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

Blut2

https://www.boards.ie/discussion/comment/121522565#Comment_121522565

32k homes in 2023 is absolutely horrendous going given we're now multiple years into this housing crisis, the state in very recent history was building 90k houses a year, our population grew by 100k in 2022, and every analysis is now saying we need 50k+ houses a year. Its like a child coming home to you after years of getting straight 'F's saying "oh well at least its not an NG". We can absolutely do better if the state applies its resources even slightly more smartly.

FG and FF have been in government since 2011. Through the last almost 13 years in power they've made an absolute disaster of housing in Ireland. SF and the other opposition parties have promised to build vastly more houses, and have laid out plans to do so in their manifestos. They may not be able to achieve this fully in government, but at the very least they have plans to try so won't do any worse.

Jizique

https://www.boards.ie/discussion/comment/121522896#Comment_121522896

32k homes at full employment is ok, who will build all these extra homes you want and where will they be built?

byrne249

https://www.boards.ie/discussion/comment/121522896#Comment_121522896

This is it. Anyone who thinks they can do worse is smoking the kool aid.

And when do those of us who predicted 0% change in house prices get to pat ourselves on the back and give a giant well done(for accuracy if not precision)!??

Just dropped back in to the thread briefly and still seeing people comparing us to the UK? Does comparing Ireland to 1 or even all 195 countries in the world prove anything about our market. Baffling repetitive nonsense.

On second thought, I would give someone credit if they did a cost analysis of 195 countries and their fiscal housing operations over the last decade, and compare to us.

Now what happens if the central bank decides to loosen lending rules again? Now there's a scary thought. Maybe 4x lending capacity for 2nd time buyers in 2024? I could see it in the endless sea of clowns and collaborators. Can't wait to see the Central banks cut rates 0.5% only to wring almightly inflation down upon us all and furiously raise them again much further than they otherwise would have done. Maybe then people will realise none of these people have a clue what they are doing?? That's my prediction(Sorry if there's a prediction thread somewhere?)

SharkMX

We've been looking for a while now and they are going up as far as i can see. Id love if they were going down.

Id prefer if the ECB didnt reduce rates until I have bought somewhere to live though :)

When they reduce them i fear its up, up and away for prices.

Blut2

https://www.boards.ie/discussion/comment/121522911#Comment_121522911

How is 32k homes "ok" when we would have needed to build 35k homes to house our 100k population increase in 2022? Nevermind replacing old housing stock, or actually expanding our housing stock.

Our housing crisis literally worsened to the tune of a deficit of 3000+ houses in 2022, it didn't get better at all. Thats absolutely horrendous going years into the housing crisis, at a time when the state is awash in cash.

There are multiple ways to get extra houses built at a time of full employment, that have been discussed at length in this thread. Diverting the construction resources used in the last few years on offices/hotels to housing would have been the most immediate/obvious. Ramping up our apprentice and retraining programs, if begun 5 years ago, would be paying off now - but theres no reason to not start this tomorrow, the sooner the better. Or the more difficult, but still achievable one would have been to import builders, house them in temporary accomodation (of the sort being used for Ukrainians), and put them to work.

Villa05

Possibly where the 300k figure comes from

https://twitter.com/colmhealy/status/1737890964515983616?t=vBu0Bdd1zFGlelUhtONN3Q&s=19

The interview

https://www.rte.ie/radio/radio1/clips/22336645/

RichardAnd

https://www.boards.ie/discussion/comment/121522896#Comment_121522896

Hmm true, but the 80-90k houses and apartments build back in the celtic tiger days was possible because a huge chunk of the economy was aimed solely at keeping a Ponzi scheme on the go. Also, the quality of many of those houses was questionable at, to say the least. One would hope that modern builds are better, but we'll see in twenty years.

It's my sincere opinion that the only thing that will "fix" the housing crisis a severe and lasting economic downturn. Such an event would render the state broke, and thus unable to directly interfere in the market, reduce the population through emigration and take a lot of cash and credit out of the system. I don't WANT for that to happen, but as this has persisted for years without any real action or even honesty about the causes of the problem, I don't any other means of change.

