Daft Property - Irish Property News

Property crash wipes €257bn off value of homes in six years... IRELAND'S homeowners have collectively lost an estimated €257bn in property value in the six years since the market began to crumble, the Irish Independent can reveal. The 50pc collapse in value since the peak of 2007 also means that by the Central Bank's own estimates, Ireland's crash has now become the worst experienced by any country in the world. The combined loss to the owners of Irish residential properties since the bubble burst equates to almost four times Ireland's total bailout sum of €67.5bn and more than half the total amount of money first set aside in the European Union's €500bn Financial Stability Facility. The PTSB/ESRI Index, Ireland's former national price barometer, showed average house prices standing at €310,632 at the start of 2007. An estimated drop of 50pc in value puts the average loss to an Irish household at €155,316. With 1.6 million households across the co

We're being seduced by property porn again – will we ever learn? LAST week the "glossy brigade" was out in force. Papers were full of bright, impossibly blue skies, over "imposing" homes many of which "boasted" this feature or that attribute. Yes, the glossy brigade, Ireland's property pornographers, who pedal lifestyle fetishes to the middle classes are back at a newspaper close to you. Amazingly, just six years after a property crash, which destroyed much of the economy, chatter about house prices appears to be back, or at least, out of social quarantine. Any day soon, expect a new TV programme on house hunting, the joys of home makeovers or the allure of trading up. Why do we allow ourselves to be taken in by this nonsense? Every spring since the crash, the estate agents and the property industry have tried to re-launch the property market with puff pieces, hard selling and gimmicks. Yet underneath the hype, the evidence from the hous

Another year over, what do we know? Five years on from the crash, what have we learned? There is no magic solution but we are still thinking like an island. In the end, not even sex could sell Belmayne. Nearly six years ago the north Dublin estate seared itself in the nation’s memory, with images of couples cavorting on kitchen counters, all in the desperate hope of arousing interest in an increasingly flaccid property market. At the now infamous launch party, the developer of Belmayne, Donal Caulfield, wearing a diamante-studded Roberto Cavalli beanie, promised buyers “gorgeous living” in four-bedroom houses with curved walls, all for €600,000.  (Below: one of the famous “gorgeous living” ads) The “gorgeous living” hoardings are long gone, as are the prices. No-nonsense signs on the Malahide Road now advertise houses in Belmayne starting from €245,000. Belmayne is just one attraction in north Dublin’s property market Ground Zero. In 10 minutes you can drive from the evacua

ESRI has been getting its forecasts wrong for years... In Irish economic circles, you tend to take much more stick from having been right than having been wrong. Those economists who got it wrong in the boom and believed the hype about the soft landing, such as the ESRI, still manage to grab front-page headlines. In contrast, those who called it right are put under constant scrutiny and are still being dismissed by the establishment as cranks, celebrities or, at best, lucky opportunists. The "insiders" rally round each other even when they are wrong and the "outsiders" are denigrated. In the economics world, for what it's worth, the outsiders' crime -- the crime of being right -- is particularly dangerous precisely because it exposes the limitations of the insiders. This type of insider/outsider prototype is commonplace in Ireland. Yesterday, we saw more of this type of behaviour where the establishment insiders carry on with their forecasts despite th

Mortgage forgiveness 'would cost €6bn'... A debt forgiveness scheme to relieve homeowners in mortgage distress would cost “in the region of €5-€6 billion”, UCD professor of economics Morgan Kelly has said. In a keynote address to the Irish Society of New Economists in Dublin yesterday, Prof Kelly delivered what he described as some “good news”. “We are talking sums in the region of €5 billion to €6 billion which would be necessary to spend on mortgage forgiveness, which by our standards are not very large,” he said. “This sum to sort out tens of thousands of people with big problems does not seem enormous.” Prof Kelly, who has been praised for forecasting the property crash, has also provoked sharp criticism from some commentators for his analysis of the recession. “The good news is that if you leave investment mortgages out [of total mortgages owed], which are largely the banks’ problem, and look at mortgages people have on their own houses, there are about €55 bil

