the Big Supply Squeeze is on (Mark Keenan)

Keenan you can’t be allowed to get away with writing such lurid pornography.
You should be ashamed of yourself trying to con the uninformed into buying in a crashing property market.

1 ) Keenan offers a Table with property supply for the year of 2007. His first argument is that supply is tightening based on this table. During peak selling season supply is 4550 for Dublin. Then in December supply drops to 3954.

Keenan. Most sellers will not go to the expense of advertising their homes in December as the market shuts down for Xmas. Why don’t you point this out? This in effect makes your first conclusion absolute rubbish at best, lies at worst.

2 ) Keenan points out that EAs have told him appointments increased after the budget. He doesn’t qualify this with figures nor does he see the need to have proof considering it is in the EAs interest to convince people that the market is improving. Without backing of hard evidence his point here is absolute rubbish at best.

3 ) He says letting figures show rents are continuing to rise. We have plenty of proof on the pin to counter that claim. Once again he doesn’t qualify his claim with any facts so he could be talking about last years rents in which case he may be right. However, we at the pin are ahead of the curve and we, unlike Keenan offer proof. Also have a look at our friends over at treesdontgrowtothesky.com/. These guys now compile a rental drops and rises list along with the Pins Verbatim.

4 ) Keenan the genius points out that
“The law of supply and demand tells us that when supply gets tight, prices go up. And when prices have been falling as they have, scarcity can arrest the downward price trend”
Now he uses this to say the December supply shortage will “arrest the downward price trend”. Very clever. He is correct for the supply part but he fails to realise that the demand part of the law is also of some importance. Since demand in December drops will negate the supply effect Mr Keenan really starts to look stupid.

5 ) Keenan interviews no neutral parties for his column. He does talk to Paul Murgatroyd of The EA Douglas Newman Good. They say
“Stronger rents have encouraged them to put their homes into short lets of six months to a year, with the idea of comming back to the market at a later date. The fact that that the supply of rental property has increased in the same period would also back this up”
Keenan’s job here would be to rip this silly statement apart. He doesn’t so I will.

Using Keenan’s law of supply and demand, as more and more unsaleable properties are added to the already busting rental supply we know that high rents will get no tenants and rents will have to decrease. As rents fall current tenants will find it harder and harder to justify paying their rents which were agreed before the bloated supply. So naturally they will demand a reduction in their rents or they will move to a similar property with lower rent. Rents will continue dropping until supply equals demand. this means some of these new LL will have to withdraw their property from the rental market and put it back up for sale. Now the kick in the teeth here is the fact that it will probably take the seller 6 months to face the hard truths and by that stage they will have lost 6 months rent and the price they could have got for their property (although significantly lower than their expectation) 6 months ago will be significantly lower that what they will get when they do capitulate and sell.
Now lets be fair. We need to sympathize with the seller. They aren’t bad guys. They, naturally just want the best price for their property. Their loss due to bad information can be attributed to the ill informed or deceitful public commentators.

6 ) There is more rubbish but I’ll end it here. Maybe someone else can lift the torch.

Finally. Keenan ends with
“But in their absence I think 2008 will mark the turn in the market and we can anticipate a return to slight growth by the end of the year”

In order to say this Keenan must have a supernatural ability to ignore all economic happenings both in this country, in the countries of our main trading partners and the general imbalances in the world. He also puts himself forward as a smarter man than most top investment bank economists, the gentlemen of the ECB, Mr Alan Greenspan, not to mention our resident Pin economists.
In one foul stroke Keenan has truly joined Desperate Dan, Comical Austin, and Laughable Liz. Welcome on board Mark. :unamused:

This article is an absolute disgrace!! Disgusting, even.

The table does not agree to daftwatch.ie, he does not mention any seasonal effects, does not show comparable 2006 figures, and generally uses figures to prove what is effectively an incorrect conclusion, that supply is contracting to meet demand and prices will rise as a consequence

He does not tell us how many of the properties were sold or just withdrawn, effectively assuming they were sold, he only compares the stock at the seasonally low December to the the peak in the summer rather than the previous seasonally low December which would have emphasised how HIGH the December 2007 inventory is. He does not comment on the current inventory as at 20 January 2008 which is higher again.

He does not comment on the (also readily available) stock of properties for rent, which pretty much negates his whole argument

:imp:

Do you think this is an attempt to woo advertisers (ie estate agents), because if you look through the supplement, there are no advertisements at all for second hand houses, and only one full page ad for Irish property for some units at Ballintyre near Dundrum (which are ludicruosly over-priced)

Always bear in mind that, in many cases, journalists (or columnists) dont decide what to write. They get told by their editors, who in turn, could well be told by their proprietors.

Journalists know when they write bullshit, but bullshit pays the bills, honesty doesnt always.

Im NOT saying this is the case here, but when a paper suddenly changes tact on issues such as property to politicians, isnt it a bit odd that all the columnists follow suit in tandem ?

Good point.

The Sunday Times were the first to actually report the real happenings in the Irish property market about 8 months back.
After they did this, Mark Keenan reported that numerous estate agents and builders rang up the Sunday Times office and screamed down the phone at them. Maybe Keenan is making recompense. This is still no excuse for the tripe he has written.