PommieBast

@RichardAnd

It's my sincere opinion that the only thing that will "fix" the housing crisis a severe and lasting economic downturn. Such an event would render the state broke, and thus unable to directly interfere in the market, reduce the population through emigration and take a lot of cash and credit out of the system. I don't WANT for that to happen, but as this has persisted for years without any real action or even honesty about the causes of the problem, I don't any other means of change.

Think it was back in 2021 when I posted here tongue-in-cheek about deliberately crashing the economy being the most expedient way of sorting out housing.

SharkMX

https://www.boards.ie/discussion/comment/121525433#Comment_121525433

Dont know about that. If the economy tanks that bad watch them increase property tax, income tax, another special tax on second homes, raid pensions again, reduce social welfare and so on. A crash never has only the casualties people want.

RichardAnd

https://www.boards.ie/discussion/comment/121525590#Comment_121525590

No doubt about it. It would be like saving a wheat field from a rat infestation by setting fire to it.

My point is that the state, or at least the ruling class that currently holds the reins, has demonstrated that there is no desire whatsoever to resolve the housing crisis, quite the opposite. I'm also not under any real illusion that SF or any other party would really do anything differently.

The Student

https://www.boards.ie/discussion/comment/121518793#Comment_121518793

We don't take the hard decisions nor are they fair. Simple example is road tax why not impose the charge on the price of fuel the more you use the roads the more you pay. With businesses fuel costs are an expense so can be deducted accordingly.

Look at property tax as another example similar sized houses with 20 mins of each other are charged different rates based solely on the value of the property. Why are two houses with access to exactly the same amenities etc charged different rates they are not consuming more street lights than the other, they don't have better footpaths etc.

RichardAnd

https://www.boards.ie/discussion/comment/121526066#Comment_121526066

Hmm, I would rather that the state would simply spend less and thus need less tax. I suppose it's a small piece of the dying libertarian in me....

The Student

https://www.boards.ie/discussion/comment/121526200#Comment_121526200

Spending less does not equal votes. Its easy to spend someone else's money when they don't have any choice in how its spent. Without turning this into a political discussion we are going to far to the left in politics.

To bring this back on topic if we as a society actually made people take some responsibility for their decisions maybe some people would think twice before making some decisions knowing they have to live with the consequences rather than the rest of us have to.

Dav010

Am I really reading that posters think a Government should deliberately crash an economy, to make housing more affordable, for those who can’t buy?

Have we really reached that point of detachment from reality?

Villa05

https://www.boards.ie/discussion/comment/121526066#Comment_121526066

More than half the price of fuel is tax

Property tax proposed by the imf was envisaged as a wealth tax and inhibitor to runaway house price growth.

I suspect our property taxes are amongst the lowest in the world and come nowhere near covering the associated state costs

RichardAnd

https://www.boards.ie/discussion/comment/121526540#Comment_121526540

Agreed on both points.

Timing belt

https://www.boards.ie/discussion/comment/121526694#Comment_121526694

Property tax applied correctly encourages older people to downsize etc but it’s would be political suicide and as such nearly all political parties are not in favour with SF being the strongest opponent

fartooreasonable

https://www.boards.ie/discussion/comment/121526652#Comment_121526652

As opposed to the situation we are in now where there is a large number of people who cannot buy and are locked in renting long term which will sooner or later have the same impact on the economy.

Its the choice between two bad options, on the one hand continue the status quo and eventually this country becomes uncompetitive and on the other hand accept that some people will lose out (but likely not go homeless) and there is at least a hope that the future can be more sustainable.

To give a personal example I'm currently earning a very good wage in a rural area of Ireland and cannot buy due to there being absolutely no houses that aren't terrible quality due to a combination of the current housing market and defective blocks, and I am not the only one in this position. The idea that making houses more affordable will destroy everything implies that the current system is sustainable which clearly isn't the case.

Dav010

https://www.boards.ie/discussion/comment/121526858#Comment_121526858

So you think the whole economy should be plunged into crisis, so you can buy a house?

What makes you think you will be unaffected by an economic crash?

PommieBast

https://www.boards.ie/discussion/comment/121526652#Comment_121526652

None of us think it should be done. In my case it was a clear joke that was aimed at those who insist the solution to making housing cheaper is demand-side rather than supply-side.

Timing belt

https://www.boards.ie/discussion/comment/121526874#Comment_121526874

People don’t understand the reality or have been lucky to have not been impacted in the previous downturns and as a result think they are immune and forget that there deposit they have saved will be meaningless unless they can buy 100% with cash if they loose there job etc. And even if they could buy with cash would they be able to pay the bills to run a house.

