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

Cyrus

schmittel wrote: »

Zenify is spot on, there is a snob thing going on that Bray is full of scumbags, but I think that is less true now than it used to be, but as you say it persists.

Greystones boomed because that snob value was alive and well 20 years ago. Once the dart extended, those who fancied southside coastal living but priced out of Dalkey etc flocked to Greystones and skipped Bray.

However I think over the next 20 years Bray will be playing catch up. It has everything going for it.

Better transport links than Greystones.

Better amenity/infrastructure potential. The main street and side streets are a bit dreary now, with things like vaping and fix your mobile phone shops, but it would not take much to transform it. Greystones is just one main st full of coffee shops.

The seafront is far nicer and more functional than Greystones - it is a feature in Bray whereas Greystones feels like it has its back to the sea.

The area around that Ellerslie villas house is really nice, leafy and mature, short walk to the seafront, bars, restaurants and the dart.

Sure there are some less attractive parts with some dodgier people but they are no closer than the same issue in the premium southside locations - eg Killiney/Ballybrack.

It would not take many well heeled Dubliners to move in, bringing more disposable income that will see the vaping shops etc give way to something more upmarket, and transform Bray into something really quite special.

If you look at the development of south Dublin/North Wicklow over the past 50 years the glaring anomaly is Bray. I cannot see it lasting too much longer!

i cant say id be totally surprised if you were right, and there are some really nice parts, that house i linked on king edward road (and there is a whole road of them) is a stunner and reasonable money compared to similar a few km away.

Smiley11

Sweet.Science wrote: »

I really dont know how they can extend the ban on viewings but looks like it will be . You are literally stopping people buying homes for a year

Its awful. I actually don't know what we're going to do because our kids need stability. 14 months & counting & if we can't view a vacant house for 8 more weeks, we won't be in our home this christmas either. I think the market reaction to this would potentially be hysterical...in the worst sense of the word.

We're one family of thousands of people in a similar position.

Digiteer

Yep, far too many developments atm, 1’000’s of apts coming online in 2020.!!

Digiteer

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.!!

Sweet.Science

Smiley11 wrote: »

Its awful. I actually don't know what we're going to do because our kids need stability. 14 months & counting & if we can't view a vacant house for 8 more weeks, we won't be in our home this christmas either. I think the market reaction to this would potentially be hysterical...in the worst sense of the word.

We're one family of thousands of people in a similar position.

We are the same. Sale agreed in December but vendor cant view houses of her own

decreds

1percent wrote: »

I can't see China being a global Hegemon, regional yes but they don't have the force projection abilities to be global. They have a large army but mainly conscripts and a very limited blue water navy. The concept of Mianzi or to save face means its all about the show, well put together young lads with polished guns and big hats. They are completely untested in an actual fight.

I would compare them to Germany (less the war guilt) not the US, they will be the dominant force in their theater, and important on the global stage but but not the dominant force. This will begin when the US begins to retreat in on itself either after an economic, military or political shock and will become a regional power. Taiwan will be left to fend for itself and will unite after a dogged resistance, Korea will enter their economic orbit and possibly reunite under Chinese guidance, indochina will become Chinas Mexico more so than it already is.

The big contender will not be Europe or the US it will be India! I expect the main source of conflict will be between the two of these powers and India has been a sub continent whose people have nearly always been subjects to an outside ruling class.

I think the coming century will be one of regional powers, US, Europe and China each working with and against the other two depending on the prevailing needs and threats of the time. The middle east will be left to smash itself to pieces as their oil is no longer needed and maybe Iran or Turkey could build it up to become a 4th power.

Africa is where it will be at, and I think Europe has the advantage there, they speak our languages and we have enough colonial guilt that it will be an equal economic trade as opposed to the Chinese debt diplomacy as we see now with the belt and roads.

How does this affect irish property? Well the Chinese might build a sizable portfolio but if they start playing silly bugger they would be easy enough to be ignored. As they say out east, the mountain may be big, but it is far away.

Decent post, but i disagree on the suggestion of a Africa/Europe partnership . China is building infrastructure all over Africa right now and are mostly not even charging a cent for it, the exchange is the Chinese will build it and be granted citizenship.


China will have Africa under their thumb within a decade.

Villa05

Indo headline
Housing crisis: Central banks doubts threaten plan for 'cheaper' homes

Everyone bar the dogs on the street are warning against this plan
Note how the advisers are viewed negatively through the headline

Sorry can't be bothered linking the tripe, behind paywall

PropQueries

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

Zenify

Villa05 wrote: »

Indo headline
Housing crisis: Central banks doubts threaten plan for 'cheaper' homes

Everyone bar the dogs on the street are warning against this plan
Note how the advisers are viewed negatively through the headline

Sorry can't be bothered linking the tripe, behind paywall

In my mind the only reason this bill would be passed by a sensible person is due to corruption.

I'm not usually a government basher but this is just crazy. It's simply a workaround the central bank rules with tax payers money... putting more money into the pockets of landowners and builders. At the expense of house buyers and tax payers.

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!

awec

schmittel wrote: »

Zenify is spot on, there is a snob thing going on that Bray is full of scumbags, but I think that is less true now than it used to be, but as you say it persists.

Greystones boomed because that snob value was alive and well 20 years ago. Once the dart extended, those who fancied southside coastal living but priced out of Dalkey etc flocked to Greystones and skipped Bray.

However I think over the next 20 years Bray will be playing catch up. It has everything going for it.

Better transport links than Greystones.

Better amenity/infrastructure potential. The main street and side streets are a bit dreary now, with things like vaping and fix your mobile phone shops, but it would not take much to transform it. Greystones is just one main st full of coffee shops.

