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2021 Irish Property Market chat - *mod warnings post 1*
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jill_valentine wrote: »It's funny you say that, it has a real feel of London urban desert. I've a real morbid fascination about both, in a Life After People sort of way.
I suppose the difference is I tend to just assume Canary Wharf buildings are largely office or commercial, whereas around Spencer Dock etc you can just look up to the balconies and see for yourself that they're apartments and nobody's in them.
No plenty of residential building in canary wharf.
I was staying in one for about a month and thought it was something like 28 days later in the evening. Only the skateboarders would be seen for a while and eventually they go home and its totally deserted..0 -
The current VSL is 7%.
https://www.citizensinformation.ie/en/environment/buildings_and_structures/vacant_sites.html
I don't think it has been very effective at releasing sites.
Maybe it should be higher?
It virtually impossible to collect as it's too high. On any vacant site there is a 2-3 year development lead in. This is down to design, planning and getting to busing stage. If a builder/developer are going through this process the levy is not collectables. There is only 1*2 attempts to collect it mainly against farmers who's lands were zoned with out there involvment in the process. They continued to farm it and some council official taught they could enforce the collection. AFAIK virtually nothing has been collected from it.......and I guess never will.
A tax has to be collectable. Set the rate at 1% and collect it rebate last 5 years when site is build onSlava Ukrainii
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What a good decision by FF increasing stamp duty for everyone to deter cuckoo funds. Could have made the decision earlier but better late than never.0
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Interesting stats from the latest CSO report for march
Number FTB falling down 2.5%
77% of FTB purchases were for 2nd hand properties
Median price in Dublin approaching 400k
Looks like the investment funds have pushed FTB out of the new builds market.
We are starting to see why FF wanted shared ownership despite all the advise against
How many new builds were sold in march?0 -
Amadan Dubh wrote: »The big question is how, in a housing crisis, can properties be left vacant rather than dropping rents until they are let?
The data on the state of the market indicates rents have decreased slightly over the last year in Dublin but are potentially starting to increase again in Dublin. However, due to the level of vacancies, it is quite obvious that the Daft report is not a complete picture of the state of the market. Do we potentially already have our ghost estates from the economic growth period from 2012?
Yes the daft report seems to use number of ads on the platform as opposed to properties but it needs clarification for sure.0 -
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Interesting stats from the latest CSO report for march
Number FTB falling down 2.5%
77% of FTB purchases were for 2nd hand properties
Median price in Dublin approaching 400k
Looks like the investment funds have pushed FTB out of the new builds market.
We are starting to see why FF wanted shared ownership despite all the advise against
2nd hand YoY growth swung by 3%, new by .4%
In one quarter second hand growth has caught up and passed new.
Would the theory be, a combination of the lack of new supply, and the price of new supply edging up making 2nd hand more attractive again?0 -
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They went even further in the US in writing mortgage contracts for dead people and selling them onto banks.jill_valentine wrote: »If I remember rightly, before the housing market collapse in the US, some of them were able to see the canary in the coal mine by just knocking on doors and having nobody answer. Harder to do that with apartments, obviously, but I'd nearly be bored enough to take photos some ****e night and count myself.
Here our Taoiseach at the time said people who warned about the impending property crash were cribbers and moaners and didn't understand why such people didn't kill themselves listening to their own words.
As someone else mentioned earlier these pension funds have been buying tranches of Dublin apartments for years, but it's only when they bought houses did the general public get triggered.
If the government are going to ignore the empties now they did in Berties time my only question is what will trigger the pullback by international pension funds?0 -
They went even further in the US in writing mortgage contracts for dead people and selling them onto banks.
Here our Taoiseach at the time said people who warned about the impending property crash were cribbers and moaners and didn't understand why such people didn't kill themselves listening to their own words.
As someone else mentioned earlier these pension funds have been buying tranches of Dublin apartments for years, but it's only when they bought houses did the general public get triggered.
If the government are going to ignore the empties now they did in Berties time my only question is what will trigger the pullback by international pension funds?
Is there a way to know if these funds are buying more "traditional" houses in the last year than they might do otherwise, vs apartments? I know it feels like that, but are there statistics we could compare?
If so, I'd think that would mean that either a) the funds see writing on the wall for the empty showroom apartment market and they're trying to get a ahead of any unfortunate events by branching out or b) they're approaching a practical ceiling in what they can build or buy for the apartment market. I have to think houses out of town are quite a bit riskier and involve a lot more ongoing attention.0 -
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Its a paywall article but interesting to note the IMF are recommending we increase taxes
The IMF’s point man on Ireland on increasing taxes, fixing the housing crisis and helping SMEs survive the pandemic
https://t.co/P3HggrjrRH?amp=10 -
Amadan Dubh wrote: »There's nothing wrong with it but it's just important to remember it is only a snapshot of a segment of the market.
