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walk2dewater
Guest
rgfuller said:
Correct.
But does it matter whether you own a house if you've got several million in say, Canadian or Swiss bonds?
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Correct.
But does it matter whether you own a house if you've got several million in say, Canadian or Swiss bonds?
gearoidmm said:
I've often wondered about the lag.
The ESRI/PTSB report is based on mortgages drawn down when final contracts are signed. This means that there is approx 10 week lag on sale agreed prices. Add another month for report preparation and you have data that is three to four months old at the time of release.
We all know the market was crazy in March which is when figures in the latest report would represent sale agreed prices - but it has since slowed considerably.
Much of the Bank of Ireland quarterly property review is based on ESRI/PTSB and Department of Environment figures which would explain why it also lags the real market. The DoE index is also based on loans paid, and involves a time lag from when contracts are signed.
As the daft report is based on asking prices, it is more representative of sentiment in my view.
The main difference between generation X & Y is that X were lucky to see very low house prices.I'm a generation X and bought my house in 93 price 50k punt(5 bedroom house in Dundalk)
Generation Y have no interest in house buying(there only interested in lifestyle and instant hits)
Generation X at same age were more prudent(savers) and had longer term goals.
That was the conclusion of the study in Australia
Maybe Ireland is different?
Generation Y have no interest in house buying(there only interested in lifestyle and instant hits)
Generation X at same age were more prudent(savers) and had longer term goals.
That was the conclusion of the study in Australia
Maybe Ireland is different?
On paying rent when your in old age-why would u live in poverty.
78% of German households rent and we don't hear scare stories about these pensioners living in poverty.
As well if u put the savings from renting over paying a mortgage,u should have a very nice nest egg when u reach retirement age.
I'm currently putting $30k pre tax into my pension pa-this will leave me with a very nice nest egg at 60 where I will have the option of buying house outright(or getting an indexed linked pension which I plan to do)
Theres' so much fear out there of missing out on the property ladder,reminds me of the dot com bubble
78% of German households rent and we don't hear scare stories about these pensioners living in poverty.
As well if u put the savings from renting over paying a mortgage,u should have a very nice nest egg when u reach retirement age.
I'm currently putting $30k pre tax into my pension pa-this will leave me with a very nice nest egg at 60 where I will have the option of buying house outright(or getting an indexed linked pension which I plan to do)
Theres' so much fear out there of missing out on the property ladder,reminds me of the dot com bubble
P
phoenix_n
Guest
macbri said:
The effect of the housing boom in Ireland is that people are more impressed by someone who owns a couple of investment properties and surfed the property boom rather than somone who spent a year in a 3rd world country helping the poor. I believe Gen Y will realise which is more important.
Howitzer said:
Correct me if I'm wrong, but isn't inflation at the moment being caused primarily by rising energy costs, rather than consumer demand (europe wide, not Ireland!), which feeds into the price of goods.
By increasing interest rates, does this not also cause inflationary pressures as the cost of borrowings increase (for business and consumers), which also feeds into the price of goods?
Surely the increases in energy pricing should act as a measure in itself to temper consumer demands. It sounds to me by increasing interest rates will only serve to fuel costs, thereby increasing inflation??
T
thewatcher
Guest
The whine line now on rte1 radio,the housing market being discussed
The idea of interest rates increase is that it reduces consumer spending power,hence reducing demand and by default reducing prices(price is determined by demand and supply,if supply is constant and demand is reduced then in theory price should be reduced)
Generally if firms have higher input costs(fuel,heat etc) they will need to reduce labour to remain competitive-consumer will not pay higher costs due to less spending power re rise in interest rates
Thats' the theory but it will be interesting to see what happens in the future.
Generally if firms have higher input costs(fuel,heat etc) they will need to reduce labour to remain competitive-consumer will not pay higher costs due to less spending power re rise in interest rates
Thats' the theory but it will be interesting to see what happens in the future.
