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House prices bottom out?
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rent allowance is 500 approx for a single mother outside the citys, so you think a mother with 2 kids can rent a house for 250 per month.Thats not realistic.it would be easier to have nama give units to local authority ,then authority gives units to people on the housing list .
Then rent allowance bill goes down, government doesnt want to do this as
lower rents = lower house prices ,many landlords rely on ra to pay the mortgage.A good start would be to reduce civil service pensions and salarys in the higher grades ,and reduce wages/bonus.s in aib and bank of ireland.
In dublin ra limit is 930 per month for a single mother.
It seems to me prices will continue to fall for the next few years,the governments only plan is to try to renegotiate the national debt and reduce the interest rate on loans from the ecb.0 -
lower rents = lower house
I would have to say that's spurious at best, House prices are crashing down around us and rental prices have only seen marginal drops (averagely) but have ceased dropping and in some areas have increased (slightly).
Im terms of house prices bottoming, you can bandy around all the facts and figures under the sun but the most alarming factor is that house prices are still actively falling, when we see these graphs flattening out we can start the 'bottoming out' conversation.0 -
SoupyNorman wrote: »I would have to say that's spurious at best, House prices are crashing down around us and rental prices have only seen marginal drops (averagely) but have ceased dropping and in some areas have increased (slightly).
Im terms of house prices bottoming, you can bandy around all the facts and figures under the sun but the most alarming factor is that house prices are still actively falling, when we see these graphs flattening out we can start the 'bottoming out' conversation.
Maybe better this way -
Lower rents ⇒ Lower house prices?0 -
Its the propping up of the market that is causing the rise in rents also thought lack of available quality housing. I am not suggesting that this is unfair as the government should do what is right and practicable to help people who are struggling BUT if people are not going to be able to sustain their debt then this needs to be faced up to.
There needs to be an across the board right-down of a % mortgage debt for people who have paid and those who have not for fairness to reflect the new market. After that it should be back to normal business and the reality of people being able to pay their mortgages or not. Without this and with other interference in the market we are still in limbo.
For example all the tradespeople and construction employees who where on big money in the boom are not going to be in that position again for a long time (if ever). If they have big mortgages then this needs to be dealt with for their sakes. The state should buy the property's at knock down prices from the banks and then rent them back to the family's involved for an amount that would cover the governments knock down purchase price. This would mean being able to stay in the house. To stop everyone doing this is it would mean that they would never own the house unless they bought it back at a later stage at the reduced market levels.
We need an end to:
Interest only payments.
*50,000 in Arrears.
*Banks owned by state and unable to take action.
*Interference in the market.
*Outdated bankruptcy laws.
People need to be freed from debt also to get the domestic economy moving again. Not only banks.
No Nama should not be giving loans.0 -
Join Date:Posts: 30620
The inverse of this- is why should the responsible people, who didn't go on multiple sun holidays every year, and who bought a modest apartment or house- irrespective of whether or not they have a mortgage- bail out their neighbours who lived the high life for the past 15 years? The virtue of their prudence, far from being rewarded, is in fact being punished.
I accept fully that Irish bankruptcy law, particularly as it pertains to personal bankruptcy- has to change. I do not see how or why anyone should have any expectation to remain in their nice home- whether or not they are paying rent- or indeed why should they have the option to purchase it at a reduced price at some stage in the future?
While debt forgiveness to a certain extent is almost inevitable- there has to be an element of punishment too- perhaps by repossessing their homes and offering them rented accommodation in any of the properties that NAMA is unable to dispose of? Any property in any of the larger urban areas should be considered fair game for repossession- and appropriate action taken. There should be a commitment to provide housing for anyone undergoing the debt forgiveness process- but not of their choosing, and there should be an automatic procedure in place to repossess any residential property or other assets that they might have.
Its all well and good to have wishy washy ideas about a NAMA for the little people- sure aren't all the banks nationalised anyway- lets forgive mortgage debt (they aren't all nationalised anyhow- BOI are independent and look set to be able to self-fund/self-finance, unlike the other institutions, with only a minority state ownership). The fact of the matter is this country is bankrupt. Despite the bailout- we are continuing to spend (aside from any bailouts) over 16 billion a year more than our tax revenues. We are also in hock to the ECB, the IMF, the ERSF and other bodies to the tune of 210 billion........
