David McWilliams on the housing market: Perhaps not there yet, but heading this way again?

4 comments

  1. Basically FG listened to this and went ‘I don’t see the problem? Let’s do this again but better.’

    That’s Irish housing policy for the last decade.

  2. House prices are definitely too high today. But 15-20 years ago, banks were lending more recklessly at a time when there were plenty of properties being built. Access to credit fueled the rapid growth then. It was much more of a scam then. Estate agents were inventing fake bidders to get more money out of people. I knew so many people getting 107% mortgages.

    Today it’s much more to do with scarcity of houses. Mortgage lending rules are far more strict. If tomorrow the government lifted the cap on how much you could borrow based on your salary we’d probably see a huge jump in prices and be more at risk of a crash. But assuming the rules stay the same, the thing that will bring house prices down will be increased supply. That isn’t something that will happen suddenly like a banking collapse. The scarcity will likely ease slowly, so prices will fall in time but not dramatically as there will still be people with mortgage approval there to buy them.

  4. Mac the hack!

    https://twitter.com/davidmcw/status/1117753424626503682

    3.5 years ago…

    >That’s it! Commercial property market peaked. Green Reit getting out – massive sell signal for the market. Suckers line up. Reminiscent of AIB’s sale and lease back for their HQ in Ballsbridge in 2007.Tick Tock!

    He hasn’t got a clue. He told people in 2020 to stay out of the housing market for two years if they could. If you listened to him and pulled out, you’d have seen prices in crease about 25% since.

    And if you listened to him in 2003, you’d have missed out on all the gains up to 2008. So he was wrong.

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