Current public sentiment towards the housing market?

[tententwenty]

Ok in reality the losing FTB then bids like a mad man on the next place but at some point people just have to have personal discipline and walk away from auctions when their price limit is exceeded.

This is know within Game Theory as the Winners Curse.

Its known in Ireland as a property crash.

 

[gearoidmm]

Theres plenty wrong with it. For a start it leads to spiralling house prices and a looming collapse, with consequent knock on effects for the entire economy, which is what we have today. An investor wants to buy many houses, a FTB only wants one. Once its bought, they are out of the market, but the specualtor will keep buying and driving up prices.

That's not true. If the market was behaving rationally, investors would continue to outbid FTBs until there came a time when there were too many investment properties out there and rents and occupancy began to fall. At that point, investors would lose interest in the market and FTBs would have it all to themselves. In practice, this is what has happened always. You need a mix of investors and FTBs out there to keep the market going - otherwise where would the renters live. If my landlady had not bought my place many moons ago, I'd be forced to join in the race for a FTB house - eeek.

Unfortunately, in Ireland this no longer applies and everyone (FTBs and investors alike) are bidding up the price of houses to a point where traditional measures of value are left behind (ie salary multiples and rental yields). Eventually, you can be sure that the market will sort this all out.

 

[Howitzer]

Theres plenty wrong with it. For a start it leads to spiralling house prices and a looming collapse, with consequent knock on effects for the entire economy, which is what we have today. An investor wants to buy many houses, a FTB only wants one. Once its bought, they are out of the market, but the speculator will keep buying and driving up prices.

You make it sound like you feel the average semi d should cost 10 shillings and 6 pence. That prices should never go up and anyone caught bidding more than the last person should be given the lash.

 

[tententwenty]

I'd prefer to have it put back in my own pocket in the form of reduced taxes.

Ah yes social Darwinisim. The 19th century called, it wants its society back.

Blindjustice said that the government never tried to prevent investors outbidding FTBs, implying this was a bad thing. Unless you hold Venezuala and Cuba as role models for a utopian society, I fail to see why this would be a good thing.

Or, possibly, Sweden.

The situation we have today hasn't been caused by investors outbidding FTBs. It has been caused by FTBs outbidding investors. If FTBs weren't willing to pay ludicrous sums of money for a house there would be no market for the speculators who buy houses at inflated prices and sell them on to FTBs at even more inflated prices.

Of course, speculators never sell to other speculators, its the "in crowd" selling to the boobs. Eh I'm going to have to stop this here. If you really believe that, theres no point in me saying anything more to you.

 

[tententwenty]

That's not true. If the market was behaving rationally, investors would continue to outbid FTBs until there came a time when there were too many investment properties out there and rents and occupancy began to fall.

And you have just described the Ireland of today.

At that point, investors would lose interest in the market and FTBs would have it all to themselves. In practice, this is what has happened always.

You think speculators never sell to speculators?

Eventually, you can be sure that the market will sort this all out.

Very true. And very shortly too, IMHO.

 

[tententwenty]

You make it sound like you feel the average semi d should cost 10 shillings and 6 pence. That prices should never go up and anyone caught bidding more than the last person should be given the lash.

I have a Modest Proposal for you...

By the way, lets privatise healthcare too. Damn slackers, sponging off the healthy. Because housing and healthcare are on an equivalent level, I mean.

 

[room305]

Ah yes social Darwinisim. The 19th century called, it wants its society back.

My mistake. I slept through the global communist uprising and still live in a time when low taxes, high employment and a small but efficient government are considered a good ideal. How you must laugh at fools like me left still believing in capitalism.

Or, possibly, Sweden.

That's funny because knowing someone from Stockholm, the one thing she hates about the place is that you have to be put on a list for years to get anywhere decent to rent.

Of course, speculators never sell to other speculators, its the "in crowd" selling to the boobs. Eh I'm going to have to stop this here. If you really believe that, theres no point in me saying anything more to you.

And I'm from the 19th century ...

 

[exile]

That's funny because knowing someone from Stockholm, the one thing she hates about the place is that you have to be put on a list for years to get anywhere decent to rent.

True, it's almost the other extreme. I doubt she complained about the size of the rent though - or that she could buy an apartment for about 100,000 Euro.

 

[whathome]

I wonder if Noel Ahern's attack on Speculators might have been the result of a misunderstanding at the highest level of government....

Bertie's instructions:

"Noel - yer man Trichet from the ESB waz on da phone to me dere givin out again
... will ya do sumtin to sort out the flippin' property problem? ".

 

[fatmanknows]

Hear from a good source that the phones were hopping today in Gunne's, complaining about Monsieur Cassidy's predicitions of the easing of prices. It appears the nerves of some investors and the like are becoming increasingly fragile.

 

[blindjustice]

all this talk about capitalism and socialism and whether its a right to own a home or not!!
Come on!

the reality of ireland is ITS LIKE A CARTEL

 

[whathome]

Hear from a good source that the phones were hopping today in Gunne's, complaining about Monsieur Cassidy's predicitions of the easing of prices. It appears the nerves of some investors and the like are becoming increasingly fragile.

Good spot, I hadn't heard about this until you mentioned it.
Here's a link:

http://www.rte.ie/business/2006/0912/mibusiness.html

"GUNNE SEES PROPERTY BLAZE DYING OUT - Gunne has become the latest firm of auctioneers to call time on the roaring property market here. This morning it says the indications are that growth will ease considerably before the end of the year."

