Irish Property Market chat II - *read mod note post #1 before posting*

combat14

https://www.boards.ie/discussion/comment/120207773#Comment_120207773

at the same time if funds are found in any way to be colluding to set rental prices that could open a while other can of worms but realistically a discussion for another day

coolshannagh28

https://www.boards.ie/discussion/comment/120207555#Comment_120207555

Penny is dropping , the funds are controlling the market by ownership of the properties in play ie buying a high % of what comes on the market and setting rent thereafter . The govt has backed the funds via tax incentives after initially being coerced into this by the troika who wished to see a more European rental model for Ireland , we have taken a uniquely Irish approach to this by adopting a US freemarket capital model . We have benefited from this by a huge influx of capital and the quid pro quo of MNC tech investment and also by outsourcing the risk inherent in our deeply cyclical property market. Our high level of immigration feeds the demand for property driving up prices and rents which pleases the investors and the govt and gives mom and pop landlords the chance to exit and wash their faces. Interestingly left wing groups are also happy that we are offering succour to refugees and migrants so everyone benefits ....but the natives are starting to growl setting up a quandry for both govt and opposition .

Villa05

https://www.boards.ie/discussion/comment/120207817#Comment_120207817

Have heard that these investment funds use software to maximise rental income, would imagine that the funds are using similar/same software so in effect its collusion

Was on a podcast will dig it out if anyine is intrested

Timing belt

https://www.boards.ie/discussion/comment/120207884#Comment_120207884

Software is only as good as assumptions and inputs. Unless all funds are using the same assumptions and inputs only then would it be collusion.

its not that complicated that it even needs software. A simple model that captures demand, supply and disposable income is all that is required. A simple spreadsheet would work it out but saying that I suspect most wouldn’t even bother with this and will just use a simple calc of we need a yield of x so we need to set rent at anything above y

J_1980

https://www.boards.ie/discussion/comment/120207129#Comment_120207129

Wonder if the AHB are also part of these “property investors”.

to my knowledge funds aren’t buying 2nd hand properties.

Villa05

https://www.boards.ie/discussion/comment/120208166#Comment_120208166

With regard to funds: They are, far more than they are building

Since 2012, investors have leaned towards acquiring existing property as opposed to delivering new homes, despite government incentives for investors aimed at generating new supply. Daly said investors acquired around 13,500 homes and delivered 12,500 units.

Daly, who presented his findings to the SSISI in January, said investment in residential property as a portion of overall property investment had increased “dramatically”, with a “significant shift towards residential housing” since 2018

He showed that Ires Reit, the largest landlord in the state with 4,201 units, had bought 3,461 of these units second-hand and built 740 units. Kennedy Wilson, the US landlord, has a portfolio of 2,323 units, of which it acquired 1,735 second hand

lordleitrim

3 properties in my area of Dublin 15 that have been stuck on Daft for months have been updated on Daft with new asking prices 15k and 20k below what they were as they were not attracting interest. This time last year similar properties in the same neighbourhood were on and off Daft in less than a month with PPR showing closing sale prices up to 40K more than the asking price.

Definitely a market shift going on....the real estate agents just don't want to publicise it....

Donald Trump

https://www.boards.ie/discussion/comment/120207068#Comment_120207068

I missed this earlier. You clearly don't understand the basics Bass.

In this case the owner is selling a property. The buyer is handing over money in return. (The analogy I gave to make it easier is you going to a shop to buy something.). Here the vendor is offering some sort of finance. (Again, the analogy is the shop owner offering in-store credit). Regardless of that, the point I tried to make, as basically as possible, is that you buying something in the shop is not the same as you buying a share in the shop. Timing belt said (incorrectly) that the analogy is between you buying a share in the shop business versus you giving the shop a loan. That is not the correct analogy. At no stage here is the potential buyer of that property giving the seller a loan. The buyer is not acquiring a share in the seller. The seller is also not trying to acquire a share in the buyer. How do we know the latter? Well because the buyer has not been identified and there is nothing in the advertisement to say that that is what they want.

In case you are still confused, let me explain it in a different way. Basswaffle Ltd wants to buy a property. A different party says they will give Basswaffle Ltd a loan of 10m to buy the property, or else buy a 10m share of Basswaffle Ltd. which Basswaffle can use to buy the property. That is the analogy that Timing Belt is talking about. The latter would be a PE transaction. (In this example, the different party happens to be the vendor, but don't get hung up on that).

It is fairly ironic to be calling other's stupid when you don't appear to know what is being talked about. Feel free to go off on some irrelevant tangent rant. Tell us another anecdote about Eddie Hobbs again while you are at it.

herbalplants

Dell to cut 5% of workforce worldwide as PC demand falls.

