Fall in house prices fizzling out.

michael1965

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General_Hoche said:
It just shows how the builders/developers have the real power in this country. They shut off house building like a tap when prices drop marginally. Heaven forbid that an affordable house, or even a fairly priced house, be available to the people of this 'republic'. :evil:
The impression I'm getting is that developers who have the financial muscle are playing a waiting game, and refusing to drop prices by anything significant. They simply stop building any new houses, to minimise their costs. But sooner or later, if demand doesn't pick up, then the weaker builders will come under pressure, and be forced to drop prices. They might be betting that the inevitable rise in rents will force buyers back into the market in time. It's all a big game to see who blinks first.
 


General_Hoche

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saratoga said:
General_Hoche said:
saratoga said:
[quote="General_Hoche":peq1io39]It just shows how the builders/developers have the real power in this country. They shut off house building like a tap when prices drop marginally. Heaven forbid that an affordable house, or even a fairly priced house, be available to the people of this 'republic'. :evil:
By 'power', you presumably mean the power to not build houses if you don't want to? Wow, they really are underhand.
By 'power', I mean the scam of constantly selling houses for €400,000 when they were built for €100,000. If supply ever overtook demand, this scam would end. Supply will NEVER overtake demand as long as builders can operate outside the scrutiny of government [and dont hold your breath for this current crowd to ever introduce housing targets for builders] You obviously believe that the bankrupting of young people to buy a roof over their heads is right and just.
No. And that's not what you referred to or implied by the use of the term 'power' in your original post. You specifically talked about 'turning off supply like a tap'. Obviously you think builders don't have the right to stop building houses when they, well, don't want to build houses anymore? They're trying to make a profit, do they have to apologise for that?[/quote:peq1io39]

Is 100% profit not good enough? That would make the average price of a house in Dublin €200,000. Problem solved. Why does every business person in this country have to tear the arse out of every god-damn thing and ruin peoples lives in the process?
 

ibis

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michael1965 said:
General_Hoche said:
It just shows how the builders/developers have the real power in this country. They shut off house building like a tap when prices drop marginally. Heaven forbid that an affordable house, or even a fairly priced house, be available to the people of this 'republic'. :evil:
The impression I'm getting is that developers who have the financial muscle are playing a waiting game, and refusing to drop prices by anything significant. They simply stop building any new houses, to minimise their costs. But sooner or later, if demand doesn't pick up, then the weaker builders will come under pressure, and be forced to drop prices. They might be betting that the inevitable rise in rents will force buyers back into the market in time. It's all a big game to see who blinks first.
This bit, then, would be the 'phony war' period? Interesting analysis, could well be true.
 

droghedasouth

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ibis said:
michael1965 said:
General_Hoche said:
It just shows how the builders/developers have the real power in this country. They shut off house building like a tap when prices drop marginally. Heaven forbid that an affordable house, or even a fairly priced house, be available to the people of this 'republic'. :evil:
The impression I'm getting is that developers who have the financial muscle are playing a waiting game, and refusing to drop prices by anything significant. They simply stop building any new houses, to minimise their costs. But sooner or later, if demand doesn't pick up, then the weaker builders will come under pressure, and be forced to drop prices. They might be betting that the inevitable rise in rents will force buyers back into the market in time. It's all a big game to see who blinks first.
This bit, then, would be the 'phony war' period? Interesting analysis, could well be true.
Yes, but this could very well be a long war, not a blitzkrieg.

Financially overextended builders who have bought landbanks at inflated values financed by bank borrowings might start to feel the pich.
 

freedomlover

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michael1965 said:
General_Hoche said:
It just shows how the builders/developers have the real power in this country. They shut off house building like a tap when prices drop marginally. Heaven forbid that an affordable house, or even a fairly priced house, be available to the people of this 'republic'. :evil:
The impression I'm getting is that developers who have the financial muscle are playing a waiting game, and refusing to drop prices by anything significant. They simply stop building any new houses, to minimise their costs. But sooner or later, if demand doesn't pick up, then the weaker builders will come under pressure, and be forced to drop prices. They might be betting that the inevitable rise in rents will force buyers back into the market in time. It's all a big game to see who blinks first.
This theory would not apply to second-hand houses. It also ignores the fact that there is a time-lag of close to a year between a decision to cut down on building new houses and a reduction in the supply of completed new houses. The number of new house starts this year is well down, but that won't be reflected in new house completions until next year. The number of new houses completed this year will be close to 80,000, which is extremely high historically for Ireland and in comparison with other countries, although slightly down from last year's exceptional 88,000 figure.
 

DeGaulle

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There is a web-site http://www.thepropertypin.com/ which documents property price drops. One interesting thing that has happened lately is that myhome.ie has started showing prices as images rather than text, to try and make it difficult for people to see how much prices are falling.

