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

combat14

https://www.boards.ie/discussion/comment/121547484#Comment_121547484

and the chickens will come home to roost when many of the 40/50s generation with no pension and no hope of buying can nolonger afford their rent

fartooreasonable

https://www.boards.ie/discussion/comment/121547921#Comment_121547921

Additionally those with pensions and houses at that point in the previous generation will be in their 60s and 70s at that point. Their skills usefulness degraded and will be much more vulnerable to policial changes which will likely occur with such a scenario.

Donald Trump

https://www.boards.ie/discussion/comment/121547129#Comment_121547129

How much of a loss did you actually realise?

RichardAnd

https://www.boards.ie/discussion/comment/121547921#Comment_121547921

True, though if I were in my 60s or early 70s now, I wouldn't be feeling too confident that the pension promised by the state will be there in the future.

Padre_Pio

https://www.boards.ie/discussion/comment/121547296#Comment_121547296

While I agree with you, that's a very weird statistic.

18-35 is an incredibly broad age range. Chances are that few aged 18-25 owned property in 2004. It was the case between 2011 and 2022.

So if you said people aged 26-34 who live in a property they own has gone from 60% in 2004 to 27% in 2019, the statistic would probably hold true.

But then it paints a less dramatic picture.

Check out fig 3.2

https://www.cso.ie/en/releasesandpublications/ep/p-cpp2/censusofpopulation2022profile2-housinginireland/homeownershipandrent/

What we're seeing is the average age of homeowners getting older by maybe 5 years or so.

Those who owned property by 25 pre-2011 are probably 30 before they're on the ladder now, and so on.

Buut... by 40-45 it's pretty much the same. Now, maybe those who bought at 25 had paid off a mortage in 15 years (unlikely)

I would say if your statistic was 18-40, instead of 18-35 then it would be a lot less shocking.

Bass Reeves

https://www.boards.ie/discussion/comment/121547484#Comment_121547484

So its always someone elses fault. There was a substantial porportion of people who taught from 2010-2016 that renting would always be afordable and house buying would always be easy. When prices started to climb from 2014 on they expected a double dip after then we got the expectation of a crash during and post Covid.

Its only now the penny is dropping. But the standard and specification of housing expectations are still quite substantial, a substantial number of buyers have plans to buy to the limit of what they can afford. It was always the way. Single people still want a three bed semiD. Many want a new A rated house with the Audi parked outside and probably in D4 as well

Former Former Former

https://www.boards.ie/discussion/comment/121548181#Comment_121548181

Sold the house for 80k less than I paid for it, 13 years after buying it and having put a fair bit into renovating and extending it, so total loss probably the guts of 150k.

That “should” have been a sizeable chunk of equity for my next house but it didn’t turn out that way, so I’ll be paying a larger mortgage for longer, retiring later and being less comfortable when I do retire. Lots of people in my age bracket will tell you a similar story. It is what it is.

The repeated assertion that the current crop of young people are being shafted by their greedy predecessors is a load of bollocks. We have all gone through huge challenges and thinking otherwise is exactly why the word “snowflake” gets thrown around so much.

The problems with housing are so complex and have been building for so long - and are in no way unique to Ireland - that there simply isn’t a quick fix, it will take years to resolve.

RichardAnd

https://www.boards.ie/discussion/comment/121549433#Comment_121549433

"So its always someone elses fault."

No, it isn't. That's not what I said, and if it was what you understood from my post, then I was unclear. Apologies. Whilst I dearly wish that I'd bought a few years earlier, I will be finished paying the mortgage that I do have in 4-5 years with no hiccups. All in all, it's not too bad.

Let's be clear about one thing, the enormous rise in property prices and in rents was not just something that happened. It was the result of deliberate policies by the state in inflate property, and Michael Noonan himself famously (or infamously) said this. This may well have benefited a sizable number of people, but it is going have serious long-term effects on Ireland, and we don't know what that will be.

If I were a young man faced with dismal hope of owning a home and settling down through no fault of my own, I'd be rather upset.

