Frank Daly on Residential House Prices

The complications caused by the absence of a properly representative national house price index have been illustrated again via a speech given by NAMA’s Chairman Frank Daly (see NAMAWinelake here). Frank discusses NAMA’s assessment of the residential sector as follows:

On the residential sector the Central Bank is forecasting falls of 60% from peak (end 2006) to end 2012 under its adverse scenario or 55% under its baseline scenario – based we understand on the PTSB\ESRI index. At NAMA we are not surprised by this and it is not as alarming as one would first think. We do not believe that the PTSB\ESRI index currently showing close to 40% fall from peak is realistic and reflective of where the market is. NAMA’s base valuation date was November 2009 and at this date we were already taking account of on average 50% falls in residential property values from the peak.

So while the residential market may have some little more to fall and no one can be certain that an average fall of 60% from peak may not occur in residential house prices, we would believe that the bulk of this has happened already.

Based on my own anecdotal sample, I’m inclined to agree with Daly that residential prices have fallen more than shown by the PTSB\ESRI index. However, the implications for the Central Bank stress testing exercise strike me as a little more serious than Daly suggests. Daly indicates that most of the peak-to-trough decline envisaged in the Central Bank stress scenarios has already happened.

But this raises the question as to whether the stress scenarios should be based on a peak-to-trough calculations or should they be based on an assumption about a current level of prices and an additional assumption about further declines. It’s not clear why the scenarios should be based on a peak-to-trough assumption. And if, for example, the valuation of residential mortgage portfolios is based on an inaccurate assessment of current levels of house prices, then this may undermine the credibility of the calculations. I would hope that the report accompanying the stress test results would discuss this issue.

41 replies on “Frank Daly on Residential House Prices”

I really think the ESRI has questions to answer. To be clear what NAMA is saying –

“NAMA’s base valuation date was November 2009 and at this date we were already taking account of on average 50% falls in residential property values from the peak.”

In November 2009 the PTSB/ESRI index was showing a 29% decline from peak nationally. Since Nov 2009 there have been further falls so that at end Q4, 2010 the fall from peak nationally was 39%.

But NAMA which is a major owner of property in the State is saying 50% off peak in Nov 2009, PTSB/ESRI is saying 29% – that’s a 70% relative difference ((70% * 29%) + 29% = 50%)

PTSB appears to have less than 4% of the new mortgage market (according to last June 2010 6 month accounts) and even given a standard distribution of prices between mortgage lenders, and between cash/mortgage transactions, the best they would have would be an 8% margin of error at 95% confidence interval. But PTSB is different to other mortgage lenders and cash transactions are different to mortgage transactions so PTSB could easily be 40% +/-.

I have asked ESRI for a statement some time back and there was no reply. If I was a buyer in the last 12 months and based my buying decision on the PTSB/ESRI index I wouldn’t be very happy (assuming NAMA is right of course but it is the biggest property owner in the State and its valuers should be across most of the transactions so should be in a good position to give an assessment of price drops).

The PTSB index can show peak sale prices.

Is the anecdotal evidence based on peak sale prices or peak asking prices?

@ Jagdip

“I really think the ESRI has questions to answer.”

Is that not a bit harsh? PTSB give them the data and then they crank them.

The fact that the PTSB data is probably not representative any more is not the fault of the ESRI, who have flagged the issue of low sample sizes as a problem.

@Jagdip Singh
“assuming NAMA is right of course but it is the biggest property owner in the State and its valuers should be across most of the transactions so should be in a good position to give an assessment of price drops”

The cynic in me might say that as the biggest property owner in the state NAMA may hope that we are close to the bottom.

@Karl,

Is it harsh on ESRI?

I don’t think it is because the ESRI is the store of statistical expertise, not PTSB. The ESRI did change the index from monthly to quarterly in January 2010 citing low sample sizes but if you examine the four quarterly price series since then, there is no health warning that I can see suggesting that the series is anything other than a fair reflection of property prices.

If you take a look at DAFT.ie, you will see quite a few advertised price reductions which are in line with PTSB’s index and buyers might deduce from that, that the prices asked are reflective of the current market. NAMA would appear to be knocking that proposition out of the water with suggestion that prices were down 50% 16 months ago.

Here’s the link to the ESRI. There is no health warning on the quarterly series and there was no health warning on the monthly series which ended in Dec 2009 either.

http://www.esri.ie/irish_economy/permanent_tsbesri_house_p/

Harsh? Honestly don’t think so.

