okay in this video i want to talk about something that's quite topical and which raises temperatures
to put it mildly depending on whether you own a house or are trying to get on the
property ladder the question of house prices the value of houses the affordability and whether
houses are overpriced whether there's going to be a crash whether they are simply not worth it or
all of these issues and i'm here to tell you based on my experience and based on observation
that this is not a straightforward matter there's a number of scenarios there's a
number of different circumstances let's just say i'm going to put a number of them to you now
in this and i think by the end of this video i think you might have a slightly different view
about how much a house is worth any house first thing to understand is what is a house worth
it's worth whatever you can get for it in the open market in other words if there's a willing
buyer and a willing seller whatever the willing buyer is prepared to pay provided there's no
exceptional circumstances surrounding it then a house is worth whatever the market is prepared to
pay for it and the market you only require one person to come along and give you the price so
you need to understand at the outset there's no point saying that such a house was bought
in 1986 for 50 grand and now it's selling for 250 grand and there's no way it's worth 250 grand why
because i'm comparing it with the house selling for the same house selling for 50 grand in 1986
that quite frankly is nonsense the house is worth 250 grand if somebody some person some man or
woman comes along and is prepared to pay 250 grand for it okay that's the starting point i want to
put a number of different scenarios to you however consider two houses for example for the moment
i do a lot of conveyancing here in my practice in enfield and i am doing convincing in the
likes of calvin liedram russ common mayo kerry cork dublin kildare mead
westmead you name it i've probably done convincing in most counties in the country let's just say for
the sake of argument at the moment i have a client buying a house in canada or in
cavern let's just say a cabin or let's say longford or let's say was common i could tell
you where to go in any of those counties today to buy a house for between 60 and 100 grand
you might say jesus who wants to live in cavan or longford or is common with all due respect
to those counties and to the citizens of those counties however you'd be surprised because
some people some people can work from home and i have a client who's buying a property
in litrum or in caven or in longford or wherever and they're actually able to work from home so for
that person a house is very very affordable they can buy one for around about a hundred grand and
they're perfectly happy with it you might say i don't want to live in the country et cetera
that's fair enough but in terms of comparing the houses the 60 grand house in let's say
cavern at the 250 grand house let's say in enfield or indeed in dublin if you can get one
which is the better value you might say that if you're stuck below in leeds room
or cavan or roscommon or long for some place you've paid a hundred grand for a house you're
nowhere near public services you're no where near public transport and you're
nowhere near educational establishments and you're nowhere near jobs then you might say
paying 350 grand to buy a house in dublin by comparison because it's got public transport
it's got services it's got jobs it's got third level institution educational institutions and so
on you might actually say that a house in dublin for 350 grand is better valued on a house in say
longford or us common or leads from for a hundred grand it'll very much depend on the circumstances
and it'll depend on where you are in your stage in life as well because you may want some place
to retire if you want some place to retire you're not going to want to go into dublin and pay 350
grand for a house to be close to third level institutions if your kids are up and gone and
if you have no intention of working and likewise you may be happy enough to go down the country
but when you go down the country then you may have a problem in terms of public service and
in terms of the public transport you might find no bosses are not trained so you're going to weigh up
the situation between say a 60 grand house or 100 grand house down the country versus a 350 grand
house in dublin and it may well be the case that the underground house is great value for you or it
may well be the case that it's actually a better value for you to buy the house at dublin for 350k
is the house in dublin worth 350k you tell me because if you're prepared to pay it and if you're
prepared to pay to have the proximity to the services that i've spoken about add to jobs and
so on well then it is worth 350 grand you might say it's expensive but what's expensive because
the house is worth whatever anyone is prepared to pay for it the second scenario that i want to
look at is the average industrial wage let's say the average industrial wage in ireland is let's
just for the sake of argument we'll say 40 grand i don't know what it is let's say it's 40 grand
and let's say the average house is 80 grand that's twice the average industrial wage
and you might say that's fantastic i can buy a house for twice the average industrial wage
and that's fair enough but let's say the average industrial wage is 150 grand twice the average
