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

timmyntc

MacronvFrugals wrote: »

Is it not significantly better value for the council just to buy these?



Dublin social housing portfolio guiding at €21m





https://www.irishtimes.com/business/commercial-property/dublin-social-housing-portfolio-guiding-at-21m-1.4549153

JimmyVik wrote: »

They cant tap the tax payer for the money all in one go. Easier to bleed them for years instead.

As explained earlier today, EU fiscal rules mean we cant borrow as much as we like to build housing. If you agree a 25year lease it doesnt show up as 25years of spending in one go, its spread across years.

That said, I dont know why the state doesnt try take advantage of the pandemic finance available & finance as many social builds as possible within this window before the taps are turned off and EU spending rules back in place.

MacronvFrugals

timmyntc wrote: »

As explained earlier today, EU fiscal rules mean we cant borrow as much as we like to build housing. If you agree a 25year lease it doesnt show up as 25years of spending in one go, its spread across years.

That said, I dont know why the state doesnt try take advantage of the pandemic finance available & finance as many social builds as possible within this window before the taps are turned off and EU spending rules back in place.

I would also describe anything that forces us into these wreckless lease deals as "dangerous"

Economists Philippe Martin, Jean Pisani-Ferry and Xavier Ragot said in a policy paper that the 3% cap, along with a rule requiring governments to work towards keeping debt to 60% of GDP, are obsolete and the deficit cap could even spur dangerously unnecessary budget rigour after the crisis.

https://www.reuters.com/article/us-eu-budget-france-idUSKBN2C018I

Bass Reeves

timmyntc wrote: »

As explained earlier .

We have been through many of these same debates for the last 12 months. Props continually bring up the Sisk 2018 house build price for a one off development for Dublin LA. He has ignored price rises since. He continually cannot grasp that you can pay any trades person less in Rural Ireland than in Urban situation or especially in Dublin's.

It's the same with a number of other contributors they cannot seem to grasp rules and regulations. They cannot seem to understand that we have a limited labour supply and how that limit housing supply. You can explain again and again and again but Props will quote the Sisk figure ignoring that the pricing is about 4 years out of date. Some other contributor will come on about the number of vacant houses ignore where they are situated and whether they need refurbishment.

This time last year as we came out of the first wave we had lads predicting a 20-70% price collapse and telling people buying to low ball bid, play hard ball as well as peudo advice to drop sales. Some continued predict not just price drop but price collapse right out into Autumn predicting a price collapse in 3-4 months time from there prediction

1percent

MacronvFrugals wrote: »

Is it not significantly better value for the council just to buy these?



Dublin social housing portfolio guiding at €21m






https://www.irishtimes.com/business/commercial-property/dublin-social-housing-portfolio-guiding-at-21m-1.4549153

Running the rule across that it has a proposed yield of 4.5% with an average rent of €1322/unit. Is the rent that cheap or may it be a case that not all units are occupied?

hmmm

MacronvFrugals wrote: »

Is it not significantly better value for the council just to buy these?

From the report, this costs the council €952,000 a year versus having to pay €21 million up front.

It might be better value in the longer term, but I can understand where the council are coming from if they've been told to go out and maximise their current budgets.

MacronvFrugals

hmmm wrote: »

From the report, this costs the council €952,000 a year versus having to pay €21 million up front.

It might be better value in the longer term, but I can understand where the council are coming from if they've been told to go out and maximise their current budgets.

Even with the council on the hook for maintenance and upward only rent reviews?

Index-linked rent reviews are provided for in every third year.

All that money and the state has no asset to show for it is what i find just crazy

PropQueries

Bass Reeves wrote: »

We have been through many of these same debates for the last 12 months. Props continually bring up the Sisk 2018 house build price for a one off development for Dublin LA. He has ignored price rises since. He continually cannot grasp that you can pay any trades person less in Rural Ireland than in Urban situation or especially in Dublin's.

It's the same with a number of other contributors they cannot seem to grasp rules and regulations. They cannot seem to understand that we have a limited labour supply and how that limit housing supply. You can explain again and again and again but Props will quote the Sisk figure ignoring that the pricing is about 4 years out of date. Some other contributor will come on about the number of vacant houses ignore where they are situated and whether they need refurbishment.

