Current public sentiment towards the housing market?

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walk2dewater said:
What?

Buyers waiting?

For heavens sake why? Sure isnt rent "dead money". Surely since "in the long-term prices always go up" the current "soft landing" is merely "a buying opportunity".
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And there people are wondering why no "bulls" are contributing to this thread's currently very onesided "discussion". I'm surprised you didn't find a way to throw in the "it's a new paradigm" phrase as well.

Having said that. I'm not a bull in the sense that I believe that the house market will continue on like it has in the past years. I merely believe that things aren't going to be nearly as bad as the majority of people on this thread thinks.

The Eurozone inflation is obviously a big factor for which direction that house prices will go. Factor that in with the possibility of a change to the stamp duty in the next budget and I think we might see house prices increase some more in the first half of next year.
 
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Slicknik said:
German inflation at two and a half year low
http://www.rte.ie/business/2006/1012/germany.html?rss

Looks like inflation in the Eurozone in general is going in the right direction. If inflation continue to go down or stays level there shouldn't be a need for ECB to raise the rates much further.

I think a lot of people (FTB's in particular) currently are waiting to see how high the interest rates are going before deciding whether to buy or not. If ECB have good news at the next meeting there might be another stream of buyers coming onboard in the new year.
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If German inflation continues to fall say to 1% or less is this good. They've had falling inflation for many years, caused by rising unemployment and stagnant wage growth. This caused property prices to fall. I'd wager that the ECB would rather be tackling 3% inflation in Germany rather than deflation. The laughable thing is that signs that the German economy is slowing would be meet with glee in Ireland.
 
Slicknik said:
German inflation at two and a half year low
http://www.rte.ie/business/2006/1012/germany.html?rss

Looks like inflation in the Eurozone in general is going in the right direction. If inflation continue to go down or stays level there shouldn't be a need for ECB to raise the rates much further.

I think a lot of people (FTB's in particular) currently are waiting to see how high the interest rates are going before deciding whether to buy or not. If ECB have good news at the next meeting there might be another stream of buyers coming onboard in the new year.
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The Euro has weakend ~3% against the dollar since August, that is not good for inflation, Oil priced in dollars being an obvious example.
 
Slicknik said:
I think a lot of people (FTB's in particular) currently are waiting to see how high the interest rates are going before deciding whether to buy or not. If ECB have good news at the next meeting there might be another stream of buyers coming onboard in the new year.
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I think a lot of people (FTB's in particular) are simply priced out of the market, FULL STOP. Take a 1 bedroom apartment in Dublin, compare it to a classy one bedroom apartment in Berlin, there is no value in Ireland

Berlin - €86,000
http://tinyurl.com/pu7hg

Dublin - €370,000
http://tinyurl.com/rq7le
 
I know that this is a dirty word but is deflation back on the agenda. I still think that the Japanese debt and asset bubble and ('lost decade') bust is the road we are on I'm afraid.
 
Slicknik said:
From same article:
"For next year, I think that any speculation about our monetary-policy stance is absolutely premature"

Sounds like there's at least a chance that the quarter increase in December could be it for a while.
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But if inflation in Germany fell to say 0.5% would this be good for Ireland?

Incidentally the bond market is up. If OPEC cut production we are back to square one on the is it isn't it inflation debate it seems.
http://www.bloomberg.com/markets/rates/germany.html
 
Slicknik said:
And there people are wondering why no "bulls" are contributing to this thread's currently very onesided "discussion". I'm surprised you didn't find a way to throw in the "it's a new paradigm" phrase as well. .
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Prices have permanently re-adjusted upwards as "it's a new paradigm" :)
I've almost stopped posting here cos of the lack of coherent bull arguments. But please, feel free.

Slicknik said:
I merely believe that things aren't going to be nearly as bad as the majority of people on this thread thinks. .
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I agree. There's going to a lot of disappointed uber-bears. Particularly when mortgage rates stop going up or even start DROPPING, like what's happening in the US.

