Quotes of the Week 29/02

“At current transaction rates, the available housing supply is closer to 14 months worth of supply. We are now in the middle of the Spring selling season. Newsflow over the coming weeks will have a large bearing on the outlook for prices, and indeed output plans, over the coming quarters.” – Dermot O’Leary, Economist, Goodbody Stockbrokers.

"Prices have bottomed out and people are starting to move." - Wade Wise, Residential Director, Savills HOK.

‘‘The value of commercial property will increasingly be driven by sustainability and climate change issues. The move to create low carbon buildings will accelerate and both occupiers and investors will drive this shift, motivated by corporate social responsibility, brand value, the desire to reduce energy costs and the need to future-proof their properties.” - Mark Woodall, Chief Executive, Climate Change Capital.

“Last September Cushman & Wakefield’s European Cities Monitor found that top executives ranked Dublin 12th out of 33 cities in terms of value for money office accommodation. This was followed two weeks ago by the Lisney Rental Indices which found that office rents had remained stable during 2007. With the global economy slowing and with Ireland’s cost competitiveness now coming into sharper focus, this is clearly good news for corporate occupiers”. – John McCarthy, Head of Research, Lisney.

‘The new policy guidance is clearly focused on proactively addressing the issue of taking in charge at the pre-planning stage. This approach coupled with the extensive powers already available to planning authorities to deal with non compliance will ensure that the legacy of unfinished estates is consigned to the past.’ - Minister for the Environment, Heritage and Local Government, Mr. John Gormley.

“Germany is now established as a core investment market in Europe, accounting for 22% of turnover in 2007. We are still seeing large amounts of capital seeking opportunities in the market and this demand is keeping investment yields stable. Many investors, including Irish investors who invested more than €1 billion in Germany in 2007, are focussing on investing in German real estate on the back of the rental growth potential in key cities such as Frankfurt, Munich, Berlin and Hamburg.” - Peter Schreppel, Head of International Investment, Frankfurt office, CB Richard Ellis.

“In the current environment, investors need to focus on core property fundamentals of property investment, namely good buildings in prime locations let at sensible market rents. This type of investment should benefit from rental growth in the coming years, which will be the primary driver of performance. The market has now changed from a debt-driven market to an equity driven market, so Irish buyers will be competing with cash investors. To counteract this, Irish buyers will have to have their debt in place and move quickly to get the best property investment opportunities in 2008.” - Caroline McCarthy, Head of Overseas Investment, Dublin office, CB Richard Ellis.

‘‘They should have master-planned a mini-town for the area [Sandyford] and, instead, they allowed developers to essentially build whatever they wanted out there. It’s turning into an awful mess. The roads are a mess and there’s too much stuff being built for the Luas to cope with.” – Unnamed property industry source, Sunday Business Post.

Property searching in Polish

The ERA Ireland website offers property hunters the chance to choose to search in Polish. Unfortunately, it is only the standard content of the site that is translated and the information on individual properties is only available in English.

Surely at this stage in this demographic shift, there's some competitive advantage to be had for some canny agency to provide actual property information in Polish, and perhaps even employing a Polish-speaking negotiator.

One for everyone in the audience

In an attempt to attract buyers back into the market, developers of new homes have recently been using a number of innovative methods. Most notably, of course, price reductions top this list as well as offers to pay the mortgage for a certain period of time or to stump up part of the required deposit. Membership of an adjacent golf course is also a favoured sweetner. Kings Court in Castlepollard, Co Westmeath provides the prospective buyer with one of three options: free childcare for two years, a new car or a full turnkey furnishing with every home. All are inclusive in the overall price but which one would you prefer?

You've taken our survey ...

THANK YOU VERY MUCH FOR YOUR HELP.

