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

fliball123

schmittel wrote: »

Maybe read what I posted and what you quoted. And around we go indeed.

sorry I should have multiquoted.

enricoh

Timing belt wrote: »

I don't even want to think about the rent the government will probably for the housing units they don't buy.

And people still think its a good use of tax payers money when they could buy twice the amount of property elsewhere.

Only thing keeping up property prices at the minute is the government imo. As for rents they've totally distorted the market.

How long can they keep spending so much dough on housing i wonder? I know they are borrowing dough for free at the minute but surely the more you borrow the riskier you are and the more you pay?

Timing belt

enricoh wrote: »

Only thing keeping up property prices at the minute is the government imo. As for rents they've totally distorted the market.

How long can they keep spending so much dough on housing i wonder? I know they are borrowing dough for free at the minute but surely the more you borrow the riskier you are and the more you pay?

The government only other option is to make people homeless and that won't be happening. So to answer your question they will continue to spend until there is adequate supply of housing and rental yields start to fall.

Hubertj

https://www.irishtimes.com/business/commercial-property/hugo-boss-signs-new-10-year-lease-on-grafton-street-store-1.4456393

24% reduction. Does this essentially set a benchmark for vacant units and lease renewals in the graft on st area?

wowy

Hubertj wrote: »

https://www.irishtimes.com/business/commercial-property/hugo-boss-signs-new-10-year-lease-on-grafton-street-store-1.4456393

24% reduction. Does this essentially set a benchmark for vacant units and lease renewals in the graft on st area?

It sets the new market rent level for the street, but I wouldn't read too much into it being a 24% reduction. The expired lease was likely a relatively long Upwards only lease, so the old rent of €825K may have been set as far back as the 2005 review.

timmyntc

AlmightyCushion wrote: »

All the people in the over 75% category are also in the over 60% category and over 50% category etc.

I get that - but if you sum across the 4 categories in over 25%, for EU28 you get more than 100% of population. The categories sound like they are mutually exclusive (tenant, owner, etc) but maybe they are not.
I could understand if it was less than 100% (expect some people to have housing burden under 25% of income) but not over 100%?

hometruths

timmyntc wrote: »

I get that - but if you sum across the 4 categories in over 25%, for EU28 you get more than 100% of population. The categories sound like they are mutually exclusive (tenant, owner, etc) but maybe they are not.
I could understand if it was less than 100% (expect some people to have housing burden under 25% of income) but not over 100%?

Figures are % of the categories rather than percentage of population.

Eg 12.7% of owners with a mortgage have burden over 25% does not equal 12.7% of the population are owners with a mortgage and burden over 25%

timmyntc

schmittel wrote: »

Figures are % of the categories rather than percentage of population.

Eg 12.7% of owners with a mortgage have burden over 25% does not equal 12.7% of the population are owners with a mortgage and burden over 25%

Really?
So ~95% of owners with loan/mortgage in this country have housing burden of less than 25%?
And ~40% of renters (at market rates) have burden of less than 25% disposable income?

Maybe things are better than I thought

hometruths

timmyntc wrote: »

Really?
So ~95% of owners with loan/mortgage in this country have housing burden of less than 25%?
And ~40% of renters (at market rates) have burden of less than 25% disposable income?

Maybe things are better than I thought

Hence all the comment on here. These stats are telling us that the vast majority of people are having no affordability issues re housing costs.

Not exactly what we hear every day from other sources.

fliball123

schmittel wrote: »

Hence all the comment on here. These stats are telling us that the vast majority of people are having no affordability issues re housing costs.

Not exactly what we hear every day from other sources.

Well to be fair if you can afford to pay something and are comfortable doing it your not going to be on complaining about it. The people who can afford it are hardly going to go out and say its ok we can afford this as it might drive prices up higher. Its the cohort that are on saying they cant afford are most vocal and leads to the notion that everyone cant afford it.

hometruths

fliball123 wrote: »

Well to be fair if you can afford to pay something and are comfortable doing it your not going to be on complaining about it. The people who can afford it are hardly going to go out and say its ok we can afford this as it might drive prices up higher. Its the cohort that are on saying they cant afford are most vocal and leads to the notion that everyone cant afford it.

Sure that makes sense, but essentially you are saying we don't actually have an affordability problem, the whole thing is being blown out of a proportion by a minority of loud poor people!

I am quite skeptical about the true extent of our "housing crisis" but not even I'm that cynical!

MacronvFrugals

Does anyone know if we've got updated Eurostat figures like the ones mentioned in this article?

