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i see where your coming from , but what exactly is your point ? while i think its not exactly FF'S fault they have not exactly covered themselves in glory in handling the situation.
It seems to be to have been a western problem. House prices are tanking in several western countries, the US, UK, Spain etc. In Australia they are a bit wobbley but are being helped maintain their value by strong migration into the country and builders bail outs. The death toll in the recent bushfires was made worse by one off houses in the forests north of melbourne - its still the aussie dream to own a house on a half acre despite the obvious difficulties this causes during droughts.
I think its a myth that the Irish are obsessed with property myself. I've sen this preoccupation in Melbourne and any English people I know are only to ready to borethe pants off all comers with discussions on the property market.
The government shopuld have acted with more imagination to try stop the over reliance on construction that developed but it wasn't a uniquely irish problem by any means.
As the great warrior poet Ice Cube once said, 'if the day does not require an AK, it is good.'
The funny thing about all this is that housing bubbles have happened before in other countries, late '80s in the UK, Finland had one, various places in the US and we still felt that we were somehow special in the middle of ours and that we would not be exposed to house price decreases and with twits in the media like G. Ryan openly stating that house prices never go down, what should we expect?
I guess it is more human than it is national in terms of the behaviour so it is likely to happen again and the people who are in the market will not have the memory of what happened firsthand, and so ignorantly they go, thinking that somehow they are special. It seems to be linked to that natural sense we have of "it couldn't happen to me" or "it won't happen to me" when we consider any serious illness or risk to our health.
There is nothing ever permanent but there are things you can rely on, the Politicians and Developers will act in exactly the same way the next time round.
We are "they"
The Aussies/British Ex-Pats don't take to it with the same vigour as the property fetishists in Ireland. Compare rental yields versus interest rates for Melbourne/Sydney and Dublin/Cork. Australia also has negative gearing which means that Aussie investors don't have to rely on capital appreciation because they are in a win-win as long as any losses are less than their tax liability in a given year.Originally Posted by shutuplaura
I'll take your word for it, I usually stop listening whenever anyone in work starts talking about the property market. You are probably right re British/Irish Ex-pats but most I know don't know if they are staying here long term (the preoccupation is with the visa situation not the housing market) so I can't say. It surprised me when I came here to hear australians in work talking about property the same way as the Irish did - I assumed it was a largely Irish pre-occupation.
As the great warrior poet Ice Cube once said, 'if the day does not require an AK, it is good.'
There is a difference in scale. For Several years, this small island of 1m households was building 90,000 houses a year. We were increasing the supply at a rate of about 9% per annum, and at the same time the price was inflating at around 15-20% per annum.
I don't know the numbers in other countries, but per head of population we were probably producing more houses than anywhere else. Its no shock that prices will collapse. Personnally, I expect prices will never recover to the outlandish peak of 2006.
Edit: I went searching for numbers, and found out that the constuction industry represented 6% of GDP in the UK at the peak of the market. The figure was about 20% in Ireland.
Edit2: 185,000 new houses in the UK per year. Thats one house for every 330 people. It was 1/50 in Ireland, nearly 7 times more. http://www.telegraph.co.uk/earth/gre...od-plains.html
Last edited by seabhcan; 25th February 2009 at 12:40 AM.
"Who will bailout the IMF after FF is finished with them?"
I was referring to the Aussie property market. The yields are circa 5% which is quite close to current interest rates. There has been a disconnection between yields and interest rates in Ireland in recent years. It's possible for a buy-to-let investor to generate a profit in Australia, not so in Ireland. Also, while it may be rational for an Aussie investor to make a loss on their investment property and write off the loss against tax, the Irish invesotr does not have that luxury. The Aussie situation is completely different to Ireland.
Did I hear you can claim tax back on capital gains losses over here?
You may have misuderstood my post - I was refering to English inhabitants of the UK not ex-pats over here. My brothers english friends in the south east of england are what I was basing much of that observation on.
True, the situation, the market dynamic or whatever you weant to call it is different to Ireland here in australia however, I'm not sure how different the australian attitude to house ownership is - it seems quite similar to me in fact. The dream for my work collegues is house with a big garden. There is no evidence for this much touted readiness to rent for life that I hear supposedly exists outside of Ireland. Not here at any rate.
As the great warrior poet Ice Cube once said, 'if the day does not require an AK, it is good.'
Yep. Crazy stuff. I can't understand how they call it 'investing'.
[Edit]Actually, not sure about capital losses. Ongoing losses can be offest, i.e. rental income - mortgage payments = loss = tax write off[/Edit]
The difference is that the premium to buy versus rent in Australia is not as big as in Ireland. The market here has a degree of rationality. My own apartment is currently for sale for $828,000 with no offers. If you could get it for $750,000 then the interest portion of the mortgage would be the same as rent. You wouldn't find that in Dublin City.
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