Daft Property - Irish Property News

The ordinary citizens of this State would be well entitled to ask if there is some point in the near future when we will stop being burnt by the great ongoing bonfire of the vanities of our former Celtic Tiger masters. They would be right, for such now is our 'state of chassis' that the Moriarty Tribunal ceased to be the central issue of public discourse after little more than two days. But when it comes to issues of survival, ethics will always come second to economics. Yet ethics is not unimportant either, for the issues Justice Moriarty dealt with cut to the heart of the colossal political failure of the first Irish Republic. Once again, another tribunal has revealed that we as a State are utterly incapable of governing or policing ourselves. And unfortunately this failure even extends to a tribunal which after 14 years of investigation has only provided us with the prologue to the resolution of the controversy about the mobile phone licence. The outside world, on wh...

Growing dole queues expose fragility of Irish economy... Unemployment figures show Ireland cannot afford to lose a single multinational – but this is not stopping France and Germany trying to force it to raise corporation tax: Sometimes you have to wonder if the rest of Europe understands the fragility of Ireland's economy. Do the Germans and French not understand that there is a prospect of zero growth in the economy in the next three years and that forcing multinationals out of the country could finish Ireland off altogether? Their constant attacks on Ireland's low corporation tax rate have even got on the nerves of Ryanair's Michael O'Leary, who has warned that any increase will jeopardise the country's ability to pay off its debts. Figures out on Tuesday showed a surprise rise in unemployment. Yet Ireland swiftly came under attack again for its low corporation tax of 12.5%, as if this was any part of a fix for the challenging times ahead. German fina...

'FOR God's sake, Sarge, say something, even if it's only goodbye!" The old joke about the platoon of soldiers about to march over a cliff carries relevance for a Taoiseach and a Government out of step with everybody else and refusing to acknowledge the proximity of the cliff. For much of the last week, the story of Ireland's trouble has jostled for prominence in the headlines with massive world events. It has preoccupied leaders at international conferences. It has filled the pages of the 'Financial Times' and attracted the attention of the media in Europe and the United States. It has provoked comment, almost unanimously gloomy, from leading economists. But "Sarge" has had nothing to say beyond a reassurance that we have enough money in the kitty to last us until the middle of next year. After that, who knows? At any rate, Sarge thinks the cliff is a long way off. Brian Cowen is reportedly "furious" about the reports that we may seek to...

"If you thought the bank bailout was bad, wait until the mortgage defaults hit home." THE BIG PICTURE: Ireland is effectively insolvent – the next crisis will be mass home mortgage default, writes MORGAN KELLY ... SAD NEWS just in from Our Lady of the Eurozone Hospital: After a sudden worsening in her condition, the Irish Patient, formerly known as the Irish Republic, has been moved into intensive care and put on artificial ventilation. While a hospital spokesman, Jean-Claude Trichet, tried to sound upbeat, there is no prospect that the Patient will recover. It will be remembered that, after a lengthy period of poverty following her acrimonious divorce from her English partner, in the 1990s Ireland succeeded in turning her life around, educating herself, and holding down a steady job. Although her increasingly riotous lifestyle over the last decade had raised some concerns, the Irish Patient’s fate was sealed by a botched emergency intervention on September 29th, 2008 followe...

LOW-paid workers will be dragged into the taxation net and middle-income earners also face a wide range of tax hikes in the most draconian Budget in the State's history. Taoiseach Brian Cowen yesterday quelled pressure from within Fianna Fail to call an election and will push ahead with plans to cut €6bn in the 2011 Budget on December 7. After being forced to call a by-election in Donegal South-West, the embattled Coalition is now facing the prospect of its majority being reduced to just two for the crucial Budget votes. But Mr Cowen is adamant the Government will stay the course and see through the €6bn austerity package for next year, consisting of spending cuts of €4.5bn and €1.5bn in increased taxes. The Coalition also expects 45,000 workers to emigrate from the country in 2011, leading to just a small rise in unemployment as those who can't get jobs will opt to leave the country instead. For those in the workforce, the prospect of a wide range of tax hikes is on the cards,...

