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

You don't have any source for the amount of first time buyer grants drawn down last year by any chance

https://www.revenue.ie/en/corporate/documents/statistics/tax-expenditures/help-to-buy-annual-report-2023.pdf

7,200 total. C.75% for non self build. So let’s say 5,500 rounding up.

60k property transactions last year for non self builds. So HTB is a MAXIMUM (not everyone will be eligible for this maximum due to not paying €30k in tax) of 10% of the purchase price in less than 10% of the houses bought last year. So you’re talking significantly less than 1% of the money being spent in the market last year coming from HTB.

EDIT. Used some more numbers in the reports. Of the money spent in the property market in Ireland last year. HTB represented roughly 0.5% of it. As I’ve said previously. It’s a drop in the ocean. Shared equity is even less.

in with the estate agent today and she said they could already see signs of strain with people paying e.g. 340k for houses the estate agent only felt were worth 280k could be quite a few burnt over the next while if this continues

I don’t see any rationale why HTB would be having a YoY inflationary impact as it has not be altered since 2022? (I agree there may be some overall inflation in certain smaller cohorts in absolute terms).

If anything on a YoY basis the HTB should be deflationary as its relative power in less than it was in prior years due to the non indexing cap and value.

Only possible inflationary angle would be people earning more, so on average obtaining more of the maximum grant than previous years.

Last time I checked FHS was barely off the ground. Not sure the long term scale planned and if it could become inflationary. From what I remember the caps are very restrictive to the point it won’t be much use in Dublin and surrounds (similar to FTB)

I’m not seeing the same numbers as you. I wouldn’t compare new builds to second hand as they just behave differently. There was a period in 2020 when second hand houses were going way up and new builds were flat. Then recently second hands were falling but new builds increasing. I think there is a lag based on the way new builds are sold with long delays to closing so YoY comparisons are distorted.

So just looking at FTB vs SSB new builds. 2018-2023. FTB up 21%, SSB 21%. 2022-2023 only. FTB 7%. SSB 9%.

There’ll be some volatility in the above so I’m not saying it factually proves HTB is absolutely not inflationary. It probably is. But it’s a rounding error if it is. It gets weaponised by certain political parties and unfortunately some young disenfranchised people catch onto it and genuinely believe with all their heart that if it’s removed that prices will fall dramatically (hint: they won’t)

The total spend on HTB over the last 7years since it was created is €0.9bn. The total value of property transactions in 2024 alone was c. €20bn. It’s a fart in the wind. A complete and utter red herring.

any thoughts on HTB and FTB schemes - are they worth signing up for or is it a terrible idea to have the government involved in owning a portion of your new higher priced house when you may have been happier to buy an older cheaper house in the first place

How many new build completions actually make it onto the open market where HTB/FTB buyers can actually get hold of them? Or is it just apartments that are being hoovered up by funds..

Thought councils were doing more buying up of individual properties rather than buying entire developments. Not that it makes much difference to the wannabee owner-occupier which deep pocketed organisation they are competing with..

Now use this mechanism to go after those that use the planning system for extortion

That what stands out most, in a year of 35k first time buyers only 5k purchased new homes with all the subsidies. Is the price gone beyond the vast majority of ftb

Another bit of related info was that the top 7.7% pay more than 50% of the income tax. If this is the case that 7.7% seriously skews the average wage in the country, which begs the question what is the average salaries of the first time buyer demographic

just use median instead of average!!!

I understand the sentiment as people will indeed always find something to moan about, but this is absolutely not unique to Ireland in any way shape or form.

And as things to moan about go, the state of Irish property market is a very, very easy target.

One of the biggest problems and this is an article in the FT today; is that inflation is potentially worse than a recession, but it is not easy to measure this for individuals. So, when people think of 2008-13 they think of a recession whereas 2021-24 have been inflationary which is utterly obliterating so much of people’s income, that it “feels” like the years of 2009-13 but just a bit different in a way that maybe cannot be accurately, verbally explained by people but they can sense it and see it in the amount of cash they have at the end of each month.

Property acts as an inflation hedge so it makes sense that less people are being hit as hard as they would have been 2009-13 given the number of homeowners in the country but at the same time they are not immune. The big losers, suffering equivalently to how they did 2009-13 are younger people and added to this for this era are those that are renting, who probably feel like they are working to stand still due to inflation. We had massive unemployment 2009-13 and this is bad for the whole economy but it is pretty bad for the individual to be working to stand still, possibly even worse given the time and effort that working entails.

This is not all to say that 2009-13 was better than 2021-2024 but that these last few years could be said to be on a slightly better level than 2009-13 because inflation can be and absolutely is awful for those impacted. Renting and not being able to squirrel away decent savings means many people are drifting along aimlessly in life due to inflation and home ownership is that life raft just out of reach.