Comments on: Major estate agency brands CSO house price index results “absurd”

By: i luv ny

i luv ny — Wed, 23 Jan 2013 14:20:46 +0000

Forget ex-pats and embassy workers, anecdotal evidence from the US says that the supply of Chinese cash buyers of distressed homes is practically infinite, Have they shown up in Ireland in force yet?

By: Small Change

Small Change — Wed, 23 Jan 2013 14:11:26 +0000

What exactly is the logic behind Cash Buyer headline figress?
When we say “Cash buyers account for 45% of all sales”, does this mean
A. 45% of all sales were cash-only, or
B. 45% of the total funding for sales came from case (and the other 55% from mortgages)

If the answer is B, then the level of transactions excluded by the CSO figures would be a lot less than the headline figures suggest, given that all mortgage-backed purchases will have varying levels of cash associated with them depending on the LTV

By: conchubhairb

conchubhairb — Wed, 23 Jan 2013 10:26:15 +0000

The Lisney objections say it all – if cash buyers are providing the majority of the fuel for housing demand, then the demand for housing is inflated. Cash buyers are not a sustainable prop for property prices unless their supply of cash is sustainable. London and NY have a sustainable supply of cash buyers from non-national (eg oil rich) sources – apart from a tiny number of Irish ex-pats returning home, or statistically insignificant numbers like embassy workers, the source of cash for the majority of Irish cash rich buyers must be property boom money, with a few wealthy pensioners thrown in. So their utility curves are arguably different from mortgage holders, they may be more prone to taking a punt on a price, and most importantly their supply is finite. So when cash buyers dwindle (since there is no significant profits to be made in property speculation in this market) So if you’re looking for the long term “real” price trends for Irish property, mortgage buyers must surely be it. So CSO is accurate?

By: seniorpropertyobserver

seniorpropertyobserver — Tue, 22 Jan 2013 18:25:25 +0000

NWL Your example of the Acacia Avenue sales indicates clearly that houses sold for cash are invariably cheaper than prices achieved using a mortgage.This is also demonstrated in the Allsop auctions.No doubt cash is king and those fortunate to have it can call the tune on property prices.As previously blogged it is felt that if Daft or some other bright spark could extrapolate the data from the Property Price Register which includes all transactions both cash and mortgage then and only then will we have a clear index of the true extent of the crash(albeit since 2010)which I predict (at this point)as being 60% from peak with further falls to follow(Fitch and Moodys) together with the shape of whats coming down the tracks in next 3 years budget wise.(each household down about €5000) before a levelling off.

By: robuachalla (@robuachalla)

robuachalla (@robuachalla) — Tue, 22 Jan 2013 15:42:38 +0000

Sorry, for “MIS” read “MIR”

By: robuachalla (@robuachalla)

robuachalla (@robuachalla) — Tue, 22 Jan 2013 15:42:02 +0000

Standard EA fare, really. If the CSO agrees with them, they talk it up. If it disagrees with them, they run it down. I was actually expecting a bump in December due to the end of MIS, however perhaps that was too tight a deadline for most and that bump was really seen in November only.

“In 2013, we are of the view that prices in Dublin and other city areas will increase further and it will be the cash buyers who drive this”

Right. Because that’s what drives most housing markets. The endless supply of cash buyers.