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Dublin House Prices Heading For 100 Times Rent Earned

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A line frequently trotted out by estate agents is that "buy-to-let investors are not worried about rental yield; they are in it for the long haul of capital appreciation". That is fundamentally unsound investment advice. In the long run, the value of any asset is dependent on the income it provides.

http://firstrung.co.uk/articles.asp?pageid...articlekey=1575

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Guest Winners and Losers

Some of the articles coming out lately sound very HPC - like they have literally lifted stuff of this site. Maybe the journo's are visiting more than we think???

Sound familiar?

In the property market, capital appreciation is theoretically a function of rental return. What is buying a house in any case?It is the opportunity cost of not renting. An owner-occupier/investor is buying a discounted stream of rents for as long as he/she wishes to hold on to the asset. And vice-versa: a renter pays a monthly sum to a landlord rather than interest to a bank. The opportunity cost of not owning a home is forsaking the potential for a return on that investment. But if rents are relatively static, not only is the potential for capital appreciation reduced, it is also more attractive in cash-flow terms to pay rent rather than interest.

Edited by Winners and Losers

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Guest wrongmove

In the long run, the value of any asset is dependent on the income it provides.

Best avoid gold then. 1% yield looks good next to precious metals!

But I agree 1% yield on property is ridiculous. The staggering thing is though, that if you buy a place outright, it is probably as good as a savings account in the Eurozone. The buyers must be praying for HPI as much as we are praying for a correction.

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Best avoid gold then. 1% yield looks good next to precious metals!

But I agree 1% yield on property is ridiculous. The staggering thing is though, that if you buy a place outright, it is probably as good as a savings account in the Eurozone. The buyers must be praying for HPI as much as we are praying for a correction.

Yeah but a lot of this money is going abroad.

Secondly if they put 1/100th of this money into R+D or internal venture capital funds the country could sustain its strong technology position. But they dont, they choose to invest abroad and leave the place to rot.

The chickens will yet come home to roost in Ireland.....

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  • 301 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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