Blut2

https://www.boards.ie/discussion/comment/121548670#Comment_121548670

? did you read my original post on the last page? I quote from it directly:

"Research by the Economic and Social Research Institute (ESRI) found that the share of 25-34 year olds who own their own home more than halved between 2004 and 2019, falling from 60 per cent to just 27 per cent."

That aside, the average age of FTBs is increasing (with lots of negative consequences) yes, but "by 40-45 it's pretty much the same" is absolutely not true.

These are the figures for the overall home ownership rate in Ireland over the last 20 years:

2002 = 77.4%

2006 = 74.7%

2011 = 69.7%

2016 = 67.6%

2022 = 66%

Theres a continual drop, driven by older home owners dying off and younger people being unable to become home owners. Fewer and fewer people as a percentage of the population are able to buy their own home.

Once that figure hits below 50% things are going to get interesting - a democratic country where the majority of people are renters will likely start to radically/heavily tax home owners.

Villa05

https://www.boards.ie/discussion/comment/121546940#Comment_121546940

Absolute nonsense - population has increased by 11% (4.5m to 5m) since records on FTBers began in 2014. Number of first time buyers over the same period are up 120%. (16k to 34k)

Population has crept up. FTBer numbers have exploded

We were dishing out up to 25k+ work permits to non eea workers plus migration from within the EU in that 9 year period, most requiring an immediate housing need. Moving from 16k first time buyers to 36k may well be deterioration in the overall picture

Padre_Pio

https://www.boards.ie/discussion/comment/121549934#Comment_121549934

I agree with you, I'm saying you are inferring meaning to the statistics that may not be there.

Take your statistic here, 8% drop to 2002-2011 years, 4% drop 2012-2022. You're assuming that everyone wants to buy a house, which may not be true of the population

The 4% in the past 10 years is not bad considering the massive inward migration of people who may not be interested in buying a house.

Dav010

https://www.boards.ie/discussion/comment/121549901#Comment_121549901

I could be wrong, but didn’t Noonan say that during/towards the end of the recession when property prices had fallen off a cliff and many were in negative equity? Also, with a recovery in price, there was never going to be any development of new houses.

I wonder how many 30 somethings have sat on their holes over the last 7-8 years waiting for property prices to drop instead of buying. And now complain that they are priced out of the market.

Bass Reeves

https://www.boards.ie/discussion/comment/121549901#Comment_121549901

People harp back to what Micheal Noonan said. It was 2014.

https://m.independent.ie/irish-news/theres-no-housing-bubble-michael-noonan-wants-prices-to-rise/30168455.html

House prices were 47% off peak prices. Builders were not building. If prices has risen earlier maybe we would have 30-50k more houses build now.

RichardAnd

https://www.boards.ie/discussion/comment/121550011#Comment_121550011

He said it in 2014, just before prices began to climb again.

Look we can go around in circles about this. The reality of the situation is that the state implemented policies that has made accommodation hugely expensive and priced many tens of thousands of people out of ever owning a home. This, in turn, has likely scuppered their chances of settling down in life, because it's rather hard to settle when you live with your parents in your 30s. Should these people have bought years ago? Absolutely, but many of them couldn't and even if they could, we're not talking about buying bitcoin when it was work 100 euro a "coin". Without being too dramatic, these people were thrown to the wolves to reinflate a property market for the sake of short-term gain.

Maybe I'm wrong to care. After all, I do own a home as I've said, but I genuinely am hugely concerned about the future of this country. I don't think we're going to agree here, but I respect that your views differ from my own.

Padre_Pio

https://www.boards.ie/discussion/comment/121550097#Comment_121550097

"Priced tens of thousands of people out of ever owning a home"

Ever?

In the last 15 years we've had a boom, a bust and a boom. Even now as 30k homes are built a year, every one of them is being snapped up.

Most aren't buying because of affordability, they're not buying because of limited supply.

There's a lot of dramatics on this thread. I'm in full agreement the housing market is rigged to keep prices high, but it's not true to say that people can't buy homes.

The property market wasnt as bad 5 years ago, things were pricey but affordable. If people are feeling pressure because they're hitting 40 now and can't get a 30 year mortgage then why weren't they buying at 35, or 30?

Dav010

https://www.boards.ie/discussion/comment/121550122#Comment_121550122

Absolutely agree, it’s a form of non-buyers remorse.

