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

Yes I agree with you in terms of rent, but the ERSI Model (Linked Above) I am talking about is about how they calculate the housing inflation for Owner Occupied Housing and they do it by using this Rental Equivalence Model. My problem is the way the model is constructed as it was previously 2/3 long terms rental >5 years and 1/3 new rentals (prior to the pandemic and it actually according to their report validated and tracked the real shelter inflation quite accurately). In the last 6 months most people returning back from WFH and abroad are entering the new rental side as opposed to the long term low rents. This means that the weights for calculating (3/4 new 1/4 long term more like now) this inflation are wrong and hence downplaying the rate of shelter inflation in Irelands overall CPI figure.

Figures on CBI site (who publish this quarterly) show as at December 21, 19.4bn of lending had a fixed duration of 3-5 years, 10bn was fixed 1-3 years, 2.2bn greater than 5. On the floating rate side, 17.1bn was tracker, 13.5bn was SVR, and 2bn was fixed up to a year. The 3-5 year fix has been gaining popularity the past 2 years increasing from 10bn to 20bn.

The similarity with circa. 08 is that there is currently a crisis brewing where people are getting poorer. The reason why this is, is different to circa. 08 of course as today it is from high inflation where cash is not going as far in our day to day lives. However, in terms of a safety net for people, unlike after 08, QE can't be a solution to resolve the issue of a lack of cash in people's pockets because excessive QE is creating the problem that needs to be fixed!

Which translates to a very quickly receding tide of liquidity and no replacement water to come in and keep all the boats in the harbour afloat. The central banks actually have to take a backseat and let the chips fall where they may; it's important that everyone has their own nest egg (ie savings) for the bumpy ride that's coming. The zombie companies will be taking a bath as will the hyper inflated valuations of certain assets.

whopper headline anyway

You have to hand it to Leo. He looms out of the crowd as the most sociopathic of all sociopaths in the Dail. He couldn't give 2 sh!tes about people struggling to pay rent in this country. Now we're gona have to listen to more of this sickening nonsense the closer it gets to him taking over from Martin. Hes a low life.

Ive seen some signs that things are starting to cool off.

A house near me has been reduced by €35k asking price. It was listed for what i consider a high price but I wouldn't have been surprised if it had gone to that price after some bidding the way things have gone over the last while.

Another house couldn't hit the sales target the seller wanted and it was returned to rental. It wasnt a mad amount that the seller was looking for.

Both houses in the semi D family home pretty standard suburban stuff.

Was at a furniture store ( branch's in all the main cities) last weekend and got in conversation with the manager. They are expecting a difficult year, many orders have been cancelled due to escalating costs of works on renovations. There scaling back the renovations also.

If homeowners are feeling the pinch imagine what the growing renting demographic are experiencing

Amazon making a loss is an eyeopener

Growth in retail in the US was significantly less than the rate of inflation, yet the growth was spinned as a positive. Same with job numbers viewed as a positive but a significant drop in labour participation rate

I think if any landlord has been broken enough to have to sell their current rental, they are not going to be buying another one ... ever :)

Nice little collection of selling and buying costs (solicitors, EAs, Stamp duty and what have you) in there too.

I know of two people due to start their own build this year that have pulled the plug a while.

The risk of starting a project that you are already maxed out on budget wise having 20-50% price increases on some materials would stall any prudent person.

Also price is one reason and probably the biggest, but uncertainty of supply is also a factor.

Unless you are planning on storing an airplane then why the need for such a large house? If you cut it down to 150 square meters that is still a fine size house and you would save yourself a fortune.

That's correct yes. Then, rents are too high. Reduce hap and rents will follow. Same for housing, try bidding against the council and see which side you come out on. Inflation of assets and rents directly through current policy. I know its not the poor that are to blame, its the policy of our current government.

I have been told that two concrete suppliers and block makers are going onto a 3 day week because of lack of activity

Things are cooling off, only the foolish left in the market now

hap up is only artificially driving up rental and property prices and encouraging many not to even bother looking for work

time for a major over haul but no political appetite