Current public sentiment towards the housing market?

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Calina said:
I'm not saying this because property prices grew by 270% in the past 10 years. I'm saying it because salaries did not.
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Exactly - that was my Pauline coversion moment from Bull to Bear... when I realised that the 1st house I bought (in 2001) would now require a salary of €90k to finance its purchase.
It makes absolutely no sense, however you dress it up.
 
Billo said:
After years of this thread,the bulls are still laughing all the way to the banks.
Rgds
Billo
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After years of 100 smokes-a-day habit I still havent got cancer.

After years of driving 100mph down those country lanes I havent hit anything.

After years of travelling abroad uninsured I'll never need it in the future.

etc etc

yawn.
 
Exile

I am pointing out that although my salary doubled and a bit (10 years more experience mind), however my house (real bought and sold values) had increased over six fold, only difference - interest rates and fiat money
 
derryman said:
Exile

I am pointing out that although my salary doubled and a bit (10 years more experience mind), however my house (real bought and sold values) had increased over six fold, only difference - interest rates and fiat money
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Yep, I got it the second time I read it Question is - what is someone with 10 years fewer experience doing your job earning now?
 
Exile

I an IT project manager now, IT developer then - thing is if you ignore the hyped up skills (c## etc), the IT developer now is barely earning more, believe me I know, I work for a MNC and people care manage some 5 years experience developers on 40k euro. That is the absurdity of it all.
 
Sidewinder said:
Just remember dude: "When the last bear turns bull...."

The fact that even you are now feeling the lure of the Dark Side in itself is proof that this bubble has already burst.
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Good point! Perhaps I have a inner compass that is the inverse of market sentiment?! That could be useful!
 
Billo said:
After years of this thread,the bulls are still laughing all the way to the banks.
Rgds
Billo
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the following is when this thread began :05-07-2006, 10:21 AM
NOT YEARS AGO!!
this is the very first post below:

 
walk2dewater said:
After years of 100 smokes-a-day habit I still havent got cancer.

After years of driving 100mph down those country lanes I havent hit anything.

After years of travelling abroad uninsured I'll never need it in the future.

etc etc

yawn.
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It's no wonder your tired, with all those posts in a short space of time
 
exile said:
Yep, I got it the second time I read it Question is - what is someone with 10 years fewer experience doing your job earning now?
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I'm a recent Microelectronics Graduate, I earn less now than a graduate earned in 1999, that's less in absolute terms not even taking into account inflation
 
That previous thread title is predicting falls of 20%, people here are now predicting falls of 50%, both say that the 2001 levels were the 'true' levels so the two threads don't contradict.
 
daveirl said:
That previous thread title is predicting falls of 20%, people here are now predicting falls of 50%, both say that the 2001 levels were the 'true' levels so the two threads don't contradict.
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Call me an Uberbear but I think 2001 levels were actually the natural peak of the cycle in Ireland. There is plenty of evidence that house prices in Ireland had stabilised and were actually falling off slightly in the Spring/Summer of 2001.

And then the Fed injected massive liquidity in order to push forward the effects of the unwinding of the dot-com bubble, Germany was still paying off the costs of reunification, Japan was still stuck in deflation with interest rates of 0% creating the Yen carry trade, and China was helping things along with the deflationary effects in Western economies of cheap Chinese goods.

And we Irish went buck mad altogether.

The four major trends above have all now reversed/ended, and there will be hell to pay.

I'd say true equilibrium house prices in Ireland are 1999 levels (adjusted for inflation).
 
From Belgium. “The boom in the Belgian housing market has past its peak, a new report indicated. ‘Due to the very favourable mortgage conditions, buyers bought larger houses or in more expensive locations,’ ERA Belgium director Iain Cook said. But that does not mean that a row house with three bedrooms has also increased so much in price.”
“Unfortunately, sellers have not realised this, Cook said. It means that more and more houses are being put up for sale at an exaggerated price and are therefore difficult to sell.”

From Australia. “Welcome to the dark side of the housing boom. The question is, why have we borrowed so much more today? See the point? We took the benefit of lower interest rates and used it to achieve little more than a doubling in the price of homes.”

From New Zealand. “A slowdown in sales of higher priced houses has put a stop to rising prices in the city’s residential property market. The median selling price slipped $9000 in August at Mount Maunganui and Papamoa, and across the harbour the fall was even bigger, more than $12,000. ‘If you scratch under the surface at the moment there’s nothing much happening,’ said John O’Donnell, principal of LJ Hooker Mount Maunganui.”
“‘Life is not as exciting as some people would like. There are no great trends in the marketplace and prices are definitely not going up,’ he said.”

The National Post in Canada. “Royal Bank of Canada singled out the Vancouver market as ‘unsustainable,’ based on the fact the current median household income in the city of $54,912 means a typical family would have to shell out 72.8% of their pre-tax income to meet all the expenses of owning an average two-storey home.”

The New York Sun. “Money manager James Melcher adds that most people believe higher short-term interest rates, increased minimum monthly repayment levels for credit card debt, higher energy prices, the inability of households overburdened with debts to refinance homes in a declining market, the fact that wage earners have had no increase in inflation-adjusted earnings over the past several years, and a variety of other seriously negative factors will only slow consumer spending a fraction of a percent.’”
“‘We suspect that most of them also believe in Santa Claus and the Tooth Fairy,’ he quips.”
 
Billo said:
Yes I would. But like everything else you have to shop around for good location and price.

Billo
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Shoping around is definitely a good idea as a build up of inventory and houses sitting on the market for a while are resulting in price cuts in many areas.

The investor can use this to his/her advantage in negotiating but then he should also realise as he forks out on stamp duty and other significant costs that he's buying an asset whose market value is weakening and whose yield is pitiful.
 
There are many farmers sitting on 2m plus farms earning 40k. They are being advised to borrow against the farm and invest in property eg golf courses in Florida. Note farms can be rented for less now than 20 years ago. PE ratios are above 200 while top Irish companies are below 15.

Most of these farmers would be better advised to sell part of the farm at current huge prices and then invest it. This way the risk is balanced.

Banks are only loaning to this market because of property boom means they think can sell the farms easily if need be. Hence if property was to slip banks will shut the taps off quickly and go back to income based borrowing as they were between 1990 and 2000. Incomes are so low that loans values would collapse.
 
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Billo said:
Yes I would. But like everything else you have to shop around for good location and price.

Billo
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So you think rental yields of 1 or 2 or 3% gross are good despite the cost of finance rising and even the banks saying capital appreciation will slow to 3% or less next year?? Your on course to be the next Donald Trump for sure!
 
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