Some other worrying figurs: 40% of first-time buyers have 35 year+ mortgages. What's going to happen to them if they end up in negative equity?
http://www.finfacts.com/irelandbusinessnews/publish/article_1011365.shtml
 

ibis

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DeGaulle said:
There is a web-site http://www.thepropertypin.com/ which documents property price drops. One interesting thing that has happened lately is that myhome.ie has started showing prices as images rather than text, to try and make it difficult for people to see how much prices are falling.

Some other worrying figurs: 40% of first-time buyers have 35 year+ mortgages. What's going to happen to them if they end up in negative equity?
http://www.finfacts.com/irelandbusinessnews/publish/article_1011365.shtml
They'll be there for a very long time?
 

factual

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Falling house prices are good as they make houses easier to afford for those struggling to make ends meet on a limited budget.
 

Aragon

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ibis said:
michael1965 said:
General_Hoche said:
It just shows how the builders/developers have the real power in this country. They shut off house building like a tap when prices drop marginally. Heaven forbid that an affordable house, or even a fairly priced house, be available to the people of this 'republic'. :evil:
The impression I'm getting is that developers who have the financial muscle are playing a waiting game, and refusing to drop prices by anything significant. They simply stop building any new houses, to minimise their costs. But sooner or later, if demand doesn't pick up, then the weaker builders will come under pressure, and be forced to drop prices. They might be betting that the inevitable rise in rents will force buyers back into the market in time. It's all a big game to see who blinks first.
This bit, then, would be the 'phony war' period? Interesting analysis, could well be true.
The 'inevitable rise in rents' is unlikely to happen for the simple reason that there are more houses available to rent than there are people to rent them. There are many, many people who by extending themselves financially, built/bought second homes with a view to letting them and who cannot afford to play the big speculators wait and see game. They need income from those homes now and something is better than nothing. With the anticipated increases in job losses, demand for rented accommodation is likely to decrease as eastern european people feel the pinch and maybe go home or elsewhere.
 

michael1965

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freedomlover said:
michael1965 said:
General_Hoche said:
It just shows how the builders/developers have the real power in this country. They shut off house building like a tap when prices drop marginally. Heaven forbid that an affordable house, or even a fairly priced house, be available to the people of this 'republic'. :evil:
The impression I'm getting is that developers who have the financial muscle are playing a waiting game, and refusing to drop prices by anything significant. They simply stop building any new houses, to minimise their costs. But sooner or later, if demand doesn't pick up, then the weaker builders will come under pressure, and be forced to drop prices. They might be betting that the inevitable rise in rents will force buyers back into the market in time. It's all a big game to see who blinks first.
This theory would not apply to second-hand houses.
Yes and no. The market for 2nd hand houses is still influenced heavily by the market for new houses. In particular, it's the market for new starter houses that props up the rest.
It also ignores the fact that there is a time-lag of close to a year between a decision to cut down on building new houses and a reduction in the supply of completed new houses.
No. A lot of developments have downed tools at whatever stage they were at, and won't resume until buyers return.
 

michael1965

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Aragon said:
ibis said:
michael1965 said:
General_Hoche said:
It just shows how the builders/developers have the real power in this country. They shut off house building like a tap when prices drop marginally. Heaven forbid that an affordable house, or even a fairly priced house, be available to the people of this 'republic'. :evil:
The impression I'm getting is that developers who have the financial muscle are playing a waiting game, and refusing to drop prices by anything significant. They simply stop building any new houses, to minimise their costs. But sooner or later, if demand doesn't pick up, then the weaker builders will come under pressure, and be forced to drop prices. They might be betting that the inevitable rise in rents will force buyers back into the market in time. It's all a big game to see who blinks first.
This bit, then, would be the 'phony war' period? Interesting analysis, could well be true.
The 'inevitable rise in rents' is unlikely to happen for the simple reason that there are more houses available to rent than there are people to rent them.
But, if people aren't buying houses, then they have to rent. I suspect the supply overhang in Dublin and other major economic centres is not that high. You hear people quoting total figures for unoccupied houses throughout the country, but that's garbage. Each region is a separate market. When you look at the number of new people needing houses to live in each year, it is inevitable that rents will rise if the supply of houses is not keeping up.
 

DeGaulle

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ibis said:
DeGaulle said:
There is a web-site http://www.thepropertypin.com/ which documents property price drops. One interesting thing that has happened lately is that myhome.ie has started showing prices as images rather than text, to try and make it difficult for people to see how much prices are falling.

Some other worrying figurs: 40% of first-time buyers have 35 year+ mortgages. What's going to happen to them if they end up in negative equity?
http://www.finfacts.com/irelandbusinessnews/publish/article_1011365.shtml
They'll be there for a very long time?
It probably does mean they'll be there for a long time - much longer than they intended. Most intend to move after a few years but won't be able to if they are stuck in negative equity.