@D_E,

“NAMA may hope that we are close to the bottom”

Indeed that is the implication by the way, that we are at the bottom because if we were off 50% sixteen months ago then we might be off 60% today (NAMA doesn’t provide an uptodate current decline, it confusingly does refer to a current decline reported by PTSB – 40%)

Assuming PTSB was correct about the peak (€313k nationally at the start of 2007) then the average nationally today should be €157k if prices have remained flat since Nov 2009 or €125k if prices have dropped another 10% (of peak values) since Nov 2009 to date.

Many properties being sold nationally today at €125k?

when these folk talk of 50% average declines, are they weighting the average? For example apartments or property in outer commuter belt may fall more than city houses. You might also find that proportions of property types, which have dropped most, are concentrated at or near peak bubble.

I’m sure some property will have negative values before this is through.

why is there no register of sales prices would quickly eliminate all the speculation. What’s worse (for whom??) is that revealing the actual state of the residential mortgage would blow a further glaring hole banks balance sheets by revealing the true extent of negative equity. Furthermore residual valuations (the basis of valuation for “development” land) is based on residential sales prices – if these are optimistic, then the valuation figure on which the NAMA November ’09 valuation date is out by an exponential amount…..The commercial loan book was bad & the banks got NAMA, but the residential loan book is equally so.

If there is a problem with the TSB data, it would seem to be one of sample bias rather than sample size. If the problem was just about sample size, then errors would be as likely to be negative as positive. The index is stable enough so that it’s clear sampling error is not an overwhelming issue.

If the problem is one of severe sample bias, then one would expect the ESRI folks would investigate it, even if only out of intellectual curisosity.

To me the implicit confidence intervals are as important as the point estimates, and the difference between the base and adverse cases suggested to me some implausibly narrow confidence intervals.

“However, the implications for the Central Bank stress testing exercise strike me as a little more serious than Daly suggests…if, for example, the valuation of residential mortgage portfolios is based on an inaccurate assessment of current levels of house prices, then this may undermine the credibility of the calculations.”
+ the usual number of billions added on when the next stress tests to end all stress tests take place after this round.

A point to bear in mind when considering the PTSB/ESRI index – it is, I believe, the acknowledged HPI for Ireland. It is used to calculate LTV in covered bonds. As such, the Central Bank are talking about values declining with reference, I believe, to covered bonds or mortgage books generally. That this is totally divorced from reality is, as Mr. Whelan says, a lamentable state of affairs.

Of course, if the ESRI didn’t give its imprimatur to the PTSB index, perhaps it would not have been taken credibly in the past. Perhaps there would have been an earlier move to a proper public price register. Perhaps we’d know the price of houses… so I have to agree with Sri Jagdip on that one..

If Frank is right in saying that house prices had already fallen 50% by November 2009, there is plenty of anecdotal evidence to suggest that they have continued to fall since then. On this basis they could have already passed the 60% mark (or be approaching it)

This begs the question as to whether the CBI stress tests should relate to here and now prices or to those likely to apply in the next few years given that defaulting is a gradual process? If the latter, then the 60% peak-to-trough decline is (much) too low due to economic conditions, oversupply, emigration and likely interest rate increases.

The media regularly call PTSB the state’s largest mortgage provider yet they only have 4% of all accounts??

And where will housing prices be if, as seems likely, Trichet raises interest rates? Also default rates on mortgages? What interest rate environment is factored in to those bank stress tests.

@Rob S

“The media regularly call PTSB the state’s largest mortgage provider yet they only have 4% of all accounts??”

Both are correct.
PTSB used to have 20%+ of mortgage lending but that has dramatically fallen. Looking at the 790,000 extant mortgages, PTSB still has the most (80,000 SVR plus xx tracker and fixed) but looking at new mortgage lending today, PTSB’s share is less than 4% (calculated from the 2010 6 month accounts which indicated the value of new lending divided by the IBF-produced stats for banks representing 95%+ of total mortgage lending )

@Rob S
Come now, when were the non-business page media ever on the ball? You’ll be telling me next that you believed that Freddie Starr really did eat that hamster.

@Jagdip

Ah of course, was concentrating on the outstanding ones rather than the new ones

@hogan

They certainly don’t specify what they mean by largest like Jag did anyway!

