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Fears Grow Over Housing Market Slowdown...

Not a single new home registered by Premier in January...


THE private housing market could be in danger of grinding to a complete halt with one of the two home-registration firms in the country not registering a single house in January.

The Irish Independent has learned that Premier Guarantee did not register a single housing unit in January, with its larger rival Homebond only registering 149 houses, including just 24 in Dublin.

At the peak of the property market in 2006, Homebond was registering 6,122 houses a month or about 72,000 in a full year. Premier, the smaller of the two registration services, was registering about 2,117 houses per month, or almost 25,000 per annum.

Of the 149 houses registered with Homebond in January, 62 were in Cork, 16 in Kildare and 24 in Dublin. In most of the other counties there were less than three houses registered, with many counties only registering a single house.

One of the few things propping up the housing market now is one-off housing which often doesn't depend on insurance from either Homebond or Premier. Local authority housing, which is also continuing, normally has some form of state insurance behind it.

The warranties provided by the companies also protect a homeowner's deposit in the event that their builder goes bust. Homebond has been operating since the late 1970s and has only faced competition from Premier since 2002. Willis Risk Services offers the Premier product in Ireland.

Economists regard the house registration figures as the best indication of housing starts. Once a house is registered with either of the two companies the builder and then the owner has cover for any serious structural problems that arise in the first 10 years after construction.

The collapse in prices, rising unemployment and a lack of mortgage finance has seriously hurt the housing market, with first-time buyers also finding it hard to come up with deposits to make purchases. In some parts of the country the overhang of existing stock will not be cleared for many years.

Banks have changed their loan-to-value rules forcing purchasers to come up with more of their own finance. Credit standards have also been tightened in other areas, for example long-term mortgage loans over 40 years have been restricted along with 100pc mortgages.

Average national house prices in Ireland fell by 18.5pc in 2009, according to the Permanent tsb/ESRI House Price Index, with prices declining by 3.6pc in December alone. The full-year decline of 18.5pc compared to a reduction of 9.1pc in 2008.


Report by Emmet Oliver - Irish Independent.

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