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

wassie · 02-07-2023 12:01pm

Villa05 posted "the most environmentally friendly thing anyone can do is make what you have last longer. Current ESG policies widely discourage and penalise this". I queried what policies were being referred to. There is a subtle, but significant difference between policy and legislation. I wasnt calling Villa05 out, rather its because my understanding is that this is now the law and I was simply interested if there was something else at play I was not aware of.

Villa05 · 02-07-2023 12:57pm

A real money Spinner, this planning process

Residents of two housing estates in south Dublin received €3 million from a property developer last year in return for withdrawing a legal case against a proposed apartment development.

The settlement came about after the group agreed to withdraw judicial review proceedings against An Bord Pleanala over the construction of an apartment block..........

It is understood that the developer, who has declined to comment, was eager to start the project but with rising interest rates and a change in the funding environment, construction of the scheme has since stalled.

https://www.thetimes.co.uk/article/property-developer-gives-residents-two-south-dublin-estates-3m-65r8n9vm7

And

A former attorney general was among the home owners of a Dublin city centre street who were to benefit from a €1.65m pay-off from a developer to a residents’ association in return for it withdrawing an objection to An Bord Pleanála.

John Rogers, a senior counsel who was attorney general between 1984 and 1987, was one of the residents

https://www.independent.ie/irish-news/ex-attorney-general-john-rogers-among-neighbours-in-buy-off-deal-with-former-billionaire-developer-derek-quinlan/a1217137891.html

MacronvFrugals · 02-07-2023 6:03pm

Is this not absolutely bonkers? FF 2000s level proposals.

First Home Scheme must be expanded to include second hand houses – Cummins

The inclusion of older second hand properties must be considered for the First Home Scheme if prospective buyers are to be given every chance to buy a home, a Fine Gael Senator said.

“As we approach the first anniversary of the introduction of the First Home Scheme, a review of properties available through the scheme must be conducted to ensure prospective buyers are being given every opportunity to own a home,” said Fine Gael Spokesperson on Housing, Senator John Cummins.

https://www.finegael.ie/first-home-scheme-must-be-expanded-to-include-second-hand-houses-cummins/

wassie · 02-07-2023 6:32pm

Who wouldnt want an instant 30k bump to the house their selling....

DownByTheGarden · 02-07-2023 7:09pm

https://www.boards.ie/discussion/comment/120789370#Comment_120789370

Perfect example here

Clayton hotel charlemont

https://www.google.com/travel/search?q=hotel%20north%20richmond%20street&g2lb=2502548%2C2503771%2C2503781%2C4258168%2C4270442%2C4284970%2C4291517%2C4597339%2C4754388%2C4757164%2C4814050%2C4850738%2C4864715%2C4874190%2C4886480%2C4893075%2C4924070%2C4965990%2C4990494%2C72248281%2C72264422%2C72281254%2C72286089%2C72289744%2C72296744&hl=en-IE&gl=ie&ssta=1&ts=CAESCgoCCAMKAggDEAAaXgpAEj4yJTB4NDg2NzBlNjIxZmU0ODFkMToweDRjMDY1NDE4ZjdkMWY5NmU6FVJpY2htb25kIFN0cmVldCBOb3J0aBIaEhQKBwjnDxAHGBMSBwjnDxAHGBQYATICEAAqBwoFOgNFVVI&qs=CAEyJkNoZ0k4OVNyOGZHTHZEd2FEUzluTHpFeFoyNHhlSEk0WWpVUUFROAZaAggB&ap=KigKEgmebaUP_6lKQBFkmZ_VDgsZwBISCfTEhHK4qkpAEWSZn1XRBBnAMABoAQ&ictx=1&ved=0CAAQ5JsGahgKEwjYvK_tzvD_AhUAAAAAHQAAAAAQpgE

OEP · 03-07-2023 7:55am

https://www.boards.ie/discussion/comment/120788016#Comment_120788016

They do describe it as a point in time estimate in the links I provided

hometruths · 03-07-2023 8:21am

https://www.boards.ie/discussion/comment/120797919#Comment_120797919

They describe the census as a "point in time measure". It's not an estimate. That's the whole point of it.

Direct comparisons between vacancy rates obtained from the Census of Population and within this publication are not possible due to definitional differences. The Census classes dwellings as vacant when they are unoccupied as of Census night, are not used as a holiday home and are not usually inhabited by occupants who are temporarily absent at the time of Census. This is a point in time measure, while vacancy as indicated in this publication is based on at least four quarters of low electricity consumption. Although the Census vacancy measure includes dwellings that have been vacant for longer periods of time, it also includes dwellings which are unoccupied for potentially very short periods such as between rental tenancies.

