# Is the bust already under way ?



## fatty (21 Oct 2003)

Am doing some buying and selling at the moment and I would venture that the bust has already started. This combined with the number of Auction withdrawals. 

Anyone else have similar experience ?


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## househunter1 (23 Oct 2003)

*Bust*

Looks like a seasonal slowdown to me. Interest rates would have the biggest impact on the market. Euro is at 1.18 dollars now. If the dollar slide continues eurozone interest rates are probably not going to rise in the next year


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## aphrodite (23 Oct 2003)

*Busted !!*

Yes believe the bust is well underway.

Would also guess that this will take months /  years  to unfold.

The symptoms and first indications are present. The prices are really high BUT no one  can find  a buyer.

Beware the  slippery slope and  all that...........


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## Agreed (23 Oct 2003)

*Bust*

Yes,  no is buying at the moment the bust has certainly started but it will take until after Christmas for the real affect to  be seen.  There will be lots of property on the market after Christmas.  October is one of the months that buyers are suppose to be out there buying - this is not so now.


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## ninsaga (23 Oct 2003)

*Re: Bust*

It would be nice to have some statistics to back this up though rather than peoples experiencies ie for same period last yr no of houses on the market that were turning vs now, avg  lenght of time houses on the market etc.

Also, what are teh most affected sectors ....

- Entry level housing
- 250k-350k bracket
- upgrades etc.

what are the big influences in the so called 'slow down or even bust'

Alot of people would be really interested to know this.

If there is a bust then I would think that the most vunerable would be those who are selling their own to buy another ie possibly paying the high offer price but unable to offload their own at the 'expected inflated' price.

ninsaga


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## stillbooming (23 Oct 2003)

*Still Booming*

I must disagree with the comments above. I am house hunting at the moment and keep getting out bid. I've also been to two auctions and both properties made double the guide price!!
My price range is 250k-400k.

The larger and more expensive properties don't seem to sell as fast but I think this is alot to do with the excessive stampduty.


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## EstorilB (23 Oct 2003)

*Re: Still Booming*

I spoke to an estate agent in Swords last week and he said the market there has slowed considerably due to oversupply and also the new motorway which has caused people to consider places a little further out like Skerries/Rush/Lusk.   

I think if the market is slowing it will hit areas like Swords/Lucan/Blanchardstown first just like it did the last time house prices went sideways/downwards in 2001.

EB


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## D7 (23 Oct 2003)

*Is the bust underway*

I am buying in the Dublin 7 area at the moment and I don't see any slowdown of prices in that area. Well maintained properties are still achieving well over the asking, while terreced houses are achieving at least the asking.

It looks to me that people are finally starting to see that paying high prices for properties in the Lucan, Swords and Blanchardstown areas etc, is leaving them open to a rougher landing as things slow down. They are far better off paying an extra 25k to buy a 250k house in a more established area than 225k for a 2 bed duplex or apartment in Lucan.

I've even seen people paying 200k for a 3 bed in Mullingar. Its a semi d with all the trimmings but in a slowdown i think the prices will drop considerably. 

I think that while there has been some justification for the price rises in and around the city center, there can be no justification for them so far out. Too many people have ran scared from the city prices and so builders have lashed up the prices in the country. Interesting times ahead.


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## DOBBER22 (23 Oct 2003)

*Re: Is the bust underway*

I can see a real slowdown in my area at the moment, most of the properties I've looked at have had in some cases 2-3 auctioneers trying to sell their property and most are still on the market with no bids in place or with bids below the asking price, I'm currently the highest bidder on two properties and whichever one I get a sale agreed on is the one I will take.


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## EstorilB (23 Oct 2003)

*Re: Is the bust underway*

D7,

It may be a cliche its true: Location, location, location.

Most of the people I know who have or are living in the new areas of Swords, Lucan etc view them as stepping stones to somewhere else (BTW I was one of those people once) and not as their long term residence.  If I was doing it all again I would have bought a 2 bed house in a top location instead of a 4 bed in a not so good location.

I think when prices soften the better areas will be much more resilient...

EB


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## sfag (24 Oct 2003)

*i'd say your right ...*

about the location thing. People will pay anything for the 'good' location'. My pals have just moved to Blackrock where 700,000 will buy you a mere 3 bed semi. They had no problem selling their old place either so I wonder about the bust. An estate where there is 1000 indentical homes will allways have a easily definable market value I guess, and therefore go down quicker.


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## EstorilB (24 Oct 2003)

*Re: i'd say your right ...*

700K for 3 bed semi? must be some house!   I would have thought around the 400-500 mark max for a blackrock 3 bed.

In any case people will always want to live in blackrock , they won't IMHO always want to live in Swords/Lucan etc...

EB


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## DOBBER22 (24 Oct 2003)

*Re: i'd say your right ...*

Think of how many houses/apartments you could buy in Bulgaria for 700k! :lol


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## The President (24 Oct 2003)

*Bulgaria*

yeah.... but the commute would be a killer!!!!!


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## how many (24 Oct 2003)

*bust*

How many house/flats would you get in London for 700k 2 or maybe 3


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## UK (29 Oct 2003)

*Burst*

You would get 3 houses and have some change for that amount of money???


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## daltonr (29 Oct 2003)

*Re: Burst*

>You would get 3 houses and have some change for that >amount of money??? 

3 houses for £483,000 Sterling?  You would need to be buying in some seriously bad parts of London.

I don't think it's fair to compare high end house prices in Dublin with Low end house prices in London.

There are places in Dublin where houses cost a lot less than €700,000 and in the UK there are MANY places where a house will cost much much more than £483,000.

-Rd


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## houseowner (29 Oct 2003)

*house prices*

I'm getting tired of listening to stories about the housing bubble bursting! For me, it seems like its the same people for the last 5 years telling me about it and once it does they'll buy up loads of houses for really cheap!

For the past 5 years I have owned my own house, bought for 120k and now worth 320k, and have enjoyed every day of living there - light years better than renting. And I think I'm safe enough as a 200k drop in house prices is unlikely. So maybe looking back, these same people should have been brave and bought then? Or maybe the following year or maybe they could be brave and buy now? 
You never know they could look back in 5 years from now and say Thank god I bought then or will they still be talking about the bubble bursting while living in rented accommodation? 

But, perhaps the prophets are all correct and the bubble will burst and then they can go around claiming that they knew it was going to happen and buy up all the cheap properties, but if they do drop then I too would love to buy up a few of these cheap houses - especially with interest rates so low. But with all these people just waiting to buy the cheap properties doesn't that mean they'll start to race back up in value again?

And finally, I don't really think that these people will ever buy a house, they will always find a reason not to.


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## Elcato (29 Oct 2003)

*Re: house prices*



> but if they do drop then I too would love to buy up a few of these cheap houses - especially with interest rates so low.


Methinks that higher interest rates will have prevailed by then thus actually causing any bust/slowdown.


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## houseowner (30 Oct 2003)

*Re: house prices*



> Methinks that higher interest rates will have prevailed by then thus actually causing any bust/slowdown.



But this isn't part of the prophets argument. Its just said that the prices will drop, no reason given other than "they can't keep rising".

Besides, it's my belief that house prices always have and always will be expensive in this country - relative to peoples incomes and interest rates. So I agree with what you're saying, because if they did drop, very few people would be buying the so called cheap houses as very few people will have the money to do so.


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## Tommy (30 Oct 2003)

*Re: house prices*



> Besides, it's my belief that house prices always have and always will be expensive in this country - relative to peoples incomes and interest rates.



This certainly wasn't true in the 80s when many people found that they couldnt sell property for love nor money, even to the extent that large parts of Dublin, Galway etc lay derelict and the well-off sectors of society piled their money into bank savings for fear of losing all in property.


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## houseowner (30 Oct 2003)

*Re: house prices*

Yes, but were the interest rates not in double digits making property expensive regardless of cost? 
High mortgage rates would have also meant excellent returns on savings,  compared to now at least, so saving was a better investment than buying houses?


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## Tommy (30 Oct 2003)

*Re: house prices*

Yes, but don't those facts counteract your previous point that house prices have always been expensive relative to interest rates and incomes? 

Someone I know bought a nice house in South Dublin for £30,000 in 1988. That person (a young professional) was earning £20,000 pa at the time. They paid 1.5 times their salary for their house - a bargain in anyone's book. (Nowadays you would need to be earning at least €300,000 pa to be able to afford to buy this house on similar terms.) 

ps Interest rates on savings were higher in those days than now - but remember also that even then the returns on deposits were not particularly attractive because of the effects of inflation. Any Irish people who invested sums on long-term deposit 10 or 15 years ago have actually experienced very poor returns once inflation is taken into account. 

You won't find too many people in Ireland who became rich from interest earned on savings. A lot of people have (even unwittingly) become rich in Ireland through owning property - the reason: they bought property cheap and sold when it became expensive.


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## tedd (2 Nov 2003)

*Re: house prices*

I think you have to decide whether you are buying a house or a home. If you are buying a home, then prices are almost irrelevant once you can pay the mortgage.


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