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

Villa05

Vestiapx wrote:

Who requires social housing? Or is the question more who dosen't require social housing how do you decide who gets a house and who doesn't ? What are the criteria? I work I save I pay my deposit I pay my mortgage and I get my house but why don't I not save and not pay a mortgage and still get a house, what's the motivation for me ?

Is there not a graduated system for this?

Is the rental market not motivation enough

Many people work, we were close to full employment pre pandemic. Many jobs do not pay sufficiently to afford accommodation this is because of state inflationary interference in the market moreso than low wages

Graham wrote:

Why would you assume that the occupants of a property that's under threat of repossession would automatically need to find a studio/1-bed property under €700?

Serious question What would your expectation be? If they could afford a 700 rental, one would have to ask why this amount was not being paid on the mortgage, it would probably keep them in the house

DubLad69

I think that everyone has seen that the price of 2nd hand homes are rising quickly. But I have noticed that new builds are not increasing in price by anywhere near as much.

Is that because the builders are fearful that the prices are going to fall by a lot, so if they put their price up then they would have people pulling out by the time the house is complete.

Or are new builds generally less reactive to price changes?

JimmyVik

DubLad69 wrote: »

I think that everyone has seen that the price of 2nd hand homes are rising quickly. But I have noticed that new builds are not increasing in price by anywhere near as much.

Is that because the builders are fearful that the prices are going to fall by a lot, so if they put their price up then they would have people pulling out by the time the house is complete.

Or are new builds generally less reactive to price changes?

Dont worry. Any new starts from now on will reflect the higher prices, plus any grants or schemes going.

DubLad69

JimmyVik wrote: »

Dont worry. Any new starts from now on will reflect the higher prices, plus any grants or schemes going.

The new build estate that I purchased in started their first round of sales in October. The 2nd phase came in March, with no price increase at all. Then they have just announced their price for the next phase, and they have only put the price up by 3% and all the houses in this new phase have a south west garden which usually costs more anyway.

It just seems strange that they wouldn't take advantage of the higher prices.

Cyrus

DubLad69 wrote: »

The new build estate that I purchased in started their first round of sales in October. The 2nd phase came in March, with no price increase at all. Then they have just announced their price for the next phase, and they have only put the price up by 3% and all the houses in this new phase have a south west garden which usually costs more anyway.

It just seems strange that they wouldn't take advantage of the higher prices.

Where is it ?

If they have been struggling to sell the first few phases then that will colour their thinking.

It’s a lot easier sell a one off second hand house than 100 identical new builds.

Villa05

combat14 wrote:

It means that the buying and selling of homes is on a par with the level before the property market collapsed more than a decade ago.

Mortgage drawdowns at peak levels plus state and reits buying up new builds for social affordable plus looming shared ownership.
We are close to the peak of the bubble.

DubLad69 wrote:

I think that everyone has seen that the price of 2nd hand homes are rising quickly. But I have noticed that new builds are not increasing in price by anywhere near as much.

Where are you seeing this the latest daft report stated the opposite

Balluba

An auctioneer told me this week that many house sales are falling through. I don’t know how widespread this is though.

SmokyMo

Cyrus wrote: »

Why do you think there are so few banks offering mortgages in Ireland and why do you
think we pay higher margins than similar countries ?

All banks operating here whether Irish or not require to hold higher capital per lending unit compare to the rest. Due to 08. This is wrong because why should KBC follow that rule since it wasnt bailed out? But yet if you want to operate here you need to follow. This is was pushed on purpose by Irish banks to squeese competitions, since they have gapping wholes to fill.
So foreign banks would rather deploy that capital else where to generate higher returns. Essentially it is an ability to use higher leverage.
Ask mortgage brokers, people in fin sector who deal with credit lending, they will state the same. This has nothing to do with repossessions.

Cyrus wrote: »

Do you think people who don’t pay their mortgages should be allowed remain indefinitely?

No that's silly.

Cyrus wrote: »

Do you not thing non recourse loans (benefit to the consumer ) and swift repossessions (benefit to the lender ) would make more sense than what we have now ?

Of course, but I fail to see if that would have any impact on housing market or house pricing. As I said there are no numbers that I am aware of that back that up.
As of Dec 2020 only 38,785 accounts were in arrears more than 90 days. Which is around 5% of the total. Small numbers that do nothing but set you against your neighbor. Because it easier to hate Joe Soap not paying his mortgage while you at 9-5 than decades of failed government that did absolutely nothing for Irish people.

fliball123

schmittel wrote: »

Interestingly there were two separate items on Newstalk today (PK & Hard Shoulder) talking about whether or not we should be getting tougher on repossessions.

