A look at cash buyers in Ireland


#1

Cash buyers: Who are they and how come there’s so many of them?
Central Bank chief Philip Lane says cash buyers limit ability to control house prices
irishtimes.com/business/per … -1.3224402

An interesting article on the cash buyer phenomena in Ireland. Some stats to backup the previously largely anecdotal evidence though this is mainly from just 1 EA.
But one things for sure, there’s still an awful lot of cash out there despite the record crash this country went through.


#2

Interesting… Cash buyers buying investment properties seems bizarre given the taxation regime on rental income unless of course they’re cash rich but income poor and would not be taxed at the marginal rate, i.e. retired or semi retired.

Could also be a trend amongst wealthier families to buy properties for children for college years given the current rental mess.

The big question I’d have is whether institutional investors would be considered cash buyers and if this is accounted for in the data?


#3

Would like to see the foreign, non-REIT element of this. Chinese flooded Oz, NZ & Canada to get money out of government reach. UK was also a target. To get a visa in the UK, they had to invest something like a million which was then doubled.

google.ie/amp/s/amp.theguard … ld-hits-2m

Ireland was the next target as it was cheaper and in the EU. We also upped the amount but it’s small fry compared to UK.

amp.independent.ie/business/iri … 87614.html


#4

Buy property in a pension.
Completely tax-free.


#5

Per mortgage lending falling off a cliff thread:

viewtopic.php?f=4&t=26451&p=912717&hilit=+Ixus#p912717

We went from 55% cash & 45% mortgages in 2013/14 to 37% cash & 63% mortgages Q4 2016. A function of rising prices and increased lending activity.


#6

Does anyone know, if someone borrows from abroad, does that get recorded here ?


#7

I’d presume if the loan is secured on a particular property * it has to be done via a regulated financial entity and would be but if a fund/HNWI borrows abroad for general [company] funding it wouldn’t be?

I have heard vaguely of private bankers arranging loans for property where the loan is secured on say shares ***


#8

Cash buyers have fallen from 52.3% in 2013 to 44.6% in 2016 - makes sense with rising prices


#9

Some interesting stats out of Savills today in relation to landlords and their mortgages (or lack of)

irishtimes.com/business/eco … -1.3314199


#10

independent.ie/business/per … 50497.html


#11

We know cash sales have been declining relative to mortgages in recent years but the Indo today suggests we are approaching a normal market in that respect:

independent.ie/business/per … 57508.html
The Central Bank restrictions are biting also at the lower end of the market: an Estate Agent’s Index shows no price increases for 3-bed Semis during Q4 2018 in about half of all areas in Ireland.

And:

Does the Indo congratulate the Central Bank on taking the steam out of the property market and keeping house prices within reach? 8)

In fairness, the Indo might have a point about seasonality which seems to go beyond the traditional slowdown:

But it doesn’t occur to the Indo that the banks should simply spread these exemptions over the full year.
Brexit is also blamed of course, but this is a complicated way of saying the British buyers are scarce: