Fall in house prices fizzling out.

[michael1965]

It just shows how the builders/developers have the real power in this country. They shut off house building like a tap when prices drop marginally. Heaven forbid that an affordable house, or even a fairly priced house, be available to the people of this 'republic'.

The impression I'm getting is that developers who have the financial muscle are playing a waiting game, and refusing to drop prices by anything significant. They simply stop building any new houses, to minimise their costs. But sooner or later, if demand doesn't pick up, then the weaker builders will come under pressure, and be forced to drop prices. They might be betting that the inevitable rise in rents will force buyers back into the market in time. It's all a big game to see who blinks first.

[General_Hoche]

[quote=saratoga]

It just shows how the builders/developers have the real power in this country. They shut off house building like a tap when prices drop marginally. Heaven forbid that an affordable house, or even a fairly priced house, be available to the people of this 'republic'.

By 'power', you presumably mean the power to not build houses if you don't want to? Wow, they really are underhand.

By 'power', I mean the scam of constantly selling houses for €400,000 when they were built for €100,000. If supply ever overtook demand, this scam would end. Supply will NEVER overtake demand as long as builders can operate outside the scrutiny of government [and dont hold your breath for this current crowd to ever introduce housing targets for builders] You obviously believe that the bankrupting of young people to buy a roof over their heads is right and just.

No. And that's not what you referred to or implied by the use of the term 'power' in your original post. You specifically talked about 'turning off supply like a tap'. Obviously you think builders don't have the right to stop building houses when they, well, don't want to build houses anymore? They're trying to make a profit, do they have to apologise for that?[/quoteeq1io39]

Is 100% profit not good enough? That would make the average price of a house in Dublin €200,000. Problem solved. Why does every business person in this country have to tear the arse out of every god-damn thing and ruin peoples lives in the process?

[ibis]

It just shows how the builders/developers have the real power in this country. They shut off house building like a tap when prices drop marginally. Heaven forbid that an affordable house, or even a fairly priced house, be available to the people of this 'republic'.

The impression I'm getting is that developers who have the financial muscle are playing a waiting game, and refusing to drop prices by anything significant. They simply stop building any new houses, to minimise their costs. But sooner or later, if demand doesn't pick up, then the weaker builders will come under pressure, and be forced to drop prices. They might be betting that the inevitable rise in rents will force buyers back into the market in time. It's all a big game to see who blinks first.

This bit, then, would be the 'phony war' period? Interesting analysis, could well be true.

[droghedasouth]

It just shows how the builders/developers have the real power in this country. They shut off house building like a tap when prices drop marginally. Heaven forbid that an affordable house, or even a fairly priced house, be available to the people of this 'republic'.

The impression I'm getting is that developers who have the financial muscle are playing a waiting game, and refusing to drop prices by anything significant. They simply stop building any new houses, to minimise their costs. But sooner or later, if demand doesn't pick up, then the weaker builders will come under pressure, and be forced to drop prices. They might be betting that the inevitable rise in rents will force buyers back into the market in time. It's all a big game to see who blinks first.

This bit, then, would be the 'phony war' period? Interesting analysis, could well be true.

Yes, but this could very well be a long war, not a blitzkrieg.

Financially overextended builders who have bought landbanks at inflated values financed by bank borrowings might start to feel the pich.

[freedomlover]

It just shows how the builders/developers have the real power in this country. They shut off house building like a tap when prices drop marginally. Heaven forbid that an affordable house, or even a fairly priced house, be available to the people of this 'republic'.

The impression I'm getting is that developers who have the financial muscle are playing a waiting game, and refusing to drop prices by anything significant. They simply stop building any new houses, to minimise their costs. But sooner or later, if demand doesn't pick up, then the weaker builders will come under pressure, and be forced to drop prices. They might be betting that the inevitable rise in rents will force buyers back into the market in time. It's all a big game to see who blinks first.

This theory would not apply to second-hand houses. It also ignores the fact that there is a time-lag of close to a year between a decision to cut down on building new houses and a reduction in the supply of completed new houses. The number of new house starts this year is well down, but that won't be reflected in new house completions until next year. The number of new houses completed this year will be close to 80,000, which is extremely high historically for Ireland and in comparison with other countries, although slightly down from last year's exceptional 88,000 figure.

[DeGaulle]

There is a web-site http://www.thepropertypin.com/ which documents property price drops. One interesting thing that has happened lately is that myhome.ie has started showing prices as images rather than text, to try and make it difficult for people to see how much prices are falling.

Some other worrying figurs: 40% of first-time buyers have 35 year+ mortgages. What's going to happen to them if they end up in negative equity?
http://www.finfacts.com/irelandbusin..._1011365.shtml

[ibis]

There is a web-site http://www.thepropertypin.com/ which documents property price drops. One interesting thing that has happened lately is that myhome.ie has started showing prices as images rather than text, to try and make it difficult for people to see how much prices are falling.

Some other worrying figurs: 40% of first-time buyers have 35 year+ mortgages. What's going to happen to them if they end up in negative equity?
http://www.finfacts.com/irelandbusin..._1011365.shtml

They'll be there for a very long time?

[factual]

Falling house prices are good as they make houses easier to afford for those struggling to make ends meet on a limited budget.

[Aragon]

It just shows how the builders/developers have the real power in this country. They shut off house building like a tap when prices drop marginally. Heaven forbid that an affordable house, or even a fairly priced house, be available to the people of this 'republic'.

The impression I'm getting is that developers who have the financial muscle are playing a waiting game, and refusing to drop prices by anything significant. They simply stop building any new houses, to minimise their costs. But sooner or later, if demand doesn't pick up, then the weaker builders will come under pressure, and be forced to drop prices. They might be betting that the inevitable rise in rents will force buyers back into the market in time. It's all a big game to see who blinks first.

This bit, then, would be the 'phony war' period? Interesting analysis, could well be true.

The 'inevitable rise in rents' is unlikely to happen for the simple reason that there are more houses available to rent than there are people to rent them. There are many, many people who by extending themselves financially, built/bought second homes with a view to letting them and who cannot afford to play the big speculators wait and see game. They need income from those homes now and something is better than nothing. With the anticipated increases in job losses, demand for rented accommodation is likely to decrease as eastern european people feel the pinch and maybe go home or elsewhere.

[michael1965]

It just shows how the builders/developers have the real power in this country. They shut off house building like a tap when prices drop marginally. Heaven forbid that an affordable house, or even a fairly priced house, be available to the people of this 'republic'.

The impression I'm getting is that developers who have the financial muscle are playing a waiting game, and refusing to drop prices by anything significant. They simply stop building any new houses, to minimise their costs. But sooner or later, if demand doesn't pick up, then the weaker builders will come under pressure, and be forced to drop prices. They might be betting that the inevitable rise in rents will force buyers back into the market in time. It's all a big game to see who blinks first.

This theory would not apply to second-hand houses.

Yes and no. The market for 2nd hand houses is still influenced heavily by the market for new houses. In particular, it's the market for new starter houses that props up the rest.

It also ignores the fact that there is a time-lag of close to a year between a decision to cut down on building new houses and a reduction in the supply of completed new houses.

No. A lot of developments have downed tools at whatever stage they were at, and won't resume until buyers return.