industrial wage down is 300 000 you can then buy a house for 300 grand so is a house at 80 grand
or 300 grand which of them is the best value obviously how much you're earning and the average
industrial wage would be a factor because if the average price of a house for example is half a
million but the average industrial wage is 250 grand then two times your average annual salary
will buy you a house that's fantastic value so is the house then for 500 grand expensive not at all
it's a bargain it's cheap as chips because you can buy it for two times the average industrial wage
as i say it's a hypothetical situation but i'm simply putting the scenario to you
that uh the question of the value of a house how much is a house worth is not a nominal or absolute
figure it will depend on other factors it will depend on location it will depend on the proximity
to jobs and services it will depend on the average industrial wage and then if we go back to
say 1986 when i bought my first property versus today in 1986 i can remember paying
interest rates of 18 i can remember at the same time unemployment rates of well in excess of
20 and i can remember inflation being very very high and i can remember as i say unemployment and
inflation and rather interest rates going through the roof back then you could buy a property
for small money i bought a property for small money but i was paying interest at 18 whereas i
if i got the opportunity to pay twice as much for my property what could get cheap money like
i could get today at two or three or four percent that's again a different scenario so you compare
1986 versus today today you have interest rates and you have money at two three four percent
or whatever it is versus 18 back then today you have practically full employment versus
massive unemployment and immigration back then and compare the economy today in ireland one of
the wealthiest economies in the world versus practically going bankrupt back in 1986-87
three general elections in the space of 15 months the country was absolutely on its uppers
and was talked about the imf the international monetary fund coming in and ireland basically
declaring bankruptcy again you're going to compare 1986 versus today you might say a property in
1986 at 60 grand jesus i love that that would be fantastic but as i say if you couldn't get a job
if you had no income and if interest rates for 18 then the 60 000 euro house isn't so cheap whereas
today a house by comparison at 350 grand if you're earning good money if the economy is strong and if
the interest rate on the money you borrow is low maybe it's better to buy a house now at 350 grand
versus the 60 grand you might have paid then so you can see that the question of
what is a house worth the question of our houses overpriced is it a good time to buy jesus the
market has got a crash a house you know that house as i say sold for 60 grand back in 1986 and i was
selling for 250 grand i bought a property back in 1989 or 90 and i bought it for 147
000 euros it's worth over a million now but the point is that and i don't own it anymore but the
point is that back then 1989 or whatever and money was hard to come by and it was expensive 147 000 i
can guarantee it was a lot of money and yet today it would look like a bargain so you can't be too
absolute i don't believe about how much a house is worth or whether houses are overpriced you need to
look at the context you need to look at interest rates you need to look at inflation you need
to look at the proximity to jobs and to services you need to look at proximity to public transport
you need to look at the availability of work you need to look at the average industrial wage you
need to look at a lot of factors so i'm saying to you that a house for me or for you in say a cabin
or say longford for a hundred grand could actually be a more expensive house than one in dublin for
350 grand depending on the circumstances and vice versa it would be lunacy for me
if i wanted to retire and if i could work from home and do a bit of part-time consulting
it would be lunacy probably for me to buy a house in dublin for 350 grand
if i could buy a nice little cottage below and go away or long further in cabin or some place
for 60 or 70 grand but again it will depend on the circumstances so beware of people telling
you that houses are underpriced or overpriced or bad value or good value or anything else
you must be very very careful and you must weigh up all the circumstances yourself but you must
as best you can take into account the likes of inflation the likes of interest rates the likes
of the average industrial wage etc etc and the house stand is worth whatever somebody is prepared
to pay for hope you find this video thought provoking useful i'm sure you don't agree with
much of us i'm sure you might agree with some of it leave a comment down below i'd be interested
in hearing your views but this is not a black and white situation this is not a one-size-fits-all
scenario this is not a situation where you can say i'm going to sit tight do nothing and house
prices are going to fall because it's a much more complex question than that and obviously the whole
question of supply and demand will feed into the equation as well anyway i hope i've given you some
food for thought um i'd appreciate if you gave it the thumbs up down below the video the thumbs up
down below on youtube and you may be interested in subscribing to my youtube channel thanks a lot
you