Current public sentiment towards the housing market?

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umop3p!sdn said:
How does that work? - I thought with interest only mortgages, you're only paying off the interest, so you always owe the amount borrowed.
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Either (1) it is an investment so you accept that you're only getting the capital upside - you never intend to pay it off. You "roll-over" the mortgage long-term or (2) if it is against your PPR you have a savings vehicle (pension, equities, stake in a business etc.) which will pay off the loan when you retire.

Option (2), particularly with a pension, is very popular in the UK but much less so in Ireland. The mortgage we have for our London house is set up in exactly this way.
 
Anyone notice the addition of the word '' region '' before the prices on daft?.
 
They're giving the "asking price" under some houses now in the Examiner property supplement which I have'nt seen up until last week.

A 3 bed semi in my area costs about €750 pm to rent but around €1500+pm to buy, I simply do not see the logic of buying these things if 100,000 more of them are going to be built next year.
They say towards the end of a financial mania, the last few rational people start questioning themselves, asking 'is it me that is crazy?' That
point has surely been reached in Ireland.
It seems to me that most of the people that were going to buy, have bought, and that in a rising interest rate environment there has to be a finite number of people willing/able to borrow €400,000 to buy a flatpack semi in a country with the population of Greater Manchester and more land than you can shake a stick at...

'We learn from history that we do not learn from history' - Hegel
 
Contrarian said:
They're giving the "asking price" under some houses now in the Examiner property supplement which I have'nt seen up until last week.

A 3 bed semi in my area costs about €750 pm to rent but around €1500+pm to buy, I simply do not see the logic of buying these things if 100,000 more of them are going to be built next year.
They say towards the end of a financial mania, the last few rational people start questioning themselves, asking 'is it me that is crazy?' That
point has surely been reached in Ireland.
It seems to me that most of the people that were going to buy, have bought, and that in a rising interest rate environment there has to be a finite number of people willing/able to borrow €400,000 to buy a flatpack semi in a country with the population of Greater Manchester and more land than you can shake a stick at...

'We learn from history that we do not learn from history' - Hegel
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house in my area renting for 34% of equivalent repayment mortgage (house "valued" close to a million), NONSENSE!!!
 
Ive just looked at the Property Investment page on this website and have noticed two threads on it enquiring about selling investment properties. The sentiment has definitely changed. Many people who invested on the upswing had the smug attitude that they could always sell out when the tide started turning. The problem with this strategy is that it will be very hard to sell now that buyers know the tide has turned. There was an article in the independent today about house auctions in dublin last week attracting no bids. The only way now for sellers to attract bids is to start asking for much lower asking prices. A lot of investors are now going to find out how illiquid property really is and in a downturn houses may be on the market years.
 
evan said:
Ive just looked at the Property Investment page on this website and have noticed two threads on it enquiring about selling investment properties. The sentiment has definitely changed.
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Two threads about selling investment property mean that sentiment has changed? :confused:
 
That little segment is a classic. I love this quote:

Reports this morning said Junior Minister Noel Ahern had expressed concern that the banks were willing to give out so much money to home-buyers, thereby fuelling the "hype" surrounding the property market.
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From the party that has done nothing but "hype" the property mania since its inception. He might also want to chastise his brother for all the hyping he has been doing.

I actually live in Noel Ahern's constituency and had been greatly looking forward to asking him some tough questions about the housing boom in the run up to the election. Not least because of a comment he made on Newstalk a few months back, where he claimed that houses are even more affordable now than in 1995 because wage increases have kept pace or outpaced the rise in house prices. When I relayed the comment to a neighbour her reaction was "Yeah, his wages maybe".

You can bet that Noel Ahern didn't make this comment without some serious feedback from the doorsteps of his consituency ...
 
evan said:
Ive just looked at the Property Investment page on this website and have noticed two threads on it enquiring about selling investment properties. The sentiment has definitely changed. Many people who invested on the upswing had the smug attitude that they could always sell out when the tide started turning. The problem with this strategy is that it will be very hard to sell now that buyers know the tide has turned. There was an article in the independent today about house auctions in dublin last week attracting no bids. The only way now for sellers to attract bids is to start asking for much lower asking prices. A lot of investors are now going to find out how illiquid property really is and in a downturn houses may be on the market years.
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Guys, we should be careful not to clutch at straws like the UK's housepricecrash forum. You read things on there like "I heard someone on the bus say that they're having payment challenges - the crash is on"!!!

If the tide does turn it will take 12-18 months before the general population really believe it has turned - the SSIA money and election giveaways will cushion the effect into 2007.
 
Neffa said:
Guys, we should be careful not to clutch at straws like the UK's housepricecrash forum. You read things on there like "I heard someone on the bus say that they're having payment challenges - the crash is on"!!!

If the tide does turn it will take 12-18 months before the general population really believe it has turned - the SSIA money and election giveaways will cushion the effect into 2007.
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very good point. I think you won't really be able to call a down turn until after at least 2 or 3 months of serious price declines. Otherwise there is too high a chance it is just a wobble and not an actually collapse.

I'm not sure it will take a full 12 to 18 months for public opinion to change, but it would definitly take 6 or more before your Gran and aunts to stop asking "have you bought yet?"
 