Slicknik said:
The Eurozone inflation is obviously a big factor for which direction that house prices will go. Factor that in with the possibility of a change to the stamp duty in the next budget and I think we might see house prices increase some more in the first half of next year.
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For the life of me I don't understand why people just don't read the ECB website. It's really not that intimidating. Current HICP figure is at least the 3rd, probably 4th most important factor Trichet looks at. Guess what the number one is? The M3 rate, which is basically credit expansion. And guess what M3 is doing right now?
 
Duplex said:
But if inflation in Germany fell to say 0.5% would this be good for Ireland?
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I don't think it'd be good for anyone in the Eurozone. But it increases the possibility of ECB capping their interest rate hikes fairly soon to prevent Germany from going in to deflation.
 
Slicknik said:
I don't think it'd be good for anyone in the Eurozone. But it increases the possibility of ECB capping their interest rate hikes fairly soon to prevent Germany from going in to deflation.
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But the BOJ have negative rates in Japan to no effect. I'm sorry but this argument that slowing growth is good for Ireland (because it keeps rates down and allows people service record debt) is flawed.

BTW good on you for having the guts to come and put your point.
 
Duplex said:
I know that this is a dirty word but is deflation back on the agenda. I still think that the Japanese debt and asset bubble and ('lost decade') bust is the road we are on I'm afraid.
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I wouldn't rule it out. Very tough time to make investment decisions of any kind - will we see deflation or continued inflation? I'm betting on inflation but will be hedging my bets by keeping some cash reserves.

Either way, I'd prefer not to have a 35 year mortgage debt hanging around my neck.

Went sale agreed on my PPR today. Let's just hope they close!
 
Duplex said:
But the BOJ have negative rates in Japan to no effect. I'm sorry but this argument that slowing growth is good for Ireland (because it keeps rates down and allows people service record debt) is flawed.
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I don't believe that slowing growth is good for Ireland.

But as long as inflation is under control it should allow ECB to keep a low interest rate to stimulate growth.

Central Bank issues positive assessment for months ahead
[broken link removed]

"In its latest quarterly bulletin today, the bank is predicting a growth rate of 5.5% for 2006 and says unemployment should continue at its all-time low of around 4%."

"Elsewhere, the Central Bank is expressing continued concern over high house prices, saying affordability is becoming an increasingly pressing issue.

It also says, however, that there are signs of a slight easing in prices that will reduce the risk of a potential property crash."

Again, I'm not a house price bull. I just don't feel that the picture is as bad as some people on this thread paints it. A 40% drop in the house market has been mentioned by this Christmas. I just can't see that happening.
 
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"Went sale agreed on my PPR today. Let's just hope they close!" Room 305

best of luck with it R305 - in the same position myself - anxious time eh?!?!
 
Duplex said:
If German inflation continues to fall say to 1% or less is this good. They've had falling inflation for many years, caused by rising unemployment and stagnant wage growth. This caused property prices to fall. I'd wager that the ECB would rather be tackling 3% inflation in Germany rather than deflation. The laughable thing is that signs that the German economy is slowing would be meet with glee in Ireland.
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VAT is going up 3% in Germany on 1st January however, and this will surely have a knock on effect on consumer prices, so a 1% rate of inflation is very unlikely.
 
dontaskme said:
VAT is going up 3% in Germany on 1st January however, and this will surely have a knock on effect on consumer prices, so a 1% rate of inflation is very unlikely.
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I agree, for now. The point is that we are between a rock and a hard place. The worst case scenario for Ireland is deflation taking a grip in the US and Europe. The Fed will inflate like mad to avoid this; the risk is that they may overshoot leading to hyper inflation and mayhem. So be careful what you wish for.


As far as the Irish property market is concerned not one iota of the risk is priced in not a penny cent, as will become evident in time.

BTW good luck Room 305.
 
phoenix_n said:
Did you get the asking price ?
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€1k above and for that we had to throw in (quite literally) everything. I guess we're lucky they really liked the house. Most of the other places on the market in the area aren't shifting - with the possible exception of the 3-bed ex-council houses. Although mostly this is down to the "well the house down the street sold for x, so ours must be worth x + 10% now" phenomenon.

I don't see any major slide in prices until next year but in a weakening market there is little advantage to holding out for another few k.
 
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