*“The idea that house prices are determined by supply & demand is an infantile view of how the market works. Asset prices in Ireland are very high, because there is a wall of money looking for somewhere safe to land — & property is regarded as a safe asset”*
*“That’s what is hiking prices in Ireland — not supply and demand. You could cover all your land in concrete and prices will still rise, so long as mainly foreign capital is free to invest in finite Irish assets.*
*“Liquidity will at some point dry up, and that will have an impact on house prices. How? Think of how it impacted the US in 2007. In the movie The Big Short, the pole dancer suddenly couldn’t pay her mortgage, because in real terms her wages were falling. So it was people like her who brought down the whole financial system.*
*”That’s the point. People are taking out mortgages, they think everything is fine. But their mortgage rates are rising.*
*”Incomes in Ireland are very high for people in finance and tech. But that is not true for others who are borrowing to buy houses. There comes a point when energy and food inflation eats up more of their income and leaves less for the mortgage. That’s going to happen at some point — when, I’m not at all sure. But that’ll be the moment to worry.”*
Prices wont crash, there just isn’t any supply and the supply to crash the price is 5 to 10 years away. Why? I know far too many joint salary earning 100k and can’t afford a house as they are being out bidded still. If price go down marginally still far too many (like myself) that will jump at the chance to finally get a home.
I don’t know what’s worst between another buble bursting or this tbh, probably above.
Thanks Fine Gael / Fianna Fail.
This is partly why im voting sf. Ff and now fg repeating these mistakes and its no accident they both knew what would happen and didn’t act for whatever reason.
I disagree. I think the problem is supply lol
People who bought over the last year could be in real trouble. All debt holders will be though
Who would have thought that near free debt for extended periods could have come back to bite us in the arse
Darlings, the upcoming crash has been predicted long before now.
Not supply and demand, then goes on to describe supply and demand… 🤣
“not supply and demand. You could cover all your land in concrete and prices will still rise, so long as mainly foreign capital is free to invest in finite Irish assets.”
Assets are finite, capital to spend is higher, that’s supply and demand…
Ah so one of them finally decided to admit water is wet.
I’m not sure you can dismiss supply/demand dynamics that easily. Even if there’s a mass sell off by investment bodies it doesn’t solve the problem of having enough housing where it’s needed.
And if there is a mass selloff, speculators will be first in line to benefit rather than ordinary people due to lack of credit and a lack of regulation to prevent flipping.
Fucking Ray Charles can see this shit is unsustainable
Whenever everyone is saying there will never be a crash, that’s the time to bet on a crash.
Not to take away from them but anybody could have predicted 2008, Noonan did years before that, the economy was out of control. Our building sector was something like 50% the size of the UKs. Madness
Crash and burn
The thirst for a depression in r/Ireland is hilarious. If a crash happens you won’t get to take advantage as the wealthy will still outbid you
The only real certainty right now is uncertainty, over what’s going to happen in the next few months – and years.
It is looking like we’re on the edge of a major economic crisis/crash (possibly starting with a Lehman-type event in energy markets, which apparently are leveraging using financial instruments similar to those from 2008) – but…the shape of things is completely different now, we have stagflation, a real/massive energy supply shock, houses _are_ in short supply, and it is the corporate/financial world that is loaded-up with debt instead of households (and are benefiting from high inflation eroding the debt, when households suffered from _deflation_ worsening their debts post-2008).
So yes, things may be about to get very bad – but…it’s different than the last time, and usually this ends with the public losing and banking/finance winning – and I could see this crisis easily being shaped to force _even more_ people to rent rather than own, with _even more_ finance industry ownership of residential property.
A modest crash in property prices isn’t going to make them affordable to the average person anytime soon. I kind of doubt that’s going to lead to property changing hands from rentiers to homeowners.
Every bubble bursts eventually, you’re playing with fire if you allow it to grow unchecked.
We were always going back to this again. Always.
You don’t have to be an economist to see whats wrong. There’s thirty places to rent on daft in mayo. On a short term let website, there’s seventy. Policy in action.
Alarm bells for who though? Not the people getting screwed left and right by landlords and property developers/owners. It’s the lads in government with dozens of rental properties that will worry
Any economist that looks at the Irish housing market and doesn’t sound the alarm is not an economist worth listening to. There are some things so obvious it doesn’t take an expert to understand.
