‘’WELCOME HOME!!’’……. picture this scenario Ireland 2015, 7 years after the crash & mass emigration, the young Irish are returning (not so young anymore maybe) , the Country is getting back on its feet, the economy has improved, there are jobs on offer again and new opportunities are beginning to present themselves. Excellent news! But hold up a second, we have one problem….Where are they all going to live??? Not only confined to those that are returning, people are struggling to find homes to live in, whether it’s to rent or to buy.
The elephant in the room has returned and its ‘HOUSES’, short supply, pent up demand, rising rents….all sounds a bit familiar doesn’t it? But it’s true, it’s all true, there is a ‘short supply’, buyers are scrambling for the limited stock on offer and rents are literally going through the roof.
David McWilliams recent article on Facebook highlighting the numbers on the Census in relation to the housing stock in Ireland, McWilliams started ‘Did you know that in total, the census revealed that there were 289,451 vacant properties (14.5% of total stock)? 59,395 were holiday homes. In any ordinary housing market, approximately 6% of properties would be expected to be vacant (120,000 in the Irish case) meaning that oversupply is about 110,000! We don’t have too few houses, we have actually too many’. David McWilliams reckons ‘We have loads of bloody houses!’
‘There are lies, damned lies and statistics’…….WHERE ARE ALL THE EMPTY HOUSES???? Clarinwood?, Newtown Glen?, Monvoy Valley?, in Tramore? No. Collins Avenue? Grace Dieu?, Clover Meadows?, in Waterford? No. Pebble Beach (one of the most improved communities, look at the property price register if you don’t believe me)? No. The truth is that in places where the majority want to live, commute to work and raise a family there is a severe undersupply.
As we move steadily out of the ‘recovery phase’ of a new residential property cycle, what is going to happen next? The continued limited offering of property will have a natural effect on the housing market, when supply is short and demand is high: Prices will rise significantly. The central bank credit limitations have yet to have an impact outside of the capital and will do little to inhibit purchaser demand for a few more years to come.