Donald Trump

https://www.boards.ie/discussion/comment/121549726#Comment_121549726

Would you not think that your new house might also have been cheaper than it would have been 13 years previously? A crash is prices might have brought the new place into your range, where it might not have been had all prices doubled instead

If you buy something, live in it for 13 years and sell it for less than you bought it, well you count count every penny as a "loss" either.

Villa05

https://www.boards.ie/discussion/comment/121550097#Comment_121550097

Maybe I'm wrong to care. After all, I do own a home as I've said, but I genuinely am hugely concerned about the future of this country. I don't think we're going to agree here, but I respect that your views differ from my own

Nail/head

Buying a home is the longest term investment for the majority of purchasers. It'll be with you till the end. It's in all owners/renters/buyers/sellers to have a sustainable market always

Only speculators are served by the existing market

fartooreasonable

https://www.boards.ie/discussion/comment/121549433#Comment_121549433

Yes it is someone else's fault as the individual doesn't control the market and there's been a shift in the ability to purchase due to various factors. No matter where you place blame the buck has to lie somewhere. In my job I cannot just go whoopsy doopsy and that's it and neither should society about something as fundamental as housing.

Blut2

https://www.boards.ie/discussion/comment/121549961#Comment_121549961

A drop of home ownership rate in the age cohort from 60% to 27% doesn't require me to infer any meaning, the horrific figures speak for themselves.

The vast majority of people would rather own their home rather than rent it. Particularly those in that said cohort that previously would have owned their own property.

The idea that home ownership rates for these people have almost halved because people "people may not be interested in buying houses" is pretty incredibly distorted logic. You have heard of the current, ongoing, worst in the history of the Irish state housing crisis right?

Theres a reason every poll shows housing as the #1 issue for Irish voters, and its not because hundreds of thousands of people have made a happy choice to rent for their whole lives.

Padre_Pio

https://www.boards.ie/discussion/comment/121550402#Comment_121550402

2002 and 2022 are very different times.

Housing has changed, the population has changed, the demographics have changed and the peculiar statistic you keep mentioning doesn't show the full picture.

For example, there has been a 20% increase in the number of third level graduates in the past 20 years, meaning most people enter the workforce later and buy houses later.

I'm not disputing that a drop in home ownership is bad, it is very bad, but the housing crisis isn't the only factor here

Even your own statistic shows a drop in ownership when prices halved during the recession, and years of affordable housing.

fartooreasonable

https://www.boards.ie/discussion/comment/121550538#Comment_121550538

Delaying your first job for college for about 4 years shouldn't lead to that level of delay and decrease in home ownership. That seems be very disproportionate to college attendance.

Bass Reeves

https://www.boards.ie/discussion/comment/121550587#Comment_121550587

That is economic illiteracy so a 22-24 ye0ar old has the same economic power as someone 20 years ago that was 4-6 years in the workforces or some one 30+ years ago that was 8+ years in the workforce.

Former Former Former

https://www.boards.ie/discussion/comment/121550295#Comment_121550295

I didn’t count every penny as a loss. If you make capital investment in something and don’t recoup your money, it’s fair to call that a loss. Maintenance and upkeep, no.

I’m not complaining btw. I’m in a pretty good situation overall, I have a large house in a nice suburb of Dublin. Lots of people who bought in the boom didn’t fare as well. But the only way forward for me was to cut back my expenditure, save my money and keep doing that for many years. There’s no one on this thread to whom this advice can’t apply. Getting angry at “boomers” or other ridiculous inventions might make them feel better but it won’t help their situation.

The point is

a) every generation has had challenges in home ownership.

b) the idea of resenting and blaming other generations for the current situation is deeply unhelpful and can’t end well. It’s self pity and deflection, nothing more.

Padre_Pio

https://www.boards.ie/discussion/comment/121550587#Comment_121550587

It's one of many potential reasons the demographic may change over 20 years.

62% of leaving certs do a third level degree, and 35% of those do some post grad work. Thousands of graduates take a year or two travelling or working abroad.