It’s incredible how many have read what she wrote but understood zilch, despite it being borderline spelled out. She’s not saying supply and demand isn’t a factor, she’s saying it’s a childish oversimplification and not adequate in explaining the housing crisis. She’s not implying we should literally flood Ireland in concrete housing, she means that even if we did, nothing of the sort solves the problem as long as foreign investors can purchase property as a form of safe investment. The Irish people simply cannot compete with investors who have more cash in hand available for a convenient transaction than Joe Average can get through a mortgage loan and months of dealing with solicitors and lenders.
The worst financial crisis of our times is coming, y’all better have a plan b
>“The idea that house prices are determined by supply & demand is an infantile view of how the market works. Asset prices in Ireland are very high, because there is a wall of money looking for somewhere safe to land — & property is regarded as a safe asset.
>That’s what is hiking prices in Ireland — not supply and demand. You could cover all your land in concrete and prices will still rise, so long as mainly foreign capital is free to invest in finite Irish assets.”
Is that not just supply & demand though? There are obviously various parties involved in the market; demand from investors is particularly high at the moment, so ordinary people looking to buy homes are competing with those investors for a finite supply of properties…
not supply and demand
So long as mainly foreign capital is free to invest in finite Irish assets.
So which is it? Not supply and demand or too much capital flowing in on a finite asset..
Watched a clip of the US fed chair being questioned about rate hikes and the impact on inflation, the hikes will not bring down the cost of energy, food prices or fix the bottlenecks in supply chains etc it will create a situation where businesses decide how to save money.. best way to save money is cut jobs.. which will set off a recession..
The fed chair mentions there’s 2 jobs to one employable person (wages go up in this situation).. the former fed chair said this needs to be higher because when It is higher then wages can come down (blaming wages being too high as the reason for inflation).. in turn keeping the money flowing up and trickling down..
What’s next ….. alarm bells sound that bears might use wooded areas for excretory purposes.
As a millennial , all I can say is a welcome the death of the economy , welcome and hurry up
She’s just plain wrong – if supply and demand is not a factor then what is ? There are levels and layers of supply and demand and frankly it is that simple , otherwise we would not have a housing crisis . She’s contradicting herself , that’s like saying huge oversupply didn’t cause the crash it was just the credit crunch
I dunno but I dont get the impression that shes hugely engaged with the actual specifics of the irish property market- as opposed to just applying her cookie cutter analysis.
And i say this as someone how is sale agreed but strongly suspects that I may be making a mistake , ie im not a mindless booster of irish property.
28 comments
*“The idea that house prices are determined by supply & demand is an infantile view of how the market works. Asset prices in Ireland are very high, because there is a wall of money looking for somewhere safe to land — & property is regarded as a safe asset”*
*“That’s what is hiking prices in Ireland — not supply and demand. You could cover all your land in concrete and prices will still rise, so long as mainly foreign capital is free to invest in finite Irish assets.*
*“Liquidity will at some point dry up, and that will have an impact on house prices. How? Think of how it impacted the US in 2007. In the movie The Big Short, the pole dancer suddenly couldn’t pay her mortgage, because in real terms her wages were falling. So it was people like her who brought down the whole financial system.*
*”That’s the point. People are taking out mortgages, they think everything is fine. But their mortgage rates are rising.*
*”Incomes in Ireland are very high for people in finance and tech. But that is not true for others who are borrowing to buy houses. There comes a point when energy and food inflation eats up more of their income and leaves less for the mortgage. That’s going to happen at some point — when, I’m not at all sure. But that’ll be the moment to worry.”*
Prices wont crash, there just isn’t any supply and the supply to crash the price is 5 to 10 years away. Why? I know far too many joint salary earning 100k and can’t afford a house as they are being out bidded still. If price go down marginally still far too many (like myself) that will jump at the chance to finally get a home.
I don’t know what’s worst between another buble bursting or this tbh, probably above.
Thanks Fine Gael / Fianna Fail.
This is partly why im voting sf. Ff and now fg repeating these mistakes and its no accident they both knew what would happen and didn’t act for whatever reason.
I disagree. I think the problem is supply lol
People who bought over the last year could be in real trouble. All debt holders will be though
Who would have thought that near free debt for extended periods could have come back to bite us in the arse
Darlings, the upcoming crash has been predicted long before now.
Not supply and demand, then goes on to describe supply and demand… 🤣
“not supply and demand. You could cover all your land in concrete and prices will still rise, so long as mainly foreign capital is free to invest in finite Irish assets.”
Assets are finite, capital to spend is higher, that’s supply and demand…
Ah so one of them finally decided to admit water is wet.
I’m not sure you can dismiss supply/demand dynamics that easily. Even if there’s a mass sell off by investment bodies it doesn’t solve the problem of having enough housing where it’s needed.
