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Irish House Prices Crash - Boom To Bust

It's Boom To Bust for Ireland - in fact there are so many reports out that it's hard to keep up with them all!


Here's a section of an Irish Times report tôday:

"HOUSE PRICES plummeted in April as developers began to offload a glut of unsold houses at knock-down prices. But potential buyers grew more nervous about committing to the plunging property market, new figures show.

The drop in the price of new homes was almost twice the national rate, as builders were forced to discount prices in an effort to sell a backlog of houses and apartments rather than wait for a bounce in the market.

But figures from the Central Bank show that consumers have so far proved reluctant to take them up on the offer in great numbers, with the growth in mortgage lending last month falling to its slowest rate since 1992.

The monthly drop in house prices accelerated from 0.7 per cent in March to 1.1 per cent in April, making it increasingly unlikely that the housing market will turn around this year...

There were further signs that the Republic's housing boom has turned to bust at the High Court, as a provisional liquidator was appointed to two related property development companies...

Banks are now reluctant to lend vast sums of money to the beleaguered property sector, leaving developers with unsold stock exposed to cash-flow problems. Lenders have also imposed stricter lending criteria on individual mortgage borrowers.

Alan McQuaid, an economist at stockbroking firm Bloxham, said the increasingly sluggish rates of mortgage lending were "more evidence of a slowing Irish economy".

House prices fell 3.3 per cent in the first four months of 2008, exacerbating a 7.3 per cent decline in prices in 2007. The trend has left thousands of homeowners in negative equity, where their home is worth less than the value of their mortgage."

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