Also, property prices are not going to fall evenly. If they fall 30% in Dublin, they will fall 50 or 60% in the Midlands. If you have a 35 year mortgage on a house in Laois/Offaly/Westmeath and want to move closer to Dublin your prospects are not great.
 

politicaldonations

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The esri/tsb index is a load of crap. Its methodology is flawed and there is time lags in the data. Sherry Fitzgerald have said prices have fallen by 7+% since start of year and when estate agents say that prices have "fallen" you know its at least that amount. The figures for new properties include all the extras developers are throwing in so full price drops are'nt reflected in figures. Why did ESRI in a seperate publication last week say prices would be down by 14% by end of year if they are saying in ptsb/esri index that prices are only down 3.3% since start year?
 

markmchugh

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there's been a good story doing the rounds recently ( put out by property developers ), "the scare is only temporary, its going to keep growing after the slow period". I think this may have taken some people into the market....
 

Ard-Taoiseach

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markmchugh said:
there's been a good story doing the rounds recently ( put out by property developers ), "the scare is only temporary, its going to keep growing after the slow period". I think this may have taken some people into the market....
Balanced by George Lee, Futureshock and David McWilliams. The media diet has been almost exclusively pessimistic sinc ethe start of the year. I'm surprised the market has held up so well under the barrage of doom and gloom stories. I suppose it's just the strong underlying dynamic of Ireland's economy showing through again.
 

markmchugh

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Ard-Taoiseach said:
markmchugh said:
there's been a good story doing the rounds recently ( put out by property developers ), "the scare is only temporary, its going to keep growing after the slow period". I think this may have taken some people into the market....
Balanced by George Lee, Futureshock and David McWilliams. The media diet has been almost exclusively pessimistic sinc ethe start of the year. I'm surprised the market has held up so well under the barrage of doom and gloom stories. I suppose it's just the strong underlying dynamic of Ireland's economy showing through again.
no, i heard this from people really in the know, in the industry...they work at building the things
 

Ard-Taoiseach

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markmchugh said:
Ard-Taoiseach said:
markmchugh said:
there's been a good story doing the rounds recently ( put out by property developers ), "the scare is only temporary, its going to keep growing after the slow period". I think this may have taken some people into the market....
Balanced by George Lee, Futureshock and David McWilliams. The media diet has been almost exclusively pessimistic sinc ethe start of the year. I'm surprised the market has held up so well under the barrage of doom and gloom stories. I suppose it's just the strong underlying dynamic of Ireland's economy showing through again.
no, i heard this from people really in the know, in the industry...they work at building the things
Oh, from the heads at the CIF, then? They are the ones that really know what's going on.
 

floatingvote

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Ard-Taoiseach said:
Balanced by George Lee, Futureshock and David McWilliams. The media diet has been almost exclusively pessimistic sinc ethe start of the year. I'm surprised the market has held up so well under the barrage of doom and gloom stories. I suppose it's just the strong underlying dynamic of Ireland's economy showing through again.
Ard-Taoiseach and Freedom lover, you are not looking at the fundamentals, houses are too expensive relative to salaries, that's it, do yous understand that??
 

markmchugh

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Ard-Taoiseach said:
markmchugh said:
[quote="Ard-Taoiseach":2qb7dpvk]
markmchugh said:
there's been a good story doing the rounds recently ( put out by property developers ), "the scare is only temporary, its going to keep growing after the slow period". I think this may have taken some people into the market....
Balanced by George Lee, Futureshock and David McWilliams. The media diet has been almost exclusively pessimistic sinc ethe start of the year. I'm surprised the market has held up so well under the barrage of doom and gloom stories. I suppose it's just the strong underlying dynamic of Ireland's economy showing through again.
no, i heard this from people really in the know, in the industry...they work at building the things
Oh, from the heads at the CIF, then? They are the ones that really know what's going on.[/quote:2qb7dpvk]

no, one of the largest developers in the country......
 

Ard-Taoiseach

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floatingvote said:
Ard-Taoiseach said:
Balanced by George Lee, Futureshock and David McWilliams. The media diet has been almost exclusively pessimistic sinc ethe start of the year. I'm surprised the market has held up so well under the barrage of doom and gloom stories. I suppose it's just the strong underlying dynamic of Ireland's economy showing through again.
Ard-Taoiseach and Freedom lover, you are not looking at the fundamentals, houses are too expensive relative to salaries, that's it, do yous understand that??
Well, with jobs growth of 3.9%, pop growth of 2.5% and household-formation pop growth at 4+%, there's a strong, sustained requirement for housing.
 


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