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

No not really. Housing spend was less than 6% of government spending in 2023. It’s less than the GROWTH in Health spending in the last 5 years alone.
In terms of your comment on ‘washing its face’, the figure you’re quoting is purely the budget allocated to spending. You don’t have the numbers on what it’s generating on the other side as all of the income is allocated centrally. The €6bn is not a ‘net spend’ because the DoH don’t receive the stamp duty, income tax, VAT etc. that housing generates.

I’m pretty right wing but even I accept there’s going to always need to be some spend on social and affordable housing. So if you could even optimistically halve that €6bn it really makes no difference to the overall finances of the country.

On FG not being centre left. Of course there is a spectrum, and I agree property taxes are far far too low in this country (again, the biggest opposition party want to abolish this altogether) but they’ve been in government for 16 years which has seen us

• have the most progressive income tax system in the world, which redistributes wealth inequality more than any other country
• Introduce RPZ zones
• Increases in HAP, Social Hosuing, Affordable purchase etc.
• Eviction bans
• Unprecedented growth in state spending on health and welfare

There will definitely be some counter examples (e.g. upcoming inheritance tax nonsense) but on the big areas issues of taxation and welfare it’s very difficult to say Ireland is not being governed as a predominantly left wing country.

Much of the things you have given out about in your posts, all opposition parties want to do, but in a more extreme way. You’re giving out about left wing policies and saying you’ll protest that by voting more left. I don’t see any logic.

Agree you can complain but what are you actually going to do? Vote for one of the even more anti landlord/higher tax parties?

Thats why it makes sense. You only need to be slightly less anti landlord than all the others to maximize your votes.

Id have some hopes that with their new 5 year mandate under Harris that FG will go back to what they really think rather than pandering to pick up some centre left votes. Time will tell.

They're CSO statistics, and quoted from an Irish Times article, so the truth of them isn't really questionable.

Some more probably relevant quotes

"First, despite all the noise in the market the vast majority of landlords (86 per cent) own only one or two properties. Most of them own one.

For sure the 1.2 per cent of commercial landlords at the other end of the scale with net rental income of more than €100,000"

According to the same CSO figures 22.8% of landlords have only their rental income as income, and 16.5% of landlords have only pensions or welfare as any other income on top of the rental income.

So the idea that "most" landlords are earning in excess of €100k a year (even from all income sources combined) and so would be hit by income tax increases on that demographic seems very unlikely given all those figures.

No not really. Housing spend was less than 6% of government spending in 2023. It’s less than the GROWTH in Health spending in the last 5 years alone

Your post ignores that the Department of Housing spend is increasing house prices and rents not making them more affordable. As a result homeowners and renters can't afford health insurance, pensions, and childcare.

This means that the state has to subsidise these areas more. I've given the example of a family earning more than mine who qualify for medical cards due to there rent spend. Is this a phenomenon that is increasing or decreasing? We are talking median to average salaried couples with children. Childcare costs in Dublin were double the cost of Limerick, what's the difference? Property prices. How many families qualify for family income supplement as a result of extortionate rents/ high mortgages.

I could go on and on but much of the increasing spend in other departments is directly linked to high property prices and extortionate rents. The direct beneficiary of this spending are the friends of Fine Gael: Land hoarders/owners, developers, investment funds

Do you still belive that FFG are left wing?

How much tax and economic activity is foregone by untaxed extortionate rents leaving the country to foreign investment/private equity funds. No contribution to the services that allow those properties exist and now the state is paying upto 130,000 per unit to build these. When are taxpayers going to wake up and take note of this state sponsored theft

Higher property prices mean higher insurance and maintenance costs

We all want lower taxes, we are not going to achieve this by using those taxes to pump property prices, you might get the illusion of lower taxes for a while, but continuation of FFG policies and you'll be back at 2010 levels of taxation if not 1980's levels

If you think about it, the current policy of affordable housing being built/financed by the state then sold off for good is as stupid as the policy of selling off social housing to tenants.

The govt needs a pool of social and affordable homes in the country. But once you sell on an affordable home today it is gone from the affordable market and instead exists in the private market.

Having affordable housing sold on within the scheme actually makes sense. Otherwise you are just transferring state assets to private speculators who will later profit.

Current affordable home buyers could make a mint in 10 years time with the price differential between affordable purchase and private market that they can then sell through.

It certainly has potential. There is scope here to have a positive private sector involvement. Many employers are frustrated with the governments inaction to the point that they are providing housing for employees themselves.

With this scheme there could be the opportunity for those employers to source land for the Scheme. My employer does this in the USA, does wonders for there ESG score.

High probability that homes would be built where they are needed bringing environmental and efficiency gains rather than long commutes of current policy

Would make a refreshing change from the private sector FFG are mingling with whose sole objective appears to be milk the taxpayer for everything they can get

Should be a token rent payment for the Land imo 1k per year rising with inflation. Servicing sites is not cheap and as these are aimed at median to average income, they can afford it.