Jump in young Irish adults living with parents among highest in EU

"Rate of people aged 25-29 living at home up 11.2 points to 47.2% in decade to 2017"

https://www.irishtimes.com/news/social-affairs/jump-in-young-irish-adults-living-with-parents-among-highest-in-eu-1.4177848?mode=sample&auth-failed=1&pw-origin=https%3A%2F%2Fwww.irishtimes.com%2Fnews%2Fsocial-affairs%2Fjump-in-young-irish-adults-living-with-parents-among-highest-in-eu-1.4177848

fliball123

schmittel wrote: »

Sure that makes sense, but essentially you are saying we don't actually have an affordability problem, the whole thing is being blown out of a proportion by a minority of loud poor people!

I am quite skeptical about the true extent of our "housing crisis" but not even I'm that cynical!

We have a housing problem (not enough houses) and judging by the stats of income vs rent and income vs mortgage ratios as well as savings ratios in the country that another poster put up it would suggest that at the current price levels we have not got an affordability problem. Are there areas in the country that the majority can not afford. Yes there are. Is this the same every other country in the world. Yes it is. Also when you do a comparison with the average and the median wage and the average house price it shows that housing is affordable

Bass Reeves

fliball123 wrote: »

We have a housing problem (not enough houses) and judging by the stats of income vs rent and income vs mortgage ratios as well as savings ratios in the country that another poster put up it would suggest that at the current price levels we have not got an affordability problem. Are there areas in the country that the majority can not afford. Yes there are. Is this the same every other country in the world. Yes it is. Also when you do a comparison with the average and the median wage and the average house price it shows that housing is affordable

I agree. The issue is how to up supply. In theory there may be a high vacency rate but what is the state of this supply. Government is caught with a sort of Hobson's choice. Direct build itself using building contractors. However this will leave us back to the 60's-80's which saw us build the Moyross'es, Knocknaheen'ies and Ballymun's of this world. There was one attempt before Christmas but Dublin city councillors knocked down a mix d development. Even small scale development's will turn into a getto in a area.

Everybody looking at affordability looks at first day entry costs. The reason Ireland has lower housing costs long-term is the that while a hug portion of income goes on repayments first day this shrinks over time. A couple using 35% of income on repayments when buying is only paying maybe 26% of disposable income at year 10 assuming an average 3% pay rise per year over them 10years. Using the same assumptions at year 20 it 19%. usually after year 25 or 30at the latest the house is paid off.

In the same time scale a person renting is more than likely seeing rental costs rise and these continue through out life if you follow the general European model

hometruths

fliball123 wrote: »

We have a housing problem (not enough houses) and judging by the stats of income vs rent and income vs mortgage ratios as well as savings ratios in the country that another poster put up it would suggest that at the current price levels we have not got an affordability problem. Are there areas in the country that the majority can not afford. Yes there are. Is this the same every other country in the world. Yes it is. Also when you do a comparison with the average and the median wage and the average house price it shows that housing is affordable

Not enough houses? Really?!

70% of people live in houses that are too big for their needs. Twice the EU Average.

Only 3.2pc of the Irish population were classified as living in overcrowded households in 2019 - the EU average is 17.2%

Our vacancy rates are above the normal rates. In some parts of Dublin they are double.

On top of that our affordability rank is below the EU average. We spend 15.7% of our disposable income on housing, the EU average is 20%.

So we currently have:

Very large % of people living in houses that are underoccupied.
Tiny % of people living in houses that are overcrowded.
A very large number of empty houses.
Extremely affordable housing.

Yet people say we don't have enough houses?!

Can somebody please explain this to me?!

Browney7

timmyntc wrote: »

Really?
So ~95% of owners with loan/mortgage in this country have housing burden of less than 25%?
And ~40% of renters (at market rates) have burden of less than 25% disposable income?

Maybe things are better than I thought

Some of this will be a function of the central bank mortgage limits limiting initial borrowing and the lower interest rates on offer at present.

Take a couple earning 42.5k each. Looking at tax calculators the net income would be approx 66k. This couple could get a 297,500 mortgage and let's say they have a 32.5k deposit. They can buy a property worth 330k.

Their housing cost assuming no capital repayment and a mortgage interest rate of 2.5% equals c. 7.5k. Add on another 1500 for gas and ESB there is a housing burden of 9k (I've not fully looked at the Eurostat definition but it excludes capital repayment on mortgage). 9k/66k = housing burden of 14%.

