What are people’s opinion on the following: If you were able to get a property at say 20% less than the asking price (obviously a reliable valuation would be the benchmark) is it still lunacy to buy now?
the market has come down significantly and the likelihood of a further 20% reduction is not that high. So in that case would it make sense? I want to know just how bearish you lot are!
Depends on the property. There are many developments of apartments that some of us rank as utterly undesirable and overpriced far in excess of 20% or even 40%.
I still see no reason to think of buying for the next 18 months or so. But then I have no real urge to anyway, ignoring prices.
I think another 20% is pretty much inevitable.
I don’t know about timing the bottom (as in I don’t know when one would expect to call it), but since AIB say they see no chance of a recovery before 2009 “at the earliest”, you would be mad to buy until then. If the big drop has happened already, 15% as AIB call it, there is still plenty of scope for forced sales to drive prices further down (as they may be the only sales happening in some areas), so you would be crackers to buy now. Given that another thread sees the likelihood of an Irish recession with an attendant employment shock, you would be bonkers to buy unless you’re rock-sure of your employment.
Mad, crackers and bonkers. Is that lunacy enough for you?!
On what do you base that projection?
In my never humble opinion, a drop of 20% within the next year appears more likely than the drop over the last year appeared at the same time last year.
Both external factors and momentum are against the market (neither were from the public POV at the start of 2007), and it’s about to eat its own tail by shutting down supply.
As kosh would say, The avalanche has started, it is too late for the pebbles to vote.
If you are asking “do you think it is possible that something comparable could be available cheaper in the not too distant future” the answer is yes.
Taking your question as read I would say: depends
Depends on your personal circumstances
depends on your financial circumstances
depends on the property
depends on your risk aversion
etc. etc.
I base it on the market having taken about a 15-20% dip already, a further 20% would be more akin to a depression than a recession and i don’t think we are headed for a depression.
so a further 20% is not that likely in my opinion.
yoganmahew: point taken! throw in a pinch of quirkiness for the craic too!
Well, given the huge extent of overvaluation here, the impending recession, the lack of control of our interest rates, the global credit crunch, and the fact that recent population inflows seem to be reversing and our own demographics mean demand will be slackening, I personally reckon we’re going Japanese. I don’t think prices will get back to their real peak ever again, and I think they have a long way to fall from here still.
A further 30%-40% over the next 3-4 years. Btw, I don’t believe prices are down by 20%, more likely 10-15% maximum. 20% has been used by the VIs as it suits them now - 20% down, so buy sooner rather than later.
The ISEQ today is down 35% from it’s peak 12 months ago. Some of the financial components are down almost 50% from their peak.
Why do you think that property is somehow immune from similar falls?
I would argue that property was more over-valued at it’s peak than the ISEQ and is therefore in line for a bigger fall.
If I was able to get any of the houses that I’ve been following at 20% off what they are currently advertised for, I’d definitely buy now.
I think it’s unlikely that 3-4 bed houses in North Dublin, near Dart line, will drop much more than that.
I’d consider the recent 15-20% drop to be just irrational boominess scaling back to regular boominess - developers are still doing quite nicely (if they can shift the units).
We’ve yet to see breakeven sales from the developers, nor the effect of cost reductions from wage rates dropping being passed on, never mind the effect of pent-up supply being dumped onto the market as specuvestors cover the ‘over-long’ positions and the majority of developers being forced to clear their inventories.
When this happens the supply will rip through demand, while potential demand considers whether they’ll still have a job in 6 months, never mind 35 years, and whether they can find a bank which will give them 300K+.
Call it what you will, history offers no examples of what ireland is about to face.
Just because a further 20% fall would be more akin to a depression doesn’t make it any less likely to happen.
A further 20% would probably tempt be back into the market.
Even after properties have dropped another 38% plus - be a bear.
Be very a bear. 
If we look at it like weight loss for a fat person
If I am 5ft10 and weigh 30 stone and I lose 20% of my body weight then even though I have done extremely well and lost 6 stone I am still morbidly obese.
If I am 5ft 10 and weigh 15 stone 20% brings me down to 12 stone which is probably a reasonable weight.
In my view Porky needs to keep up the laxatives before we hit a healthy BMI.
I am following what happens in the US (Florida) and I think Ireland will be in for a worse time. So judging by the US the prices, falls are only starting. I want to get a gaff and I will not be willing to wait for the bottom as the bottom is 4 years away at least. So I will be looking to add in say 8 months of drops to anything I buy. I will be potentially looking to buy at the end of the Summer. I doubt anybody will factor in eight months of drops into the price I agree to buy their house. So I will be looking for firesales. I will also concurrently be making several low offers on houses. I will allow the sellers to think I’m going through and at the last minute I’ll Uzump(or what every it is called). One or two out of seven will surly be desperate enough to accept my new terms. If not, I’ll start again.
We are still more than 50% above historical house price trends [1]. Assuming we get anything approaching a reversion to the long term mean, there is a lot more than 20% to come off yet.
Yes it does Uruguay.
Now, now. No need to question the man’s sexuality just because you disagree with him BB 
Some properties have dropped their prices 20%, not the overall market. Avg. prices are down between 5% and 7% depending on which survey you look at.
It is quite possible that individual properties could drop by 50% or more (though not the overall market) by the time this bottoms out.
The current VI spin is that prices have already collapsed so much, they can’t collapse any more. This is bullshit.