2021 Irish Property Market chat - *mod warnings post 1*

awec

cnocbui wrote: »

No house viewings, no school for your kids, but that all important NCT check of your car is still open for business. Absolutely unbelievable.

I can only imagine the company with the contract has threatened legal action and the government has caved.

The conspiracy theories on here are wild sometimes.

cnocbui

Digiteer wrote: »

Don’t think so, there are literally thousands of vacant properties particularly in Dublin.!! This government has manufactured homelessness & overpriced homes to facilitate the market, nothing more. The only thing keeping everything going is Immigration, when that stops so will the economy.!!

How do you know they are habitable?

hometruths

awec wrote: »

Bray will eventually be consumed into south Dublin.

Agreed, but will it be a desirable part of south Dublin? I think so.

hometruths

cnocbui wrote: »

How do you know they are habitable?

Because this has been checked by the CSO.

cnocbui

awec wrote: »

The conspiracy theories on here are wild sometimes.

Fair enough, but if the pandemic is serious enough to cancel schooling for children, why is it not serious enough to cancel an unnecessary frippery like the NCT, which was closed for the first lockdown?

I'd say house viewings and people's accomodation needs were fundamental and far more important.

cnocbui

schmittel wrote: »

Because this has been checked by the CSO.

How did they check? They know the plumbing is in good order, there is heating that works?

I own an unoccupied building not in Dublin and there is no f'n way in hell the CSO would have a clue about it or what state it is in.

awec

cnocbui wrote: »

Fair enough, but if the pandemic is serious enough to cancel schooling for children, why is it not serious enough to cancel an unnecessary frippery like the NCT, which was closed for the first lockdown?

I'd say house viewings and people's accomodation needs were fundamental and far more important.

NCT was open for much of the first lockdown.

Things like car servicing etc were always deemed essential.

cnocbui

awec wrote: »

NCT was open for much of the first lockdown.

Things like car servicing etc were always deemed essential.

My NCT due June wasn't bookable and was extended by four months. Car servicing is essential, as is accommodation, but the NCT isn't.

Villa05

PropQueries wrote:

"AIB sells portfolio of private home loans to Mars Capital for €400m"

It is puzzling that one arm of the state is paying top rates for housing for social affordable while a bank 83% controlled by the state is selling at greater than 50% discount (excluding arrears)

I know it will not increase stock but neither will hap, or buying existing units from developers

It appears the government don't want to loose that status of the country that keeps on giving to private business

Zenify wrote:

It's just policy after policy to stimulate demand. I get the logic of higher prices equals more building but we can encourage it in others ways. Make it more expensive to hold onto residential land. It's about carrot and STICK. We need far more stick!

It's a bit carrot, cake, icing, and cherry on top

hometruths

PropQueries wrote: »

Good time for AIB to release this information given that Ulster Bank will be all over the news this weekend. 92% of the 4,000 loans in the portfolio sale are private dwelling homes. According to the Irish Times:

"AIB sells portfolio of private home loans to Mars Capital for €400m"

"AIB said the portfolio consists of 4,000 non-performing loans, with an average time since first default of 10 years, while 90 per cent of the portfolio first entered default over seven years ago.

Some 92 per cent of the portfolio is made up of private dwelling homes, while 5 per cent are buy-to-let properties and 3 per cent are mixed use property. The average balance per customer is €300,000, with an average arrears amount of €95,000."

Link to Irish Times article here: https://www.irishtimes.com/business/financial-services/aib-sells-portfolio-of-private-home-loans-to-mars-capital-for-400m-1.4489433

This right here is everything that is f*cked up about our property market.

4,000 loans with an average balance of 300,000 means total loan book is valued at 1.2bn outstanding.

Mars Capital have bought this for a third of its value, meaning AIB and the taxpayer have booked a 66% or 800m loss and Mars will make a fortune.

There is nowhere in the country that a 300k property bought even at the height of the boom is worth only 100k. So even if every single mortgage was a 100% bought at top of market, AIB and the taxpayer would have got a better deal by repoing and selling the asset.