For the same couple renting, if they rent a property worth 330k (suburban 2 bed apartment in Dublin perhaps), a rental yield of 6% equals an annual rent of 19,800 (1650 per month is probably a little cheap and more likely to be 1800 but for the example will let it as is). Add in the same ESB/Gas of 1500, their "burden" is 21300 p.a. or a % of income of c. 33%.

I expect the rent at market rates figures could be getting skewed by couples earning 6 figure salaries each in tech/finance/pharma renting in Dublin city having large incomes and then HAP potentially being classified as an income for housing recipients as well as a rental outgo (or being excluded altogether and included in other categories). As alluded to earlier, if three professionals earning 50k each are sharing a 3 bed, the household income will be high and will bring down the % burden.

PommieBast

schmittel wrote: »

On top of that our affordability rank is below the EU average. We spend 15.7% of our disposable income on housing, the EU average is 20%.

For me personally it is 50% so I find that figure highly suspect.

AdamD

schmittel wrote: »

Not enough houses? Really?!

70% of people live in houses that are too big for their needs. Twice the EU Average.

Only 3.2pc of the Irish population were classified as living in overcrowded households in 2019 - the EU average is 17.2%

Our vacancy rates are above the normal rates. In some parts of Dublin they are double.

On top of that our affordability rank is below the EU average. We spend 15.7% of our disposable income on housing, the EU average is 20%.

So we currently have:

Very large % of people living in houses that are underoccupied.
Tiny % of people living in houses that are overcrowded.
A very large number of empty houses.
Extremely affordable housing.

Yet people say we don't have enough houses?!

Can somebody please explain this to me?!

Eh???

hometruths

AdamD wrote: »

Eh???

In case you missed it: Is housing affordable?

PropQueries

In the Irish Times on the 6th January, Brendan Kenny, Deputy Chief Executive of Dublin City Council stated the following:

"We cannot build a unit in Dublin for €300,000, no way. The average cost is more than €400,000. The schemes we are building at the moment, the big ones in the city, the average costs are €430,000 per unit."

At the moment, in Castlebar, A2 rated 119sq.m. 3 bed semi-detached houses are being advertised for €243,500.

I use an A2 rated example as I think this has to be the standard going forward. There are plenty of A3 rated units currently for sale for less and much closer to Dublin.

Can anyone reconcile the difference in cost in delivering similar sized A2-rated houses in Dublin given that site costs and labour costs do not appear to make up the c. €180,000 difference in costs between Dublin and the rest of the country even if the council had to pay market rates for the sites they build on, pay market level finance costs and had to make the industry standard profit margin.

Link to Irish Times article here: https://www.irishtimes.com/news/ireland/irish-news/affordable-housing-subsidy-must-double-for-dublin-housing-chief-says-1.4451582

Link to the Castlebar A2-rated 3 bed semi-detached units for sale here: https://www.myhome.ie/residential/brochure/the-clydagh-carrabeag-newport-road-castlebar-co-mayo/4470500

Villa05

fliball123 wrote:

To say that we are paying out over 1/3rd of what we pay in taxation on welfare and this has has nothing to do with our indebtedness is just wrong. Everyone feels it on a weekly / monthly basis on their paycheck. To be exposed to losing half of every Euro earned at a rate way lower than the norm with regards to other OCED countries and lower than the AIW is the biggest factor to people working than what you are trying to spin.

You need to be careful with that SW budget total
Pensions comprise alot of it
There is also the gap between retirement age and pension age
And of course housing, you appear to be ok with money being spent on propping up rents, I feel huge savings can be made with a different approach
There is also the administration of the system which appears to be quiet costly, the universal income model does appear interesting and negates most of the admin

timmyntc wrote:

Really? So ~95% of owners with loan/mortgage in this country have housing burden of less than 25%? And ~40% of renters (at market rates) have burden of less than 25% disposable income?

Not particularly surprised with 95% figure
Affordability confined to maybe Dublin cork Galway cities
Tracker mortgages from the noughties
Lower prices plus higher deposits for 5 years that followed the crash
Salaries probably risen significantly from mortgages taken out in the 90s

However after the crash it was people entering the workforce that paid the price. Lower wages, ever increasing rents and shortage of supply.

These people are the ftbs of today

An attitude of I'm alright jack fcuk you does not really help them much. Not saying thats the intention of quoted poster

I don't think we need Excel sheets or reports to know that renting in high demand areas is expensive and challenging on low to middle incomes. Those on those incomes have no other option but to rent from the private market.

combat14

PropQueries wrote: »

In the Irish Times on the 6th January, Brendan Kenny, Deputy Chief Executive of Dublin City Council stated the following:

"We cannot build a unit in Dublin for €300,000, no way. The average cost is more than €400,000. The schemes we are building at the moment, the big ones in the city, the average costs are €430,000 per unit."

