Why (the state) bailing out housing market is a bad idea..mcwilliams indo article

[becky]

Re: Why bailing out housing market is a very bad idea

Have to say I do find charliemacck comments strange no matter how strongly he feels.

I didn't buy a house during the boom despite many people telling me to. I now might be in a position to buy next year at a price I see as reasonable. This was my choice. I don't see why I need to support people who bought at the peak...that was their choice.

 

[GalwayGuy]

Re: Why bailing out housing market is a very bad idea

I my eyes McWilliams is bang on the Money with this article. The 'Morket' should be allowed correct naturally. If that means absolute implosion then all the better! The cheaper housing becomes the better for the country in the long run.

Housing just plainly got TOO expensive in this country. Bog standard 40 year old semi-ds supposedly worth 400+k in Galway. No wonder the country is uncompetitive.

Whomever bails out the housing market loses two votes in this house come next election!

 

[Jethro Tull]

Re: Why bailing out housing market is a very bad idea

Poople have to live somewhere. That is a fact. Also this comparison with the worst property bubble i.e japan may or may not be valid. I am not sure that all the factors in the japenees housing market can be applied to the Irish market. Again I may be wrong.

at one stage average house prices in ireland were almost 10x average industrial wages. From what i can tell the international norm is somewhere between 3 and 4x. I read an article not so long ago from an english journalist horrified that average house prices ahd broken the 5x barrier. If this doesn't constitute irrational house prices then i don't know what does.

 

[Jethro Tull]

Re: Why bailing out housing market is a very bad idea

Have to say I do find charliemacck comments strange no matter how strongly he feels.

I think he's a troll. look at some of his other posts. He just seems to take the mickey in all threads he becomes involved in

 

[MrMan]

Re: Why bailing out housing market is a very bad idea

Housing should go through its own natural cycle and we should all now just ignore mcwilliams and his polar opposites and make up our own minds for once. nobody here can properly predict the rise or fall and saying things like the return of prices to 2006 levels will only happen in 2016 makes no sense and has no actual facts to back it up, reason being are facts are hard to find when crystal ball gazing.

 

[ubiquitous]

Re: Why bailing out housing market is a very bad idea

I think he's a troll. look at some of his other posts. He just seems to take the mickey in all threads he becomes involved in

Troll or irony specialist. I've yet to decide myself.

 

[Thomas22]

Re: Why bailing out housing market is a very bad idea

Housing should go through its own natural cycle and we should all now just ignore mcwilliams and his polar opposites and make up our own minds for once. nobody here can properly predict the rise or fall and saying things like the return of prices to 2006 levels will only happen in 2016 makes no sense and has no actual facts to back it up, reason being are facts are hard to find when crystal ball gazing.

Thats my opinion and it is based on the facts as I see them.

Zero nominal increases from 2006 to 2016 would allow prices to return to what would be considered normal. I think a salary to house multiple of 4-5 is normal. In Ireland it is closer to 10 at the moment

 

[charliemacck]

Re: Why bailing out housing market is a very bad idea

You are joking aren't you? If you're not joking then I would suggest anyone reading this should ignore you as you are a long way off having any understanding of economics. You are so off beam it is actually funny.

I'm not sure why you think I'm being funny. You mentioned several well-known experts who didn't warn ordinary people about difficult times ahead. People have mentioned McWilliams, but he's been warning people now for 15 years and doesn't count, like the ginger boy who cried wolf. What I am referring to are those experts who had a reasonable view of the property market - why did those fellas not warn the ordinary people? That's all I'm saying. And if these experts didn't warn people then people have a right to some comeback. If medical experts did not warn people of a virus and then the people caught it, would you not think that the people deserve some compensation? I'm not sure why my opinions are being mocked, I'm sure my opinions are fairly mainstream I'm sure. If I set up a political party will my proposals I'm fairly certain we'd get a few votes. I'm willing to admit that I am open to changing my mind and perhaps people should not have been talking up the property markets so much and there should have been more open debate especially in the likes of this forum.

 

[television]

Re: Why bailing out housing market is a very bad idea

Quote:Television


Poople have to live somewhere. That is a fact.




Yes, so they could rent for half the price of owning........

Increase in renters increases rents, brings investors into the market increasing the demand for houses etc etc

 

[Thomas22]

Re: Why bailing out housing market is a very bad idea

I'm not sure why you think I'm being funny. You mentioned several well-known experts who didn't warn ordinary people about difficult times ahead. People have mentioned McWilliams, but he's been warning people now for 15 years and doesn't count, like the ginger boy who cried wolf. What I am referring to are those experts who had a reasonable view of the property market - why did those fellas not warn the ordinary people? That's all I'm saying. And if these experts didn't warn people then people have a right to some comeback. If medical experts did not warn people of a virus and then the people caught it, would you not think that the people deserve some compensation? I'm not sure why my opinions are being mocked, I'm sure my opinions are fairly mainstream I'm sure. If I set up a political party will my proposals I'm fairly certain we'd get a few votes. I'm willing to admit that I am open to changing my mind and perhaps people should not have been talking up the property markets so much and there should have been more open debate especially in the likes of this forum.

But McWilliams has only be warning people for the last 8-9 years and he has been right all along. The fact that it has taken this long for him to be proven right is irrelevant IMO.

The fact that people choose to ignore him over this period just goes to show how hard it is to get the message across through all the media hype.

