Marian Finnegan, Chief Economist, Sherry FitzGerald Group

sherryfitzgerald.ie/ABOUTUS/ … spx?id=518

The rate of reduction in the deceleration in the drop in the fall of prices is becoming less steep.

These numbers do not make any sense.

If Q1 2006 = 100 and Q3 2009 = 66 (44% reduction), then the reductions would have to be along the following lines:

Year Q Price Index Drop 2006 Q1 100.00 1.75% 2006 Q2 98.25 1.75% 2006 Q3 96.53 1.75% 2006 Q4 94.84 1.75% 2007 Q1 93.18 1.75% 2007 Q2 91.55 1.75% 2007 Q3 89.95 1.75% 2007 Q4 88.37 1.75% 2008 Q1 86.83 1.75% 2008 Q2 85.31 1.75% 2008 Q3 83.82 1.75% 2008 Q4 82.35 1.75% 2009 Q1 80.91 9.50% 2009 Q2 73.22 5.50% 2009 Q3 69.19 4.50%

A 9.5 %, 5.5% and a 4.5% reduction each quarter of 2009 would means that the prices at the end of Q3 2009 would be 81.67% of those at the start of the year.

A cumulative 44% reduction since Q1 2006 would have to mean much smaller drops for most of the previous quarters.

How do you know an estate agent is a liar? It breathes.

Speak English you daft bint.

Let me help you.

House prices kept falling all Summer Long, but that’s ok because falling is the correct direction for them to be going.

Although they kept “correcting”, they weren’t “correcting” as quickly as previously.
This means we’re moving in the right direction less quickly than we could be,
so it’s going to take longer than expected to get there.

But we will get there.

Or for the Executive Summary:

Anyone who believed any of the stuff I said about Soft Landings is screwed.

See Marian. That wasn’t so hard.

-Rd

Is this the first time that a commentator has gone to the fourth derivative to describe Property Prices? :stuck_out_tongue:

First Derivative:
“the decline”

Second Derivative:
“the rate of decline”

Third Derivative:
“the rate of decline moderated”

Fourth Derivative:
“the rate of decline moderated further”

The most recent “moderation” of prices was 1% (from 5.5 to 4.5), the previous one was 4% (from 9.5 to 5.5), so therefore the data point before that had to be at least 4% greater than 9.5% (in absolute terms) if we are to believe that "“the rate of decline moderated further
So Q4 2008 had to have fallen by at least 13.5% for her statement to make sense. Which come to think of it, is not too far off the mark, which leads me to believe that Marian Finnegan is somewhat of a mathematical genius toying with us mere mortals.

And while I’m being pedantic, let me correct jxdr:

Ignoring inflation, a 44% reduction from a base of 100 is 56 (and not 66). Which implies a decline per quarter of 3.6% (or 2.2% if you include the 13.5% figure). This doesn’t seem that unreasonable to me?

A pinster, a mathematician,and a biologist are sitting in a street cafe watching people going in and coming out of an Estate Agent’s shop. First they see two people going into the shop. Time passes. After a while they notice three people coming out of the shop.

The biologists: “They have reproduced”.
The pinster: “The Estate Agent was lying about how many went in to the shop.”
The mathematician: “If now exactly one person enters the shop then it will be empty again.”

:smiley: Dats funny.

Speaking as a mathematician that made me laugh

Given all the faffing about with derivatives, it’s pretty obvious now how
Sherry Fitz managed to lose so much money.

-Rd

Sorry - my calculations were inexcusably wrong. They should be:

Year Q Start of Q Drop End of Q 2006 Q1 100.00 3.10% 96.90 2006 Q2 96.90 3.10% 93.90 2006 Q3 93.90 3.10% 90.99 2006 Q4 90.99 3.10% 88.16 2007 Q1 88.16 3.10% 85.43 2007 Q2 85.43 3.10% 82.78 2007 Q3 82.78 3.10% 80.22 2007 Q4 80.22 3.10% 77.73 2008 Q1 77.73 3.10% 75.32 2008 Q2 75.32 3.10% 72.99 2008 Q3 72.99 3.10% 70.72 2008 Q4 70.72 3.10% 68.53 2009 Q1 68.53 9.50% 62.02 2009 Q2 62.02 5.50% 58.61 2009 Q3 58.61 4.50% 55.97

But still, given the alleged numbers, the previous quarter price drops had to be of the order of 3.1% on average to get from 100 in Q1 2006 to 56 in Q3 2009 - much lower than those in the last three quarters when the drops are supposed to be “moderating”.

Three successive descreases of 9.5%, 5.5% and 4.5% is a cumulative drop of 18.3%.

Finally the rate of decrease will obviously drop at the culumative drop increases. This is simply common sense as there is simply less to fall.

Price Drop €1,000,000 €0 €969,000 €31,000 €938,961 €30,039 €909,853 €29,108 €881,648 €28,205 €854,317 €27,331 €827,833 €26,484 €802,170 €25,663 €777,303 €24,867 €753,206 €24,096 €729,857 €23,349 €707,231 €22,626 €685,307 €21,924 €620,203 €65,104 €586,092 €34,111

Also, given that there appears to be so many mathematicians lurking, can we not get someone to produce a sensible property valuation model?

WE probably can but Marian can’t . She is merely destined to produce these periodic Marian Finnegan Moments for our amusement .

This is why the WHo Said What thread will be a record for our times… is it lost or something because we have to keep it going.

Speaking here in 2006, “we (Ireland) really are the economic power house of Europe”

emea.mediasite.com/mediasite/Vie … c2fc35e6e3

Is she one of the coy 200 economists whispering in Brian Lenihan’s ear?

Finnegan was on Radio1 earlier around 1645 about how low house prices will go.
All about tons of cash buyers being out there at the moment and loads of sale agreeds.

That’s hilarious! :smiley: Great to see she is still asked her opinion on the national broadcaster :unamused:

There may well be - but if there were smart enough to hold onto their cash until now will they be so keen to rush in when all signs are pointing towards further declines through this year?

+1.
That’s the question.

I’m surprised she didn’t mention the 4% drop in Dublin houses per CSO for Jan meant it’s a wonderful time to buy right now…

You have to laugh … Marian is a pure Charlatan.

RTE must be some kind of broadcasting goldfish. Forgetting what each contributor says as soon as they leave the studio.

That’s why they have the same voices/faces all the time.

I’d say it’s inertia.

It’s damn right laziness.

We someone to talk on x. Pull out the address book for an old reliable. Doesn’t matter if it’s really their area of expertise or they’re any good, we just need filler

Yeah, that’s what I meant to be honest.