This is the second week in a row that they’ve printed tripe like this. Last week it was “prices are as low as they’re going to get”.

There wasn’t a little tagline at the end of the ‘article’ was there ?

Something like, “This article has be brought to you by the CIF !” :slight_smile:

Keenan must have been smoking something before writing that article. Either that or there is an ulterior motive going on as has been alluded to already in this thread. Then again he could soberly actually believe what he has printed, which makes me vision him as like the guy in the omen that had pages of the bible all over the walls of his room to ward off evil. Picture Keenan surrounded with his walls covered with the ramblings of comical, dan and the rest.

The thing that gets me though when we see continued utter property drivell like this either being printed or broadcasted is that there are still many people out there that will unquestioningly take on board his point of view because he is telling many what they want to hear. In a separate article I read this morning in the Mail (I swear I only bought it for the Jean Michele Jarre CD!) our esteemed leader is reported as going to stay on in power until the start of 09 when the economy will be back on track! Sweet Jeepers :unamused:

We all knew here that the usual suspects would inevitably round up the wagons to counter the negativity. Prepare yourself for the forseeable future to messages of recovery just around the corner and property price drops compared to the capital appretiation seen over the decade of gouging at the trough.

If I was a house builder (or a group of house builders) with an overhang of inventory I was looking to shift; and was faced with stiff competition from a veritable hoard of private sellers, coming up to the peak selling season. I might be tempted to ‘create the impression’ that these private sellers should hang tough and knock back low ball offers, in the expectation that the market will recover later in the year. You know clear the field, let the dog see the rabbit etc.

Hey I might even say to the papers I advertise with that I’ll be putting a lot of business their way, but that I’d need a fair bit of favourable copy to pump prime the market prior to the blitzkrieg. Now call me cynical if you like. :confused:

Do you have any raised birthmarks under your hair just behind your left ear? I think you should check :smiley:

It’s a strange article and the content is poles apart from the opinions emanating from his objective weekly ‘market’ column in the home section of the same paper. That’s Journos for ye, always an angle.
I see Morgan Kelly wants the government to scrap stamp duty, (today’s indo), good to see that back on the agenda :unamused:

The man is somehow deluded.

He may not know that we had 300,000 empty homes at the time of census 2006 .

He may not have bought a calculator in the 2 Euro shop and plotted out some likely numbers for the present day. I fail to see how it could be any less than 350,000 myself , right now.

If he did NOT know this fact then his entire article falls flat on its face.

I he does know this then he knowingly lied. I remember Country Tom started to rant loudly across Matt Cooper on Q and A last week when Matt mentioned that 2006 census statistic.

Obviously this fact is the elephant farting loudly and pooh poohing giant stinky turds in the corner of Country Toms office when he goes to work every ( other) day.

What can I say except to repeat yet again .

*****Its The Empties Stoopid ***** .

Everything in Ireland is about the empties. . No other country has such a massive surplus of unwanted homes and we are only committed to knocking a few in Limerick so far.

Just to put this whole empties situation in context the comparative figure for the UK is 3% - less than 1/5th of our 16% 2006 census figure. The UK figure is comparable, they have holidays homes as well (incl. half of Cornwall, Scotland and the Lake District etc) plus a good bit of London property are second homes for work for both domestic residents and foreign business people. Canny Mc Savvy no doubt has a London pad he uses once every few weeks.

Still, there’s also a fair bit of pent-up demand. I’m in my late twenties, and I have a good number of friends in their mid-twenties on who are still in shared rental accommodation, despite being paid what should be an OK wage - it’s just prohibitively dear to buy or rent on your own if you’re in the 40kish bracket.

In any other country in Europe most of us would be past that stage and into a place on our own or with just a partner. I’m watching rents myself and as soon as there’s an appreciable downward move I’ll be getting a place to myself, sick of sharing!

Anyway, my point is the unwinding of the house-sharing phase of the Pope’s Children will potentially soak up a portion of the overhang. Not all of it though. And it’ll have to get a lot cheaper first!

It is pretty ridiculous that anybody in a normal job can’t afford a normal house to live in. I’m not saying this situation is unique to Ireland - but in most countries in Europe and even in America- if you earn a normal living you can live in a normal house. Somehow this ‘having to suffer to live somewhere nice’ is still very much alive in a lot of people…As a proffessional I still live in what I would qualify as student accomodation with my girlfriend (who is a proffessional too) and I feel we pay way over the top what the accomodation is worth…
It’s about time that this whole greed-race ended and people got their feet back on the ground! No that Piece of Sh*t is not worth half a million euros…get your arse out of La La Land now.
[rant over]

Anyway, should the greed win, I’m going to be out of here…Can’t live in a country like that…I do believe however, that the people shouting about the fundamentals now, will find out what ‘fundamentals’ really means in the course of the year. I’m still suprised by the power of denial, though - it’s amazing how strong that feeling is - Bad journalism like this article are misleading the public and could have a sustaining effect on the denial.

I too was disgusted with the article in the Sunday Times…I’d already given up on the Sindo for its misleading articles…I’m also giving up on the Sunday Times. It’s official, there is no decent independent newspaper with objective views left.

Maybe there never was.

:unamused: