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

I'm talking about people with a job in this country that can't afford to buy a place (relevant to the property thread), assuming they can get a job somewhere else, net of taxes and costs are they better off in terms of spending power and quality of life with what is left. We've gone off on a tangent about poverty levels, that's a different problem. It isn't just housing here that's expensive, it's the high tax and the cost of cars, groceries, insurance etc. etc.

To me quality of life is around things like affording to eat out regularly, having time to do activities you want to do (not being a couple with both in a 10 hour a day job+commute just to afford rent/mortgage/child care). I think on those measures quality of life in Ireland is probably not as great as the various stats make out, especially for people that don't own property, many of them must be living like hermits if they want to save net of high rents.

Not necessarily. The purchasing power only relates to one item - a house. If house prices drop, then it means you need to borrow less and/or minimum deposit requirements reduce accordingly.

Interesting data here https://mynest.ie/pricechanges/Dublin

Again to put that in perspective. 148 of 16790 properties had decreases, that is less than 1% of properties. That is a little less interesting.

https://mynest.ie/

There's no simple comparative dataset for sale prices like there is for listing prices. Lots and lots of manual work to try link them to listing prices and similar properties

Inflation is irrelevant - the only thing relevant really is the cost of a mortgage over the lifetime of said mortgage.

House prices drop when rates go up - but only because a house worth 500k when rates are 2%, could be worth 400k when rates are 5% (these figures are purely illustrative and not real!)

A couple on same income in both cases sees their affordability drop, and that is the cause of house price decreases. As you said general inflation is irrelevant.

The only buyers who benefit from increasing rates are cash buyers. Anyone waiting on a house price correction should not cheer interest rate rises as its ultimately a 0 sum game.

No they are the date of the sale as far as ive ever seen.

Only problem with scraping data from the PPR is that its very hard to identify the houses on it most of the time.

It would be far far better than the pointless reports of asking prices are though for gauging the market.

I think the government should continue their agenda of subsiding rents and also leasing social housing. Always good to keep our debt levels high, rather using the corporation tax for building social housing.

https://archive.ph/6NENO

They havent been aggressive enough from the start though. Thats the problem.

As a country we are bankrupt but sure the the boom is getting boomier, what could go wrong, it’s different this time.

your post made reference to 30k that was already saved though.

Im seeing a 17 euro rise in monthly payment for every 1% ecb rise. Not a lot but enough to p!ss me off. 42.50 up from last Summer so far. Was 50/50 to fix or not before the hikes started. Never imagined ecb rate would go back over 5% but looks like it might.

Was reading about people's mortgages sold off to vulture funds due to being classed as non performing loans. They restructured in the 2010s and parked part of the debt. However they now dont have any options to fix so are giving up on trying to service their mortgages due to massive monthly increases so that could be more properties on the market soon.

I wonder are we over egging the impact of interest rates on the market. Take an example, 400k mortgage over 30 years. A few months ago you could fix for 5 years at 3%. Mortgage cost 1.7k approx. per month. You can currently still fix for 5 years at 3.5%. Mortgage cost 1.8k per month. If we assume rates go to 4.5% its 2k per month. So about 3.5k more per annum over the base case. Hardly back breaking for most people who are considering getting a mortgage at this level. Could rates really go much higher than 4.5%? Unlikely I would imagine considering the broader risks to EU economy. In an era of high rents and broader desperation around housing, I wonder will people really get the drops they are expecting.

Certainly - Irish mortgages are much more heavily stress tested than most countries so the likely worst case scenarios of interest rate rises won't change the affordability calculations for most people, though it will of course factor into decision making. Most experts still seem to be of the opinion that the interest rate rises will cool the price increases we've been seeing, but the likely outcome is swapping a period of rising prices for a period of stability, rather than a sudden drop off a cliff.

People in Ireland have record levels of savings on deposit currently which is allowing banks to keep retail rates from rising as much as the ECB, and the growing economy is an outlier in difficult times globally which will likely see more increases in net migration and continued growing demand, while building and material costs continue to constrain supply. So there's a lot of factors at play pushing in different directions, but fairly stable prices look like the most likely outcome.

The trouble is that, for the majority the affordability calculation means they were unable to buy before the rate rises started