Hotdog you hit the nail on the head when you said rent is high cause buyers are now renting .Even property owners across the country are renting there homes (unknown to the taxman) and renting a more suitable home.Everyone is refusing to sell (like poker not folding) and it purely because 1) they aren't declaring the extra income and are using it to paydown there" investment". And 2) affordable repayments compared to historical Ave.
Real landlords are buying only if the achieve a 10% pre-tax return or greater. Otherwise after all expenses they would be better off in a zero risk low rate investment, because there real return would only be <3%.
Rates are subject to sudden change of policy and I would see this sooner than later!GLA
your experience is surprising hotdog. What i see and hear is completely different. Standard houses of all types are selling way quicker in the commuter belt that at any time since the boom. Farm land is possibly in bubble territory, close to 30% up in a year. Banks are verging on the reckless as to what they are offering some farmers to buy land. I know one farmer that refused to bid up to the banks offer letter.
People are renting and rents are up because houses in dublin are scarce and too expensive for many.
it will be interesting to see where average prices will be at the next announcement. I'll be very surprise if there not up a couple of %.
Goodbodys 2 days ago.
First quarter mortgage drawdowns released this morning confirm the strong rebound currently underway in the Irish housing market. The volume of mortgages drawn-down in Q1 2015 grew by 64% yoy, with the value growing by 73% yoy due to a 6% increase in the average mortgage size. While the noise created by the announcement of new macroprudential rules from the central bank makes it difficult to discern underlying trends, the first quarter outturn is above our expectations and creates upside risks to our full-year forecast. All categories of lending grew strongly in the first quarter of the year, although the market remains dominated by first-time buyers (FTB) and mover-purchasers (MP), together accounting for 90% of drawdowns by value in the opening months of 2015. FTB drawdowns grew by 90% in Q1, while MP drawdowns grew by 50%. Buy-to-let remains small (4% of total) but is now growing strongly as investors take advantage of the positive rental growth and yield dynamics. An emerging theme over recent quarters has been the re-emergence of re-mortgaging (4%). This category quadrupled in value terms in Q1, but remains a small part of the market. Finally, top-ups grew by 21% yoy, but also remain a very small part of total mortgage lending (2%). While it is difficult to quantify the incidence of those who received mortgage approval under the "old" regime accelerating home purchase, we are encouraged by both the Q1 numbers and the fact that March mortgage approvals (65% 3MA yoy in value terms) remained strong. The housing recovery, fuelled by strong demand, has momentum.
John, I'm sorrow and no disrespect......banks per se are not lending and those that do apply have to go through no matter who you are an arduous nazi style interview process so that can make an "informed" decision . It's all b/s. I'm doing a big building job refurbishing a house. For the craic I asked them for a short term loan for 400k......they more or less told me to F off. Thankfully I have my BKIR shares to fall back on. If they are not lending to me they are lending to no one. The rental market is bouyant for a reason.
Hotdog. Ok banks are more picky and discriminating about who they lend to but they are very willing to lend. i think its more people are just not willing to borrow. Having said that the figures for the first 3 months shows an increase in the lending numbers but that may be the rush to beat the new CB rules.
Allmoyne. rates will only rise in response to Inflation. A complicating factor for Ireland is that we are lumped in with European inflation. so its likely we will actually end up with one of the highest inflation rates in europe as others play catch up. either way there is absolutely no sign of an imminent rate rise. early 2017 in europe at the very earliest and probably later. Even after all the billions printed in the world, growth is sluggish in the US with wage growth non existent. I wont worry about the effect of interest rate increases on Ireland's economy for some time yet.
Outstanding loans count as borrowed money... and borrowing rates effect expendable income, which drives growth,.... and rates will control future growth by directly removing all wage growth and handing it back to the lender!
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