To add insult to injury they feel the need to bury the bad news not because they're making a poor decision, but because they're worried about vulture fund criticism.

The average time of default is 10 years. 90% of the portfolio entered default over 7 years ago.

The raft of unintended consequences as a result of our naive no repossessions policy is the single biggest factor causing the current housing problems.

This would not happen in any other country, whereas we happily support it. It is mind blowing.

No wonder the vulture funds think we're the gift that keeps on giving.

hometruths

cnocbui wrote: »

How did they check? They know the plumbing is in good order, there is heating that works?

I own an unoccupied building not in Dublin and there is no f'n way in hell the CSO would have a clue about it or what state it is in.

We've been through this before. They check pretty thoroughly. They don't get every single right, but it is reasonable to believe they get the majority right.

PropQueries

schmittel wrote: »

This right here is everything that is f*cked up about our property market.

4,000 loans with an average balance of 300,000 means total loan book is valued at 1.2bn outstanding.

Mars Capital have bought this for a third of its value, meaning AIB and the taxpayer have booked a 66% or 800m loss and Mars will make a fortune.

There is nowhere in the country that a 300k property bought even at the height of the boom is worth only 100k. So even if every single mortgage was a 100% bought at top of market, AIB and the taxpayer would have got a better deal by repoing and selling the asset.

To add insult to injury they feel the need to bury the bad news not because they're making a poor decision, but because they're worried about vulture fund criticism.

The average time of default is 10 years. 90% of the portfolio entered default over 7 years ago.

The raft of unintended consequences as a result of our naive no repossessions policy is the single biggest factor causing the current housing problems.

This would not happen in any other country, whereas we happily support it. It is mind blowing.

No wonder the vulture funds think we're the gift that keeps on giving.

If you think Mars Capital is getting such a great deal, just imagine today's value of the underlying assets attached to the c. €200 billion in loans these funds purchased from Irish banks, NAMA etc. between 2012 and 2016.

If/when they decide to leave, they purchased them so cheaply that they can most likely sell many of the underlying assets at c. 25% of today's prices and still walk away with double their initial investment IMO

Only question I don't know is how much property they control (A lot more than people think IMO) and when will they decide to leave.

hometruths

PropQueries wrote: »

If you think Mars Capital is getting such a great deal, just imagine today's value of the underlying assets attached to the c. €200 billion in loans these funds purchased from Irish banks, NAMA etc. between 2012 and 2016.

If/when they decide to leave, they purchased them so cheaply that they can most likely sell many of the underlying assets at c. 25% of today's prices and still walk away with double their initial investment IMO

Only question I don't know is how much property they control (A lot more than people think IMO) and when will they decide to leave.

What concerns me is not that they're making money hand over fist. It is that nobody seems to understand the folly of this no repo, sell the loan book approach.

The fact that the vulture funds are coining it in is because of our collective stupidity. You can hardly blame them for looking a gift horse in the mouth.

I'd rather fix our understanding of the problem at hand, which would be a better result for the taxpayer/renter/buyer/homeless/government all round.

PropQueries

schmittel wrote: »

What concerns me is not that they're making money hand over fist. It is that nobody seems to understand the folly of this no repo, sell the loan book approach.

The fact that the vulture funds are coining it in is because of our collective stupidity. You can hardly blame them for looking a gift horse in the mouth.

I'd rather fix our understanding of the problem at hand, which would be a better result for the taxpayer/renter/buyer/homeless/government all round.

I get that point. But it's not like we're the UK or the USA where both the borrower and lender know in advance what happens in the event of default.

If they change the laws now, the only beneficiaries are the funds who now control most of these distressed mortgages, loans etc.

If the laws are changed and the repossession process made more quicker and efficient, the funds will leave faster than they initially intended and break the property market completely on their way out through their repossession sales IMO.

Just imagine if Mars Capital could initiate repossession proceedings like the UK or USA and get these people out in e.g. 6 months time? There would be an additional c. 4,000 homes for sale in 6 months time from this one deal alone.

