When will the current surge in house prices stall?


#1

Background info - I’m bidding on houses in meath at the moment. I was sale agreed 12 months but the vendor pulled out of the deal. They then put the house back on the market 1 month ago and sold the same as for at least 35k over what we had previously agreed.

What are people’s thoughts on when supply might start to increase? Will this stabilise and/or reduce prices?

I’m in an apartment with 2 kids so I’m keen to buy but fearful of overpaying, especially if prices will start to reduce in 12 months time??


#2

A property related question on the Pin…what’s seldom is wonderful these days!

I don’t know what to make of the current surge Paddy. A combination of working from home panic amongst those in apartments/houses with no gardens, an increase in savings from those moved home or renting but not eating out etc, fear amongst potential buyers that with building creeping to a standstill they better jump in now. Could also throw in the moves by Govt into Help to Buy has also spooked potential private buyers into going sooner than planned.
All in all, a perfect storm leading to increased prices.

I think the steam will run out of the current surge but it could be another year or so before that happens. We’ll then have a new level for house prices where they should bump along for a while.
Where they go after that depends on the Govt bills that have to be paid back for the Covid shutdown…who pays and how much should have a big impact on prices in the years after that


#3

Hi Paddypie, I’m in a similar boat (Dublin) so feel your pain. I got to view my first house in months today and only because it’s vacant (even at that the EA said she technically isn’t allowed to be show it atm - nonsense rules!). Anyway, it was way worse than the pics, needs a total gut and is already 45k over asking. Even the EA couldn’t believe it. House next door also up for sale (only reason I viewed that one today) and is currently 30k above asking. I bid on two houses earlier this year in early stages, they went for 100k and 120k respectively over asking. It’s crazy.

Both the EA today and another one from the narrow pool of genuine EAs told me last week not to think about purchasing until at least autumn. It’s incredibly dysfunctional presently and even with a glut of houses coming on when viewings are allowed (one EA I spoke to has 4 houses pictured/videoed and ready to put up once viewings are confirmed as being allowed) it’s hard to see things evening out this year in terms of supply v demand even to go back to where prices were last summer. Unfortunately it’s not an option for me to ride things out for 18/24mths to see where things fall! Best of luck with it.


#4

Should also have said it depends greatly on the type of property you’re after. Not sure about Meath but an even bigger premium on anything remotely turnkey in Dublin atm due to lack of labour/building costs. This place in Terenure Gate went up last week for 795k and was at 860k by last Sunday with multiple bidders so i’m sure it’s gone higher.


#5

#23 Terenure Gate = €692k (not sure if that includes VAT) in Oct 17 per the PPR!


#6

Thanks Covidbuyer and Freefallin. You both make some very interesting points and it’s good to get another reflection of the market.

As you mention Freefallin, I’m also worried about that ridiculous Shared Equity Scheme coming out this summer, it will undoubtedly drive up the cost of new houses which in turn will have an impact on second hand house prices, in my price bracket at least. Obviously, it wont impact the house prices you are looking at Covidbuyer.

A good/straight agent I was dealing with also recommended holding off buying for 12 months if possible. Things will ‘settle down’ by then were her exact words. It’s very hard not to bid if you can afford it (even just about it) and the house ticks most of your boxes.

Interesting that some agents have properties ready to go for advertising, gives me some hope. You would think potential sellers would put their properties up for sale now given supply is so low and the bidding without having viewed situation seems to be adding to the frenzy.
Only today I asked an EA could I view a property, he said, “we are hopeful we will have viewings after Easter,” so with a bit of luck viewing might start back up next week.

I think we are going to start seeing some ridiculous asking prices too. I’ve noticed one or two already in my market. Although, I guess they’re not ridiculous if someone is prepared to pay it.


#7

A friend was bidding on the above property last week, he pulled out when a bidder went to 736K so not sure what price they finished at. It’s high for the area, I would think.


#8

Rockin’ All Over the World

Could you imagine listing your home for sale and having nearly 100 offers in just three days? This sort of thing is actually happening in hot real estate markets all over America right now. Even though we are in the midst of the worst economic downturn since the Great Depression of the 1930s, we are witnessing a frenzy of home buying that is unlike anything that we have ever seen before. Of course one of the biggest reasons why this is happening is because of the utterly insane economic policies of our leaders. They have been creating, borrowing and spending money like there is no tomorrow…

Ellen Coleman had never received so many offers on a house in her 15 years of selling real estate.

She listed a fixer-upper in suburban Washington, DC for $275,000 on a Thursday. By Sunday evening, she had 88 offers.

Src" http://themostimportantnews.com/we-have-never-seen-a-home-buying-frenzy-quite-like-this/


#9

I listened to David McWilliams’ podcast today. He’s basically calling a bubble/peak in the market - a Morgan Kelly type line in the sand from him.
Make of it what you will but there’s definitely some bizarre behaviour in the market at the moment


#10

The asking price for this property has increased 25K literally overnight. It was 350k yesterday, today its 375k. According to property price register, number 7 Wellesley Manor (identical house) sold for 330K in Jan 2020.