Cowen issues warning about hairshirt budget: 'Major hole' in tax base must be filled... TAOISEACH Brian Cowen last night set the scene for a hairshirt Budget by delivering a stark warning about the state of the public finances. In an off-script address at a chamber of commerce event in Monaghan, he said he wanted to bring it down to "brass tacks", instead of talking about all the zeros and the billions. He said the Government was trying to fix the "major hole" in its tax base, following the disappearance of one third of revenues due to the economic crisis. "This year, we're spending €50bn and our revenue base is €32bn. Let's put that in context. One half of total revenue is being devoted to the health service presently," he said. Mr Cowen went on to say that social welfare, including pensions, child benefit and disability benefit, accounted for two-thirds of tax revenue. "So if you were to take health and social welfare alone, you woul...

Doomsday media coverage and the matter of the truth... A bit like the rain in a Frank McCourt novel, the bad news on the economy never stops pouring down on us. That picture of Ireland now seems firmly set in the opinion of the international media. Once the sick patient of Europe dutifully taking its medicine to help it get better, we are now, as the doctors might say, experiencing an adverse clinical event that is threatening our very life. The cure might be killing us. Last week's extremely disappointing news that the economy had contracted again by 1.2% in the second quarter added yet another symptom to the many more that erupted within just a few days: international bond market rates at record levels upping the price of government debt and therefore necessitating an even worse budget; long-term unemployment up; emigration up; 110,000 households in arrears on electricity and gas bills. The list of damaging symptoms was endless. All last week, international commentary from the Wa...

A drunken Premier playing right into the hands of the EU Can one bank bring down a country? At the end of August, a reporter from the New York Times asked that question about Ireland's bust Anglo Irish Bank. The Dublin government denied such a thing were possible. Yet now it is looking very much like it might happen. Anglo's debts are so vast that the government may have to pay 34billion euros to bail-out the bank. Bail-outs for other Irish banks will bring the total to 50billion euros. Party animal: Irish Premier Brian Cowen and admirers at a Fianna Fail function Brian Lenihan, the finance minister, was forced to admit yesterday that these bail-out costs will push the national deficit this year to 32 per cent of GDP. Such figures would be shocking in Britain. Even at its worst, Britain's deficit is heading for little more than 10 per cent. However in Ireland, where the entire working population numbers just 1.8million and unemployment is at 14 per cent, figures like that a...

THE number of Irish people being forced to emigrate to find work has hit a 20-year high, with the numbers edging towards the 30,000 level. The level of overall emigration, including non-Irish nationals, has remained constant at 65,300. But the number of Irish nationals leaving these shores including families was 27,700 in April, up 42pc on last year. Migration from other countries to Ireland has also slumped. The number of migrants dropped significantly to 30,800 in April from 57,300 last year, according to new figures from the Central Statistics Office (CSO). The figures also show the highest level of net outward migration to 34,500 in April since 1989. Economists said yesterday that our youngest and brightest are being forced out of the country to find jobs because of slump in the economy. "The bulk of this is forced emigration," said Friends First economist Jim Power. "What we're doing is what we did very well in the 1980s and it is unambiguously negative. "T...

Selling off state assets on the cheap is just madness... This Government will not contemplate selling property just in case it would bankrupt the banks. The State's argument is that the market is depressed so if we were to sell the land, we would not get a fair price for it. So we will postpone the problem: we get NAMA -- a financial skip into which the banks throw their worthless mistakes -- and you pay. The logic of NAMA and this Government's central strategy is to wait for the value of land to improve before selling. Whether you agree with it or not, this is their logic. It can be summed up by: "Don't sell land in a depressed market." Yet at the same time, the Government has just announced that it will sell real assets via privatisation in a similarly depressed market. So why can it sell ESB -- a real company with real assets -- and not a field in Athlone which is worthless and should command the price a farmer would pay you to put a donkey grazing on it? Why i...

We're paying high price for blind eyes and denial... No event in the past 40 years, apart from the Arms Crisis of 1970, has been shrouded in as much state secrecy as the bank guarantee scheme introduced on the night of September 28, 2008. While everyone knows the outcome of the various meetings -- €485bn of liabilities were ultimately guaranteed -- only a small circle knows precisely what happened during the shuttle diplomacy between the banks and Brian Cowen's Government that night. Two books have been written, several newspaper accounts have been published and one or two of the participants have even spoken briefly about that fateful evening. But detailed, minuted information about the key decisions and key moments leading up to the guarantee has never been released. In fact a slew of Freedom of Information requests seeking these details has been flatly rejected, with the Department of Finance using highly charged language to explain why the public and the media cannot see su...