Having said that, if a FTB is waiting to buy and the repossession laws were changed to be like the UK or USA, they would definitely be able to buy a house in any area in Ireland for c. 25% of current market value in the next 12 months if the rules around repossessions were changed tomorrow IMO

It's a tough one though. These legacy issues are literally destroying the country and will continue to do so for the foreseeable future

Villa05

schmittel wrote:

This would not happen in any other country, whereas we happily support it. It is mind blowing.

schmittel wrote:

No wonder the vulture funds think we're the gift that keeps on giving.

Point 1, this is not something that started today. It's been going on for a decade

2 They continue to pay no tax on their profits

3 the degree of default on the loans would suggest that the occupants would have very low income so its highly likely that the state will be subsidising rents for the new owner or entering long term leases guaranteeing peak rental income tax free for new owners.


There is no other way to dress this up. It is outright legalised robbery.
It would work out cheaper for the state to write off the debt for the original lender

Governments housing policy is multiple children's hospital fiascos in terms of cost.

They will bankrupt us

Hubertj

I’m going to call up some of the banks to see if there are any distressed loans going. Looks like money to be made. I have to go to the bank now anyway so will ask at the counter.

cnocbui

Hubertj wrote: »

I’m going to call up some of the banks to see if there are any distressed loans going. Looks like money to be made. I have to go to the bank now anyway so will ask at the counter.

I just want to get on a plane and get a long way away from this madhouse - permanently.

Cyrus

PropQueries wrote: »

If you think Mars Capital is getting such a great deal, just imagine today's value of the underlying assets attached to the c. €200 billion in loans these funds purchased from Irish banks, NAMA etc. between 2012 and 2016.

If/when they decide to leave, they purchased them so cheaply that they can most likely sell many of the underlying assets at c. 25% of today's prices and still walk away with double their initial investment IMO

Only question I don't know is how much property they control (A lot more than people think IMO) and when will they decide to leave.

They purchased the loans not the assets and we have already established if they are private dwellings getting their hands on the assets is nigh on impossible

Villa05

Hubertj wrote:

I’m going to call up some of the banks to see if there are any distressed loans going. Looks like money to be made. I have to go to the bank now anyway so will ask at the counter.

A family member had a couple house purchases for ppr fall through because banks were bundling up the mortgages for portfolio sale.

When I was buying my ppr one of the options I was looking at was being "reserved for preferred customer". It had obvious investment potential

PropQueries

Cyrus wrote: »

They purchased the loans not the assets and we have already established if they are private dwellings getting their hands on the assets is nigh on impossible

Excellent point. The home owners of those loans that Mars Capital have just purchased have nothing at all to worry about (said in jest of course)

Truth is, whoever controls your loan controls you and they definitely control any assets used as security for that loan.

It applies to companies, it applies to sovereign states and it really really really applies to individuals.

hometruths

Villa05 wrote: »

Point 1, this is not something that started today. It's been going on for a decade

Therein lies the problem. It was a stupid idea ten years ago, even more so today.

Villa05 wrote: »

2 They continue to pay no tax on their profits

Assuming they are obeying the tax laws I don't have a problem with this. Yes I'd agree the law should not be so favourable, but it does not anger me as much as the fact that they were sold the loans in the first place.

Villa05 wrote: »

3 the degree of default on the loans would suggest that the occupants would have very low income so its highly likely that the state will be subsidising rents for the new owner or entering long term leases guaranteeing peak rental income tax free for new owners.

This is nonsense for a whole raft of reasons but principally the degree of default on mortgage loans in Ireland shows some very odd characteristics - eg we're the only country in the world that mortgage defaults rose even as unemployment rates fell. Look at the spike in the mortgage default rate around the time of the Dunne ruling. This is one area where Ireland really is different. We have a strategic default problem.

The idea that repossessing 4,000 houses = occupants of those 4,000 houses automatically being added to the housing list is ridiculous.

Villa05 wrote: »

There is no other way to dress this up. It is outright legalised robbery.
It would work out cheaper for the state to write off the debt for the original lender

Governments housing policy is multiple children's hospital fiascos in terms of cost.

