House Market Weakening?

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a builder has built a few fancy high design new builds close to my home (look like boxes to me)funny thing is he is auctioning them off one by one ,i've never heard of small new build being auctioned off before ,if a builder doesnt know how much his houses will sell for then things are defo crazy. on saturday there were crowds of people queueing to view this shoebox with an AMV of 650k for 2bed with no front garden and small back garden ,the three propertie have been built in the back of a neighbours back garden which handily backs onto a road.
 
hopefully someday sanity will return. We all know that Dublin prices have been in silly season for far too many years. Galway maybe too and lately Meath/Wicklow/Kildare. unfortunately its like a spreading disease and has now reached even darkest Dundalk. It's now reached the stage around here that if you see a house you like/want but would like a day or two to think it over- forget it. it will be gone. regardless of price. new estates starting in town with prices starting at €300,000+ for basic two bed apartments up to €400,000 for 4 beds and over €500,000 for five beds. small gardens, small bedrooms, timber frame etc. Sold out off plan as soon as the first sods are turned. M1 probably partially to blame. Dublin/Drogheda prices partially to blame. frenzy to get in early definitely a factor in crazy prices.
 
Glenbhoy said:
I know someone who bought at auction in the past month, the guide was 850K, withdrawn at 970K, the vendor said they were'nt prepared to let it go below 1.1m, after a an hour they sold for 985k.
With regards to the top end of the market going first, I remember a bank manager telling me 3 years ago that the top end was very sluggish and that prices were at best static. I would have thought it would be the bottom of the market where the market would fall first, this the next level up to be starved of buyers and so on.....
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A couple of things: 1) 985K is probably mid-market these days. However if what you have described is typical of the top end it would indicate to me that the market isn't turning yet.
2) Who is going to know first that the market is turning (and hence react first) - the wealthy builder buying his 10m residence in ballbridge or the FTB buying his 400K property from that builder.
3) 3-4 years ago the market probably was in the process of turning and then got some new boosts.
4) While the behavour of the top turning first may be the typical behavour at the end of a property boom - I couldn't say that that is what always happens. It may vary depending on the particular dynamics of a given market. (I don't have the study to hand). Prehaps if the whole country is in a state of denial then it will be the FTB who quits the market first purely from lack of finance.
 
I must remind myself what the US property market was like again, I going to get out "Glengary Glenross" and watch it again.
 
yygaurav said:
if it can happen in US it will surely happen here.

http://www.businessweek.com/ap/financialnews/D8I6RL4O0.htm?sub=apn_home_down&chan=db
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Listening to the reporter from the SBP on Newstalk this morning it seemed that there was finally someone in the media who was able to offer a sanguine look at the property market. The point made by him that after the next 25bp rise (speculation of 31 Aug) a couple on 76,000 would only qualify for €100k less of a mortage than in the corresponding period last year was very pertinent.

I am sure that there will be some property bull who will be able to show us that everything is rosy in the garden pretty soon.......;)
 
redo said:
I must remind myself what the US property market was like again, I going to get out "Glengary Glenross" and watch it again.
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Yes that it a very good idea though I can't see anyone over here being as slick as Pacino. I would buy an apartment in Dublin from him :D
 
beattie said:
Yes that it a very good idea though I can't see anyone over here being as slick as Pacino. I would buy an apartment in Dublin from him :D
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Even in up and comming Jobstown (Quote from I'm an adult, get me out of here)
 
To me rising house prices indicate nothing but easy credit. There's a wonderful interaction between estate agents and banks. Estate agents can continue to raise asking prices in the safe knowledge that banks are accelerating debt into the economy. On it goes year after year as Irish house price growth challenges world records as does the driving growth in debt.

On the other hand, look at shares of financial institutions on the ISEQ. They are undergoing a severe correction (a crash even by some
definitions).

This dose of reality is an indication of what domestic and international investors think of the hollow game of accelerating-debt/accelerating-houseprices
in the face of rising interest rates.

If the Irish housing market were truly different in terms of growth potential, demographics, shortages etc. etc. you would see the Irish financial sector surge while others falter. Instead it's plunging - this is not consistent with the belief in a robust and unstoppable housing market.

(p.s The ISEQ weights each listed company and the 4 big financials comprise about 45% of the value of the ISEQ)
 
conor_mc said:
I'm leaning towards the latter, especially in light of AIB's and BOI's recent sale-and-leasebacks. Be interested to hear some other points of view....
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don't forget myhome.ie going on sale as well!
 
madisona said:
Does anybody have any idea where this figure has come from?
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The guy quoted in teh article got back to me, it is from John Fitzgerald, "The Irish Housing Stock : Growth in Number of Vacant Dwellings" in Quarterly Economic Commentary, ESRI, Dublin, Spring 2005.


you can download it
 
so it's a very credibly source then ???? he didn't happen to mention how they actually compiled those figues by any chance?
 
miju said:
so it's a very credibly source then ???? he didn't happen to mention how they actually compiled those figues by any chance?
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yep, the report he took it from tells.

"The data used in this article include unpublished data from the
1991, 1996 and the 2002 Census on the stock of dwellings, the
Department of the Environment data on housing completions, and
ESB data on the number of household electricity connections."

you can read the whole thing in the report, its a free download.
 
Those data are very out of date - it comes from 2002-2003 and there have been 200,000 homes built since then with approx 30-40% bought by investors. How many of these are empty?
 
shall we say 160k empty units, not counting holiday homes or a full 2 years output :D . Call it an educated guess based on extrapolating the figures .
 
if i'm not mistaken from reading the figures in that report , it only works out at approx 37,000 vacant homes (when holiday homes / temp vacted homes) are stripped out

still a serious overhang , but would be interesting to see if this figure for unoccupancy has risen or fallen (i'm guessing risen drastically)
 
Its 170k empty (in 2002 ) - Holiday Homes and - Temps = 104 k properties empty not counting Holiday Homes and Temps.

I'll wager the same firgure today is 2 years worth of building lying idle and not used as holiday homes or temporarily empty. eg 170k not 104k . Thats a big overhang if there is a panic in the market and the investors dump out.
 
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