At the moment, in Castlebar, A2 rated 119sq.m. 3 bed semi-detached houses are being advertised for €243,500.

I use an A2 rated example as I think this has to be the standard going forward. There are plenty of A3 rated units currently for sale for less and much closer to Dublin.

Can anyone reconcile the difference in cost in delivering similar sized A2-rated houses in Dublin given that site costs and labour costs do not appear to make up the c. €180,000 difference in costs between Dublin and the rest of the country even if the council had to pay market rates for the sites they build on, pay market level finance costs and had to make the industry standard profit margin.

Link to Irish Times article here: https://www.irishtimes.com/news/ireland/irish-news/affordable-housing-subsidy-must-double-for-dublin-housing-chief-says-1.4451582

Link to the Castlebar A2-rated 3 bed semi-detached units for sale here: https://www.myhome.ie/residential/brochure/the-clydagh-carrabeag-newport-road-castlebar-co-mayo/4470500

if they cant build houses in dublin for less that 300 - 400,000 euro build them down the country and get cracking on high speed train infrastructure for a change probably worth borrowing for it

combat14

any sign of brexit and covid disruption having an effect on irish economy 2021 or will we have to wait a few months to tell

Bass Reeves

PropQueries wrote: »

In the Irish Times on the 6th January, Brendan Kenny, Deputy Chief Executive of Dublin City Council stated the following:

"We cannot build a unit in Dublin for €300,000, no way. The average cost is more than €400,000. The schemes we are building at the moment, the big ones in the city, the average costs are €430,000 per unit."

At the moment, in Castlebar, A2 rated 119sq.m. 3 bed semi-detached houses are being advertised for €243,500.

I use an A2 rated example as I think this has to be the standard going forward. There are plenty of A3 rated units currently for sale for less and much closer to Dublin.

Can anyone reconcile the difference in cost in delivering similar sized A2-rated houses in Dublin given that site costs and labour costs do not appear to make up the c. €180,000 difference in costs between Dublin and the rest of the country even if the council had to pay market rates for the sites they build on, pay market level finance costs and had to make the industry standard profit margin.

Link to Irish Times article here: https://www.irishtimes.com/news/ireland/irish-news/affordable-housing-subsidy-must-double-for-dublin-housing-chief-says-1.4451582

Link to the Castlebar A2-rated 3 bed semi-detached units for sale here: https://www.myhome.ie/residential/brochure/the-clydagh-carrabeag-newport-road-castlebar-co-mayo/4470500

I am not sure what a site costs in Dublin but suspect it is in the 100k+ bracket. Down in Castlebar it probably sub 30k. After that you have labour not just for the houses but higher costs involved in maintaining a business in Dublin. Actual building labour could be 60% of the Dublin price. In Castlebar the builder may directly employ 50-80% of his labour directly.

For a worker or contractor building a house in Castlebar travel to and from work may involve a 15-30 minute travel time morning and evening compared to 50-90 minutes and maybe longer in Dublin. If we assume that 80k is the difference in site price there was s 10k extra in Vat Inc in the 100k difference. I imagine that levies paid to local authorities us higher in Dublin as well. You have to factor in higher professional fees in Dublin's as well from Engineers, certification and legal. Margin will alway remain a similar percentage even when costs cost is higher

TBH I have expected the difference to be higher

Browney7

Bass Reeves wrote: »

I am not sure what a site costs in Dublin but suspect it is in the 100k+ bracket. Down in Castlebar it probably sub 30k. After that you have labour not just for the houses but higher costs involved in maintaining a business in Dublin. Actual building labour could be 60% of the Dublin price. In Castlebar the builder may directly employ 50-80% of his labour directly.

For a worker or contractor building a house in Castlebar travel to and from work may involve a 15-30 minute travel time morning and evening compared to 50-90 minutes and maybe longer in Dublin. If we assume that 80k is the difference in site price there was s 10k extra in Vat Inc in the 100k difference. I imagine that levies paid to local authorities us higher in Dublin as well. You have to factor in higher professional fees in Dublin's as well from Engineers, certification and legal. Margin will alway remain a similar percentage even when costs cost is higher

TBH I have expected the difference to be higher

The build cost for DCC was ignoring land costs I believe

hometruths

PropQueries wrote: »

In the Irish Times on the 6th January, Brendan Kenny, Deputy Chief Executive of Dublin City Council stated the following:

"We cannot build a unit in Dublin for €300,000, no way. The average cost is more than €400,000. The schemes we are building at the moment, the big ones in the city, the average costs are €430,000 per unit."

