QuoteAllied Irish BankOriginally Posted by Poor Student
Didn't the estate agents say 3 months ago that we were plateau'ing and that prices would move up soon and the level of interest in new developments that had re-priced was unprecedented.........
Allied Irish Bank
Last edited by Lionel Ritchie; 25/06/2008 at 12:28 PM.
" I wish to God that someone would be able to block out the voices in my head for five minutes, the voices that scream, over and over again: "Why do they come to me to die?"
I wouldn't have a clue to be honest, I'm a public transport kinda guyJebus he must be getting a euro per mile to make that journey worth it.
I hear that economist guy Bacon is doing the whole "I told you so" routine. He must be the back seat driver...
Lots of people can now do the "I told you so" routine. McWilliams, the Economist magazine amongst others*. No reason why they shouldn't.
*Me also. But I have very little schadenfreude as I'll suffer financially like most people.
i was in cork about a month ago - this topic is something i don't alot about in recent times as i live in the uk - but basically i was talking to a developer - i asked him what was going on in terms of the housing market - he said basically that this day has been coming for a long time and he believed that "greed amongst builders/developers" was the prime cause ,any thoughts
"Crash" is a word I struggle with.
For example if the value of something is 100 and in 10 years it goes up to 600 but in year 11 it drops to 550, the word "crash" is a leap
There is clearly a drop off the the utter insanity of growth in house prices but while in isolation in the last 12 months there has been a signifcant drop, looked even in the medium term, crash is a leap
Having said that, if you bought 12 moinths ago, you have a negative return - if you bought 10 years ago you still have a massive profit
So my post really tells you nothing - I'll get me coat.......
DB Cooper is alive !
Problem is though, there is property up here for example that, when bought new a 3 bed semi in a good area was sold new 3 years ago for €210k the same property is advertised with estate agents for €195k as guide price.
I love the way the media churn out the "E3m home now going for only E2m". Like who gives a...?
I presume some homes are selling or all the Estate Agents would have closed? My definition of crash is when cannot sell anything.
I wonder are investors buying now? Just like shares best to buy in the slump. Will prices increase again?
Wouldnt have thought investors will buy now - obviously better to buy at the beginning of the rising cycle, not at the end of it.
Prices will rise again, but you'll have to wait 7 years, give or take, for the cycle to repeat again.
LTID
Of course some stuff will always sell. However, the amount of properties for sale has been increasing steadily over the past while indicating that stocks in general are not shifting.
Quite the opposite, specuvestors pulling out of the market are reducing the prices as they were helping fuel inflation. Beware of a dead cat bounce in a cycle. It's nowhere near the bottom yet.I wonder are investors buying now? Just like shares best to buy in the slump. Will prices increase again?
I'm told we're approaching that situation with property ...or property in a particular price band at least. I visited a spanking new showhouse last weekend where they've cut the asking price from 360K to 315K.
Two of the houses I've looked at in recent times have been on the market for nearly 12 months. They're priced in the 350k region and I'm hearing that not only are the asking prices dropping but they're just not getting any offers at all. Peoples confidence is through the floor in terms of job security etc.
On the other hand my own house is on the market a little over a month for under 200K and with minimal marketing we've two offers of the asking price.
" I wish to God that someone would be able to block out the voices in my head for five minutes, the voices that scream, over and over again: "Why do they come to me to die?"
There's a set of flats down the road from me that have been on offer for at least a year, and not one of them has gone yet.
A year down the line there should be some good deals going, but will the Bank lend you the dough, and what kind of interest rates will you be paying?
Hard to see the Banks been so eager to lend to speculators in the near future particularly with the rental market in decline.
A good deal in the context of what though? 2006 overvalued prices?
On banks lending to speculators. PTSB, one of the major players in the mortgage market, have pulled their buy-to-let mortgages. http://www.rte.ie/news/2008/0620/mortgage.html
Also, on Pete's point about estate agents closing, Lisney have asked employees to take a 10% pay cut. http://www.rte.ie/business/2008/0620/lisney.html
A 7% drop in three years....?!
That's some crash......
You wouldn't even scratch your bumper with that sort of slow motion impact...
The difference between the property market in England and Ireland is very illuminating.
The decline in Ireland started earlier and has gone deeper. It appears primarily to have been triggered by a relatively quick change from under-supply to over-supply in the market.
On the the hand, Britain has been incapable of addressing its housing under-supply problem (more homes were built in the Republic in 2007, for example, than in all of Britain - despite a population almost 15 times bigger there) which, coupled with cheap credit, drove the last property boom. What is screwing the property market in Britain now is largely the latter of those two market drivers - the mortgage situation. There is still a lot of pent-up demand - it's mostly just struggling to borrow at rates it feels comfortable with, or waiting to see what happens.
American banks have a lot to answer for.
I'd widen that to banks in general have a lot to answer for.
They are now reaping what they sowed in terms of the CDOs, CDS' and a lot of the other financial sleight of hand that was supposed to distribute risk more effectively (reminds me of the saying that when you're playing poker and you can't work out who the mug at the table is, its probably you). One of the interesting stats is that whilst sub-prime mortgages were a US phenoma, European banks (the mugs at the poker table) bought most of the packaged stuff thats now defaulting.
BUT, in Ireland and UK we have the additional problem of mortgages that originated as prime, but are now sliding into sub-prime due to affordability issues. That is much, much more of a problem for our economy and we can't really blame America for that.
See, that's where they're going wrong. If they advertise them as apartments they'll flog them in no time
DEVELOPERS START TO PANIC
Two of the country's leading property companies are offering home buyers interest-free loans in an attempt to stimulate activity in the housing market.
Glenkerrin Homes, run by developer Ray Grehan, and Radora, which is controlled by Bernard McNamara and associates, are offering packages to assist would-be buyers at key Dublin locations.
Builders step in where lenders fear to tread; a lack of money and a lack of confidence - that is how Ray Grehan of Glenkerrin Homes assessed the problems in the housing market.
AdvertisementFellow developer Mr McNamara's apartment development in Elm Park in Dublin 4 has already seen prices fall 20% to attract buyers.
Radora is now offering interest free loans of up to 30% of the selling price to be paid back within five years.
According to a statement, Glenkerrin is stepping in to help out those no longer able to secure loans of up to 95%.
Potential buyers of its properties Stillorgan, Ballinteer and Lucan will have to pay 5% of the asking price. They can then avail of an interest-free loan of 15% of the price to be repaid in seven years.
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