I'm a bit confused by this - there has been no indicators that the supply of new housing is reducing, so where does this fit in?
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Because in the past few years I have become a fully paid-up believer in capitalism (with a splash of very moderate socialism).
I genuinely believe in an asset being priced as a function of the income it generates, and that the market will eventually (and possibly ruthlessly) erradicate asset valuations which are based on non-tangible factors such as emotion and groupthink.
In fairness to the journalist, he's gone against the VI grain with this comment....
200 & 216 Premier Square on the Finglas road, Dublin 11 both dropped from EUR370,000 to 355,000.
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It will be interesting to see what the next phase of Prospect Hill will be priced at.
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It will be interesting to see what the next phase of Prospect Hill will be priced at.
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partisan
Guest
Yeah let's not get carried away (yet). It could (and most likely was ;-) ) be caused by poor inventory management and the loss of a major contract to a competitor (rather than a reduction in order size).
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phoenix_n
Guest
If you put your ear to the train tracks and can hear the train you dont wait until you have to see it to decide to move.
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Guest111
Guest
Right...new house building is at an all time high, some production manager got his sums wrong. Yeah, the crash is here!
For gods sake...
For gods sake...
I think they're still overpriced. I couldn't understand why the prices on Premier Square were as high as they were and yet people still appeared to be buying them.
Look at most of the apartments (which in Dubilin seems to account for most units) built over the last few years. While some of them still use bricks and blocks most of them are poured concrete with pre-fabricated facias and glass. The brickies priced themselves out.
Just speculation, but maybe some developers have switched to timber-frame construction in order to speed up completions?
Bear in mind also, that there could be a localised reduction in construction in Kilkenny (where the factory is located) and/or a planned development may have been cancelled.
..and Ben that's worth alot. I know several people in "starter homes" where they are very uncomfortable in the area they find themselves in. I hate to sound snobbish but I really cringe when I go to visit these areas. Thankfully the only truly bad thing to happen to any of them was one couple who were forced to sell up (and thank God they could..) in finglas due to truly horrible harassment.
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Debtwish
Guest
Strictly speaking, it is probably correct to say that the crash isn't here. But you can't say it because new house building is at an all time high - that's generally a precursor to a correction as supply overshoots demand and that is without the minor little detail of supply of housing already far outstripping need for housing (demand being a slightly different beastie - but rents are largely stable and we have a massive rate of unoccupancy).
However, to deride the considered opinions of a lot of people here who have put forward a hell of a lot of other reasons as to why a crash is possible and and increasingly likely in the way that you do does not give me great faith in the rationality of your argument. Asking prices are stagnating and that is a key indicator of public property buying sentiment. In some cases asking prices are falling and that is a key indicator of problems shifting properties.
You are perfectly at liberty to state that there will not be a crash, but arguments that amount to "there will not be a crash because you are wrong" which is more or less what almost every single one of your posts amounts to are hardly substantial support of your position.
1) we have over supply of housing
2) we have rising interest rates
3) housing price growth has slowed massively in the run up to a point three months ago and in the interim vested interests have been screaming that "it's never good in the summer anyway"
4) houses are staying on the market longer
5) we have rising utility prices and fuel prices making the cost of living far from work higher again
6) a significant amount of our economic growth is based on 1) debt driven consumerism and 2) debt driven house purchases. We owe a hell of a lot of money. Manufacturing is dropping and export surpluses are falling. We are getting into a dangerous position.
7) a lot of people in this country think it's okay to be heavily in debt because they don't know what it's like to be out of work.
Trouble is on its way. It is naive to pretend it is not. The point for a lot of people is that the longer we put off facing reality, the harder that reality is going to bite. What part of that do you not understand? Property prices eleven times average salary are not sustainable on a national basis, whatever about local variations.
sandymount
Registered User
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Dara deFaoite lives in Co Kilkenny with his wife Sue, daughter Jodie and their two cats. He has worked as a journalist for Ireland on Sunday, the Sunday Business Post, the Irish Independent and the Irish Examiner. A man with a life-long interest in the paranormal, he has spent many years rooting out mysterious stories often overlooked by his colleagues.
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Dara deFaoite lives in Co Kilkenny with his wife Sue, daughter Jodie and their two cats. He has worked as a journalist for Ireland on Sunday, the Sunday Business Post, the Irish Independent and the Irish Examiner. A man with a life-long interest in the paranormal, he has spent many years rooting out mysterious stories often overlooked by his colleagues.
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JayDub
Guest
LOL, funny how the production manager gets his sums right for 10+ years or construction boom, then screws up in a downturn. Yes building is/was at an all time high, but so are vacanies and ghost towns, especially in section 23 areas. There was no mention of lost contracts to other suppliers, just the following,
"Insiders at the plant now fear that the temporary layoffs are symptomatic of a downturn in the construction sector."
Arthur Daley
Registered User
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- 36
I'm in a similar enough position to yourself, but the thing is if it collapses by 20% then all bets are off. The fundamental economics haven't been right for years, so unless the VI can control the falls now or soon enough (think shutdown of supply of new zoned land and new starts) then i don't know where the floor could be? 2000 prices, 2001 prices?
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MadPad
Guest
"Insiders at the plant now fear that the temporary layoffs are symptomatic of a downturn in the construction sector."
Thats it! only question now is how bad is it.
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JayDub
Guest
The supply of new housing has probably not reduced as of yet, the bricks that build the current supply of housing were made and sold in the last 12 months. The bricks currently sitting in the yard would supply next years market. If the supply of bricks has exceeded demand, could the same not be said of the housing market.
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Guest111
Guest
Salaries and interest rates are the only big factors. There will never be enough houses in Dublin itself so demand will always be there.
even an ECB base rate of 5% is not doomsday...the market will just slow in accordance with each increase. It's not they're 3.25% today and 5 tomorrow (like the bad old days)
even an ECB base rate of 5% is not doomsday...the market will just slow in accordance with each increase. It's not they're 3.25% today and 5 tomorrow (like the bad old days)
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