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The irony of ireland`s homelessness crisis

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  • 13-01-2017 12:35pm
    #1
    realitykeeper
    Registered Users Posts: 4,138 ✭✭✭


    Had the government let the banks fail, and facilitated the easy repossession of properties in default, it would have led to property prices plummeting to the point where people could afford to buy them outright or to get a mortgage for them or to rent them cheaply.

    Furthermore it would have enabled new developers (who had not over borrowed) to start building new housing in a normal functioning housing market.

    What we are seeing now is just the beginning of the pain the country postponed by bailing out the banks. The people who over borrowed in the naughties got to keep the properties they borrowed for and the bailout bill was handed to the students and young people had not borrowed for a mortgage before 2007.

    The rent increases also helped those who borrowed in the naughties to keep their second and third homes to the detriment to the young people who were completely blameless.

    Had the banks not been bailed out, some of those homeless people in Apollo House could be property owners now.


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    #2
    Kristopherus
    Registered Users Posts: 11,907 ✭✭✭✭Kristopherus


    How could anyone borrow if the banks were gone ?????


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    #3
    realitykeeper
    Registered Users Posts: 4,138 ✭✭✭realitykeeper


    Kristopherus wrote: »
    How could anyone borrow if the banks were gone ?????

    There were credit unions, the post office, foreign banks, new banks would have been licenced to fill the void quite quickly.

    Bailing out the banks was prone to corporate moral hazard, it was unprincipled and will ultimately cost the country dearly.


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    #4
    Timberrrrrrrr
    Registered Users Posts: 25,418 ✭✭✭✭Timberrrrrrrr


    realitykeeper wrote: »
    Had the government let the banks fail, and facilitated the easy repossession of properties in default, it would have led to property prices plummeting to the point where people could afford to buy them outright or to get a mortgage for them or to rent them cheaply.

    Furthermore it would have enabled new developers (who had not over borrowed) to start building new housing in a normal functioning housing market.

    What we are seeing now is just the beginning of the pain the country postponed by bailing out the banks. The people who over borrowed in the naughties got to keep the properties they borrowed for and the bailout bill was handed to the students and young people had not borrowed for a mortgage before 2007.

    The rent increases also helped those who borrowed in the naughties to keep their second and third homes to the detriment to the young people who were completely blameless.

    Had the banks not been bailed out, some of those homeless people in Apollo House could be property owners now.

    Are the people in Apollo house not homeless because they have lost their jobs and can't afford rent/mortgages?

    Are you saying the credit unions and "new banks" would have given unemployed people mortgages?


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    #5
    Rightwing
    Closed Accounts Posts: 8,101 ✭✭✭Rightwing


    realitykeeper wrote: »
    Had the government let the banks fail, and facilitated the easy repossession of properties in default, it would have led to property prices plummeting to the point where people could afford to buy them outright or to get a mortgage for them or to rent them cheaply.

    Furthermore it would have enabled new developers (who had not over borrowed) to start building new housing in a normal functioning housing market.

    What we are seeing now is just the beginning of the pain the country postponed by bailing out the banks. The people who over borrowed in the naughties got to keep the properties they borrowed for and the bailout bill was handed to the students and young people had not borrowed for a mortgage before 2007.

    The rent increases also helped those who borrowed in the naughties to keep their second and third homes to the detriment to the young people who were completely blameless.

    Had the banks not been bailed out, some of those homeless people in Apollo House could be property owners now.

    It wouldn't.

    Builders are finding it difficult to make a return on investment as it is. Government needs to greatly reduce levies so that builders can build affordable homes and still make a profit. The cost of a build remains the problem.
    There is truth in some of your other points. But who are these homeless Apollo house residents, have they jobs? Are they alcoholics/drug addicts? I find it hard to see how someone can become homeless unless they are more or less a complete loser with no prospects, and then such individuals wouldn't be in a position to get a house if it was selling for €10K.


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    #6
    pilly
    Banned (with Prison Access) Posts: 9,005 ✭✭✭pilly


    realitykeeper wrote: »
    Had the government let the banks fail, and facilitated the easy repossession of properties in default, it would have led to property prices plummeting to the point where people could afford to buy them outright or to get a mortgage for them or to rent them cheaply.

    Furthermore it would have enabled new developers (who had not over borrowed) to start building new housing in a normal functioning housing market.