Government still avoiding public inquiry into the economic crash... The Government coalition parties did not want a comprehensive public inquiry into the reasons for the banking and economic crash. Instead, they have ended up reluctantly endorsing no less than three mini-inquiries into aspects of the banks here that will, of course, be conducted largely in private. In January, Taoiseach Brian Cowen endorsed setting up two inquiries - one into the evident failures of the financial regulator in recent years and the reckless amounts of money advanced by the banks. The new broom at the central bank, the TCD academic Patrick Honohan, said he favoured a banking inquiry. Governor Honohan then set out to report on the huge failings of the reformed organisation he now leads. Separately, two outsiders, the German Klaus Regling and Englishman Max Watson, were appointed to investigate the reckless lending by the bankers. Messrs Regling and Watson reportedly talked to a clutch of Ireland's form...

Burden of Irish debt could yet eclipse that of Greece... OPINION: What will sink us, unfortunately but inevitably, are the huge costs of the September 2008 bank bailout... IT IS no longer a question of whether Ireland will go bust, but when. Unlike Greece, our woes do not stem from government debt, but instead from the government’s open-ended guarantee to cover the losses of the banking system out of its citizens’ wallets. Even under the most optimistic assumptions about government spending cuts and bank losses, by 2012 Ireland will have a worse ratio of debt to national income than the one that is sinking Greece. On the face of it, Ireland’s debt position does not appear catastrophic. At the start of the year, Ireland’s government debt was two- thirds of GDP: only half the Greek level. (The State also has financial assets equal to a quarter of GDP, but so do most governments, so we will focus on the total debt.) Because of the economic collapse here, the Government is adding to this d...

The great property scam is back to rip us off again... They're back! The creeps, the snake-oil salesmen and spoofers who condemned a generation to negative equity are cheerleading again. The advertisers are salivating too because the "property porn" industry sees a chance to sell its fantasy again. The papers are once more displaying "dream homes" replete with doctored photographs and Mediterranean blue skies -- all at "knock down" prices. It's time to buy again, or so I'm reliably told by those who were so reliable last time that they gave us NAMA! I am not saying that property won't recover ever, of course it will; but not from here. Irish property is still extortionately expensive. It is expensive not just on a comparative basis but, more crucially, it is expensive on the basis of what is happening in the economy. Any government that is urging people to buy houses right now clearly has no intention of learning anything from the mistakes ...

Mortgage timebomb will cause new banks crisis when it goes off... The recommendation that the moratorium on repossessions should be extended by a further year is another sign that the clock is ticking on our €150bn mortgage time bomb. Last year all of the main banks and building societies agreed not to repossess the homes of people whose mortgages were in arrears for at least 12 months. Now, with the 12-month moratorium about to expire for many of those in arrears, there are fears that the number of homeowners facing repossession could rocket. For some it has already happened. Entertainer Adele King (better known as Twink) revealed that her family home was about to be repossessed by her lender. Twink's statement came on the same day that the Oireachtas Committee on Social and Family Affairs recommended the 12-month moratorium on home repossessions be extended to 24 months. The recommendation comes just 11 days after the Financial Regulator extended the 12-month repossession morator...

Pressure on State to stop repossession of homes... There is a "substantial" number of new mortgage holders who should never have been approved for the amount of money they borrowed and repossession orders should not be granted to their lenders, proposals to Finance Minister Brian Lenihan and the Oireachtas committee have urged. A group, whose aim is finding a way to assist thousands of families who face the "very real threat" of losing their homes because of mortgage arrears, said the terms of loans should be amended to what the borrower can afford. The Prevention of Family Home Repossession Group has made submissions to Mr Lenihan and the Joint Oireachtas Committee on Finance and Public Service on a variety of measures to deal with the problem. They have also warned that many families will find themselves in a poverty trap with a deteriorating economy, spiralling unemployment and the prospect of interest rate rises . "This has the potential to lead to catastro...

State should start printing money to rescue economy... Did you know that our country's housing wealth has shrunk at a rate of €142.8m per day since the peak of the boom in 2007? This is a catastrophic figure because housing wealth was one of the key drivers of spending, and domestic spending is what kept the dole queues so low in the boom years. Without this housing "feel-good factor" we will continue to spend less. And the housing situation is getting more alarming. In January 2007, the total value of all our houses and apartments was €550.64bn and today that figure is €411.69bn. According to the latest report from daft.ie, rents are collapsing back to 1999 levels. Many people believed that, even in the worst case scenario, the housing market would bottom at 2003/4 levels. This now looks optimistic. The more rents fall, the more house prices fall too and this is because the rents are a leading indicator of what is happening to real housing demand. There is such an over...