Timing belt

https://www.boards.ie/discussion/comment/120208500#Comment_120208500

your talking crap the PE funds don’t just buy an equity share….the also buy properties and issue debt. The way that they would provide finance is by issuing a loan note. For someone who claims to have 10 years experience you show the same level of knowledge as a intern.

J_1980

https://www.boards.ie/discussion/comment/120208266#Comment_120208266

Yes but does buying a full block off a developer count as “second hand” or self building (ie ordering someone to build something).

“2nd hand” to me is buying something off another landlord or owner, not a completed development off builder.

Timing belt

https://www.boards.ie/discussion/comment/120208266#Comment_120208266

Of course they are just look at the cso data on non household transactions which will include housing bodies and institutional investors. If you then look at the split on residency and NACE code you can see a clear correlation with an increase in house prices. One thing I would point out is that the funds activity in the Irish property market is a wide umbrella which include:

a fund providing finance to developers (much needed as banks wouldn’t lend directly)

funds that trade debt that is secured on property (needed so that banks didn’t need more capital injections from the government)

funds that BTR

funds that purchase property

Donald Trump

https://www.boards.ie/discussion/comment/120208652#Comment_120208652

The clue is in the name. Private. Equity. Transaction.

If you don't understand that, then you are better off leaving be rather than ranting.

Timing belt

yet again you show you know F all…maybe try taking to someone that works in the funds industry. PE funds cover a lot more than equity…. you’re actually clueless

newmember2

https://www.boards.ie/discussion/comment/120208802#Comment_120208802

You're worse, arguing with him.

Dav010

https://www.boards.ie/discussion/comment/120208802#Comment_120208802

Don’t follow the rabbit down the hole.

Donald Trump

https://www.boards.ie/discussion/comment/120208802#Comment_120208802

I don't care any more. I'm not wasting time explaining basics to you. Go and ask your own little back-office buddies if you want.

Zenify

Anybody else noticing properties requiring work staying on the market longer compared to last year? A few I've been watching haven't budged. Would like to know what others have experienced and what area?

J_1980

https://www.boards.ie/discussion/comment/120209545#Comment_120209545

Yes seeing the same. Things like this:

https://offr.io/property/81-trimleston-gardens-booterstown-co-dublin-a94-hd45-ie/5253

Though newbuilds with really small gardens are also sticky.

oddly people are still picking up nice looking E rated houses though.

Zenify

I can't believe there are still green bathrooms hanging around... initially I was going to say that doesn't need that much work but then I realised its just the photography.

Bass Reeves

https://www.boards.ie/discussion/comment/120210499#Comment_120210499

Older people are often reluctant to spend money on replacing something that while dated in colour or design may be still functional.

You can still wash, go to the toilet and have a bath there.

realitykeeper

I think it is fair to say the government does not want property prices to fall. So is the sale of Irish passports to wealthy foreign nationals one of their strategies to keep house prices high?

If a lot of young Irish professionals choose to emigrate rather than pay high rent (or take on an inflated mortgage) will the government try to bridge the gap by selling 100,000 Irish passports to wealthy Chinese who are willing to buy houses here?

rob316

https://www.boards.ie/discussion/comment/120210669#Comment_120210669

They want to keep it high but "affordable", they still haven't figure out that you can't have both.

quokula

https://www.boards.ie/discussion/comment/120210681#Comment_120210681

You can keep it stable while wages rise with inflation.

For the government to intervene and try to cause a crash would be a disaster for a great many people, as much as those who haven't saved for a deposit want it to happen.

rob316

Oh look the housing minister has another solution to the supply problem today. Increasing Local authority loans and house price ceiling limits! Yippee more buyers for a tiny pool of houses.

Ozark707

https://www.boards.ie/discussion/comment/120210921#Comment_120210921

Why not indeed, sure what could go wrong with such a policy

tanko

https://www.boards.ie/discussion/comment/120197377#Comment_120197377

Yeah i’m sure that the likes of Micheal Martin and Eamon Ryan will look after the Irish economy just like they did in 2008. Sure those lads have an unlimited understanding of economics, it’ll be grand. It’s only fifteen years since we were bankrupt, you have a short memory.

rob316

https://www.boards.ie/discussion/comment/120211010#Comment_120211010

who needs to focus on the economic conditions when you have a government who's only consistent policy is increase demand. There is nothing out there, I haven't seen a 3 bed new build come on the market in Cork city since last October.

PommieBast

https://www.boards.ie/discussion/comment/120210669#Comment_120210669

Selling of passports is a nice little earner that pretty much everyone does these days, so I doubt it is specifically about property prices. Squeezing supply has already been pretty successful in reinflating the Celtic bubble.

Villa05

https://www.boards.ie/discussion/comment/120210819#Comment_120210819

Equally for the government to intervene to cause a bubble would be a disaster for all people and the economy.

We would be a great country if we were as focused on the upside risk as we are on the downside