Current public sentiment towards the housing market?

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Affordable housing scheme = political safety valve. The whole scheme is driven by a recognition that there will be problems ahead. Deserted, half-built complexes will be snapped up at bargain prices and sold on to a dumb electorate at discount prices. FF/PD politicians will herald the affordable housing scheme a huge success and claims that young professional people are being priced out of the market will be passed off as but an "opposition rant".

Anyone who thinks that affordable housing is a good investment is a greater fool (fool me once, shame on me, fool me twice etc.) These places are generally in the middle of nowhere (I'm thinking Northern Cross, Darndale) and are occupied by undesireables.

A crash will be just that, a crash, and certainly will not be due to a political masterpiece in providing cheap housing to young people (a political masterpiece in economic masochism perhaps).

Affordable housing is definitely a case of buying votes - feed the goldfish and they'll vote. On a fundamental note: why should anyone subsidise another perfectly healthy tax-payer capable of work? Affordable housing is despicable.
 
Apsil said:
I realise that prudence is key, but you have to take a risk on something or you're never going to make money on anything.
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Property generated wealth is generally empty. Currently, this country is generating a disproportionate amount of its growth from property/construction and selling none of it outside the country. Additionally, much of the remainder comes from multinationals who are at liberty to go and and improve economic growth in a number of other countries if they so wish.

In the long term, a country which is actually earning money from productive activity in some respect is better off economically than a country which has a lot of debt laden growth. The vast majority of people investing money in property are doing so not because you have to take a risk to make money but because "you can't lose on property". That's not a consideration of the risk involved.

The economy would be a lot healthier if people did actually look at possible risk/return and invest in companies which have ideas to sell or export, be it in the area of manufacturing or services or knowledge. I don't really care which. You can't, by definition, export houses. There are vast swathes of Lucan which you cannot sell to the fast growing Chinese economy.

We can't actually have continued economic growth merely from selling houses to each other.
 
Northern Cross is being built right on top of a Hilton Hotel and not all of it is being flogged as affordable housing. That being said, the list prices (full, not affordable) were, in my opinion, very high, even without respect to its proximity to Darndale, and with respect to its proximity to the coastal areas and M1/M50.

Affordable housing is not so much a good investment - unless you're convinced property will continue to grow indefinitely, which it won't. From a governmental point of view, it was not a courageous move either. A sensible move would have been to take the heat of the market before blew up. Unfortunately, that would have meant alienating a lot of people. There is no politician anywhere in the world, never mind Ireland, who is democratically elected, who would have the guts to do something which would directly cause a lot of people to lose a lot of money (on paper).
 
OilKing said:
So I guess a question that we must ask is by what % must Irish Property in Dublin be reduced so that its yeilds a similar 6%. Maybe then we will get an idea of how much property is over priced.
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Not too sure that this is an accurate gauge since yields can vary greatly. Investors in Ireland have shown that they are willing to forego yields and rely on capital gains alone. Parts of the Irish property market have a long way to drop (or rents a long way to rise) if it's ever to reach those 6% yields that you mentioned.

According to the latest daft report the average price paid for a house in Dublin was 483,000. The average price paid for rent in Dublin, from the same report, was 1,250 monthly (15,000 annualy). This represents a yield of 3.1% before taking all other expenses into account.

To get a 6% yield average, rent would have to rise to 2,400 per month or the average price of property would have to fall to 250,000 (a 48% drop).
 

You cant talk about worth and houses. A house is "worth" what it costs to rebuild it, which in most cases is far less than what someone will pay for it on the market. The apartment in manhatten isnt "worth" $640K no more than the one in D3. However, to someone who wants to live in ireland and doesnt want to live in manhatten that house in D3 maybe owrth 640K to them! The apt in manhatten isnt worth sh1t to them because they dont want it.
 
Two more asking price reductions I noticed...
this time in Foxrock and Dún Laoghaire

Foxrock
Original Price : €1,250,000


New listing, Reduced to €1,175,000
[broken link removed]=

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Dún Laoghaire - this one even gets a write up in the Irish Times
Original Price :€695,000 [broken link removed]

New listing, Reduced to €675,000
[broken link removed]=
 
CelloPoint said:
Anyone who thinks that affordable housing is a good investment is a greater fool
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Affordable housing is not supposed to be an investment.
 
Has anyone noticed that recent buyers are absolutely horrified that somebody might get a better deal than them?

If they stress tested their repayments and they made a "long term investment" then they shouldn't worry about rising interest rates and falling prices. They seem to resent that buyers might be able to purchase at lower prices than they did!
 

The value of that house in D3 is comprised of the replacement cost of the existing structure plus the price of the land on which it stands. The value of land is a factor of its productive capacity. For instance an acre of agricultural land in the Golden Vale has more value than an acre of stony land in the west of Ireland because it can produce more food. The same goes for urban land the higher the productive capacity the higher the value. The productivity of urban land is a factor of population density, infrastructural provision, quality of governance, land use planning policies, etc.
 
It's the fear of discovering that they came in at the top thus making them look silly which is probably the issue here.
 


Thanks Whathome, fascinating to have concrete evidence.
 

New Listing reduced to 1.25m from 1.3m. I don't know how to search the google cache? any help?
[broken link removed]
 

You all seem to be salivating at the thought of a property crash. Its palpable.

I presume none of you are home owners or else you bought more than 5 years ago.

whathome & calina I assure you the fear of "looking silly" is the last thing on the minds of people with families who have signed up their earnings for the next 35 years to a house which, if you are right, wont be worth what they paid for it.

There is a very distasteful element being brought into the debate. Can we stick to the topic which is how we think the market is going to go.
 

the topic is in fact current sentiment and fear of "looking silly" is a valid sentiment

EDIT : I think we all now how we think the market is going
 

This is known as the Winners Curse.

http://en.wikipedia.org/wiki/Winner's_curse
 
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