should i buy now

[charliemacck]

It amazes me that the estate agents in the thread seem to think that those who say they are not completely objective about the property market are whackos or conspiracy theorists or just bad people. I'm sorry, but it's just pointing out human nature, not implying they are evil(tm).

An estate agent can be no more objective about selling property than a butcher can be about selling meat. Noone expects to go into a butchers to get honest objective advice about the health implications of eating meat, or to be told "well, I probably shouldn't sell you this, I notice you've been eating beef more than three times a week". For a butcher, It's Always The Right time To Buy Meat.

 

[NorthDrum]

Apart from some trolling, is that not what the general consensus was on the thread anyway?

How much is the house you want worth? As much as you're willing to pay!

It is pretty much what most people believe. Difficult to really know what way the markets will go, but at the end of the day any financial decision made is based on personal and financial criteria for each individual.

 

[MrMan]

pure comedy gold MrMan

[broken link removed]

Yourself and Charlie are too generous with your remarks they really do make for informed adult debate.

As for the Sherry's poll, it is what it is, a poll generated by a property firm, I can't say if the findings are correct or not as I don't know the sample size or demographic used, do you? When I say that agents that I know believe its best to be open about the state of things I stand by that. There is no hiding place and if anyone wants to come out the other side of this recession with a reputation in tact then they need to react to the change in the market.
If you go to a car dealer they will tell you that the market is dead so you will get the car at a good price. They wont say that the market is picking up etc cause you could open up any daily paper and say 'wrong'.

EA's are in the business of sales but to make sales you have to realise where the power is and its with the buyer.

 

[MrMan]

It amazes me that the estate agents in the thread seem to think that those who say they are not completely objective about the property market are whackos or conspiracy theorists or just bad people. I'm sorry, but it's just pointing out human nature, not implying they are evil(tm).

An estate agent can be no more objective about selling property than a butcher can be about selling meat. Noone expects to go into a butchers to get honest objective advice about the health implications of eating meat, or to be told "well, I probably shouldn't sell you this, I notice you've been eating beef more than three times a week". For a butcher, It's Always The Right time To Buy Meat.

I would feel as a home owner and someone who has dealt in the business that I can see both sides of the story. I feel also that questioning someones credibility purely on grounds of employment makes no sense. If I displayed blind optimism and did not leave myself open to the notion that things could be very bad for a long time then you could say I wasn't being objective. I am more than willing to listen to reasoned responses because I believe you learn more from being wrong then right.
I also don't believe that all of those that post about the continued drops they predict are open to the possibility that they are wrong, not wackos simply tunnel visioned.

 

[charliemacck]

I feel also that questioning someones credibility purely on grounds of employment makes no sense.

So, in a discussion on the health implications of eating meat, the fact that someone is a butcher has no bearing?

 

[Askar]

So, in a discussion on the health implications of eating meat, the fact that someone is a butcher has no bearing?

No. The estate agent, conveyancing lawyer and mortgage brokers consider such accusations of conflict of interest as trolling.

I think one can only answer the OP by considering the following:
1. Most people move within 7 years of first purchase;
2. Few if anyone buys their 'dream' home;
3. The current economic climate and its impact on the property market; and
4. significant risk of negative equity.

As a hypothetical buyer in the market you will likely want to move again at some stage. You do not want to be in negative equity as this will be a noose around your neck in the current uncertain economic times we live in. It would also reduce you mobility if their is a pick up in another country and you wish to emigrate (or even relocate within the jurisdiction). There was a figure of 160,000 negative equity mortgage holders mentioned in the papers some time ago. This may well have increased.

If you find your 'dream' home you need to ask yourself what is the likelihood that its value will decrease in the next 12 months. Daft report illustrates extent of massive oversupply (there was a 5% reduction in oversupply but this could be explained as people simply giving up on trying to sell their property, which many have) and continuing reduction in asking prices. With mortgages getting scarcer and unemployment continuing to increase at unprecedented levels demand in the next 12 months is also likely to get weaker. Economist such as Ahearne point out that property markets (like most markets) are manic in nature so downturns can be exacerbated beyond sustainable prices. He also points to 40%/60% declines from peak to trough. Asking prices have not yet reached this point afaik. Actual selling prices are likely to also decline where asking prices are declining.

