Fall in house prices fizzling out.

Ard-Taoiseach

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markmchugh said:
Ard-Taoiseach said:
markmchugh said:
[quote="Ard-Taoiseach":16e7zysh]
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.
no, one of the largest developers in the country......[/quote:16e7zysh]

Sorry, I should have made myself more clear. That developer must belong to the Construction Industry Federation?
 


markmchugh

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Joined
May 25, 2007
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18
Ard-Taoiseach said:
floatingvote said:
[quote="Ard-Taoiseach":3esic0d7]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+% growth, there's a strong, sustained requirement for housing.[/quote:3esic0d7]

surely it would make more sense to allow more land to be zoned for development then?
 

markmchugh

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Messages
18
Ard-Taoiseach said:
markmchugh said:
[quote="Ard-Taoiseach":1ln6qogj]
markmchugh said:
[quote="Ard-Taoiseach":1ln6qogj]
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.
no, one of the largest developers in the country......[/quote:1ln6qogj]

Sorry, I should have made myself more clear. That developer must belong to the Construction Industry Federation?[/quote:1ln6qogj]

i dont know their member list, but i would presume so, they are the only recognised union in ireland?
 

ibis

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Joined
Mar 12, 2005
Messages
12,293
Ard-Taoiseach said:
floatingvote said:
[quote="Ard-Taoiseach":6msgwzo1]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.[/quote:6msgwzo1]

And housing stock growth?
 

droghedasouth

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Joined
May 10, 2007
Messages
1,091
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.
Sometimes I wonder how old you and freedomlover are.
I imagine you are both under 45, probably by a very large margin.

It is amazing how many people, who have never experienced a proper recession, will believe that it is different this time and that the examples of asset booms from "tulip mania" to dot.com will not be repeated here in the bubble represented by "residential property as an investment" .

If you compare property prices in Ireland to Holland, France, Germany and Italy where we all have the same interest rates and similar income levels, house prices in Ireland are typically 40% higher. On top of that their houses are much better built than Irish houses.

That is a good measure of the downside potential for house prices in Ireland.
 

Ard-Taoiseach

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Messages
746
markmchugh said:
Ard-Taoiseach said:
Oh, from the heads at the CIF, then? They are the ones that really know what's going on.
no, one of the largest developers in the country......
i dont know their member list, but i would presume so, they are the only recognised union in ireland?
I think they're the most influential, hence the large-scale draw to them. I don;t have a members list, but, like ISME or the SFA or IBEC, they're pretty comprehensive.

AFAIK, virtually all of the developers that are big enough to build on sites that need pedestrian walk-ways around them are in the CIF.

Unfortunate name, really. Just as well they aren't the Joinery Industry Federation :D .
 

markmchugh

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i experienced the .com thing first hand + it was not pretty, in fact, its very similar to what i see going on in this bubble.....
 

Ard-Taoiseach

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Joined
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Messages
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ibis said:
Ard-Taoiseach said:
floatingvote said:
[quote="Ard-Taoiseach":39qrt3nk]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.
And housing stock growth?[/quote:39qrt3nk]

If you look at dwellings per 1000 population, we're below the EU average. Plus, our vacancy rate, at 15%, compares favourably to the EU average of 18%.
 

Ard-Taoiseach

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droghedasouth 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.
Sometimes I wonder how old you and freedomlover are.
I imagine you are both under 45, probably by a very large margin.
If you read freedomlover's posts closely, he's actually in his 50s. I'm not going to give my age away because I don't see it as necessary here.

It is amazing how many people, who have never experienced a proper recession, will believe that it is different this time and that the examples of asset booms from "tulip mania" to dot.com will not be repeated here in the bubble represented by "residential property as an investment" .
You do realise that there are 1 million more of us here than in the mid-90s? And that the labour market has almost doubled in that period? And that people have vastly imnproved purchasing power? That is what drives our house prices.

If you compare property prices in Ireland to Holland, France, Germany and Italy where we all have the same interest rates and similar income levels, house prices in Ireland are typically 40% higher. On top of that their houses are much better built than Irish houses.

That is a good measure of the downside potential for house prices in Ireland.
If you compare GDP per capita and net wealth, we are some 20-30% richer than those country's you mentioned.