OEP · 03-07-2023 9:22am

https://www.boards.ie/discussion/comment/120797968#Comment_120797968

Grand, measure. Either way, there are two numbers compiled by the CSO with a large discrepancy between them. You have decided to cherry pick the one that suits your argument, as opposed to considering both numbers and concluding that it's more likely the real number lies somewhere between the two.

hometruths · 03-07-2023 10:37am

https://www.boards.ie/discussion/comment/120798138#Comment_120798138

There is a large discrepancy between the two because they're measuring different things.

The census measures how many properties are vacant at a specific point in time for whatever reason - for sale, rentals between tenancies etc.

The electricity consumption measures how many properties are vacant for a prolonged period of time - 1 year.

It is entirely unsurprising that the electricity measure would be substantially lower.

I'm not cherrypicking anything. My argument is that the census shows a surprisingly high figure of vacancies for that point in time. The headlines of homelessness, lack of available rental stock, lack of available sales stock etc would suggest that figure should be much lower.

The fact ESB measure is lower than the census is entirely irrelevant to this argument, because they're measuring different things.

flexcon · 03-07-2023 12:03pm

This has become a silly situation now.

What are peoples thoughts here.

A) buy a house at the peak, with peak interest rates - but start a family right away. (both 33)

B) Start the family now (We have good security from the landlord, not really worried) and wait for all of this to blow over, but risk getting less of a mortgage as we now have child costs

Timing belt · 03-07-2023 12:10pm

https://www.boards.ie/discussion/comment/120798790#Comment_120798790

can you define what your expectation ‘blow over’

Are you expecting rates to drop or/and property prices to drop and if so by how much over what period

herbalplants · 03-07-2023 1:32pm

https://www.boards.ie/discussion/comment/120798790#Comment_120798790

I would suggest buy a house first before having kids,have a secure roof over your head having kids.

syrgian · 03-07-2023 1:57pm

https://www.boards.ie/discussion/comment/120798790#Comment_120798790

I was there 3 years ago (Now 34), but slightly different proposition: kids then, in the rental, or kids ~1 year later if we managed to find and buy a house we liked. We hated that having kids would depend on the depressing housing market. So now we have two kids, no house, but looking to buy one. Childcare costs are enormous: either you pay or one of you doesn't work. We went with the second option. We could afford a much larger house if my partner worked, but I will tell you that we don't care at all and we are certain we made the right decision.

And buying a house before the kids, without childcare costs, and then having the kids is not just tricking the bank, it's also tricking yourself. It's putting you in a much worse financial situation, because you will need to be able to afford both the mortgage, possibly additional increases to cost of life, interest rates increases AND the childcare. Plus the childcare is not even granted in many places in Dublin (despite the high prices), from what I have seen. What do people even do if they don't find a place to leave their kids at?

My recommendation to my past self, which might or might not apply to you: Have kids now if you are prepared. Have a stay-at-home-parent if you can afford it (take into account the joint assessment of taxes plus the home carer tax credit vs childcare costs). Kids don't care at all about where the are living for the many first years of their lives, but they care about having their parents around and happy. But if you stay in a rental, have a plan to settle before they start primary school, so they have stable schooling.

Disclaimer: We have a backup plan. If things got very bad and we couldn't afford a house here before we got evicted, we would have left Dublin (or possibly Ireland) entirely and go back to our cheaper cost-of-living country.

flexcon · 03-07-2023 3:14pm

https://www.boards.ie/discussion/comment/120798827#Comment_120798827

I am expecting rates to drop. We have more than enough for deposit, but really feels like buying at peak of both interest and property price. we are looking at near 2000 a month on the mortgage, where as 2 years ago it would have been 1500. feel horrific!

wassie · 03-07-2023 3:18pm

https://www.boards.ie/discussion/comment/120799317#Comment_120799317

Great post and highlights the challenges of families in the housing market.

quokula · 03-07-2023 4:22pm

https://www.boards.ie/discussion/comment/120798790#Comment_120798790

This question only makes sense if you know what the peak is. Many people 2 or 3 years ago were holding off to avoid the peak at that time.

Timing belt · 03-07-2023 5:24pm

https://www.boards.ie/discussion/comment/120799807#Comment_120799807

Were you in a position to buy 2 years ago?

DataDude · 03-07-2023 6:02pm

https://www.boards.ie/discussion/comment/120799807#Comment_120799807

If you think rates will drop materially soon then you should DEFINITELY buy now.

You want to buy at ‘peak interest rates’ as higher rates generally put downward pressure on price (as we’ve seen lately)…and you’ll only pay that peak rate for a couple of years.

As rates then fall you’ll get to spend the majority of your mortgage years on lower interest rates having purchased at cheaper price due to the high prevailing rates at the time of purchase. As rates fall, prices will rise again meaning you’ll have timed it to perfection.

I don’t think we’re at peak mortgage rates for what it’s worth and I don’t think they’ll fall anytime soon but that’s just my guess…

Mr Hindley · 03-07-2023 6:32pm

I'd agree that interest rates probably have a little higher to go. But I'd also say that we're only starting to see the impact of the rates on house prices - that will take months to feed through into the situation on the ground in terms of what people are bidding etc.

I did hear on the radio that the number of mortgage approvals was at a record high, though, which goes against the whole narrative of higher rates depressing house prices, so who bloody knows what's going to happen at this point...

flexcon · 03-07-2023 6:50pm

https://www.boards.ie/discussion/comment/120800372#Comment_120800372

Yup! Problem was total lack of supply meant really compromising on location. At least now, some houses are coming up in the location.

DataDude · 03-07-2023 7:02pm

https://www.boards.ie/discussion/comment/120800658#Comment_120800658

Possibly, mortgage rates in Ireland are still low (although AIB news last week is changing that). Once that changes I’d expect price impacts (if there are to be any) will be swift, as they were in other countries. Every single new buyer is impacted immediately, there is no lead time for them in terms of bidding.

On your second point. Hindsight is always 20/20 but given where rates were, property in Ireland really was extremely cheap back in 2019/20/21. I still have screenshots of the 30 year Avant mortgage, fixed at 2.5%. That meant the interest on a €1m mortgage was less than the rent on a 1 bed apartment in Tallaght. The mortgage was guaranteed for life. The 1 bed in Tallaght would be going up 3/4/5% a year for the 30 years.

Prices really should have gone much higher with finance that cheap, but prices were kept in check by the restrictive lending rules. The fact we never really got the crazy ‘boom’ in prices from low rates, means I think we won’t get the crazy bust from increasing rates.

Ability to repay mortgages has never been a problem, it’s just been getting a mortgage which has been the issue. That has remained unchanged with rising mortgage rates, and if anything gotten easier with the 4x lending change.

drogon. · 03-07-2023 8:32pm

https://www.boards.ie/discussion/comment/120800658#Comment_120800658

Couple of points to add, rents are still at all time high. In that for a lot of people, paying a mortgage will still make them better off than renting. Especially if they are looking for a new tenancy. I know few people at work, that have lived here for over 15 years (mainly from the continent) and have decided to buy because of rental prices.

I live in Dublin, and live in the same area since 2004. Prices only reached the peak of 2007/08 during the bidding frenzy of 2022 ! For the most part, prices have been fairly content - especially in Dublin. Going forward I personally don't see people paying 100K over asking prices like we did see last year, so yes prices will drop when you compare it to 2022 prices, but if you compare them to prices of say 2019 it might be a very nominal drop.

Overall the rental crises really needs to be sorted to relieve any pressure. This includes the large government subsidies in the private rental market. Last year over 50% of renters got some form of subsidies like HAP. This unnecessarily puts pressure on renters who don't qualify for any government support. This really annoys me, as HAP was a introduced as a temporary measure to use private rental market for social housing until the local councils got enough supply, unfortunately this never happened and all they kept doing was expanding the scope of HAP.

GoingLinux · 03-07-2023 8:41pm

Are prices really falling around Greater Dublin Area commuter counties, or just moving sideways? By which I mean, people are being forced to buy a lesser house, with people at the bottom being squeezed out.

hometruths · 03-07-2023 8:52pm

I see the vacancy nonsense has reached the letters page of the Irish Times.

Sir, – John McCartney (“Ireland has many housing problems. But lack of supply isn’t one of them”, Opinion & Analysis, June 27th) argues that undersupply is not a feature of the Irish property market, on the basis that Census 2022 shows an overall home vacancy rate of 7.85 per cent. Census data is notoriously unreliable as a source of actual property vacancy figures, as the only criterion is that nobody is home on census night. Official CSO vacancy figures are based on low or zero electricity consumption over a 12-month period and are a much more reliable indicator that homes are being left unoccupied for long periods.

It's absurd. For example the author says: Census data is notoriously unreliable as a source of actual property vacancy figures, as the only criterion is that nobody is home on census night.

Notoriously unreliable? Only according to the narrative. As as for "the only criterion is that nobody is home on census night", it is just pure fiction that somehow has become widely accepted as fact. The CSO specifically state this is not the case:

A dwelling is classed as vacant by census enumerators if it is unoccupied on Census night, is not used as a holiday home and is not usually inhabited by occupants who are temporarily absent at the time of census.

