Realistbear Posted September 5, 2006 Report Share Posted September 5, 2006 (edited) http://www.bloomberg.com/apps/news?pid=206...&refer=home Irish Mania for Homeownership Squeezes Consumers as Rates Rise By Dara Doyle Sept. 5 (Bloomberg) -- Ken McKenzie, a university researcher in Dublin, is shelving his overseas holiday plans this year. He blames the European Central Bank for keeping him at home. ``I had been thinking about Istanbul, Stockholm or maybe Canada,'' says McKenzie, 30, who now spends 38 percent of his 2,500-euro ($3,215) monthly salary to pay an adjustable-rate mortgage. `` But with rates going up? Forget about it.'' In Ireland, where almost eight in 10 dwellings are owner- occupied, the frenzy for property is forcing many buyers to scrimp after prices quadrupled in a decade. The Irish central bank is concerned about a potential collapse as interest rates rise, pushing debt costs higher. That may leave western Europe's fastest-growing economy vulnerable to a slowdown. `` There's a sense of a bubble ,'' says Alan Barrett, senior economist at Dublin's Economic and Social Research Institute. `` One in eight workers are in construction . If there's a wobble, it gives you the potential for a big unemployment increase .'' Ireland and Spain are likely to be among the hardest hit as the ECB raises rates, according to a February report by JPMorgan Chase & Co. Spurred by record-low interest rates and falling unemployment, Irish house prices rose 335 percent to an average of 303,247 euros from 1995 to 2005, the fastest growth among 18 countries surveyed by the Paris-based Organization for Economic Cooperation and Development. Not a very diversified economy in Ireland then. Edited September 5, 2006 by Realistbear Quote Link to post Share on other sites
Gone baby gone Posted September 5, 2006 Report Share Posted September 5, 2006 Irish house prices rose 335 percent to an average of 303,247 euros from 1995 to 2005, the fastest growth among 18 countries surveyed by the Paris-based Organization for Economic Cooperation and Development. 335% in 10 years, holy chuffing sh1t!... Quote Link to post Share on other sites
GCS15 Posted September 5, 2006 Report Share Posted September 5, 2006 "In Ireland, where almost eight in 10 dwellings are owner- occupied, the frenzy for property is forcing many buyers to scrimp after prices quadrupled in a decade" Have wages quadrupled? "One in eight workers are in construction. If there's a wobble, it gives you the potential for a big unemployment increase.'' And if there is more than a wobble? I get so cranky when I think how much our so called "leaders" get paid. Quote Link to post Share on other sites
AssetIndigestion Posted September 5, 2006 Report Share Posted September 5, 2006 335% in 10 years, holy chuffing sh1t!... That's an average. There are large tracts of the capital, Dublin, that have easily bubbled up 1000% in 10 years. I often wonder why some big international hedge funds don't take an aggresive short interest in the Irish Banks. Perhaps they're waiting for a couple more rate hikes. Quote Link to post Share on other sites
fatso Posted September 5, 2006 Report Share Posted September 5, 2006 I've gone long on potatoes as well as kebabs. Poor old Irish thwt're about to suffer the mother of all crashes. fatso Quote Link to post Share on other sites
Michael Posted September 5, 2006 Report Share Posted September 5, 2006 (edited) the 335% raise in 10 years is ......around 16% pa compounded!!!!!!!!!!!!!!!!! so hps can rise 16% a year for that long!.....How much have Paddy's wages risen in this time?? The house building rate per million inhabitants is around ten times ours owing to laxer planning regs.... The problem was the introduction of the low Eurozone IRs just as Ireland needed higher IRs.. Brussels had done so much for the Irish they embraced and still embrace everything European including the Euro.... What the hell's going to happen when the German economy picks up speed and IRs rise just as the Irish economy weakens.....The Irish situation has been an accident waiting to happen and the government's done nothing..... Edited September 5, 2006 by Michael Quote Link to post Share on other sites
Caledonian-Emigre Posted September 5, 2006 Report Share Posted September 5, 2006 (edited) Ireland: From rags to riches .... and back again ! Well maybe that´s an exageration - but the good times are certainly coming to an end soon. Edited September 5, 2006 by Caledonian-Emigre Quote Link to post Share on other sites
Cuckoo Posted September 5, 2006 Report Share Posted September 5, 2006 Ireland: From rags to riches .... and back again ! Well maybe that´s an exageration - but the good times are certainly coming to an end soon. the situation in ireland is not good and hasn't been for a while. but it has made a lot of people very rich, and they have been pouring their property and construction money into safer areas, such as core central london commercial property investment market, so at least they will be protected from a possible downturn at home. as for the average jo, well, its potatoes for tea again! Quote Link to post Share on other sites
AssetIndigestion Posted September 5, 2006 Report Share Posted September 5, 2006 the 335% raise in 10 years is ......around 16% pa compounded!!!!!!!!!!!!!!!!! so hps can rise 16% a year for that long!.....How much have Paddy's wages risen in this time?? I think more than Taffy's and Jock's but not too sure about Limey's Quote Link to post Share on other sites
fatso Posted September 5, 2006 Report Share Posted September 5, 2006 the situation in ireland is not good and hasn't been for a while. but it has made a lot of people very rich, and they have been pouring their property and construction money into safer areas, such as core central london commercial property investment market, so at least they will be protected from a possible downturn at home. as for the average jo, well, its potatoes for tea again! and a lot of them haven't and are going to become very poor! Go back to wan king under your bridge - troll. Quote Link to post Share on other sites
Cuckoo Posted September 5, 2006 Report Share Posted September 5, 2006 and a lot of them haven't and are going to become very poor! Go back to wan king under your bridge - troll. juan ker! Quote Link to post Share on other sites
fatso Posted September 5, 2006 Report Share Posted September 5, 2006 juan ker! Funny - last time I saw you, you had a pencil stuck up your @rse - looks like it's penetrated your brain. Quote Link to post Share on other sites
slurms mackenzie Posted September 5, 2006 Report Share Posted September 5, 2006 One in eight! Blimey. Surely they'll run out of things to build? Or they'll have to carry on building and prices will come down. Quote Link to post Share on other sites
ronnie Posted September 5, 2006 Report Share Posted September 5, 2006 I have my escape plan ready, will be heading for london or manchester on the ferry when the inevitable crash comes. trying to get a job in irish civil serice at moment which would at least give job security in a downturn. Quote Link to post Share on other sites
Michael Posted September 5, 2006 Report Share Posted September 5, 2006 (edited) Ave Hp in Ireland is 303k euros..(£216k!). up from about £50k 10 years ago ...ave in Dublin is 409k euros(£292k!) Paddy's gone stark raving mad.....I bet even all of the bulls on HPC like Cuckoo and the gang would class this as a bubble......... way ahead of anything in the uk and London apart from ghastly new build Travelodge-style flats of course..... Edited September 6, 2006 by Michael Quote Link to post Share on other sites
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.