While it's useful for the trends for sure, Lyons made the conclusion you need 4000 properties for rent at a time for rents to fall/stay stable. We may be at that number despite the number of ads being below it for example.0 -
They went even further in the US in writing mortgage contracts for dead people and selling them onto banks.
Here our Taoiseach at the time said people who warned about the impending property crash were cribbers and moaners and didn't understand why such people didn't kill themselves listening to their own words.
As someone else mentioned earlier these pension funds have been buying tranches of Dublin apartments for years, but it's only when they bought houses did the general public get triggered.
If the government are going to ignore the empties now they did in Berties time my only question is what will trigger the pullback by international pension funds?
If the government bans the entering into leases for 20/25 years by the councils and the institutionals have to try to draw €2k+ blood rents from the income tax payer stone, then I could see the "get rich quick" US investors starting to question the risk versus returns. The pension funds perhaps would just look to hold the asset and achieve some income over the long term.
Bigger picture is as Timing Belt describes.0 -
Interesting stats from the latest CSO report for march
Number FTB falling down 2.5%
77% of FTB purchases were for 2nd hand properties
Median price in Dublin approaching 400k
Looks like the investment funds have pushed FTB out of the new builds market.
We are starting to see why FF wanted shared ownership despite all the advise against
https://www.cso.ie/en/releasesandpublications/ep/p-rppi/residentialpropertypriceindexmarch2021/
Updated property price index shows a 0.7% increase nationally month on month from Feb to March.0 -
How about put tax on derelict properties and tax on vacant properties if more than 2 in possession as low hanging fruit?
Go ahead, increase the Revenue head count by 25%. More taxes and more civil servants - go for it - just what this country needs.
REITS are a huge problem but the discussion here has turned to inaccessible spaces above shops, and the like. Crazy. Deal with the elephant in the room, before worrying about the mice.
How many property owners have the funds necessary to do the renovations? if they all are forced to do it, assuming a magic amount of money, what would that do to the rental values? If they all had to borrow money to fund this nonsense, the rental yield could be insufficient to service borrowings. Not to mention the net effect of all this on Irelands currently minuscule level of debt.
Where are the workers coming from to do these soon to be white elephant property conversions? Where is the money coming from?
I have a property currently for sale, the prospective buyer has applied for a mortgage. So far it's been 5 months without it being granted yet.
You own a shop, which makes ends meet, but isn't a spectacular earner. The government drops a 10% tax on you for the inaccessible, uninsulated, unplumbed, old wiring, spaces above. You apply for a loan to do the conversion and the banks say no. Then what? Yeah, great if such small business owners go under, fire their one employee, and are forced to put their property on the market, along with the 12,000 others doing likewise at the same time, for the same reason. What a win for FTBers - the prices of uninhabitable commercial buildings falling through the floor.
The sheer impracticality and negative consequences of what people are proposing here at the moment just spin my head.0 -
2nd hand YoY growth swung by 3%, new by .4%
In one quarter second hand growth has caught up and passed new.
Would the theory be, a combination of the lack of new supply, and the price of new supply edging up making 2nd hand more attractive again?
Here you go, so high demands is not just for new houses, all sectors goes up. And WHF didn't removed demands for Dublin, prices going up here as well.
There are lack of properties across all sectors. Without increase in construction, or economic collapse, housing crisis will not be solved.0 -
Go ahead, increase the Revenue head count by 25%. More taxes and more civil servants - go for it - just what this country needs.
REITS are a huge problem but the discussion here has turned to inaccessible spaces above shops, and the like. Crazy. Deal with the elephant in the room, before worrying about the mice.
How many property owners have the funds necessary to do the renovations? if they all are forced to do it, assuming a magic amount of money, what would that do to the rental values? If they all had to borrow money to fund this nonsense, the rental yield could be insufficient to service borrowings. Not to mention the net effect of all this on Irelands currently minuscule level of debt.
Where are the workers coming from to do these soon to be white elephant property conversions? Where is the money coming from?
I have a property currently for sale, the prospective buyer has applied for a mortgage. So far it's been 5 months without it being granted yet.
You own a shop, which makes ends meet, but isn't a spectacular earner. The government drops a 10% tax on you for the inaccessible, uninsulated, unplumbed, old wiring, spaces above. You apply for a loan to do the conversion and the banks say no. Then what? Yeah, great if such small business owners go under, fire their one employee, and are forced to put their property on the market, along with the 12,000 others doing likewise at the same time, for the same reason. What a win for FTBers - the prices of uninhabitable commercial buildings falling through the floor.
The sheer impracticality and negative consequences of what people are proposing here at the moment just spin my head.
Agreed. The state has too much money. If it had less of it, it would be less able to cause the problems that it causes...0 -
MacronvFrugals wrote: »Its a paywall article but interesting to note the IMF are recommending we increase taxes
The IMF’s point man on Ireland on increasing taxes, fixing the housing crisis and helping SMEs survive the pandemic
https://t.co/P3HggrjrRH?amp=1
Oh great, those geniuses again.
https://www.irishtimes.com/business/economy/ireland/imf-distances-itself-from-comments-against-austerity-1.1358319The International Monetary Fund has distanced itself from comments by the fund’s former mission chief to Ireland, Ashoka Mody, who said complete reliance on austerity was not “a reasonable” way to go.
...
Speaking on RTɒs Morning Ireland yesterday morning, Mr Mody said the construct for Ireland’s rescue was wrong. “We are seeing a belated recognition of the fact that the constraint imposed only by austerity was untenable.
"Clearly the experience, if experience was needed, has demonstrated that reliance on austerity is counterproductive."
Earlier this year, Mr Mody said the legacy burdens of the crisis must be addressed.
“The alternative is unending human pain, a culture of national dependency and a fraying European economic and social fabric.”0 -
Go ahead, increase the Revenue head count by 25%. More taxes and more civil servants - go for it - just what this country needs.
REITS are a huge problem but the discussion here has turned to inaccessible spaces above shops, and the like. Crazy. Deal with the elephant in the room, before worrying about the mice.
How many property owners have the funds necessary to do the renovations? if they all are forced to do it, assuming a magic amount of money, what would that do to the rental values? If they all had to borrow money to fund this nonsense, the rental yield could be insufficient to service borrowings. Not to mention the net effect of all this on Irelands currently minuscule level of debt.
Where are the workers coming from to do these soon to be white elephant property conversions? Where is the money coming from?
I have a property currently for sale, the prospective buyer has applied for a mortgage. So far it's been 5 months without it being granted yet.
You own a shop, which makes ends meet, but isn't a spectacular earner. The government drops a 10% tax on you for the inaccessible, uninsulated, unplumbed, old wiring, spaces above. You apply for a loan to do the conversion and the banks say no. Then what? Yeah, great if such small business owners go under, fire their one employee, and are forced to put their property on the market, along with the 12,000 others doing likewise at the same time, for the same reason. What a win for FTBers - the prices of uninhabitable commercial buildings falling through the floor.
The sheer impracticality and negative consequences of what people are proposing here at the moment just spin my head.
Shops cannot be considered vacant so not libel for the vacancy tax. As well it is easy enough to class area above a shop as storage, faculties and office area. Finally most area's above shops need a lot of fire safety work to comply. That is why its important to incentive those with these premises to consider if it is practical to reconvert area's above these premises back into living accommodation.
The vacancy tax would be to stop hoarding of sites or vacant property. The present one is impractical to enforce. Bring in one that is collectable but rebate to encourage rapid development along with tax relief..
Carrot and stick have a better chance of working than a sledgehammer it easier on your hands as wellSlava Ukrainii
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Go ahead, increase the Revenue head count by 25%. More taxes and more civil servants - go for it - just what this country needs.
REITS are a huge problem but the discussion here has turned to inaccessible spaces above shops, and the like. Crazy. Deal with the elephant in the room, before worrying about the mice.
How many property owners have the funds necessary to do the renovations? if they all are forced to do it, assuming a magic amount of money, what would that do to the rental values? If they all had to borrow money to fund this nonsense, the rental yield could be insufficient to service borrowings. Not to mention the net effect of all this on Irelands currently minuscule level of debt.
Where are the workers coming from to do these soon to be white elephant property conversions? Where is the money coming from?
I have a property currently for sale, the prospective buyer has applied for a mortgage. So far it's been 5 months without it being granted yet.
You own a shop, which makes ends meet, but isn't a spectacular earner. The government drops a 10% tax on you for the inaccessible, uninsulated, unplumbed, old wiring, spaces above. You apply for a loan to do the conversion and the banks say no. Then what? Yeah, great if such small business owners go under, fire their one employee, and are forced to put their property on the market, along with the 12,000 others doing likewise at the same time, for the same reason. What a win for FTBers - the prices of uninhabitable commercial buildings falling through the floor.
The sheer impracticality and negative consequences of what people are proposing here at the moment just spin my head.
