Softening house market?

AdamD

https://www.boards.ie/discussion/comment/119050661#Comment_119050661

If your predicted economic crash happens our housing supply will get worse. We've got inflation causing building costs to skyrocket, if sale and rental prices drop, building will not be feasible...

Pussyhands

https://www.boards.ie/discussion/comment/119051797#Comment_119051797

If jobs are cut, then there'll be emigration. We have a lot of foreign workers with nothing tying them here.

https://www.boards.ie/discussion/comment/119051186#Comment_119051186

Most house I am looking at are going sale agreed within 3 weeks. They have 3 open viewings and then gone, the house I am bidding on is 10% over the asking, and no sign of it stopping.

Sierra Oscar

https://www.boards.ie/discussion/comment/119052004#Comment_119052004

You could argue that emigration during a downturn would be dependent on having brighter prospects elsewhere. Isn't the issue of inflation and global economies slowing an issue right across the international economy? It's certainly not unique to the Irish economy, which is still expected to outperform other countries across the Eurozone and further afield. I'm not so sure we will see huge emigration to countries whose economies are faring worse than ours. Worth noting that many of the traditional destinations for Irish emigrants are currently in the midst of their own housing crisis. Hard to see forenigh workers returning home to developing nations either, many of which are in the midst of a financial crisis on a scale to what we experienced in 2008.

The effects of the previous financial crisis lingered in Ireland for many, many years due to our banking crisis which ensured we were hit far harder as a result. Can the same be said this time around should the international economy enter a profound recession? Where will potential emigrants be attracted to? Genuinely curious.

dubh laoch

https://www.boards.ie/discussion/comment/119052379#Comment_119052379

You could possibly be onto something about emigration but young people will always find a worthy location to travel to during a downturn in Ireland. Places like London and Sydney will always have jobs and opportunities even in the midst of financial crises like back in 2008. Ireland is expected to outperform other economies but as everyone knows, Ireland is also much more susceptible to what's happening beyond our borders due to the open nature of the economy. The rosy outlook for Ireland's economy can change very quickly based on what's happening in the US and Europe. You may find it hard to see foreign workers returning and maybe they won't but affordability of Irish rental/housing costs would weigh heavily on workers that decided to stay if they are out of jobs.

Sammy2012

When do people think interest rates will start to rise? We are currently trying to break out of our fixed term and pay a lump sum off the balance and refix. So far its taken almost 7 weeks and and we are still not on the variable rate. The bank are now advising me to send in all forms required as soon as to speed up the process. The delays are down to many others trying to break and refix to avail of cheaper rates for longer.

HerrKuehn

https://www.boards.ie/discussion/comment/119052715#Comment_119052715

ECB has signaled they will start rising in July. As to whether the banks will raise immediately every time, is not really clear.

Sierra Oscar

Worth noting that some banks are still dropping interest rates. PTSB recently dropped its rates to 2.35% from 2.55% for 'green homes' - i.e. BER of A1 to B3.

https://www.permanenttsb.ie/about-us/notices/2022/april/permanent-tsb-launches-new-green-mortgage-with-reduced-rates-for-both-new-and-existing-home-loan-customers/

Permanent TSB green mortgages will be available from April 30th for homes with an energy rating of B3 or higher.

I suspect some banks will insulate their green mortgage from the rate rises for a number of months - PR effort to appear 'green friendly'. Probably to the detriment of everyone else, though.

toyotatommy

House prices will rise 5-10% in July as raw materials to build are taking an increase. It’s high time houses match the value of higher build cost.

Pussyhands

https://www.boards.ie/discussion/comment/119052379#Comment_119052379

We have tens of thousands of brazilians alone who are here on short term stays.

As for the Irish? Well I don't see same levels of emigration but if it does happen, why not travel to Australia for a couple years instead of slogging it here?

Sierra Oscar

https://www.boards.ie/discussion/comment/119053183#Comment_119053183

They won't be rushing back to Brazil anyway, its economy is in a bad way currently.

The economic picture isn't exactly rosy in Australia either and it's also getting harder to get into for those looking for working visas.

You'll always have emigration to a certain extent, but it's not like previous times - like 2008 - where our economy had fallen off a cliff edge and remained depressed for years whilst other economies bounced back quickly. Australia is facing the same challenges as we are, arguably worse if China goes into a major recession as it will collapse commodity prices.

