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2021 Irish Property Market chat - *mod warnings post 1*
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mcsean2163 wrote: »Do you understand that we are the third most indebted nation in the world? If we weren't in the EU, nobody would lend to us. We don't have our own money supply. The country of 5 million is close to a quarter of a trillion in debt.
You're advocating the government borrow and spend more?? Am I understanding you correctly?
jesus, we really really need to get over this nonsense, once again, public debt is the public entity of the money supply, money is effectively been thrown at us for free, some at negative rates! by advocating for an overall reduction in debt, both public and private, is advocating for a 'debt deflation'. if you want to crash your economy fairly quickly, do this, as a debt deflation is just as dangerous, if not more, than something like hyperinflation! this is the grown up version of modern economics, i.e. debt is the money supply, this process is called 'monetisation of debt', the limits of debt depends on your economies ability to service these debts, something we found out the hard way in the past, 08.
yes, im advocating for further government borrowing, as we ve become over reliant on the private sector money supply, i.e. credit, which just leads us into credit fueled booms, and subsequent busts.
we actually could create a limited money supply of our own if we wanted to via public banking systems, but theres little or no drive to do so, for some mental reason!0 -
mcsean2163 wrote: »Do you understand that we are the third most indebted nation in the world? If we weren't in the EU, nobody would lend to us. We don't have our own money supply. The country of 5 million is close to a quarter of a trillion in debt.
You're advocating the government borrow and spend more?? Am I understanding you correctly?
Gov can borrow for 20 years at less than a 1% yield at present. Instead, they choose to enter into 25 year leases at an initial yield of anywhere from 3 to 5% with CPI linked annual increases. Indeed, the only saving grace for some of these hair brained schemes is the government/council don't have to do any management. The recent publicity is that the funds may be willing to take less rent(so generous of them) if Joe council does the management.
Off balance sheet gymnastics and mortgaging future tax revenue to the hilt.0 -
I would also suspect that in most cases it would be a couple who could afford this rent and realistically if a couple are on a combined salary which allows them to pay 2k rent each month then they would presumably be in a good position to get a mortgage and buy within a couple of years, and in Ireland that is virtually always the end goal for people.
This was always my argument when banks offered me a paltry sum for a mortgage. My rent was higher than the repayment amount applied for, yet it was never taken into consideration. A 2k a month mortgage repayment would probably be close to a 500k house0 -
Spark Plug wrote: »There is very easy way for government to stop private equity funds in their tracks, change the tax laws. Most private equity funds use ICAV fund structures to purchase these assets, the main benefit is zero tax paid on rental income. All Pascal needs to do it amend the tax law to say any income from residential property is subject to 25% tax. It would stop said funds and I’d bet a good few might reconsider their recent purchases which would bring some much needed supply to the market
Has anyone from government commented on this yet I wonder on equity funds buying property en masse? They need to move swiftly on this topic. I've already contacted my local TDs to ask them about potential ways of reserving portions of new developments to first time buyers.0 -
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Has anyone from government commented on this yet I wonder on equity funds buying property en masse? They need to move swiftly on this topic. I've already contacted my local TDs to ask them about potential ways of reserving portions of new developments to first time buyers.
There are discussions. Don't know much about it. But reading article below it may end up new larger developments designed for 20% for social/affordable housing, 30% FTB, other 50% divided between Investors and Second time buyers.
https://www.newstalk.com/news/certain-amount-of-new-homes-could-be-ringfenced-for-first-time-buyers-under-plans-11810460 -
Wanderer78 wrote: »jesus, we really really need to get over this nonsense, once again, public debt is the public entity of the money supply, money is effectively been thrown at us for free, some at negative rates! by advocating for an overall reduction in debt, both public and private, is advocating for a 'debt deflation'. if you want to crash your economy fairly quickly, do this, as a debt deflation is just as dangerous, if not more, than something like hyperinflation! this is the grown up version of modern economics, i.e. debt is the money supply, this process is called 'monetisation of debt', the limits of debt depends on your economies ability to service these debts, something we found out the hard way in the past, 08.
yes, im advocating for further government borrowing, as we ve become over reliant on the private sector money supply, i.e. credit, which just leads us into credit fueled booms, and subsequent busts.
we actually could create a limited money supply of our own if we wanted to via public banking systems, but theres little or no drive to do so, for some mental reason!
David 'guarantee the banks' McWilliams has spoken.
We have borrowed MASSIVELY over the last year and the treasury is borrowing as much cheap debt as it can, still it has to be paid back at some point.