    What we are seeing now is just the beginning of the pain the country postponed by bailing out the banks. The people who over borrowed in the naughties got to keep the properties they borrowed for and the bailout bill was handed to the students and young people had not borrowed for a mortgage before 2007.

    The rent increases also helped those who borrowed in the naughties to keep their second and third homes to the detriment to the young people who were completely blameless.

    Had the banks not been bailed out, some of those homeless people in Apollo House could be property owners now.

    Little bit of a naïve view imo, the people in Apollo house in the main need social housing, they would not be in a position to buy houses.


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    #7
    pilly
    Banned (with Prison Access) Posts: 9,005 ✭✭✭pilly


    Rightwing wrote: »
    It wouldn't.

    Builders are finding it difficult to make a return on investment as it is. Government needs to greatly reduce levies so that builders can build affordable homes and still make a profit. The cost of a build remains the problem.
    There is truth in some of your other points. But who are these homeless Apollo house residents, have they jobs? Are they alcoholics/drug addicts? I find it hard to see how someone can become homeless unless they are more or less a complete loser with no prospects, and then such individuals wouldn't be in a position to get a house if it was selling for €10K.

    <snip> obviously not at all educated about the various different reasons behind homelessness. Definitely not a case that all homeless people are complete losers without prospects. :mad:


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    #8
    oscarBravo
    Technology & Internet Moderators Posts: 28,792 Mod ✭✭✭✭oscarBravo


    Rightwing wrote: »
    I find it hard to see how someone can become homeless unless they are more or less a complete loser with no prospects...
    I'm guessing that's because you haven't bothered to look into the issue.

    If you're in a low-paid job where you're barely covering your rent as it is, your landlord increases your rent by 50%, and you can't find anything else to rent in a market where demand vastly outstrips supply, what do you do?

    Because this situation, apparently, makes you a complete loser with no prospects.


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    #9
    Rightwing
    Closed Accounts Posts: 8,101 ✭✭✭Rightwing


    oscarBravo wrote: »
    I'm guessing that's because you haven't bothered to look into the issue.

    If you're in a low-paid job where you're barely covering your rent as it is, your landlord increases your rent by 50%, and you can't find anything else to rent in a market where demand vastly outstrips supply, what do you do?

    Because this situation, apparently, makes you a complete loser with no prospects.

    You go to the State cap in hand. Isn't that what all these family income support schemes are about? I'm not in favour of them, but I would say very few countries are as generous as this one in that regard. Now, if you are offered accomodation in a 3 bed semi, but want a 4 bed detached, then there's not much even our Government can do.


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    #10
    Cordell
    Registered Users Posts: 5,822 ✭✭✭Cordell


    Had the government let the banks fail, and facilitated the easy repossession of properties in default, it would have led to property prices plummeting to the point where people could afford to buy them outright or to get a mortgage for them or to rent them cheaply.
    Plummeting prices mean negative equity for the owners that are keeping up with the repayments, what did they do to deserve to be sacrificed as well?
    The people who over borrowed in the naughties got to keep the properties they borrowed for and the bailout bill was handed to the students and young people had not borrowed for a mortgage before 2007.
    The bailout bill was handed to everyone. Some lost their jobs, others payed more taxes, but everyone chipped in. No one was spared.


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    #11
    oscarBravo
    Technology & Internet Moderators Posts: 28,792 Mod ✭✭✭✭oscarBravo


    Rightwing wrote: »
    Now, if you are offered accomodation in a 3 bed semi, but want a 4 bed detached, then there's not much even our Government can do.

    Just so we're clear, are you arguing that people are sleeping on the streets because the government is only offering them a 3 bed semi instead of a 4 bed detached?

    Because, if you are, I have more productive things to do - like maybe yelling into a hole in the ground - than try to have an intelligent discussion with you.


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    #12
    Rightwing
    Closed Accounts Posts: 8,101 ✭✭✭Rightwing


    oscarBravo wrote: »
    Just so we're clear, are you arguing that people are sleeping on the streets because the government is only offering them a 3 bed semi instead of a 4 bed detached?

    Because, if you are, I have more productive things to do - like maybe yelling into a hole in the ground - than try to have an intelligent discussion with you.

    The old adage, 'beggars can't be choosers' is appropriate if one is homeless.