And who are the owners?
I would guess, in many cases, it's the funds who purchased c. €200 Billion in distressed Irish bank assets between 2012 and 2016.
The state can easily distinguish between a shop owner who actually does run a shop out of his own property and a fund. They can easily tax the fund owned under-used property which would have no impact on the small business property owner IMO0 -
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I was wondering if restrictions introduced in Ireland could be the breach in the dam, but in reality all a bust does is reveal the unsustainable practices of the preceding boom and these funds have being piling into markets everywhere.Amadan Dubh wrote: »If the government bans the entering into leases for 20/25 years by the councils and the institutionals have to try to draw €2k+ blood rents from the income tax payer stone, then I could see the "get rich quick" US investors starting to question the risk versus returns. The pension funds perhaps would just look to hold the asset and achieve some income over the long term.
Bigger picture is as Timing Belt describes.
I could be extremely wrong about this but pension funds tend to be passive, as in people aren't as engaged with the management of their pension fund as they would be with their weekly shopping bill.
In the last decade many pension funds have gone from 20% exposure to property to 50%, but at some stage all those funds corralling themselves into the same illiquid asset class will swamp the market. I'm just curious as to how this pileup will reveal itself.
I've had a self managing private pension before so I wonder if it will simply be members electing to cut their losses by recalibrating their pension away from property and more into cash.0 -
I just caught the end of a show on the radio there. Not sure if it was him, but did I just hear Darragh O'Brien suggesting that they increase stamp duty for everyone but FTBs to curb REITs?
I knew it wouldnt take them long to figure out how to gouge more money off ordinary workers, thinly veiled as helping them.
What about second time buyers? I hope he isnt intending on upping stamp duty for them too.
That guy is worse even than the housing ministers who came before.0 -
Amadan Dubh wrote: »The big question is how, in a housing crisis, can properties be left vacant rather than dropping rents until they are let?
The data on the state of the market indicates rents have decreased slightly over the last year in Dublin but are potentially starting to increase again in Dublin. However, due to the level of vacancies, it is quite obvious that the Daft report is not a complete picture of the state of the market. Do we potentially already have our ghost estates from the economic growth period from 2012?
The consensus seems to be, and apologies if I have this arseways, that the funds are calculating the on-paper valuation of these properties is going up so quickly that it outpaces whatever real cash they'd make by being rented out. So on on paper they make so much money every year just by being property and sitting around getting more valuable that the cash any actual tenants hand over is just lunch money on the side.
Bizarrely though, part of that valuation figure though takes the potential rent into the equation, rather than the occupancy, as a previous commentor noted. How much you can ostensibly charge for that unit every month affects the valuation of it, while how much you are actually getting in the real world doesn't. So an unoccupied unit for €2000 a month "makes" more in a year than one occupied for €1000 a month, because it will go up by more than 12k, and more than the 1k one next door.
And this is why their rents stay high, not because rents themselves are making the Reits rich, but because they expect such high on-paper rents to make their assets balloon in value year to year on the spreadsheet indefinitely. This is also why half empty developments are still finding new ways to staple on and sandwich in new units anywhere they can - because a new unit can have any rent they like thrown onto it for the sake of valuation, which is far more important to the investor report than filling the existing ghost block.
This is my understanding of what's happening in those developments based on chatter on here and Reddit. And there is an internally logical dynamic to it, just as there was internal logic in sending beef and wheat abroad during the famine. Its just absolutely ****ing insane from the outside, is all.0 -
jill_valentine wrote: »The consensus seems to be, and apologies if I have this arseways, that the funds are calculating the on-paper valuation of these properties is going up so quickly that it outpaces whatever real cash they'd make by being rented out. So on on paper they make so much money every year just by being property and sitting around getting more valuable that the cash any actual tenants hand over is just lunch money on the side.
Bizarrely though, part of that valuation figure though takes the potential rent into the equation, rather than the occupancy, as a previous commentor noted. How much you can ostensibly charge for that unit every month affects the valuation of it, while how much you are actually getting in the real world doesn't. So an unoccupied unit for €2000 a month "makes" more in a year than one occupied for €1000 a month, because it will go up by more than 12k, and more than the 1k one next door.
And this is why their rents stay high, not because rents themselves are making the Reits rich, but because they expect such high on-paper rents to make their assets balloon in value year to year on the spreadsheet indefinitely. This is also why half empty developments are still finding new ways to staple on and sandwich in new units anywhere they can - because a new unit can have any rent they like thrown onto it for the sake of valuation, which is far more important to the investor report than filling the existing ghost block.
