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

I would not leave tracker if I was on one, they will be lowering rates and big surge of QE by latest end 2023. I just think this constant central bank action has diminished a real free market. I think this system is broken

How many rate rises do you reckon we will have? The US markets are betting that interest rate cuts will start in the US in early 2023 on the basis that economic activity is already slowing significantly.

I guess to you your point, how long do you expect ECB to have negative or 0% interest rates ? Basically the last 8/9 years, it was cheaper to borrow money than to save money. This is not tenable and I think ECB should be look at a minimum of 1.5~2% interest rates by end of next year.

Easy credit has just distorted the market completely, sure it will cause panic in the economy but this is needed in my opinion. I still remember the interest rates were above 15% and you got decent returns on savings.

Also the reason we have the highest interest rate in Europe is cause there are over 5k people not paying their mortgages for over 10 years and yet living in their house rent free without paying a penny. Hence everyone has to contribute to their life style.

NTMA prediction is GNI -0.8% for the year

I'd like to say the penny has dropped regarding HTB but I think not.

Yet another review of the scheme has be undertaken by external consultants (for a decent fee no doubt) to tell the Govt the HTB is supporting high prices.

But they did not act on that previous advice at the time and now, low and behold we have another review saying it is poorly targeted.

We have seen posters on Boards claiming there are many borrowers on 6 figure salaries with 6 figure deposits wanting to avail of HTB buy because it 'saves' their deposits. I do not blame these people either - if the Govt is giving away free money why wouldnt you talke advantage of it.

No doubt there will be the usual stream of lobbyists going through the doors of Govt to push to keep the status quo for the 'HELP TO SAVE BUY' scheme.....

Potential solutions from the USA whose market appears to be a mirror on our own

I've seen some interesting properties come up near me but didn't realise this may be a more widespread trend

Some church lands in good areas and old houses on own grounds/large sites etc

Covid cash seems to have dried up, leading to less money being available to purchase houses.

Will this see a drop in prices? Hard to know, but possibly a little.

"The report found that house hunters have an average of €304,000 to spend on a home, which is €27,000 (9%) less than it was a year ago.

Additionally, mortgage seekers have €11,000 (15%) less savings to put towards a deposit for a mortgage compared to the same time last year."

Surely the reduced amount to go towards the 10% deposit will have the biggest initial impact

e.g. rough numbers 30k deposit for 300k house vs reduced savings for deposit (less 11k on last year) 19k towards 190k house ..

this will have to a big impact on effective demand for property here and really shows cost of living increases without corresponding real pay increases from employers will soon have a major knock on effect ..

europe is also staring a major recession in the face with russian gas supplies down to 20% of capacity germany in particular but all of europe essentially is particularly vulnerable to economic shocks over the next 6 months or more..

There's a "Willie Big Bang" coming

Theres a poster on here who has tracked the myhome.ie price changes on a graph, any chance they could cost the latest version?

Typical FF/FG talking point that. If the MNC starts leaving everyone will have a smaller cake, which is true. 

But it all depends on how you look at it, if you get a larger slice of cake at the moment, a 20% reduction will hit you more than those with a smaller slice of cake to being with or even better still, those that don't have any cake.

if only it was that simple and everyone got hit equally with a 20% hit. In reality it will be workers that provide services and goods to people working in MNC’s whether directly or indirectly that would be hit the hardest. It always surprise me when people assume that they won’t be impacted personally by a downturn and will benefit from cheaper houses. Then when taxes have to increase due to a fall in tax receipts it’s the government’s fault and not related to the downturn in the economy not to mention if overtime dries up or hours get cut, smaller bonuses or none at all or at worse loose their job or business.

Because those MNCs employ people here (275k in 2021), and their high wages spend (payroll spend was 16.8B in 2020) have a huge positive affect both directly, and indirectly on other jobs/the economy.

Your grasp of economics is shocking. First of all you would never see an access the board linear cut.

If you got a 20%cut it would be due to a sectoral collapse in one area maybe hitting the Google's and Facebook type companies, a shock to the pharma sector, a shock to the software development sector or to the hardware sector.

It could decimate Dublin City center or cities like Cork Limerick or Galway while leaving the rest of the county minimally effected.

This would then hit government tax receipts from MNC by maybe much more than 25% as well as PAYE and Vat receipt. Road building and publicly works ( hospitals and schools) would slow down and maybe stop.

Government would look to replace the missing tax base by higher taxes and Vat. But because we are already highly taxed in the middle and upper tiers you would see if extra charges and levies

In the region's most effected you see the closure pubs, restaurants etc. Logistics companies and couriers would downsize dramatically. Car sales dropping significantly electrical goods erc

Next the workers in these area would start to look for jobs in the area's not effected putting more pressure on housing and wages in these areas. Because of the pressure on housing many would commute or only stay during the week.

After the building collapse in 2009/10 I knew a good few locally that were in similar situations. One lad stayed in Dublin Monday to Thursday. He was all WFH Friday. Another lad commuted a 3 hour return journey every day to a fairy average job.

And at the end of the day houses would be no cheaper in 90% of the country

Would all the same arguments hold true if citizens had affordable (not free or unprofitable) housing. The path to economic stability and sustainability is not just good jobs. The outgoings are just as important as the incomes

Housing and the economy should work in sync benefiting each other, not with one a parasite on the other.