Ireland’s Budget 2012, announced earlier this month, contained a number of property-related measures. This post reviews them. One would hope at this time that any measures would be the bold actions of a government with a large majority trying to create a sustainable property market. Instead, they seem like the actions of an addict who just can’t give up. Unsustainably cheap credit can never be the answer, boosting confidence and finance has to be.
The latest Daft.ie Rental Report, released today, found that rents nationally rose in the third quarter, for the first time since early 2008. The urban-rural difference in trends persists, though. This post looks at trends by bedroom number, finding rising rents for family homes in most urban segments. A persistence in thinking about one national property market, however, will prevent the response required to keep an adequate supply of competitively priced accommodation.
The latest Daft Report was released this week and shows asking prices up to 55% below their peak. This post uses the latest figures to estimate when property prices in Ireland will bottom out. It outlines two scenarios, one where the country returns to normal lending conditions, and one where it does not and risks another boom-bust cycle. With the correct steps by the Government, property prices could stabilise in early 2013.
Last week saw Ireland’s third property fire-sale. These auctions give a unique set of data-points for property market analysis. This post analyses the third auction, outlining the typical fall from the peak and the yield achieved, one of the most important metrics in the market. It also highlights some interesting trends comparing the auction results with those from previous auctions.
Sparked by some figures by Morgan Kelly and a pseudonymous letter to the Irish Times, the last two weeks have seen an immense public debate on the topic mortgage debt forgiveness. This post attempts to step away from the emotional charge of the debate. It examines ten key facts on Ireland’s mortgage debt, in relation to arrears, repossessions, mortgages being paid off and the labour market. It also presents an estimate of Ireland’s aggregate “loan-to-value” for residential property and a comparison with repossessions in the UK, before I give my own thoughts on the topic.
The latest Daft.ie Rental Report shows that rents nationwide have been largely stable over the past twelve months. This post looks behind these top level figures and explores two issues in particular. The first is the stock available to rent in the cities across Ireland, and whether this will push rents down in coming months. The second is how far the rent-house price relationship has adjusted back to normality in the past four years… and how much more of an adjustment is needed.
This post analyses the information contained in the recent second “fire-sale” auction of Irish properties. By combining the auction results with an economic model of house prices, it’s possible to estimate how far auction prices are below the peak and below current asking prices. It’s also possible – using the results from the two auctions – to compare Dublin and the rest of the country: while asking prices have fallen more in Dublin, closing prices have fallen by less, and the gap between ask and close in Dublin is nearly half that of elsewhere. This suggests that “market thickness”, information and the proposed house price database matter.
With the release of the latest Daft.ie House Price Report showing the average house price below €200,000 for the first time in a decade, this post examines three different ways of calculating what house prices in Ireland “should” be. The most straightforward way is to adjust house prices for inflation, but this may not reflect the transformation of the Irish economy since the mid-1990s. Two other methods – comparing to incomes and to rents – both suggest that the average house price should be about €150,000, a fall of 60% from the peak. If this is true, prices may bottom out in Leinster as early as next year and elsewhere by 2014.
This post looks at what foundation stones the Government should put in place to build the next generation of Ireland’s property market. It briefly reviews two that I’ve discussed before – the importance of a national house price register and a land value tax – before outlining two further proposals in more detail. A set-in-stone minimum deposit would greatly reduce the potential for policy to amplify bubbles, while banning variable rate mortgages would not only protect vulnerable households but also reduce the degree to which the economy is subject to ECB-induced recessions.
This post reviews the findings of the latest Daft.ie Rental Report. Rents rose slightly in the first few months of 2011, and the year-on-year change in rents in some parts of Dublin and in Cork city is positive time for the first time since 2008. This post explains how this is both a bad signal but a good sign, and what it tells us about the underlying economy.
