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 Post subject: Re: 2Pack will call the bottom now!
PostPosted: Fri Jun 29, 2018 5:53 pm 
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Rents fell because there was a flood of new housing on the market, plus lots of easy money lent.
the rental market is very different this time around.

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 Post subject: Re: 2Pack will call the bottom now!
PostPosted: Fri Jun 29, 2018 8:22 pm 
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dolanbaker wrote:
Rents fell because there was a flood of new housing on the market, plus lots of easy money lent.
the rental market is very different this time around.

There's been graphs posted here a few times that showed in mature markets that rents generally lagged a year behind house priced in declining. I certainly saw it in action in Australia.

Let's say for argument's sake that Dublin has reached top now, will we see a similar topping off in rents in about a years time?

Brexit might provide some spillover but there's new supply meeting the market from now on.

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 Post subject: Re: 2Pack will call the bottom now!
PostPosted: Fri Jun 29, 2018 9:10 pm 
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If looking at cashing out and potentially renting. You could do this in 2006 because rents were affordable. You can't today or for the foreseeable.

There is also the issue of the REITS/Big time landlords to consider this time. How will they behave if prices/rents start to wobble. Could there be a stampede from this herd if falls in either market occur and a little bit of momentum gathers. Even over the next 12-24 months.
Add in thd perception of political instability from FG/FF into the mix to spicen things up.


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 Post subject: Re: 2Pack will call the bottom now!
PostPosted: Sat Jun 30, 2018 4:33 pm 
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Under CAB Investigation

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Professional landlords guarantee permenant high rents.

The economic are simple - it is better to leave apartments empty than reduce rents across the board. - 50 apartments sitting ideal vs 3000 at 60% of current rent roll.

The gombeen landlord is dead welcome to the new order :)


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 Post subject: Re: 2Pack will call the bottom now!
PostPosted: Sat Jun 30, 2018 11:44 pm 
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Luan wrote:
Professional landlords guarantee permenant high rents.

The economic are simple - it is better to leave apartments empty than reduce rents across the board. - 50 apartments sitting ideal vs 3000 at 60% of current rent roll.

The gombeen landlord is dead welcome to the new order :)


Luan is correct here - for the REITs the book value of the property can be based on the average rental - if you lower the rental below the average then the book value falls. The void level does not enter into the valuation. So if you have a 100 apartments in the block and only two are rented at 2k each then the block is valued at a rent roll of 200k. Of course smart investors go round and look to see how many lights are on but most REIT investors take the valuation as given.

A property tax can reduce the attractiveness of this but it has to be pretty punitive to work. If I remember correctly the old rates system operated on the basis that you were receiving rental 11 months of 12 on all the rental property.


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 Post subject: Re: 2Pack will call the bottom now!
PostPosted: Sun Jul 01, 2018 8:41 am 
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Voids are included in asset valuations for property companies. It’s a basic input into the professional valuation. Plus accounting rules on value diminution are well considered when producing balance sheets.

Large professional holders of residential property can have an impact on a falling market.

REITS rely on quarterly valuations and these are reported to the market at least twice a year. When the property cycle turns and there is no hiding from the drop in values and this can cause a spiral very quickly. Effectively a valuer can’t value flat A at €X for a REIT and then value the flat next door at a different level for a mortgage application. The assumptions should hold across the board. This is happening in London now hence the last 18 months of negative growth.


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 Post subject: Re: 2Pack will call the bottom now!
PostPosted: Sun Jul 01, 2018 11:59 am 
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Didn't a bunch of really big REITs go bust in Canada last year, some needing a bailout?

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 Post subject: Re: 2Pack will call the bottom now!
PostPosted: Mon Jul 02, 2018 8:27 am 
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It would have been great to have had REITs reporting on rising voids and flat rents from late 2007 onwards.

About 12 months of nonsense and obfuscation from industry and banks would have been avoided.

When the next dip in the Irish property market comes, REITs will be the canary in the coalmine.


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 Post subject: Re: 2Pack will call the bottom now!
PostPosted: Mon Jul 02, 2018 8:58 am 
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Luan wrote:
At least another 2 years before we see the peak of market


Well my post was a bit in cheek, what it at least signifies is euphoria. We possibly could get 2 more years of decreasing rises before we get an actual decrease.


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 Post subject: Re: 2Pack will call the bottom now!
PostPosted: Mon Jul 02, 2018 12:41 pm 
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The trend will remain upwards but monthly/quarterly decreases will happen.


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 Post subject: Re: 2Pack will call the bottom now!
PostPosted: Sat Jul 07, 2018 5:29 pm 
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Location: North Dublin
Was just looking at daft to see what's going on in my estate. Houses with same size and level of renovation / refurb required are now asking around 15-25K more than I went sale agreed in July 2008 (bought and got the keys Sept 2nd 2008).
not sure how far from that peak that was, but at the time similar houses were in the market with 485K asking (they didn't sell at that though).
I paid 425K at the time, just a few weeks before the proverbial was really hitting the fan.

At the bottom, same houses went for around 280-300K, albeit only very very few were on the market at the time.


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 Post subject: Re: 2Pack will call the bottom now!
PostPosted: Thu Aug 02, 2018 9:43 am 
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Old Time Landlord

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More price drops than price hikes in prime Dublin areas in first six months

https://webcache.googleusercontent.com/ ... refox-b-ab


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 Post subject: Re: 2Pack will call the bottom now!
PostPosted: Thu Aug 02, 2018 11:21 am 
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KOR101 wrote:
More price drops than price hikes in prime Dublin areas in first six months

https://webcache.googleusercontent.com/ ... refox-b-ab


I had a look at CSO figures:

Dublin house prices up just 1.9% Jan to May
Dublin apt prices up just 0.8% Jan to May


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 Post subject: Re: 2Pack will call the bottom now!
PostPosted: Thu Aug 02, 2018 12:08 pm 
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Lads,

Yizzer dangling temptations in front of me there. :)

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 Post subject: Re: 2Pack will call the bottom now!
PostPosted: Thu Aug 02, 2018 12:25 pm 
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It looks like a bit of a plateau now in Dublin. The next month or two of data from CSO will likely confirm it.

Seller expectations are being forced to re-correct to what buyers can afford as the CB rules keep lending in check.


Short term I can see:

-Banks forced to lower mortgage rates and offer more cash back/legal cost incentives to meet their loan targets.

-Govt put under pressure by interest groups to circumvent CB rules, like they did with the 20K FTB new build grant.

-TDs and interest groups asking CB to loosen their rules again.


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