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

We know how we ended up with landlords leaving.

It really is that simple to remove the factors that made them leave.

Assuming someone would wake up and take that step, we are left with a problem we should never have created in the first place. Which is how we get landlords back to providing rentals. AirBnBs wont be enough on their own to do that, but at least you have made long term letting attractive again.

But why dont we do what wer have been doing for years and get the big stick out on a tiny part of the problem. Beat the owners up ad we can say we did something. All the while watching others just sell up never to return.

Simple solution or stick solution?

You may well be correct in terms of building slowing in Dublin, from what I can see materials volumes down considerably the last 3-4 months and seems to be on a downward trajectory since material price increases at the start of April.

Costing way to much to build now, couple that with high interest rates and fiance

Taxes will be designed so that they are tiny and trivial to pay. See LPT.

The workers are already self employed…most labour in building is via sub-contractors.

https://www.forbes.com/uk/advisor/personal-finance/2023/05/30/house-prices-updates/

Its interesting that UK also saw big price boom during covid period. They are quickly approaching year on year drops being reflected in the figures. Will be interesting to see if that prompts bigger drops.

Ireland are a bit behind UK on rate increase process.

But hey, this next next year we could be looking at another 10 percent increase, who knows.😀

Irish depositors can get a rate of 3.6 percent via Raisin bank. Over a short 6 month term. Of course they would have to essentially move their money outside the Country. Risk free and guaranteed.

The best mortgage rate currently available is less at 3.55 percent via Avant.

What this does mean?, seems bizarre. This points to some kind of dysfunction in the property\banking market. I don't know if it points to down or up though 😂.

Carrot really at this point I think all of the carrots are gone, I mean how much more carrot do they need already First time buyers grants, help to buy grants, rebuilding Ireland home loans, 3 to 1 going to 4 to 1 with regards to mortgage lending ratios, not to mention the favorable rental rates local councils are paying for REITS and other investors to buy and rent to the local councils, then HAP so those on the lower wage can rent then of course the corpo tax rates....All of which have aided in upping the price of our housing market. The carrot has been tried and tried time for the stick we need a real upping of vacant site taxes 10% a year would see these boyos building or selling and getting someone else in who can do it cheaper. Sinn Fein have been very vocal about developers and how they will be dealing with them and it isnt carrot.

Almost all projects are done on a phased basis its very rare to see development x 200 houses all built together, normally they do it blocks of 20/30/40 sell these then use the profits to build the next lot so regardless of the commencements the most recent lot of houses built (completed) will be under huge price pressure put it this way the norm has been phase one house A costs X and Phase 2 House B costs X + 5%/10% this will be reversing. Also Selling prices are decreasing (no maybe about it) and if interest rates hikes keep going up (another 2 before the end of July) we will definitely be in a recession by the end of the year

I dont think we are far from an exodus from the Irish banks. The Irish have big deposits earning nothing, eventually people will wake up and start pulling money out.

Imagine if someone like Revolut were to offer a fixed term deposit rate.

If people start pulling money out, banks would be forced to start upping there own deposit rates and their mortgage rates which could squeeze affordability further.

Really depends on whether they want developers to build. If developers aren’t confident about profit/sales, then they will not build, that is the reality.

I really don’t get the enmity some have towards developers, they are business people like any other. Even if they do build in phases, they won’t want unfinished sites because sales dried up or costs are too high. If there is a recession looming, plenty of business owners will be carefully weighing up whether now is the right time to be investing.

I think the issue here is for the vast majority of people, they don’t have ‘that much’ on deposit. Even if you had €20k. If you could manage to get even a 2% return from a bank. That’s €250 odd after DIRT. Hardly worth the hassle.

For those with bigger sums to invest (typically older). They won’t trust the likes of Raisin or Revolut (and I’d tend to agree with them).

People can already get nearly 3% on Irish government bonds if they just call up Davy and get them to administer it (there is some cost but it’s still well worth it). But the reality is the vast majority don’t bother because it’s just not worth the hassle/they’re not financially literate enough to look into it.

I really doubt the Irish banks are too concerned about a run on deposits seeking higher yield at this stage.

The banks are using the low deposits rates they are paying to subsidise mortgage rates. They are still awash with deposits and the lack of competition means they are not afraid of people moving funds chasing rates.