EU loan is no bailout, it's financial bullying. Should we be taking our case on the EC's extortionate profit margin to the Court of Justice... SOME members of the European Council are exploiting our crisis in order to profit at our expense. If the interest rates on the EU loans are not reduced, the Irish public will suffer unnecessarily while our European partners profit from these loans. Last January, the European Financial Stabilisation Mechanism charged Ireland an interest rate of 5.51 per cent for money that it borrowed at 2.59 per cent. A month later, the European Financial Stabilisation Fund charged Ireland an interest rate of 5.9 per cent for money that it borrowed at 2.89 per cent. On this basis, the EFSF earns a profit margin of 3.01 per cent and the EFSM earns a profit margin of 2.93 per cent. These margins are draconian. The majority of the interest that Ireland pays is not used to pay for the EU's borrowing costs. It is excessive profit for the countries

Market hasn't hit bottom despite 40pc drop in four years, say economists... HOUSE prices are likely to continue to fall for another two years, analysts predicted yesterday. It came as a new, official index of residential property prices from the Central Statistics Office showed a 12pc fall in the past year. It also found that the pace of decrease has picked up in the past two months Prices are down 40pc from their peak level in 2007. Dublin has suffered much higher losses in value, with the crash cutting prices almost in half. In the rest of the country they are down by a third. The fall of 47pc in the capital contrasts with a plunge of 35pc elsewhere. Sharp drops in prices were recorded in February and March. The fall of 1.7pc in each month was the highest since July 2009. However, these decreases mainly reflect sales agreed last November when the €85bn IMF/EU bailout was agreed. The fact that the country was being bailed out meant that the only property transacti

I’VE OFTEN referred, half in jest, whole in earnest, to the likelihood that the blame game would get underway and that everyone would start suing everyone else until eventually, the Irish State would have to accept responsibility for the bank crash. And, it looks as if that might happen if the Irish Property Council (IPC) gets its way, as last week it announced its intention to take the Irish State to court. The IPC is an organisation, which represents a broad range of people in the property business, including builders, developers and investors. (And, before you go into hysterics; this organisation represents everyone from the small guy with one little investment property, to the much-hated big-time developers who once owned vast property portfolios.) The IPC’s main bone of contention is that borrowers are the only ones being held responsible for the Irish property crash. Bankers, the financial regulator and the government appear to have got away scot-free, despite the fact that t

'Bang twins' may never get to run a business again... POST-boom Ireland is awash with cautionary tales of Celtic Tiger excesses, as a rattle around the carcasses of fallen property developers and entrepreneurs will show. Few can compete with the so-called Bang twins for youth, glamour and tasteful extravagance. Simon and Christian Stokes, the 35-year-old identical twins behind Bang Cafe and exclusive private members club, Residence, saw their entire business go bust with debts of €9m, €3m of which is owed to the tax man. The debt may be in the ha'penny place compared with the eye-watering billions owed by some of their former customers. But their fall has been arguably steeper and more damning than some of the country's richest tycoons. Last week, further humiliation was heaped on them with revelations that even as their businesses were going under, the twins spent €146,000 of company money in 18 months on designer shopping sprees, five star holidays and sumptu

I’M WAITING for the implosion. I feel it in my gut and over many years I’ve learnt to trust gut instinct. Something just doesn’t add up. Why are so few houses on the market these days? You might be fooled into believing there is a glut of properties for sale, until you actually go out to look, whereupon you soon realise the turnover of property is so slow that you are looking at the same selection each week. Indeed, so few houses are coming on the market, particularly at the upper end, that the few potential buyers out there are now frustrated, as the choice is so limited. Why are people not selling? It makes no logical sense given what we now know about the vast numbers of mortgages in arrears. Estate agents say that homeowners at the middle to upper level are not selling because property has lost so much value of late they would prefer to hang on until the market improves. Which is all very logical and reasonable assuming these owners can hang on – but are we talking about

Thousands of horses and ponies abandoned in Irish countryside as financial crisis bites... Tens of thousands of horses and ponies are believed to have been abandoned in the Irish countryside as families struggle to cope with the financial meltdown. Animal welfare inspectors have had to shoot some of the worst affected animals left badly weakened by exposure, starvation, sickness and injury. With costs of feeding or keeping the horses in stables running to £26 per day, generations who have kept horses as a passion have no longer been able to afford to keep them. Irish Prime Minister Brian Cowen has pledged £12.8billion in spending cuts and tax increases over the next four years. The austerity measures are expected to lead to a 10 per cent cut in the disposable income of Ireland's middle class, and worse for those on lower incomes, leaving them without the funds to care for domestic pets. Irish law requires owners to have animals registered and microchipped, but it is not rigidly enf

THE most comprehensive report on the Irish property market is out and it evidences the total destruction of wealth of a certain generation. According to the wonderfully detailed work done by Ronan Lyons at Daft.ie, asking prices countrywide fell by just over 4pc in the second three months of the year -- a slightly larger fall than in the first quarter. The average asking price nationally in the second quarter of 2010 was just over €224,000 -- 36pc below its 2007 peak. The acceleration in price falls will come as little surprise, but the question now is how can a generation whose balance sheet has been so totally vaporised ever start spending again? Back in 2007, I wrote a book called 'The Generation Game', which focused on how the generation between the ages of 30 and 40, who had got into the housing market via huge mortgages, would be financially eviscerated. This group was termed "the juggling generation" because they were trying to juggle being good parents and go

The Republic's budget targets remain on track despite the country being €10bn in the red, the Government said last night. Latest exchequer figures show €17.2bn taxes were collected in the first seven months of the year - 1.4% or €247m below target. Separate figures revealed the Irish economy shrunk 7.6% last year. Fine Gael claimed the country had suffered the longest and deepest recession of any advanced economy in the world. Richard Bruton, enterprise spokesman, said the rate of economic decline was five times worse than the average fall suffered by advanced countries. "Despite all the evidence and the conclusions of the recent banking reports, some Government ministers continue to pretend that Ireland's problems were caused by outside forces, when the truth is that Ireland and its people have been the victims of catastrophic economic mismanagement," Mr Bruton said. The exchequer deficit at the end of July was €10.2bn, down from the €16.4bn recorded at the same per

Ireland is staring down the barrel of bankruptcy... Why are interest rates for Irish debt rising? Because the risk of a blowout here is rising -- it really is that simple IN THE summer of 1787, determined to show foreign ambassadors the might of Russian power in the newly subjugated Ukraine, Catherine the Great organised a boat trip down the Dnieper, past modern-day Kiev. Her trusted field marshal -- who was also her lover -- Prince Gregory Potemkin organised a series of mobile villages to appear as soon as the imperial barge, stuffed with innocent and gullible foreign dignitaries, came into view. When the boat came within earshot of the river bank, the villagers would break into a spontaneous, sycophantic chorus of praise for the empress, giving the perplexed foreigners the impression that not only had Russia pacified Ukraine, it had also managed to win over the local peasantry -- which was no mean feat in the 18th Century. As soon as the imperial barge turned the corner, the villager

How Cowen took a €440bn shot in dark... Government snub for own advisers: THE Government was in the dark about the true scale of the banks’ massive losses when it ignored its own advisers and pushed ahead with a €440bn blanket state guarantee. Losses at the banks have ended up being double the amount the Department of Finance assumed at the time of the bailout. The €440bn bailout was undertaken on the basis that the banks had assets of €500bn. But in reality these assets were worth far less because of the property crash. If the guarantee was called in at any time, taxpayers would face colossal losses that would dwarf the banking bill to date. The startling revelations are revealed in newly released documents from a Dail committee investigating the banking crisis. The documents revealed: ● Contingency plans to nationalise Anglo Irish Bank and Irish Nationwide were in place before the controversial guarantee was agreed on September 29. ● A special lending scheme proposed by advisers Merr

Nama turns us into a nation of speculators... OPINION: Builders and developers have finally managed to shape the country in their own image... THE DRAFT National Asset Management Agency (Nama) legislation runs to 136 pages, so it’s not too surprising that most people have missed the interesting section 201. It reads as follows: 201.1: Henceforth, all male children shall be called Seán, Seánie, Paddy, Mick, Tom, Joe, Gerry, Liam or Bernard. All female children shall be christened Seona, Patricia, Michaela, Tomasina, Josephine, Geraldine, Wilma or Bernadine and shall be referred to de facto as Seán, Seánie, Paddy, Mick, Tom, Joe, Gerry, Liam or Bernard. 201.2: From the coming into force of this legislation, all citizens shall be required to receive a daily dosage of testosterone and cocaine to induce feelings of competitive aggression and megalomaniacal omnipotence. 201.3: All male citizens shall wear a pink shirt as a declaration that said citizen is so macho that he can wear pink and n