Is The Crash Is Over In Northern Ireland? Have We Have Reached (And Passed) The Bottom?

[2buyornot2buy]

I think that is harsh. whether we like it or not a house is an asset, if maintained will last quite a while and can be passed on to the next generation. therefore a fall in the value of this asset is, to the owner unwelcome.

A house price that covers today's building costs and a fair value for the land, and then rising with inflation is the ideal. however, as we know they then to overshoot, fall and then undershoot before rising again.

Sorry No. A house is a liability, you have to pay to maintain it, pay annual tax on it and it degrades over time.

today's building costs

No because the reason todays building cost are so high is because a legacy of higher than inflation housing cost along with money printing and currency devaluation have made it necessary you to need to pay too high wages, pay too much for materials and expect too much profit.

It’s a vicious circle jerk.

There is nothing healthy about the situation above. It’s destructive to society.

[yadayada]

. the RoI, for example, has performed very well as a nation, if you exclude the banking losses that the country under writ.

.

Good heavens. Do you read the papers?

Similarly, United performed very well against City the other day, apart from getting thrashed.

[2buyornot2buy]

I don't think the salesman cares as long as he sells the house. yes he gets a fraction more if he sells the house for a few thousand more but at the moment he is a broker man between a buyer and seller and trying to get agreement on both sides.

But yos the economy seams to measure itself, in an increasing way by house prices. I guess a large part of the equity of the country is tied up in houses. the RoI, for example, has performed very well as a nation, if you exclude the banking losses that the country under writ.

The other thing you have to look at is FTBers, who are the people who benefit from falling house prices. I cant remember the numbers but thats probably 4,000 or 5,000 people in Ni per year. That has to be balanced by the other 500,000 people who own their own houses. many of this people will not be happy with continuing falling house prices. You can disagree with that but I would consider that most are happier that house price falls have appeared to have stopped.

The banks, who appear to run the country can perhaps stare to breath again when house prices stop falling.

I myself am happier selling houses at £130k than £200k. As land prices rise to absorb the surplus there is no real benefit to me for prices to rise anywhere near where they were.

This is perhaps one of the most pointless posts I've read on the forum in some time.

This part in particular makes me think you didn't reread what you write.

I guess a large part of the equity of the country is tied up in houses. the RoI, for example, has performed very well as a nation, if you exclude the banking losses that the country under writ.

Sometimes I think you actually might believe what you say, and then it passes. No-one could be that short-sighted. No one, with children, could want to seriously want to **** their future up that much. Then I realise, it’s not their future you’re willing to mess up, it’s everyone else’s.

[2buyornot2buy]

PS, I like you BVI.

You're consistent. If a little transparent.

[Ausdave]

Eh a house is "consumable" over its lifetime. It has to be maintained and eventually rebuilt.

Willie is saying why does one form of price inflation make you "happy" when most other do not.

Answer = Inherent selfishness. If I can see myself getting relatively richer, screw the rest of you and the long-term competitiveness of NI PLC. Short-term selfish profit over long-term survival.

I think we even despised the banks for such thinking.

I do enjoy these discussions, - c'mon it's a bit of a push to state that a house is a consumable in the same way as food, energy or petrol.

With maintenance, upkeep, and yes taxes aside , it can be sold on after use. At a profit or at a loss.

Good luck burning your petrol and then selling on the remaining volatile hydrocarbons and CO2 byproduct.

I work, pay taxes and try to make a better life for my family.

If I can sell on property in the future at a profit I will - does that make me inherently selfish - possibly/ probably in your eyes but I don't see it like that.

Am I honest about that? Yes. Are the rest of you - doubt it.

[2buyornot2buy]

I do enjoy these discussions, - c'mon it's a bit of a push to state that a house is a consumable in the same way as food, energy or petrol.

With maintenance, upkeep, and yes taxes aside , it can be sold on after use. At a profit or at a loss.

Good luck burning your petrol and then selling on the remaining volatile hydrocarbons and CO2 byproduct.

I work, pay taxes and try to make a better life for my family.

