NAMA negative equity scheme

Newaglish

Has anyone seen the details of this?

http://www.thejournal.ie/nama-pilot-mortgage-programme-to-insulate-buyers-from-negative-equity-443639-May2012/

NAMA HAS TODAY unveiled a pilot programme aimed at encouraging first-time buyers to enter the housing market by insulating them from the possibility of negative equity by up to 20 per cent.

Under the scheme, potential buyers will be asked to pay 80 per cent of the value of the home up front, including at least 10 per cent provided by means of the purchaser’s own deposit.

The remaining 20 per cent will then be due in five years’ time, but will be discounted depending on if the value of the property falls in the meantime.

Seems like an interesting idea although I have to look at it in detail. Instinctively I would imagine the distorting impact of this scheme could end up being reflected in the sale price to begin with.

Zamboni

The properties available on the scheme in Dublin are not remotely appealing.
Don't know about Cork.

Development Units
Delvin Banks, Naul Village, Co Dublin
Loughmore Square, Killeens Castle, Dunshaughlin, Co Meath
Browns Barn Wood, Dublin 22
Carrickmines Manor, Glenamuck Road Dublin 18
Cul Ard, Carrigtwohill, Co Cork
Old Quarter, Ballincollig, Cork
Drakes Point, Crosshaven, Co Cork
Brightwater, Crosshaven, Co Cork
Rowan Hill, Mount Oval, Rochestown, Cork
Inis Alainn, Carrignafoy, Cobh, Co Cork
Highfield Park Development, Ballincollig, Co Cork
Ardfield, Grange, Douglas, Co Cork

Zamboni

Interesting rate from PTSB

Permanent TSB confirms role

Permanent TSB confirmed that it will be taking part in the scheme, offering a variable rate of 3.69%. The bank says that it has constructed the product to ensure that even if prices don't fall after five years, the customer will not face increased repayments at that time.

The bank has set up a dedicated hotline for queries related to the initiative - 1890 500 143.

http://www.rte.ie/news/2012/0508/nama-launches-pilot-scheme-to-protect-homebuyers.html

Dannyboy1987

Zamboni wrote: »

The properties available on the scheme in Dublin are not remotely appealing.
Don't know about Cork.

Development Units
Delvin Banks, Naul Village, Co Dublin
Loughmore Square, Killeens Castle, Dunshaughlin, Co Meath
Browns Barn Wood, Dublin 22
Carrickmines Manor, Glenamuck Road Dublin 18
Cul Ard, Carrigtwohill, Co Cork
Old Quarter, Ballincollig, Cork
Drakes Point, Crosshaven, Co Cork
Brightwater, Crosshaven, Co Cork
Rowan Hill, Mount Oval, Rochestown, Cork
Inis Alainn, Carrignafoy, Cobh, Co Cork
Highfield Park Development, Ballincollig, Co Cork
Ardfield, Grange, Douglas, Co Cork

Must be for first time buyers with a lot of money

seamus

Dannyboy1987 wrote: »

Must be for first time buyers with a lot of money

It would vary.

An FTB would probably go for a two or three-bed, which in most of these places you're looking at a max. of €200k. Which basically means that the buyer needs €20k deposit and €140k mortgage.

€20k deposit isn't huge if you've been saving for five or six years, especially if you've been living in the family home.

I think the status of FTBs is somewhat unknown at the moment. People who came out of college in 2007 are now five years into their careers, probably on reasonable money (€30k+) and have seen lower rents than anyone else in the last 20 years. And practically none of them have bought anything.

The proportion of 20-somethings who bother saving money though is another question. I knew very few people who bothered saving much money when they left college.

Idbatterim

The properties available on the scheme in Dublin are not remotely appealing.

