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Irish Property Market About To R E A L L Y Crash

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http://www.bloomberg.com/news/2010-10-04/irish-house-prices-fall-market-not-yet-at-bottom-report-says.html

Irish Housing Market Has Yet to Trough as Prices Extend Drop, Report Says

By Colm Heatley - Oct 5, 2010 12:01 AM GMT+0100

Business ExchangeTwitterDeliciousDiggFacebookLinkedInNewsvinePropellerYahoo! BuzzPrint A house for sale in north Dublin, Ireland. Photographer: Crispin Rodwell/Bloomberg

Ireland’s housing-market slump has yet to trough in the wake of the recession, property website operator MyHome said, after two reports showed price declines continued in the third quarter.

Home values dropped 3.9 percent in the three months through September from the second quarter, when they fell 3.4 percent, the Dublin-based company said in a statement late yesterday. A separate report from property company Daft.ie today showed prices declined 3.7 percent in the same period.

House prices, which quadrupled in the decade through 2007, have plunged since then as the economy shrank, unemployment soared to a 16-year high and banks restricted lending. The lack of demand for property has curbed construction, which will continue to act as a drag on economic growth this year, Ireland’s central bank said yesterday.

“It is clear that we have not yet reached the bottom,” said Jean Goggin, author of the Myhome report and an economic consultant with DKM Economic Consultants in Dublin. “We will have to see an improvement in the labor market and the general economy before the property market picks up.”

Daft said the average cost of a home in Ireland has fallen 37 percent from its peak to an average 195,000 euros ($266,994). It also said that the total housing stock on the market remains at around 60,000.

“Reflecting the overhang of unsold stock and the weakness of demand conditions generally, commercial construction is likely to decline significantly this year,” the central bank said in its quarterly bulletin, when it cut its growth forecasts for this year and next. It also said further property-price declines are “in prospect.”

37% down having quadrupled? I would say they have a looong way to go down yet.

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Will this be the end for the Irish banking system then?

interestrateripoff,

You use the term 'banking system' in its loosest sense.

If what you define 'banking system' as a fraudulent system which cons depositors into depositing money with crooks who are going to give money to their mates under the guise of a 'loan' knowing that it wont be paid back, indeed knowing that the money will be fraudulently conveyed so that the money ends up permanently with someone else, then I guess this system is coming to an end. Not because the crooks are being prosecuted, but because most of the money has been taken, and those who have not yet had the money stolen from them are choosing to buy gold instead.

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http://uk.reuters.com/article/idUKLNE69400Y20101005?rpc=401&feedType=RSS&feedName=propertyNews&rpc=401

Irish house prices fall 16 percent in September

DUBLIN | Tue Oct 5, 2010 7:54am BST

DUBLIN (Reuters) - Asking prices for Irish homes fell 16 percent in September compared with a year ago as nervous and cash-strapped would-be buyers stayed out of the market, property website Daft.ie said on Tuesday.

The drop, the smallest year-on-year contraction since late 2008, left average prices 37 percent below their 2007 peak after which the spectacular bursting of Ireland's property bubble brought a painful end to the "Celtic Tiger" boom.

Years of reckless bank lending during that heady period has forced Ireland to bailout most of its banks and the government revealed last week that the total bill for cleaning up the sector could top 50 billion euros.

Daft, which advertises nine out of every 10 properties for sale in Ireland, said the resultant lack of finance available to potential buyers continued to help push prices down.

"The key driver of house prices at the moment is the mismatch of supply and demand," Ronan Lyons,

"Many would-be first-time buyers still lack either the confidence or the finance to enter the sales market. As a result, the total supply on the market still remains very high. The total stock has been close to 60,000 for over two years."

Daft.ie's index of residential asking prices fell to 61.6 in September from 62.3 in August and 72.9 in September 2009.

That meant that prices fell 3.7 percent in the third quarter of the year, bringing the average price to 195,000 euros (169,000 pounds).

Economists surveyed by Reuters last week forecast that the 10.7 percent contraction Daft reported to end-September would translate into a 14.6 percent fall for the whole year and that 2011 prices would fall by 2.7 percent.

The permanent tsb/ESRI index, another measure that many economists use as a benchmark, showed in July that prices fell by 1.7 percent in the second quarter of the year.

That survey, which is now published on a quarterly basis, rather than a monthly basis because there are not enough mortgages being issued to provide accurate monthly data, put the fall from peak at 35 percent.

(Reporting by Padraic Halpin; Editing by Ron Askew)

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Truly crash-tastic numbers.

People who claim housing always goes up and that certain areas are immune to a crash need their head examining.

It's been a bubble goddamit and the massive rises and falls that Ireland has experienced makes that clear.

Just want to see a bit of this on our shores now.

Edited by Kyoto

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Truly crash-tastic numbers.

People who claim housing always goes up and that certain areas are immune to a crash need their head examining.

It's been a bubble goddamit and the massive rises and falls that Ireland has experienced makes that clear.

Just want to see a bit of this on our shores now.

195,000 Euros for an average house in Ireland.. I think they may be a fair way from the bottom.

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195,000 Euros for an average house in Ireland.. I think they may be a fair way from the bottom.

Really, yeah still a loooong way to go!

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Should see the true circle.. up 4x then down 75%, to end in the same place.

Markets always overshoot. I would not be surprised if it falls 85% of the value, simply because there will be no banks able to lend any money and very few people able to purchase.

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I don't live in Eire.

RBS is hugely exposed to the Eire property market.

