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Thread: What are your bets on a property market crash?

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    Default What are your bets on a property market crash?

    What are your bets on a propert market crash?
    What are the odds of a crash in the property market particularly in Dublin in the next 12-18 months. If it happens it will have the same effect for FF as 1992 did for John Major and the UK Tories.

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    Define crash. The areas on the perimeter of Dublin are far more likely to crash because they are of less strategic value. Property in more strategically located areas, near transport, the city etc are less likely to. The very top end of the market is also likely to adjust a bit, unlikely to cause huge amounts of bother, people who have a 4 million euro mortgage can probably withstand a 4% adjustment more than someone with a 300,000 euro mortgage.

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    The property price crash in the UK occurred in 1989/90. Yet, John Major won the election in 1992. What harmed the Tories in 1992 was Black Wednesday, which damaged their reputation for economic management. That had nothing to do with the property price crash which was well and truly over by 1992. Property prices rose sharply in the UK from 1992 on and are still rising.

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    I suppod crash is a decline of from 20% to 50% in house values across the city with negative equity and rising repossessions due to rising interest rates and the bloated construction sector at least wobbling with large scale job losses. Not necessarily causing a recession(but with a weakening dollar not beyond the realms of possibility either)

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    Quote Originally Posted by epml2000
    I suppod crash is a decline of from 20% to 50% in house values across the city with negative equity and rising repossessions due to rising interest rates and the bloated construction sector at least wobbling with large scale job losses. Not necessarily causing a recession(but with a weakening dollar not beyond the realms of possibility either)
    I'm very sceptical about Ireland's medium term economic prospects. However, over the next 5 years I don't think you will see an adjustment in the market up to the level of even 20%. You may well see that in particular areas, as I said ones of less strategic locations... like blocks of apartments miles from public transport which are only half full because people have bought them solely for capital appreciation and a percentage of the other half are rented by short term immigrants.... that sort of property may well fall by up to 30%. I don't think in the next 5 years you'll se an adjustment of up to the level of 20% across the market.

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    Quote Originally Posted by freedomlover
    The property price crash in the UK occurred in 1989/90. Yet, John Major won the election in 1992. What harmed the Tories in 1992 was Black Wednesday, which damaged their reputation for economic management. That had nothing to do with the property price crash which was well and truly over by 1992. Property prices rose sharply in the UK from 1992 on and are still rising.
    You are right in terms of the property crash was earlier in the UK. I am factually incorrect. But I do not think prices has started to rise by 1992 as I was in London then and there was still a serious problem. You are right about black wednesday.
    What I mean is that if this happens this surely will be FF's Black Wednesday.
    How likely do you think that a property market crash is?

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    The most important thing for most in Ireland's society is not the value of their houses per se because all investments increase and decrease but rather their ability to pay their mortgage. A home dwelling is after all not really an asset, not in the sense that you can dispose of it and do without another. We wouldn't need a market crash for people not to be able to pay their mortgages.

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    god knows. once upon a time we used to have depression. then it becam recessions then economic downturns.

    ive no doubt we'll see a "housing crash" but what they'll call it is another thing. my current favourite term was stock market "re adjustment". which basically meant 25% fell off the values of shares when china sneezed so i confidently reckon a term similar to that will be used so if you hear of " housing price re adjustments" get worried.

    fact is i think its happened already. the gaffs across the way from me are 40k cheaper than they were six months ago and no one seems to be talking about it, and i dont live in a salubrious area either, from what i hear housing repossessions are on the up and people are being laid off for the first time in construction.

    throw in the next two increases in interest rates that are due this year and i think you could see some significant effect being felt by years end

    i agree with johnfas. in a way im happy FF are back in power because i reckon theres a recession ahead and i think they were hopin enda and co would take the rap for it. the govs been waffling on about all the jobs being created but neglect to say theyre mostly in the public sector and construction. one is earning way more than its worth and the other is starting to stall. the outlook aint good.
    “The measure of a civilization is how it treats its weakest members.” Vote NO on May 25th. 2016 : Anybody but FF/FG/LAB !

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    confidence seems to have gone out of the market, once confidence goes in a market it takes a long time for it to return, remember the .com meltdown?

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    Quote Originally Posted by markmchugh
    confidence seems to have gone out of the market, once confidence goes in a market it takes a long time for it to return, remember the .com meltdown?
    I'd agree with that but if you look at the major property developers they're still buying huge plots of land and if you look at the estate agents, many are being bought by UK firms who I would argue wouldn't invest here if they didn't think there was money to be made... Gunne, HOK, Ganly Walters, Colliers..

    The greatest issue isn't a decline in house value as such as that only really affects people with multiple properties as investments (who are already pretty well off if they can do that) but the actual ability of people to make repayments.

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