Carrickmines manor isnt bad on the luas line and M50, only a few minutes from dundrum and sandyford industrial estate by car with no traffic...

ionapaul

It's also only a short walk from Ballyogan Wood, a pretty rough council estate - that Luas stop is always fun when going home, wondering what the wild youngsters who get on there will get up to on the way into town! Personally, I'd give Carrickmines Manor a miss, wait for Nama to release some nicer properties further up the line or in Sandyford itself...

washman3

Its a scam.! plain and simple. hope people can see through it for what it is. The houses in question are overvalued now by at least 30%.
Forget about this "5 years time" nonsense.
Have any lessons been learned.?? :mad:

indiewindy

Why doesnt nama simply put its a lot stock on the open market rather than continue to try to manipulate the market. They have been sitting on thousands of properties for 2 years now.

alb

How are they going to know if you're in negative equity unless you try to sell? No one knows exactly what their property is worth until someone else buys it from them.

gurramok

Crazy prices! Aimed at the upper end of the FTB market(if they bother looking)
http://www.irishtimes.com/newspaper/breaking/2012/0508/breaking42.html

Irish Times wrote:

Mr McDonagh said the pilot scheme was targeted at a potential shortage of family homes at an average price of €300,000 and that no apartments were being offered initially.

There are 62 houses in Co Cork eligible for the initiative in the pilot scheme and 53 in Dublin and Meath. All the properties are on estates where the majority of the houses have already been sold.

Among the properties are two houses remaining in the Browns Barn Wood development on the Naas Road in Dublin which are priced from €335,000. There are 18 houses for sale in a development on the Killeen Castle estate near Dunshaughlin in Co Meath which are priced from €270,000 to €410,000.

There are a further 29 properties in the Devlin Banks development in Naul, Co Dublin priced from €175,000.

washman3

seamus wrote: »

The proportion of 20-somethings who bother saving money though is another question. I knew very few people who bothered saving much money when they left college.

To be honest seamus,a huge number of 20-somethings are now in Australia,Canada,UK and USA. And being joined daily by more and more of the same.

Zamboni

Good man Brendan.

Chief executive of Nama Brendan McDonagh said the State agency would not haggle with buyers as the 115 houses were already priced at a “fair value”.

http://news.ie.msn.com/nama-houses-in-80percent-price-drop

who_ru

Proper scam innit.

Snakeblood

Zamboni wrote: »

Good man Brendan.



http://news.ie.msn.com/nama-houses-in-80percent-price-drop

If they're fair value with a 20% price drop guarantee, I'm surprised he's not snapping them up himself up. Safe as houses, they seem.

jmayo

Zamboni wrote: »

The properties available on the scheme in Dublin are not remotely appealing.
Don't know about Cork.

Cork has never appealed to me.
It's full of Cork people.

colmdel

Definate scam! I had a look at the houses on offer in the Old Quarter in Ballincollig. They are builders finish some still need driveways etc and way overpriced! They are worth around 100 to 110k in todays market not 130k they wont even entertain lower offers. Full price only!! Thats why they are still sitting there nobody will touch them! Especially when there are 3 bed semi-d's with garages for sale for 150k in other estates like Muskerry and Rosewood. Rant over.:D

Balarrr Didiarr

http://touch.boards.ie/thread/2055750736?page=1

Is this the same place as listed by NAMA? I've read a few articles on the build of Carrickmines Manor. Thread above mentions roof appeared to be made with MDF/Plywood. Is it same complex?

cork_south

According to the register, 3 bed semis are being sold in Cul Ard for around €155K on this scheme which seems like pretty good value seeing as there are people living in the exact same houses who paid €330K for the same house at the peak of the boom :eek:
Carrigtwohill is one of the closest commuter towns to the city, its only about 8 minutes from the Jack Lynch tunnel via the dual carraigway.
Prices below are EX 13.5% VAT
18/04/2012 €136,563.88 9 An Mullach, Cul Ard, Carrigtwohill, Cork
07/06/2012 €135,242.29 34 An Faill, Cul Ard, Carrigtwohill, Cork
06/09/2012 €135,242.29 38 An Faill, Cul Ard, Carrigtwohill, Cork
02/11/2012 €121,100.00 33 an Faill, Cul Ard, Carrigtwohill, Cork
05/11/2012 €130,484.00 35 An Faill, Cul Ard, Carrigtwohill, Cork
28/11/2012 €140,000.00 32 An Faill, Cul Ard, Carrigtwohill, Cork

http://www.mosgroup.ie/homes/residential/cul-ard/house-types/type-a/

jmayo

cork_south wrote: »

According to the register, 3 bed semis are being sold in Cul Ard for around €155K on this scheme which seems like pretty good value seeing as there are people living in the exact same houses who paid €330K for the same house at the peak of the boom :eek:

STOP, STOP, STOP right there.

Stop comparing the current price to what it was during the peak of the bubble/boom as a measure of value.
It is a false view of "good value" or "a bargain".
Everything looks good value when compared to what it was in 2006.

seamus

jmayo wrote: »

STOP, STOP, STOP right there.

Stop comparing the current price to what it was during the peak of the bubble/boom as a measure of value.
It is a false view of "good value" or "a bargain".
Everything looks good value when compared to what it was in 2006.

Indeed. Rough guide: Take the 2006 price, cut it by 55%. Now you have the "normal" value of the property, which can be used to determine if the price is good value.

In this case, 45% of €330k is ~€149k. So a price of €155k is a little over market value, and not good value at all.

cork_south

seamus wrote: »

So a price of €155k is a little over market value, and not good value at all.

Tell that to the people living next door who have 330K mortgages.

Also, the market value is what people are willing to pay and the market value of these houses are written in black and white in the Register.

jmayo

cork_south wrote: »

Tell that to the people living next door who have 330K mortgages.

Also, the market value is what people are willing to pay and the market value of these houses are written in black and white in the Register.

Ehh that market value has changed even since those entries went on the price register as the market is still a falling one.
The increase in late 2012 was a false one due to FTBs being coerced back into the market.
Watch the falls this spring.

BTW who cares what the people next door have, worry about yourself and what you have or will have.

cork_south

jmayo wrote: »

STOP, STOP, STOP right there.
Everything looks good value when compared to what it was in 2006.

Thx for the headsup, I really hadn't noticed.
The fact is some people are never happy and I think the reaction to the 80\20 scheme in this thread shows that.

I agree prices will fall further. However, people who have bought in 2012 have their MIR sorted and are protected against a further 20% drop in the selling price.

Good luck to them, I know I'd rather be in their shoes than their neighbours who are servicing mortgages over twice their size and have no 20% to fall back on.

who_ru

cork_south wrote: »

Thx for the headsup, I really hadn't noticed.
The fact is some people are never happy and I think the reaction to the 80\20 scheme in this thread shows that.

I agree prices will fall further. However, people who have bought in 2012 have their MIR sorted and are protected against a further 20% drop in the selling price.

Good luck to them, I know I'd rather be in their shoes than their neighbours who are servicing mortgages over twice their size and have no 20% to fall back on.

how are they protected against a further 20% drop in the selling price?

cork_south

who_ru wrote: »

how are they protected against a further 20% drop in the selling price?

I'm not sure if you are taking the piss but ill give you the benefit of the doubt :-)
Read the opening post or google Nama 80:20.
The buyer is protected against a drop of 20% 5 years after the purchase date.

who_ru

cork_south wrote: »

I'm not sure if you are taking the piss but ill give you the benefit of the doubt :-)
Read the opening post or google Nama 80:20.
The buyer is protected against a drop of 20% 5 years after the purchase date.

ok thanks, mortgage repayments will be on the full amount of course, nothing about what will happen if value of house falls more that 20%, plus if you want to sell within first 5 years of the mortgage you need written consent from NAMA.

it looks like NAMA will not come clean on how many homes it has sold under it's scheme but it certainly doesn't seem like it's a great success - one thing is certain about NAMA - you will never really know the truth about their dealings. it does seem that this 80:20 is about flushing out a few more FTB's as we saw with the ending of the MIR package.

http://namawinelake.wordpress.com/2012/10/06/is-nama-pulling-our-leg-about-the-success-of-its-deferred-mortgage-scheme/