Just for the record, the other house price index, the Dept of Environment one, shows a fall of similar magnitude to the ESRI one. This is what it gives for new and second-hand prices:

new house prices:

2007Q2 331,947 (peak)
2007Q3 319,214
2007Q4 314,333
2008Q1 311,113
2008Q2 313,678
2008Q3 301,680
2008Q4 282,023
2009Q1 255,029
2009Q2 241,288
2009Q3 233,189
2009Q4 226,505
2010Q1 226,245
2010Q2 226,833

fall between 2007 Q2 (peak) and 2010 Q2 (latest): -32%

second-hand house prices:

2007Q2 386,989 (peak)
2007Q3 374,392
2007Q4 366,912
2008Q1 359,277
2008Q2 356,638
2008Q3 335,762
2008Q4 323,418
2009Q1 297,294
2009Q2 286,952
2009Q3 254,754
2009Q4 244,679
2010Q1 247,534
2010Q2 279,839

fall between 2007 Q2 (peak) and 2010 Q2 (latest): -28%

So, it would appear that the ESRI/TSB and Dept of Environment indices are both wrong and not as accurate as anecdotal evidence.

For those who find the above figures offensive, may I point out that I have not actually compiled them myself. I am merely the messenger, having done nothing more than cut and pasted them from the Dept of Environment website. Complaints about them should be addressed to the Dept of Environment and not me. Of course, the figures are from the period when the evil Gormley was Minister. Now that there is a Fine Gael Minister, it is to be hoped that the Department can start producing more politically-correct figures.

Regarding residential rents, a similar situation of offensiveness pertains, in that both the CSO and DAFT figures show residential rents totally flat during 2010 and actually rising marginally towards the end of 2010, rather than the 10% fall that was widely predicted and anecdotally occurred. Indeed, the latest CSO figures, published only last week, showed a rise of 1% in residential rents in February, while the most recent DAFT figures showed a large fall in the stock of houses for rent and a slight uptick in rents. All clearly nonsense.

It would be outrageous if ESRI/TSB, Dept of Environment, CSO or DAFT figures were used in stress tests when everyone knows that anecdotal evidence is far more accurate.

“We do not believe that the PTSB\ESRI index currently showing close to 40% fall from peak is realistic and reflective of where the market is. NAMA’s base valuation date was November 2009 and at this date we were already taking account of on average 50% falls in residential property values from the peak.”

According to the NAMA business plan: “The eligible assets will be valued in line with a valuation methodology which has been approved by the EU Commission. Assets are evaluated using a discounted cash flow method taking into account the timing and reliability of the cash flows coupled with an appropriate discount factor to arrive at a current valuation.”

Since the base valuation seems to be based on discounted cash flows rather than sales in the market, I don’t see the relevance of their average 50% fall to the ESRI figure. I don’t see how NAMAs base valuation gives information on the accuracy of the PTSB\ESRI index unless it was in some way based on market transactions which doesn’t appear to be the case.

In the speech Frank Daly says “NAMA has also approved the sale of an estimated €2.7 billion (to end February 2011) in property assets held by debtors”. What data has been released in relation to these sales? e.g. is there a dataset with description of the property, the sale price, location etc.? It would seem to me that this data would give more information on the actual value falls observed by NAMA to date and provide another comparison to PTSB (although the composition of the samples may not be comparable)

Its incredible though that this long after the bust we are still relying on the voluntary provision of data by PTSB and daft.ie to work out what is happening with property prices, surely any legal issues relating to privacy concerns can be easily overcome to make the land registery data etc available?

@Jto

The CSO house price figures together with their unemployment statistics are bugbears for me, just as emigration at the ESRI is for you.

The CSO house prices are simple averages of mortgage transactions. They exclude cash transactions but their worst sin is that the figures are not hedonic so if there were two sales in a period, one of a €50k studio in Ballyfermot and one a €58m house on Shrewsbury Road, the CSO would report the average price as €29,025,000. It is a wonder how their figures are not more all over the place. The CSO, however, at least do explain their figures and issue a health warning note.

The bugbear with the CSO’s unemployment information is illustrated by asking any person in the street or indeed international media organisation or perhaps potential investor in the State how many are unemployed here and they will likely say “450,000” when in fact on an ILO basis there are less than 300,000 unemployed but the CSO still give most prominence to the Live Register which is different to ILO unemployment. Each month there is a Live Register figure published but only each quarter is unemployment measured. Personally I would like to see unemployment published each week just like the reams of information provided by us to the ECB and IMF – even if only published to the Cabinet, it might focus minds.