This time last year as we came out of the first wave we had lads predicting a 20-70% price collapse and telling people buying to low ball bid, play hard ball as well as peudo advice to drop sales. Some continued predict not just price drop but price collapse right out into Autumn predicting a price collapse in 3-4 months time from there prediction

Well, given that the affordable housing bill puts a maximum price of c. €225k on a Co. Tipperary A-rated new build home and once you remove land costs, VAT, levies, builders profit etc. etc., the building costs today appear to match up closely with Sisk Livings cost of build 3 years ago, unless that bill is going to be amended to a higher price level.

And if the price of Co. Tipperary homes were to be amended upwards, would they also have to amend the Dublin affordable house prices upwards to the c. €500k - €600k price range?

hometruths

Bass Reeves wrote: »

It's the same with a number of other contributors they cannot seem to grasp rules and regulations. They cannot seem to understand that we have a limited labour supply and how that limit housing supply. You can explain again and again and again but Props will quote the Sisk figure ignoring that the pricing is about 4 years out of date. Some other contributor will come on about the number of vacant houses ignore where they are situated and whether they need refurbishment.

And as sure as night follows day some other contributor will bring up that old canard that the vacant properties are actually derelicts situated in areas where there is no demand.

Seems as good a time as any to repost Timingbelts excellent local breakdown for Dublin city:



Vacancy rate of 9% in Dublin City, with some of the highest demand areas showing vacancy rates of well over double what you'd expect in a normal housing market, never mind a housing shortage crisis?!!

Some contributors indeed ignore the fact a shocking amount of the vacancies are situated in Dublin. And they ignore the fact that Dublin is one of the few locations where the vacancies are rising.

Amadan Dubh

Ronan Lyons writing in The Currency today, of the opinion that the extraordinary situation the past year in the housing market is likely to be a temporary state of affairs. Well, I don't think anyone would dispute that the price rises were unlikely to be sustainable given supply crashed while demand exploded, but it is interesting that his view is that the primary reason for the collapse in supply was due to second hand homes not being put on the market as opposed to construction being shuttered.

https://thecurrency.news/articles/46503/lockdown-liquidity-and-respite-for-homebuyers-what-the-data-tells-us-about-the-outlook-for-house-prices/

Supply has collapsed for two reasons. The first, and less important, is the obvious one: if you’re not allowed build, because of public health restrictions, that will clearly have an impact on the supply of newly built homes. As it happens, and not least because Ireland was not building enough homes anyway pre-covid, this has been secondary. (Indeed, figures out in early May suggest the completion of new homes was surprisingly high in the first quarter of 2021.)

The far more important reason is in the collapse of the second-hand market. If you can’t go see properties, you’re far less likely to put your own home on the market. And of course the longer the pandemic restrictions went on, the clearer it became that prices were rising – so why not wait a little bit longer, even if you were able to list now?

The total number of homes put on the market in the first two months of 2021 was down almost 40 per cent on the same two months in 2020. This pattern is repeated in every market across the country. With strong demand and such weak supply, there were fewer than 12,000 homes available to buy online in Ireland on the 1st of March this year. That figure is simply incomparable to anything in the internet age. The average number of homes for sale online between January 2007 and December 2019 was over 40,000. And while that number had been falling pre-covid, there were still over 20,000 homes for sale on February 1st.

The impact of the first lockdown is obvious: barely 4,000 homes listed for sale over the course of April and May, compared to 12,000 in the typical year. But so is the bounce-back in the following three months. Between June and August, there were 16,000 homes listed last year – almost exactly in line with the 2015-2019 average.

Perhaps surprisingly, given how often you hear commentators claim that the laws of supply and demand don’t apply to housing, the market has been sending us very clear signals over the past fifteen years. When there are fewer homes available to buy, prices increase. When there are between about 4,000 and 5,000 homes on the market, there is little pressure – up or down – on Dublin sale prices. And when there are lots of homes for sale – in some cases up to 7,000 – prices fall rapidly.

