best way of getting exposure to irish property market

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joe sod

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Just wondering whats best way of getting exposure to irish property market without actually buying a property. I suppose the obvious choice would be reits or bank shares. I currently have a small holding in one reit was thinking of buying some bank shares, i know we not supposed to talk individual shares
 
Sorry, I'm struggling to see the correlation between property and bank shares? You'd be getting exposure alright, but only to the downside. How would a rise in property values result in a higher share price for banks?
 
To answer your original question apart from Reits, there are also property funds. I'm not sure if they make any sense outside a pension though - I've never tried to work out the tax implications of holding directly. I have part of my pension invested in a Dublin commercial property fund. Management fees can be a little high, and due to small fund sizes some of them are very concentrated on just a few properties.
 
Hello,

Are there ETFs for Irish property, or are we solely relying on REITs ?

If there are both, it might be worth weighing up the pros and cons.
 
You are right it hasn't really followed irish residential property, however it has performed well this year. Maybe it will start to follow it in the future. But maybe banks might be the way to go now. It took the big tech companies like Microsoft and Intel over a decade after the dot com bust to start really performing again. We are almost a decade after the financial crash maybe the banks will become good investments again.
 
RedOnion said:
Sorry, I'm struggling to see the correlation between property and bank shares? You'd be getting exposure alright, but only to the downside. How would a rise in property values result in a higher share price for banks?
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id have thought there was a considerable chance of bank shares rising in conjunction with property prices ( i may be wrong on that one however )
 
Brendan Burgess said:
I discussed it here three years ago

https://www.askaboutmoney.com/threa...your-deposit-money-a-residential-reit.186486/

I haven't watched their performance, but I have been told that the iRES has not done as well as Irish residential property prices.

Brendan
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the REIT,s for the most part have not kept pace with house - property price movements

REIT,s are in their infancy in this country , perhaps it takes time for the cream to rise to the top , my concern about REIT,s is because the sector is so young , governance or even rigour on the part of investors may not be as high

potential for waste in management could be significant
 
galway_blow_in said:
id have thought there was a considerable chance of bank shares rising in conjunction with property prices ( i may be wrong on that one however )
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Not over the last 3 years anyhow...
There is a good possibility of bank shares rising as the economy grows in general (bigger market, fewer bad debts), but I can't see a direct link back to mirroring the property market. If a bank has lent X billion to mortgage holders / property investors at X % margin, it doesn't make a difference to the banks profit if the underlying property doubles in value - they don't share in that rise.
The vulture funds on the other hand should see a bigger correlation as their recovery on non performing loans will be tied to the underlying property values.
 
joe sod said:
Just wondering whats best way of getting exposure to irish property market without actually buying a property.
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No there isn't.

And a good thing too. I have borrowed money to invest in property, I manage the property and the tenants. I have to endure changing and ever more onerous legislation. And you want to know how you can enjoy the same returns "without actually buying" a property.

There is a reason why property investment pays so well if done sensibly. Because its bloody hard work.
 
RedOnion said:
Not over the last 3 years anyhow...
There is a good possibility of bank shares rising as the economy grows in general (bigger market, fewer bad debts), but I can't see a direct link back to mirroring the property market. If a bank has lent X billion to mortgage holders / property investors at X % margin, it doesn't make a difference to the banks profit if the underlying property doubles in value - they don't share in that rise.
The vulture funds on the other hand should see a bigger correlation as their recovery on non performing loans will be tied to the underlying property values.
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i am aware how bank of ireland has done since 2014 but its been heavily shorted , its far cheaper than AIB for example

surely a stronger property market reflects well on the banks loan book ?
 
galway_blow_in said:
i am aware how bank of ireland has done since 2014 but its been heavily shorted , its far cheaper than AIB for example

surely a stronger property market reflects well on the banks loan book ?
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I think there has been alot of negativity with regard to all european banks, they are still not regarded as a respectable investment. I think the comparison with the original big tech companies is valid , they recovered some lost ground after the dot com bust but then remained in the doldrums for years before starting to perform strongly again a few years ago when the dot com collapse was forgotten about.
 
joe sod said:
I think there has been alot of negativity with regard to all european banks, they are still not regarded as a respectable investment. I think the comparison with the original big tech companies is valid , they recovered some lost ground after the dot com bust but then remained in the doldrums for years before starting to perform strongly again a few years ago when the dot com collapse was forgotten about.
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european financials have gone up a lot since brexit , bank of ireland hasnt moved at all despite above average fundamentals , its trojectary is at odds with the overall sector , its being heavily shorted
 
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