It seems to have been prompted by bonkers.ie research suggesting 46% are strongly in favour of a tougher stance

Is the penny finally starting to drop that we need to get on top of this problem?

The thing about this is that if 46% are in agreement then 54% are not the penny may be still well and truly in hand if 54% think no repossessions.

timmyntc

fliball123 wrote: »

The thing about this is that if 46% are in agreement then 54% are not the penny may be still well and truly in hand if 54% think no repossessions.

46% 'strongly in favour' doesnt mean 54% strongly opposed.
Likely there is strongly in favour, in favour, neutral/undecided, opposed, strongly opposed.

The research, which surveyed a nationally representative sample of just over 1,000 adults (+18) in the Republic of Ireland during March, shows that 45% of people say they are strongly in favour of a tougher stance being taken on borrowers who are in arrears if it led to lower mortgage rates. A further 25% say they are somewhat in favour.

This compares to 23% who are strongly against. Just 7% said they were unsure.

Cyrus

SmokyMo wrote: »

All banks operating here whether Irish or not require to hold higher capital per lending unit compare to the rest. Due to 08. This is wrong because why should KBC follow that rule since it wasnt bailed out? But yet if you want to operate here you need to follow. This is was pushed on purpose by Irish banks to squeese competitions, since they have gapping wholes to fill.
So foreign banks would rather deploy that capital else where to generate higher returns. Essentially it is an ability to use higher leverage.
Ask mortgage brokers, people in fin sector who deal with credit lending, they will state the same. This has nothing to do with repossessions.


No that's silly.


Of course, but I fail to see if that would have any impact on housing market or house pricing. As I said there are no numbers that I am aware of that back that up.
As of Dec 2020 only 38,785 accounts were in arrears more than 90 days. Which is around 5% of the total. Small numbers that do nothing but set you against your neighbor. Because it easier to hate Joe Soap not paying his mortgage while you at 9-5 than decades of failed government that did absolutely nothing for Irish people.

I still don’t know where you stand , repossession is not desirable or it is?

If it’s just silly that someone in arrears is allowed stay indefinitely what period is sensible?

I disagree with you I think if we had swift repossession and non recourse loans that you would see lower price inflation and lower priced mortgages .

And if you read any analysis on why mortgage rates here are high they will point to , repossessions, lack of competition and capital requirements, to say it’s not an issue and not considered an issue is disingenuous.

fliball123

timmyntc wrote: »

46% 'strongly in favour' doesnt mean 54% strongly opposed.
Likely there is strongly in favour, in favour, neutral/undecided, opposed, strongly opposed.

ah ok have you a link Timmy? The way it was quoted it was like it was 2 choices black or white. I didn't realise they have a few different options

timmyntc

Also from that article:

Country|Average interest rate*|Monthly Repayment |Enforcement success**|Length of judicial process
Ireland |2.79%|€1,026|11%|3.7 years
Netherlands |1.70%|€887|>85%|<1 year
Spain|1.52%|€865|>65%|<3 years
France|1.18%|€825|>45%|<1.5 years
Germany|1.15%|€821|>70%|<2 years
Austria|1.13%|€819|>65%|>3.5 years
Portugal |0.75%|€776|>70%|>3.5 years
Finland |0.67%|€767|>50%|<1.5 years
Denmark|0.00%|€694|>80%|<1 year

Hubertj

Villa05 wrote: »

Mortgage drawdowns at peak levels plus state and reits buying up new builds for social affordable plus looming shared ownership.
We are close to the peak of the bubble.



Where are you seeing this the latest daft report stated the opposite

I think it’s great that loads of people were able to purchase a home or move to a home more suitable to their requirements.

Is the daft report not just using asking price? Would the CSO provide a better indication if prices for 2nd hand houses are rising or falling?

RichardAnd

fliball123 wrote: »

The thing about this is that if 46% are in agreement then 54% are not the penny may be still well and truly in hand if 54% think no repossessions.

That's not too surprising. I think virtually everyone known at least one case of someone being fast and loose with mortgage payments whilst remaining in the house. I personally have a family member who has been under paying/not paying a mortgage for over a decade yet remains the owner of the house to which this applies. Family or not, that's not exactly proper order.

I have sympathy for people who fall on hard times, and I could well be in such a position myself someday. I wouldn't want to see a situation where one missed mortgage payment means you're out on the street, but if someone genuinely cannot or will not pay a mortgage, then the house should be repossessed and returned to the market.

On the flip side, the ability to repossess houses more readily should also mean lower interest rate and better deals for those who do keep up their side of the contract. These things go both ways.

fliball123

RichardAnd wrote: »

That's not too surprising. I think virtually everyone known at least one case of someone being fast and loose with mortgage payments whilst remaining in the house. I personally have a family member who has been under paying/not paying a mortgage for over a decade yet remains the owner of the house to which this applies. Family or not, that's not exactly proper order.

I have sympathy for people who fall on hard times, and I could well be in such a position myself someday. I wouldn't want to see a situation where one missed mortgage payment means you're out on the street, but if someone genuinely cannot or will not pay a mortgage, then the house should be repossessed and returned to the market.

On the flip side, the ability to repossess houses more readily should also mean lower interest rate and better deals for those who do keep up their side of the contract. These things go both ways.

Whats the bets the tail will yet again wag the dog. There will bleeding heart after bleeding heart if repossessions are ramped up even if the majority think this is the right way to go about it.

RichardAnd

fliball123 wrote: »

Whats the bets the tail will yet again wag the dog. There will bleeding heart after bleeding heart if repossessions are ramped up even if the majority think this is the right way to go about it.

Well yes, that's true. We can only hope that economic reality wins out over the screaming of a certain demographic.

PropQueries

fliball123 wrote: »

Whats the bets the tail will yet again wag the dog. There will bleeding heart after bleeding heart if repossessions are ramped up even if the majority think this is the right way to go about it.

While repossessions are of course right. However, the timing of this debate seems to be spot on now that the funds have purchased many of the non-performing mortgages from the banks.

C14N

flexcon wrote: »

My biggest fear would be people borrowing their max rate - at a time when the interest rates are low-is. (historically low)

If interest rates doubled in the next ten years - Wow. What a situation we could have on our hands then?

Banks do currently check for this too. I've gone through approvals with two recently and they assess what you currently put aside each month in rent + savings and compare that to a potential increase in interest rates to be able to see if you would still be able to handle the repayments under a higher interest rate. For me personally paying rent in Dublin and having been saving for a deposit, the repayments on a 3.5x salary mortgage are so vastly smaller than what is currently being put away that even if monthly repayments were to double it would still be less than is currently being put aside each month.

munstergirl

House in limerick sells in 23 minutes on daft, 30k over asking price.


https://www.limerickleader.ie/news/home/628662/quick-sale-limerick-home-sells-in-just-23-minutes.html

SmokyMo

Cyrus wrote: »

I still don’t know where you stand , repossession is not desirable or it is?
If it’s just silly that someone in arrears is allowed stay indefinitely what period is sensible?

Repossession should happen, but its an issue that is last on the list as it has negligent impact on problem we trying to solve.

Cyrus wrote: »

I disagree with you I think if we had swift repossession and non recourse loans that you would see lower price inflation and lower priced mortgages .

Disagree all you want but there is no evidence to show what you suggest will happen. What are you even basing this on?

Cyrus wrote: »

And if you read any analysis on why mortgage rates here are high they will point to , repossessions, lack of competition and capital requirements, to say it’s not an issue and not considered an issue is disingenuous.

Point me to any analysis on above? There are no reports from Banks or financials institutions that I aware off that point to repossessions as a primary cause for higher interest rates. None. As I said, reach out to your fin advisor or even mortgage broker if you have one, and ask them about leading factors.

I think you fail to understand those problems have different weights, and different order. Lack of competition is due to capital requirements, first of all.

Cyrus

PropQueries wrote: »

While repossessions are of course right. However, the timing of this debate seems to be spot on now that the funds have purchased many of the non-performing mortgages from the banks.

Are you outing schmittel as a vulture fund overlord ?

PropQueries

munstergirl wrote: »

House in limerick sells in 23 minutes on daft, 30k over asking price.


https://www.limerickleader.ie/news/home/628662/quick-sale-limerick-home-sells-in-just-23-minutes.html

Interesting story but all depends on who the purchaser is and if they're planning on entering a 25 year lease agreement with the council. Is the local council in Limerick as active as DCC are in Dublin?

hometruths

SmokyMo wrote: »

Are there numbers or some study done that shows lack of repossessions is causing high interests being charged on Irish consumer + banks leaving?

Because from CB stats number of mortgage areas keeps falling year on year.

As with most stats relating to our housing market, if you look at them with an open mind, rather than a confirmation bis picked up from the papers, they paint quite a different story.

Sure the headlines are mortgage arrears are falling, no doubt thanks to CB release highlighting as the first Key Point:

The number of principal dwelling house (PDH) accounts in arrears fell by 462 accounts in the fourth quarter of the year (Table 1). This was driven by a decline in longer-term arrears. Accounts in arrears over 2 years fell by 790 accounts over the last quarter, and by 2,104 accounts since December 2019.

