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What was it the captain of the Titanic said just before they hit the berg?.......Oh yeah I remember now, "We're forging ahead".
He would say that - if it doesn't "forge ahead", he's out of a job next May!
The Irish property market has always been talked up by vested interests through the media.
...look at the amount of "reports" these guys have put out over the past few years: [broken link removed]
It's usually reported verbatim in the media.
It's the same with IIB. So nothing has changed lately on that front making their impact fairly neutral.
What has changed is that interest rates have risen four times in nine months and are set to rise another two times before Christmas - next one on 5th October.
No amount of spin and reassurance from banks, new homes estate agents, politicians etc can prevent the inevitable.
bearishbull
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The indo did report falls in asking prices in glasnevin in june or july, theres a link on here somewhere. Seems to be more widespread now though, I reckon we'll have all those stories in next month or two if the market doesnt enter another last gasp spurt of growth.
I can see the IT giving a prominent display to stories such as the one report today from IIB seeing they have such a vested interest in propping up the bubble. Also Cowens comments on the news will have them smiling at IIB/IT etc.....
I had expected last splurge possibly on the back of an ECB rate pause. Only the media wouldn't call it a pause (which would imply a resumption of raises) they would call it the "top of the cycle". Following which we would see cuts. Buyers who could get mortgages would come out of the woodwork to buy at inflated prices on the expectation that any yahoo would be able to get a mortgage in a year's time, driving prices even higher again.
The crash would then come when in a shock instead of pausing the ECB started to raise again.
However, the market is weakening quicker than I expected and so there may not be a last splurge. I'm in two minds but I guess things will start to become clearer in Jan/Feb of next year.
Does anyone here think that a soft landing is possible for the Irish property market?
Although I think it's unlikely to happen, could a soft landing be better for the economy and jobs etc.?
Is it better to have a good clearing of the Irish obsession with property through a crash or temper it with a gentle downturn?
Although I think it's unlikely to happen, could a soft landing be better for the economy and jobs etc.?
Is it better to have a good clearing of the Irish obsession with property through a crash or temper it with a gentle downturn?
I don't see how there can be a soft landing given that so many investors will offload once there is no further cap appreciation in the pipeline. I think we are already beginning to see the effects of this albeit at a minor pace.
I agree that we need a good clearout of our obsession with property so that we can become more focused on making real gains in development/ research etc which could lead to sustained growth further down the line (well hopefully)
A landing is a landing is a landing........soft or hard is irrelevant! People seem to think if it's 'soft' then everything is OK. Unfortortunately not. The money that has been pumped into property - whether by folks who simply wanted 'their own home' or those who speculated on making profit - has been either locked into property as it was valued at a particular moment in time, or gone into the dividend paid to the bank's shareholders or gone to one of the thousand or so Irish property millionaires.
As far as I can gather from other threads on AAM the boom hasn't resulted in either the government investing its huge haul of revenue from property taxes into public services and infrastructure nor do those private individuals who profited from the housing boom appear to have invested their haul in Ireland. The impression is its gone abroad - into foreign property.
Doesn't this mean that whether 'soft' or 'hard' ending to the property boom that's dead money? Isn't that what posters here refer to when they say 'the party's over' - it's been a time of plenty, new cars, holidays, the good life.............then there's the 'morning after'.
Difficult to picture what life will be like in 5 - 7 years time but that money is gone, gone gone! Further roaring beasts of any ilk are not anticipated. I hope people who have bought in the past 5 years can be philosophical about it and enjoy their homes and continue to get employment through which to pay their large, long mortgages.
As far as I can gather from other threads on AAM the boom hasn't resulted in either the government investing its huge haul of revenue from property taxes into public services and infrastructure nor do those private individuals who profited from the housing boom appear to have invested their haul in Ireland. The impression is its gone abroad - into foreign property.
Doesn't this mean that whether 'soft' or 'hard' ending to the property boom that's dead money? Isn't that what posters here refer to when they say 'the party's over' - it's been a time of plenty, new cars, holidays, the good life.............then there's the 'morning after'.