If I can sell on property in the future at a profit I will - does that make me inherently selfish - possibly/ probably in your eyes but I don't see it like that.

Am I honest about that? Yes. Are the rest of you - doubt it.

Petrol, food and energy can be used to produce actual value added assets. You dont need to sell the used hydrocarbons when you've used the engery to build something.

The point I was making was that a house has costs and needs to be eventually rebuilt. It doesn't just sit there costing nothing. Its a liability.

Yada made the point perfectly in their post. One form of inflation is good because you directly benefit. Others are bad because you don't. Honestly.

[BelfastVI]

Sorry No. A house is a liability, you have to pay to maintain it, pay annual tax on it and it degrades over time.

No because the reason todays building cost are so high is because a legacy of higher than inflation housing cost along with money printing and currency devaluation have made it necessary you to need to pay too high wages, pay too much for materials and expect too much profit.

Building costs are building costs and nothing to do with the legacy of house prices in the past or printing money or profit. It is the physical cost of constructing the dwelling. I understood the argument was that there was no real wage inflation.

I believe property is an asset class. It has to be paid for and maintained but is an asset that can be passed on to the next generation.

[BelfastVI]

Good heavens. Do you read the papers?

Similarly, United performed very well against City the other day, apart from getting thrashed.

I do read alot of the papers. The RoI manufacturing and exports have performed very well, much better than NI. If it wasn't for the complete banking/property mess they would be doing quite well.

[BelfastVI]

This is perhaps one of the most pointless posts I've read on the forum in some time.

This part in particular makes me think you didn't reread what you write.

Sometimes I think you actually might believe what you say, and then it passes. No-one could be that short-sighted. No one, with children, could want to seriously want to **** their future up that much. Then I realise, it’s not their future you’re willing to mess up, it’s everyone else’s.

Please explain

[yadayada]

I do read alot of the papers. The RoI manufacturing and exports have performed very well, much better than NI. If it wasn't for the complete banking/property mess they would be doing quite well.

A lot of people would be outrageously rich had it not been for a property crash. Or as Putin famously said if your granny had balls she'd be your grandad.

[Belfast Boy]

This may be the nominal bottom. When will we see the true bottom?

Are house prices still falling when adjusted for inflation?

Maybe that is what the money printing and historically low BoE interest rates are about - stopping nominal falls above their historical norms.

The true bottom for house prices may be many years away still.

[Killer Bunny]

Nolan 14 August

[BelfastVI]

This may be the nominal bottom. When will we see the true bottom?

Are house prices still falling when adjusted for inflation?

Maybe that is what the money printing and historically low BoE interest rates are about - stopping nominal falls above their historical norms.

The true bottom for house prices may be many years away still.

Your argument is if house prices remain static or rise at a rate less than inflation they would, in real terms still be falling. I would agree with that statement. Only time will tell if that is the case.

House prices rising at or just below the rate of inflation is an attractive proposal. In real terms they are (in NI) remaining at their affordable level, yet for public sentiment they are growing. Keeping it at that level is another thing altogether.

[paulw0t]

Your argument is if house prices remain static or rise at a rate less than inflation they would, in real terms still be falling. I would agree with that statement. Only time will tell if that is the case.

House prices rising at or just below the rate of inflation is an attractive proposal. In real terms they are (in NI) remaining at their affordable level, yet for public sentiment they are growing. Keeping it at that level is another thing altogether.

This arguement only becomes helpful if wages are rising with inflation, This doesn't appear to be the case at the moment.

[BelfastVI]

This arguement only becomes helpful if wages are rising with inflation, This doesn't appear to be the case at the moment.

agreed

[Belfast Boy]

This argument only becomes helpful if wages are rising with inflation. This doesn't appear to be the case at the moment.

Incomes and savings are falling in real terms, yet house prices are rising? Just shows how dependent asset values have become on debt inflation rather than income inflation.

AFAIK the 90's crash lasted for 6 years. BelfastVI, I think it was you that pointed out to me that there were 3 years of nominal falls then 3 years of inflation adjusted falls.