A "decline in longer term arrears"? Sounds like we are moving in the right direction, but if you look at Table 1 the figure that jumps out is that the longest term arrears, over 10 years, have jumped by 1,371 or about 25%.

It is worth reading beyond Table 1 to have a look at restructurings. Most people think declining arrears figures mean that more people are paying off what they owe and catching up, but actually the decline is because accounts that were previously classified as arrears are now classified as restructured.

There were 4,203 new restructure arrangements agreed during the fourth quarter of 2020.

So we have a massive jump in 10 year arrears, and even by reclassifying 4,203 accounts as not in arrears, the total number of accounts in arrears only fell by 462 in the same period!

It does not sound like it is improving much to me!

Villa05

Cyrus wrote:

I still don’t know where you stand , repossession is not desirable or it is?

It's never desirable, necessary, yes

Hubertj wrote:

I think it’s great that loads of people were able to purchase a home or move to a home more suitable to their requirements.

Yes that would be great, however, I've an awful feeling that desperation is setting in and we have an 06/07 scenario that people are buying up whatever is available given the low supply to escape the rental market. In a downturn walking away from such a property becomes easier.

The market becomes overheated and the social affordable model becomes more expensive bringing the day of reckoning closer

Hubertj wrote:

Is the daft report not just using asking price? Would the CSO provide a better indication if prices for 2nd hand houses are rising or falling?

In a market of low supply achieved price is more often higher than asking while new build price is set

fliball123

SmokyMo wrote: »

Repossession should happen, but its an issue that is last on the list as it has negligent impact on problem we trying to solve.


Disagree all you want but there is no evidence to show what you suggest will happen. What are you even basing this on?


Point me to any analysis on above? There are no reports from Banks or financials institutions that I aware off that point to repossessions as a primary cause for higher interest rates. None. As I said, reach out to your fin advisor or even mortgage broker if you have one, and ask them about leading factors.

I think you fail to understand those problems have different weights, and different order. Lack of competition is due to capital requirements, first of all.

The problem with repossessions as I see it is there is already a large number of people on the waiting list for housing, once this starts happening a certain % will be strategic and some will be in a position to move. Unfortunately there will be a large cohort who will need housing and will not have a pot to p1ss in. Its this cohort that the left leaning mouth pieces will focus on. I can see the tabloid stories already. Meet Mary, Mary has 5 kids all under 12 years of age who has not paid her mortgage for 10 years and the big bad bank has harassed her for 10 years to pay and now she will be made homeless. There will be nothing about Daddy paying his way or Mary not giving a flying F%^$ about having more kids knowing she couldn't afford them. Yet anyone even asking these question of where is daddy and why the hell did you have more kids when you knew you could not afford them would be called out as being morally wrong.

The tail is wagging the dog in this country when it comes to our housing. Welfare and public sector spend.

Villa05

PropQueries wrote:

While repossessions are of course right. However, the timing of this debate seems to be spot on now that the funds have purchased many of the non-performing mortgages from the banks.

Do the figures for arrears include mortgages purchased by these funds?

Cyrus

SmokyMo wrote: »

Repossession should happen, but its an issue that is last on the list as it has negligent impact on problem we trying to solve.


Disagree all you want but there is no evidence to show what you suggest will happen. What are you even basing this on?


Point me to any analysis on above? There are no reports from Banks or financials institutions that I aware off that point to repossessions as a primary cause for higher interest rates. None. As I said, reach out to your fin advisor or even mortgage broker if you have one, and ask them about leading factors.

I think you fail to understand those problems have different weights, and different order. Lack of competition is due to capital requirements, first of all.

I don’t believe I said repossession was the primary factor in higher interest rates ?

The Irish mortgage market is not attractive to outside banks for a number of reasons, ability to repossess the asset is one of those factors.

And directing someone to a mortgage advisor for insight on this or any other issue , is that some sort of joke ?

munstergirl

PropQueries wrote: »

Interesting story but all depends on who the purchaser is and if they're planning on entering a 25 year lease agreement with the council. Is the local council in Limerick as active as DCC are in Dublin?

It sounds like from article, the buyer was someone who grew up in area.

Don't know if Limerick council are buying private properties at the moment, they bought a lot during regeneration, that was a few years ago.

Reins

munstergirl wrote: »

House in limerick sells in 23 minutes on daft, 30k over asking price.


https://www.limerickleader.ie/news/home/628662/quick-sale-limerick-home-sells-in-just-23-minutes.html

" Sale Agrees "

Not Sold yet