Difficult to picture what life will be like in 5 - 7 years time but that money is gone, gone gone! Further roaring beasts of any ilk are not anticipated. I hope people who have bought in the past 5 years can be philosophical about it and enjoy their homes and continue to get employment through which to pay their large, long mortgages.
bearishbull
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Anyone hear the two vested interests spinning on the last word today "price only ever go up" "more price rises are inevitable" "demand is real and not from speculation" etc etc, they are trying to persuade the government not to intervene in market to stop speculation etc. think they are getting worried.
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LivinAbroad
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Public sentiment towards the housing market.... I know this thread is about Irish sentiment, but I thought some of you might be interested in the US.
I live in Key Biscayne, a wealthy part of Miami, FL. (I rent the smallest apartment on the island!). I thought about buying in 2005 - a local (Irish realtor (Estate Agent) was of the opinion that Key Biscayne was nuclear proof and that prices could only go up or stabilise briefly. But the Fed raised interest rates, the property developers in Miami and SOuth FLorida continued to build and now..... across the board, we're looking at prices that are 10% less than they were last year - best rent money I ever paid!
Miami is a hotspot in property in the US - and prices are falling, even as rents rise (more people are less willing to buy - so they rent, pushing up rental prices, but property prices are falling). Housing inventory is at it's highest in 13 years, and there are still 85,000 units to be completed before June 2007! Developers have started walking away from land options, cancelling large condo projects. The main talk about property now is how big is the bubble and when it will burst.
It is bound to come to Ireland too.I left Dublin / Ireland in 2001 becasue I was priced out of it - I basically felt that it was either a lifetime of scrimping and saving to live in a house I felt was acceptable or 15- 20 years of scrimping and saving to live in a dump. Of course, if I'd realised that the mania would continue, I could have bought and sold and made a tidy sum. Oh well. I've been a bear for years, reading the papers and these threads, my opinion is only strengthened.
The question I would ask is WHY live in Ireland now? Why be an FTB? If you're 22 and fresh out of college or considering becoming an FTB, then leave it, gain some foreign work experience, (it will always stand to you in your career) wait for the bubble that virtually everyone expects, and then come back to lower property prices?
Vested interest? I own no property anywhere in the world, would like to return to Ireland at some stage, but only when prices become more realistic. Roll on the crash.
I live in Key Biscayne, a wealthy part of Miami, FL. (I rent the smallest apartment on the island!). I thought about buying in 2005 - a local (Irish realtor (Estate Agent) was of the opinion that Key Biscayne was nuclear proof and that prices could only go up or stabilise briefly. But the Fed raised interest rates, the property developers in Miami and SOuth FLorida continued to build and now..... across the board, we're looking at prices that are 10% less than they were last year - best rent money I ever paid!
Miami is a hotspot in property in the US - and prices are falling, even as rents rise (more people are less willing to buy - so they rent, pushing up rental prices, but property prices are falling). Housing inventory is at it's highest in 13 years, and there are still 85,000 units to be completed before June 2007! Developers have started walking away from land options, cancelling large condo projects. The main talk about property now is how big is the bubble and when it will burst.
It is bound to come to Ireland too.I left Dublin / Ireland in 2001 becasue I was priced out of it - I basically felt that it was either a lifetime of scrimping and saving to live in a house I felt was acceptable or 15- 20 years of scrimping and saving to live in a dump. Of course, if I'd realised that the mania would continue, I could have bought and sold and made a tidy sum. Oh well. I've been a bear for years, reading the papers and these threads, my opinion is only strengthened.
The question I would ask is WHY live in Ireland now? Why be an FTB? If you're 22 and fresh out of college or considering becoming an FTB, then leave it, gain some foreign work experience, (it will always stand to you in your career) wait for the bubble that virtually everyone expects, and then come back to lower property prices?
Vested interest? I own no property anywhere in the world, would like to return to Ireland at some stage, but only when prices become more realistic. Roll on the crash.
Today FM shouldn't bring on vested interests unchallenged, because it simply amounts to free advertising time for them. The IPAV (auctioneer) guy seemed to rule out any landing at all, hard or soft. He said there'll be a "continued upturn" and even managed to get in the suggestion that you should mortgage your home to buy an investment property if your children are off to college - it'll save you on rent.