The frustration with residential property prices now is we do not have any detailed knowledge for the basis for NAMA’s assertion however true-ringing it may be. Frank says it is an average. We know that NAMA has access to most estate agents in the country on its valuation panel. Estate agents should know settled prices. So we might be optimistic that NAMA’s claim is accurate. But who knows and as Dreaded says, the implication from NAMA’s statement is that we are now in March 2011 at the bottom so, to use the words of former Minister Lenihan last April 4th, “you can buy now in confidence that the price is realistic” Hmmmm

As I say if I bought a house in Nov 2009 for a national average of €225k (according to the ESRI) and the true going rate was closer to €157k, then I would feel mighty upset at the ESRI.

The easiest – but somewhat unpleasant, way to quesstimate where res property prices are headed is to go through property pages of national newspapers published in mid-1990s.

Caveat: Regional factors are v important, ie, rural, simi-rural, ex-urb, sub-urb, inner metropolitan, etc. etc. So mean values are meaningless whether they apply to nature of property or to price.

There are several Rules-of-Thumb: Median salary of area/region is useful (with caveat in mind). Selling price of res property should be 2.5 times the median salary (you never include two salaries in any appraisal of house prices – there be complete financial madness!).

The other is the Iron Rule of Mortgages: 20:28:32. I’ll leave it to those interested to do some data-mining on these figures.

We are about half-way down from the summit toward sea-level.

BpW

The PTSB/ESRI index ceased to be of any relevance since January 2009.

3 bed semi-detached houses would be considered the bellwethers for the state of the market.

The August 2008 report still had 3-bed semis statistically counted:*
http://www.thepropertypin.com/viewtopic.php?p=129059#p129059

*I assume the spam filter is trapping the previous attempts to post multiple URLs – so I’ll do them one at a time:

@jagdap Singh

I know nothing of how the CSO/Dept of Environment compute their figures. My point was that, if anyone wishes to discard the ESRI/TSB figures and replace them with their own anecdotal figures, then they need to be aware that a totally different index using different methodology, the CSO//Dept of Environment index, is much closer to the ESRI/TSB index than their anecdotal figures.

From what I can find, there are 7 semi-official indexes relating to residential property in Ireland, 5 for house prices and 2 for rents. These are: (a) DofE new house prices (b) DofE second-hand house prices (c) ESRI new house prices (d) ESRI all house prices (e) DAFT asking prices (f) CSO rents (g) DAFT rents. It may well be that none of them is perfect. They may all have flaws. But, taken together, they show something. The peak-to latest falls for each of them are as follows:

(a) DofE new house prices : -31.7%
(b) DofE second-hand house prices: -27.7%
(c) ESRI/TSB new house prices: -34.5%
(d) ESRI/TSB all house prices: -38.3%
(e) Daft asking prices: -41.0%
(f) CSO rents: -21.0%
(g) DAFT rents -27.1%

None of them come close to the anecdotal ‘60.0%’. So, if ‘anecdotal’ is correct, ALL of the indexes must be wrong. Does anyone have an explanation as to why they are ALL wrong? I can’t think of any other country where the Central Bank would use ‘anecdotal’ figures rather than semi-official figures from quite a varirty of sources, however imperfect each one of them is. Let’s face it, the term ‘anecdotal’ means ‘I overheard it in the pub toilet on Monday night’. Anecdotally, statues quite often move in Ireland. Coming from The North, I prefer a more scientific approach.

It has already been widely acknowledged by the State that the lack of house price indices is a major problem. It is further hampering the market reaching trough and stabilising.

Whereas the current stamping process records that properties are residential and the price, that is about all it does. There is no mention of dwelling-type, floor area, no. of bedroms, garden size etc.

The CSO has been working on the problem. Unfortunately it is not a simple matter, especially in the absence of post codes. AFAIK they have had consultations with banks, the revenue, the property registration authority and professional bodies. It is not clear how forthcoming the Revenue have been in providing assistance as they can be quite difficult about letting anyone impinge on their bailiwick. The property registration authority are generally extremely progressive about such matters.

Graphic from Rogoff and Reinhart showing declines and time taken to reach trough are available here:
http://www.voxeu.org/index.php?q=node/2877

Kevin O’Rourke and Karl Whelan have highlighted how close the baseline and stressed declines are. Maybe that is justifiable on the basis that the rate of decline slows as one approaches trough. However, it is a bit alarming. One hopes the assumptions have not been changed to keep the results to anyone’s liking.

@Jto

That’s not a bad summary of house price surveys but you’re missing Myhome.ie and SherryFitzgerald’s surveys (their results are in the same statistical ballpark as DAFT.ie)

I referred to the CSO as the provider of a house price series. In fact it is the DoEHLG. I had always accessed the data through the CSO website and that is why I incorrectly attributed the information to the CSO. But to be clear the information comes from the Department of the Environment Heritage and Local Government. And my apologies if I have criticised the CSO unfairly as the source of these statistics.

Why are no traditional survey sources indicating 50-60% declines? Don’t know but the DoEHLG and PTSB/ESRI are mortgage-only transactions and anecdotally (in this sense meaning an exchange down the pub but also applying personal common sense) in a distressed market with credit restrictions, cash buyers may be able to get better deals. So my suggestion would be the exclusion of cash transactions.

Why don’t asking price surveys show 50-60% declines? Again don’t know but I’d guess they take their cue from the official surveys. Why would you advertise your home at 60% off peak if the PTSB/ESRI was saying prices were only 39% off?

What is plainly needed is the long awaited house price register so that NAMA, the Central Bank, banks, estate agents, builders, buyers and sellers
can see the real transaction values. In a housing depression, the government is neglectful by preventing this price discovery. Hopefully the house price register legislation which was tabled the week before the Dail was dissolved will be expeditiously dusted off and enacted.

Given that sample sizes were used in some posts above as a potential issue then to lessen the error the larger Daft.ie database would possibly be a better guide despite its known weaknesses. Take of instance the recent data on the Daft December report which were actually quite daft namely the 4 bed average house prices in Longford at €209k and 4 bed averages rentals at €665. Not on your life are these numbers a true reflection of market realities I know because I have had sight of recent rental agreements which verify significantly different numbers.

Nevertheless despite the criticisms the more accurate method in pricing housing and any risky asset for that matter is to look at the long run fundamentals surrounding it, In the case of property it’s the returns it can deliver over time namely rent discounted at the long run net average yield of 7%. All other methods in valuing property are inferior to the rent capitalisation method because it’s based on the assets earning capacity and not the earnings capacity of the mortgage holder which the banks and the Regulator still try to convince us to this day are relevant. They’re not.

The long run net yield on Irish Residential property is 7%. This is based on Govt numbers going back to 1976 from the DoE when they were first collected. Okay fully accept the data may not always have been the most accurate reflection of the entire market but unfortunately to my knowledge it’s the only long run yield data available in the ROI.

Given that the reversion to mean pricing is alive and well across all risky asset markets it’s not difficult to see Irish residential yields moving back to the 7% level given the oversupply in the market place, the lack of available credit, the lack of buyers, the lack of optimism generally – in fact all the obvious drivers for an improvement in house prices are clearly absent at this time so rental yields are on the drift higher. In relation to the Longford example a truer 4 bed rental in Longford is €500 pm i.e. a full 18% lower than that on the latest Daft survey. This is not anecdotal this is a fact.

Therefore talk from Frank Daly such that nobody knows where house prices will eventually fall to from peak to trough (PTT) is probably reasonable but what we do know is that at a minimum they will revert to a 7% yield. Irish risky asset markets will be no different to any other developed economy market and over the cycle and prices will mean revert.

Given this likely outcome the current PCAR assessments are odd.

Peak in house prices 100%

Fall per Daft to q4 2010 (Avg entire mkt) 39.8%

Net of peak prices at q4 2010 60.2%

PCAR expected falls for 2011 & 2012 on their base case would see prices settling at 44.64% of peak i.e. c55% falls against the Daft numbers.

Consider this on a yield however:

Peak yields per Daft were 3.1% recorded in q2 2007 and up to q4 2010 rents on average had fallen by 27.5% per Daft. If one assumes no further rental falls from here to end 2012 (which is clearly very optimistic) this would leave yields at the end of 2012 at the following:

3.1%*.72.5%/44.64% or 5% on the PTT falls assumptions under the PCAR base assumptions.

Now on the PCAR assumptions they have house prices rising in 2013 under both the base and adverse cases. In relation to my optimistic rent assumption of no further rental falls the yield per the PCAR settles at 5% and the end of 2012 and then starts to fall again in 2013. Folks this ain’t going to happen.