    A quick google:
    http://www.independent.ie/irish-news/homeless-campaigner-erica-refused-two-house-offers-34981951.html
    Homeless campaigner Erica Fleming, who lives in a hotel with her daughter, turned down two offers of accommodation, according to an internal Dublin City Council report seen by the Sunday Independent. The briefing document states Ms Fleming was offered a two-bedroom apartment in the upmarket Dublin suburb of Mount Prospect Avenue in Clontarf.

    http://www.irishtimes.com/news/crime-and-law/courts/high-court/homeless-family-get-order-quashing-refusal-to-accommodate-them-1.2898095

    South Dublin County Council had found the family ineligible for emergency accommodation in October on foot of its view their homelessness since late September arose from “choices” made by the woman.

    http://www.irishtimes.com/news/social-affairs/over-2-000-social-housing-offers-turned-down-last-year-1.2414025

    Reasons for refusals include barking dogs, the applicant being on holidays and no Mass


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    #13
    Mrs OBumble
    Registered Users Posts: 25,710 ✭✭✭✭Mrs OBumble


    And if the banks had failed how many more unemployed people would there be because of the American multi-nationals leaving ?


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    #14
    realitykeeper
    Registered Users Posts: 4,138 ✭✭✭realitykeeper


    Timberrrrrrrr wrote: »
    Are the people in Apollo house not homeless because they have lost their jobs and can't afford rent/mortgages?

    Are you saying the credit unions and "new banks" would have given unemployed people mortgages?
    The houses were there and they would have been sold to the highest bidder. If the highest bidder could afford very little, then that would have been the selling price.


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    #15
    realitykeeper
    Registered Users Posts: 4,138 ✭✭✭realitykeeper


    Rightwing wrote: »
    It wouldn't.

    Builders are finding it difficult to make a return on investment as it is. Government needs to greatly reduce levies so that builders can build affordable homes and still make a profit. The cost of a build remains the problem.

    "As it is" is different to how it would have been had the banks been allowed to fail. Iceland has no problem building houses, if fact they have had a building boom for years now (see link). That is the power of capitalism, even in a bankrupt country, market forces will quickly save the day if only the politicians would stop trying to "help".

    When a crisis presents itself, it is far better to let the crisis play out. By preventing the crisis, the politicians have made a normal functioning housing market impossible. This is what stagnation looks like and it is going to spead to the rest of the economy.

    The bank part of the national debt should be defaulted on. The economy must be allowed to crash properly before it can start to grow.

    https://www.nytimes.com/2016/12/01/realestate/commercial/iceland-recovers-and-reykjavik-becomes-a-hive-of-development.html?_r=0


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    #16
    amcalester
    Closed Accounts Posts: 4,121 ✭✭✭amcalester


    realitykeeper wrote: »
    "As it is" is different to how it would have been had the banks been allowed to fail. Iceland has no problem building houses, if fact they have had a building boom for years now. That is the power of capitalism, even in a bankrupt country, market forces will quickly save the day if only the politicians would stop trying to "help".

    When a crisis presents itself, it is far better to let the crisis play out. By preventing the crisis, the politicians have made a normal functioning housing market impossible. This is what stagnation looks like and it is going to spead to the rest of the economy.

    The bank part of the national debt should be defaulted on. The economy must be allowed to crash properly before it can start to grow.

    How would the banks going bust reduce the cost of building?


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    #17
    Owryan
    Closed Accounts Posts: 4,024 ✭✭✭Owryan


    Why would new banks move into a market where all the previous banks had gone bust?

    Also, if all the houses in arrears were repossessed and sold on, where do the people who lost those houses go? If they couldnt pay a mortgage how can the buy another gaff?


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    #18
    Get Real
    Registered Users Posts: 888 ✭✭✭Get Real


    realitykeeper wrote: »
    The houses were there and they would have been sold to the highest bidder. If the highest bidder could afford very little, then that would have been the selling price.

    Yeah so you've kind of just defeated your own thread.

    The highest bidder would have been a wealthy person with large cash reserves, so a rich person would have got a house on the cheap, how this benefits "ordinary" people I don't know.

    Anyway another flaw is these houses that would be sold off, where would the people occupying move to?

    It's much more to do with the lack of supply for housing. More people bidding for the one house, price gets pushed up. Simultaneously, people compete to rent property, and the rent increases with demand, the highest bidder gets it.

    This makes rents and home ownership unaffordable for many and gives rise to the situation of today. Not too sure about this hypothetical scenario you have of something which began to unravel almost a decade ago at this stage.