NOW TAKE ANOTHER IF YOU LIKE

Quotes of the Week 22/02

‘We are now seeing first-time buyers out viewing properties. Most of these buyers are already loan-approved and have been for several months - many were in the market last summer but they decided to rent until the market steadied. We are now seeing price reductions in play and first-time buyers are semiseriously starting to buy and make bids, albeit under the asking prices.’ - Paul Murgatroyd, economist, Douglas Newman Good.

“Houses are sitting on the market because there are so few buyers out there, so those that want to buy are in a better position” - Marie Hunt, director of research, CB Richard Ellis.

‘‘Second-hand homes are on a price par with newly built homes - there is no longer an advantage to buying a new development over a second-hand property so we’re seeing lots of activity from first-time buyers in the market” - Trina Beakey, manager, Savills Hamilton Osborne King Phibsboro.

‘‘Second-hand properties offer even better value since the abolition of stamp duty for first-time buyers and new build properties no longer have that advantage over our market. And all the prices of existing stock have been reduced in the last few months -most vendors have reduced their prices and the take-up in sales is improving.” - Ronan O’Hara, Savills Hamilton Osborne King Dun Laoghaire.

“The responsibility of Government is to protect individuals from actions by others which may harm them. In this case, that responsibility has been thrown onto organisations like ours, which has an exemplary record … At the end of the day, we can’t regulate people who aren’t members, - that is the job of Government, and they should act. It is absolutely insane that our Government would sit back and allow the public to be exposed to people who in many cases haven’t the first idea of what they should be doing, and in many more cases, think they can get away with out doing it anyway.” - Robert Ganly, President of the IAVI.

"I was on the city council throughout that process [of the Local Area Plan] and we rejected the intensification of the developments in that area and on that site. It is clear the planners ignored the wishes of the councillors … Either we respect the rules or the guidelines that are set down under the development plan which is provided for in statute or we don't. It is this type of ignoring development plans that have led to all sorts of problems across Dublin." - Lucinda Creighton, Dublin South East TD, commenting on Dublin City Council’s decision to grant planning permission for Glenkerrin’s 15-storey Ballsbridge development.

"There is still off-market activity with some hard negotiations taking place to get deals across the line. Cash-rich developers are closely monitoring the market with a view to picking up any bargains that emerge" - Stephen Cassidy, Savills Hamilton Osborne King.

“Although price levels are still significantly higher than at this stage last year, the final quarter of 2007 saw prices levels come down and the volume of transactions fall, particularly in the [Northern Ireland] second-hand market … The affordability gap for first-time buyers is narrowing but the early indications from 2008 suggest a market that is still stricken with relative inactivity, uncertainty and nervousness over valuations,” - Louise Brown, University of Ulster.

Waiter, can you sell my house for me?

We were comparing notes with a friend of ours with knowledge of the US estate agent world, and he was saying things are similarly tough at the moment in the property market there. He knows of a restaurant in his town where four of the waiting staff are real estate agents - trying to keep the property sales going in the background but having to do nights at tables to keep the wolf from the door. Typically, I'd imagine they are using it as an opportunity - on the look out for new vendors, keeping an ear out for property related gossip, and possibly leaving their card with the bill instead of the restaurants. Could be the way forward!

Kelly Hudson sign up to RE/MAX

Kelly Hudson Properties of Newbridge has signed up to RE/MAX.

Previously with RE/MAX Newbridge, John Kelly of Kelly Hudson opened his own straight-talking property brokerage.

With RE/Max Newbridge now closed, he has chosen to continue his own agency under the RE/MAX umbrella, as Newbridge's RE/MAX Achievers.

IAVI & PropertyNews.com?

Anyone got any idea why the IAVI has PropertyNews.com's logo on their homepage? Why would they be promoting this private business over others?

On a related matter, we notice that funda.ie is still live but is anyone still using it?

What's your opinion on this one? ....

According to the Business Post: "One third of the 170,000 new homes added to the Irish market over the past two years have not been sold, according to an analysis of new figures by The Sunday Business Post." One third of new homes unsold as slowdown hits (17 February 2008 By David Clerkin, Markets Correspondent)

What do you think? You can leave a comment, anonymously, just by clicking on Comment below.