This is my understanding of what's happening in those developments based on chatter on here and Reddit. And there is an internally logical dynamic to it, just as there was internal logic in sending beef and wheat abroad during the famine.
Another win for the accountants so (I'm an accountant). Fair value, market value, marked to market etc are all nonsense and lead to this sort of carry on.
Absolutely bonkers that people get so tied up in unrealised notional profits.0 -
I just caught the end of a show on the radio there. Not sure if it was him, but did I just hear Darragh O'Brien suggesting that they increase stamp duty for everyone but FTBs to curb REITs?
I knew it wouldnt take them long to figure out how to gouge more money off ordinary workers, thinly veiled as helping them.
What about second time buyers? I hope he isnt intending on upping stamp duty for them too.
That guy is worse even than the housing ministers who came before.
This was so nearly a good idea. Why not scrap the HTB scheme, shared equity etc. and make the increased stamp only apply to non PPR purchases (probably with an exception for LA/AHB which they'd insist).
Disadvantage all the REITs, foreign private investors etc. and just generally makes a statement that we support people living in Ireland buying houses to live in above all else. FTB, SSB, whatever. If it's a purchase for you to live in (house/apartment whatever) - we've got your back.0 -
PropQueries wrote: »And who are the owners?
I would guess, in many cases, it's the funds who purchased c. €200 Billion in distressed Irish bank assets between 2012 and 2016.
The state can easily distinguish between a shop owner who actually does run a shop out of his own property and a fund. They can easily tax the fund owned under-used property which would have no impact on the small business property owner IMO
The state has chosen not to tax funds as is, and you expect them to change that stance to suit your grand vision? The Irish state basically operates a cargo cult when it comes to large foreign enterprises and nonexistant taxation is the method they use as their version of runways cleared through the jungle to attract the big silver bird down from the sky with all it's goodies.
There is no such thing as 'easily' in Ireland, other than coming up with ideas for things that are not easy.0 -
I just caught the end of a show on the radio there. Not sure if it was him, but did I just hear Darragh O'Brien suggesting that they increase stamp duty for everyone but FTBs to curb REITs?
I knew it wouldnt take them long to figure out how to gouge more money off ordinary workers, thinly veiled as helping them.
What about second time buyers? I hope he isnt intending on upping stamp duty for them too.
That guy is worse even than the housing ministers who came before.
His background is in the pension industry, so I wouldn't be surprised if he's already got a vested interest in protecting them.0 -
jill_valentine wrote: »The consensus seems to be, and apologies if I have this arseways, that the funds are calculating the on-paper valuation of these properties is going up so quickly that it outpaces whatever real cash they'd make by being rented out. So on on paper they make so much money every year just by being property and sitting around getting more valuable that the cash any actual tenants hand over is just lunch money on the side.
Bizarrely though, part of that valuation figure though takes the potential rent into the equation, rather than the occupancy, as a previous commentor noted. How much you can ostensibly charge for that unit every month affects the valuation of it, while how much you are actually getting in the real world doesn't. So an unoccupied unit for €2000 a month "makes" more in a year than one occupied for €1000 a month, because it will go up by more than 12k, and more than the 1k one next door.
And this is why their rents stay high, not because rents themselves are making the Reits rich, but because they expect such high on-paper rents to make their assets balloon in value year to year on the spreadsheet indefinitely. This is also why half empty developments are still finding new ways to staple on and sandwich in new units anywhere they can - because a new unit can have any rent they like thrown onto it for the sake of valuation, which is far more important to the investor report than filling the existing ghost block.
This is my understanding of what's happening in those developments based on chatter on here and Reddit. And there is an internally logical dynamic to it, just as there was internal logic in sending beef and wheat abroad during the famine. Its just absolutely ****ing insane from the outside, is all.
Their main business and income is from actual Rental, they made much money even in the last 3 years, when property prices were stable, while they have plenty of expenses.0 -
Cilldara_2000 wrote: »Another win for the accountants so (I'm an accountant). Fair value, market value, marked to market etc are all nonsense and lead to this sort of carry on.
Absolutely bonkers that people get so tied up in unrealised notional profits.
It is, and I keep thinking of that documentary about Enron, Smartest Guys in the Room, when a load of people all over the US only discovered their pensions relied on Enron's performance when it blew up and took their retirements down with it. The figure in the pamphlet every year looked solid up until then, why would they look any deeper?
That was where I first heard the phrase "Mark to Market", too.0 -
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Home is where the city is
Mick Clifford Irish Examiner podcast
A study of dereliction focused on Cork City finds 340 derelict buildings within a 2 km radius in Cork
Worth a listen on your evening walk0
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