The point of the vacancy count is to identify properties that are uninhabited on Census night, not chalk them up as vacant if the occupants are away for the weekend:

Census enumerators adhered to detailed procedures that have been developed by the CSO in consultation with key experts across several censuses. As part of these procedures, enumerators varied the times of the day, and days of the week, they called to dwellings in order to make contact with householders. For example, when an enumerator called to a home during the day and failed to make contact, they dropped off their contact telephone number on a calling card. The subsequent visits were at different times such as evenings and weekends.

Enumerators also looked for signs of vacancy such as post and junk mail building up, no lights on at night, no cars in driveways, overgrown gardens, or no windows open. If they observed any signs of occupancy, they could not record the home as vacant. Where they could not make contact with a particular household, the enumerator checked with neighbours to enquire about the dwellings. If neighbours told them there were people living in these dwellings, the enumerator could not record them as vacant.

And these visits occurred numerous times between March and May. If there was evidence of occupancy on any of those visits, the property was not recorded as vacant.

And the author again goes on to say Official CSO vacancy figures are based on low or zero electricity consumption

Official CSO figures?! As in the census figures are so notoriously unreliable they are "unofficial"?! Says who. Certainly the CSO don't consider the electricity consumption figures as the "Official CSO vacancy figures". Quite the opposite, as mentioned in a previous post they regard them as experimental:

CSO Frontier Series outputs may use new methods which are under development and/or data sources which may be incomplete, for example new administrative data sources. Particular care must be taken when interpreting the statistics in this release.

Again, the idea that the electricity figures are some sort of best in class vacancy date is a pure fiction that has somehow come to be regarded as fact.

The reason the whole "Ah sure you cannot trust the census, that's clearly wrong" spiel annoys me so much is it a perfect example of the power of the narrative related to housing in Ireland. For some reason people are adamant that black is white, and they're utterly convinced of it - the letter writer in the Irish Times is just one example of many.

https://www.irishtimes.com/opinion/letters/2023/07/03/housing-supply-and-demand/

https://www.cso.ie/en/census/census2022/census2022andvacantdwellingsfaq/

the.red.baron · 03-07-2023 9:11pm

https://www.boards.ie/discussion/comment/120801257#Comment_120801257

Who runs the census

What makes you think you know more about stats than them

If the vacancy rates are high doesbtbthe market reflect this

the.red.baron · 03-07-2023 9:13pm

https://www.boards.ie/discussion/comment/120800779#Comment_120800779

Did anyone ever draw down on this avant mortgage though?

hometruths · 03-07-2023 9:15pm

https://www.boards.ie/discussion/comment/120801342#Comment_120801342

I am not claiming I know more about the stats than the CSO who run the census. That's ridiculous. I am claiming that the people who claim things like the census is notoriously unreliable do not know more than the CSO.

No the market does not reflect the high vacancy rates. Therein lies the problem.

the.red.baron · 03-07-2023 9:20pm

https://www.boards.ie/discussion/comment/120801355#Comment_120801355

If they were happy with the vacancy rates in the census why create another batch

Other than the census is run every 5 years only so not much use

And has the above mentioned flaws

Why would they state the numbers in the census should not be used for long term vancancy rates on their own website

Time to drop this sillyness

https://www.cso.ie/en/census/census2022/census2022andvacantdwellingsfaq/

hometruths · 03-07-2023 9:32pm

https://www.boards.ie/discussion/comment/120801385#Comment_120801385

If they were happy with the vacancy rates in the census why create another batch

The CSO were happy with the vacancy rates in the census. They stoutly defended them. They didn't see the need to create another batch. That's the point. It was various other interested parties who claimed there was something wrong and there was a need for "better" figures. Are you suggesting they know more about statistics than the CSO?

Why would they state the numbers in the census should not be used for long term vancancy rates on their own website

Because the census is not designed as a long term measure. It is designed as a measure of vacant properties at a point in time. Again that's the whole point.

The vacancy figures at the point in time in April 2016 and April 2022 are way way higher than you would expect given market conditions, availability etc etc.

It doesn't matter how many measures of long term vacancy you devise to specifically measure long term vacancy, it does not change the fact that at the point in time of the census the vacancy figures were extraordinarily high.

the.red.baron · 03-07-2023 9:39pm

https://www.boards.ie/discussion/comment/120801432#Comment_120801432

on their own website they state that the census is not a measure of long term vacancy rates

That's is what the other stats are for

That's why the on the day vacancy rates are higher they always will be

This is getting beyond silly now

Definitely in 5g territory

They even list some items that are actually not vacant that are included in their numbers

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

Comments

First Home Scheme must be expanded to include second hand houses – Cummins

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