Any ideas out there on what the government can do if anything to stimulate the property market by doing something for first time buyers ?
Any ideas out there on what the government can do if anything to stimulate the property market by doing something for first time buyers ?
Well the govt have to look at their coffers and weigh up whether its better to stimulate the market or let things find their own way. People get very built up about the perceived notion that a stimulus to the market is just to 'bail out their property developer buddies' which is a very narrow minded attitude and a bit of mob mentality takes over.
The govt will see obviously that their income is way down this year and one way to increase this income would be to get the market going in some way. For instance when new houses are not selling they are getting no vat payment from builders but in the meantime the builders will have actually claimed back vat on the supplies etc used in the buildeing of the property so in effect the govt is down further because the houses are not selling. They could provide an incentive to get new houses moving such as grant or tax back. The other aspect that seems to be getting some backing is the ah scheme but I don't think this would be of any use or get any backing.
Bang on.The average industrial wage is €38k, the average house price should be no more than 5 times this, €190k, currently it is about €250k so there should still be 24% to go.
MrMan, would you care to expand on this? In what sense is the doing the right thing for the economy "narrow minded"? And do you really believe that the developers do not own a massive chunk of Fianna Fail?People get very built up about the perceived notion that a stimulus to the market is just to 'bail out their property developer buddies' which is a very narrow minded attitude
Bang on.
Forget the patronising 'perceived notion that a stimulus.... is just to 'bail out their property developer buddies' which is a very narrow minded attitude and a bit of mob mentality'.
Despite people having good reason to consider this to be the case.. affordability is what its all about. Property is over priced and values need to correct. When they come into peoples financial reach, then that'll be stimulus enough.
MrMan, would you care to expand on this? In what sense is the doing the right thing for the economy "narrow minded"? And do you really believe that the developers do not own a massive chunk of Fianna Fail?
Further, do you not agree that there are plenty of vested interests in Ireland who have been talking up the market and telling us prices would rise (fooling a lot of people into disastrous buying decisions) but no lobby group agruing for the good of the country?
As other posters have commented, this crash is exactly what the country needs. The pity is that it did not happen a couple of years ago when it would have been much less severe, and fewer people would have been hurt.
Any ideas out there on what the government can do if anything to stimulate the property market by doing something for first time buyers ?
Regards VI's of course people talk things up if it means that the outcome will suit them just as I'm sure that you will agree people will talk things down to suit their own needs too. Look at jetro on another thread doing what he can to make sure that prices fall because he has yet to 'step on the ladder' and I think he would be mad not to take this line as it is obviously in his interests. We all take care of ourselves to some degree I just object to those who take the moral high ground and can't see the they are as much a VI as the next guy.
Did i hit a nerve? how was it patronising? My point was not that the bailout would be a good or a bad thing just that it may be something the current govt see as a way of providing much needed funds now.
All those first time buyers salivating about dropping prices should also realise that they won't be getting much of a mortgage if they have no job, which becomes increasingly likely as you have a stalemate which is reducing both employment and tax take like you have now.
Providing taxpayer finance to FTBs up to 300K is artificially propping up prices on my book. While banks are not throwing money around it is still possible to get finance where a buyer has a reasonable deposit saved up. Now, the government are providing finance to buyers that the major financial institutions deem it too risky, - this is akin to subprime lending (while these people certainly may not have bad credit historys, they are too risky to give such large sums to in a falling market.Having an economy where people are able to get financing for houses, and having confidence to buy those houses if they choose to do so, would be a good first step. Artificially inflating prices should not play any part in this.
I wish this were the case, - unfortunately there are plenty of people who will take as much money as is thrown at them. Most government intervention at this stage is futile, it will hardly cushion the blow at all, it only amounts to money wasted.Buyers have learnt a valuable lesson in the past two years and are in a much better position to make informed decisions now, than they were in the past.
Government maneuvers will not stop the inevitable correction of the market, but they will waste a lot of my hard earned money.Prices will be determined by yield at the end of the day, and government maneuvers should not impede this.
While it's very easy to be populist and say that any bailout will only suit "FF's developer friends", the reality of the situation is that the current stalemate is not good for the irish economy.