Current public sentiment towards the housing market?

howstrange said:

Is it possible that a lot of potential home buyers are hoping for some kind of relief in stamp duty in the December budget and are holding out until maybe the new year before they decide to buy?? Cos if there is a chance of a change in stamp duty bands then you be mad to buy now unless you really had to. It may not be just to do with sentiment and interest rates. Am i correct? If thats the case things might pick up again early next year. I am a bear by the way. Was just a thought.

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I think that this certainly could be a factor. Michael McDowell isn't exactly known for his skill of thinking things through fully before blurting them out. Announcing possible changes to stamp duty might make some potential buyers wait awhile longer and encourage the current slowdown.

I don't know about things picking up next year though... By the time the budget comes out next December interest rates are almost certainly going to be higher, by .5 percent at least. This is going to further erode affordability and less and less FTBers will be able to buy in at last years prices (assuming of course that wages don't spike up by a huge precentage to compensate). This will make it hard for trader uppers to get rid of their old properties and affect other parts throughout the market.

The only way it would realistically pick up again would be if the ECB stopped raising rates or even began to drop them. I don't think we have a chance of seeing something like that happening until well into next year (if even then).

McDowell is not doing the budget, Cowen is. My understanding is that stamp duty changes will be in the manifesto for the next election and IF the PD's enter coalition it will be on the agenda for the programme for government negotiations going forward.

The budget for this year must be nearly in place now, so unless there is a massive crash over the next 6-8 weeks the budget won't include anything to prop up the falling market. Most of the stamp duty is already in the coffers for the year, so by the time alarm bells start ringing when the money stops pouring in the budget will have passed.

MadPad said:

Nor should they, nor should the taxpayer subsidise any loss on "investments", be that directly or with any more tax breaks than what currently exists. Or the taxpayer must not be forced to bail out the banks and credit unions who have loaned people more than they can pay back, often with a nod and a wink. Let them shave their margins if rates rise through 2007, or let them be bought out.... Screw them, they changed the rules on salary multiples...

With a general election coming, if the posts here about increasing inventory are accurate, there will be pressure to increase mortgage tax relief, abolish VAT on building materials, abolish stamp duty, abolish PRSI for construction workers, buy unsold or half completed houses as public housing, anything to keep the party going. The only one I would even consider is buying public housing provided it could be demonstrated the taxpayer was getting them "at cost" and hence not getting screwed.

...

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I am nodding away with you here.

On affordable housing:

For someone in a position of power (and on the lookout for a bit of cream-skimming every now and then), buying "unsold or half completed houses as public housing" is the obvious solution. They've no alternative but to go down this road if the party is to keep going (indeed it would be a beneficial road for a select group of individuals).

Shakespeare's Macbeth:
"I am in blood
Stepped so far that, should I wade no more,
Returning were as tedious as go o'er"

walk2dewater said:

I do have to admit being surprised by how quickly the market turned in the US. Sentiment there has gone very sour very quickly; switch from greed to fear was almost instantaneous. Now Im thinking why not here?

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Nah it just appears to you now that it turned very quickly, but thats because its now on your radar more. Its happened here but its just not on everyones radar yet. If you are trying to sell a house say in Lucan then its more apparent or if your reading this thread it also is so.

The bubble has burst here. Just takes a while for everyone to find out.

Here are two houses in the same estate in Maynooth selling for different prices. Arguably one has a side extension, but is it really worth an extra 67K?

http://www.daft.ie/searchsale.daft?search=1&s[cc_id]=ct1&s[a_id]=2818&s[mnp]=&s[mxp]=&s[bd_no]=&s[search_type]=sale&s[refreshmap]=1&offset=30&limit=10&search_type=sale&id=127486

http://www.daft.ie/searchsale.daft?search=1&s[cc_id]=ct1&s[a_id]=2818&s[mnp]=&s[mxp]=&s[bd_no]=&s[search_type]=sale&s[refreshmap]=1&offset=10&limit=10&search_type=sale&id=138948

MadPad said:

With a general election coming, if the posts here about increasing inventory are accurate, there will be pressure to increase mortgage tax relief, abolish VAT on building materials, abolish stamp duty, abolish PRSI for construction workers, buy unsold or half completed houses as public housing, anything to keep the party going. The only one I would even consider is buying public housing provided it could be demonstrated the taxpayer was getting them "at cost" and hence not getting screwed.

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CelloPoint said:

On affordable housing:

For someone in a position of power (and on the lookout for a bit of cream-skimming every now and then), buying "unsold or half completed houses as public housing" is the obvious solution. They've no alternative but to go down this road if the party is to keep going (indeed it would be a beneficial road for a select group of individuals).

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Should be of interest so:

State losses cash windfall in swop for affordable houses

http://www.askaboutmoney.com/showthread.php?t=36615

CelloPoint said:

...For someone in a position of power (and on the lookout for a bit of cream-skimming every now and then), buying "unsold or half completed houses as public housing" is the obvious solution. They've no alternative but to go down this road if the party is to keep going (indeed it would be a beneficial road for a select group of individuals)....

