Looking to move... WTF is going on with prices?

People have lots more money, people realising they don't need to live within 10-15 minutes of work, supply was already low and 9 months of not building in 2020 and 5 months± in 2021 hasn't helped.

Anyone that can answer this will either be lying or you should be asking them for the euromillions numbers instead.

You should be looking at 3 or 4 bedhouses maybe 400k plus or buy a house with a large garden and build a 2 bed extension prices are going up

In every city in Europe due to maybe people working from home so need more space home office room if you are paying 600k for a house I presume it's in rathmines eg a middle class area

An extension could cost maybe 50k approx

no way you're getting a reasonable extension done for 50k, not with the cost of materials effectively being 50% dearer today than this time last year.

It might get you a nice garden shed to put an office in, with some money left over for furnishings but not something that'll add value to the house

A 4 bed semi or detached home in Rathmines would be more like 1.5 million than 600k..

A large extension on a house for 50k?

Guessing this is the house https://www.daft.ie/for-sale/detached-house-49-larchfield-dunboyne-co-meath/3469961 , not many 5 beds for 635k on daft.

I don't know the area well enough to judge but maybe the asking/list was much lower than it should have been.

https://www.myhome.ie/residential/brochure/28-larchfield-dunboyne-co-meath-a86-de08/4478596 this went for 642 earlier in year so up to over 800k seems a big increase, 49 does have bigger garden and garage so far more potential but still seems like big jump.

That said the market is a bit mad at the moment.

In the same boat. The only value is in the most expensive houses.

Cheaper houses are massively overpriced due to a number of factors (limited supply, more savings, ever-increasing rents, COVID babies, COVID divorces). Renovated houses already have potential profit factored in, so it's usually not worth the hassle.

Land is not so overpriced, but still expensive. The issue is building materials are far more expensive.

It's the second bubble in 15 years. Well done government.

I would be of the belief that if you can afford it and its the right location then go for it. I don't have any confidence that supply will improve over the next 3 years to the point where a massive drop occurs in house prices. I bought in 2018 and paid 21% over the asking. I quickly learned that looking at things close to my maximum budget was a waste of time.

50k wouldn't build you a fancy shed these days

Yet another friend put their house on the market in a total mess and had a buyer even before the sign went up.

They didnt even have time to paint or fix up the little damp spots on the bathroom ceiling or even hide away all the toys all over the place.

Called EA on Thursday saying they were thinking of selling could they get a valuation. EA was out and had it valued on Monday. EA then had 3 bidders in and out, about a week of the 3 of them bidding up to 10% over asking, sale agreed.

You dont even have to tidy up a house now before it gets sold :)

This market is crazy and best kept out of.

I think they're projecting 2024 before any semblance of normality returns to the market. If your plan is to upgrade to a bigger property within roughly the same area, then you're better off holding fire right now if you can.

I'd only advise someone to sell up and move on if they stand to be in profit/mortgage-free after making their move; such as going from a small property in Dublin to a huge one in Leitrim at half the price.

Even then, the good rural properties are seeing prices skyrocket.

Agreed.

I have renovated many houses over the last couple of decades so know exactly the cost of putting on an extension.

What you see now are people buying houses and thinking they know what an extension will cost them, only to find out after buying that they cant afford the extension without a new mortgage.

We have now stopped buying houses to renovate because a job that would have cost €50k with decent profit to all involved now costs €150k for the subbies and labour etc.

And even though the guys i have used all the time to do the jobs know i know that it will be only €50 arent interested at €50k.

"Its like this Jimmy, i'd love to do the job for you, but this fella down the road will pay €150k. If I did it for you for €50k I might as well throw the other €100k in a fire and burn it. See what im getting at?"

And thats a fair point.

I think people buying a house should be looking for houses that already have that extension built. At least then they arent paying way over the odds for it in the future.

In my view the time to move upmarket is when the market is low. The time to move downmarket is when the market is strong (like now). The market is cyclical and the best thing to do at any time is to prepare for the next shift in the market.

It is clearly not a time to move upmarket.

if you wait three years, houses prices may remain stagnant, you’ll be no better off but will have paid 3 time more in rent than you would in mortgage repayments

I am not talking about moving from a rental to buying. I am talking about moving upmarket as in selling one property and buying a more expensive property.

We had plans drawn up for an extension including a master bedroom/en-suite, new sitting room and extended kitchen. Tendered earlier this year and prices in around 350k. Unbelievable. This is more than we paid for the house

Central Banks weren't so willing to print money in the past.

There will either be a crash or the value of money will drop and 500k will seem like chump change in a few years

The last correction was based on a credit bubble.

I remember going to the bank to get an 80% mortgage. I was offered a 110% mortgage @ 0.6% above ECB tracker. (Sure get yourself a car as well, credit is cheap). I took the tracker, but not the 110%. Many people accepted the 110% offer and over borrowed. This inflated house prices artificially, which then corrected when the cheap credit disappeared.

There is no cheap credit now.

What we have now, is a shortage. Labour. Materials. Housing stock. For many reasons. In Cork city alone, multiple huge apartment block developments, thousands of units planned for next year have been cancelled since the govt changed the rental caps again. They're not viable to build anymore, risk is too high.

So you have this cumulative effect.

For developers

• Govt is actively dis-encouraging new homes from being built by making them unviable on paper.
• Labour costs are high. Inbound immigration is slowed, labour pool is small. Labourers were a group who were missed in the PUP, because many of them were cash workers. Many left the country last year.
• Supply chain is disrupted. Brexit, Covid, Weather disruption / climate / storms, multiple large marine losses recently. Backlog on materials. Material costs have increased 20-40% in the last 2 years.

For buyers

• Credit is not easy to get, strict limits in place
• Population is growing, backlog of buyers in the pool. More people competing for the same property
• Lack of supply

All the ifs and buts, when it comes to property keep it to the most fundamental simple rule supply/demand.

Supply

Already we have had low building numbers for the last 2 years, meaning we are playing catch up.

Not enough building laborers to support the amount of building needed.

Our left leaning government do not allow banks to take "family home" repossessions in any great number. Meaning these properties cannot go on the market

Our government and REITS are actively competing in the same market as the rest of us meaning they have more money to buy pushing prices upwards. This is also supported by the government rental scheme where you can give a property to the government for 20/25 years and they pay you and look after your property. Meaning new builds are being snapped up before the general public know whats going on.

Demand

Year on year for the last 7/8 years we have had more people coming into the country than leaving - more demand

Year on year we have had more births than deaths since the start of recording deaths and births in this country - more demand

Changes made to the current 8 years it takes for a non documented refugee to legal status which will now only take 4 months - Expect a tidal wave of people coming here once covid is managed - more demand

We have about 4/5 years of pent up demand even before Covid, people stopped themselves from buying as the buzz word was Brexit, people thought property was going to tank after this. Then 2019 step forward Covid and people thought the same, there are a huge cohort who have been waiting and saving (all time high savings in Irish bank accounts 21Billion) ready to go - more demand.

I reckon if the financial rules where not in play the 80/20 and 3.5 times a salary we could of had an additional 20% on top of current prices .

There is nothing to suggest to me that prices will be dropping in the next 5 years. Thats just my theory of which I hope I have given some rationale to, I was one of the few who went against the grain back at the start of 2019 stating prices were not going to drop due to the supply and demand pressures.. But anyone buying and selling I would look at your macro circumstances. As in "how safe is my job", "can I live here if I lose my job", "can I afford if if interest rates go up by 3/4%", then schools, work and other factors pertinent to your own circumstances would either encourage or deter you from buying or selling. Anyone stating they know where prices are going are either deluded or have a vested interest.