Where do you think you're going to get the money to fund this debt forgiveness from? Keep in mind Irish mortgage debt is almost 600 billion (thanks to our uniquely Irish pre-occupation with 'owning' property and a vitreous hatred of renting). If you decide- we'll wave a magic wand and forgive 20% of mortgage debt- thats another 120 billion that you have to magic out of somewhere. Regardless of what you imagine- the government doesn't have a magic money tree growing on Merrion row that they can give a shake to- to fund any of these plans..........
Added to this- the 50,000 in arrears- excludes those who have already come to arrangements with their banks, or turned their mortgages into interest only payments- those in current trouble are actually closer to 145,000 in number- of which almost 30,000 haven't actually made any payments in over a year, and even of this figure- its only counting those in arrears of over 120 days.
So- we reform personal bankruptcy law- fair enough- Irish law is almost uniquely harsh in the personal era- however similar to other jurisdictions- all assets are fair game- we can have our socialist bent if we like- but if you look at even nominally socialist countries- all they guarantee personal bankrupts, is high density council accommodation. We should do likewise.......
Yes- we have a problem- however rewarding people for living the high life- is not a solution- we need to house them, but thats it........0 -
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I was talking about facing up to the reality of the situation and future prospects of a mortgage being paid. A portion of all mortgages should be written down even for those who are not in arrears. If they bought in the last number of years.
People who have paid their mortgages or those who bought before the boom should be happy that they where and are in a position to pay their mortgage.
We are all going to have to pay for all this crap as a society anyway because of a lack of regulation. Why should people who don't pay their mortgages still have ownership of the properties that they live in long term. At least they would be state owned assets if it was done as I suggested. That is fairer on those lucky enough to still be able to pay a private mortgage.
We need to know the real value of property in Ireland. A value based on income levels, area, availability and standard of the property. All this interference in the market is typical and only protects vested interests.0 -
smccarrick wrote: »
Where do you think you're going to get the money to fund this debt forgiveness from? Keep in mind Irish mortgage debt is almost 600 billion (thanks to our uniquely Irish pre-occupation with 'owning' property and a vitreous hatred of renting). If you decide- we'll wave a magic wand and forgive 20% of mortgage debt- thats another 120 billion that you have to magic out of somewhere. Regardless of what you imagine- the government doesn't have a magic money tree growing on Merrion row that they can give a shake to- to fund any of these plans..........
I know TBA but I am clinging for some reality and hope
You are right but the reality is that we are doomed either way. We can pretend that assets are worth more then they are. We can pretend that by some miracle that all the construction workers will become programmers.
If two people have a mortgage for 300k (for a house worth 200k or less) and can't pay or have no hope in the future of paying anything off it there is no point pretending that this asset is worth 300k on the books of the banks.
I think the time has come to put it all out there in all its ugliness and see the real debt that awaits us. This might mean that we don't have the best paid public servants and government in the world any more. It might mean normal and fair pension levels. It might mean a lot of pain up front but in the long run we will be better off facing up to it and getting started on the recovery.0 -
I was talking about facing up to the reality of the situation and future prospects of a mortgage being paid. A portion of all mortgages should be written down even for those who are not in arrears. If they bought in the last number of years.
People who have paid their mortgages or those who bought before the boom should be happy that they where and are in a position to pay their mortgage.
We are all going to have to pay for all this crap as a society anyway because of a lack of regulation. Why should people who don't pay their mortgages still have ownership of the properties that they live in long term. At least they would be state owned assets if it was done as I suggested. That is fairer on those lucky enough to still be able to pay a private mortgage.
We need to know the real value of property in Ireland. A value based on income levels, area, availability and standard of the property. All this interference in the market is typical and only protects vested interests.
First, I wholeheartedly agree with your general point - that we must face up to reality and stop pretending. I also agree that some form of realising losses is needed. But I disagree with how we allocate those losses.
