It's all about the economy

The economy and its sad state is all people here seem to talk about. When the Celtic Tiger was roaring all the Irish could talk about was how much money they were making. Now they've all realized what a deep hole they have invested themselves into. The banks made loans that only fueled the rise in house prices past what the average person could afford, and of course, nobody now can afford them, banks have stopped giving loans, and the whole housing market has stagnated.

Let me give some kind of idea as to the scope of the problem.

A good wage here would be € 40,000. The cheapest property for sale in my north County Dublin town is a 2-bed, 1 bath apartment in the not-so-nice part of town for €230,000. The cheapest stand-alone house is €250,000, and that's for a 1 bed 1 bath shack. The cheapest 3 bed property is €300,000, and that's for a townhouse. So when the cheapest property that becomes acceptable is around €400,000 Euro, which is 10x the average salary, well, we have a problem.

In the heady days of banks awash with money to lend, people were taking out 100% mortgages for up to 8x their salary. They are now well and truly screwed as many are losing their jobs and being driven into negative equity by declining prices. Many can't sell even if they wanted to. I want to buy, have a salary significantly above average, but can't get a mortgage (note that I haven't tried but haven't build up enough credit here yet). So who the hell can get those mortgages needed to get the market rolling again?

For now we'll rent, and the good news is that rental prices are dropping a lot too.