I keep hearing that SSIA money is going to boost the housing market.
I know of nobody who is putting SSIA money into a new house or upgrading to a bigger house, and definately nobody thinking of buying a specuvestor house. I know people who have bought cars, converted rooms, gone on holidays etc.
Does anybody honestly think SSIA’s are going to help the housing market? I suspect that the SSIA’s were partly to blame for the peak last spring as people wanted to get their house bought before the SSIA effect kicked in, trouble is interest rate hikes kicked in even quicker.
Any couple who now have ~50k to play with are much better off investing in various bank accounts that are paying upto 7% than in the property bubble IMO.
The SSIA’s boosted the property market during the first half of 2006. I believe people borrowed against their SSIA’s out of fear of being priced out of the market when the SSIA’s matured on mass. This caused a sharp spike of up to 20% on YOY house prices. In the later half of 2006 some of this 20% gain was eroded due to interest rate increases and the sharpness of the price increases.
I do not believe the SSIA’s will have any further impact on the market.
Yes it looks like that alright, people who are still waiting are probbaly starting to think the very same thing and that wouldnaturally make them more cautious on spending it, especialy in a falling market.
Yep it slooks like the SSIA effect is, done and dusted!
The only subterfuge the vested interts have left is the SD/Election myth.
Trouble is that the trend so far is NOT to buy a house with it. The way I see it stressed savers will already have spent it by borrrowing off the parents or overmortgaging etc. once the cash comes in they will pay off the shortterm loan, everybody else will probably blow some of it and then save the rest of it and earn a yummy rate of interest on their nestegg.
If its spent on consumer goods like tv’s, furniture etc then the government gets 21% in the form of vat,if you buy a new car the government can get over 50% in the form of vat plus VRT.
Not to mention the fact that the savings are net of income tax anyway.
Can’t see any reason to assume much of the remaining 50% will go into property. Of the 50% of people still waiting to get their SSIA, how many are in the market for a house? And how many of those are now more cautious of the market than they might have been 1 or 2 years ago?
Average SSIA payout is what - 13K-ish? It’s not heading for the property market.
The max I’ve heard anyone getting from their SSIA is €21K, this kind of money won’t even cover a deposit in a lot of places! Also, for a lot of FTB’ers, they would have been in their late teens and early twenties, I don’t know too many students who were able to make significant or any payments to an SSIA five years ago.
anyone i ask has no intention of using their SSIA money on property,most have borrowed on the strenght of it so will be paying off loans ,mortgages or credit cards. i think peoples attitude to borrowing has shifted dramaticaly in the last 12 months and maybe ppl will start to think about lowering their debt
most people who are at the age to afford an SSIA when they started have already bought their houses. I think any effect that it has will have already been priced into the market. People have borrowed against them from banks or parents so I dont think it will make that much of a differnce. 20K is not going to make it that much easier to buy a house if you were not already able to. So I think it effect will be quite small.
My anecdotal feedback is that those who were planning on using their SSIAs spent the money back in late 2005/early 2006 before the release of the first SSIAs, as there were so many warnings in the press that SSIAs would drive up house prices. The VIs told everyone to “buy buy buy!” at that stage.
There was a consumer survey on the radio just now and about 8% of SSIA’ers are going to spend money on property, I assume this includes new windows, conservatories and extensions too, and a lot of them buying new homes will alreadyhave paid out deposits etc. so I can’t see this being the white knight to head off the collapse for another 6 or 12 months.
So the ssia money is to be kept in the bank accounts? With our massive level of personal debt it just shows that the ssia really benifited those with money