An economy that is borrowing 15 times more for real estate than manufacturing is going to suffer cold turkey. The irish economy needs to borrow 50,000 million just to maintain current activity levels. No wonder FTBs / novice landlords are being spinned stories from banks and IPAV. In the next 12 months it is possible that the private sector, excluding banks, will borrow 100,000 million or equivalent to giving everyone at work 50,000 to spend.
A hard or soft landing is important. Hard landing = nothing to come back to for 5 years.
US house prices are alot lower than Ireland - possibly 50% lower in real terms. So if they are having a hard time .........
A hard or soft landing is important. Hard landing = nothing to come back to for 5 years.
US house prices are alot lower than Ireland - possibly 50% lower in real terms. So if they are having a hard time .........
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A key issue is measuring the size of the bubble in Ireland relative to other markets.
But even a soft landing would deal a crippling blow to an economy heavily reliant on construction and equity release to keep the exchequers coffers full and the tills ringing.
I think the Celtic Tiger has morphed into an entirely different beast, I was trying to think of a suitable animalistic replacement and realised that James Joyce had penned the perfect description; 'The sow that eats her farrow' his description of Ireland nearly ninety years ago.
bearishbull
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Yeah i wouldnt trust that guy as far as i could throw him, real cute hoor type, "remortage to buy an investment property" WTF!!! and telling people to bring a fair bit of cash to an investment so your rent comes near covering your interest repayments! does this guy not understand that the cash an "investor" brings to a property purchase is part of the capital invested and has an opportunity cost? He seems to think remortgaging to buy an investment property reduced risk in some way
, I give up on this country, the media let the vested interests spin the news all the time and dont address the fundamentals of the market in detail at all, does no one in media try and rationalise the fact that rents are the same or lower than 6 years ago and incomes havent risen by much while house prices have nearly doubled. Newstalk are the only ones who seem to address the risks and irrational nature of the market by letting jill kerby warn all young FTBs.
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z108
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bearishbull
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Todays show from 6-7pm
He seems to think remortgaging to buy an investment property reduced risk in some way
"You're cushioning the effects," to use his exact words. Effects of what I would love to have known.
The IPAV guide to investment: "Spread your risk by having two mortgages instead of one!"
bearishbull
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I dont know where Mr Hughes got his economics degree but how can he say that recent speculation has not driven price increases? Investors make up circa 40% of market, they are creating excess demand which is driving prices up,if numbers of investors halved overnight a year ago then prices wouldnt have risen by as much but rents may have risen by a greater amount.
His collegue launching the report with him today says a soft landing is on the cards, but we all know that a soft landing is impossibel as the 40% of market that is buying for "investment" will shrink when the slow/zero capital growth arrives next year.
http://www.rte.ie/business/2006/0904/property.html
However, speaking at a Dublin seminar today Tom Foley, CEO of IIB Homeloans, said a number of factors suggest that house price growth is set to ease back through 2007and that the market was set to undergo some big changes.
'We are now entering a transition from a period of explosive growth. I'd be optimistic that we'll see a fairly gentle slowdown to a calmer pace of growth in both lending and in the property market', he said.
He would say that wouldnt he! Who beleives the bankers???
His collegue launching the report with him today says a soft landing is on the cards, but we all know that a soft landing is impossibel as the 40% of market that is buying for "investment" will shrink when the slow/zero capital growth arrives next year.
http://www.rte.ie/business/2006/0904/property.html
However, speaking at a Dublin seminar today Tom Foley, CEO of IIB Homeloans, said a number of factors suggest that house price growth is set to ease back through 2007and that the market was set to undergo some big changes.
'We are now entering a transition from a period of explosive growth. I'd be optimistic that we'll see a fairly gentle slowdown to a calmer pace of growth in both lending and in the property market', he said.
He would say that wouldnt he! Who beleives the bankers???
"House prices always go up, just look over the last 100 years"... I nearly crashed the car...
I think people like this are either delusional or evil.
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