I could write a book on the stupidity of the McWilliams narrative but I'm not, I'm not engaging further except to say we are not the US and are instead a small country on the periphery of Europe.0 -
Wanderer78 wrote: »we actually could create a limited money supply of our own if we wanted to via public banking systems, but theres little or no drive to do so, for some mental reason!
How can we create our own money supply via public banking systems?
If we had a public banking system and if it was run at cost all it could do is use the would be "profit" to cut margins... It would still need to comply with CRDIV and all other EU legislation... Add on top that the there would be limited incentive for the bank to be operated efficiently so these cut in margins probably would not be as large as one would think.0 -
mcsean2163 wrote: »Do you understand that we are the third most indebted nation in the world? If we weren't in the EU, nobody would lend to us. We don't have our own money supply. The country of 5 million is close to a quarter of a trillion in debt.
You're advocating the government borrow and spend more?? Am I understanding you correctly?
You are correct, we have a huge public debt.
We have borrowed massively during 2020 and 2021 to respond to the effects of COVID.
As the vaccinations continue, and as the economy reopens, the budget deficit should fall.
Any suggestion that the State should continue to run 18bn annual deficits, and continue to borrow massively, while the economy recovers, or a suggestion that the State should run large budget deficits after the economy is fully-recovered, are very poor suggestions.0 -
You are correct, we have a huge public debt.
We have borrowed massively during 2020 and 2021 to respond to the effects of COVID.
As the vaccinations continue, and as the economy reopens, the budget deficit should fall.
Any suggestion that the State should continue to run 18bn annual deficits, and continue to borrow massively, while the economy recovers, or a suggestion that the State should run large budget deficits after the economy is fully-recovered, are very poor suggestions.
Agree and I believe the long term REIT agreements will have to be a part of that as they are unsustainable. We currently have a bubble caused by government, PUP, rent protection zones and wage support subsidy. I'd expect the market to cool a bit in Q3/ Q4. Sadly our dream house will likely be sold into this bubble being slightly out of reach.0 -
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https://www-irishtimes-com.cdn.ampproject.org/c/s/www.irishtimes.com/business/work/pandemic-set-to-change-shape-of-business-travel-forever-1.4547753?mode=amp
Relevant to the hotel and short term apartment rental sub sectors of the Irish property market.Pandemic set to change shape of business travel forever
Industry bracing itself for lasting decline of up to 25 per cent
Before the pandemic, business travel had grown annually for a decade. Now, the industry is bracing itself for a lasting decline of between 10 and 25 per cent, mainly because executives are expected to travel less in the future.
And, at a corporate level, the bean counters are happy with the often substantial savings being made on travel budgets. That alone is likely to change the definition of what constitutes an “essential” business trip forever. Add in the commitment by more and more organisations to a net-zero-emissions policy and the business travel market looks set for a bumpy recovery.
Bob Moritz is the global chairman of PwC and he has committed his firm to achieving zero emissions by 2030. This is going to involve reshaping how the firm works with its clients and halving the emissions associated with its business travel. In 2019, flight-related emissions represented about 85 per cent of PwC’s total carbon footprint and Moritz is on a mission to change this.
How significant this impact would be in terms of numbers is that there are estimated to be 26,000 rooms available in Dublin by 2023 up from 4,000 approx. right now (CBRE report quoted in IT last week). That is due to come from the many new hotels at planning or construction stage. Have we finally found our ghost estate of the boom of the 10s in hotels? At least REIT apartments can be flogged to private individuals, I'm not sure who will take on the hotel rooms.
Thinking further of the hit to business travel; even the short term/secondment type employment where employees are moved around the different offices of companies; a lot of accommodation providers of short term serviced apartments will be waiting a while for anything resembling the previous revenue stream returning. With people WFH so much going forward, even beyond covid, what is the point of a secondment? To go to a once a month meeting with the Dublin team from your Madrid base? This would of course apply to the hotels as well, there is no way they will have the footfall to get anywhere decent room occupancy for the next few years, if ever. Unless... The Gathering 2023 is launched and we promote Ireland as a tourist destination, maybe that might be the best way to try to fill these new hotels.0 -
Amadan Dubh wrote: »https://www-irishtimes-com.cdn.ampproject.org/c/s/www.irishtimes.com/business/work/pandemic-set-to-change-shape-of-business-travel-forever-1.4547753?mode=amp
Relevant to the hotel and short term apartment rental sub sectors of the Irish property market.
How significant this impact would be in terms of numbers is that there are estimated to be 26,000 rooms available in Dublin by 2023 up from 4,000 approx. right now (CBRE report quoted in IT last week). That is due to come from the many new hotels at planning or construction stage. Have we finally found our ghost estate of the boom of the 10s in hotels? At least REIT apartments can be flogged to private individuals, I'm not sure who will take on the hotel rooms.