Notable that they appear to be confining the scheme to 2 bed units. It kind of encourages turnover thereby potentially maximising the number of couples families that may benefit as well as addressing the shortage of 2 bed units in the market. 1/2 beds are needed at a life stage where your income may be lower (career start/finish)

Apologies if this comes across as a party political broadcast. My concern is that why are they coming out with this now when they have been mouthing on about housing for years and we have to wait till September for there full housing policy.

Shades of political football

Maybe they need a new leader then, I heard that interview she did before the local elections and she was all over the place on an issue they were gathering most support

S&P 500 has fallen to levels not seen in….40 days.

Reform of Council Tax comes up every now and then since the current bands are based on notional 1991 valuations and there are a whole host of anomalies (e.g guess where has the lowest charges). My hunch is they will leave it alone since Council Tax revenue goes to local government rather than central.

any thoughts - is the government's first home scheme which is essentially an interest only loan to be repaid in full at some point in time a blatant attempt by the government to break central bank lending limits - and if so how come the central bank are not more vocal about it

I’d have said the same 6 months ago, but with how SF have fallen it’s hard to see anything but another FF/FG coalition now. FF would be crazy to go in with SF also, it would decimate them.

FG move to the right economically is already evident under Harris.

https://www.rte.ie/news/politics/2024/0801/1463035-ireland-politics/

Im very hopeful of a stronger FG led government with Harris leading out with what Varadkar said he’d stand for but never really did, knowing he has 5 years to make some changes

There would also be civil unrest should it come to pass

It doesn't. But a bankrupt council or two will piss off fewer people than another tax rise.

Years of mismanagement by conservatives with our own crew copying the worst of there housing initiatives

how can you possibly say that…it was a labour government who’s belief for over 100 years is more tax to pay for an increase in public spending. Its not something that needs to be spelled out.

I'm a labour voter and one of there policies is a huge contributer to why your taxes are falling. Free third level education brought the Celtic tiger economy zooming up the value chain leading to record tax receipts

Do you think FFG squandering your taxes to the tune of upto 40/50% per unit to provide a unit of housing to one private citizen when we are on record wages will help reduce your taxes

It is astonishing that our best, brightest and consequently our best paid are unable to see this, maybe they are too busy to give it 5 minutes thought.

Everytime labour have been in government, the country has been in a much better position financially, economically and sustainably than when they took over.

Additionally when tough decisions need to be made, they did it regardless of whether it damaged the party

In the UK, Years of conservatives privatising public services has resulted in investment funds asset stripping, loading with debt, collect the bill payments with little investment in infrastructure meaning services are no longer fit for purpose. Continue untill taxpayer bailout is required

Which is more damaging for taxpayers?

serious wobbles in stock market at moment with japan seeing biggest drops since 1987 and likes of warren buffett offloading huge portion of apple to build 277 billion dollar cash war chest

oil at 7 month lows despite major war brewing in middle east

wonder will see more ecb interest rate drops to help drive more property prices rising here

VIX (fear guage) up 170%

This is going to keep happening as long as there are no consequences for this kind of behaviour. I don't know whether this qualifies as illegal behaviour, but it is ethically bankrupt. Keeping your word and honouring an agreement should be fundamental to doing business, and in most cases they are.

However, it should be noted that the property owner is at fault here too. The houses would not have gone sale-agreed without the owner's agreeing to sell his/her property to the potential buyer.

I bought in the last couple of months, believe it or not the estate agent didnt pass our €10,000 higher bid to the sellers. Suspecting something was up I knocked down to the sellers myself and they informed me that the estate agent said "the people viewing over the weekend were not interested so you might aswell just accept the only bid available".

Despite me having email proof of the €10,000 higher bid. Needless to say they fired the EA on the spot and went with us.

This EA is fairly popular in the Dublin market, whatever about trying to scam buyers but ripping off sellers is fairly unbelievable.

It wasnt that EA no.

Thanks very much :) and yes its one of the most stressful experiences i've ever had, delighted to be done with unscrupulous EA's.

It's a long road and we lost out on another house which was probate despite having a higher bid under slightly weird circumstances where you can't just knock down to the house because nobody lives there.

The EA pressuring the sellers to accept an offer on Sunday despite us viewing it on Saturday and informing them we would be bidding, after the sellers wanted to wait until Monday to see if any other offers came in the EA hilariously said " you'd only be beating a drum thats already been beaten".

A friend of my family is also an EA and she put it well by saying "there is pressure from every corner, family, friends neighbours to tip the scale in somebodies favour, especially in this tough market."

It was exactly at asking price, not a euro more. The EA continued to say we never bid despite us having and showing the sellers proof. Granted it is good to give people the benefit of the doubt but in this case unfortunately they were crooks in my opinion.