Current public sentiment towards the housing market?

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Dusty said:
My point was that in those two years that you have been waiting for the long promised collapse in house prices they have risen significantly and are continuing to do so. Do you really think they will drop back that far to make your wait worth while or would you have been better off buying two years ago?!
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For me, an emphatic Yes (Edit - in answer to prices dropping back). I can't see any logical reason why the house I bought two years should be worth almost 50% more than what I paid for it. Can you?
 
howstrange said:
I totally agree with you. If I was buying a home that I was happy to stay in for a long time then price crashes are irrelevant.
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So, you'd have no problem paying a mortgage that's more than the value of your property?
 
Until I see a photograph of a substantial amount of 'for sale' signs outside some generic apartment complex/housing estate, I will hold off on saying stuff like 'the crash has begun'. I'm still a definite bear though.

Mind you, estate agents might opt to sell housing units via the internet in the event of a mass sell-off in an attempt to avoid the visual deterrent of lots of 'for sale' signs on display.

So has anyone got any decent photographs they can post on AAM? I'll keep my eyes open too, but I don't live in West Dublin...
 
Dusty said:
If you are buying a home (as opposed to an investment) it really doesn't matter as it will iron itself out in the long run (10-20 years)
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If for arguments sake you buy now 300,000 @ 4% you will have annual repayments of roughly 17000 for 30 years.
if they drop by just 10% and you still paid the same repayments you would finish paying 5 years (and 90,000) earlier

Dusty said:
and we'll all look back and reminisce on how cheap houses where in 2006!
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Like the Japanese look longingly back at the 90's
 
ivuernis said:
So, you'd have no problem paying a mortgage that's more than the value of your property?
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Of course Id have a problem with it! But at least if you live in a place you are happy in you have some consolation. What about the many that are living in some puny place in a place they hate living paying back a huge mortgage in a place nobody wants to buy, then it would be a major problem!!
 
howstrange said:
Of course Id have a problem with it! But at least if you live in a place you are happy in you have some consolation. What about the many that are living in some puny place in a place they hate living paying back a huge mortgage in a place nobody wants to buy, then it would be a major problem!!
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The concern of a lot of people here is that there is a major chance that this will happen.
 
StoppedClock said:
If for arguments sake you buy now 300,000 @ 4% you will have annual repayments of roughly 17000 for 30 years.
if they drop by just 10% and you still paid the same repayments you would finish paying 5 years (and 90,000) earlier

What do you mean by the above statement? Do you mean if prices dropped? If prices dropped you'd still be paying the same mortgage over the same timeframe.
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conor_mc said:
For me, an emphatic Yes (Edit - in answer to prices dropping back). I can't see any logical reason why the house I bought two years should be worth almost 50% more than what I paid for it. Can you?
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No I can't. However neither do I think that you will see a 50% drop in the price of your house. If\when house prices drop they don't tend to drop that far, people would rather stay put than sell their house at a sustantial amount less than they percieve it to be worth. Only those who are forced to move will do so, most will wait for prices to pick up (much like those now waiting for the bubble to burst!)

If you're honest you wouldn't sell your house now for what you bought it for two years ago? (If you will give me a call ;)) you might knock of 10 or 20% if the market slows but any more, I doubt it...
 
Contrarian said:
StoppedClock said:
If for arguments sake you buy now 300,000 @ 4% you will have annual repayments of roughly 17000 for 30 years.
if they drop by just 10% and you still paid the same repayments you would finish paying 5 years (and 90,000) earlier

What do you mean by the above statement? Do you mean if prices dropped? If prices dropped you'd still be paying the same mortgage over the same timeframe.
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StoppedClock means that if the value of that house fell by just 10%, ie, you buy the property at 270K instead of 300K, but paid back at the rate that someone who paid 300K, you would pay 90K less and be done with the mortgage in 25 years instead of 30.

Of course, this presupposes no change in interest rates, and that's not guaranteed. But the point is a 30K drop in house purchase price is not just 30K less in what you spend, it's nearer 90K according to him. I haven't done the maths, but I suspect he's not far off with the figures.
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StoppedClock said:
If for arguments sake you buy now 300,000 @ 4% you will have annual repayments of roughly 17000 for 30 years.
if they drop by just 10% and you still paid the same repayments you would finish paying 5 years (and 90,000) earlier
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If, If.....