Quotes of the Week 15/02

"If you want to sell your houses cut your prices" - Housing Minister Batt O'Keeffe.

“We listed a three-bed semi in the Donaghmede area recently, at a very realistic price in the €350,000 to €375,000 bracket, and shook hands on a deal three days later. It shows the interest that can be created when a property is realistically priced - the phones literally did not stop ringing for that house in a 24-hour period.” - Conor Gallagher, Partner, Douglas Newman Good.

‘‘Based on the level of enquiries we’ve had, we are expecting to sell around 50 at Hansfield, at least 40 at Waterville, and at least 25 at Mimosa … It is the first-time buyers who are dominating sales at the moment; investors are definitely out looking, but they’re not buying yet.” - Catherine O’Connor, Savills HOK.

“In the vast majority of cases, 2008 prices have been set in the context of current market conditions and, with housing output dropping, further cuts later in the year are unlikely. It is also the case that, despite a global economic slowdown, salaries in Ireland will continue to rise this year, which is good news for potential first-time buyers who are scrutinising affordability. The net effect is that the price reductions that have already taken place alongside salary increases have negated any overvaluation in the market.” - Hubert Fitzpatrick, Director, Irish Home Builders’ Association.

"The purchase of a home is a significant life event and with the large sums of money involved, it is vital that the profession meets the highest standards. While the majority of estate agents and auctioneers do an excellent job, concerns and problems remain." – Consumers’ Association of Ireland.

“Rents have now stopped increasing for the first time since they started to rise in mid-2004, when Ireland opened its labour markets to the new EU members.” - Ronan Lyons, Economist, Daft.ie.

‘The study has been received by me and I have decided, in line with the recommendations in the study, not to commence this provision at this time … I have to consider the state of the property market before the provision comes into effect, to ensure that it does not have an unforeseen negative effect on the market.’ - Minister for Finance, Brian Cowen, reverses a decision to scrap a tax avoidance scheme used by property developers.

“We anticipate some slowdown in the demand for office space as corporate occupiers respond to a slowing global economy. With the financial services industry responsible for 45% of Dublin office take last year, demand could be particularly sensitive to turbulence in global financial markets.” – Dr. John McCartney, Head of Research, Lisney.

“The mortgage market continues to adjust to more sustainable levels of new lending. That said, within a market that continues to grow in absolute terms and now stands at €140 billion, the first-time buyer share is staying consistently strong, the residential investment letting segment is proving resilient and activity in the switching market is intensifying.” - Pat Farrell, Chief Executive, IBF.

"We've had road rage and air rage and now this. It seems to be a sad reflection of modern society that some people resort to this kind of behaviour and it seems to take very little for them to boil over" - Dessie Larkin, Donegal County Councilor - commenting on the decision to offer self-protection training to planning staff.

119 Howth Road

The details of 119 Howth Road were finally revealed last week following the development’s launch on Tuesday.

The scheme contains 52 apartments, referred to as ‘suites’. Suggestive terms like this are scattered throughout the upmarket website and brochure, and with good reason. At 119 Howth Road, Errisford Developments have set new standards for Dublin’s ‘lifestyle’ developments. Think of living in a hotel, not - “Good evening, Mr. Fawlty” , but - “Did Sir enjoy Sir’s cognac?”

Recently, property developers have recognised that some buyers can be enticed by accompanying schemes with upmarket personal services. One of the first developers to capitalise tap into this market was Glenkerrin homes when they released ‘The Grange’ - Dublin’s first scheme to include a concierge service.

119 Howth Road also has a permanent concierge. Along with this is advertised the availability of a personal shopper; personal trainer; masseur; private chef; and service maid. Access to a private jet and helicopter is also mentioned but, as with many of the aforementioned staff, this is surely just a booking service. Additionally, the scheme features a members club, a conference room, and a health centre. To complete the luxury, the development is architecturally modelled on the Louvre, and even includes the famous glass pyramid.