Mean reversion tells me that at the minimum we get to 7% yield before house prices start to rise and this means at the very minimum PTT falls of 68% will happen.

i.e. 3.1%*.72.5%/0.7 = 32.1% of peak prices i.e. minimum PTT falls of 68%.

Just to note the PCAR adverse scenario have yields rising to 5.6% based on PTT falls of 59.6% based on the Daft q4 2010 numbers – again on my assumption that rents remain stable from here to end 2012.

In short the PCAR assumptions on PTT house price falls do not stack up given that the majority of price falls to date are based on timeframes of record low ECB base rates.

I’d estimate a further 20% falls in rents at the average market level from here to end 2012 based on price per square foot estimates across Europe and the fact that as mentioned above rents are already off 18% against the some of the q4 2010 Daft numbers in many areas.

This would have prices falling c74% from peak to get back to 7% yields at the end 2012. Given a worsening Euro base rate environment then this to me should actually be the base case on the PCAR assessment as yields will likely push through 7% all other things being equal given ‘risk free’ alternative investments.

@JS: “Hopefully the house price register legislation which was tabled the week before the Dail was dissolved will be expeditiously dusted off and enacted.”

Hopefully you can hold your breath for some considerable duration – as in being underwater! Best possible taste you understand!

Disclosure of the true (aka: current market price), as opposed to the mental image values would cause lots of grief, political, economic and psychic. Best not go there.

There is neither need nor usefulness in speculating about res property prices, other than how much, and how fast they need to decline: A lot and slow(ly).

The time frame of decline is approx twice the length of time the property bubble took to reach peak (I est. that rise to be 8 yrs: 1995 – 2000: then a fall back of -2, then 2002 – 2006). That gives a 15-16 yr interval to revert to mean – which I est. to be mid-1990s values. Cert Par as they say, cept that Cert Par it sure ain’t.

Advice: Stay well clear of the res property market (other than renting) for a long time.

BpW

@Jadhip

any news on the house price index you have been asking for?

How in god’s name has it taken them so long to get this done?

@christy

The house price register, called for in the Kenny Report in 1974 and supported in principle by all governments since, but never implemented, is presently tabled in a bill, the Property Services (Regulation) Bill

The bill was tabled at the end of Jan 2011 just before the Dail was dissolved in February. It will be for the new govt to resurrect the bill.

The IMF and EU have called for a house price register as part of the bailout.

I don’t know what the new government, Phil Hogan and Alan Shatter in particular will do to push the bill forward. Society needs price discovery of residential prices but for the past 36 years successive governments have failed to deliver a register.

While I have read with interest on this thread and previous threads the discussion regarding lack of house price register i wanted to raise a point regarding the methodology of the stress test.

I have analysed the doelg new house price quarterly data since publication, adjusted it to reflect annual inflation at the time – the mean annual house price change in Dublin (since 1976) is 5.03% with a standard deviation of 11.55% (excluding inflation effects). Applying this to a current price the distribution could be plugged in to a valuation model to give an house value. i.e. 95% probability that prices will fall 13.97% or rise 24.02%.

However; I wonder should the problem not be approached from the perspective of affordability and demographic factors at a local level (given the segmented nature of the housing market cover all statements regarding house price falls are not appropriate) i.e. don’t use the sales comparison approach at all but use a multiple of gross household income and perform a valuation based on assigning a set of expected outcomes to this number?

@ BT: Your final # looks good.

Attempting to capture effect of the different variables is essential. Though it is a lot more effort. Most folk just want a single value – even if it is completely misleading. Nanometer attention spans!

BpW

To all.
re Influence of lack of credit on price of residential dwellings.

Anecdotal evidence is that a hospital consultant, albeit without a ‘permanent’ position, has been unable to get approval for a mortgage and has to rent property.
While house prices may still be high using an ROI calculation, the lack of house finance credit is a major issue driving down demand.

The stupidity at the “highest” levels of Irish society is inversely proportional to …. whatever.

Recession formulae are of no use in a depression!

There will be an overshoot. I humbly suggest that 2025 will see the trough in house values, as emigration tails off. Given that genuinely solvent banks will be in the market by then, I see average prices below 125,000, probably closer to 100,000.

Greed and faith in false economic beliefs are a powerful combination. Absence of accountability means that I have accounted for further scandals and problems in these values.

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