Current public sentiment towards the housing market?

Status
Not open for further replies.
You're probably right in your assertion that it will take a global slump to
effect these changes but it looks like these global changes are already
happening.

i. We can see from housing markets ahead of us in the curve (e.g. United
States, Australia) are already starting to take a hit in property values.

ii. There's many a prediction of the current global upswing cycle coming to
an end (e.g.
0000779e2340.html]IMF warns of ‘severe global slowdown’)

iii. Central banks around the world have donned their anti-inflation suites
and will likely sacrifice jobs to contain inflation if they have to.
 
ivuernis said:

You're probably right in your assertion that it will take a global slump to
effect these changes but it looks like these global changes are already
happening.
Click to expand...

FF are praying for a global slump prior to the next election - this would be a perfect scapegoat.
 
CelloPoint said:
Of course there's a way: The Affordable Housing Scheme.
Click to expand...
Garrett the Good was mentioning this too, but I don't see how increased social and affordable housing will help bring about a soft landing. Is the one of the main tenets of the bubble theory not that we have too many investors in the market? If this is the case will the provision of homes for people who currently rent not cause investors to exit the market? Hence, oversupply of property followed by a big pop of the bubble??
 
CelloPoint said:
FF are praying for a global slump prior to the next election - this would be a perfect scapegoat.
Click to expand...

I very much doubt this CelloPoint. Perfect scapegoat or not, FF are well aware that the economy is the key to them holding power. Irregardless of the global economic and/or housing situation I expect them to play the everything-is-fine-this-party-is-barely-getting-started line right up until the regain their seats. After which they will blame any problems on forces outside of their control.

Has everyone forgotten the 2002 election already? No wonder they keep getting back in ...
 
While bearish on property in Ireland, I don't think that the bubble has started to burst particularly in the "starter home segment". I have been watching a particular small apartment block (in a village about 35 miles from Dublin) over the last year or so. Many of these apartments have been sold during this period. The apartments are mostly of similar size and spec with some minor differences but ten months ago one sold for 205K. A few more sold since then but I couldn't find out how much they sold for. Over three months ago two were sold at 235. In the case of one of them, after dicking around for over three months the purchaser pulled out. This one was put back on the market and immediately sold for 245. At about the same time another one sold for 250 (but this one I believe was exceptionally well fitted out - Jacuzzi, etc.). This anecdote is worth noting because these are actual prices paid for the apartments - not advertised prices and more importantly because many of them (six or seven) have changed hands over the last year, the number of datapoints is relatively large.
 
The Baltimore Sun. “Greg Siciliano first put his Ocean City bayside condo on the market for $699,000 in May. By August, he had dropped the price of the two-year-old, two-story condo to $550,000, and had thrown into the package two WaveRunners and the pier out back. ‘I’m just a little discouraged with the lack of interest,’ said Siciliano.”
“He and other sellers have found their properties stuck in a glut of condos and townhouses that have flooded the market. Siciliano’s condo is one of nearly 1,700 condos for sale in Ocean City, and there is nearly twice as much inventory as in July 2005. In the first half of this year, 528 condos were sold in Ocean City, 42 percent fewer than in the first half of last year.”
“Linda Moran, a real estate agent in Ocean City, said she started noticing the slowdown in October. ‘It progressively has gotten worse, with more and more people putting properties on the market and less and less buyers,’ Moran said. ‘We’re at the saturation point of listings at this point, but they’re not selling.’”
 
Wow, so those ARMs aren't even IO mortgages!!! I guess that's another option that the Irish banks have, to allow them lend even more money for even higher priced houses. :-/
Is there anything to actually prevent such a product being introduced over here?
 
Not that it means anything,but here is a graph of daft.ie's number of houses for sale nationally in July and August.

 
Many ARMs have what are in effect inducement rates for the first number of years, and we have similar over here. The inducement rates however target the financially naive - e.g. how can someone with any financial sense believe that it is possible to go from a 5.5% fixed rate to a 1.5% ARM with no cost, yet many have. After the inducement rate period ends, the ARM jumps to 7/8/9%, and the original fixed rate is no longer available.
 
God help us all if they're introduced here....
 

Given the toothlessness of the regulator over the 100% mortgages I'm inclined to think these would be allowed.
 
room305 said:
Given the toothlessness of the regulator over the 100% mortgages I'm inclined to think these would be allowed.
Click to expand...

Therefore these could add a few more years and another 20+% to HPI so should we buy now?
 
"Elvis has left the building"

1996 - new Dublin three bed semi - 90k net bought
2006 - original Dublin three bed semi - 600 gross sold

Irish HPI over the last decade.................priceless
 

But we don't have any inducement rates where the principal, total repayment amount, is actually building up as you're making your monthly repayments. Even some sort of discounted IO mortgage would at least (by very definition) pay off all the owed interest each month, meaning the principal owed is staying constant. And with the inducement discounted rates on normal mortgages, you're paying off some of the principal along with the reduced interest. So when the reduced rate no longer applies, you have some of the principal paid off.

The nearest analogy we have that I can think of is the repayment holiday (often for 3 months, taken at the beginning of the mortgage). In this case the principal will build up over those first three months, and probably takes quite a few more months before you get it down to the original amount.

Edit: Even if they could get away with it, I would hope the Irish banks are prudent enough not to introduce such a product over here. The possibility of negative publicity in any future misselling scandal, along with threatened legal action, should frighten them away from introducing such a product. Please tell me I'm not being naive...
 
These are the same flutes that were advising people to get offshore accounts a while back? Banks have a nice respectable veneer, but believe me nothing could be further from the truth.
 
My sentiment at the housing market at the moment is a mix of bitterness anger and sadness
If it continues younger couples will be crucified with unmerciful mortgages over crazy lenghts of time living in small apartments and pitiful excuses for houses. i think a levelling off or "soft landing" will only allow this to continue.
if it crashes the economy is in big trouble.
which is the lesser evil?
 
http://www.baltimoresun.com/busines...,357896.story?coll=bal-realestate-headlines-1

"KB Home, the No. 6 U.S. homebuilder by stock market value, lowered its 2006 earnings forecast Wednesday after quarterly orders plunged, and Hovnanian Enterprises Inc., the No. 10 builder, reported profit fell 34 percent.

Yesterday, Beazer Homes USA Inc., No. 12, lowered its forecast after orders fell by half.

Short-term housing investors, so-called "flippers," are putting their properties up for sale, making for "an increasingly challenging housing market," KB Home Chief Executive Officer Bruce Karatz said in a statement that detailed the builder's 43 percent drop in new .

What is amazing is the sheer scale of decreases for huge corporations...these are not 3% or 4% fall offs. This is a nosedive however we need it to level off in the next few months to avoid serious problems here given our house prices and supply are alot higher.
 
Last edited:
A lovely house in my area has been on market for months,got a write up in Sunday Business Post before going to auction in May but did'nt sell and is now for sale by private treaty for 1.3million it had been on sale at auction with an AMV of 1.45million in May. Another on same road sold for 1.25 mill in March at auction having had an AMV of 950k
[broken link removed]

[broken link removed]=
Must have trouble selling at lower price as its on market all summer, and its not the type of house you'd expect to remain on market long if sentiment was positive.
 
Status
Not open for further replies.
Menu
Log in
Register