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

how can you determine a trend unless you account/estimate for hidden variables?

The survey you posted put the cost differential between 2 and 17% with the average at 8%

Ive seen another survey that puts it between - 4 and 15%

The survey from reading it covered all home types including those glass boxes you see on room to improve. For the purpose of the relatively small houses we build in Ireland and the need for 1 and 2 bed units the cost would be closer to the lower end of that scale.

One gets the impression from those surveys that costs come down as more adopt the technology. This may offset the inflation and may push construction to less labour intensive practices

Wrong about what with respect to salaries?

I am saying that salaries would need to go up to justify the current housing situation but the overall cost of living must stay down at the same time (this obviously won't happen). I have said that those renting and working are ending up worse off financially each year since 2015/16 due to the rise in housing costs and general cost of living while salaries are not climbing as swiftly.

We are going to see salaries increase, and it looks like it is already starting to happen (anecdotal observation), but we won't have a clear picture until into next year as people typically have annual salary reviews that won't have been undertaken as of yet. This will fuel more inflation into next year in housing and cost of living, undoubtedly. At the same time, the State can only justify the current level of public spending (which of course is contributing to fuelling demand for housing) because of the pandemic. But the pandemic will end and there is nothing to replace the State at the same level. That's where it all cools down.

1 why would there be no revenue? I recall back in the early 00's families paying more in rent on a council house than what it would cost to rent a better private house in a percieved better area. Security of tenure being far more valuable to them

Revenue positive might be a stretch, but the situation would be markedly better than forking out billions to foreign investors every year. With social affordable the money stays in our economy to be recycled

2. Do you think the private sector would reduce output pro rata if the state ramped up building their own supply. Initially I suspect the private sector would ramp up their output so that they could get theirs built and sold before the states supply comes on stream.

State and private developers would be serving separate markets

We are pulling workers from many different countries for many different sectors. We are not the first country in the world to suffer a lack of required skills. There are tried and testedsolutions

We are hopeless at teaching foreign language yet jobs requiring such skills are created all the time

Many countries in Europe are struggling and would have spare capacity we could tap into

There are also more methods and materials used to build housing that require less labour

1. Rents are already high, are you saying council houses will be able to prop-up even more? What's the point than, to get more from middle class that pay high rents already. Do you have any link showing that families paid more for council housing, than for private? It's abit difficult to believe, although I was not living here in Ireland back than, so have no idea about council rental back than.
2. Private builders are chasing the profits, and who provides better conditions. If public sector will provide better profits/conditions they would move to public sector projects. "State and private developers would be serving separate markets" - this will not happen, and if it would start quickly to move that way further from Market economy, I would expect a total disaster.

what was the reason for 10,000 construction workers on PUP payments in September?

Did they have covid or were they a close contact or was it that there work needed to be undertaken indoors where they were unable to social distance?

can’t help to think that there was a % of pup recipients that were claiming PUP at the same time as working for cash. No idea how big an issue this was but it did result in Garda setting up check points to target this fraud.

1 the point I was making is that building our own is far cheaper and has the potential to be revenue positive

Imagine you had an asset built in the 60/70's and your charging rent levels for the noughties in an environment of full employment, even in a council environment it would difficult to make a loss

I'm not saying that will happen straight away if we start ramping up construction, but with a bit of luck, that may well be the situation when the pension crisis hits

Instead we are entering inflation adjusted long term leases that even protect investors from depreciation

Tax payer covers the cost either way. Current system fleeces the buyer in the purchase of their own home and in the highest cost method of social housing provision.

The state building their own stock would ease the burden through cooling house price inflation and significantly lower cost social/affordable housing provision.

2. The best way to ease the hurt of a crash is to implement policies that avert a bubble. If all state intervention is on the demand side a bubble is inevitable

1 higher standards = between 2 and up to 8% average higher costs. Bulk buying for larger projects may offset some of these potential increases and with the savings throughout the lifetime of the house it's a no brainer.

Where am I excluding land costs, and if the state has its own land idle what benefits are accrued from having it idle. Could they not put it to use to reduce outgoings elsewhere

2 Lti is a central bank induced measure overseen by the ECB. Government policy has been to undermine and circumvent it.

Can you give me 1 meaningful supply side measure implemented by government in the past 13 years?

2 to 8 % discussed Friday from a survey. Land has been sitting idle for years nothing done. More land has been sold to developers/investment funds and they have sat on it knowing that the system put no punitive measures if it were not used and will almost guarantee price appreciation

Of course developers are chasing profits, they are also one of the strongest lobby groups in the country. They are running rings around the government and every scheme they dream up becomes government policy.

These schemess maximise their profit, keep them in control of supply and citizens that rent or need to buy pay the price plus taxpayers have to pay for what must be the most expensive social/affordable schemes.

I understand why you are unable to identify one meaningful supply measure. Oddly an affordability crisis is being dealt with by multiple measure that all increase price. You know who's running the show when you see the results

This article is from mid 2000. Its scary how it could could have been written 5 years ago if you take the figures out of it

This time its different, you know

I don't know of what survey you are talking. But high quality homes can definitely cost over 10% in price versus low quality.

Nothing valuable is free. Whatever way you are looking, if you handing something valuable for free there is lost revenue. some particular group of people would get handed "free" land, while others should compete with reduced supplies.

Building may go up even faster if government sells that residential to private sector, than trying to develop themselves. Developers run on full or close to full capacity already. You may think that there are no jobs for those 10,000 PUP builders, but the real reason why they are on PUP could be very different.

Where are you getting your 10k construction workers on pup from?

the lattest from the cso is

If you were in work and had covid or were a close contact you received a different payment.

PUP is exclusively for people where work has stopped. I've worked on site throughout the pandemic in manafacturing. We had a brief period on ewss, which covered reduced hours but that ended quickly as demand increased. No such facility has closed that I'm aware of.

Looks like those road blocks proved effective