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And on another note, I wonder if there'll be the same amount of post-crash bleatings and demand for compensation from those "mis-sold" interest-only loans as there was for the endowment policies of yesteryear. "They told us property could only go up... " etc.

howstrange said:

Is it possible that a lot of potential home buyers are hoping for some kind of relief in stamp duty in the December budget and are holding out until maybe the new year before they decide to buy?? Cos if there is a chance of a change in stamp duty bands then you be mad to buy now unless you really had to. It may not be just to do with sentiment and interest rates. Am i correct? If thats the case things might pick up again early next year. I am a bear by the way. Was just a thought.

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Aboloshing stamp duty can't be done: you'd have far too many pissed off voters (and their friends/families) who bought in recent years feeling hard done by.

CelloPoint said:

Aboloshing stamp duty can't be done: you'd have far too many pissed off voters (and their friends/families) who bought in recent years feeling hard done by.

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It was abolished for FTB on second hand homes upto a certain value around 2001/2002. Don't see why it can't happen again although I'd be surprised as I believe the gov will be afraid to touch it for fear of being blamed for what ever way the market goes, which is looking like down at the moment!

I'm going to Taser the next person who doesn't use a Daft short-code when posting a link..

I noticed in Bray several cases when houses were sold for less than asking price.
The most recent example -
[broken link removed]=
the initial asking price was 435 k. In a few weeks it became 410k. Few weeks later (the one u see on the link) it was 395k. No single offer!!!
Friend of mine was viewing it from the beggining thats why I know how prices were changing.
He proposed the price 381k not to pay an additional 3% of stamp duty and they agreed!!! So the price dropeed from 435k to 381 = 54 k
Yet he decided not to buy it
Another example can be
[broken link removed]=
Initial price was 415 by Douglas Newman Good, no offers. Now u can see the price 395 and as far as I know there are no offers. BTW they changed the agency since then.
Altogether, there are many houses on the market (Bray) for 1-2 months without offers from buyers. That was never the case before.
As somebody else in that thread noticed - agents are calling the day after viewing and asking what turned u off the house. Again - never the case before.

I am not sure that the prices will go down and houses market will collapse very soon, but the fact that prices will not be growing (or growing very slow) is almost certain.
And that effectivle means that investors will stop investing into property that much, which will reduce the demand by 20-40%.
So, in long term perspectives (5-10 years) prices will go down for sure.

bren2002 said:

[broken link removed]

I find this difficult to swallow. The agents are the ones advising on the prices to the vendors.

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They can point fingers and blame each other all they like but the reality check EAs and sellers are having now is that neither of them sets house prices - the buyers do !

The fact reamins that the bubble is bursting. You can't buy a house for 20% less then it cost 6 months ago - but you will soon.

Now - will Bertie allow a situation to arise where he has to knock on doors in April and face the question -
"why have you messed up the housing market with all these price drops?" Even he can't crocodile tear his way out of that one.

Whereas he can argue stamp duty changes "are to the benefit of first time buyers" till the cows come home! Could be a surprsise or two in a give away budget......

arbus said:

I am not sure that the prices will go down and houses market will collapse very soon, but the fact that prices will not be growing (or growing very slow) is almost certain.
And that effectivle means that investors will stop investing into property that much, which will reduce the demand by 20-40%.
So, in long term perspectives (5-10 years) prices will go down for sure.

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Prices are going up because prices are going up and everyone believes prices will continue to go up ad infinitum...

Ahem, or used to...

I'm opening a book on when Mr.Dunne (Sean) will start on his D4 Manhattan Style Developement - remember the one he paid €50m+ an acre for.

Current Odds -:

Never : No bets taken

Less than 1 year : 1000/1

1-3 years : 900/1

3-5 years : 800/1

5-10 years : 750/1

10 to 20 years : 100/1

Well Mr. Dunne can afford to sit on his 'asset' and do nothing!!

liteweight said:

Well Mr. Dunne can afford to sit on his 'asset' and do nothing!!

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Would it be correct to assume that most of the money that he has invested is not his own. It has either been borrowed or is from investors. More than likely he has very few assets in his own name. So even if there was a crash and the value of his portfolio dropped, he could afford to just walk away and let the others take the hit.

liteweight said:

Well Mr. Dunne can afford to sit on his 'asset' and do nothing!!

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Lots of us can afford to lose money, what's your point?

walk2dewater said:

Lots of us can afford to lose money, what's your point?

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It was a joke, hence the , asset...ass....get it?

fatmanknows said:

I'm opening a book on when Mr.Dunne (Sean) will start on his D4 Manhattan Style Developement - remember the one he paid €50m+ an acre for.

Current Odds -:

Never : No bets taken

Less than 1 year : 1000/1

1-3 years : 900/1

3-5 years : 800/1

5-10 years : 750/1

10 to 20 years : 100/1

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I think that the development only 'washed its face' at approx €1,000,000 per flat, and I think that AIB retain a lease on part of the site for the next 4 years. I don't think he will be making to many off plan sales in the current climate.