Thinking further of the hit to business travel; even the short term/secondment type employment where employees are moved around the different offices of companies; a lot of accommodation providers of short term serviced apartments will be waiting a while for anything resembling the previous revenue stream returning. With people WFH so much going forward, even beyond covid, what is the point of a secondment? To go to a once a month meeting with the Dublin team from your Madrid base? This would of course apply to the hotels as well, there is no way they will have the footfall to get anywhere decent room occupancy for the next few years, if ever. Unless... The Gathering 2023 is launched and we promote Ireland as a tourist destination, maybe that might be the best way to try to fill these new hotels.
I'm guessing it is easier to repurpose a hotel to bedsits? If there are considering repurposing student accommadation then it must be doable for some hotels.0 -
I'm guessing it is easier to repurpose a hotel to bedsits? If there are considering repurposing student accommadation then it must be doable for some hotels.
It wouldn't be easy at all for a conventional hotel.
Student accommodation already has kitchens and the plant installs for that. As do aparthotels. Hotel builds are, for the bulk of rooms, a bedroom + an often modular bathroom; no space or capacity to add kitchens.0 -
This was always my argument when banks offered me a paltry sum for a mortgage. My rent was higher than the repayment amount applied for, yet it was never taken into consideration. A 2k a month mortgage repayment would probably be close to a 500k house
That’s true now while interest rates are a little over 2%. 8 or 9 years ago I was paying 4.4%. Mortgage was 1500 while houses in the estate were renting for 1000. Plus you have to maintain the house as well which isn’t cheap.0 -
Amadan Dubh wrote: »https://www-irishtimes-com.cdn.ampproject.org/c/s/www.irishtimes.com/business/work/pandemic-set-to-change-shape-of-business-travel-forever-1.4547753?mode=amp
Relevant to the hotel and short term apartment rental sub sectors of the Irish property market.
How significant this impact would be in terms of numbers is that there are estimated to be 26,000 rooms available in Dublin by 2023 up from 4,000 approx. right now (CBRE report quoted in IT last week). That is due to come from the many new hotels at planning or construction stage. Have we finally found our ghost estate of the boom of the 10s in hotels? At least REIT apartments can be flogged to private individuals, I'm not sure who will take on the hotel rooms.
Those numbers are messed up, or I don't understand what does it mean.0 -
Those numbers are messed up, or I don't understand what does it mean.
Maybe they mean right now during covid restrictions for the 4,000?
Here is the link to the article (3rd paragraph);
https://www.irishtimes.com/business/transport-and-tourism/covid-damage-to-dublin-s-hotels-to-be-offset-by-multinational-growth-1.45481180 -
mcsean2163 wrote:We have borrowed MASSIVELY over the last year and the treasury is borrowing as much cheap debt as it can, still it has to be paid back at some point.
Again, it's time for the adult talk on debt, once again, debt is the money supply, by not running a deficit, we force this critical need into the private sector, which creates this money in the form of credit, which in turn becomes our debts. This form of money creation has shown to largely inflate asset prices, in particular in relation to property, which ultimately lead to the 08 crash. It has shown to be the more volatile part of our overall money supply, baring in mind, globally, this is still the largest part of our money supply. Public debts in fact, just need to be serviced, and serviceable, in order to be sustainable, and it is also important to remember, the paying off of debt, is in fact the destruction of money itself, as accounts become balanced in the process. So by not increasing deficits, you become largely reliant on the private sector money supply, I. E. Credit, in order to expand your economy, as you need an expanding money supply to do so. These facts go way above and beyond mcwilliams, including other highly respected economists and institutions.Timing belt wrote:How can we create our own money supply via public banking systems?
Banks create our money supply, this is primarily done by the creation of credit, which in turn becomes our debts, this process is called 'monetisation of debt', but it is important to remember, the majority of our banks, globally, are a part of the private sector. Public banks are owned by the state, but also create this form of money, I.e. Via credit creation. The critical entity of this process is in fact, balancing budgets, which you ll find, as a nation, we re generally pretty damn good at doing. Other euro countries have public banks, including Italy, Germany and France, that operate as such. Scotland has recently created one, and Wales is in the process of doing so.Geuze wrote:Any suggestion that the State should continue to run 18bn annual deficits, and continue to borrow massively, while the economy recovers, or a suggestion that the State should run large budget deficits after the economy is fully-recovered, are very poor suggestions.
