4 ms·

"Oh why won't someone think of the poor house prices!" - wsj As a homeowner I don't mind if house prices fall, that means more people will be able to afford to

"Oh why won't someone think of the poor house prices!" - wsj As a homeowner I don't mind if house prices fall, that means more people will be able to afford to live in their own house. I still get to live in a house. It's a win win, until I try and sell my house and small amount of that imagined house value is gone, but maybe living in a farer society makes up for that.

bilekas 3y ago
Unfortunately though you seem to be in the minority. There is ganging up on the "boomer" generation in Irepand for example because they buy up all the properties they can specifically to rent out for exorbitant prices. This is encouraged. So when there is legislation or regulations that would reduce the price inflation of properties they are the first to complain. They usually have more political influence too by way of being regular voters etc. And so instead of the mentality you share, they don't see owning properties other than a means of "semi passive" income.
- disgruntledphd2 3y ago
  Do you have a source for your assertions about the Irish property market? Like, as a landlord in Ireland you'll pay 52% tax on your rental income, and while you can claim tax relief on the interest, it doesn't make a lot of financial sense to borrow relatively expensive money for rentals. It made a lot more sense 10 years ago, but the data would seem to suggest that it's not a massive driver of sales right now. Like the Irish property market is insane right now, but I suspect that much more of the rental purchases are driven by small investment companies as that makes much, much more sense from a tax and overall expense purposes.
  - bombcar 3y ago
    The rental market in the USA for sure is greatly distorted by the people who think there is “guaranteed easy money” to be made. They’re the type who say “mortgage $1500, rent $1600, it’s free real estate.” Sadly for them, eventually they learn why professional landlords want to see debt service be 50% or less of revenues. And it’s not because they get to pocket 50%. It’s been covered up because appreciation has been so high as to cover the bad accounting, but a few years of increased rates and near zero appreciation will put the hurt on them - and then watch out!
  - bilekas 3y ago
    If you're a landlord you're most likely not borrowing large amounts on the properties you're renting out. Its more common that those properties were bought years before when prices were achievable. There are some good statistics here in the CSO (Central Statistic Office) for Ireland. https://www.cso.ie/en/releasesandpublications/ep/p-cp1hii/cp1hii/tr/ https://www.cso.ie/en/releasesandpublications/ep/p-cp1hii/cp... A bit further down you can find the age gaps between "Outright ownership" "Figure 3.5 Tenure status by age of householder, 2016" Particularly glaring. > I suspect that much more of the rental purchases are driven by small investment companies On this topic, yes for new builds, pretty much investment companies will come in and buy them up prior to being built. This has always been a thing, but is not helping the situation for normal people just looking to buy somewhere to live. Edit : Another infuriating thing they did was for the 2022 Census, the obfoscuated so much of the data, made a presentation in powerpoint and after easily 20 mins of searching : https://www.cso.ie/en/releasesandpublications/ep/p-cpp2/censusofpopulation2022profile2-housinginireland/publicationbriefing/ https://www.cso.ie/en/releasesandpublications/ep/p-cpp2/cens... They managed to take a master class is bad Chart/Informatics design. For the age variations, I swear they changes the green RGB but 1.
ehnto 3y ago
Speculation on housing is really the super-heater I think. Housing prices in major cities seem to be based on a different market to demand for housing as a place to live.
spondylosaurus 3y ago
It sucks how homeownership is supposed to serve this dual role of "having a place to live" and "having an infinitely appreciating asset" when the two are fundamentally at odds with each other. I'm with you, though—as long as I can afford to live here, the value of my house doesn't matter so much because I like it and don't want to sell it. But part of me knows (and hates) that this house is also the biggest slice of my net worth, and its value heavily impacts any future financial leverage...
- refurb 3y ago
  having an infinitely appreciating asset It wasn't always viewed that way in the US until the past few decades. And in many places, it's not viewed that way at all, more of a "store of wealth", rather than a "good investment".
  - bombcar 3y ago
    At best housing should roughly keep pace with inflation itself (and this is what it did for decades, perhaps even centuries depending on how you account for things) and therefor should kind of be “money losing” if you count depreciation and repair (and ignore the value of having a place to live). And until quite recently, in most of the country, this basically help, once you factored out size increase (modern housing stock is much larger on average than housing stock from the 50s or even 70s even as families are smaller) and also factor out mechanical improvements - modern houses are built better in many ways that do cost more. I wish more of the indicies that track this stuff did more to track the land and the improvements separately. Because most of the increase in valuation of land comes from the old farmhouse now being inside the city boundaries.
    - refurb 3y ago
      At best housing should roughly keep pace with inflation itself That's Robert Shiller's claim when you look at average home prices across the entire country over a long enough period. Contrary to popular belief, there has been no continuous uptrend in home prices in the US and the home prices show a strong tendency to return to their 1890 level in real terms. Moreover, he illustrates how the pattern of changes in home prices bears no relation to changes in construction costs, interest rates or population
nephanth 3y ago
You can't both see housing as an investment and expect it to never fall. Investing carries risk

bilekas 3y ago

Unfortunately though you seem to be in the minority. There is ganging up on the "boomer" generation in Irepand for example because they buy up all the properties they can specifically to rent out for exorbitant prices. This is encouraged. So when there is legislation or regulations that would reduce the price inflation of properties they are the first to complain. They usually have more political influence too by way of being regular voters etc. And so instead of the mentality you share, they don't see owning properties other than a means of "semi passive" income.