The seafront is far nicer and more functional than Greystones - it is a feature in Bray whereas Greystones feels like it has its back to the sea.

The area around that Ellerslie villas house is really nice, leafy and mature, short walk to the seafront, bars, restaurants and the dart.

Sure there are some less attractive parts with some dodgier people but they are no closer than the same issue in the premium southside locations - eg Killiney/Ballybrack.

It would not take many well heeled Dubliners to move in, bringing more disposable income that will see the vaping shops etc give way to something more upmarket, and transform Bray into something really quite special.

If you look at the development of south Dublin/North Wicklow over the past 50 years the glaring anomaly is Bray. I cannot see it lasting too much longer!

Bray will eventually be consumed into south Dublin.

cnocbui

Sweet.Science wrote: »

It appears lockdown is continuing until May meaning house sales will be on hold until then . No viewings no surveys not sure how sales will be able to go through

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.

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.

PropQueries

MacronvFrugals wrote: »

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

State’s biggest landlord increased revenue by 20% last 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

I think the opposition should try get details on how many units in the build-to-rent sector are partially or fully funded through HAP or long-term lease agreements.

They could just ask the department to give the percentage without breaking down which BTR crowd benefits from this state largesse without divulging "secret" or "commercially" sensitive information.

Back in 2018: "11% of I-RES's total portfolio of rental properties of 2,678" were HAP recipients according to RTE. That figure probably excludes other supports e.g. long-term lease agreements or whatever thing existed back then etc.

Updated figures would be very interesting and would most likely show how much these reits etc. rely on the state's privatised social housing model for the majority of their profits IMO

Link to 2018 RTE article here: https://www.rte.ie/news/2018/0809/983942-housing-social-tenancies/

PropQueries

schmittel wrote: »

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.

But isn't that more due to because they thought the downturn would be a year or two max and then they could get back on their feet?

Once the downturn got into year 3, 4, 5 etc. and the private sector worker began to realise that the bankers, the civil servants and the public sector workers had all been bailed out and that he's been left holding the can, I wouldn't blame him for shutting off his payments to the banks etc. IMO

hometruths

PropQueries wrote: »

But isn't that more due to because they thought the downturn would be a year or two max and then they could get back on their feet?

Once the downturn got into year 3, 4, 5 etc. and the private sector worker began to realise that the bankers, the civil servants and the public sector workers had all been bailed out and that he's been left holding the can, I wouldn't blame him for shutting off his payments to the banks etc. IMO

The more it became clear that public opinion and thus govt policy was that it was the banks' fault that people were in mortgage arrears, the more it became clear that there was little prospect of losing your PPR in a hurry if you were in arrears.

As this went on, for many who were deep in negative equity, and at the time believed there was no prospect of ever getting into positive equity, the rational decision was to stop paying your mortgage, irrespective of whether they could afford it or not.

tigger123

PropQueries wrote: »

But isn't that more due to because they thought the downturn would be a year or two max and then they could get back on their feet?

Once the downturn got into year 3, 4, 5 etc. and the private sector worker began to realise that the bankers, the civil servants and the public sector workers had all been bailed out and that he's been left holding the can, I wouldn't blame him for shutting off his payments to the banks etc. IMO

How were the public and civil service bailed out? Was it through those civil and public service pay cuts?

cnocbui

tigger123 wrote: »

How were the public and civil service bailed out? Was it through those civil and public service pay cuts?

They were bailed out by not being let go - insulated from unemployment such as befell many in the private sector.

PropQueries

tigger123 wrote: »

How were the public and civil service bailed out? Was it through those civil and public service pay cuts?

The vast majority of our current debt is due to keeping civil servant and public sector salaries and pensions at near enough boom time levels.

The state has already got back a significant portion of the money used to bail out the banks. The PRSI fund was in the black through most (maybe all?) of the downturn so the social welfare payments weren't the cause of our current debt problem either.

PropQueries

schmittel wrote: »

The more it became clear that public opinion and thus govt policy was that it was the banks' fault that people were in mortgage arrears, the more it became clear that there was little prospect of losing your PPR in a hurry if you were in arrears.

As this went on, for many who were deep in negative equity, and at the time believed there was no prospect of ever getting into positive equity, the rational decision was to stop paying your mortgage, irrespective of whether they could afford it or not.

I don't think many people who could afford to pay their mortgage on their home refused to pay if they could afford it.

Receiving letters and calls every second week would drive any person crazy and the end game is that you're more than likely to lose your house anyway.

So, I don't think the percentage of these "strategic defaulters" is as large as some make out.

I think it's just a way for the funds to get the public onside regarding repossessions and extract the maximum value from the mortgages they bought for a pittance over the past several years.

cnocbui

I wonder if thes funds have a 'cunning plan' to take the Irish government to court in the US and get a judgement forcing them to change the laws to allow reposessions?

I'm thinking of that lovely guy, Singer, who bought up Argentina's defaulted soverign debt for cents in the dollar and then took the Argentinian government to court in the US and got a judgement against a formerly sovereign country.

Gradius

Banks are in trouble because massive loans were given out on massive mortgages on massively overpriced housing encouraged massively by governments and banks. And that means this entire country is in trouble.

Nothing has been done to rectify it since the recession even though many called out the fact that the "recovery" was anything but an actual recovery. The can has been kicked down the road and now the end of that road is rapidly approaching.

Forgetting complexity, a simple thrust of "calling it quits, starting over" should certainly be considered.

It's better to start from bottom and have an upward trajectory rather than this quagmire of perpetual descent.