There has been very little open and honest discussion on the negative effects of excessive house price inflation in Ireland, so yes alot of people will have bought when they shouldn't have.

But who should they have comeback to?
The government?
The banks?
The economists?
The Estate Agents?
Maybe even sites like this one?

IMO they only have themselves to blame

 

[television]

Re: Why bailing out housing market is a very bad idea

at one stage average house prices in ireland were almost 10x average industrial wages. From what i can tell the international norm is somewhere between 3 and 4x. I read an article not so long ago from an english journalist horrified that average house prices ahd broken the 5x barrier. If this doesn't constitute irrational house prices then i don't know what does.

Yes but look at aforability levels, that is a key also, remember in the dark old days when interest rates were 17% and houses were going for 20-30 grand people still struggled with afordability. That is a key measure.

 

[aircobra19]

Re: Why bailing out housing market is a very bad idea

Once the work dries up, the population won't increase anything likes been suggested here. Thats a fantasy. Ditto the easy credit. Which started this madness.

 

[Thomas22]

Re: Why bailing out housing market is a very bad idea

Increase in renters increases rents, brings investors into the market increasing the demand for houses etc etc

There has been very little increase in rent in the last few months


From http://www.irishpropertywatch.com/
From the 30th of July to the 13th of August 2008 there were 1,313 rent reductions. The average reduction was €105 per month.
There were 263 rent increases over the same period, the average increase was €128.
The number of properties for rent in Ireland dropped to 15,823 from 15,941 the previous week

Please click here for the full report.
Time on the Market

• 4 Months+ 1,922 Properties, Average Rent = €1,295
• 3-4 Months 840 Properties, Average Rent = €1,322
• 2-3 Months 1,325 Properties, Average Rent= €1,218
• 1-2 months 2,873 Properties, Average Rent=€1,256
• 0-1 Months 8,863 Properties, Average Rent= €1,182

We built far too many houses for in this country over the last few years.

 

[groom]

Re: Why bailing out housing market is a very bad idea

Increase in renters increases rents...

...cancelled out by much greater supply which is forcing down rents in reality

brings investors into the market increasing the demand for houses etc etc

...where would these investors get mortgages if they were still to persue a purchase even though returns are pathetic at 2-3% and suffering capital depreciation

 

[television]

Re: Why bailing out housing market is a very bad idea

I'm not sure why you think I'm being funny. You mentioned several well-known experts who didn't warn ordinary people about difficult times ahead. People have mentioned McWilliams, but he's been warning people now for 15 years and doesn't count, like the ginger boy who cried wolf. What I am referring to are those experts who had a reasonable view of the property market - why did those fellas not warn the ordinary people? That's all I'm saying. And if these experts didn't warn people then people have a right to some comeback. If medical experts did not warn people of a virus and then the people caught it, would you not think that the people deserve some compensation? I'm not sure why my opinions are being mocked, I'm sure my opinions are fairly mainstream I'm sure. If I set up a political party will my proposals I'm fairly certain we'd get a few votes. I'm willing to admit that I am open to changing my mind and perhaps people should not have been talking up the property markets so much and there should have been more open debate especially in the likes of this forum.

I respect your strong feelings, but the decision to buy property is a personal one. Any person making an investment should be aware of the risks or make sure they inform themselves before buying, regardless of what vested interested so called experts were saying. So while having sympathy for those who bought recently, they are responcible for thier actions no one else.

 

[Thomas22]

Re: Why bailing out housing market is a very bad idea

Yes but look at aforability levels, that is a key also, remember in the dark old days when interest rates were 17% and houses were going for 20-30 grand people still struggled with afordability. That is a key measure.

They struggled with it, BUT

1) They still only needed 1 wage.
2) Higher inflation made repayments manageable after a few years.
3) They only needed a 20 year mortgage
4) Very few people had to take a "step onto the property ladder" they usually bought the house they intended to buy 1 maybe 2 homes in their lifetime

 

[aircobra19]

Re: Why bailing out housing market is a very bad idea

....If technology workers demonstrated some entrepeneural spirit that some of the building workers did, rather than happily being contractors or doing menial work for some multinational, we might have had some more breakthroughs. The "backpack" culture has done more to damage our standing than any building boom.

At present, irish tecnology graduates have too narrow a skill set to do anything of impact on the international stage, or the know how /willingness to implement it.(there may be a few exceptions out there, I know)

And lets be fair, none of you guys could name a second finish company without google, so ryanair cancels that one....

If technology inovation was that easy everyone would do it.

That so many piled into construction/property just illustrates how much easier that is, and also how much easy money was available to these people. People are far more wary at getting involved with a technology start up.

 

[television]

Re: Why bailing out housing market is a very bad idea

...cancelled out by much greater supply which is forcing down rents in reality


...where would these investors get mortgages if they were still to persue a purchase even though returns are pathetic at 2-3% and suffering capital depreciation

So are you telling me that the existing stock of houses are enough to solve the increased demands for rental property brough about by a housing crash?

 

[Thomas22]

Re: Why bailing out housing market is a very bad idea

So are you telling me that the existing stock of houses are enough to solve the increased demands for rental property brough about by a housing crash?

Over the last 3 years of the boom we built around 250k properties. Enough to house nearly 750k people. I'm sure we have enough to keep us going for a while

 

[aircobra19]

Re: Why bailing out housing market is a very bad idea

What increase in demand for rental property?