrastructure?

PropQueries

MacronvFrugals wrote: »

As mentioned recently by Lorcan Sirr from TUD

The EU average for apartment stock in urban areas is 40% Dublin is currently 35.8% he reckons it’s completely a developer myth talking about height.

Actually a very interesting comment. Haven’t really questioned that narrative that has been put out about how we have a low level of apartments compared to continental Europe. Always assumed it was true.

But looking at some sources online and checked the Netherlands given that it’s one of the most densely populated countries in Europe and the housing type statistics are eye opening, to me anyway:

18% detached
58% semi-detached
20% flats

That’s amazing to me as the Netherlands is only about half the size of ireland and has 17 million people.

Link here: https://www.statista.com/statistics/536536/distribution-of-the-population-in-the-netherlands-by-dwelling-type/

Subutai

PropQueries wrote: »

Actually a very interesting comment. Haven’t really questioned that narrative that has been put out about how we have a low level of apartments compared to continental Europe. Always assumed it was true.

But looking at some sources online and checked the Netherlands given that it’s one of the most densely populated countries in Europe and the housing type statistics are eye opening, to me anyway:

18% detached
58% semi-detached
20% flats

That’s amazing to me as the Netherlands is only about half the size of ireland and has 17 million people.

Link here: https://www.statista.com/statistics/536536/distribution-of-the-population-in-the-netherlands-by-dwelling-type/

The settlement pattern in the Netherlands is very different, and so is the density pattern. They do not, unlike Ireland, have a primate city. They have a lot of large urban areas none of which are overwhelmingly dominant.

They have 25 cities more populous than Limerick (Ireland's third largest city) but no city as populous as Dublin.

If you've a lot of people living in small and mid sized cities then the kind of suburban settlement pattern characterised by mid-rise and semi Ds is sustainable and doesn't lead to sprawl. If you have really only one large city, overwhelmingly dominant economically, then that same settlement pattern will lead to major sprawl and serious transport problems.

PropQueries

Subutai wrote: »

The settlement pattern in the Netherlands is very different, and so is the density pattern. They do not, unlike Ireland, have a primate city. They have a lot of large urban areas none of which are overwhelmingly dominant.

They have 25 cities more populous than Limerick (Ireland's third largest city) but no city as populous as Dublin.

If you've a lot of people living in small and mid sized cities then the kind of suburban settlement pattern characterised by mid-rise and semi Ds is sustainable and doesn't lead to sprawl. If you have really only one large city, overwhelmingly dominant economically, then that same settlement pattern will lead to major sprawl and serious transport problems.

Thanks.

Came across this analysis on eurostat, which gives a nice breakdown summary by EU country:

“In 2018, 46.0 % of people in the EU-27 lived in flats, close to one fifth (18.6 %) in semi-detached houses and over one third (34.7 %) in detached houses.

Among the EU Member States, the proportion of people living in flats in 2018 was at least 60.0 % in Latvia (66.2 %), Spain (64.9 %), Estonia (61.5 %) and Greece (60.6 %), and just below this level in Lithuania (59.5 %); a similarly high proportion of people also lived in flats in Switzerland (62.5 %). The share of people living in detached houses was highest among the EU Member States in Croatia (69.7 %), Slovenia (66.2 %), Romania (65.2 %) and Hungary (64.6 %); Denmark and Poland were the only other Member States where a majority of the population lived in a detached house. North Macedonia (74.6 %), Serbia (63.6 %) and Norway (57.5 %) also reported that high proportions of their populations lived in detached houses. The highest proportions of people living in semi-detached houses in EU Member States were reported in the Netherlands (58.0 %), Ireland (52.1 %), Malta (41.5 %) and Belgium (40.6 %). These were the only Member States where two fifths or more of the population lived in semi-detached houses. In the United Kingdom this share was even higher, reaching 60.8 %.”

First time I’ve looked into this and genuinely surprised that the narrative around our low level of apartments compared to the EU is near enough nonsense and does appear like a developer led narrative at this stage.

But your reasoning on Holland makes sense.

But in relation to some eastern EU, I would assume their higher apartment living is more due to cold war Soviet housing policy.

Edit: I take my last paragraph about Soviet policy back. Even that’s wrong.

We really don’t need any more apartments from looking at the above from eurostat. It’s insane how many of us (mainly me?) actually fell for this nonsense.

I’m genuinely shocked.

awec

I think the narrative about needing more apartments has been from the angle that apartments make more efficient use of expensive city land and let you house a great number of people due to higher densities.

It ignores the fact that people here have little to no interest of living in an apartment once they have a family.

Subutai

Talk to someone who's lived in apartments in somewhere like Germany and here. My European colleagues have frequently been shocked at what we call apartments.