Plus, Germany and Italy are demographic zombies, of course their house prices are going to be below booming Ireland.
 

ibis

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Joined
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Messages
12,293
Ard-Taoiseach said:
ibis said:
[quote="Ard-Taoiseach":ju3ck2jk]
floatingvote said:
[quote="Ard-Taoiseach":ju3ck2jk]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.
And housing stock growth?[/quote:ju3ck2jk]

If you look at dwellings per 1000 population, we're below the EU average. Plus, our vacancy rate, at 15%, compares favourably to the EU average of 18%.[/quote:ju3ck2jk]

Well, no, I was asking after the rate of growth in housing stock?
 

Ard-Taoiseach

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Messages
746
ibis said:
Ard-Taoiseach said:
ibis said:
[quote="Ard-Taoiseach":3egd7p0m]
floatingvote said:
[quote="Ard-Taoiseach":3egd7p0m]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.
And housing stock growth?
If you look at dwellings per 1000 population, we're below the EU average. Plus, our vacancy rate, at 15%, compares favourably to the EU average of 18%.[/quote:3egd7p0m]

Well, no, I was asking after the rate of growth in housing stock?[/quote:3egd7p0m]

It is growing, but only to a level comparable to our European peers. Plus, our average house-hold size is falling, adding more grist to the mill of demand.
 

droghedasouth

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Joined
May 10, 2007
Messages
1,091
Ard-Taoiseach said:
droghedasouth said:
[quote="Ard-Taoiseach":ul29nl8b]
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.
Sometimes I wonder how old you and freedomlover are.
I imagine you are both under 45, probably by a very large margin.
If you read freedomlover's posts closely, he's actually in his 50s. I'm not going to give my age away because I don't see it as necessary here.

It is amazing how many people, who have never experienced a proper recession, will believe that it is different this time and that the examples of asset booms from "tulip mania" to dot.com will not be repeated here in the bubble represented by "residential property as an investment" .
You do realise that there are 1 million more of us here than in the mid-90s? And that the labour market has almost doubled in that period? And that people have vastly imnproved purchasing power? That is what drives our house prices.

If you compare property prices in Ireland to Holland, France, Germany and Italy where we all have the same interest rates and similar income levels, house prices in Ireland are typically 40% higher. On top of that their houses are much better built than Irish houses.

That is a good measure of the downside potential for house prices in Ireland.
If you compare GDP per capita and net wealth, we are some 20-30% richer than those country's you mentioned.

Plus, Germany and Italy are demographic zombies, of course their house prices are going to be below booming Ireland.[/quote:ul29nl8b]

I hardly need to tell you that in Ireland's case GDP per capita is a meaningless figure. GDP is almost 20% more than GNP.

How much of our calculated net wealth is tied up in inflated residential property. I am sure you have noticed on your travels that these countries are much wealthier than Ireland in reality because of decades of investment in both productive and social infrastrucure

Last year, credit growth increased by 30%, an extraordinary rate, while dependence on debt, which currently stands at two and a half times gross national product, is far in excess of all other countries in the European Union.

You can join the British eurosceptic press and start using expressions like demographic zombies, but in the end it all comes down to one simple lesson of history.

There has NEVER been an asset boom anywhere on the scale of that experienced in Ireland over the last 30 years without it all ending in tears.
 

sidonius

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Joined
May 30, 2007
Messages
8
If you look at the UK housing collapse in the 80s (which had all the features of our past boom) house prices flatlined for between 12 and 15 months (depending on what you call a 'flat' line) before falling off a cliff. I very much doubt our boom will end in a different manner. I reckon prices started to flatline around October last year. I think we'll see the steep decline start in the spring selling season with an accelaration in the autumn of 2008.

The reason bank interest rates are rising faster than the ECB rate is not just normal bank greed - they're paying about 50 basis points (0.5%) above the ECB rate for the money they lend to you - this could well rise to 100 and maybe even 150 bp in the near term - the crisis in the banking system has not unwound yet! - be warned.
 