If, like me, you would conclude from the foregoing that price levels likely to decline in next 12 months then it would make more sense not to buy and continue to save (and perhaps try and benefit from softening rental market). This would mean that you would have a lower mortgage and more savings when you eventually decided to buy your 'dream' house, or indeed, you might be able to buy a dreamier house for the same money in a better location in a years time.

For such a large investment decision, the OP should avoid advices such as 'if its right for you' and estate agents et al have been saying since 2007 that there was 'value' to be had in the market.

 

[MrMan]

So, in a discussion on the health implications of eating meat, the fact that someone is a butcher has no bearing?

I would probably listen to a nutritionist, doctor and then hear what the butcher has to say. The fact that you know they are a butcher allows you to enter a caveat when listening to their advice but it would be churlish to completely disregard their comments on the grounds that you believe that you can only have integrity if you are not associated financially with the topic.

 

[MrMan]

No. The estate agent, conveyancing lawyer and mortgage brokers consider such accusations of conflict of interest as trolling.

Well i have asked for reasoned debate and have offered to listen with an open mind yet you continue to return to this nonsense.

If, like me, you would conclude from the foregoing that price levels likely to decline in next 12 months then it would make more sense not to buy and continue to save (and perhaps try and benefit from softening rental market). This would mean that you would have a lower mortgage and more savings when you eventually decided to buy your 'dream' house, or indeed, you might be able to buy a dreamier house for the same money in a better location in a years time.

The key in all of this is the words if and might. I'm not saying you are wrong but the very fact that you use these words means that on some level you must be aware that these levels of drops may not happen. it is important to look at all sides. A buyer could also try to factor in any perceived drops in their asking price.

As regards the daft reports, there are many house duplicated on daft with different agents some can be on 5 or 6 times while there is indeed an over supply it is important to note that these figures are inflated.

 

[NorthDrum]

Are people saying here that Estate Agents and Mortgage advisors are the last people to ask in relation to property prices?

Fair enough . . Thats YOUR opinion . .

We cant trust statistics that are in mediums that may have their own agenda's.? Ok, thats fine - For our own records, which medium doesnt have an agenda?

Thats YOUR opinion.

And can somebody comment on the daft figures that suggest house prices have gone down 19% since the peak at 2007 . . This doesnt really sound right in comparison to the great decline in prices that we are all aware of. Or is it just only certain figures daft post are relevant?

I suppose its a choice on what a person chooses to take out of the figures really . .

Ok, so the advice here is . . .

Dont trust statistics in the media or by any V.I groups, unless they are telling you information opposite to what they actually stand to benefit by, automatically assume they are there to dupe you into buying something you shouldnt. Of course, if the statistics back up your opinion, they are relevant and can be used to silence doubters . . .

If a butcher says, "that meats come from the cleanest farm" he obviously bought it from the dirtiest farm in Ireland and isnt concerned of losing his health and safety licence (afterall, every professional is out to get you and there are no repurcussions for their actions) . .

If a broker can sell you any product, they will, theres no way they are concerned with the fact that the Financial Ombudsman sides in favour of clients in a majority of cases. And anyways, they dont care about getting refferals from clients for the service they offer (a bit silly on their part considering its the best and cheapest source of long term marketing they can do, those crazy dogs) . . . . . .

Oh and buying a house is about timing the market. Dont buy it when price is going down, wait till its rising. Dont worry about renting, its prudent to wait until everybody else is doing it, dont go with your instinct or if you find the house of your dreams, everybody, absoultely everybody should hold off buying . . Simple as . . .




For those of you logging in . . .My post above is my attempt to understand the "open minded" opinions of some of the posters here who are "passionate" protesters that their opinions should mean more then others . . .

 

[Senna]

I would not care about prices ( be they declining or increasing) because I would have no intention of ever moving ever again.