They will bankrupt us

If by robbery you mean the vulture funds are robbing us that's another myth. We're giving it away, and the funds would be fools not to take advantage.

We have to stop giving it away rather than complaining about being robbed.

Villa05

Cyrus wrote:

They purchased the loans not the assets and we have already established if they are private dwellings getting their hands on the assets is nigh on impossible

The original owner will eventually die, if they can't afford the mortgage, that's fine, the State will pay full market rent which will be greater than the mortgage repayments

We have essentially sold them a goldmine with the state doing the mining for them and they can leave without paying any tax

Hubertj

Villa05 wrote: »

The original owner will eventually die, if they can't afford the mortgage, that's fine, the State will pay full market rent which will be greater than the mortgage repayments

We have essentially sold them a goldmine with the state doing the mining for them and they can leave without paying any tax

What’s that saying about death and taxes? Oh wait....

Hubertj

Villa05 wrote: »

The original owner will eventually die, if they can't afford the mortgage, that's fine, the State will pay full market rent which will be greater than the mortgage repayments

We have essentially sold them a goldmine with the state doing the mining for them and they can leave without paying any tax

What’s that saying about death and taxes? Oh wait....

Villa05

schmittel wrote:

Assuming they are obeying the tax laws I don't have a problem with this. Yes I'd agree the law should not be so favourable, but it does not anger me as much as the fact that they were sold the loans in the first place.

schmittel wrote:

This is nonsense for a whole raft of reasons but principally the degree of default on mortgage loans in Ireland shows some very odd characteristics - eg we're the only country in the world that mortgage defaults rose even as unemployment rates fell. Look at the spike in the mortgage default rate around the time of the Dunne ruling. This is one area where Ireland really is different. We have a strategic default problem.

Legalised robbery is the tern I used perpetrated on the taxpayer. Sorry my post looked a bit agressive, it was meant to enhance your point rather than attack it

There is a element of strategic default but there are also areas where people lost their jobs and struggled to get new employment
Eg
Dell workers would struggle to get employment in the many industries that replaced Dell. Many did get work but many did not

I'm sure there are other examples

awec

awec wrote: »

Bray will eventually be consumed into south Dublin.

Bray is already in South Dublin. The county boundary is along old connaught ave for some of it, plenty of estates in Bray are in Co. Dublin.

MacronvFrugals

Piece on IRES in today's IT - cough cough trickling supply...

State’s biggest landlord increased revenue by 20% last year

Ires Reit says average monthly rent was €1,624 per unit, up from €1,596 the year before

“Being cognisant of the challenges faced by many arising from the onset of the Covid-19 pandemic, the group has not implemented any rent increases on renewals since April 1st,” chief executive Margaret Sweeney said.

The group had a portfolio of 3,688 residential units across 34 properties in the Dublin region and one property in Cork as of December 31st.

She said the Dublin and Irish market continued to attract “significant investor demand” during 2020 despite the impact of Covid-19 and related restrictions.

Looking forward, Ms Sweeney said social and economic uncertainty is likely to continue due to Covid-19, but that “ongoing supply constraints and resilient demand drivers for housing will underpin the performance of the group for the remainder of the financial year”

https://www.irishtimes.com/business/commercial-property/state-s-biggest-landlord-increased-revenue-by-20-last-year-1.4489413?mode=sample&auth-failed=1&pw-origin=https%3A%2F%2Fwww.irishtimes.com%2Fbusiness%2Fcommercial-property%2Fstate-s-biggest-landlord-increased-revenue-by-20-last-year-1.4489413

Hubertj

Ha repossession always been difficult in Ireland? Or did it only become an issue following 2008?

Gael23

Hubertj wrote: »

Ha repossession always been difficult in Ireland? Or did it only become an issue following 2008?

There’s protection for the family home so it has become even more difficult. Perhaps to protect children from homelessness more so

hometruths

Hubertj wrote: »

Ha repossession always been difficult in Ireland? Or did it only become an issue following 2008?

Wasn't a widescale problem pre 2008 as most people paid their mortgages, and those who were unable to did not think it unreasonable that they might have to give up the house.

That's been turned upside down since 2008.