Current public sentiment towards the housing market?

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Germany has not and is not in a recession. It is a myth. Their GDP is based on engineering, manufacturing and exporting things of high value. US/UK is based on debt and consumption. Which do you think is stronger and more sustainable? In the last week, US GDP for the LAST 2 YRS has been revised down, while Germanys is being revised up. [See yesterdays Lex column in the FT]. The QUALITY of GDP matters as well as the QUANTITY. Go visit Germany, it blindingly obvious that the Germans are doing a lot of things right.

Finally, it matters very little to German consumers and manufacturers what interests are. They have no debt. We on the other hand are drowning in it, and live and die by the ECB.
 

And with that E50m they have ruined the integrity of the publication and will not be able to publish unbiased reports on what will be the biggest news story in 10 years. The paper is gone to hell and I wish them bad luck in their new generic glass-house on Tara Street. (slightly off topic) The current premises they occupy on D'Olier Street have charachter and are steeped in history. The move to an awful looking glass-fronted building just typifies what is happening at the Irish Times
 
Irish mortgages: Pain on the way

Here is a link to an old article from the Sunday Business Post. Below is an interesting snippet from the same.

"The sensitivity of Irish mortgage holders to rising interest rates will be far greater than for many other EU citizens because the vast majority of Irish borrowers - about 75 per cent - have variable mortgage rates, while the majority of continental borrowers - especially in France and Germany - have long-term fixed rate mortgages at rates that are far lower than the fixed-rate mortgages available here. In other eurozone countries, mortgages may be at variable rates, but they are capped ...

Last week, ten-year fixed rate mortgage deals in Ireland were priced at about 4.6 per cent. Generally speaking, Irish banks do not market longer-term fixed-rate mortgages, though Bank of Ireland said it offered a 20 year fixed-rate product at 5.2 per cent.

Our long-term fixed-rate mortgages are far dearer than in France, where, last week, you could get a 15-year fixed-rate mortgage at 3.25 per cent, a 20 year fixed-rate mortgage at 3.4 per cent or a 25-year fixed-rate mortgage at 3.55 per cent, according to the French website www.meilleurtaux.com, which analyses the best rates available on the market."

Need one say more!!
 
Germany may not be in recession, but it is in some difficulty. It has an unemployment figure of around 9 or 10%, though admitedly it is coming down slightly. It has a low birthrate and an aging population which is putting pressure on their health and pension budgets. It has breached one of the Maastricht criteria (something about current account defecit and 3% - never really understood it) three years running and may breach it again this year. It is suffering from political paralysis and this is unlikely to change soon as it's due to the structure of the Federal Republic, deliberatly so created after WW2 to prevent the rise of a strong centralist State. And there is a pretty negative vibe in the country regarding the economy and future prospects (not fun to live through, as we may discover in the next few years).

Having said all that, it is a stable economy and is growing at around 1.5 to 2%. Taxes may be high but you get good public services for your money and the general cost of living is lower than Ireland. Accomodation is not cheap, but is good quality. There are jobs in Germany, though it takes longer to find one due to the more formal nature of the recruitment process. Due to the demographics there, they expect skills shortages in certain areas in the near future.

Seeing as I speak the lingo, that would be one of my main options should the economy go belly up here and I lose my job as a result. It also has the advantage of being EU (no work permit required) and Eurozone.
 
House Prices Falling - its official!

The full Daft report is published here at:
http://www.daft.ie/report/DaftReport-Q22006.pdf

Now, I was impressed with Daft's frankness about the figures, but they don't present the full story - look at Page 2 of the report. There is a table...

Asking Prices, Residential Sales
Base: 2005 = 100 (includes preliminary figure for July)

2005 2006
January 89.0 104.7
February 95.1 108.3
March 96.9 109.3
April 97.1 110.5
May 98.3 107.8
June 100.4 106.6
July 100.3 105.4
August 99.7
September 103.0
October 104.7
November 106.5
December 109.0

(Sorry about the formatting - not easy!)

So just to explain the annual growth figures. They take the average price for 2005 and set that at 100 (i.e. could be €450k). So annual growth % is calculated by taking the normalised value in April 2006 at 110.5 and subtracting the value in April 2005 at 97.1 giving 13.4% growth in property price between April 2005 and April 2006.