It will probably amaze those under the age of 40 to learn that, as recently as the 1980s, a home in Dublin didn’t cost anything more, on average, than a home in rural Ireland. Over the past three decades, however, as the country has found its economic model and entered a prolonged phase of growth, its housing system has been unable to respond at the right scale. Once again, this is supply and demand in action.

The metaphor of staying in shape is probably an apt one. Staying fit is an endless battle. Every day, every week, every month, you have to put the effort in – otherwise the needle will start to shift in the wrong direction.

Keeping housing affordable is the same. It means getting sufficient new housing built, month after month, year after year – decade after decade. Ireland has failed to do that now for three decades. Its housing market is totally out of shape. Here’s hoping that once policymakers have some headspace post-covid, they can finally put in place the long-term systemic housing policy the country needs to enable its growth and its residents to have the home they need.

Now I see why Props talks of seeing big things happening in August - covid restrictions will be all but dusht at that stage and the floodgates of second hand homes hitting the market will be opened (let's not forget Brexit as well, minimal to no fallout)!

timmyntc

MacronvFrugals wrote: »

Even with the council on the hook for maintenance and upward only rent reviews?





All that money and the state has no asset to show for it is what i find just crazy

It is crazy, make no mistake.
But if they are to abide by EU deficit rules then there isnt massive scope for social housing building by govt unless we get spending cutbacks elsewhere.

Really it should be pushed back against rather than accepting it and trying to farm it all out to private sector

AlmightyCushion

MacronvFrugals wrote: »

I would also describe anything that forces us into these wreckless lease deals as "dangerous"




https://www.reuters.com/article/us-eu-budget-france-idUSKBN2C018I

I think it would be a good idea to alter it so that infrastructure spending can be excluded from it. Specifically housing, public transport and green infrastructure. It would stop countries running up debts on tax cuts and things like that but still allow them to provide necessary infrastructure.

fliball123

Amadan Dubh wrote: »

Ronan Lyons writing in The Currency today, of the opinion that the extraordinary situation the past year in the housing market is likely to be a temporary state of affairs. Well, I don't think anyone would dispute that the price rises were unlikely to be sustainable given supply crashed while demand exploded, but it is interesting that his view is that the primary reason for the collapse in supply was due to second hand homes not being put on the market as opposed to construction being shuttered.

https://thecurrency.news/articles/46503/lockdown-liquidity-and-respite-for-homebuyers-what-the-data-tells-us-about-the-outlook-for-house-prices/



Now I see why Props talks of seeing big things happening in August - covid restrictions will be all but dusht at that stage!

Do I point out the obvious again with this train of thought. Zero sum game for every 2nd hand property put up for sale the demand for a 2nd hand property will go up by one as the seller now needs to buy

Hubertj

schmittel wrote: »

And as sure as night follows day some other contributor will bring up that old canard that the vacant properties are actually derelicts situated in areas where there is no demand.

Seems as good a time as any to repost Timingbelts excellent local breakdown for Dublin city:



Vacancy rate of 9% in Dublin City, with some of the highest demand areas showing vacancy rates of well over double what you'd expect in a normal housing market, never mind a housing shortage crisis?!!

Some contributors indeed ignore the fact a shocking amount of the vacancies are situated in Dublin. And they ignore the fact that Dublin is one of the few locations where the vacancies are rising.

0.4% increase in vacancy rate for Dublin if the postmen are to be relied on.

timmyntc

fliball123 wrote: »

Do I point out the obvious again with this train of thought. Zero sum game for every 2nd hand property put up for sale the demand for a 2nd hand property will go up by one as the seller now needs to buy

Some people downsize, others sell their home to finance the building of a new one. Some leave the country.

It's not a massive effect, but its far from zero sum.

fliball123

timmyntc wrote: »

Some people downsize, others sell their home to finance the building of a new one. Some leave the country.

It's not a massive effect, but its far from zero sum.

