"average Dublin house prices should fall to ‘the €300,000 mark" according to Many Lou McD.

Here you go, see details below.

The house can never be rented out, and can only be sold to qualified applicants.

See my multiple previous posts on this.

The government cannot control the lower end of the private housing market without impacting the entire market. The private housing market is a spectrum from the cheapest dwelling of 50K all they way up to the multi million euro houses. If you impact the bottom you impact the top, your idea is akin to taking weight off one end of a see-saw and expecting the other end to remain the same. ITs frankly ridiculous, nevermind from someone who says they studied economics.

The state can only control state/social housing, nothing else, or the whole market will be impacted (read broken).

And how do you separate house buyers into those two markets? Whats your criteria for who gets to buy a cheap SF 3 bed semi for 300K versus those who have to pay 400K for the exact same house 1 mile down the road?

I serioulsy dont understand how some posters on here cannot see that its the same bloody single market.

There will be an impact throughout the market.

But this won't be applied evenly.

It's called normal goods vs luxury goods.

Price changes on fast food don't impact much on luxury dining.

It's debatable the extent to which this principle applies to housing. But I'd be quite confident houses in D4 and the huge McMansions won't be impacted much by the availability of affordable housing.

And in case you haven't noticed the market is broken now.

The theory of the second part of this makes sense from a pure total transaction cost perspective but the practicalities of raising a deposit means it’s not so for most.

Most upsizers use the equity in their first house to fund the deposit for the next house. Sure the total cost is higher but they can borrow for that.

If they go into €50k negative equity they have to save €50k cash PLUS 10/20% of the next house value which is impossible for most.

Don’t disagree, just pointing out the flawed thinking that negative equity is actually helpful for upsizing.

Edit - well I actually do disagree with the ‘foolishly’ part. Most people are just buying houses to get on with their lives and have families. Prices may be high, but they cant help that. What is more ‘foolish’ - accepting the reality and trying to get on with it, or refusing to engage on a hope things might one day be cheaper.

Other than that, I agree with your sentiment.

Not everyone does it foolishly, but in the last crash there were a lot. That is why I said "may have" and I was referring to the sentiment in general, not just at this point in time.

We have to get away from the rush to "get your foot on the ladder now before you miss your only lifetime chance" setup. I have a relative married to someone who bought a house about 60 miles from Dublin during the boom, but who was working in Dublin, because he "had to get his foot on the ladder while he was still able"..........you can guess how that worked out...........but I won't say I don't understand why he felt he had to do it at the time. He literally couldn't afford closer and prices were moving away from him faster than he could chase them. The only apparent way to slow down the ones getting away from you was to get on the same train a bit further back.

It should be feasible for people to choose to rent as opposed to paying interest. So that they don't have the same pressure. Rental situation here is mental - landlords basically expect a passive investment along the lines of "grand, I got a loan and outbid that fella for that house. Here - you live in it for the next 20 years and pay enough to cover all my tax and mortgage repayments on it. Call me in 20 years when it's all paid off. Thanks)

I don't think that many people are practically moving up as is.

I think were it to happen, the government could back itself and make up the difference.

Perhaps the state could purchase that one-bed flat at the price originally paid and put it towards social housing. If it was bought within the last ten years it's not likely to be as expensive as the circa 500k the state is now paying developers for one-beds.

Or it could just make up the difference as part of the cost of fixing the last ten years of failure, funding by the economic benefits from fixing these problems.

Why? You need capital to be able to buy an asset and renting is often more expensive. We need to have affordable rentals for lower income workers in my opinion, but we don't necessarily need to have everyone buying.

Yep, I agree with all of this. I probably at times felt a lack of sympathy for those who bought in 06/07 as ‘reckless fools’

Then as someone who bought in the craziness of 2021 - watching prices run away as your rent goes up to €3k a month for a 2 bed apartment and knowing you could be turfed out on a whim with close to 0 rental supply all whilst hoping to start a family - it certainly makes you a little less likely to be a patient spectator when it comes to buying.

Rental properties would be bought at all different prices, so I am not sure the cost of the rental should be linked to the cost of financing it. We already have a restricted rental market where increases are capped.

Obviously if you can buy something for €1000 a month (€220k?) and it rents for 2k a month, it makes sense to buy it, at least at the moment. Interest rates can rise, rental costs can drop etc. That is purely from the point of view of the purchaser, but there is another perspective, that of the lender. The lender is concerned with making sure you have the ability to pay back the loan (which they have been rubbish at historically which is why we need the LTI restrictions), they aren't really concerned with what is cheapest for the person currently renting.

I am not referring to specific properties being linked to specific rents based on the cost of finance. I am talking about the principle in general that the norm is to exchange your cost of capital (which is the interest - and does not include capital repayments) plus a fair spread for the rental income

There are an awful lot of posters on here who expect the norm to be where the rental income covers cost of capital plus that spread plus the capital repayments after tax. That isn't rational. But the fact that we have a system which does that over the long term is a sign of dysfunction.

To my mind, the cost of the property, the amount left on the mortgage, interest rates, capital repayments etc are all irrelevant. The property rents at a price people are willing and able to pay. Obviously we have rental caps which benefit really just people who are currently in rentals. The only way to sort it is to increase supply.

I was renting in 2008, the following year after the economy tanked, I went to my landlord and asked for a 30% reduction. He had no choice as there was plenty of supply available. I didn't care if it was covering his capital or interest repayments (in reality neither I suspect, since it was bought in 2005).

"I don't think that many people are practically moving up as is."

So you think the housing market is static in Ireland at the moment? For reference the PPR has just under 60K houses sold in Ireland in 2023.

And how many of those are moving up to larger homes from one-bed starter homes?