Rather than giving money directly to mortgage holders to write off debt, we should proceed with repossessions and plug the resultant holes in the banks. That sounds backwards to what most people think, but I think it's immeasurably better.
First, because it avoids moral hazard. And second, because this way we find a floor on property prices faster. If we hand over money directly to mortgage holders it plasters-over underlying problems without really resolving them. Better to find the floor by repo/firesale and allocating the money into the banks to meet the shortfalls.0 -
Join Date:Posts: 30620
Why do you imagine that any of these mortgages- even if you write them down- will ever be paid?
We had over 200,000 men involved in the construction industry- 120,000 of whom left school since 1994 without a leaving cert. These guys were earning more as brickies than consultant surgeons........ They are *never* going to be in a position to pay their mortgages- and most have zero intention of taking a job at the average industrial wage (currently 31k according to the ESRI)- and why would they, when some of them earned 8 times this during the boom?
Sure- we can call writing off debts/ writing down the value of property as the first step in any solution- however its not........
For every one of these 145,000 who are currently incapable of paying their mortgage- there are over 200,000 in unsuitable accommodation- purchased in the past 15 years, who are paying their mortgages. Why do the 145k defaulters get a free-ride, while those who are able to pay their mortgages are incapable of moving into child friendly accommodation- even while their defaulting neighbours are having their debts written down?
We built very few of ye olde houses with their little gardens for the kids to play in, garage for dad to store whatever it is that gets stored in garages etc- over the past 20 years. Of those that we did build- a significant portion of them are the properties that are in arrears/default.
If we are writing down the book value of these properties- the folk who are currently paying their mortgages- but in unsuitable property (e.g. a family of 4 in a 2 bed apartment for example) should have first dibs on these- over and above the current occupants who are not paying their mortgage..........
The galling thing is that the people who did get to party for the past 15 years- are getting off scott free......0 -
Treehouse72 wrote: »Rather than giving money directly to mortgage holders to write off debt, we should proceed with repossessions and plug the resultant holes in the banks. That sounds backwards to what most people think, but I think it's immeasurably better.
We need to change the bankruptcy laws before we go down this route so that people who are unfortunately in this situation can have a clean sheet to start over again in a period of time0 -
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We need a change to the bankruptcy laws for a couple of reasons.
One of the reasons is to insure that banks are aware of the fact that when they underwrite a mortgage that there is a Distinct possibility that they will not get repaid. This will have the effect of forcing them (banks) to take more care when qualifying mortgagee's.
We can sit here and point the finger all day long but the truth is that we were all to blame. We all rode the pig, we all benefitted from the boom,Some more so than others but we all benefitted. Now we all have to pay.0 -
We need a change to the bankruptcy laws for a couple of reasons.
One of the reasons is to insure that banks are aware of the fact that when they underwrite a mortgage that there is a Distinct possibility that they will not get repaid. This will have the effect of forcing them (banks) to take more care when qualifying mortgagee's.
We can sit here and point the finger all day long but the truth is that we were all to blame. We all rode the pig, we all benefitted from the boom,Some more so than others but we all benefitted. Now we all have to pay.
Don't agree. Some people didn't ride the pig and are paying now through higher taxes and if some people have their way they will end up paying other peoples mortgage writedowns into the future0 -
Don't agree. Some people didn't ride the pig and are paying now through higher taxes and if some people have their way they will end up paying other peoples mortgage writedowns into the future
Sure you did, be it firsthand thru the employment derived from the boom or from higher taxes raised from stamp duty, income tax etc.which lead to a more bloated Civil service, higher benefits for pensioners, people on the dole etc.etc. Etc.
You benefitted from the knock on effects of the boom too.
All our boats rose with the tide.0 -
Join Date:Posts: 30620
Sure you did, be it firsthand thru the employment derived from the boom or from higher taxes raised from stamp duty, income tax etc.which lead to a more bloated Civil service, higher benefits for pensioners, people on the dole etc.etc. Etc.
You benefitted from the knock on effects of the boom too.
All our boats rose with the tide.
Not all boats rose with the tide........