Ard-Taoiseach

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Joined
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Messages
746
sidonius said:
If you look at the UK housing collapse in the 80s (which had all the features of our past boom) house prices flatlined for between 12 and 15 months (depending on what you call a 'flat' line) before falling off a cliff. I very much doubt our boom will end in a different manner. I reckon prices started to flatline around October last year. I think we'll see the steep decline start in the spring selling season with an accelaration in the autumn of 2008.
And the UK situation saw savage rises and falls in interest and exchange rates. The rancour of the late 80s/early 90s put's this in the ha'penny place

The reason bank interest rates are rising faster than the ECB rate is not just normal bank greed - they're paying about 50 basis points (0.5%) above the ECB rate for the money they lend to you - this could well rise to 100 and maybe even 150 bp in the near term - the crisis in the banking system has not unwound yet! - be warned.
And Libor rates have begun to fall.
 

ibis

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Joined
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Messages
12,293
Ard-Taoiseach said:
ibis said:
[quote="Ard-Taoiseach":kikq8vur]
ibis said:
[quote="Ard-Taoiseach":kikq8vur]
floatingvote said:
[quote="Ard-Taoiseach":kikq8vur]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.
And housing stock growth?
If you look at dwellings per 1000 population, we're below the EU average. Plus, our vacancy rate, at 15%, compares favourably to the EU average of 18%.[/quote:kikq8vur]

Well, no, I was asking after the rate of growth in housing stock?[/quote:kikq8vur]

It is growing, but only to a level comparable to our European peers. Plus, our average house-hold size is falling, adding more grist to the mill of demand.[/quote:kikq8vur]

Perhaps you can see why I'm asking. If the rate of growth of housing stock were keeping pace with population growth and household formation, then there would be no rise in house prices that could not be explained by either wage growth or a bubble. If the ratio of house price to income has markedly increased, even though the rate of housing stock increase has roughly kept pace with population growth and household formation, then we're looking at an asset bubble, not a demand curve.
 

Ard-Taoiseach

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Messages
746
ibis said:
Ard-Taoiseach said:
ibis said:
[quote="Ard-Taoiseach":t2mjtbbn]
ibis said:
[quote="Ard-Taoiseach":t2mjtbbn]
floatingvote said:
[quote="Ard-Taoiseach":t2mjtbbn]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.
And housing stock growth?
If you look at dwellings per 1000 population, we're below the EU average. Plus, our vacancy rate, at 15%, compares favourably to the EU average of 18%.
Well, no, I was asking after the rate of growth in housing stock?[/quote:t2mjtbbn]

It is growing, but only to a level comparable to our European peers. Plus, our average house-hold size is falling, adding more grist to the mill of demand.[/quote:t2mjtbbn]

Perhaps you can see why I'm asking. If the rate of growth of housing stock were keeping pace with population growth and household formation, then there would be no rise in house prices that could not be explained by either wage growth or a bubble. If the ratio of house price to income has markedly increased, even though the rate of housing stock increase has roughly kept pace with population growth and household formation, then we're looking at an asset bubble, not a demand curve.[/quote:t2mjtbbn]

That makes sense, ibis, but IIB bank have a paper out(I'm quoting the summary to save you time) saying that Ireland's housing market really isn't the bubble people presume it to be.
 

jam_mac_jam

Member
Joined
May 16, 2007
Messages
70
Ard-Taoiseach said:
droghedasouth said:
[quote="Ard-Taoiseach":3sqi4b14]
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.
Sometimes I wonder how old you and freedomlover are.
I imagine you are both under 45, probably by a very large margin.
If you read freedomlover's posts closely, he's actually in his 50s. I'm not going to give my age away because I don't see it as necessary here.

It is amazing how many people, who have never experienced a proper recession, will believe that it is different this time and that the examples of asset booms from "tulip mania" to dot.com will not be repeated here in the bubble represented by "residential property as an investment" .
You do realise that there are 1 million more of us here than in the mid-90s? And that the labour market has almost doubled in that period? And that people have vastly imnproved purchasing power? That is what drives our house prices.

If you compare property prices in Ireland to Holland, France, Germany and Italy where we all have the same interest rates and similar income levels, house prices in Ireland are typically 40% higher. On top of that their houses are much better built than Irish houses.

That is a good measure of the downside potential for house prices in Ireland.
If you compare GDP per capita and net wealth, we are some 20-30% richer than those country's you mentioned.

Plus, Germany and Italy are demographic zombies, of course their house prices are going to be below booming Ireland.[/quote:3sqi4b14]

Do you really honestly believe that Ireland is richer then Germany or France? Germany for f**ks sake? Per square foot we are more expensive in some areas in Dublin then Manhattan and London and Paris, richer then New York, oh would you please stop. Its fundamentals, demographics, we have reached a permanent plataeu of high prices. No, we havent. Since 2000 or 2001 house prices have been driven by speculation. Like all booms, it ends.