What if by the time they drop 10% prices have gone up another 20%?

no-one knows what will happen in this crazy market.
 
Thanx for clarifying that, when you look at it that way the importance of buying at the right price becomes even more important due to the interest savings etc
 
Dusty said:
No I can't. However neither do I think that you will see a 50% drop in the price of your house. If\when house prices drop they don't tend to drop that far, people would rather stay put than sell their house at a sustantial amount less than they percieve it to be worth. Only those who are forced to move will do so, most will wait for prices to pick up (much like those now waiting for the bubble to burst!)

If you're honest you wouldn't sell your house now for what you bought it for two years ago? (If you will give me a call ;)) you might knock of 10 or 20% if the market slows but any more, I doubt it...
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What they perceive it to be worth will not matter. Try that with your EA and they will say the same. Its what someone is prepared to buy it for. If they dont want to sell at what the market dictates the price to be then they can very well choose not to sell. Dont forget also that people can sell below what they paid for it if they had gained sufficiently equity in prior sales.

You must remember that houses were bought/sold like shares (not all but recent sales) and as such can fall in value when the perceived growth is not realised.

Dusty said:
If, If.....

What if by the time they drop 10% prices have gone up another 20%?

no-one knows what will happen in this crazy market.
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And thats the point. Its a crazy market. Its risky
 
homeowner said:
It seems to me that the people who are predicting doom and gloom here have a vested interest in the market crashing.
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just to pick up on a quick point here , but would these people not be the current / future housebuyers in this economy of ours? in which case does it not give you a clear indication of what way sentiment is heading?
 
Dusty said:
No I can't. However neither do I think that you will see a 50% drop in the price of your house. If\when house prices drop they don't tend to drop that far, people would rather stay put than sell their house at a sustantial amount less than they percieve it to be worth. Only those who are forced to move will do so, most will wait for prices to pick up (much like those now waiting for the bubble to burst!)

If you're honest you wouldn't sell your house now for what you bought it for two years ago? (If you will give me a call ;)) you might knock of 10 or 20% if the market slows but any more, I doubt it...
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What about the many joe soaps who have bought a 1 od 2 bed apt as an investment waiting for the capital appreciation and the cash to start rolling in? How many of these will start to panic when they see prices starting to fall? Will they have the nerve to hold out while they are up to the gills paying 2 mortgages and interest rates all the while increasing?
 
Dusty said:
No I can't. However neither do I think that you will see a 50% drop in the price of your house. If\when house prices drop they don't tend to drop that far, people would rather stay put than sell their house at a sustantial amount less than they percieve it to be worth. Only those who are forced to move will do so, most will wait for prices to pick up (much like those now waiting for the bubble to burst!)

If you're honest you wouldn't sell your house now for what you bought it for two years ago? (If you will give me a call ;)) you might knock of 10 or 20% if the market slows but any more, I doubt it...
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People that live in their own house may be reluctant to sell but the speculators will exit at the drop of a hat. Remember that up to 40% of new build is bought by 'canny investors'.
 
Contrarian said:
People that live in their own house may be reluctant to sell but the speculators will exit at the drop of a hat. Remember that up to 40% of new build is bought by 'canny investors'.
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Agree 100%. I've seen talk on this thread of people holding on to their properties because of the psychology of selling below what you paid for it - reasoning like "i'm in it for the long term" etc.

Investment properties are indeed a different kettle of fish, and whilst PPRs are sticky on the way down, investment properties certainly will "exit at the drop of a hat".

Given the amount of investment property out there (thanks to section 23), the outlook can only point to one direction.
 
miju said:
just to pick up on a quick point here , but would these people not be the current / future housebuyers in this economy of ours? in which case does it not give you a clear indication of what way sentiment is heading?
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Yes but you/those people are only one part of the future home buying sector. The rest will be made up of apartment and small house owners looking to upgrade, older people looking to downgrade, immigrants and of course new college grads coming along or new ftbs. Your opinions are valid, but you dont reflect the whole market and your buying power is less than those who have already bought and will upgrade/downgrade.

I forgot to mention investors! (how could I forget the investors :))
 
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