F
FFF
Guest
I see "The economist" is predicting a fall in house prices worldwide of 20% and a woman on radio one news is telling people not to buy but to rent. What do you all in AAM think of this - is the economist talking through it's a***
J
Jasper
Guest
I think they're predicting heavy property market falls in several countries, not just Ireland
R
Rubes
Guest
Would love to see where "The Economist" got its data from for that one. How can you compare property prices on a global basis when there are so many local factors to take into consideration??!!!!!? The mind boggles as to who gets away with writing this stuff!!!!
Even UK house prices cannot be taken as guide for Ireland/Dublin prices - there are many local factors which influence the price of property.
Even if house prices do drop by 20% that's only a problem if your intending to move house - otherwise it is irrelevant to you. Primarily a house has to be a home - not just seen as an investment.
Since no-one can predict the future all anyone can do is make a decision based on the information available to them at the time - that may be right or wrong. But hey, that's the way it goes.
Even UK house prices cannot be taken as guide for Ireland/Dublin prices - there are many local factors which influence the price of property.
Even if house prices do drop by 20% that's only a problem if your intending to move house - otherwise it is irrelevant to you. Primarily a house has to be a home - not just seen as an investment.
Since no-one can predict the future all anyone can do is make a decision based on the information available to them at the time - that may be right or wrong. But hey, that's the way it goes.
E
Elcato
Guest
Not to mention the fact that in 1990/91 the prices in England slashed by morethan half and nothing happened to the market here, in fact we got stronger. So I wouldn't worry about the 'economist' world statement.
L
LTB
Guest
I don't believe that houes prices are going to fall, and certainly not to the extent of 20%. We have been told several times to hold off on purchasing houses beacuse the "economics" predicts a fall in the price of this market - but has anybody seen a worthwhile drop yet?
I believe that the housing market is relatively stable at the moment, and even if prices did drop this year, I'm sure it would be a minimual drop and it wouldn't be long before the prices come back up again. I'm about to buy a house and certainly wouldn't postpone my plans going on that prediction. I say, if you want to buy a house, go for it now!
Just my opinion, don't know what the rest of you guys think!!
I believe that the housing market is relatively stable at the moment, and even if prices did drop this year, I'm sure it would be a minimual drop and it wouldn't be long before the prices come back up again. I'm about to buy a house and certainly wouldn't postpone my plans going on that prediction. I say, if you want to buy a house, go for it now!
Just my opinion, don't know what the rest of you guys think!!
D
Droxol
Guest
It will be.
OnBuisness
Survey predicts collapse in Irish property prices
May 29, 2003
(13:35)
A survey carried out by the Economist magazine is predicting a collapse in property prices in Ireland and worldwide. The magazine, which will be on shop shelves tomorrow, said that in many countries the stockmarket bubble has been replaced by a property-price bubble and sooner or later that bubble is going to burst.
The Economist studied data going back to 1975 from estate agents, lending institutions and government agencies and found that the price of homes in six big developed countries, including the US will drop dramatically in the near future.
It also said the consequences will be far more serious and painful than the current plunge in the stockmarket.
advertisement
The survey authors advise anyone who needs to move for work or family reasons to consider selling and then renting until prices drop. However they say most people will have to stick it out and watch their wealth dwindle.
==================
1. The stock market _is_ global !!
OnBuisness
Survey predicts collapse in Irish property prices
May 29, 2003
(13:35)
A survey carried out by the Economist magazine is predicting a collapse in property prices in Ireland and worldwide. The magazine, which will be on shop shelves tomorrow, said that in many countries the stockmarket bubble has been replaced by a property-price bubble and sooner or later that bubble is going to burst.
The Economist studied data going back to 1975 from estate agents, lending institutions and government agencies and found that the price of homes in six big developed countries, including the US will drop dramatically in the near future.
It also said the consequences will be far more serious and painful than the current plunge in the stockmarket.
advertisement
The survey authors advise anyone who needs to move for work or family reasons to consider selling and then renting until prices drop. However they say most people will have to stick it out and watch their wealth dwindle.
==================
1. The stock market _is_ global !!
F
FFF
Guest
House Prices
Would it be too cynical to suggest that this is being used to sell copies of the "The Economist" as house prices is something that affects a lot of people.
Would it be too cynical to suggest that this is being used to sell copies of the "The Economist" as house prices is something that affects a lot of people.
T
TheGreenMan
Guest
QUOTE: "all anyone can do is make a decision based on the information available to them at the time"
Well, I think that's what many people are doing i.e. making their decision based on the information available now. Quite a few saying there will be at least a correction.
I heard on the radio that apparently the number of first time buyers in the UK (on average) is down by 15% on this time last year; and down by 30% in London
Well, I think that's what many people are doing i.e. making their decision based on the information available now. Quite a few saying there will be at least a correction.
