The Great Game II - the Irish Property Empire abroad

And inflation was??
One small point, not overly relevant, but I think Ireland actually joined the Common Market back in '73.
 
Ecstatic, your ideas would be very persuasive if it wasn't for the fact that the boom in Polish property has already happened. You are not buying to piggyback onto capital appreciation due to rising wages, you are buying property that has already appreciated astronomically and hoping to sit it out while the wages of Polish workers play catch-up.

The fundamentals were sound but for now most people involved in buying property in Poland are doing so based on the "greater fool theory".

As for the Polish buying in Ireland? Lots of them have.

This foreign property mania is great if you get in ahead of the pack but by the time it makes a roadshow or an RDS expo I think the game is up.

As an aside. If I was a developer I'd simply pick a country that's off everyone's radar. Laos or Surinam or something. Buy some cheap land and build a big complex of luxury apartments. Then I'd offer a bunch of free penthouses to all the main property sellers here. Then I'd let them hype the place so they could flog their penthouses to the gullible Irish.

Hell, given the rate people here are buying at, this mightn't be a bad idea for some countries to adopt themselves ...
 
Its probably important to note that some of us are speculators, and some take a longer view. Eastern Europe is definitely a longer view. The 20% CapAp days are gone.
I have a 'longer view' in Budapest, but have travelled a lot there over the years and love the place.
Oh, and if I hear another person talking about the walls of the country caving in just because some skin-heads are causing some trouble outside the Government buildings ONE - MORE - TIME!
Don't people realise that an ecomony is stronger than any of that? Especially with the amount of foreign investment Hungary has.
Incidently, Hungary is the econimic center of Eastern Europe. Its neither Poland not Czech, nor anywhere else.

Don't believe the hype when buying, and do the research.
 
paddyd said:
Its probably important to note that some of us are speculators, and some take a longer view. Eastern Europe is definitely a longer view. The 20% CapAp days are gone.
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The current prices reflect an expectation of continuing double digit growth. When this recedes the speculators will exit the market. Some with large wads of cash, some with their fingers very badly burnt. Anyone taking a longer view would be well advised to sit back and look to enter the market after the others have fled, when prices will be much lower.
 



but only in nominal terms.

what was the average wage in each year and tell me the ratio of one to another.

I know there is an increase but not to that extent of a straight out 100k increase.
 
Some of the prices being quoted for poland are more than properties in vastly wealthier germany etc. I have also heard demographics arent great for long term in poland. Just because an economy is growing and is likely to grow for many years doesnt mean property prices will rise hugely. Most of these countries have lots of property built already and plenty of room to build at low cost. Many poles may move to the other european countires permanently when the working restrictions are lifted. Prices in poland seem priced for perfection. Theres always money to be made in any market but buying property in an expo in rds is not the way to make money.
 
while living abroad from the 97 until last year (ie during our property price explosion) I can't recall ever seeing 'rds property expo' style events promoting buying property in Ireland (I was in the states and australia). I did see events for property in Dubai, Spain etc. Does anyone know if Irish property was ever promoted in this way to (non corporate) foreign investors?

The only foreigners I can ever remember buying property here were the Dutch and Germans buying cottages and small farms in the south and west back in the 80's.
 
bogwarrior said:
Does anyone know if Irish property was ever promoted in this way to (non corporate) foreign investors?
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Not at all. One of the reasons the UK currently has a 'soft landing' (which I do not believe will hold), is that alot of international money has flowed in, particularly to London.

This has most certainly not happened in Ireland, which makes a laughing stock of the old property bull adage that "we're like London, Paris & NY now".
 
bogwarrior said:
Does anyone know if Irish property was ever promoted in this way to (non corporate) foreign investors?
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Not picking on these houses in particular because this mother-of-all-ripoffs in being perpetrated at all levels but can you imagine an Irish agent trying to sell these properties at these prices to Dutch or German investors.

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They would laugh in their face and with tears streaming down their faces would be unable to stop themselves laughing for the rest of the day !
 

I'm not so sure Remix; some of those Dutch guys smoke a lot of them 'happy cigarettes' If you could find a Dutch guy off of his head on wacky backy he might be willing to take a Glasthule micro cottage for €500,000 seriously.
 

yes, at current prices of course you're not going to get small-scale foreign investors coming here. But going back 6-7 years, when property prices were half ( or less) of current prices, I don't recall a great clamour from abroad for Irish property, unlike the big advertising push for overseas property we now have here and in the UK. That said, 7 years ago Hans and Jan were probably spending their money on tasty shares in Baltimore Technologies and Pets.com.

Maybe, by the time low interest rates cira late 2001 started to feed the housing frenzy in many countries, the smart money saw that Irish properties prices were already too high. That didn't stop prices increasing further.....
 
Remix said:
can you imagine an Irish agent trying to sell these properties at these prices to Dutch or German investors.