Now - my headline would be! Current house prices have fallen constantly by 5.1% since April this year! (i.e. from 110.5% in April'06 to 105.4% in July'06 - this compares to a rise of 3.2% for the same period last year)

Frankly you can make any figure from the statistics above, but I would have thought that this would catch the public's attention!

In the report they use average quarterly figures. You don't have to be a genius to see that there is no way that they will be able to hide the drop in the Q3 figures given this downward trend!
 
Re: House Prices Falling - its official!

Del3D said:
Now - my headline would be! Current house prices have fallen constantly by 5.1% since April this year! (i.e. from 110.5% in April'06 to 105.4% in July'06 - this compares to a rise of 3.2% for the same period last year)
!
Click to expand...

They also fell from June to August inclusive last year, so is just a seasonal factor?
 
Re: House Prices Falling - its official!

Del3D said:
You don't have to be a genius to see that there is no way that they will be able to hide the drop in the Q3 figures given this downward trend!
Click to expand...

When house prices dropped in 2001 the announcements from BOI/PTSB/DNG etc suddenly switched from
"House prices jumped by XX% last month"
to "The annual rate of house price inflation slowed slightly last month"

Then when prices started to rise again in early 2002, the announcements went back to headline grabbing monthly figures.

Anything to avoid reporting a drop!
 
2Pack said:
Thats pretty much my advice with a smidge extra. Try to have 10% of the price handy when you do dip in.

Theres no point bustin yo' balls to buy onto that 'ladder' at the back of Ballivor , especially if you are a Dub Lifes too short.
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I already had a house but sold it,i'm aiming for a Ltv of 50-60% when i dip back in.
 
Personally I see the biggest drop (in Dublin) occurring in apartments - 000's of FTBs are buying these and will, after about 2 years, grow tired of maintenance bills & lack of space. This will lead to them chasing either houses in the city, if they have the funds, or joining the commuter belt. Given the number of new builds in commuter-ville, my money is on the 3-4 beds inside the M50.....
Firefly
 

I agree, appartment living gets tiresome very quickly with..
- Maintenance Bills
- Always using elevators and stairs
- Walking up and down to the car park
- Lack of space
- More possibilities of noisey neighbours

There is a lot to be said for semi-detached houses! Or detached ones if you have deeper pockets!
 

And the first to get hit are those ground floor apartments. Especially 1 bed.
 
The only properties effected by a downturn will be the ones in less desirable locations. The mad rush over the last couple of years to get on the ladder 'no matter where' will be hit the hardest.

EDIT:
Perhaps the use of the word 'only' is a bit misleading. Read - Majority.
 
A real actual conversation had today with a supposedly intelligent co-worker -

Q:My home has gone up by 40k, how do I apply to release equity from this to put as a deposit on a 2nd home,I want to become a property investor?
A: (from me) you re-mortgage your house for the 40k.
Q: so does that mean repayments on my own mortgage will go up???
A: yes, you are borrowing the 40k against your PPR, mortgage to increase accordingly.
Q: but I thought the bank would just give me the 40k seeing as I "earned" it?
A: so you are saying that the bank now "owes" you 40k out of the blue, as a windfall of sorts...is the irish property bubble fairy supposed to leave it under your pillow...

this woman thought the banks should deposit 40k into her account out of thin air as her house was now worth more. Give me strength!!! If this is the level of some wannabe-investors in the property market, I fear for their future....
 
well, at least she asked the questions and no longer lives under that misconception - it'll probably make her reconsider becoming an investor too.
 

Or maybe the word is 'initial' - those properties prop up the rest of the market!
 
Persius said:
Accomodation (in Germany) is not cheap, but is good quality.
Click to expand...

I agree your analysis other than the above.

It depends where you are renting or buying.

Munich and Hamburg are most expensive, but I don´t think they would be significantly dearer than Dublin.

But much of the country would be less expensive, especially the former east, where there are something like a half million empty apartments.

In cash terms, I would say most of the country would be less expensive than Dublin (to rent at least), but because taxes are higher people don´t have as much disposable income anyway.
 
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