Thats fine if your paying cash and not taking out a mortgage that you could be paying for the next 40 years.
The majority of people asking for advice on here will be buying a mortgage. If that person buys now with no intension to move, they are still paying the mortgage on the purchase amount, future price is irrelevant. But what is very relevant is the cost of the mortgage every month. A 20% drop in prices on a 300k house can equate to 300e less every month for the next 30 years.

As regards the daft reports, there are many house duplicated on daft with different agents some can be on 5 or 6 times while there is indeed an over supply it is important to note that these figures are inflated.

How many estates are listed on daft that have 20/30/100 houses for sale but only one advert? There is no way that daft figures are inflated, how many estate agents dont even use daft? the biggest one in the NW dont.

The 2006 census showed 300k (350k some reports) house unoccupied, of course not all are for sale, but many will be forced onto the market the longer the recession lasts.
The current supply of houses could easily satisfy market needs for the next 5 years (not current market, but a functioning one).

 

[MrMan]

How many estates are listed on daft that have 20/30/100 houses for sale but only one advert? There is no way that daft figures are inflated, how many estate agents dont even use daft? the biggest one in the NW dont.

The 2006 census showed 300k (350k some reports) house unoccupied, of course not all are for sale, but many will be forced onto the market the longer the recession lasts.
The current supply of houses could easily satisfy market needs for the next 5 years (not current market, but a functioning one).

That is also true, but IPAV members for example only had to pay €500 for the year last year to advertise all of their property on daft. That meant that all of those agents could advertise property for little or no cost on the website. It is a popular website and even those estates that you mention will be advertised by 4/5 different agents, I don't see how you can categorically state that there is no way that the figures are inflated.

 

[corkgal]

I'd look for a good rental property with a landlord you find easy to deal with. rents are down too. You can probably afford a nicer place renting and save until you are sure the market is on the way up again.

If you do buy, be aware of all the other costs too, fitting floors, furniture, it all really adds up. There is very little return on it. If you buy new build and spend 40k fitting it out, I doubt you will see the 40k again.

In my opinion the best value in the future will be in older houses in nice areas. These tend to need work and banks will probably not lend to do them up. Often they are estate sales and people need to sell them fast. If you have some cash saved you could end up living in a very nice neighborhood in a few years.

 

[Firefly]

in my opinion the best value in the future will be in older houses in nice areas. These tend to need work and banks will probably not lend to do them up. Often they are estate sales and people need to sell them fast. If you have some cash saved you could end up living in a very nice neighborhood in a few years.

+1

 

[MrMan]

If you do buy, be aware of all the other costs too, fitting floors, furniture, it all really adds up. There is very little return on it. If you buy new build and spend 40k fitting it out, I doubt you will see the 40k again.

That would be some fit out 40k!. If you fit the floors they will remain, when you buy the furniture its yours to bring with you if you move. If you are looking at new builds most of them are including flooring now aswell.

Renting suits some people and doesn't sit well with others. When viewing a property people often ask are the neighbours owner occupiers or renters meaning renters are less desirable, it doesn't make much sense but it is an ingrained attitude.

There are other factors such as security of tenure and being your own boss in that if you want to change colours or hang pictures, knock a wall, build a garage, install an alarm, etc you don't need permission and your not paying for someone elses benefit if you are an owner.

 

[Askar]

The key in all of this is the words if and might. I'm not saying you are wrong but the very fact that you use these words means that on some level you must be aware that these levels of drops may not happen. it is important to look at all sides. A buyer could also try to factor in any perceived drops in their asking price.


As regards the daft reports, there are many house duplicated on daft with different agents some can be on 5 or 6 times while there is indeed an over supply it is important to note that these figures are inflated.

Where did I use the word might? I concluded based on my analysis that prices (both asking and selling) will continue to decline. I am not equivocating. What exactly are you saying? Do you take issue with any of the issues I have raised? Can you present any argument as to why someone (who will more than likely want to move within the next 7 years and will be affected by current economic recession) should buy? Is possibility of negative equity not a serious issue? Are my facts wrong? You say it is imprtant to look at all sides. Well you are free to present the argument as to why and in what circumstances it is a good idea to buy.

So what is your point in relation to daft figures? You accept there is oversupply. What are you saying is the trend? Is oversupply going to continue? Is demand going to pick up? Are banks not going to make lending more scarce? Why should these factors not be considered in a persons decision to buy?