These features and services are marketed as the primary selling points of the development. Indeed, when reviewing the scheme’s marketing material, it is not until after a few short movies and a full brochure that you arrive at information about floor space or bedroom numbers, despite the 52 units being larger than average.

The development itself has been designed to impress, and it succeeds. The entrance to the 4-floor building is at the Northeast through a large and stylish foyer. The apartments are contained across three sides of a courtyard with the Southwest aspect left open. At first, the replica glass pyramid looks somewhat tacky as the centre piece of the courtyard. It is however, the ceiling to the underground pool and health centre and a very cleverly designed feature.

After a marketing campaign that promised something special, it’s fair to say that 119 Howth Road has delivered.

The five stages of property grief

Buying a property is one of the most draining things the average person ever has to endure. While thicker-skinned investors cope more easily, the level of emotion that the first-time-buyer invests in the property purchasing process means that its highs and lows are enough to leave them a gibbering, shivering heap on the floor.

For this reason, buying a property sometimes compared to grieving as one of the most stressful times of one’s life.

It follows that as one can map five emotional stages of grieving, so one might be able to identify 5 emotional stages of property hunting grief.

Stage one: Denial – ‘it’s not happening’

“There is no way that we’ll end up paying that much for a house. The market will fall apart any day now or a really cheap one will come along. That is just far too much money to ask for four walls and a roof. And a 40 year mortgage? Not a chance!”

Stage two: Anger – ‘it’s not happening fairly’

“Bloody investors! They got into the market at the right time and now we’re getting ripped off so that they never have to work another day. And agents? -don’t even get me started on them! – There’s no way that place was in need of just slight modernisation’

Stage three: Bargaining – ‘it’s not happening their way, no way!’

“Alright, they’re asking for €450,000 but €390,000 is still a lot of money. I mean, I’d love that much money! Surely that’s enough for them … OK €400,000 then!”

Stage four: Depression – ‘it’s not happening at all’

“What’s the point in arranging all these viewings? We’re never going to be able to afford a nice place. Maybe we should just move country or something.”

Stage five: Acceptance – ‘it’s happening … someday’

“OK, so the market is the market and we have to accept that and become more realistic about our expectations. We need to stop becoming so emotionally involved and at some point the right property will come along.”

By the way, stage five is where the savvy agent pounces: The initial enthusiasm for solo house hunting has been drained from the purchasers, their defences are weakened, and expectations are significantly lowered. They’re suddenly interested in a greater variety of houses, and a “good agent” may even be able to persuade them to buy something they would never thought they wanted. But, of course, a “good” agent would never dream of doing such a thing, now would they!

Quotes of the Week 08/02

‘The uncertainty in the housing market in the last 12 months is now being reflected in the dramatic fall off in supply. This will curtail choice for new home buyers later in 2008. Current evidence illustrates that it is now cheaper to buy one's own home rather than renting, a situation that is unlikely to be sustained in the future with reductions in housing completions on the cards.’ - Hubert Fitzpatrick, Director, Irish Home Builders Association.

“The further house prices fall, the greater the positive impact on affordability and the greater the support for the housing market in the future. Indeed, following the recent price falls, and with official interest rates on hold since mid-2007, the deterioration in affordability has now halted and is beginning to improve… our analysis indicates that a fall in prices of around 15% from their peak (at the start of 2007) could well improve affordability conditions sufficiently to restore some momentum to the Irish housing market. – AIB Irish housing market update.

“Ireland, and in particular Dublin, has some of the highest retail rents in Europe. A booming economy, limited shopping centre space and strong consumer demand has underwritten this segment of the economy for the past decade. However, this support is beginning to turn.” - UBS report on commercial property that predicted a 30% fall in prices.

“If the property market cycle in Ireland is to follow the long-term trend, we can expect that total returns in the Irish market will certainly revert to single digits in 2008 as in previous cycles. However, a drop in values of 30 per cent is not on the cards” – Marie Hunt, Director of Research, CBRE.