CelloPoint
Registered User
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macbri said:
Many young Irish people are living in complete fantasy land. They have never known bad economic times, let alone prudent economic times. The sooner this whole consumerist 'lifestyle choice' culture of fancy clothes, fancy car, latest nightclub, plasma TV, credit card, load consolidation wears off the better. The whole 'keeping up with the Smurfits' mentality is absolutely insane. Just take a trip to Dundrum/Liffey Valley/Newbridge shopping centres and you'll see what I'm talking about - I'd say half the people there are buying into a fantasy-land based on borrowed money and equity release.
Mind you some wealthy people do like to splash out on the latest consumer goods which is fair enough (despite the bad taste), but the indebted generics who queue up to hand over their meagre salaries to Visa or MasterCard are just downright pityful.
People will only learn the hard way that in order to build a sustainable and social-friendly economy, there must be conservative governence, prudent economic planning, responsible citizens who save regularly and a willingness to work hard at something they really believe in so as to stand shoulder to shoulder with our international counterparts rather than rely on their low-cost credit and foreign investment.
Price didn't drop exactly, the rate of growth just tailed off in 2001 to about 4% from the prev year's growth of 20%.whathome said:
Also, the rates in 2001 didn't start dropping until May of that year and considering they had risen from 3% at the start of 2000 to 4.75% by the end of 2000 the drop in growth in 2001 could be seen as a delayed reaction to those rate rises.
The size of the money supply is important as well, if demand/supply from consumer was the only issue then there would be no fear of stagflation. Money supply has exploded in Ireland due to cheap credit. In fact money supply is rising faster than even house prices. This money has to find a home, hence it pushes up the price of goods and services.macbri said:
Increasing the cost of borrowing slows the growth of money supply but it is questionable if it can do it fast enough and suck up enough of the existing money in circulation to really combat inflation. To do so might tip the Eurozone economy into a recession. Worse still inflation may still be rampant. Hello, stagflation.
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phoenix_n
Guest
thewatcher said:
Is the sentiment bullish or bearish.
Someone could phone in and mention this thread. That'd surely get it to hit the 100,000 mark.
ivuernis said:
House prices dropped for sure in 2001 for several months running:
Feb 2002: http://www.rte.ie/business/2002/0207/houses.html
Clearly shows a drop in December 2001.
Edit: Well not so clearly as the truth was hidden by the misleading headline!
G
Guest107
Guest
Yes but Germany France and Italy (for whom the ECB rates are set not for us) were in recession then, thats why rates were coming down EVEN before 911 when the emergency 2% rate kicked in.ivuernis said:
The emergency post 911 rate stabilised those economies but caused some peripheral ECB zone economies like Ireland and Spain to go spastic ....for want of a better description...as they were slooshed by a wave of cheap money which overinflated their housing markets .
A rate cut cycle is some way off at present and a prudent person would have to plan for a plateau of 6% mortgage rates meaning base around 5% Base is 3% from today.
Ultimately I belive that the gen X er who bought a house in the 1990s and had a repayment mortgage will not go negative , thast assuming they have not entered the rental market post 911 as well.
As for the Y type interest only 40 year mortgage type person out the Back of Ballivor......God help the poor fools
ivuernis said:
Housing Loan Approvals (CSO)
2000 80,858
2001 69,062
2002 93,136
2003 97,888
2004 104,305
2005 120,637
The 2001 'reversal' in the market has to be seen in the context of lower house prices relative to incomes, lower private sector consumer debt, higher rental yields (in 2001) and 300,000 fewer homes than presently exist. The ECB will not be cutting interest rates in the foreseeable future.
O
OilKing
Guest
Howitzer said:
Both of you are wrong.
A rise from 3.5% - 4.75% is a relative increase of 35.7%.
An interest rate rise from 2% - 3% is a relative increase of 50%, not 33%.
Duplex said:
Since there were 86,000 or so new properties built in 2005, would that mean that the size of the second hand market in Ireland was only about 34,000 units in 2005?
Surely that can't be right?
Claims from some real estate agents about 40% of new builds being bought by investors would suggest that around 35,000 units were bought by them in the same period. If all of those investors dumped their properties on the market it would effectively double the supply of second hand homes!
Someone tell me I'm wrong here, please.
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