I know the SSIAs are only starting to mature now and the bulk of them won't mature till 2007. However I think the SSIA-effect has already been priced in to the market. FTBs etc are getting loans from parents, credit unions etc for deposit or stamp duty which they will then pay back in 6 months time once their SSIA matures.

I don't really have any evidence for this, just a hunch based on my own thinking as a potential FTB. Would be interested to hear other people's comments on this.
 
Neffa said:
Guys, we should be careful not to clutch at straws like the UK's housepricecrash forum. You read things on there like "I heard someone on the bus say that they're having payment challenges - the crash is on"!!!

If the tide does turn it will take 12-18 months before the general population really believe it has turned - the SSIA money and election giveaways will cushion the effect into 2007.
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Good point, ECB will have to go to 3.5% before the squeeze starts to really bite IMO. Prices will be sticky on the way down and as judging by what is going on in the US where they peaked in the Autumn of last year they have not come down that much (and that is even with the Fed continously increasing rates).

I do however detect that the general change in sentiment coming from the print media is starting to be discussed in the canteen a bit more that in previous months
 
Neffa said:
Guys, we should be careful not to clutch at straws like the UK's housepricecrash forum. You read things on there like "I heard someone on the bus say that they're having payment challenges - the crash is on"!!!
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This thread isn't trying to call the top of the market or chart the crash, it was set up to try and assess public sentiment towards the housing market. Last year Joe Punter would have told you housing was a one way bet, couldn't lose no matter what, etc. Now I'm detecting a slight change in that stance, more caution, an acknowledgement that maybe things have run away with themselves but still reasonably confident that property is a good medium-long term bet.

Of course, it is important to try and find any evidence of this. The Daily Mail have an article today pointing out how flawed the recent report placing us as the second wealthiest nation in the world is. I don't have a link but here is an example quote:

Bank of Ireland researchers call it wealth, but one may as well call it a pyramid scheme.
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The media don't think dictate public opinion but try to reflect it. There has been a lot of bearish comment in the media recently about the Irish property market and this is filtering down.
 
beattie said:
Good point, ECB will have to go to 3.5% before the squeeze starts to really bite IMO. Prices will be sticky on the way down and as judging by what is going on in the US where they peaked in the Autumn of last year they have not come down that much (and that is even with the Fed continously increasing rates).

I do however detect that the general change in sentiment coming from the print media is starting to be discussed in the canteen a bit more that in previous months
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I would say many properties in the US have fallen dramatically, particularly in the former "hot" markets - Florida, California etc. However, many borrowers have been shielded by the fixed portion of their hybrid ARMs. The bulk of these are set to reset to above the current interest rate (5.25%) in the next few years. Some financial columnists have referred to this as a "ticking time bomb".
 
wow this thread hasn't half turned out popular , results of the poll i'm running are pretty interesting as well (though only 100 votes so far so suppose you could call it a snapshot kinda poll at the moment)

I own property and am bullish - 23.23%
I own a property and am bearish - 28.28%
I do not own property and am bullish - 11.11%
I do not own property and am bearish - 37.37%

total bullish : 34.34%
total bearish: 65.65%

definitenitely indicates a big shift in sentiment IMO and most notably among the FTB's when you compare non-owners who are bullish to non-owners who are bearish
 
Daft up 206 properties since friday to 14295 . It was 14089 when I first looked. 1.5% more properties for sale in 3 days.
 
In the US $300 billion of mortgages this year and $1 trillion next year will be switched to adjustable payments. The 2007 adjustments will almost certainly be the largest such turnover that has ever occurred. The effects could be colossal.
 
Contrarian said:
In the US $300 billion of mortgages this year and $1 trillion next year will be switched to adjustable payments. The 2007 adjustments will almost certainly be the largest such turnover that has ever occurred. The effects could be colossal.
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These are negative amortization mortgages are they not ????

They are not as common in Ireland . Allegedly !!!!!
 
2Pack said:
These are negative amortization mortgages are they not ????

They are not as common in Ireland . Allegedly !!!!!
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No, they are essentially variable interest loans with the first few years fixed. As contrarian mentioned, a huge amount of this fixed periods lapse next year. These people have not really felt the effect of the Fed's 17 month run of monthly 0.25% hikes. For many of them it may be akin to a sudden 400% increase in the interest component of their mortgage repayments.
 
Speaking from my experience in the once hot Florida market, prices have fallen 10%-15% from their peak in just the past year. That is simply based on what I thought my house was worth a year ago, and what it could sell for now. The official figures published by the NAR claim it has only dropped 2%. Once the specu-vestors stopped buying, the market took a sharp nosedive and everyone realized the building boom overshot demand. I'm not sure where prices will bottom out, but I know we're not even close yet. It will be a very ugly ride on the way down as everyones net worth is slashed in half and will likely take years to fully play out. I fear the situation in Dublin could turn quicker than most people think. A little bad press goes a long way to sway public opinion. Most of my friends in Dublin have jobs related to the construction business and I worry about their future. I think we all know what is coming for Irish property prices, but are we really prepared for it (lost jobs, bankruptcy, recession??)
 
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