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    #19
    realitykeeper
    Registered Users Posts: 4,138 ✭✭✭realitykeeper


    Get Real wrote: »
    Yeah so you've kind of just defeated your own thread.

    The highest bidder would have been a wealthy person with large cash reserves, so a rich person would have got a house on the cheap, how this benefits "ordinary" people I don't know.

    Anyway another flaw is these houses that would be sold off, where would the people occupying move to?

    It's much more to do with the lack of supply for housing. More people bidding for the one house, price gets pushed up. Simultaneously, people compete to rent property, and the rent increases with demand, the highest bidder gets it.

    This makes rents and home ownership unaffordable for many and gives rise to the situation of today. Not too sure about this hypothetical scenario you have of something which began to unravel almost a decade ago at this stage.
    Rich people getting the houses cheaply is not a "flaw." If that bothers people, they should practice meditation to come to terms with their jealousy issues.

    Ireland has a homelessness crisis. It would be better if the homeless people were those who over borrowed during the boom and not the people who are expected to pay for the people who over borrowed during the boom.

    There would be a building boom here, like in Iceland if capitalism had prevailed and the banks were allowed to fail. With a housing boom, rents would be affordable to the evicted (who over borrowed and defaulted).


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    #20
    realitykeeper
    Registered Users Posts: 4,138 ✭✭✭realitykeeper


    amcalester wrote: »
    How would the banks going bust reduce the cost of building?
    Thats what happen in Iceland.


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    #21
    yosser hughes
    Registered Users Posts: 3,880 ✭✭✭yosser hughes


    realitykeeper wrote: »
    Had the government let the banks fail, and facilitated the easy repossession of properties in default, it would have led to property prices plummeting to the point where people could afford to buy them outright or to get a mortgage for them or to rent them cheaply.

    Furthermore it would have enabled new developers (who had not over borrowed) to start building new housing in a normal functioning housing market.

    What we are seeing now is just the beginning of the pain the country postponed by bailing out the banks. The people who over borrowed in the naughties got to keep the properties they borrowed for and the bailout bill was handed to the students and young people had not borrowed for a mortgage before 2007.

    The rent increases also helped those who borrowed in the naughties to keep their second and third homes to the detriment to the young people who were completely blameless.

    Had the banks not been bailed out, some of those homeless people in Apollo House could be property owners now.
    You are absolutely correct. Unfortunately most people are too stupid or self-interested to see what has happened and is happening.


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    #22
    realitykeeper
    Registered Users Posts: 4,138 ✭✭✭realitykeeper


    Owryan wrote: »
    Why would new banks move into a market where all the previous banks had gone bust?

    Also, if all the houses in arrears were repossessed and sold on, where do the people who lost those houses go? If they couldnt pay a mortgage how can the buy another gaff?
    Why would they not? No competition is a rare luxury for businesses. A new bank would not be exposed to bad debts like the old banks. All the new banks would have to do is not be stupid like the old banks in order to thrive.

    If people made mistakes they should pay for their own mistakes. Other people should not have to be homeless so that the people who over borrowed can go on living in houses.


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    #23
    kippy
    Registered Users Posts: 18,408 ✭✭✭✭kippy


    realitykeeper wrote: »
    Why would they not? No competition is a rare luxury for businesses. A new bank would not be exposed to bad debts like the old banks. All the new banks would have to do is not be stupid like the old banks in order to thrive.

    If people made mistakes they should pay for their own mistakes. Other people should not have to be homeless so that the people who over borrowed can go on living in houses.

    And what would happen all of those tens of thousands of people that worked in banks, financial institutions that suddenly went bust. Wouldn't they be homeless now?
    What would happen the pensioners whose pension funds were invested in those banks either in direct share schemes or as lenders to the banks in the first instance?

    (I am keeping the logic and reasoning here extremely simple for good reason)


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    #24
    amcalester
    Closed Accounts Posts: 4,121 ✭✭✭amcalester


    realitykeeper wrote: »
    Thats what happen in Iceland.

    That's not an answer. Iceland and Ireland may only differ by 1 letter but what happened in one will not necessarily happen in the other.

    How, specifically in relation to Ireland, would letting the banks go bust lower the cost of building?