I've no doubt there are lots of people living in apartments - Dublin is full of old buildings sub divided into apartments and packed as high as possible. That's not a sustainable way to live for small households, which is what the drive for more apartments is meant to accommodate.

awec

Subutai wrote: »

Talk to someone who's lived in apartments in somewhere like Germany and here. My European colleagues have frequently been shocked at what we call apartments.

I've no doubt there are lots of people living in apartments - Dublin is full of old buildings sub divided into apartments and packed as high as possible. That's not a sustainable way to live for small households, which is what the drive for more apartments is meant to accommodate.

Apartments here are not designed for families. Even purpose built apartment buildings are not designed for families.

There is generally no storage whatsoever. If you are really lucky you get a cupboard to store a few small items. But there is nowhere to keep the christmas decorations when not being used, suitcases, the child's pram, bicycles, golf clubs etc.

I guess you could say that people don't live in apartments here because apartments aren't designed for family life. Or you could say that apartments aren't designed for family life because families just don't want to live in apartments here. Who knows.

PropQueries

awec wrote: »

I think the narrative about needing more apartments has been from the angle that apartments make more efficient use of expensive city land and let you house a great number of people due to higher densities.

It ignores the fact that people here have little to no interest of living in an apartment once they have a family.

But, then we’re back to the nonsense that land is expensive in Dublin because it’s a “city” and there’s not much of it. We’re not London or Tokyo. There’s nothing but land in and around the city. Actually, there’s plenty of land around london. Not sure about Tokyo, but probably plenty of land there as well though.

That makes the “efficient land use” narrative also developer led IMO

awec

PropQueries wrote: »

But, then we’re back to the nonsense that land is expensive in Dublin because it’s a “city” and there’s not much of it. We’re not London or Tokyo. There’s nothing but land in and around the city. Actually, there’s plenty of land around london. Not sure about Tokyo, but probably plenty of land there as well though.

That makes the “efficient land use” narrative also developer led IMO

Land is expensive in Dublin because it's the most sought after land in the country. Not all land is equal. Even in Dublin, or around it, not all land is equal.

It's the Midleton Very Rare of land.

If you have land in Dublin zoned for housing you'd have no bother getting rid of it. I have no source to back this up so please forgive me, but I believe a significant chunk of the land around Dublin is not zoned for housing but rather is agricultural.

PropQueries

awec wrote: »

Land is expensive in Dublin because it's the most sought after land in the country. Not all land is equal. Even in Dublin, or around it, not all land is equal.

It's the Midleton Very Rare of land.

If you have land in Dublin zoned for housing you'd have no bother getting rid of it. I have no source to back this up so please forgive me, but I believe a significant chunk of the land around Dublin is not zoned for housing but rather is agricultural.

That’s a good point and gets to the crux of the issue.

They don’t appear to zone land based on local demand, which such be the primary and probably only reason for re-zoning land.

They have no problem re-zoning farm land all over Co. Kildare and Co. Meath but appear to have no interest in re-zoning land nearer the city even though the people who will live in all those new built houses in Co. Kildare, Co. Meath etc. will most likely be working in and commuting to Dublin.

Timing belt

awec wrote: »

Land is expensive in Dublin because it's the most sought after land in the country. Not all land is equal. Even in Dublin, or around it, not all land is equal.

It's the Midleton Very Rare of land.

If you have land in Dublin zoned for housing you'd have no bother getting rid of it. I have no source to back this up so please forgive me, but I believe a significant chunk of the land around Dublin is not zoned for housing but rather is agricultural.

Every 5/6 years the city planners rezone extra land for residential to meet the housing needs for that period in their Development Plan.



Source https://www.corkcity.ie/en/media-folder/cork-city-development-plan/process-overview.pdf

South Dublin County next Development Plan is for the period 2022-2028 and Hibernia Reit (and the IRFU as they will get a bonus if the land is developed within 10 years after selling it to the REIT) are hoping that they rezone a chunk of land by newlands cross that is already serviced for residential purposes so they can build 3,500 homes on it.

https://www.echo.ie/news/article/new...-hibernia-site

Timing belt

PropQueries wrote: »

That’s a good point and gets to the crux of the issue.

They don’t appear to zone land based on local demand, which such be the primary and probably only reason for re-zoning land.

They have no problem re-zoning farm land all over Co. Kildare and Co. Meath but appear to have no interest in re-zoning land nearer the city even though the people who will live in all those new built houses in Co. Kildare, Co. Meath etc. will most likely be working in and commuting to Dublin.

Different Councils/Corporations have different priorities and the system is so rigid it can take 8+ years to rezone. If it is not in a city development plan it won't happen for the next 6+ years.

The last plan for Dublin would have been written 2014/2015 when housing would not have been as hot a topic as now and it would appear that the city planners under estimated the housing needs.