> In contrast, rents are a more reliable indicator of a shortage, no speculation there.
You'd think so, wouldn't you?
However, again the Irish market disproves this to some extent.
So generally you look at rents as a 12-14 year payback window of the house price (for investment). What happened in Ireland in the last decade is that rents increased, such that investors could pay more for houses, which increased rents etc etc.
Like, there's all this purpose built accommodation in Dublin that's sitting empty because they want 3k euro for a two bed apartment. For reference, a top 5% taxpayer would clear about 6-8k euro per month, so those prices are entirely out of whack with what people can afford.
But because it's all private capital, it's mark to myth so many of these apartments are empty. I work near the Central Bank, and there's loads of gorgeous six-eight floor blocks of apartments, all of which are entirely empty while we have far too many homeless people.
You'd think so, wouldn't you?
However, again the Irish market disproves this to some extent.
So generally you look at rents as a 12-14 year payback window of the house price (for investment). What happened in Ireland in the last decade is that rents increased, such that investors could pay more for houses, which increased rents etc etc.
Like, there's all this purpose built accommodation in Dublin that's sitting empty because they want 3k euro for a two bed apartment. For reference, a top 5% taxpayer would clear about 6-8k euro per month, so those prices are entirely out of whack with what people can afford.
But because it's all private capital, it's mark to myth so many of these apartments are empty. I work near the Central Bank, and there's loads of gorgeous six-eight floor blocks of apartments, all of which are entirely empty while we have far too many homeless people.