disgruntledphd2 3y ago
Do you have a source for your assertions about the Irish property market? Like, as a landlord in Ireland you'll pay 52% tax on your rental income, and while you can claim tax relief on the interest, it doesn't make a lot of financial sense to borrow relatively expensive money for rentals. It made a lot more sense 10 years ago, but the data would seem to suggest that it's not a massive driver of sales right now. Like the Irish property market is insane right now, but I suspect that much more of the rental purchases are driven by small investment companies as that makes much, much more sense from a tax and overall expense purposes.
- bombcar 3y ago
  The rental market in the USA for sure is greatly distorted by the people who think there is “guaranteed easy money” to be made. They’re the type who say “mortgage $1500, rent $1600, it’s free real estate.” Sadly for them, eventually they learn why professional landlords want to see debt service be 50% or less of revenues. And it’s not because they get to pocket 50%. It’s been covered up because appreciation has been so high as to cover the bad accounting, but a few years of increased rates and near zero appreciation will put the hurt on them - and then watch out!
- bilekas 3y ago
  If you're a landlord you're most likely not borrowing large amounts on the properties you're renting out. Its more common that those properties were bought years before when prices were achievable. There are some good statistics here in the CSO (Central Statistic Office) for Ireland. https://www.cso.ie/en/releasesandpublications/ep/p-cp1hii/cp1hii/tr/ https://www.cso.ie/en/releasesandpublications/ep/p-cp1hii/cp... A bit further down you can find the age gaps between "Outright ownership" "Figure 3.5 Tenure status by age of householder, 2016" Particularly glaring. > I suspect that much more of the rental purchases are driven by small investment companies On this topic, yes for new builds, pretty much investment companies will come in and buy them up prior to being built. This has always been a thing, but is not helping the situation for normal people just looking to buy somewhere to live. Edit : Another infuriating thing they did was for the 2022 Census, the obfoscuated so much of the data, made a presentation in powerpoint and after easily 20 mins of searching : https://www.cso.ie/en/releasesandpublications/ep/p-cpp2/censusofpopulation2022profile2-housinginireland/publicationbriefing/ https://www.cso.ie/en/releasesandpublications/ep/p-cpp2/cens... They managed to take a master class is bad Chart/Informatics design. For the age variations, I swear they changes the green RGB but 1.

ehnto 3y ago

Speculation on housing is really the super-heater I think. Housing prices in major cities seem to be based on a different market to demand for housing as a place to live.

spondylosaurus 3y ago

It sucks how homeownership is supposed to serve this dual role of "having a place to live" and "having an infinitely appreciating asset" when the two are fundamentally at odds with each other. I'm with you, though—as long as I can afford to live here, the value of my house doesn't matter so much because I like it and don't want to sell it. But part of me knows (and hates) that this house is also the biggest slice of my net worth, and its value heavily impacts any future financial leverage...

refurb 3y ago
having an infinitely appreciating asset It wasn't always viewed that way in the US until the past few decades. And in many places, it's not viewed that way at all, more of a "store of wealth", rather than a "good investment".
- bombcar 3y ago
  At best housing should roughly keep pace with inflation itself (and this is what it did for decades, perhaps even centuries depending on how you account for things) and therefor should kind of be “money losing” if you count depreciation and repair (and ignore the value of having a place to live). And until quite recently, in most of the country, this basically help, once you factored out size increase (modern housing stock is much larger on average than housing stock from the 50s or even 70s even as families are smaller) and also factor out mechanical improvements - modern houses are built better in many ways that do cost more. I wish more of the indicies that track this stuff did more to track the land and the improvements separately. Because most of the increase in valuation of land comes from the old farmhouse now being inside the city boundaries.
  - refurb 3y ago
    At best housing should roughly keep pace with inflation itself That's Robert Shiller's claim when you look at average home prices across the entire country over a long enough period. Contrary to popular belief, there has been no continuous uptrend in home prices in the US and the home prices show a strong tendency to return to their 1890 level in real terms. Moreover, he illustrates how the pattern of changes in home prices bears no relation to changes in construction costs, interest rates or population

nephanth 3y ago

You can't both see housing as an investment and expect it to never fall. Investing carries risk