Supercell

@Sammy2012 Surprised to hear that, we are with BOI and broke out of fixed, upped our payments , changed the term of the mortgage and finally re-fixed for 5 years at a higher monthly overall amount to shorten the term futher but leave us a buffer if need after the five years. All that took about four weeks. Though calling their support number always included a 30 min or so wait. The paperwork was very straightforward.

Mad_maxx

an uncle of mine went sale agreed on a house in Dublin 9 in the past week , three bed semi , 487 k , insane price for a very average house , its just nuts out there

deirdremf

https://www.boards.ie/discussion/comment/119039621#Comment_119039621

The war in ukraine will put a stop on things. Fuel is vastly more expensive than it has ever been before - a few thousand per annum added to your commute bill is a multiple of that out of your housing budget. Plus inflation generally running at 7 or 8 %. Of course interest rises are the biggest difficulty; but several factors coming together can kill the market.

deirdremf

https://www.boards.ie/discussion/comment/119039851#Comment_119039851

Actually, the market stagnated from 2006. It didn't start falling immediately, of course, and you are right, in Dublin it fell until 2012; later elsewhere.

deirdremf

https://www.boards.ie/discussion/comment/119040078#Comment_119040078

Very true, I remember one of the uber-bears suddenly turned around in 2012 - about a year into the FG-led government - and called the bottom of the market. He was right, because a lot of measures were put in place to support the market by that government. I got the impression that he was well-placed to have an ear to the ground.

deirdremf

https://www.boards.ie/discussion/comment/119040076#Comment_119040076

By that logic, you must think SF had something to do with the crash in 2008?

deirdremf

https://www.boards.ie/discussion/comment/119040205#Comment_119040205

I think you might be mixing up two different things - the size of the market, and the price of the goods.

"The arse fell out of the market" to most people means that there was little or no market any more - people weren't selling, or people weren't buying. In 2006/7/8, it was a lack of buyers. This logically means that prices drop until they reach a level where people are willing to buy again. With a highly illiquid product like housing, this takes time. Most property owners try to wait the crash out, and only sell if needs must.

toyotatommy

https://www.boards.ie/discussion/comment/119054221#Comment_119054221

The person or people who bought it are nuts to have paid that amount. They are only contributing and worsening the situation.

macvin

https://www.boards.ie/discussion/comment/119039417#Comment_119039417

Please read my post again.

It's the ridiculous excessive bids that have started to pull back.

It won't affect a regular house in Dublin 15 yet. But it's the start of it.

Prices will not collapse, but the market will soften. The easy cash is gone.

screamer

There will always be areas of high demand that will maintain the pricing. However, developers are pulling back on new builds as material prices are crazy. That means fewer new builds. However if the banks get spooked, they’ll pull anchor and the prices will fall. Hard to know what will happen but houses are definitely once again way over priced. I hope we don’t see another generation consigned to huge mortgage payments on houses that were never worth what they paid for them. Sadly I fear that will happen again.

Tar.Aldarion

https://www.boards.ie/discussion/comment/119054526#Comment_119054526

There's a lot of info missing as to whether it is worth it or not. That's not even near the top of the prices for the area.

Sammy2012

https://www.boards.ie/discussion/comment/119053911#Comment_119053911

Yes its definitely a slow process in my experience anyway. But the staff on the home mortgage helpline couldn't be more helpful I have to say. And the waiting time on the phone isn't that long. Usually calls answered within 10 minutes. We will have it all sorted by next week hopefully as they told me to email in all the forms required together so there wont be further delays so plan to do this over the weekend. Can forget about it then for another 5 years.

Sammy2012

https://www.boards.ie/discussion/comment/119054605#Comment_119054605

Family member is working on building sites at the moment. He was saying that a lot of plumbers and electricians have very little to do but it's due to shortage of materials. There is a shortage of sanitary items for bathrooms and also wires and other things electricians use. So even though new builds are continuing they can't be finished due to supply issues. My local town has many estates under construction at the moment and plans for many more in the next couple of years but shortage of materials are having a huge impact.

Mad_maxx

https://www.boards.ie/discussion/comment/119054243#Comment_119054243

House prices often rise in tandem with inflation

Mad_maxx

https://www.boards.ie/discussion/comment/119054354#Comment_119054354

SF weren't in government back then so you're point is bogus

My point was based on SF leading the next government which they likely will

Mad_maxx

https://www.boards.ie/discussion/comment/119054801#Comment_119054801

It is for this part of D9, its not Drumcondra or Glasnevin, Beaumont

You could spend 50 k making it reasonably ok

JimmyVik

https://www.boards.ie/discussion/comment/119050661#Comment_119050661

I can tell you plenty of stories of people in bidding wars over the last few years. Some dropped out because they didnt want to pay more than a certain amount over asking. They are still looking now and are looking at smaller houses for higher proices than even what beat them out the last time.