There were approximated 37,000 more public sector employees in 1994 than there are now (and approximately 8,000 more civil servants than currently).
Certainly public sector pay rose by 59% on average between 1999 and 2008- however inflation totalled almost 46% in the same period. This ate up a lot of the additional pay given to the public sector, increases for social welfare recipients and pensioners etc. Short of doing a big Mac index (a la The Economist) and using the core price of a staple, or a basket of staples- as a means of measuring purchasing power......
Yes- our social welfare is now above that of several of the OPEC oil producing countries- which surely shows how we totally lost the run of ourselves......?
I'm not sure what happened to all the taxes that accrued from stamp duty- however given that these taxes were part of the mortgages that people were borrowing- using this as an example of largess- has to be factored as at least a portion of our current liabilities to be paid back.........
There are significant numbers of people who were not on social welfare, were not on pensions and whose sole benefit from the boom was a reduction in headline tax rates- which in itself was not a monumental amount (and we all got slaughtered in indirect taxation in any event).
Lots of people had their 3-4 foreign holidays a year, their new car in the driveway, their equity release on their property to fund extravagant livestyles etc- but lots of people didn't get these either........
My net pay is now back where it was in 1998- and I'm one of the lucky ones, I have a job...... Meanwhile I've also two kids- and a big mortgage to pay. My neighbours laugh at me and call me a fool, I'd be better off on social welfare- what gives?
We have created an entire generation of the 'entitled'- and good luck trying to get these entitlements back off them.0 -
You're changing your story here, first you said "we are all to blame" now after being challenged you've retreated to "we all benefited".Sure you did, be it firsthand thru the employment derived from the boom or from higher taxes raised from stamp duty, income tax etc.which lead to a more bloated Civil service, higher benefits for pensioners, people on the dole etc.etc. Etc.
You benefitted from the knock on effects of the boom too.
All our boats rose with the tide.
The truth is that we're not all to blame, this is a lie spread by the developers and incompetent government officials who awarded themselves massive salaries and rode around in helicopters while they made the disastrous decisions that led us off the cliff, after which they retired to six-figure pensions and mansions in their wives' names safe from prosecution.
While the rest of the population may have benefited incidentally from the bubble, that does not make it our "fault" -- if you steal €10 and spend it in my shop, does that mean I share the blame for your theft?
If everyone is to blame, nobody is to blame. That's why we keep hearing this lie over and over again from certain sections.0 -
I've gotten sick of this "WE"
"WE partied during the boom"
"WE lost the run of ourselves"
"WE created a property bubble"
no we didnt
it was all done by the select few who were well off anyway, but still wanted more
and now the "working class" man, who lived within his means and only incidentally gained a few minor perks, is the one footing the bill0 -
The people I know who went crazy were generally the working class and not the professionals. When a plasterer has bought 3 houses on top of his home in the space of 7 years I think you can say he is the author of his own financial situation. The people who never considered ramification of a change in the market reject fundamentals of property investment are to blame. They came from all walks of life and were certainly not well off to start with . Ithe groutch wrote: »no we didnt
it was all done by the select few who were well off anyway, but still wanted more
and now the "working class" man, who lived within his means and only incidentally gained a few minor perks, is the one footing the bill
I was lucky enough to be in high demand during the boom and took massively high daily rates. The nation did it to themselves through financial immaturity. People getting cars as part of their mortgage and never thinking that out were not wealthy people. Lots of silly stuff done by lots of people with no clear demarcation of prior wealth.
That is what I see. The press only report on big cases but I know people in the DSFA and FAS. They are seeing people who own more than one property coming in after gambling the equity in their family home. I didn't do something foolish but I still understand the use of "WE" even though it is not me.0 -
desertcircus wrote: »The comments about how people aren't going to get a three-bed semi-d in south Dublin for 120k seem to miss a big point: there's absolutely no reason why prices won't fall that far. If banks refuse to lend more than 90% of the price of a house to a maximum loan of three times your salary, then the median house in Dublin will go for about three times the median wage plus about eleven per cent. If the median wage is 30,000, then the median house will go for 100k. That's it; there's nothing else to get. Houses will eventually sell for as much as the bank are willing to lend to people plus deposit. That means that half the houses in the country will be going for about a hundred K - once prices have recovered from the overshoot.