And if there is a mass selloff, speculators will be first in line to benefit rather than ordinary people due to lack of credit and a lack of regulation to prevent flipping.
Fucking Ray Charles can see this shit is unsustainable
Whenever everyone is saying there will never be a crash, that’s the time to bet on a crash.
Not to take away from them but anybody could have predicted 2008, Noonan did years before that, the economy was out of control. Our building sector was something like 50% the size of the UKs. Madness
Crash and burn
The thirst for a depression in r/Ireland is hilarious. If a crash happens you won’t get to take advantage as the wealthy will still outbid you
The only real certainty right now is uncertainty, over what’s going to happen in the next few months – and years.
It is looking like we’re on the edge of a major economic crisis/crash (possibly starting with a Lehman-type event in energy markets, which apparently are leveraging using financial instruments similar to those from 2008) – but…the shape of things is completely different now, we have stagflation, a real/massive energy supply shock, houses _are_ in short supply, and it is the corporate/financial world that is loaded-up with debt instead of households (and are benefiting from high inflation eroding the debt, when households suffered from _deflation_ worsening their debts post-2008).
So yes, things may be about to get very bad – but…it’s different than the last time, and usually this ends with the public losing and banking/finance winning – and I could see this crisis easily being shaped to force _even more_ people to rent rather than own, with _even more_ finance industry ownership of residential property.
A modest crash in property prices isn’t going to make them affordable to the average person anytime soon. I kind of doubt that’s going to lead to property changing hands from rentiers to homeowners.
Every bubble bursts eventually, you’re playing with fire if you allow it to grow unchecked.
We were always going back to this again. Always.
You don’t have to be an economist to see whats wrong. There’s thirty places to rent on daft in mayo. On a short term let website, there’s seventy. Policy in action.
Alarm bells for who though? Not the people getting screwed left and right by landlords and property developers/owners. It’s the lads in government with dozens of rental properties that will worry
Any economist that looks at the Irish housing market and doesn’t sound the alarm is not an economist worth listening to. There are some things so obvious it doesn’t take an expert to understand.
It’s incredible how many have read what she wrote but understood zilch, despite it being borderline spelled out. She’s not saying supply and demand isn’t a factor, she’s saying it’s a childish oversimplification and not adequate in explaining the housing crisis. She’s not implying we should literally flood Ireland in concrete housing, she means that even if we did, nothing of the sort solves the problem as long as foreign investors can purchase property as a form of safe investment. The Irish people simply cannot compete with investors who have more cash in hand available for a convenient transaction than Joe Average can get through a mortgage loan and months of dealing with solicitors and lenders.
The worst financial crisis of our times is coming, y’all better have a plan b
>“The idea that house prices are determined by supply & demand is an infantile view of how the market works. Asset prices in Ireland are very high, because there is a wall of money looking for somewhere safe to land — & property is regarded as a safe asset.
>That’s what is hiking prices in Ireland — not supply and demand. You could cover all your land in concrete and prices will still rise, so long as mainly foreign capital is free to invest in finite Irish assets.”
Is that not just supply & demand though? There are obviously various parties involved in the market; demand from investors is particularly high at the moment, so ordinary people looking to buy homes are competing with those investors for a finite supply of properties…
not supply and demand
So long as mainly foreign capital is free to invest in finite Irish assets.
So which is it? Not supply and demand or too much capital flowing in on a finite asset..
Watched a clip of the US fed chair being questioned about rate hikes and the impact on inflation, the hikes will not bring down the cost of energy, food prices or fix the bottlenecks in supply chains etc it will create a situation where businesses decide how to save money.. best way to save money is cut jobs.. which will set off a recession..
The fed chair mentions there’s 2 jobs to one employable person (wages go up in this situation).. the former fed chair said this needs to be higher because when It is higher then wages can come down (blaming wages being too high as the reason for inflation).. in turn keeping the money flowing up and trickling down..
What’s next ….. alarm bells sound that bears might use wooded areas for excretory purposes.
As a millennial , all I can say is a welcome the death of the economy , welcome and hurry up
She’s just plain wrong – if supply and demand is not a factor then what is ? There are levels and layers of supply and demand and frankly it is that simple , otherwise we would not have a housing crisis . She’s contradicting herself , that’s like saying huge oversupply didn’t cause the crash it was just the credit crunch
I dunno but I dont get the impression that shes hugely engaged with the actual specifics of the irish property market- as opposed to just applying her cookie cutter analysis.
And i say this as someone how is sale agreed but strongly suspects that I may be making a mistake , ie im not a mindless booster of irish property.