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    #25
    realitykeeper
    Registered Users Posts: 4,138 ✭✭✭realitykeeper


    kippy wrote: »
    And what would happen all of those tens of thousands of people that worked in banks, financial institutions that suddenly went bust. Wouldn't they be homeless now?
    What would happen the pensioners whose pension funds were invested in those banks either in direct share schemes or as lenders to the banks in the first instance?

    (I am keeping the logic and reasoning here extremely simple for good reason)

    And I will keep my answers simple for a good reason :)

    Those who make bad investments loose all their money.

    Those who loose their jobs suffer hardships.


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    #26
    kippy
    Registered Users Posts: 18,408 ✭✭✭✭kippy


    realitykeeper wrote: »
    And I will keep my answers simple for a good reason :)

    Those who make bad investments loose all their money.

    Those who loose their jobs suffer hardships.

    You are the one who titled the thread "The Irony of Irelands Homelessness Crisis"
    Do you really believe the homeless crisis as we we see it now would have been avoided IF all of those institutions were let fail?

    Suggesting that those who make bad investments lose their money or those who lose their jobs suffer hardships can surely be applied to those who are homeless currently??


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    #27
    realitykeeper
    Registered Users Posts: 4,138 ✭✭✭realitykeeper


    amcalester wrote: »
    That's not an answer. Iceland and Ireland may only differ by 1 letter but what happened in one will not necessarily happen in the other.

    How, specifically in relation to Ireland, would letting the banks go bust lower the cost of building?
    If the government were telling the truth when they said they could not borrow if they let the banks fail, then there would have been mass redundancies in the public sector/civil service. The social welfare supports would then be slashed. That would take a lot of money out of the economy. Naturally, that would cause prices to drop and the minimum wage would fall also. So, with the cost of goods, services and labour lower, the cost of building would be lower.


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    #28
    kippy
    Registered Users Posts: 18,408 ✭✭✭✭kippy


    realitykeeper wrote: »
    If the government were telling the truth when they said they could not borrow if they let the banks fail, then there would have been mass redundancies in the public sector/civil service. The social welfare supports would then be slashed. That would take a lot of money out of the economy. Naturally, that would cause prices to drop and the minimum wage would fall also. So, with the cost of goods, services and labour lower, the cost of building would be lower.

    Again, I will keep this simple.
    Your suggestion would have been to put more people homeless initially in the hope that prices and accessibility to housing would decrease also and these unemployed folks would be able to afford a home - so they'd be unemployed but own a home?
    Look, I don't agree with all the decisions made in 2008/2009 but to force this brand of logic now is just silly.


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    #29
    realitykeeper
    Registered Users Posts: 4,138 ✭✭✭realitykeeper


    kippy wrote: »
    You are the one who titled the thread "The Irony of Irelands Homelessness Crisis"
    Do you really believe the homeless crisis as we we see it now would have been avoided IF all of those institutions were let fail?

    Suggesting that those who make bad investments lose their money or those who lose their jobs suffer hardships can surely be applied to those who are homeless currently??
    The homeless crisis would have happened and it would be history by now. Instead, a far more protracted and insurmountable homeless crisis is just getting started.

    Your second point is valid but those people would be about ten years into resolving their difficulties by now if the banks had been allowed to fail and if the economy had been allowed to crash.


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    #30
    kippy
    Registered Users Posts: 18,408 ✭✭✭✭kippy


    realitykeeper wrote: »
    The homeless crisis would have happened and it would be history by now. Instead, a far more protracted and insurmountable homeless crisis is just getting started.

    Your second point is valid but those people would be about ten years into resolving their difficulties by now if the banks had been allowed to fail and if the economy had been allowed to crash.

    You have no appreciation for the wider impacts of following your path.


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    #31
    realitykeeper
    Registered Users Posts: 4,138 ✭✭✭realitykeeper


    kippy wrote: »
    Your suggestion would have been to put more people homeless initially in the hope that prices and accessibility to housing would decrease also and these unemployed folks would be able to afford a home - so they'd be unemployed but own a home?
    Look, I don't agree with all the decisions made in 2008/2009 but to force this brand of logic now is just silly.
    The houses would have gone cheaply to the highest bidders. In 2007/8 there were enough houses to satisfy demand so everyone would have had a roof over their head either as an owner or renter. The prices of houses (and rent) would have been low.

    I don`t have to force this "brand of logic." If the market forces are not allowed to fix the problem, the problem will not get fixed.


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