Some paid way over asking and put their bid way up to secure a house. They are quite happy now to be in their own house and out of renting.

lawrencesummers

Supply is difficult to understand as a factor in prices dropping, and I would love to hear from anyone who knows what they are talking about here.

Sure it drives prices up, no doubt about that as multiple people bid on whats available, but the lack of supply existed the last time property prices started to tumble, viewings had big numbers, people were queuing overnight to get deposits on, bidding wars were common yet outside factors caused prices to fall and the ‘crash’ happened even though supply was as bad or worse than it is now, the ghost estates came later long after prices started to fall.

So as some people have said here prices wont crash as supply still cant match demand and wont for sometime, but supply drives increases in prices not necessarily decreases in it.

timmyntc

https://www.boards.ie/discussion/comment/119055710#Comment_119055710

There was enough supply in 08, people were buying 2 or 3 homes, you would buy one and then flip it in less than a year and profit the increase in price. Pure pyramid scheme stuff, always reliant on price always going up. There was ample supply for the people who actually needed homes, the problem then was there was so much cheap money floating around that the demand for houses went up - people wanted to buy far more than they needed as investments and to flip.

That is not the case now.

lawrencesummers

https://www.boards.ie/discussion/comment/119055754#Comment_119055754

The cheap money doesnt exist now to the extent that it did alright and the central bank rules should make any fall less significant than before. I reckon for all the critics of the current rules they will in time have to change their tune, but supply was an issue back then, bidding wars were common, people bought off plan for crazy money, people slept in their cars over night to get houses are they were released in new estates. The lack of supply was definitely a factor in driving prices.

timmyntc

https://www.boards.ie/discussion/comment/119055826#Comment_119055826

The central banks LTI rules are the only thing saving us from a complete nightmare property bubble of catastrophic proportions. Anyone giving out about not being able to borrow enough due to LTI should be grateful - its themselves who are protected from mortgage default.

seamus

It's worth remembering that people in their late 20s and early 30s now were barely out of nappies when the bubble burst. It's 14-15 years ago. The nuances of the amount of cash that was flowing around and the amount of money banks were willing to throw at people, won't have been obvious to them. So now all they see is a central bank standing their way and being miserly with lending.

The rest of us remember seeing friends and colleagues taking out interest-only mortgages on properties based on nothing more than the expected rental income, and lending at 5-6 times income causing house prices to skyrocket.

As insane as prices are now, loose lending rules would be a disaster. Dublin would be approaching California levels of madness with bog standard 3-beds in the suburbs going for €1m.

keoclassic

I don't see it, they just keep going up and up where we are. And the stock is of poor quality. High price for very standard housing which needs work. It's hopeless for us at this stage. Seriously considering giving up the job and having 1 person working and moving back in with the folks for a year or 2. No chance if building either, too much red tape. Welcome to Ireland 2022, where young Irish people are held in nothing but Contempt by their own government. Too much leftist nonsense going on. The only thing that remains soft in housing is the housing that is being bought and given over to social housing, paid for by those who have no right to it, the rest of us keep having the ladder pulled up just enough that it's bottom rung is just slightly out of reach. The more you save the more the price goes up. It's tragic.

JimmyVik

Wage inflation will increase lending amounts, increasing house prices.

I dont really see anything bar, mass job losses causing prices to come down.

leahyl

https://www.boards.ie/discussion/comment/119056324#Comment_119056324

That's it in a nutshell for me....single, 37, not a hope of purchasing a property I'd say. I've saved and saved for years, always missing the boat when it comes to being able to afford one and now that I have a sizeable deposit, it's still not enough as prices are beyond my reach again. Soul destroying.

Wanderer78

https://www.boards.ie/discussion/comment/119056324#Comment_119056324

...what leftist nonsense?

keoclassic

https://www.boards.ie/discussion/comment/119056479#Comment_119056479

I've read your "solution" many times, you seem to think that more debt is the solution, I disagree and will not be drawn I to an argument with you.leftist nonsense is what I said and leftist nonsense is what I meant, most people know what I mean by that statement, I'm not too worried whether you do or not!

Wanderer78

https://www.boards.ie/discussion/comment/119056538#Comment_119056538

yes, rising public debt is the only solution here, as its clearly obvious, private debt/credit has catastrophically failed.

so again, what leftist nonsense/policies? baring in mind most governments in ireland and in many other countries have been primarily more conservative aligned...