"To say the commercial market could take a 30 per cent hit doesn't reflect what's happening on the ground. If anything is taking a hit, it's development land.” – Robert Ganly, Knight Frank.

“This latest (MyHome.ie NCB) Barometer Report confirms that we are now firmly in a buyers market. However, the further drops in asking Prices over the final quarter of 2007 indicate that sellers are beginning to face up to the reality of the market and accept lower prices. Estate agents are reporting some increase in transaction activity but it will take more time to clear the overhang of stock in the market.” - Jim Miley, Chief executive of MyHome.ie

“There are serious concerns that Minister Cowen's prediction of housing completions in 2008 is over-optimistic. This will mean further shortfalls throughout the year as tax revenue from new houses falls short of targets" – Fine Gael’s finance spokesman, Richard Bruton.

“I don’t accept we overheated the economy. We dealt with conditions as they were …The opportunity arose to do things and they were done. But look at the evidence, look at how our position compares to other countries.” – Finance Minister Brian Cowen.

“The way we currently treat foreign dividends, a key aspect of our foreign direct investment regime, badly needs an overhaul to keep up with European competition. Instead, what we got (in the Revenue Commissioners new regulations) is more likely to scare foreign investors away because of its complexity.” - Brian Keegan, director of taxation with the Institute of Chartered Accountants of Ireland.

Did you get this faxed to your offices?

Launch night at 119 Howth Road?

For a little over two months, WSM have been advertising their enigma at 119 Howth Road.

Following the introduction to the theme and a brief good tidings message over Christmas the banner has read:

'Looks like we're ready Patrick'

'Excellent Mr. W'

'Be prepared for a night of activity'

'Do we have a date Mr. W?'

'February 5^th! And all will be revealed!!!'

So, tonight all will be revaled. I know what's going to happen at 119 Howth Road because I've looked at the planning records. My guess is that tonight will be the launch night for the development, but who are Patrick and Mr. W?

Whatever happens, I'm eager to see if they can deliver on the suggestive marketing campaign.

Quotes of the Week 01/02

"After a decade of phenomenal growth, the market finally came off the boil in 2007. However prices today are pretty close to where they were at the start of 2006 and the fundamentals behind the market remain strong – as evidenced by rising rents. There is clearly demand for new houses albeit at reduced levels. The question is at what point buyers will take confidence that we’re at the top of the interest rate cycle and return to buy.” – Niall O’Grady, Head of Marketing at Permanent TSB

‘‘The latest activity is because buyers do see more value in the market. Everyone’s negotiating and negotiating hard.” – Adam Clarke, Savills Hamilton Osborne King Clontarf.

"While we think confidence in the Irish housing market is unlikely to improve rapidly, a clear turn in the interest rate cycle, a further small easing in house prices in coming months, an improving trend in affordability, a sharp reduction in supply and signs of resilience in the Irish economy suggest that after a challenging start to the year, 2008 could end with the Irish housing market on a steadier footing." - Austin Hughes, IIB Bank chief economist.

"I think they're heading for a great fall [in value]. A lot of the building sites in Gorey have come to a standstill. It's a scary time." – Homeowner in Gorey, Irish Independent.

"Even if one were to accept that high rise is a necessity, and we do not accept this, the architecture involved in some of the high-rise buildings that have been allowed by Dublin city council planners is quite extraordinary." - The National Conservation and Heritage Group

“Unfortunately, our research shows that many players in the property industry are merely paying lip service to the whole energy rating process. The majority of property owners and developers are not implementing any meaningful energy-efficiency measures in either their old buildings or their new buildings and, until the impetus comes from bottom up – i.e. from consumers, tenants or shareholders – and thus creates a value differential, our fear is that property owners and developers will continue to do nothing” - Dr Clare Eriksson and Stephanie McMahon; Jones Lang LaSalle European wide sustainability in property survey.