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

CB Ireland reckons it would only cause a "modest" rise, well why would the implement it at all if it was going to cause prices to rise I thought their whole job was to tackle inflation. Us idiots could even see it was going to cause prices to rise substantially while still not benefitting anyone. That article saying phones lines hopping disgusts me, what are these clowns at that are supposed to be economists and understand the consequences of their actions.

Presumably to help those who can afford the mortgage repayments to buy houses. As Karl Deiter said this morning, if someone can afford to pay 2k per month in rent, what is the issue with them being able to buy a property with 1300pm repayments? To trap them in the rental sector when it obvious that they can afford a mortgage of x4 times their salary is equally unfair.

I guess paying 2K a month on rent during good times is one thing, while paying 2K rent for their life time, which may include multiple boom and bust cycle is another thing. Imagine paying a mortgage of 2K for 30 years.

Dave weather its by design or the law of unintended consequences the governments since the last bust have. - All of which have had either FF or FG in it.

1:) Stopped building social housing

2:) Decided that it was better to have REITS in making profit hand over fist on rents than domestic landlords and have skewed it financially and logistically so with how landlords are treated and offered deals to REITS of paying them rent to the tune of millions a year instead of using this money to simply start building social housing again.

3:) They have introduced the help to buy grant, first home scheme and now they have gone and put pressure on the Central Bank to increase lending limits. The only reason why this is happening is wage in the private sector is not keeping up with inflation and they think its better to allow others get into more debt. The 3.5 times a salary was possible the best thing this government ever did and was done to stop people being overly burdened with debt and yet they have decided its better to give the developers more in their pockets and keep FTBs in debt for longer. It also throws a huge gasoline can on inflation its beggars belief that they did this.

4:) No accountability for those building/construction industry we get the "aw we cant do anything about it sh1tology" except get others who are completely innocent of any of the above to pay" - Mica, Pyrite, health and safety regulations its an endless list of lack of regulation for the industry.

5:) Allowed a emigration policy that has us at breaking point with regards to housing and other services. I am not a racist person I have good friends from Brazil (play 5 a side with half a dozen of them) work with Polish guys, but something has to give and currently its our young people trying to get on in the world they have seen cost and access to rentals and buying completely evaporate and this will show in the next 1-3 years as our youth go else where there is zero incentive for them to stay here.

Now how many politicians are landlords and are constantly lobbied by the construction sector? That is the question that needs to be answered. I think if someone is voted into power in this country they should have to sell any secondary properties that they own in order to keep them on the straight and narrow as there is a conflict of interest between their own pocket and the rest of us and before I get the aw that is too much. Its not they get paid very well and if they only get the one go at government they also garner a pension us mere mortals cant afford. Not bad for 4/5 years work and then if they finish they can go out and get back into the property game.

if you can afford it whats the issue, its better than paying rent for 30 years.

What's the average salary in Derry? Bit of a pointless comparison, we know Dublin is expensive, but there's a reason nobody wants to live in Derry.

Ive lived in Dublin and Derry. Whats the reason nobody wants to live in Derry?

Everyone knows that it cannot be easily sorted, but they are wasting money on paying rent, on grants for first time buyers, on HAP and other expenses to try and house people if this support was taken away the market would see price drops across the board and the money saved could be used to start building social housing even these modular houses that are continuously talked about on a large scale. I think the plan has to change the idea that those not working can pick and choose where they live and the type of accommodation they want to live in is no longer feasible and has a lot of unfairness about it. It would be unpopular as it would be seen as taking away from the poorest yet its these very supports that have continuously pushed up prices for everyone else. We have tried the route of expecting private builders now for a decade to supply a suitable amount of housing for our population and it has not worked in fact it has been nothing short of a clusterphuck its time to shift away as they are all about their pocket and have no regard for the greater good within the country. There is no doubt in my mind that this step in particular shines a light on corruption as the relaxing of these rules does nothing but pump more money into developers pockets and shifts more debt onto First time buyers. As I said it is glaring that they didn't relax the rules for 2nd hand homes as this money would not see its way in to the grubby paws of the construction industry that to me is the smoking gun that shows who is running the show here and its not the people we elected.

I think you have it wrong, unless I'm mistaken, but the 4x rule is across the board for FTBs, it's not limited to new builds. They can buy second hand homes, so we'll be seeing a strong resurgence of bidding wars.

Jaysus the amount of bidding wars I've seen go up and up, it was clear the only thing constraining folk was the limits to lending.

I would assume it is in the best interest of the lender perhaps. I don't think the 3.5X or 4X salary limit from the CB guarantees a bank to simply sign you a cheque for the amount.

You have lending limits because this is longterm debt. You have affordability limits so you can access if the person can afford the house.

One of the biggest reasons for the last crash was excess borrowing.....not necessarily mortgage lending.

Back then you got pre-approval in you door every few weeks telling you that you were approved to borrow 20,30 or 60k.

I saw people buy a house fully furnish it and park an 06/07/08 new car outside the door and go on a foreign holiday as well.

You had Eddie Hobbs advising people to have large wedding because of the cash presents they would get.

Start mortgage's were handing out 6X income and especially to people with variable income.

If you were in the building trades you upgraded you van every two years. You could not be seen arriving on site with a tub of sh!t and definitely should not be pricing jobs in it. As well a lot of single lads that were working for subbies had a van for to and from work and a driving around car for the weekend. And Start mortgage's gave them 6X income.

People changed there car at a whim, lads used to change twice a year. Ancillary borrowing was as much of a problem for the crash as lending limits.

If you were in your 40/50's you had to have a second house rented ( rental returns went as low as 2%,). Or else you were buying an apartment in Spain or the canaries.

The last great outpost after Spain, Lanzarote etc got too expensive for us was Cape Verde. You had to get in on the action. Small group of Islands 1-200 miles south of Lanzarote. This was going to be the new Lanzarote you had to get in on the action. There was going to be tens of thousands of apartments build there longterm and you could get in at the beginning. O ly thing there was no regular flight to it and still are not.

That is why you do affordability to find the stupid cun! with a gambling habbit where there is 3-400/ month going out. The couple with 10-15k in credit card debt, or two car loans for 30+ k between them costing 600/ month for five years

Hence I don't buy the theory that if you can pay 2K rent today.. you can continue to pay that during a downturn/recession on a mortgage.

But again, it depends on what percentage of your salary is going to rent. Say if a couple is on 80K a year, after tax their monthly income is about €5,000. At the moment they have no choice but to pay 2K a month in rent (which is about half their salary) as they no other option, do you think the bank should still lend then money on the hopes they continue to pay 40% of their salary on a mortgage ?

Fair enough I suppose.. but there are multiple assumptions there

• Would you be able to get anything decent for 320K in the same area you are renting in, probably not.
• Would the higher leading rate just not cause a crazy bidding war.. So a couple on 100K would always win
• 3% interest rate now sounds fine, but who knows how high it can be. People expect ECB rates to be hoovering around 2.5%~3% by mid next year.

Either way we shall wait and see how it plays out, time will tell.