At the moment, in Castlebar, A2 rated 119sq.m. 3 bed semi-detached houses are being advertised for €243,500.

I use an A2 rated example as I think this has to be the standard going forward. There are plenty of A3 rated units currently for sale for less and much closer to Dublin.

Can anyone reconcile the difference in cost in delivering similar sized A2-rated houses in Dublin given that site costs and labour costs do not appear to make up the c. €180,000 difference in costs between Dublin and the rest of the country even if the council had to pay market rates for the sites they build on, pay market level finance costs and had to make the industry standard profit margin.

Link to Irish Times article here: https://www.irishtimes.com/news/ireland/irish-news/affordable-housing-subsidy-must-double-for-dublin-housing-chief-says-1.4451582

Link to the Castlebar A2-rated 3 bed semi-detached units for sale here: https://www.myhome.ie/residential/brochure/the-clydagh-carrabeag-newport-road-castlebar-co-mayo/4470500

Welcome back!

Timing belt

PropQueries wrote: »

In the Irish Times on the 6th January, Brendan Kenny, Deputy Chief Executive of Dublin City Council stated the following:

"We cannot build a unit in Dublin for €300,000, no way. The average cost is more than €400,000. The schemes we are building at the moment, the big ones in the city, the average costs are €430,000 per unit."

At the moment, in Castlebar, A2 rated 119sq.m. 3 bed semi-detached houses are being advertised for €243,500.

I use an A2 rated example as I think this has to be the standard going forward. There are plenty of A3 rated units currently for sale for less and much closer to Dublin.

Can anyone reconcile the difference in cost in delivering similar sized A2-rated houses in Dublin given that site costs and labour costs do not appear to make up the c. €180,000 difference in costs between Dublin and the rest of the country even if the council had to pay market rates for the sites they build on, pay market level finance costs and had to make the industry standard profit margin.

Link to Irish Times article here: https://www.irishtimes.com/news/ireland/irish-news/affordable-housing-subsidy-must-double-for-dublin-housing-chief-says-1.4451582

Link to the Castlebar A2-rated 3 bed semi-detached units for sale here: https://www.myhome.ie/residential/brochure/the-clydagh-carrabeag-newport-road-castlebar-co-mayo/4470500

Welcome back Prop

JimmyVik

PropQueries wrote: »

In the Irish Times on the 6th January, Brendan Kenny, Deputy Chief Executive of Dublin City Council stated the following:

"We cannot build a unit in Dublin for €300,000, no way. The average cost is more than €400,000. The schemes we are building at the moment, the big ones in the city, the average costs are €430,000 per unit."

At the moment, in Castlebar, A2 rated 119sq.m. 3 bed semi-detached houses are being advertised for €243,500.

I use an A2 rated example as I think this has to be the standard going forward. There are plenty of A3 rated units currently for sale for less and much closer to Dublin.

Can anyone reconcile the difference in cost in delivering similar sized A2-rated houses in Dublin given that site costs and labour costs do not appear to make up the c. €180,000 difference in costs between Dublin and the rest of the country even if the council had to pay market rates for the sites they build on, pay market level finance costs and had to make the industry standard profit margin.

Link to Irish Times article here: https://www.irishtimes.com/news/ireland/irish-news/affordable-housing-subsidy-must-double-for-dublin-housing-chief-says-1.4451582

Link to the Castlebar A2-rated 3 bed semi-detached units for sale here: https://www.myhome.ie/residential/brochure/the-clydagh-carrabeag-newport-road-castlebar-co-mayo/4470500

Looks like there is a fortune to be made.
I dont know why everyone isnt building houses cheap and selling them

Idbatterim

not having a property tax, is a joke! Did or do we let people in massive engine cars, driver around with as good as free motor tax... no! The home is way more emotive, they wont touch it here. it just absolutely screws over the non homeowners, remember all decision makers are homeowners, they dont even have to be landlords to want rip off prices!

If you guys have time and are interested in why governments support rip off prices, take a look at this Australian documentary on the subject, it is excellent!

Hubertj

Under what category are services and utilities costs classified? I presume not direct build costs? Does Irish Water, ESB Networks, Bord Gáis, fibre (virgin etc) charge differently based on region? Or is only measure number of connections, price per metre of civils etc.
When councils self build do they only use council employees - tradesmen etc.? Public /civil servants work less hours and are less productive than in the real world.
Councils are not accountable for how wasteful they are with our money so there is no incentive to drive efficiencies as in the real world.