 

[Glenbhoy]

I'm not advocating government sponsored socialised housing across the board, just the severe cracking down on speculators and irresponsible lending practices, possibly marketing practices, and most certainly on the corruption that appears to be endemic to the zoning process and planning permission. That should get housing down to its historic norms, which as I recall were more like 3-4 times average wage than 5-6 times, although I would agree that inflation has reduced a good deal since then, so maybe 5 times average wage is closer to sustainable. Hardly utopian aspirations, there.

Can you elaborate on the endemic corruption in the zoning and planning process (current examples please)?
How/why should speculators be cracked down on, do you mean recent entrants into the speculating game or the old hands who've been at it for years? Is there not already government regulation, taxes etc, both income and cgt?
As for cracking down on lending and marketing practices, firstly, surely it's up to a lender to adequately vet their own loans, they can assess the likelihood of default better than any civil servant, after all, they're hit in the event of default too. Secondly, as I stated before, lenders don't force anyone to take out a loan, are you suggesting that borrowers are incapable of making the decision for themselves, and that some government agency should make that decision for them?
As for your assumption of 5 times average wage, where does that come from? Do you mean average household wages (given two parties working), in which case it's pretty close to what we currently have.
I do agree that houses are overpriced in this country btw, but I will not accept that speculators bear the responsibility for that, investors take advantage of prevailing conditions, many recent investors probably shouldn't have got involved, they'll learn the hard way (possibly), in fact, will recent investors (many of them are of the traders up who retain property no.1) not be the hardest hit of any sector? Double mortgage, probably well over-extended with little or no rental income from property no.1.....

 

[Maine]

Good spot, I hadn't heard about this until you mentioned it.
Here's a link:

http://www.rte.ie/business/2006/0912/mibusiness.html

"GUNNE SEES PROPERTY BLAZE DYING OUT - Gunne has become the latest firm of auctioneers to call time on the roaring property market here. This morning it says the indications are that growth will ease considerably before the end of the year."

This is very strange UNLESS it is directed at reluctant sellers and is intended to get them to lower their prices to shift the houses. It may be that Gunnes are tired of sellers attempting to get April 2006 prices for property. Lower priced sales are better to EAs than none.

Is it correct to think that Gunnes doesnt sell alot of large FTB developments hence are under no pressures from the developers. Therefore upsetting the FTB market in the short term is worth it if they can get the suburban sellers to lower their prices and expectations.

Looks like April May was a great time to be selling EA firms...........

 

[whathome]

Is it correct to think that Gunnes doesnt sell alot of large FTB developments hence are under no pressures from the developers

Apart from the "been for sale since February and first release still hasn't sold out despite lowering starting prices and already having a bus stop!" development at Adamstown

 

[tententwenty]

Can you elaborate on the endemic corruption in the zoning and planning process (current examples please)?
How/why should speculators be cracked down on, do you mean recent entrants into the speculating game or the old hands who've been at it for years? Is there not already government regulation, taxes etc, both income and cgt?
As for cracking down on lending and marketing practices, firstly, surely it's up to a lender to adequately vet their own loans, they can assess the likelihood of default better than any civil servant, after all, they're hit in the event of default too. Secondly, as I stated before, lenders don't force anyone to take out a loan, are you suggesting that borrowers are incapable of making the decision for themselves, and that some government agency should make that decision for them?
As for your assumption of 5 times average wage, where does that come from? Do you mean average household wages (given two parties working), in which case it's pretty close to what we currently have.
I do agree that houses are overpriced in this country btw, but I will not accept that speculators bear the responsibility for that, investors take advantage of prevailing conditions, many recent investors probably shouldn't have got involved, they'll learn the hard way (possibly), in fact, will recent investors (many of them are of the traders up who retain property no.1) not be the hardest hit of any sector? Double mortgage, probably well over-extended with little or no rental income from property no.1.....

You have repeatedly provided information that is both misleading and flat out wrong throughout this discussion to support your own points, asking questions that have already been answered, and have a habit of waiting until after a discussion has died down to come flying in from the wings with your knickers around your ankles, trying to score the odd parting shot. Perhaps someone else would like to field that.

I really don't see much point in discussing anything with you, either.

Good luck with those old hands, though.

 

[Maine]

Apart from the "been for sale since February and first release still hasn't sold out despite lowering starting prices and already having a bus stop!" development at Adamstown

Gunnes have clearly missed all the fast selling bonuses on that then and money to be made on those remaining will be less than 2 semi ds in suburbia

 

[liteweight]

I wonder if Noel Ahern's attack on Speculators might have been the result of a misunderstanding at the highest level of government....

Bertie's instructions:

"Noel - yer man Trichet from the ESB waz on da phone to me dere givin out again
... will ya do sumtin to sort out the flippin' property problem? ".

Very good!

 

[Maine]

As for cracking down on lending and marketing practices, firstly, surely it's up to a lender to adequately vet their own loans, they can assess the likelihood of default better than any civil servant, after all, they're hit in the event of default too.

A lender is a group of mainly senior individuals who get bonuses from advancing more money. If a bank collapses in the coming downturn then most likely they will call on the govt to get them out of trouble whether we like it or not. Reference AIB in the 1980s - would have gone bust without the govt. Also reference current Fitch ratings on the banks which clearly states they have lent too much.

 

[redo]

....and your posts cast no shadow