At some point, the average house in Ireland will fall below a hundred thousand quid. And it won't be quick and painless. How many people in the country have the necessary deposit to get a mortgage now? How many of those would be approved for a mortgage? And how many of them are in any mood to buy a house? Until the number of people meeting those criteria goes above the number of houses for sale, we'll keep sliding.
I think you are extrapolating the median wage (of an individual worker) as the average household income. I don't have the statistics to tell if couples are the majority or what but anyway:
A proportion of first time buyers are couples, and a proportion of those couples are going to have two incomes. In the case of two income families, their household income is going to be significantly higher than 30,000, and their borrowing power proportionally greater.
Therefore, comparisons with "normality" 20-30 years ago, when women had to retire from public service when married and so on, are unlikely to be valid.
Anecdotal: Each and every one of my friends (in their 30's) who have bought houses have done so with 2 incomes.0 -
Why don't we just go after those who broke the law? These people are legally to blame. If we were to blame everyone who got a pay rise or bought a house we'd be here forever. Do the Icelandic people blame themselves for their banks going to the wall?
It's looking like there will be no prosecutions in the Anglo case, the Seanie Fitzpatrick one man bank, Quinn's dodgy dealings, the planning backhanders... all these things and more. Surely we can all agree that these people are more to blame than anyone else because they acted outside the law?
Yes we're all taking, or are going to take paycuts because the pool of money left in the state is drying up. But this maschoism is misplaced I think - we're doing it because we have to, not because we're culpable.
During the boom poor people who wanted to buy anything had to take out a loan as they were priced out of houses, cars and other major expenditure items. They were offered cheap money by the banks and the level of relative inequality was such that there was social pressure to take on these debts. To blame them now for being hoodwinked is an incorrect appropriation of blame.
That said, anyone who bought multiple properties were and are engaged in property speculation and property speculation is a definite contributor to our current malaise. According to David McWilliams, these people were often professionals looking for investment vehicles and looking to get on the gravy train. I don't doubt that there were some lower level earners doing the same too.0 -
rustyregan wrote: »Why don't we just go after those who broke the law? These people are legally to blame. If we were to blame everyone who got a pay rise or bought a house we'd be here forever. Do the Icelandic people blame themselves for their banks going to the wall?
It's looking like there will be no prosecutions in the Anglo case, the Seanie Fitzpatrick one man bank, Quinn's dodgy dealings, the planning backhanders... all these things and more. Surely we can all agree that these people are more to blame than anyone else because they acted outside the law?
Yes we're all taking, or are going to take paycuts because the pool of money left in the state is drying up. But this maschoism is misplaced I think - we're doing it because we have to, not because we're culpable.
During the boom poor people who wanted to buy anything had to take out a loan as they were priced out of houses, cars and other major expenditure items. They were offered cheap money by the banks and the level of relative inequality was such that there was social pressure to take on these debts. To blame them now for being hoodwinked is an incorrect appropriation of blame.
That said, anyone who bought multiple properties were and are engaged in property speculation and property speculation is a definite contributor to our current malaise. According to David McWilliams, these people were often professionals looking for investment vehicles and looking to get on the gravy train. I don't doubt that there were some lower level earners doing the same too.
Bit of an incoherent rant there... if they are legally to blame, they will be brought to court. Just note that in Ireland its very difficult to get a conviction of white collar crime. However, what will this solve? Sure it will be nice to see some justice, but its not going to solve anything. Apportioning blame, as you do, is a very subjective matter, and one usually finds, in Ireland especially, that everyone else is to blame!
Claiming people who borrowed were "hoodwinked" is a stretch of the imagination though, the hint is in the name - if you borrow, you must at some point in the future, give it back. There is no way to miss this point, a 5 year old understands the concept of borrowing. So you must conclude that these borrowers wilfully ignored the reality of the situation, and therefore are 100% culpable for their own debts, which they entered into freely.