So the alternative is, reduce the public money supply, the deficit, become largely reliant on the private sector money supply, credit, and add in a regulator that's either asleep at the wheel or..... What could possibly go wrong!0 -
Amadan Dubh wrote: »https://www-irishtimes-com.cdn.ampproject.org/c/s/www.irishtimes.com/business/work/pandemic-set-to-change-shape-of-business-travel-forever-1.4547753?mode=amp
Relevant to the hotel and short term apartment rental sub sectors of the Irish property market.
How significant this impact would be in terms of numbers is that there are estimated to be 26,000 rooms available in Dublin by 2023 up from 4,000 approx. right now (CBRE report quoted in IT last week). That is due to come from the many new hotels at planning or construction stage. Have we finally found our ghost estate of the boom of the 10s in hotels? At least REIT apartments can be flogged to private individuals, I'm not sure who will take on the hotel rooms.
Thinking further of the hit to business travel; even the short term/secondment type employment where employees are moved around the different offices of companies; a lot of accommodation providers of short term serviced apartments will be waiting a while for anything resembling the previous revenue stream returning. With people WFH so much going forward, even beyond covid, what is the point of a secondment? To go to a once a month meeting with the Dublin team from your Madrid base? This would of course apply to the hotels as well, there is no way they will have the footfall to get anywhere decent room occupancy for the next few years, if ever. Unless... The Gathering 2023 is launched and we promote Ireland as a tourist destination, maybe that might be the best way to try to fill these new hotels.
Definitely a challenge for hotels and airlines. Business travel never fully recovered to pre September 11th levels. Airlines such as Ryanair are better placed for recovery due to their lower costs base and generally higher occupancy rates when planes do fly. Hotels in Ireland will have a challenge - tourism, conferences etc will take time to recover, especially when Ireland introduced false imprisonment at ports of entry. Maybe some hotels wont get built over the coming years.
I don’t think your comment about people not going on secondment makes any sense.0 -
Definitely a challenge for hotels and airlines. Business travel never fully recovered to pre September 11th levels. Airlines such as Ryanair are better placed for recovery due to their lower costs base and generally higher occupancy rates when planes do fly. Hotels in Ireland will have a challenge - tourism, conferences etc will take time to recover, especially when Ireland introduced false imprisonment at ports of entry. Maybe some hotels wont get built over the coming years.
I don’t think your comment about people not going on secondment makes any sense.
whats false imprisonment, particularly during a pandemic?0 -
I did see a single hotel room for sale on Daft last year, I think it was the Grand Canal hotel? Wonder if we'll see more of that. No cooking facilities etc, but would be the only thing in mortgage range for most people, assuming they'd actually get one for it.
Edit -
independent.ie/irish-news/a-magnificent-investment-opportunity-room-in-well-known-hotel-sold-for-more-than-99k-35335676.html
This place, was listed again in Feburary with an AMV of 90k0 -
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Wanderer78 wrote: »Again, it's time for the adult talk on debt, once again, debt is the money supply, by not running a deficit, we force this critical need into the private sector, which creates this money in the form of credit, which in turn becomes our debts. This form of money creation has shown to largely inflate asset prices, in particular in relation to property, which ultimately lead to the 08 crash. It has shown to be the more volatile part of our overall money supply, baring in mind, globally, this is still the largest part of our money supply. Public debts in fact, just need to be serviced, and serviceable, in order to be sustainable, and it is also important to remember, the paying off of debt, is in fact the destruction of money itself, as accounts become balanced in the process. So by not increasing deficits, you become largely reliant on the private sector money supply, I. E. Credit, in order to expand your economy, as you need an expanding money supply to do so. These facts go way above and beyond mcwilliams, including other highly respected economists and institutions.
Banks create our money supply, this is primarily done by the creation of credit, which in turn becomes our debts, this process is called 'monetisation of debt', but it is important to remember, the majority of our banks, globally, are a part of the private sector. Public banks are owned by the state, but also create this form of money, I.e. Via credit creation. The critical entity of this process is in fact, balancing budgets, which you ll find, as a nation, we re generally pretty damn good at doing. Other euro countries have public banks, including Italy, Germany and France, that operate as such. Scotland has recently created one, and Wales is in the process of doing so.
So the alternative is, reduce the public money supply, the deficit, become largely reliant on the private sector money supply, credit, and add in a regulator that's either asleep at the wheel or..... What could possibly go wrong!
The waffling about who creates the money supply is neither here nor there - the one pertinent fact of the matter is this: any government who has outstanding debts needs to repay or at least service (pay interest on) that debt.
Right now when interest rates are artificially low, then its grand you can refinance away. But in 10 or 20 years time when interest rates could be much higher, your servicing costs go way up for any debt maturing then. Never paying down your debt is the ultimate "kicking the can down the road" solution.
Keeping the national debt low protects us from any shocks in the future - cheap debt is only cheap as long as rates are.0 -
The waffling about who creates the money supply is neither here nor there - the one pertinent fact of the matter is this: any government who has outstanding debts needs to repay or at least service (pay interest) that debt.
Right now when interest rates are artificially low, then its grand you can refinance away. But in 10 or 20 years time when interest rates could be much higher, your servicing costs go way up for any debt maturing then. Never paying down your debt is the ultimate "kicking the can down the road" solution.
Keeping the national debt low protects us from any shocks in the future - cheap debt is only cheap as long as rates are.
the facts say otherwise!0 -
jill_valentine wrote: »I did see a single hotel room for sale on Daft last year, I think it was the Grand Canal hotel? Wonder if we'll see more of that. No cooking facilities etc, but would be the only thing in mortgage range for most people, assuming they'd actually get one for it.
Edit -
independent.ie/irish-news/a-magnificent-investment-opportunity-room-in-well-known-hotel-sold-for-more-than-99k-35335676.html
This place, was listed again in Feburary with an AMV of 90k
That wasn't for sale to be lived in and indeed you can't live in it. Its sold with a lease to the hotel operator in place.0 -
Definitely a challenge for hotels and airlines. Business travel never fully recovered to pre September 11th levels. Airlines such as Ryanair are better placed for recovery due to their lower costs base and generally higher occupancy rates when planes do fly. Hotels in Ireland will have a challenge - tourism, conferences etc will take time to recover, especially when Ireland introduced false imprisonment at ports of entry. Maybe some hotels wont get built over the coming years.
I don’t think your comment about people not going on secondment makes any sense.
I mean, I don't see what the point of paying for a 3 or 6 month apartment for someone in Dublin would be if the staff are hardly in the Dublin office themselves. Fly in, fly out or maybe a couple overnights a month could replace the typical secondment.0 -
jill_valentine wrote: »I did see a single hotel room for sale on Daft last year, I think it was the Grand Canal hotel? Wonder if we'll see more of that. No cooking facilities etc, but would be the only thing in mortgage range for most people, assuming they'd actually get one for it.
Edit -
independent.ie/irish-news/a-magnificent-investment-opportunity-room-in-well-known-hotel-sold-for-more-than-99k-35335676.html
This place, was listed again in Feburary with an AMV of 90k
I actually think this makes sense as an investment. The returns would be quite good, considering the average hotel room rental cost per night in Dublin. Not to say it isn't risky, but it isn't a bad investment to rent hotel rooms from hotels and let them manage them.0 -
Wanderer78 wrote: »the facts say otherwise!
Because the Irish wild-west property market would have been solved if the state just kept on deficit spending instead? I dont think so.0 -
Wanderer78 wrote: »whats false imprisonment, particularly during a pandemic?
“Mandatory hotel quarantine”, not the thread to discuss it but I was linking it to recovery in hotels/tourism as well as immigration. Embarrassing to this country.0 -
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Amadan Dubh wrote: »Maybe they mean right now during covid restrictions for the 4,000?
Here is the link to the article (3rd paragraph);
https://www.irishtimes.com/business/transport-and-tourism/covid-damage-to-dublin-s-hotels-to-be-offset-by-multinational-growth-1.4548118
Maybe, as there are currently way more than 4,000 rooms. Maybe many of the rooms are not available for booking currently. Not sure how they may count it.
But in the end, hotels will need to take the hit. It was a total lack of Hotel supply, now they will need to reduce price, thus probably reducing demands for AirBnb, and other short term rental apartments.0 -
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No change in policy coming even though housing minister is personally against what is happening.Housing minister Darragh O’Brien has said he doesn’t approve of so-called cuckoo funds buying homes in bulk but banning investment coming into the country would be a “pretty radical move”.
At the weekend it was reported that one investment fund had bought up most of a new estate of more than 100 houses in Malahide, north Dublin, in order to rent them out, meaning they were unavailable for purchase by first-time buyers.
“I don’t approve of international investors buying housing estates in bulk like as happened here - where funds are coming in and taking homes away from families is a concern,” said the minister.
https://www.independent.ie/irish-news/politics/housing-minister-darragh-obrien-doesnt-approve-of-cuckoo-funds-which-buy-up-housing-in-bulk-but-wont-ban-them-40385146.html0
This discussion has been closed.
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