[broken link removed]
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Very true - but I presume Bogwarrior meant was Irish property ever advertised to foreign markets in the pre-boom dark days, when you could buy a 5-bed detached period in Blackrock with acre garden for less than 100k?
Answer is still probably the same - no, since we were a complete basket case and the Europeans probably felt they were already subsidising us enough via EU funds without propping up our ailing property market.
 
Sorry didn't know Bogwarrior was referring to pre-boom days because he opened with

while living abroad from the 97 until last year (ie during our property price explosion) I can't recall ever seeing 'rds property expo'
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Remix

"Fortune, goodnight. Smile once more; spin thy wheel"
 
BigM said:
Very true - but I presume Bogwarrior meant was Irish property ever advertised to foreign markets in the pre-boom dark days
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sorry, should have made it clearer - I meant around 1998-2001 ie when our economy was going up, unemployment was low, rental yields were high (i recall queueing up for the privilege to rent an apartment, there was a real shortage), we were committed to the euro and property prices were far lower than they are now ( I think this is what George Lee calls Celtic Tiger 1).

What would a rundown 1 bed cottage in Glasthule cost then?? (I remember new 3 bed apts in Christchurch going for around 80K (punts) in 98). And why weren't foreigners flocking here to buy, the same way we're encouraged to snap up properties in Budapest, Sofia, Warsaw etc? Weren't our fundamentals better back then, compared to Hungary or Polands now?

Maybe, we had laws which didn't encourage outside investors?
Or maybe, as you say BigM, the Europeans knew our 'form' and kept well clear
 
bogwarrior said:
And why weren't foreigners flocking here to buy, the same way we're encouraged to snap up properties in Budapest, Sofia, Warsaw etc? Weren't our fundamentals better back then, compared to Hungary or Polands now?
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Got to remember that back around 2000 Germany and France weren't exactly awash with cash. The reunification had cost them a bundle, property market in Germany has already nearly bankrupted several of the large State banks so they might have been a bit wary of investing in property at all! (and of course, our 'form' - "Those crazy Irish", as I've heard several German bankers describe us over the years )
 
i think that the investing psychology of different nations plays a large part in these decisions. the Irish mania for all things property realted is now an accepted fact but not all nations get their kicks out of buying property abroad. you will probably find that there is a much stronger equity culture amongst many of the continental Europeans than there is in Ireland (the Spanish being a notable exception). for sure lots of Europeans dream of buying a holiday/retirement home in southern Europe but these same people would probably baulk at the thought of relying upon poperty to fund their retirement.

in fixed income banking in Europe the dull issues are described as being fit for Belgian dentists because these people have been the traditional buyers of solid (if unexciting) corporate bond isues. in much the same way anyone wanting to sell overseas property to individual investors is better off trying the Irish & English as they have a strong bias towards property.
 
I agree fully with your analysis Edo, Ive been thinking the same thing myself. I do not believe eastern europe will be the next ireland, many people here in the late 90s did not believe ireland would be the next ireland. We were extremely lucky in the nineties that global economic forces were all lined up in our favour. However we had to wait nearly 80 years after independence and 25 years after joining the EU for this to occur. IT is worth remembering that a few big multinationals reduced irelands unemployment rate from 10% in 1997 to 4% in 1999. It will take an awful lot more to turn polands rate around simply because poland is a much bigger country. Secondly the high tech boom was on and these companies were in bullish mood. They are not in bullish mood now and if they move to poland it will be for negative reasons (to reduce costs) rather than the positive reasons which encouraged them to move to ireland. Michael O Leary jokingly commented on the irish fascination with investing in property there facilitated by ryanair ( they should be selling to the poles now not buying from them). The only property in eastern europe still worth investing is farmland but this is restricted and is difficult for foreigners to buy
 
Irish property was not advertised abroad for one simple reason: where would you advertise? In the late 90's, as Joe sez above 'people here in the late 90s did not believe ireland would be the next ireland.'. Where would you find some Frenchman, German, English even who would ever come to ireland to buy property? and island cut off from the rest of the continent. These people (particularily the Italians), don't even buy THEIR OWN property! they rent.

Remember we were/are the only country in the EU (perhaps the world) during the same period (90's-now) where the entire country is now cash rich, and we needed to do something with all the cash; so we bought more property here, and we bought more abroad.

we're not buying property because we are all propery experts; we buy it because we have a wad burning a hole in our pockets, and having a property portfolio was the dish du jour!
Very few of us were ever even a landlord in our own country, let alone the far reaches of turkey, or china, or wherever.

Most places are still appreciating, so we are all still making money, but its by pure luck in 99% of the cases!
 

We've maybe caught up somewhat with our fellow Europeans, but we are cash rich only because we are borrowing like crazy. It's all very well going on a mad binge with the credit card, but at some stage you will have to pay it back.
 
paddyd said:
Where would you find some Frenchman, German, English even who would ever come to ireland to buy property? and island cut off from the rest of the continent. These people (particularily the Italians), don't even buy THEIR OWN property! they rent.
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Don't know where you got that impression about low home ownership in Italy. Any articles I've seen have shown them with a similar percentage to us at around 80%:
 
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