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About LinkBacksIf builders continue to cut back on building houses will that revive the Market. I know the issue of supply is important to price but given the public sentiment towards housing (Dont buy?) will this have much of an effect?
If builders continue to cut back on building houses will that revive the Market. I know the issue of supply is important to price but given the public sentiment towards housing (Dont buy?) will this have much of an effect?
ultimately yes. Impact won't be felt for another 12/18 months. Also depends on how long the supply overhang lasts and on whether the demand keeps up. Demographics will help keep up demand but a contracting economy and major reductions in the level of immigration will reduce demand.
House prices have more to fall but the lack of building is ultimately going to reduce the liklihood of a very protracted fall in value
Well apparently we have enough supply for 8 years!
House prices will NOT go up, as there are no 'Greater fools' left to buy houses from the current holders of the title.
Tom Parlon reminds me of Comical Ali at the moment, it's all the fault of the people talking down the economy.......
Gobsh1te.
Where did you get the figure for 8 Years? How could that happen? Would be great news as Builders and bankers need to suffer
The tightening credit will continue to reduce demand as many first time buyers struggle to affort current prices, but we'll see!
They haven't cut back enough to make any difference.Originally Posted by riker1969
If builders continue to cut back on building houses will that revive the Market. I know the issue of supply is important to price but given the public sentiment towards housing (Dont buy?) will this have much of an effect?
I think we only need 40k houses per annum and we will build close to that this year. But we built about 150k in the previous 2 years. So the 4 years of supply should keep the stocks high for another few years
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The demand side of the equation is going to be determined by the availability and cost of credit; lending criteria; and the price levels of homes in relation to average salaries to name a few key factors. There were some unique factors to our housing boom also. Someone sitting in a home in 1993 saw their home price rise meteorically during the last 15 years through no value input of their own. Secondly, there was the second holiday home phenomenon. Thirdly there was the speculative induced buying spree where the construction industry, estate agents, banks, the media and indeed government all came together to create a buying climate: get on the ladder now and profit or you will forever regret your lost opportunities. Forthly, the immigration surge saw the massive increase in buy to let opportunities.
There were also some global factors that greatly contributed to the demand equation. The availability of international cheap credit and the emergence of the largely unregulated securitised debt markets on a global scale contributed to the flow of capital into various national housing markets.
Whether these factors can be nurished to such as extent in the future is left to be seen.
A society of sheep must in time beget a government of wolves. (B. de Jouvenel)
Must admit, it was from another poster (admittedly pessimistic, or realistic depending on your point of view).
It also assumed the current rate of immigration woud continue!
I agree, the banks and builders need to take the hit of a deflated bubble. It was their fault in the first place.
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Banks will always come up with other ways to maintain their hyper-profitability.
Look forward to big marketing campaigns for personal loans , car loans , home-improvement loans etc. - all of which give them higher margins than mortgage lending.
Vlad The Impaler was the original stakeholder!
Have you not seen the vaguely pornographic ad's for Dublin apartments from about a year ago?!!! Desperation indeed.
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