 

[mf1]

"Well you are free to present the argument as to why and in what circumstances it is a good idea to buy."

Not everyone is a first time buyer. I have older clients who would love to trade down to more manageable properties, divorced people who want to sell the family home and each buy their own place, divorced people where one is raising a mortgage and buying the other out, middle aged people who, because of their age, have only a year or so to go before they will be unable to raise a mortgage................

mf

 

[Askar]

"Well you are free to present the argument as to why and in what circumstances it is a good idea to buy."

Not everyone is a first time buyer. I have older clients who would love to trade down to more manageable properties, divorced people who want to sell the family home and each buy their own place, divorced people where one is raising a mortgage and buying the other out, middle aged people who, because of their age, have only a year or so to go before they will be unable to raise a mortgage................

mf

Good examples. I am aware of people in two of those categories. However, as the OP has not indicated any imperative requiring him/her to sell and buy, my analysis did not factor that in. So assuming no imperatives should the OP not have regard to the current market and economic conditions?

 

[MrMan]

Where did I use the word might? I concluded based on my analysis that prices (both asking and selling) will continue to decline. I am not equivocating. What exactly are you saying? Do you take issue with any of the issues I have raised? Can you present any argument as to why someone (who will more than likely want to move within the next 7 years and will be affected by current economic recession) should buy? Is possibility of negative equity not a serious issue? Are my facts wrong? You say it is imprtant to look at all sides. Well you are free to present the argument as to why and in what circumstances it is a good idea to buy.

So what is your point in relation to daft figures? You accept there is oversupply. What are you saying is the trend? Is oversupply going to continue? Is demand going to pick up? Are banks not going to make lending more scarce? Why should these factors not be considered in a persons decision to buy?

My mistake you referred only to ifs although some could consider 'if' to be as conclusive as 'might', either way you are right not to use definitive terms because they cannot be used in terms of what the future holds.

Your argument about someone buying and wanting to sell in years is as you say yourself hypothetical so again arguments on this basis can go either way, the economy could be further in the mire or it could be sorted, 7 years is a long way away.

Negative equity is a serious problem for those who are already in it if they absoluely require the need to move on. I say why not factor in any perceived drops to your offer, does this not seem reasonable. You don't seriously think that each scenario regarding the needs of the purchaser and the type of property/location are always the same. A blanket approach to house buying doesn't make sense to me.

In relation to daft figures I have already agreed that there is oversupply just not in the region being hyped. many people 'test' the market on the cheap and won't sell their homes and agents rarely have sole selling rights so there is duplication everywhere. I think there will continue to be over supply but it will lower as some will now decide that they can't afford to move on and will just start removing property from the market.
There is a stand off between buyers and sellers and sellers cant afford to drop so it wont simply be a free for all in a years time.

Your 'facts' I'm not sure off in that you state what is likely to happen in your opinion and i respect that they are just that, your opinion.

A person should consider all factors before they buy that is the sensible thing to do, I don't recall saying that this isn't the case.

 

[DerKaiser]

Hello,

I am a single person earning 45k a year . I am in the process of getting a mortgage from boi at the moment. If the approval is successful, is now a good time to but for a first time buyer like myself as I am thirty six and not getting any younger ) The house is a new build, was valued at about 260 and am getting if for 190,000 builders finish. This will be my home for as far into the future as I can see, ie. i will not be selling. So, do I keep renting or make the move? I know that there is no definate answer to this, I am just looking for advice? Any help appreciated.

Thanks, David

Keep renting. If the government fully removes the offset of interest against rent in calculating taxable income (it's already gone 25% of the way as of yesterday), then there will be a rush of investors getting out of property over the next couple of years further driving down prices.

We are fast approaching a situation where pre tax rental yields will need to rise to 10%, meaning house prices should fall to 10 times their annual rent

 

[corkgal]

That would be some fit out 40k!.

I could spend 40k on my house in the morning to have it more like what I would like. new kitchen and ensuite, update the flooring etc.
Fit out can cost what you want. Typical budget for a showhouse is well over 40k.