Material Prices Boom Bust Boom

A

aprentice

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If anyone is planning any substantial DIY or building work in the new year .
Most materials prices are increasing by 3-15% from the 1st of January .
This is the 3rd of these type letters through the door this week .
This will have an effect on where house prices need to be before building firms will start building again .
The central bank just has to let go and stop strangling the market .IMO.
Boom Bust Boom the cycle has to be aloud to happen .

Anyway I'm glad I'm out of the business.
 
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I haven't been on forums in a few years can any 1 tell me how to post a pic .
way back when you just got a link from photo bucket .
 
Unless the cost of materials is three times greater in south county Dublin than in Limerick (which it isn't), the increasing price of houses has little or nothing to do with the cost of building materials. The Central Bank is right to try to maintain a bit of sanity in the market.
 
Your right to some extent but coupled with the average trademans wage
Dublin €800-1000
Limerick €600-800
And average price per acre
I would argue it will make a difference
 
If the average wages are 25-33% higher and the cost of land is up to a factor of 20 higher in Dublin, a several percent rise in the price of materials becomes practically irrelevant. How much has materials price increases contributed to the 50% rise in Dublin property prices since 2012? -- practically nothing I would suggest.

Not only that, but the higher wages and land costs in Dublin are because of the high property prices -- it's a vicious circle. Basically people are prepared to sacrifice a dangerously high proportion of income to go where the jobs are, fuelling a bubble. In a situation of undersupply prices will rise to soak up any amount of available credit. It would be sheer insanity to loosen lending limits when prices are rising at 20 times the rate of inflation. The mind boggles as to how people (mostly vested interests) can be calling for this.

There are other structural issues that need to be addressed as a matter of urgency to fix the supply problem. Unfortunately our government's clever masterplan which is still focused on addressing the disastrous fallout of the last bubble is aimed at jacking prices up ever higher, so that the next crash is getting baked in as we speak. Except next time we'll be starting from a 100% debt to GDP ratio and with billions in arrears and bad loans from last time round. Why do keep wishing this on ourselves?
 
The alternative seems to be landlords and homelessness

The fact is until its profitable to build a house in all areas they won't build them
Currently costs around 2-300k to build a house in Dublin
Currently costs 2-300k to buy an average house in Dublin
We can now add 7-10k to them figures from January 1st
 
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