There was "social pressure" to take on these debts. What age are these poor unfortunates? Are they giving loans to children in the playground now? Social pressure my arse, there was greed, envy and one-upmanship, and a sense of entitlement.0 -
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Bit of an incoherent rant there... if they are legally to blame, they will be brought to court. Just note that in Ireland its very difficult to get a conviction of white collar crime. However, what will this solve? Sure it will be nice to see some justice, but its not going to solve anything. Apportioning blame, as you do, is a very subjective matter, and one usually finds, in Ireland especially, that everyone else is to blame!
No they won't be brought to court, even though they broke the law. Yes it's difficult to get a conviction for white collar crime, but crime is crime and white collar crime is a huge cost to the economy. What would it solve? It would mean that there would be a deterrant for this sort of criminal activity in the future. Apportioning blame is not a subjective matter when the law has been broken and regulations have been flouted. Ireland is a great country, we do take the blame when we're at fault, there's no need to put ourselves down due to some people bankrupting the place.
Wasn't saying they don't have to pay it back. I am saying though borrowers are not individually to blame for the situation the country finds itself in. I never said they don't have to pay it back. I presume you inferred this.Claiming people who borrowed were "hoodwinked" is a stretch of the imagination though, the hint is in the name - if you borrow, you must at some point in the future, give it back. There is no way to miss this point, a 5 year old understands the concept of borrowing. So you must conclude that these borrowers wilfully ignored the reality of the situation, and therefore are 100% culpable for their own debts, which they entered into freely.
In any society where this is a spike in relative inequality, such as usually happens before an economic meltdown, taking out loans is seen as the only way to acquire goods. From listening to people, many were encouraged to buy houses as this was seen as sensible investment despite the disparity between their incomes and the size of the loans. I don't agree that there was excessive greed, envy, one upmanship and sense of entitlement - I think people had little choice other than to borrow.There was "social pressure" to take on these debts. What age are these poor unfortunates? Are they giving loans to children in the playground now? Social pressure my arse, there was greed, envy and one-upmanship, and a sense of entitlement.0 -
rustyregan wrote: »During the boom poor people who wanted to buy anything had to take out a loan as they were priced out of houses, cars and other major expenditure items. They were offered cheap money by the banks and the level of relative inequality was such that there was social pressure to take on these debts. To blame them now for being hoodwinked is an incorrect appropriation of blame.
Good god man. Social pressure to take on loans to buy items they did not need?
Little choice but to borrow?
Have you ever heard of personal responsibility?
Have you ever heard of 'the value of your investment may go down as well as up'?
Have you ever heard of doing without something which you cannot afford?
And lastly, have you ever heard of saying 'No thank you!'0 -
rustyregan wrote: »No they won't be brought to court, even though they broke the law. Yes it's difficult to get a conviction for white collar crime, but crime is crime and white collar crime is a huge cost to the economy. What would it solve? It would mean that there would be a deterrant for this sort of criminal activity in the future. Apportioning blame is not a subjective matter when the law has been broken and regulations have been flouted. Ireland is a great country, we do take the blame when we're at fault, there's no need to put ourselves down due to some people bankrupting the place.
Wasn't saying they don't have to pay it back. I am saying though borrowers are not individually to blame for the situation the country finds itself in. I never said they don't have to pay it back. I presume you inferred this.
In any society where this is a spike in relative inequality, such as usually happens before an economic meltdown, taking out loans is seen as the only way to acquire goods. From listening to people, many were encouraged to buy houses as this was seen as sensible investment despite the disparity between their incomes and the size of the loans. I don't agree that there was excessive greed, envy, one upmanship and sense of entitlement - I think people had little choice other than to borrow.
If you have proof of a crime, then go to the gardai, otherwise you are just making wild accusations. What crime was committed? What exact law was broken, by whom, and when?
I did infer that you meant they should not pay the loans back, apologies.
I am not blaming individual borrowers for ruining the country, there were many facets to the downfall of the country. The people voted the government back in, twice, believing the fairy stories. The government thought it had invented alchemy, making gold out of lead. The banks could borrow for next to nothing as the euro interest rates remained at record lows - totally unsuitable for Ireland where the cost of living, property, rent was raging out of control, with annual increases in the double digits.
