Current public sentiment towards the housing market?

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The lending rush of the past few years could get real nasty real soon...

Working couples in Dublin are spending just under €2,000-a-month or 37% of their incomes on
repayments, an increase of €375 since December 2005.
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unison
 
Throw in another 1% interest rate rise and that 37% rises to what? 50%?

God help us.
 
Here is a link to the full article from the Irish Property Buyer Magazine:

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Debtwish said:
Throw in another 1% interest rate rise and that 37% rises to what? 50%?

God help us.
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AFAIC, there'll be no "us". I'm not sticking around to help pay for someone else's debt/stupidity!

On that 2k pm @ 37% statistic, this means (in my humble calculations) that:

2k a month = 24k a year
24k a year @ 37% of salary => salary of 65k net
salary of 65k net => salary of ~98k gross (give a little tax relief)

So:
A way, way above average earner can buy a house in a way below average housing estate.
or
A Way above average earning couple can buy a house in a way below average housing estate.

It's the young educated people (20-25) I feel sorry for - they were in no way the cause of this mad situation, yet they are expected to contribute to the lower rungs of the pyramid by enslaving themselves to a life of commuting and overtime. The 20-25 year olds are smart though - I don't think they're that stupid (although I have come across one or two who've bought in to the false dream).
 
I'm still not so sure; Not meeting the asking price in my opinion is not such a big deal. Are the asking prices being set by the EA in the first place and if so then they are always gonna chance their arm. I think this may be just a reality check, maybe not a landslide but a gentle gradient. Looking at all the property being "developed" at the mo, it would suggest the property will flow gently down to sensible prices. BTW i dont own property, I'm just interested.
 
Bedsit said:
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Living the "dream" eh? 2-bed flat in D15, traffic, tight belt and a property management company's bit%h. What a waste of youth.

But sure as long as they're happy, isn't that all that matters? I'd say a market correction would soon wipe that stupid smirk off their (and their parents') faces.

Lol!
 

Sheesh.

Supply. Demand.

Basic law of all economics. We have massive oversupply right now, even before all the under-construction estates get finished. Interest rates are rising, houses are unaffordable, and sentiment has collapsed, which means demand will fall.

Massive oversupply + greatly reduced demand = large fall in price.

Which bit of this is failing to get through to the populace at large?
 
delboy159 said:
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.
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Can't blame anybody. Its akin to how a civil war breaks out (Iraq will be next) after every National Independence (be it forced or forced upon).

A housing bubble follows a economy recovery. And inevitably , it bursts.

C'est la vie !
 
Bedsit said:
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So why not give even more "dead money" away in interest to your bank?

Getting a mortgage IS RENTING money from the bank and each ECB rate rise means that your bank just puts the rent up.

Why don't people get this?
 
Bedsit said:
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Dear God.

€400,000 in debt for the next 30 years (and with repayments at €1900 a month, I'm betting that's an IO loan). Probably, at their age, about 8 times combined salary?

That's just insane. How could anybody be so stupid? What is wrong with everyone these days?
 


...is this magazine a pi#s take?
 

I loved the following quote in the article:

"When we came up the second time, there was a queue of about ten people, but luckily the seller recognized us from before and gave us preference"

I hope I am never the recipient of such preferential treatment
 
Bedsit said:
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They could have rented that exact same apartment for €1100 a month. No need to borrow from your parents, no need to put up €15k yourself, no property management fees and nearly an extra €10k in your back pocket.
 
CelloPoint said:
Living the "dream" eh? 2-bed flat in D15, traffic, tight belt and a property management company's bit%h. What a waste of youth.
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I don't disagree about the waste of youth comment, but RCP is not in D15, it's probably D7, it is at least close to town, so in my opinion it's not that bad a long term investment compared to, well, a property that's actually in D15!
 

I didn't read the full article to be honest (it would just make me sick), but that quote has made me snigger out loud!

My mate who bought a similar 2-bed in north dublin was harping on about a similar "special deal" which he got from his mate who works in PTSB (I'll bet he was on commission too).
 
I think the article is one to print off and review in a few months time.
 
CelloPoint said:
But sure as long as they're happy, isn't that all that matters? I'd say a market correction would soon wipe that stupid smirk off their (and their parents') faces.

Lol!
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It's really kind sentiment like that - at the expense of a young couple that are trying to set themselves up in life that tends to tarnish many of the logical arguements used by the bears.... we all know they look like they could be in a very dangerous place with house prices freezing (or falling) and IR going up, but takling pleasure in their potential problems isn't very becoming.

phoenix_n - I'm not saying that Bertie is to blame, I'm saying when he and his party members have to canvas for a general election in 8 months or so - a shakey or falling property market could ruin his election chances. I doubt the average Joe Voter will listen to "markets are cyclical and this is a natural and dare I say overdue correction that the market needs"....

Or Bertie could just do some dodgy stamp duty trick and get elected next May!!!!!
 
room305 said:
They could have rented that exact same apartment for €1100 a month. No need to borrow from your parents, no need to put up €15k yourself, no property management fees and nearly an extra €10k in your back pocket.
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And invest the €10k wisely adding to it each year with another 10K. On top of the 15k upfront + 5K on furnishing and say 5K and 15k? stamp duty.
 
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