I heard on the radio that apparently the number of first time buyers in the UK (on average) is down by 15% on this time last year; and down by 30% in London
J
joe
Guest
house
"The survey authors advise anyone who needs to move for work or family reasons to consider selling and then renting until prices drop. However they say most people will have to stick it out and watch their wealth dwindle.
"
This post will be deleted if not edited immediately I am going to get Playboy instead anymore - at least you can look at the pictures !!
"The survey authors advise anyone who needs to move for work or family reasons to consider selling and then renting until prices drop. However they say most people will have to stick it out and watch their wealth dwindle.
"
This post will be deleted if not edited immediately I am going to get Playboy instead anymore - at least you can look at the pictures !!
R
Rubes
Guest
Re: house
Yep - in any decision all you can do is to make a decision based on the information available, some of which could well be conflicting e.g. estate agents still predict rising prices (albeit at a lower rate than before) while "The Economist" predicts drops of 20% - rather wide varyings there.
I fail to see the relevance of the UK property situation to our own - there are certain factors which make our situation unique to the UK e.g. lack of decent public transport in Dublin forcing people to buy close to the city to avoid a 15 million hour commute. It is generally unwise to take the trends from another country and extrapolate them out as the future for the Irish market
Yep - in any decision all you can do is to make a decision based on the information available, some of which could well be conflicting e.g. estate agents still predict rising prices (albeit at a lower rate than before) while "The Economist" predicts drops of 20% - rather wide varyings there.
I fail to see the relevance of the UK property situation to our own - there are certain factors which make our situation unique to the UK e.g. lack of decent public transport in Dublin forcing people to buy close to the city to avoid a 15 million hour commute. It is generally unwise to take the trends from another country and extrapolate them out as the future for the Irish market
D
daltonr
Guest
Re: house
Of course the difference between Estate agents and the economist is that the Estate Agents have vested interest in keeping everyone thinking that prices will go up forever.
Apart from the chance to make a headline the economist doesn't care whether prices go up or down, and I would be happier that their analysis is at least "reasonably" objective.
The Buyer can not trust an estate agent, EVER.
-Rd
Of course the difference between Estate agents and the economist is that the Estate Agents have vested interest in keeping everyone thinking that prices will go up forever.
Apart from the chance to make a headline the economist doesn't care whether prices go up or down, and I would be happier that their analysis is at least "reasonably" objective.
The Buyer can not trust an estate agent, EVER.
-Rd
R
Rubes
Guest
Re: house
Daltonr,
I agree entirely with your sentiments re estate agents - they have vested interests. However, even a cursory look at the prices of houses sold in Dublin (the only place I know about) over the past few months shows an upward trend.
The crux of this argument is that if you are buying a place to live for the foressable future then a drop in house prices is irrelevant to you. Basically, if you want/need to buy then go ahead, if your looking at it from an investment perpesctive then that may be a bit more dodgy.
I was always taught "nest, don't invest" - reasonably good advice for those just starting out on the property ladder.
Daltonr,
I agree entirely with your sentiments re estate agents - they have vested interests. However, even a cursory look at the prices of houses sold in Dublin (the only place I know about) over the past few months shows an upward trend.
The crux of this argument is that if you are buying a place to live for the foressable future then a drop in house prices is irrelevant to you. Basically, if you want/need to buy then go ahead, if your looking at it from an investment perpesctive then that may be a bit more dodgy.
I was always taught "nest, don't invest" - reasonably good advice for those just starting out on the property ladder.
M
Moneybags
Guest
Re: house
Hi Rubes,
I accept your point that the fundamentals of Irish property are different from the UK or anywhere else due to demographics, etc.
But isn't it true that a lot of the demand for property worldwide has been driven by the same two factors: low interest rates and a serious lack of investment alternatives.
I think that a wall of money searching for a home has certainly created a bubble in certain sections of the property market. What would Joe Kennedy say if he could hear the shoe shine boys tipping holiday villas in Croatia?
Hi Rubes,
I accept your point that the fundamentals of Irish property are different from the UK or anywhere else due to demographics, etc.
But isn't it true that a lot of the demand for property worldwide has been driven by the same two factors: low interest rates and a serious lack of investment alternatives.
I think that a wall of money searching for a home has certainly created a bubble in certain sections of the property market. What would Joe Kennedy say if he could hear the shoe shine boys tipping holiday villas in Croatia?
F
Fairfield
Guest
Economist predictions
As they say, if you predict something for long enough eventually you will be right - and eventually the Economist will be right. I remember reading an article in the Economist at least 3 years ago roughly along the same lines.