The government was being patted on the back for this "growth". The banks were making a fortune and their shareholders where patting them on the back for it (and delighted with their dividends). Average punters were patting themselves and each other on the back for getting on the property ladder and watching the value of their homes increase, and then got into investing in property too for good measure.
It was a total fairytale and nobody wanted to hear any different. The contrary voices were there to be heard, if someone went to the trouble of thinking the thing out for themselves instead of listening to the likes of politicians, bank-employed economists, and friends and family who had made a pile of paper money by doing absolutely nothing productive.
There is blame to go round, plenty of it, and it's uncomfortable to hear that its not all some bogeyman's fault, but that's the truth of it.0 -
Good god man. Social pressure to take on loans to buy items they did not need?
Little choice but to borrow?
Zamboni - nice name. Nothing to do with the excellent, now reincarnated music blog by any chance?
Re the social pressure, I've actually heard many people relating similiar stories - that their parents, workmates, etc advised them to buy overpriced houses with mortages. The newspapers with their real estate advertising money were at it - it was widespread. I remember hearing about people getting their parents to lodge money into their accounts temporarily in order to beef up their applications. Whether they took out huge loans or not was up to their judgement of the situation. Most places, it was impossible to buy a house on the average industrial wage so loans were required. It was very much the culture of the country at the time to buy rather than rent. I'm not making it up, that's just the way it was.Have you ever heard of personal responsibility?
Have you ever heard of 'the value of your investment may go down as well as up'?
Have you ever heard of doing without something which you cannot afford?
And lastly, have you ever heard of saying 'No thank you!'
I've heard of the first one, I'm quite familiar with it. I'm not writing in a personal capacity.
Re. number two, I hear ads on Newstalk these days inviting people to spread bet on the US stock exchange, which, given the approching end of QE2 is not the wisest thing in the world imho. No mention of the possible investments going down in value as well as up. In any case, this warning is usually given out for financial products and rarely in the case of mortages or other very large loans.
Heard of number three and four also. I'm not saying that people always used logic or circumspection.0 -
rustyregan wrote: »Why don't we just go after those who broke the law? These people are legally to blame. stc....
Seriously strange view you have there. In most cases the bankers did nothing actually illegal. So they aren't legally responsible for anything.
House prices were really the only thing that went up as a result of the boom. Cars and appliances didn't really go up to the extent you needed a huge loan to buy them above what you wanted to replace.
Name some of the planning backhanders I know there is always suspicion but is there any on a particular modern case?
People always want stuff but if they can't afford it they should know that. The banks were willing to take higher risks because they had more money they should have known better. It was still loaning money to people here it is not the same as Icelandic model where it was money invested in poor investments available on the open market. Very very different issue. Many people in financial trouble are those who took out massive loans for personal LUXURIES or foolhardy property investments.
Many people who invested in property used home equity and were not professionals. I saw them doing at the time when viewing houses and I hear about them from people who work with people in financial trouble. From my anecdotal evidence it does not seem to be professionals in the most trouble but often those people who relied on the building trade as an income.
You are effectively blaming the banks as if they were some loan pushers. I was on a 6 figure sum and I didn't buy an expensive car managing not to bow to social pressures. Still don't see why people were buying huge 4x4 while living in the city. The banks didn't come looking for me to borrow money other than the usual junk mail. I don't think I have some amazing will power either.0 -
the groutch wrote: »I've gotten sick of this "WE"
"WE partied during the boom"
"WE lost the run of ourselves"
"WE created a property bubble"
no we didnt
it was all done by the select few who were well off anyway, but still wanted more
and now the "working class" man, who lived within his means and only incidentally gained a few minor perks, is the one footing the bill
If buying a house for €100K in 1998 and now have no mortgage, driving a 10 year old car, saving every month with 3 kids and going on one camping holiday every 2 years then yes I lost the run of myself FFS!!!!! :mad:
Nearly forgot: threw all those "pre-approved for 40K" loans in the bin!