We have similar income levels with much higher prices then those countries, this is not sustainable. That's it, its not different this time. Property is not magic is over inflated and the price is going to drop.
 

jam_mac_jam

Member
Joined
May 16, 2007
Messages
70
Ard-Taoiseach said:
ibis said:
[quote="Ard-Taoiseach":15nmhas4]
ibis said:
[quote="Ard-Taoiseach":15nmhas4]
ibis said:
[quote="Ard-Taoiseach":15nmhas4]
floatingvote said:
[quote="Ard-Taoiseach":15nmhas4]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.
And housing stock growth?
If you look at dwellings per 1000 population, we're below the EU average. Plus, our vacancy rate, at 15%, compares favourably to the EU average of 18%.
Well, no, I was asking after the rate of growth in housing stock?[/quote:15nmhas4]

It is growing, but only to a level comparable to our European peers. Plus, our average house-hold size is falling, adding more grist to the mill of demand.[/quote:15nmhas4]

Perhaps you can see why I'm asking. If the rate of growth of housing stock were keeping pace with population growth and household formation, then there would be no rise in house prices that could not be explained by either wage growth or a bubble. If the ratio of house price to income has markedly increased, even though the rate of housing stock increase has roughly kept pace with population growth and household formation, then we're looking at an asset bubble, not a demand curve.[/quote:15nmhas4]

That makes sense, ibis, but IIB bank have a paper out(I'm quoting the summary to save you time) saying that Ireland's housing market really isn't the bubble people presume it to be.[/quote:15nmhas4]

They would be unbiased anyway wouldnt they. I must have a read of that to see what their definition of a bubble is then.
 

stormwind

New member
Joined
Sep 18, 2007
Messages
4
sidonius said:
If you look at the UK housing collapse in the 80s (which had all the features of our past boom) house prices flatlined for between 12 and 15 months (depending on what you call a 'flat' line) before falling off a cliff. I very much doubt our boom will end in a different manner. I reckon prices started to flatline around October last year. I think we'll see the steep decline start in the spring selling season with an accelaration in the autumn of 2008.

The reason bank interest rates are rising faster than the ECB rate is not just normal bank greed - they're paying about 50 basis points (0.5%) above the ECB rate for the money they lend to you - this could well rise to 100 and maybe even 150 bp in the near term - the crisis in the banking system has not unwound yet! - be warned.

good points.I saw the same flatlining in the USA.It started in Rural areas in late Summer 2005 and spread into urban areas late 2005, early 2006.Prices changed little until the Fall of 2006.
Houses just stopped selling between january 2006 and Fall of 2006.Then prices stared to fall ,slowly at first ,increasing in early 2007 and now falling off the cliff.

So that ties in with your assessment.
 

Ard-Taoiseach

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Joined
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Messages
746
jam_mac_jam said:
[quote="Ard-Taoiseach":23kq0s9t]
ibis said:
[quote="Ard-Taoiseach":23kq0s9t]
ibis said:
[quote="Ard-Taoiseach":23kq0s9t]
ibis said:
[quote="Ard-Taoiseach":23kq0s9t]

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.
And housing stock growth?
If you look at dwellings per 1000 population, we're below the EU average. Plus, our vacancy rate, at 15%, compares favourably to the EU average of 18%.
Well, no, I was asking after the rate of growth in housing stock?
It is growing, but only to a level comparable to our European peers. Plus, our average house-hold size is falling, adding more grist to the mill of demand.[/quote:23kq0s9t]

Perhaps you can see why I'm asking. If the rate of growth of housing stock were keeping pace with population growth and household formation, then there would be no rise in house prices that could not be explained by either wage growth or a bubble. If the ratio of house price to income has markedly increased, even though the rate of housing stock increase has roughly kept pace with population growth and household formation, then we're looking at an asset bubble, not a demand curve.[/quote:23kq0s9t]

That makes sense, ibis, but IIB bank have a paper out(I'm quoting the summary to save you time) saying that Ireland's housing market really isn't the bubble people presume it to be.[/quote:23kq0s9t]

They would be unbiased anyway wouldnt they. I must have a read of that to see what their definition of a bubble is then.[/quote:23kq0s9t]

If it was really some piece of spin, I think they would have blared it out across all the media. It's a pretty refreshing read.
 


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