My own view is that this time they are right. House price increases up to now can be rationalised on the basis of
- shift to structurally lower interest rate environment
- strong demographic trend (baby boomers)
- sharp fall in unemployment
Of the above three factors, only one is still intact -demographics, and even this will weaken to some extent in the near future. Interest rates are low and going lower, but the magnitude of the drop from 8/9% to 2/3% over the last 10 years that we have seen is finished. And unemployment is begining to rise and set to continue especially if we don't adjust to the new economic reality of post- Celtic tiger and start to reduce prices (there is avery good article by Jim O'Leary on this topic in the IT today).
So my guess is that there is 20% froth that could come off the residential market very easily. If you are owner occupier, who cares. If you are thinking of buying to occupy, don't delay as the timing of this is anyone's guess. But for investors, the easy money has been made and it may be time to take some chips off the table.
As far as commercial is concerned we are already seeing the office segment under price pressure with rents easing back.
Watch this space.
As they say, if you predict something for long enough eventually you will be right - and eventually the Economist will be right. I remember reading an article in the Economist at least 3 years ago roughly along the same lines.
My own view is that this time they are right. House price increases up to now can be rationalised on the basis of
- shift to structurally lower interest rate environment
- strong demographic trend (baby boomers)
- sharp fall in unemployment
Of the above three factors, only one is still intact -demographics, and even this will weaken to some extent in the near future. Interest rates are low and going lower, but the magnitude of the drop from 8/9% to 2/3% over the last 10 years that we have seen is finished. And unemployment is begining to rise and set to continue especially if we don't adjust to the new economic reality of post- Celtic tiger and start to reduce prices (there is avery good article by Jim O'Leary on this topic in the IT today).
So my guess is that there is 20% froth that could come off the residential market very easily. If you are owner occupier, who cares. If you are thinking of buying to occupy, don't delay as the timing of this is anyone's guess. But for investors, the easy money has been made and it may be time to take some chips off the table.
As far as commercial is concerned we are already seeing the office segment under price pressure with rents easing back.
Watch this space.
L
Ludraman
Guest
Re: Economist predictions
Hi Fairfied,
You've left me confused. You have just said;
"If you are thinking of buying to occupy, don't delay as the timing of this is anyone's guess"
.........so what should I do, as it's "anyones guess"?
Hi Fairfied,
You've left me confused. You have just said;
"If you are thinking of buying to occupy, don't delay as the timing of this is anyone's guess"
.........so what should I do, as it's "anyones guess"?
J
justwondering
Guest
house prices
With a requirement for c55k house starts a year over at least the next 5 years ...what could be the triggers ? on the balance of probabilities we can expect stagnation not the 20% reduction as predicted.
With a requirement for c55k house starts a year over at least the next 5 years ...what could be the triggers ? on the balance of probabilities we can expect stagnation not the 20% reduction as predicted.
M
martin
Guest
re: house prices
You can read tomorrow that house prices have increased in April by 1.3% with the greatest increase being outside of Dublin.
Interest rate reduction of probably .5% next week and another expected by year end aware not all being passed on). So, Fairfield interest rates have not stopped going down.
The only thing to trigger a fall in house prices in the short term will be unemployment stats.
You can read tomorrow that house prices have increased in April by 1.3% with the greatest increase being outside of Dublin.
Interest rate reduction of probably .5% next week and another expected by year end aware not all being passed on). So, Fairfield interest rates have not stopped going down.
The only thing to trigger a fall in house prices in the short term will be unemployment stats.
F
Fairfield
Guest
House Prices
Ludraman
What I mean is if you are buying as an owner occupier, don't delay in the hope that the market will come back 20%, because while I believe that it will, it may not happen for a while. And as it is a long term purchase (presumably if you are buying to live there) 20% is neither here nor there on the basis that things will improve longer term.
Martin - yes I know interest rates are going lower. What I meant was that the magnitude of the fall in interest rates which was a big driver of the house price surge, is now behind us and no longer a factor. i.e. interest rates may fall from 2.5% to 2 or 1.5%, but this is not going to have the same affect going forward as a fall from 8/9% down to 2/3%.
And as for demand for c. 55k houses, this is more than being met by c. 60k housing starts. Supply has well caught up on demand.
Ludraman
What I mean is if you are buying as an owner occupier, don't delay in the hope that the market will come back 20%, because while I believe that it will, it may not happen for a while. And as it is a long term purchase (presumably if you are buying to live there) 20% is neither here nor there on the basis that things will improve longer term.
Martin - yes I know interest rates are going lower. What I meant was that the magnitude of the fall in interest rates which was a big driver of the house price surge, is now behind us and no longer a factor. i.e. interest rates may fall from 2.5% to 2 or 1.5%, but this is not going to have the same affect going forward as a fall from 8/9% down to 2/3%.
And as for demand for c. 55k houses, this is more than being met by c. 60k housing starts. Supply has well caught up on demand.
B
Bearish
Guest
Re: House Prices
Dont under estimate the effect setiment can have on any market in the shortrun!
Dont under estimate the effect setiment can have on any market in the shortrun!