House Prices

Developers

They are not putting any of these profits back into the community. No money back for infrastructure. Bord Pleanala how are you?

That is not the case at my estate. The developers made considerable contributions to the cost of upgrading the roads nearby in exchange for planning permission.

I thought that would be common practice?
 
Developers

Joxer, look at the mess about to happen out in Greystones. Thousands of houses, little provision, winding country roads, objections overturned by Planala, I could go on.

Joxer you can bet the road improvements mean cycle lanes that end in a ditch, wide roads that suddenly turn into unlit country lanes. No shops, no transport, no recreational facilities, houses where you don't have room to swing a cat, poor sound insulation, poor materials and shoddy workmanship lets you hear the sound of your neighbours making love, where visitors can't park infront of your home because there is no room etc etc etc..
 
I showed a house to a French guy that I knew (he works in the home letting industry over there and was over for a few days with his family) and for pig iron we stopped by a house for sale and I asked him to guess the asking price. €200k was his first guess. 'non' was my reply. Try again. Raisuing his eyebrows €250k was his next guess? he went on €300k? At this stage I could see complete disbelief in his eyes. By €600k he gave up thinking I was having him on. The asking price was actually €1.2m. This left him in a complete state of stupefacation.

There is a great piece in the Sunday Times each week which shows you a house on the continent and a similar house in Ireland and you've to guess the asking price of each.

Lets face it. The property crisis here has us the laughing stock of Europe.
 
If first time buyers pulled together and refused to buy then the market has nowhere to go but down but cleverly placed adverts in local and national papers even the radio are conning people into thinking "qiuck quick buy now before it's too late!" this is simply not the case these builders and lending institutions are creating first time buyers to panic buy by fooling them into thinking that prices will never fall.
Its a simple rule folks what goes up must come down....sometime :\
 
Its a simple rule folks what goes up must come down....sometime
Click to expand...

I've been praying for that to happen to the price of a pint for years now, to no avail !!!
 
Very good article IMHO, in today's Irish Times by Dan McLaughlin. He analyses the UK property crash in the 80's in the context of whether the same thing will happen here. Basically he says it won't happen here and that it was'nt really as bad as they say in the UK when the crash occurred. It was mostly those with mortgages of over 100% loan-to-value ratio who lost their properties.????

Anyone with a bit more savy than myself read this today?? Any thoughts on the points he made.
 
Hi Delboy,

Dan McLaughlin is chief economist with Bank of Ireland, an organisation that has a vested interest in house prices being maintained or even increasing from the present level.

So in my view his comments should be taken with this fact in mind (I was quite surprised this was not mentioned in the article).

I find David McWilliam's viewpoint on this (Prime Time last night) very convincing and would tend generally to listen more to commentators who do not have such a direct interest in the market.

Regards,


CyberPaddy
 
We have a difficult situation in this country (I don't know if it existed in the UK) where people who may like to trade down to a cheaper house, can't afford to do so, because of Stamp Duty.

I wonder if this is helping to keep the bubble inflated.

I wonder what the impact of this will be if interest rates increase, and people can't keep up mortgage repayments, and can't afford to trade down.

-Rd
 
I am just catching up on Friday's paper today. I was impressed by the article and I too was surprised that they didn't mention who Dan McLaughlin was. I have paraphrased the article here:

There was no property crash in the UK in the late 80's early 90's.

Average UK house prices.
1986 £ 36,290
1987 not given
1988 £49,355
1989 54848
1990 59785
1991 62455
1992 61366
1993 62333

So the only falling year was 1992. The decline in London in 1992 was 10%.

Interest rates: mid 1988: 7.5% rose to 15% by year end
Back to 7.5% by 1992

We think that there was a crash, because repossessions rose. But this was due to 100% mortgages and rising unemployment.

Share bubbles cannot be compared with house bubbles because:
Houses turnover once every 20 years, while shares turnover 3 or 4 times a year.
Houses cannot be sold short the way shares can
Panic selling doesn't happen much in the housing market
Most home owners don't cash in their homes just to take advantage of a boom.

House prices are more "sticky" downward in nominal terms.
 
CyberPaddy,

I'm well aware who Dan McLaughlin is and whom he works for, as I think most people are who have an interest in housing in Ireland. He contributes a lot to the various discussions/forecasts.

Brendan - I don't have the article in front of me but I too would be surprised if the Times had'nt mentioned whom he works for. They usually do at the end of an article which has been penned by a 'guest'.

I just thought he made some interesting points on the way things were in the uk. McLaughlin's predictions on the market have being the closest to the mark over the last few years, so while I know he has vested interests, he also seems to know his stuff.

But I agree with you on McWillaims, cyberpaddy. He makes a lot of sense and his empasis on the current transfer of wealth in this country from the younger to the older generations, is needed in the current climate
 
More pain..

I fear Benchmarking will fuel house prices over the next few years..
 
How do Irish house prices as a multiple of average earnings compare with other markets and with the historical norm?
I think that Irish house prices have entered unchartered waters and therefore relaying soothing statistics from the British market is of little relevance.
This does not mean there has to be a sharp fall in prices, just that historical data and trends are of little value right now.
The market is on stilts and vunerable to any kind of shock.
 
Huh?

No property crash in the UK in the 80's??

What cr@p!! I was there. I bought a house at the peak. I had my fingers burnt. FACT: THERE WAS A PROPERTY CRASH!!
 
Re: Huh?

tyoung,
i think most studies show house prices are related to
affordability and not to peoples' earnings. in other
words, people work out what mortgage they can
afford to pay and then are willing to spend that amount
on a house. so obviously in a country like ours or the
uk where most mortgages are variable rate (or are
only fixed for short periods), interest rates have a huge
effect on house prices. however tax rates, etc. also have
an effect.
 
Lies, damned lies...

Hi Guys,

This article (www.economist.com/display...d=1794913) appears to contradict the figures quoted in McLaughlin's article.

In particular:

"London House Prices soared by 120% in the five years to 1989, then fell by 30% over the following four years"

So the question is: who are we to believe?


Regards,


CyberPaddy
 
Re: Lies, damned lies...

Actually re-reading Brendans summary above, I'm not even sure what Dan McLaughlin was trying to say.

Was he saying "Relax, there's wasn't a crash in the UK, so everything will probably be ok here".

or

Was he saying "There wasn't a crash in the UK, but it felt like there was, so even if we don't have a crash here, it could still fell like we do".

As for whose figures to believe. This seems to be becoming a trend lately. We get shocking headlines about research done by The Economist or whoever, and a week later we get corrections, or contradictory figures that are much less shocking.

I don't know who to believe.

-Rd
 
Re: Lies, damned lies...

In accordance with reason and logic, it is easier for me to disbelieve Irish commentators than believe.

We are an island people the laughingstock of many our neighbous, but we still don't get it and are happy to excel in this our unique charade.
 
well, the Economist has made some big gaffs lately on their stats in relation to this country.

I'm not defending McLaughlin, by the way, and saying he is 100% correct. I just wanted to get the views of the board on his article.

Brendan - you wrote down his main points - what do you think of it all?????
 
I have to totally agree with smiler above. I was there (London) also. House prices at the time were about £200k - £300k. These houses fell by at least 50%. I know of many who threw the keys into the building society' letterbox. The figures from above that Brendan has shown from the article ( I haven't read it) are for the UK in general and therefor distort what happened down south.
 
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