Villa05

https://www.boards.ie/discussion/comment/121526874#Comment_121526874

With respect to ireland, making housing unaffordable is the quickest way to crashing the economy

The Student

https://www.boards.ie/discussion/comment/121526694#Comment_121526694

Road tax is a crude taxing method (ironically the vast majority of which does not go to the road network).

Property tax is based on the value of your property (if you extend your house for your own comfort/increasing family size) your are liable for the band your house value relates to. You did not increase the size of your house as an investment opportunity, you did it out of necessity. How is it fair then you should have to pay more property tax?

Did you get an extra street light outside your house? Were flowers planted by your council to offset some of the increase in tax?

While the above may sound silly remember the State through inheritance tax still get their cut of your estate. Albeit they need to wait till you pass but as housing values increase so does the tax take for Revenue.

fartooreasonable

https://www.boards.ie/discussion/comment/121526874#Comment_121526874

In that statement you are implying that what we are doing now will maintain economic health for the future. Given the falling home ownership rates in the younger popualations and lackluster attempts to correct it this country appears to be becoming less competitive internationally. This is already leading to brain drain in some sectors.

Of course I am biased in wanting to own a house, you are likely a home owner (I assume) so you are biased in the opposite direction. The only difference is reducing house prices likely won't leave you homeless which maintining what is happening now will do.

I work in the medical field, given a crash I'm unlikely to be affected in a large way. However multiple of my colleagues have had to move abroad all taking their education with them. My cousins consisting of a doctor, optomitrist and pharmacist are all in Australia with their education funded by the tax payer, they all got paid substantially and it just isn't enough.

Regardless of what decision is made there will be winners and losers but implying that what is happening now is sustainable isn't correct.

timmyntc

https://www.boards.ie/discussion/comment/121527002#Comment_121527002

You are thinking of council tax which in other countries is used to fund council services such as lighting, water, sewage, amenities etc. There is no such tax in ireland.

Local property tax is not the same.

Dav010

https://www.boards.ie/discussion/comment/121527015#Comment_121527015

I work in the health sector as well, again, what makes you think a bank would lend to you if the economy tanks?

If you work for the HSE, of course you will be affected, anyone who worked in healthcare/PS were not immune during the last recession.

fartooreasonable

https://www.boards.ie/discussion/comment/121527097#Comment_121527097

So given the status quo I likely won't be able to buy a house and if everything crashes I cannot buy a house, that's not a choice so why would it affect me. You'll find many more earning less than me feeling the same way at present and removing choice makes people make different decisions.

Secondly I need to provide a 30% deposit at present as a first time buyer (it's a long story I won't go into). I have that saved for the places I'm bidding on and yet still cannot buy a house so I fail to see how things could get worse for me.

This is why where we are now isn't sustainable.

Dav010

https://www.boards.ie/discussion/comment/121527132#Comment_121527132

The economy cashing isn’t going to help you just because as a healthcare worker you think it won’t affect you. All of my family work in healthcare and lived through the last recession, some are in the UK for professional and economic reasons, if any of them said they wanted an economic crash just so they could buy a house, I would despair at what I raised.

Donald Trump

https://www.boards.ie/discussion/comment/121527019#Comment_121527019

But Ireland did have a system of taxation based off rates on property ownership up until not that long ago. I mean not in my time, but definitely within my father and grandfathers time. It kept the price of property low..............my own grandfather sold a decent block of land and the story is that it was because the rates on it were just too high and more than he was able to make on it. But that obviously also affected the price of what someone was willing to pay for it. So it went for what would be now considered very cheap (I mean scaling up relative to today's prices). If it was to be sold today, I wouldn't be confident of it going for less than 750k.........I'm probably going back 60-70 years with that now in fairness.

Moving to a predominantly income-based system of taxation does have advantages, but it does shift a huge portion of the burden that would have been on the most wealthy - that being the property owners. And it inflates the value of that property too.

fartooreasonable

https://www.boards.ie/discussion/comment/121527151#Comment_121527151

Well I didn't say I wanted an economic crash and I'm curious to see why you think a reduction in house price alone would cause an economic crash. From reading I can't see any article stating it would happen unless you've one.