That's tens of thousands of people each year who don't even enter the Irish workforce till they're in their mid 20s and can't even start the mortgage process until their late 20s (if they have the wages after 2 years to afford it)

So it's not hard to see how the 18-35 statistic gets a little skewed. Add in the huge number of migrants who can't access mortgages either for a few years (and maybe don't want to buy a house anyways) and the number gets depressed even further.

Add in the housing crisis too.

Also question why there was an 8% drop between 2002 and 2011, a time where more houses were built than ever, and we had a boom and bust.

fartooreasonable

https://www.boards.ie/discussion/comment/121550688#Comment_121550688

So not 4 years but 6 or 7 till their mid twenties. Again doesn't seem like a proportional for the issues we are facing now. Certainly between 2002 and 2011 for a long period prices rose dramatically and wages didn't so that might explain things such as has happened in the last few years. Either way doesn't seem sustainable in the long term.

In relation to your comment on migrants skewing the figures on those renting, when taken alongside figures on younger people having difficulties getting sufficient mortgage offers alongside the fact that housing is one of if not the biggest political issue in the state right now it paints an entirely different figure. Statistics cannot be viewed in isolation but when multiple come together to show the same underlying point it should not be ignored.

Donald Trump

https://www.boards.ie/discussion/comment/121550687#Comment_121550687

You transferred your ownership of property from one physical structure to another. You still benefited from the subsequent uplift. You just happened to transfer your capital at a low point (which would have likely benefited you as long as you otherwise had the correct ratios). There is nothing wrong with any of that - I just wouldn't be giving it the poor mouth and comparing it to someone today trying to get on the ladder.

There are a lot of "boomers" on here, at the tail end of their careers, condescending towards younger people along the lines of "give up the avocados and you could have a house the same as a genius hard worker like me". Well the question I would put to those is whether their annual salary from working is more than 20% of the value of their house.

What is the relevance of that question? Well, for a 30 year old to buy your house, they might aim for a 20% deposit and then a mortgage of 4X salary on the rest (80%). If a genius 55 year old boomer doesn't earn enough to do it.....then how on earth are they expecting the lazy 30 year old avocado muncher to be earning enough to do it? There will be some that upgraded along the way, but I'd say the majority are in houses that they bought 20+ years ago on a junior wage, and which they couldn't afford today on a senior wage. Again, there is nothing wrong with that, but the self-smugness and delusions that it is due to only their hard work is not quite correct.

And btw, in case anyone goes off down some random road - I have no personal interest in the residential housing market as I am neither planning to buy nor sell in the short, medium, or long term. That doesn't mean that I cannot comment on the structural deficiencies that are continually allowing those who already have wealth, to suck more off the backs of those who don't.

fartooreasonable

https://www.boards.ie/discussion/comment/121550630#Comment_121550630

Well the job market has changed, we don't need that many uneducated 16-18year olds any more now, we need people with training and degrees yet they don't seem to be paid as much. Either way something has to give, if we need people trained it takes time yet it's the same cohort being punished with stagnant wages and lack of housing options.

That's not economic illiteracy, it's economic reality of the world today. A large of joba now are more skilled.

Former Former Former

Jesus the “avocado” thing really is the weakest of weak strawmen. It’s as lazy and stupid as blaming boomers for everything.

Blut2

https://www.boards.ie/discussion/comment/121550538#Comment_121550538

An increase in the number of third level graduates would suggest a significant increase in the earnings of the 25-34 year old age demographic in question, ie an increased ability to purchase a house all else being equal. A 30 year old college graduate earns significantly more on average than a 30 year old who never attended college, and the former will obtain a mortgage much more easily.

The drop in house prices during/after the 2008 recession was also accompanied by widescale unemployment, increased taxation, reduced wages and very limited bank lending that had a massive impact on the ability of people to buy houses.

The drop in home ownership rates for 25-34 year olds from 60% to 27% is pretty much exclusively explained by the housing crisis. The idea that the number of people in this age demographic who want to rent (at a time of astronomical rent prices) has doubled in the 15 years in question is absolutely delusional.

And, again, this is not my conjecture - its backed up by all the polling on the issue, which show housing affordability is the #1 issue for this voting demographic. They aren't saying that because they're happy renting, its because they've been locked out of the housing market and are unable to buy, while very much wanting to.