Is there any truth in the rumour that the banks off-loaded much of their residential housing stock in 2006? Someone must know.Originally Posted by feargach
I was reading the Commercial Property section of the Irish Times two or three months ago and there were 6 shops for sale that had previously been estate agents. It struck me as odd at the time and I'm still not sure if it means anything.
Paddy Power opened a book on what the rate of increase in 2007 would be about 6 weeks ago. They had to close it the very next day because of the vast flood of money into "less than 3%". I got a nice piece of that action at 6-1 before they closed the book 8)
Je suis un loo-lah
sidewinder hi;Paddy Power opened a book on what the rate of increase in 2007 would be about 6 weeks ago. They had to close it the very next day because of the vast flood of money into "less than 3%". I got a nice piece of that action at 6-1 before they closed the book 8)
Won't the large number of migrants entering the country hold up property prices? (There has been some analysis of buy to let markets improving because of immigration.)
RIRA not in my name-Traitors to Ireland MMcGuinness; People are entitled to cultural & social equality MLMcDonald; We have a length to go understanding unionism GAdams
Of the Irish who migrated to Germany in the late 80's/early 90's to work, how many stayed??
Half of them are working in construction, and anecdotally they are living 14 to a house (just as the Irish did in England in the 80s). The NAS emigrants were also locked out of most European economies for 2 years from May 04, those restrictions will start ending soon.
As construction inevitably slows markedly over the next 2 years (we can't keep building 90K units per annum, we'll be down to 60K p.a. by 2009 at latest) then unemployment will rise and the emigrants will leave, especially to the more robust and stable German economy.
There's no way out of this one. We already have 127K units lying empty. Keep building and we have a massive glut and the economy crashes. Stop building and we have an unemployment surge and resumed emigration and the economy crashes.
Nice job, Bertie.
Je suis un loo-lah
HiHalf of them are working in construction, and anecdotally they are living 14 to a house (just as the Irish did in England in the 80s). The NAS emigrants were also locked out of most European economies for 2 years from May 04, those restrictions will start ending soon.
As construction inevitably slows markedly over the next 2 years (we can't keep building 90K units per annum, we'll be down to 60K p.a. by 2009 at latest) then unemployment will rise and the emigrants will leave, especially to the more robust and stable German economy.
There's no way out of this one. We already have 127K units lying empty. Keep building and we have a massive glut and the economy crashes. Stop building and we have an unemployment surge and resumed emigration and the economy crashes.
Nice job, Bertie.
Are there any historical examples of real estate crashes for one economy within a common currency area? The Japanese example is interesting but that was (arguably) partly caused by currency speculation. In the UK property crash of the 80s it was caused by a high interest rate due again to defence of a currency.
Ireland seems to be experiencing low interest rates (negative in real terms) but although this is fueling the economy there is no real risk of high rates that could result in a crash because interest rates are not set for our economy.
What is surely more likely than an interest-rate induced crash is a gradual erosion of competitiveness. Could this erosion be the correcting mechanism that provides the soft landing?
(Other dangers exist with losing competitiveness in a common currency area of course.)
RIRA not in my name-Traitors to Ireland MMcGuinness; People are entitled to cultural & social equality MLMcDonald; We have a length to go understanding unionism GAdams
Florida, 1926. California, 1990. The UK 1989 bubble, and crash, was largely confined to SE England.
Currency speculation didn't actually cause those bubbles to burst. They were simply triggers. The bubbles burst because they were bubbles and that's what bubbles do - burst. Usually there is some completely unrelated trigger event that produces a panic in the herd, but this trigger can be just about anything. The bubble bursts because asset prices have departed wildly from fundamental valuations and bubble-psychology and herd sentiment have overtaken rational investment.
Illogical. Irrational. Meaningless. Sorry.
How do you go from "interest rates are not set for our economy" to "there is no risk of high rates"???? Our real-negative interest rates are not fuelling the economy, they are fuelling asset speculation and distorting economic activity away from productive, value-added industry towards speculation and construction of non-productive assets. The last 5 years of real-negative interest rates have decimated our real productive economy.
Interest rates will go to whatever level the ECB deems appropriate to ensure price stability. End of story. With large inflationary pressures evident throughout the European economy, with M3 growth continuing to accelerate despite all the rises in 2006, with the Japanese defaltion officially over and BoJ rates returning to neutral, with the great Chinese deflationary impulse now over...interest rates will continue to rise to whatever level the ECB feels appropriate to keep Eurozone inflation below 2%.
This time next year we'll be staring 5% in the face. Unless there is a marked slowdown in M3 growth by June towards 4-5%, we might get a couple of 0.5% hikes later in 07. And regular .25% hikes every 2-3 months even if M3 does start to moderate.
There Is No Soft Landing. It Does Not Exist. It Is A Myth, A Triumph Of Wishful Thinking Over Cold Hard Reality. Get Over It.
A gradual erosion of competitiveness? We don't produce any goods that other countries want to buy, we don't provide any services that other countries want to buy, we're more expensive than anywhere else in Europe, our inflation is rampant, our economy is completely unbalanced and utterly dependant on just 3 sectors, and our populace have a sense of entitlement that we can all get rich just by selling our houses to one another. We have to import 100,000 Eastern Europeans every year to do the real jobs because Irish people are too stuck-up and lazy to get their hands dirty any more.
We don't have any "competitiveness" to erode!
Je suis un loo-lah
Sidewinder I fear you may be right.
However I am intrigued by the case of Australia, didn't they have a property price boom, then a downturn, followed by a recovery more recently?
We can turn the world around
We can turn the earth's revolution
We have the power
People have the power ...
Coles i thought the moderate slow down in price growth would you know be supported by the likes of you?
Life is a beautiful magnificent thing, even to a jelly fish ~ Charlie Chaplin
The situation in Oz is a bit confusing alright! As far as I can make out, Sydney at least had a boom, then a collapse where property prices dropped 20-30% off the peak during 04-06, then started to recover rapidly again mid-06, erasing much of the losses.
The US and Irish markets both stalled around May 06. Perchance the Oz rally is a function of all that hot money in California sloshing around looking for a home. Or it could be a dead-cat bounce, every bear market has one. That's pure speculation on my part though. It's certainly unusual behaviour for a housing market. Then again, housing markets everywhere have been behaving unusually since 2000.
Je suis un loo-lah
LinkBack URL
About LinkBacks
Reply With Quote