OK and some people up size and with our migration laws set to change from 8 years to 4 months for a person supposedly being an illegal immigrant to a legal immigrant we are going to have a tsunami of people coming here, even with out this we have had nett+ migration coming into the country even in 2020 (the year of the lockdown) for the last 6 years or so.

timmyntc

fliball123 wrote: »

OK and some people up size and with our migration laws set to change from 8 years to 4 months for a person supposedly being an illegal immigrant to a legal immigrant we are going to have a tsunami of people coming here, even with out this we have had nett+ migration coming into the country even in 2020 (the year of the lockdown) for the last 6 years or so.

Total whataboutery.

What has immigration to do with second hand sales *not* being a zero-sum game?
Square root of f*ck all thats what

fliball123

timmyntc wrote: »

Total whataboutery.

What has immigration to do with second hand sales *not* being a zero-sum game?
Square root of f*ck all thats what

Relax there the point you were trying to make is that people have been holding off putting their second hand property up for sale. I have simply pointed out that if this does ramp up it will up supply by 1 and demand by 1 so zero sum. You then tried to muddy this by the ultimate whataboutery of some people downsize some people sell and leave the country haha and your pointing that finger at me. The stats are there migration inward for 6 years. As well as knowing some people upsize I literally did this my self last year. Hows that for whataboutery and nothing like going through a year of lockdowns for you wanting a bigger place

MacronvFrugals

timmyntc wrote: »

It is crazy, make no mistake.
But if they are to abide by EU deficit rules then there isnt massive scope for social housing building by govt unless we get spending cutbacks elsewhere.

Really it should be pushed back against rather than accepting it and trying to farm it all out to private sector

The irony of the non-majoritarian stability mechanisms pushing us into these fiscally irresponsible deals.

PropQueries

fliball123 wrote: »

Do I point out the obvious again with this train of thought. Zero sum game for every 2nd hand property put up for sale the demand for a 2nd hand property will go up by one as the seller now needs to buy

Anyone know of the potential backlog in probate sales due to the covid restrictions and how fast they may be cleared?

Barry Cowen put the potential figure of such homes that could be entering probate each year at up to c. 26k in 2018 and even back then, his comments in the Dail were in relation to the significant backlog that existed at that stage and that the backlog was limiting the supply of such properties re-entering the market.

Could be a tsunami of such sales ready to re-enter the market in a relatively short period of time IMO. And, many would be in sought after, prime locations in our cities and towns.

Marius34

Hubertj wrote: »

0.4% increase in vacancy rate for Dublin if the postmen are to be relied on.

Postman shows increase, thus it's important. But if the same postman shows that overall it still low vacancy, that not really important. It requires deep analysis if he missed something.
Census shows that some people have not stayed over the weekend at home, that's important to add to the vacancy numbers.

fliball123

PropQueries wrote: »

Anyone know of the potential backlog in probate sales due to the covid restrictions and how fast they may be cleared?

Barry Cowen put the potential figure of such homes that could be entering probate each year at up to c. 26k in 2018 and even back then, his comments in the Dail were in relation to the significant backlog that existing at that stage and that the backlog was limiting the supply of such properties re-entering the market.

Could be a tsunami of such sales ready to re-enter the market in a relatively short period of time IMO. And, many would be in sought after, prime locations in our cities and towns.

Maybe Props I have not seen any figures on them. The figures we can see is that birth rates have exceeded death rates over the last 100 years even in 2020 with Covid

hmmm

MacronvFrugals wrote: »

Even with the council on the hook for maintenance and upward only rent reviews?

The council are looking at cash flow, not value. It's spend 21 million now or 1 million. Who-ever is around in 10 years time can worry about value.

hometruths

Hubertj wrote: »

0.4% increase in vacancy rate for Dublin if the postmen are to be relied on.

Approx 2000 more vacant properties in 6 months is a lot in housing shortage. The rate is trending upwards in highest demand area of the country. And it is one of the only counties showing this upward trend.

It's significant.

timmyntc

fliball123 wrote: »

Relax there the point you were trying to make is that people have been holding off putting their second hand property up for sale. I have simply pointed out that if this does ramp up it will up supply by 1 and demand by 1 so zero sum. You then tried to muddy this by the ultimate whataboutery of some people downsize some people sell and leave the country haha and your pointing that finger at me. The stats are there migration inward for 6 years. As well as knowing some people upsize I literally did this my self last year. Hows that for whataboutery and nothing like going through a year of lockdowns for you wanting a bigger place

Yes but people immigrating is irrelevant.

We were discussing solely on 2nd hand homes and whether they are zero-sum, which they arent. People do sell and leave the country. Whether that is offset by immigration is irrelevant - otherwise you could say that new builds are a zero-sum game because immigrants more than make up for any demand catered to by the new build supply.
i.e. total nonsense argument from you

hometruths

Marius34 wrote: »

Postman shows increase, thus it's important. But if the same postman shows that overall it still low vacancy, that not really important. It requires deep analysis if he missed something.
Census shows that some people have not stayed over the weekend at home, that's important to add to the vacancy numbers.

Postman shows increase and postman shows it is overall high vacancy.

I know you disagree. We have been over this before:

Marius34 wrote: »

Don't ask me why is this, as I don't have proof to explain this, and I don't want to discuss "what I think".

Cyrus

PropQueries wrote: »

Could be a tsunami of such sales ready to re-enter the market in a relatively short period of time IMO. And, many would be in sought after, prime locations in our cities and towns.

you will need a tsunami of some sort if your predictions are to come close to fruition

cnocbui

timmyntc wrote: »

Yes but people immigrating is irrelevant.

We were discussing solely on 2nd hand homes and whether they are zero-sum, which they arent. People do sell and leave the country. Whether that is offset by immigration is irrelevant - otherwise you could say that new builds are a zero-sum game because immigrants more than make up for any demand catered to by the new build supply.
i.e. total nonsense argument from you

Emigration is very problematic at the moment. I want to sell up and flee, but NZ isn't exactly open to my entry at the moment, now is it? And this looks like persisting through 2022 as well. I won't be putting my house on the market until I can actually get where I am going.

Marius34

schmittel wrote: »

Postman shows increase and postman shows it is overall high vacancy.

I know you disagree. We have been over this before:

Except, that I'm sharing what they say:
"In contrast to the low vacancy rates of the Greater Dublin Area, there is a different picture in the west of the country, with the three highest vacancy rates all found in Connacht"

https://www.geodirectory.ie/knowledge-centre/reports-blogs/geoview-residential-buildings-report-q2-2020#:~:text=GeoView%20Residential%20Buildings%20Report%20Q2%202020%20Highlights&text=In%20Dublin%20the%20decline%20in,a%20decrease%20in%20vacancy%20rates

Since you don't like what they say, it requires your explanation what it "means"

fliball123

timmyntc wrote: »

Yes but people immigrating is irrelevant.

We were discussing solely on 2nd hand homes and whether they are zero-sum, which they arent. People do sell and leave the country. Whether that is offset by immigration is irrelevant - otherwise you could say that new builds are a zero-sum game because immigrants more than make up for any demand catered to by the new build supply.
i.e. total nonsense argument from you

Timmy
If we have more people living here via immigration it means we need more housing to house them

If we have had more births than deaths over the last 100 years it means we have need more housing as we have more people who need to live here.

I believe our population has grown by nearly 500k in the last decade and where people like yourself fall down is by not joining the dots and understanding that they all need somewhere to live. It can be renting, building, sharing, buying or looked after by the state

Now then what has the government been doing since SF started pointing the gun at them about housing. They started buying more and more property and renting from REITS/Vultures and even private landlords. Do you not think that our increase in population has had nothing to do with this?? along with covid and the impact on new builds slowing down this has not been the main reason for the scenario we are in.

So then you have REITS buying more and more property due to the state backed guaranteed high returns they will get. This in turn has taken supply away from FTBs and STBs

So immigration when it comes to housing is relevant. Its relevant as it skews the amount of property we need to have in the country. I cant understand how you cannot see this. Its pretty simple so i will break the equation down for you

More people = a need for more housing


so its not a nonsense argument

Hubertj

schmittel wrote: »

Approx 2000 more vacant properties in 6 months is a lot in housing shortage. The rate is trending upwards in highest demand area of the country. And it is one of the only counties showing this upward trend.

It's significant.

0.2% decrease nationally.