I wonder if they'll see the Eire of their ways.

Unfortunately I can't see a repeat of Ireland in the U.K. housing market, as the over-supply their is huge. I go over 3 or 4 times a year and over the last decade I have been continually amazed at the latest huge estate to have gone up in the middle of nowhere. It is one big economic mess, even compared to over here.

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http://www.bloomberg.com/news/2010-10-04/irish-house-prices-fall-market-not-yet-at-bottom-report-says.html

37% down having quadrupled? I would say they have a looong way to go down yet.

Houses have quadrupled. They double every 18-20 years, same as the general price level, given our inflating central banks.

If you want to get from x4 to just x2, you need to halve house prices, so the bubble has peaked and popped over the 18-year cycle.

Halving house prices means 50% off the peak price.

They're at -37% from peak. We have 13% to go.

Barring any undershoot, we should be there in 12-18 months time. You should also factor in inflation, which should fall throughout 2011 but start rising again in 2012/2013 and beyond. I'm not sure you'll see much nominal price reduction beyond 2012.

Edited by AvidFan

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What goes up etc.

I envy the people of Ireland. Soon they will be able to buy shelter for their family at true worth and have a good amount of disposable income after housing costs to enjoy their lifes. (if they have jobs)

It seems that in the UK, everyone still wants to spend a huge proportion of the fruits of their labour on keeping the rain off their heads.

Edited by Reck B

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I am convinced that we all should go over there and buy up one of these estates.

Good pubs.

We can globally make idiots of ourselves and people will go "Oh, they're Irish!".

We can come back to the UK, work, make money and do a runner before paying tax.

It would then be easy for us to get visas to live and work in the US.

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its a total mess and very unlike the uk , you only have to see how many estates have been thrown up in the last 10 years of expensive houses long distances from Dublin,

However what they have built tends to be of very high quality compared to most of the cr@p thrown up in England, The scale of luxury of fancy hotels in small towns in the middle of nowhere also beggars belief.

As a UK citizen you can also go and live there as a Non dom, and pay zero tax on ofshore earnings/assets , I suspect a lot of Brits will realize that life on a golf course in Eire is actually a lot cheaper and better quality than over on the costas and they can enjoy the local culture much easier too

I think country will have its massive collapse and then bounce back and have a much more efficient economy than the UK which will still be in denial in 5-10 years, they are taking the real pain now rather than kicking the can down the road like the UK...

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Houses have quadrupled. They double every 18-20 years, same as the general price level, given our inflating central banks.

If you want to get from x4 to just x2, you need to halve house prices, so the bubble has peaked and popped over the 18-year cycle.

Halving house prices means 50% off the peak price.

They're at -37% from peak. We have 13% to go.

Barring any undershoot, we should be there in 12-18 months time. You should also factor in inflation, which should fall throughout 2011 but start rising again in 2012/2013 and beyond. I'm not sure you'll see much nominal price reduction beyond 2012.

I think that's the wrong way to look at it, people pay their mortgages with wages and not percentages. With the average price at €195k and Irish wages falling fast, prices have a lot further to fall. I wouldn't be too surprised to see them at €70-80k in a few years.

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I wonder if they'll see the Eire of their ways.

Unfortunately I can't see a repeat of Ireland in the U.K. housing market, as the over-supply their is huge. I go over 3 or 4 times a year and over the last decade I have been continually amazed at the latest huge estate to have gone up in the middle of nowhere. It is one big economic mess, even compared to over here.

It is bank lending that really determines house prices.

If no mortgages were available, what would happen to the price of housing?

The price would revert to a cash basis.

IMO, house prices are really based upon the supply of credit.

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Houses have quadrupled. They double every 18-20 years, same as the general price level, given our inflating central banks.

If you want to get from x4 to just x2, you need to halve house prices, so the bubble has peaked and popped over the 18-year cycle.

Halving house prices means 50% off the peak price.

They're at -37% from peak. We have 13% to go.

Barring any undershoot, we should be there in 12-18 months time. You should also factor in inflation, which should fall throughout 2011 but start rising again in 2012/2013 and beyond. I'm not sure you'll see much nominal price reduction beyond 2012.

You should also factor in inflation

What.... again?? Youve already accounted for (according to your own reckoning) 18-20 years of inflation even though the period under scrutiny is only 13 years. Now you want to take inflation into account again!!!

Look at the figures. e195k for the average house even though the economy is screwed -and remember, monetary policies are set for whatever suits Germany and France - not the Irish property market vested interest groups!

Edited by Caveat Mortgagor

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As a UK citizen you can also go and live there as a Non dom, and pay zero tax on ofshore earnings/assets , I suspect a lot of Brits will realize that life on a golf course in Eire is actually a lot cheaper and better quality than over on the costas and they can enjoy the local culture much easier too

Is there any way to take advantage of that now?

e.g. Move to Ireland, but work in London Monday to Friday on a contract basis? Would that offer any significant tax advantages?

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Is there any way to take advantage of that now?

e.g. Move to Ireland, but work in London Monday to Friday on a contract basis? Would that offer any significant tax advantages?

Might be. Income tax tends to be lower in the ROI but the cost of liveing is deffo much higher what with higher VAT, much higher minimum wage, silly green taxes like 30 cents for a plastic bag, cost of gas ane leccy being higher as the semi stae prividers have always been seen to be as much creaters of jobs as anything else and the cost of running a car much higher. And you do need a car in the ROI.

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  • 259 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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