HerrKuehn

https://www.boards.ie/discussion/comment/119056324#Comment_119056324

I agree that the state/government is too left wing economically, we still have the xmas bonus for long term welfare FFS. But, I don't get the complaint about government holding young people in contempt. What do you mean? If you are expecting the government to help you out, it seems a bit, I dunno ... Leftist

Wanderer78

https://www.boards.ie/discussion/comment/119057258#Comment_119057258

again, our political institutions are still more so conservative based, most policies are more aligned with maintaining the price of assets such as property, and most assets are owned by older, more wealthier entities in our societies. funnily enough, welfare payments such as christmas bonuses etc, are mostly spent into the economy, enacting polices such as maintaining ever rising property prices extracts wealth from the economy, heavily indebting it in return...

keoclassic

https://www.boards.ie/discussion/comment/119057258#Comment_119057258

Oh, I don't expect any help. What I expect is for them to stop excessively helping others by paying outrageous amounts of tax payers money for hap and the buying of private housing and handing it over to social occupiers. I'd like them to increase the tax on institutional investors to the benefit of non recipients of any kind of state welfare. The ones that, pay their tax in full, pay their health insurance in full, pay their medical and dentistry in full, their travel in full, pay their own pensions, pay for thir kids welfare and schooling etc in full etc and pay it all from their own pockets with absolutely no help from the state. Ie, not the people who work but also get state subsidies because they earn less. I'd like to see them stop punishing the middle class who work hard to climb the ladder of prosperity on their own merit. We are hit from every angle possible. The ones that don't inherit anything from anyone and have to do it all themselves. There are literally 100s of thousands of us.

Wanderer78

https://www.boards.ie/discussion/comment/119057354#Comment_119057354

again, only a small proportion of society claims welfare, most middle class costs come in regard rent and mortgages, our property markets have been in a state of effectively hyper inflation since we financialised are economy, particular our property markets, i.e. nothing to be doing with welfare classes, this approach is now collapsing....

James20221

https://www.boards.ie/discussion/comment/119057354#Comment_119057354

I hear ya! I earn 40,000, enough to pay higher income tax but as a single man not enough to buy a home. So my choices are live at home with the parents for years to buy hours from Dublin and my job and social life or else rent for life which is over half my income and leaves me at risk in old age of being homeless.

B2021M

https://www.boards.ie/discussion/comment/119056559#Comment_119056559

I think I asked you before a few times but you didn't reply.....why did we have the IMF here less than a decade ago if it's possible to just 'create' money?

porkmaster

https://www.boards.ie/discussion/comment/119057354#Comment_119057354

This thing is out of control. Literally out of control. The time to "do" anything about it passed years ago. It's just a matter of waiting to see what shape the inevitable collapse takes now, whether it's housing alone or everything into the bargain.

The middle class are, in effect, rapidly becoming reliant on social assistance and housing. The people who think this is a reliable, stable situation for the next 10, 20, 30 years need to stop sniffing urinal cakes.

"They" aren't going to do something about this spiralling situation, "they" can't do anything about it. Like most shocks and comeuppances, it's going to come from somewhere unpredictable and out of the blue.

Lap of the gods now.

monkeybutter

https://www.boards.ie/discussion/comment/119057682#Comment_119057682

find yourself a surgar daddy to move in with

This is why they say work hard in school because being at the lower end of the barrel isn't fun is it? Never has been

James20221

https://www.boards.ie/discussion/comment/119057839#Comment_119057839

Im not at the lower end? 40,000 is the average wage and for my age (31) is quite high. I got well over 400 points in my leaving cert and went to UCD. The lower end is earning under 30,000

porkmaster

https://www.boards.ie/discussion/comment/119057839#Comment_119057839

The single biggest indicator of "success" in this country is whether you own your own home or not.

Inherited, bought before the corporate commodification, got one off the social welfare, however.

It has practically nothing whatsoever to do with effort or brains, it's more luck than anything.

Some 30 year old woman working on the tills in dunnes stores with their own home is far, far more likely to have a higher quality of life than some 30 year old PhD without a home.

Over time there's a possibility of catch-up, but it's some going to accrue 300/400/500k versus someone who doesn't need to, all while paying the blistering rent.

Income as a measure of inequality is nothing compared to necessary expenditure.

monkeybutter

https://www.boards.ie/discussion/comment/119057949#Comment_119057949

nothing to do with success, you need money to live, simple as that

why get a phd, why spend all those years in college unless its to earn some coin