Is the bust already under way ?

Re: house prices

Besides, it's my belief that house prices always have and always will be expensive in this country - relative to peoples incomes and interest rates.

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This certainly wasn't true in the 80s when many people found that they couldnt sell property for love nor money, even to the extent that large parts of Dublin, Galway etc lay derelict and the well-off sectors of society piled their money into bank savings for fear of losing all in property.

Re: house prices

Yes, but were the interest rates not in double digits making property expensive regardless of cost?
High mortgage rates would have also meant excellent returns on savings, compared to now at least, so saving was a better investment than buying houses?

Re: house prices

Yes, but don't those facts counteract your previous point that house prices have always been expensive relative to interest rates and incomes?

Someone I know bought a nice house in South Dublin for £30,000 in 1988. That person (a young professional) was earning £20,000 pa at the time. They paid 1.5 times their salary for their house - a bargain in anyone's book. (Nowadays you would need to be earning at least €300,000 pa to be able to afford to buy this house on similar terms.)

ps Interest rates on savings were higher in those days than now - but remember also that even then the returns on deposits were not particularly attractive because of the effects of inflation. Any Irish people who invested sums on long-term deposit 10 or 15 years ago have actually experienced very poor returns once inflation is taken into account.

You won't find too many people in Ireland who became rich from interest earned on savings. A lot of people have (even unwittingly) become rich in Ireland through owning property - the reason: they bought property cheap and sold when it became expensive.

Re: house prices

I think you have to decide whether you are buying a house or a home. If you are buying a home, then prices are almost irrelevant once you can pay the mortgage.