I guess though if I'm honest, being on the dole previously, and having lived in England, and realised that there no one gives a sh1t if you end up on the street, and coming back here to realise it's no different, gave me a bit of perspective. Seeing all the homeless people in Dublin at the height of the boom really highlighted this.
If Mummy had handed me everything and I only knew full employment, I might have acted differently.0 -
Just about the white collar crime aspect of the whole thing:
We're all agreed that certain individuals in Anglo Irish Bank enriched themselves contrary to banking legislation therefore commited crimes? Maybe some people don't think this is the case, and I'm sure the case against those certain individuals will unfortunately flounder, but lets face it, in most developed western countries they would go to jail.
Quite a good article from the indo (for a change) here on the issue: http://www.independent.ie/business/irish/white-collar-crime-probes-reveal-states-puny-powers-2567668.html
Re the planning backhanders, the only person to go to jail in relation to this is the Flood Tribunal whistleblower, Dunlop. That's gas, isn't it? His evidence is reliable enough to put him in jail, but not reliable enough to put any of his co-accused in jail. Hmmm, nice logic.
Re. National Irish Bank, according to RTE primetime programmes, large loans were given to prominent politicians and prominent businessmen without any paperwork being required at all. This contravenes banking legislation and so it's illegal. Yes, there was little regulation at the time, but that doesn't stop the fact that it was illegal. Again no criminal action. It would probably open an unpleasant can of worms, given the names of those involved. http://thestory.ie/2009/12/23/michael-fingleton-inbs-and-mespil/
Re. going to the Gardai about this stuff, it would serve absolutely no purpose. It's all in the public domain and due to a lack of legislation, funding and political will nothing will be done about it in the near future. It doesn't mean it isn't wrong, that people shouldn't comment on it and their role in bringing the country to this impasse. Those who have broken the law, weak as it is, are the people who are most to blame.0 -
Not agreed and not following bank legislation is not the same as cimmiting a criminal offense.rustyregan wrote: »Just about the white collar crime aspect of the whole thing:
We're all agreed that certain individuals in Anglo Irish Bank enriched themselves contrary to banking legislation therefore commited crimes? .
Flood tribunal was over things that happened in the 80s and 90s not really to do with back handers during the boom. Any more recent claims which happened during the boom.0 -
Ray Palmer wrote: »Not agreed and not following bank legislation is not the same as cimmiting a criminal offense.
Flood tribunal was over things that happened in the 80s and 90s not really to do with back handers during the boom. Any more recent claims which happened during the boom.
Much of the developments in the Carrickmines area were undertaken during the boom, the deals being done in the 90s.
Re banking legislation, yes it is. The word is legislation - this is derived from legal - conavening this is illegal. Undertaking illegal activities is a criminal offence.0 -
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rustyregan wrote: »Much of the developments in the Carrickmines area were undertaken during the boom, the deals being done in the 90s.
Re banking legislation, yes it is. The word is legislation - this is derived from legal - conavening this is illegal. Undertaking illegal activities is a criminal offence.
Not quite accurate.
If those regulations are not enforced- you cannot claim that failing to adhere to the regulations is an illegal (or even a criminal) act. Having a law on the statute book- is step 1- enforcing it is step 2. Regardless of what Michael Sommers or anyone else did- if the regulator was not actively enforcing the regulations at his disposal- good luck to you proving any of these guys undertook criminal activity. As for the politicians- much as I wish incompetence were a crime- it isn't. The only official who was caught redhanded (aside from Liam Lawlor) seems to have been George Redmond.
It might appear that the best way to chase these goons might be by ignoring their failures with the Financial Regulator- and having the ODCE chase them instead.
Keep in mind that the complaint of our European colleagues at the time was that Ireland was the wild-wild-west regarding lack of/lack of enforcement of- financial regulation. Our Irish failures were not the only failures that happened as a result of the regulator not giving a damn- several German banks fell (including a 60billion failure) and one French subsidiary also fell......
Much as I'd happily support lining the bankers up against a wall and shooting them- its a fate far too kind for the Irish Financial Regulator.........0
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