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Why Ireland's housing bubble burst

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Re: Why Ireland's housing bubble burst

#101

Post by oblio »

inglor_cz wrote: post #92
qwytw wrote: post #81

Earlier quoted context omitted.

Germany also has a much more decentralized economy and more spread out population compared to other European countries. There is no city equivalent to London, Paris or Dublin. For example Berlin's population only started growing in the 2010's (it's was stable or declining since the 1990's) and prices have been growing quite rapidly lately so arguably it just a few years (or decades) behind other major European cities…

Munich is crazy. You would have to be a very upper middle class to afford children and a house there. Unless you inherited one, of course.

House or an apartment?

Re: Why Ireland's housing bubble burst

#102

Post by onlyrealcuzzo »

greesil wrote: post #57

It's like this guy has never heard of a speculative bubble, and sets up a series of straw men to nock down instead. Even though "bubble" is in the title. Edit: oh I get it, his point is that yes there was a bubble, and that's why prices went up. Without extra supply it would have been worse. I think that's putting the horse before the cart, because without the bubble the extra supply wouldn't have been built. This po…

In lot of housing markets (most) - one cannot simply build more housing. The localities do everything they can to limit supply.

In fact - places like Ireland are shockingly rare exceptions where supply actually went up with demand.

That's why this article is interesting.

Re: Why Ireland's housing bubble burst

#103

Post by thefringthing »

nemo44x wrote: post #44
onlyrealcuzzo wrote: post #42

Earlier quoted context omitted.

Canada doesn't have a 30-year fixed rate mortgage, though. So anyone making that trade better be betting that interest rates never go up...

Aren’t the rates fixed? If not then it’s a fairly ridiculous trade to take on. If no one has a fixed rate then without massive inflation any kind of interest surge will decimate the country.

The standard mortgage in Canada has a five-year term, amortized over 25 years. You generally cannot lock in a low rate for 30 years the way you can in the United States.

Re: Why Ireland's housing bubble burst

#104

Post by oblio »

randomdata wrote: post #31
shell0x wrote: post #20

Meanwhile in Toronto a house is $1m+ while salaries are 100k-150k.

That's driven by the farmland bubble. Southern Ontario farmland prices are up 700% since the mid-2000s, which has priced urban sprawl out of the market. With Toronto (i.e. the cities around the City of Toronto) unable to expand like they once were able able to, that has increased buying pressure on the land that is already within the city limits, thereby also driving up the cost of housing in those cities. While Cana…

Are you building higher density stuff?

If not, the injury is self inflicted.

Re: Why Ireland's housing bubble burst

#105

Post by raverbashing »

onlyrealcuzzo wrote: post #95
qwytw wrote: post #88

Earlier quoted context omitted.

> Basically, the "fixed rate" very rarely was smaller than the floating rate. Well that's obviously expected. But by taking an fixed rate loan you're basically betting that the rate will increase in the future. Of course there's a risk that the interest rates will stay close to zero for the next 30 years like in Japan.

You can get a new mortgage at a lower rate if interest rates go down... You're allowed to repay.

Not "can" but "might be able to". For example, new builds might get you a lower interest rate, but if you go to refinance, then it's not a new build anymore. (Though in one way this is usually true - a lower principal will give you a lower interest rate usually)

A lot of banks do charge you a penalty for repaying before the (fixed interest) term in case of fixed rate mortgages.

Re: Why Ireland's housing bubble burst

#106

Post by ploika »

eliasmacpherson wrote: post #50
ploika wrote: post #46

Earlier quoted context omitted.

He covered the empty estates issue well enough I thought: by the mid-2010s they were mostly fully constructed and occupied, including in rural areas. That chimes with my experience, having lived in a few different parts of the country (urban and rural) over that time period. It was rare for completed housing estate to be bulldozed.

You will find that you are wrong about the occupation rates in rural areas, it's still at around 180000 unoccupied dwellings at the last count. Misleading not to make the distinction between Unfinished and Empty just to make a point, leaving out half the story in numbers terms. The article would have been more accurate if the titles of the 'Myths' were about Dublin and not Ireland. I don't have figures for the amount…

A lot of the complete-but-unoccupied homes in rural areas are holiday homes I believe, but I can't give you a reference for where I read that. Another big chunk are basically barely-habitable hovels in probate.

You won't find many empty 3-bed semis with a BER above F outside of urban areas. I still think he was broadly right about the ghost estates nationwide.

Re: Why Ireland's housing bubble burst

#107

Post by mandmandam »

adam_arthur wrote: post #94
Fordec wrote: post #76

Earlier quoted context omitted.

Most of the government policy at the time can be tied to bribes by developers. Look up "brown envelopes"[0] or the subsequent Mahon (formerly Flood) tribunal. https://www.rte.ie/news/2003/0501/37800-flood/

So why blame the developers and not the government? People lobby for different things all the time, it's the government that sets the rules. The only power public has is to vote out those officials, or lobby the other way. There were structural, government induced factors that helped lead to the 2008 GFC in the US too. You could blame irresponsible buyers, or the banks, but it's the government regulation that is the…

I think the fact that you've been pointed to firm evidence of bribes, yet call the developer's actions "lobbying" says a lot about your good faith here.

In case you're actually reachable though - just because a government fails to stand up for its people does not excuse the complicit parties who "lobby" them to fleece normal people by the millions.

Re: Why Ireland's housing bubble burst

#108

Post by simplestats »

greesil wrote: post #57

It's like this guy has never heard of a speculative bubble, and sets up a series of straw men to nock down instead. Even though "bubble" is in the title. Edit: oh I get it, his point is that yes there was a bubble, and that's why prices went up. Without extra supply it would have been worse. I think that's putting the horse before the cart, because without the bubble the extra supply wouldn't have been built. This po…

Looks like the links in the second paragraph are examples or perhaps origins of the myths he is attacking.

The topic is apparently his phd thesis.

Re: Why Ireland's housing bubble burst

#109

Post by adam_arthur »

mandmandam wrote: post #107
adam_arthur wrote: post #94

Earlier quoted context omitted.

So why blame the developers and not the government? People lobby for different things all the time, it's the government that sets the rules. The only power public has is to vote out those officials, or lobby the other way. There were structural, government induced factors that helped lead to the 2008 GFC in the US too. You could blame irresponsible buyers, or the banks, but it's the government regulation that is the…

I think the fact that you've been pointed to firm evidence of bribes, yet call the developer's actions "lobbying" says a lot about your good faith here. In case you're actually reachable though - just because a government fails to stand up for its people does not excuse the complicit parties who "lobby" them to fleece normal people by the millions.

It's simply an ineffective way of looking at the world.

The government is the one that sets policies, not the developers. To me a government official that accepts a bribe and makes far reaching policies in response to one is much more culpable and to blame than somebody making the bribe.

It's like if a company hired a lot of unqualified people and then blamed those people when it failed, rather than their system of checks and balances in the hiring process.

Focusing on the player and not on the rules of the game is simply a losing mentality, sorry.

The whole point of democracy is about holding government accountable when they make mistakes. Diverting blame to non government actors doesn't solve anything

Re: Why Ireland's housing bubble burst

#110

Post by dtjohnnyb »

Interestingly Leitrim and other counties in the north west he mentions have been high on the list of places people have escaped to from Dublin during the pandemic. Many people are now living there and working remotely for Dublin companies, and there are far too _few_ houses there now, and house prices have skyrocketed
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