How long will house prices continue to fall this time in real terms?

[Sogy]

Or as Putin famously said if your granny had balls she'd be your grandad.

The asshole just quoted a very common Russian saying.

[yadayada]

The asshole just quoted a very common Russian saying.

Did he? Sorry - I actually regretted writing something so crude.

How about "if we had some bacon, we could have bacon and eggs, if we had any eggs" instead?

The point being counterfactual argument is a pointless waste of time.

I met a pig farmer last week who'd just sold some boars to a farm outside Moscow which has an astonishing 30,000 sows. Who owns it? Putin's brother.

Edited October 2, 2013 by yadayada

[BelfastVI]

Incomes and savings are falling in real terms, yet house prices are rising? Just shows how dependent asset values have become on debt inflation rather than income inflation.

AFAIK the 90's crash lasted for 6 years. BelfastVI, I think it was you that pointed out to me that there were 3 years of nominal falls then 3 years of inflation adjusted falls.

How long will house prices continue to fall this time in real terms?

Price increases of less than 3% PA could be considered falls in Real Terms. My gut feeling is, if we do get a year of 3% increases it will be difficult to hold increases at that level and stop it increasing by more. That may seam a bit far fetched considering the past 6 years but the public react to rising prices and the lenders react to rising prices, both in a way that acts to further increase prices. We experienced the exact opposite on the way down. It could well be too early to discuss this.

[Belfast Boy]

Price increases of less than 3% PA could be considered falls in Real Terms. My gut feeling is, if we do get a year of 3% increases it will be difficult to hold increases at that level and stop it increasing by more. That may seam a bit far fetched considering the past 6 years but the public react to rising prices and the lenders react to rising prices, both in a way that acts to further increase prices. We experienced the exact opposite on the way down. It could well be too early to discuss this.

... when will the next boom start?

I think we have some serious economic issues to sort out before another boom is possible.

However, it will be fascinating to watch what effect the latest government 'help to sell' scheme has.

[sophia]

I think we all learned some valuable lessons from the house crash. Even my parents in their 60's who were so excited when their house was going up and up, now see how the market crash has affected the younger generation so negatively and do not want a return to the high prices.

I am a home owner and dread the idea of my property going up in price. I fear for my children and how they will make their way in life....the older generation has shafted us all I'm afraid.

Gone are the days when you could just walk into a job, these are the hardest days and worse to come.

I work in the social work field and I can tell you things out there are very very bleak...... there are no jobs, society here is broken down, suicide rates through the roof. Wake up and smell the coffee people........ greed = poverty.

[Ausdave]

Things are definitely looking up for the housing market.

http://www.propertynews.com/Property/Belfast/MCCMCC0276/77-Stockmans-Lane/246561242/

[dieselfreak]

I think we all learned some valuable lessons from the house crash. Even my parents in their 60's who were so excited when their house was going up and up, now see how the market crash has affected the younger generation so negatively and do not want a return to the high prices.

I am a home owner and dread the idea of my property going up in price. I fear for my children and how they will make their way in life....the older generation has shafted us all I'm afraid.

Gone are the days when you could just walk into a job, these are the hardest days and worse to come.

I work in the social work field and I can tell you things out there are very very bleak...... there are no jobs, society here is broken down, suicide rates through the roof. Wake up and smell the coffee people........ greed = poverty.

Couldn't agree more, i mentioned in the boom that i hated watching a similar house of my sell for some stupidly high price...

[JoeDavola]

From what I'm seeing, things in Central/South Belfast are selling very quickly.

Think I missed the bottom, and there seems to be a steady supply of people willing to pay a lot to live in those areas.

[djw]

From what I'm seeing, things in Central/South Belfast are selling very quickly.

Think I missed the bottom, and there seems to be a steady supply of people willing to pay a lot to live in those areas.

I think you're right. Probably a lot of buyers who have been waiting since 2007. Makes it easy for EAs to sell when so little supply in these areas and general consensus is crash over, come on in the waters lovely....

Think ill wait for a while yet. I'm still net bear.