Irish Property Market chat II - *read mod note post #1 before posting*

QE creates asset inflation but not inflation in the wider economy as is evident of years of QE. It is the governments fiscal spending that generates the inflation as the cash gets out to the wider economy. And let’s not forget that governments want to see inflation and this is why they are stimulating the economy with their fiscal spending.

if rates rise to fight inflation then the market value of the debt will decrease which means the government could buy back at a large discount and reduce the nominal amount of the debt.

Good points well made. As a counterpoint, have you considered:

1. ah shur be grand.
2. let’s not rock the boat.
3. any plans for the Christmas?

I'd suggest 15% of unspent savings distributed to all staff as a bonus, everyone getting the same, and a bonus for employees dobbing in emptying the bucket behaviour to an outside stand alone office with jail terms for breaking the dobbers annonymity and revealing them to their parent org. Oviously repercussions for the emptyers.

That said, I doubt that phenomenon is behind the buying spree of existing housing stock, the scale is too large. Sheer laziness is more likely.

Inept or corrupt DCC officials and politicians who have a say in this policy? Both in my view.

As with 08, the big loser once again is the taxpayer as this is where our public funds are ending up - why is it so difficult to reform taxes and why do we need to introduce new taxes? Because public spending is high so taxpayers are told we need to introduce something new to replace something cut. It is a con and the middle classes are being treated like cash cows for the cash their labour raises. You only have to follow the money on these things to see why it is being implemented as a policy; but it is not for the good of society.

From the attachment above, there is a list of corporate entities who are profiting from the DCC long-term leases, set out below. I think it would be quite easy to link persons connected with the below entities to those who have a hand in creating and implementing the long-term social housing lease policy.

Katie loves milking government plebs for money... cant blame her.

Even slime balls Zakay brothers are on it. Were they not done for property fraud in UK?

Send the whole DCC to gulags.

Does the move away from long term leasing reported here only apply to individual landlords. Is it still open season for commercial entities.

I know DCC were looking for a reprieve from the policy. Why work when you can outsource your work at maximum cost and still collect your pay cheque with no questions asked and even go on primetime and proclaim how your saving the country a fortune by ltl over emergency accomodation.

From what I can tell from the free information online as I don't really care enough to pay for company reports, most of those commercial entities are Davy run and connected entities - just going to mention in this context that DCC's Owen Keegan used to work with/for them - it's not that anything obviously illegal is happening but it is a cosy little number that these parties are involved in and won't want to give it up easily;

• Davy Platform ICAV.
• Elm Long Income ICAV.
• Obsidian ICAV.
• Basalt ICAV.
• Herbert Park ICAV.
• ELIREF Blackhall s.a.r.l (Aberdeen are the investor but they are a client of Davy).
• Red Rock 1920BS Ltd (Keith Craddock runs this entity and seems to have at least on one occasion sourced funding via Aberdeen which as mentioned above are a Davy client).

KW PRS = Kennedy Wilson Private Rental Sector.

I saw this in another thread and thought I would post it here. Although its an American polical viewpoint, there is a bit about housing that overlaps with our situation.. The first few minutes especially.

What we see are people in Ireland who would say they are kind, caring, progressive, and want to help those in need especially with housing, turn around at almost every opportunity and curtail, object, stymie, block, and obstruct measures that relieve housing issues.

I like the way the person says, 'They are not living their values'.

I think that is Ireland to a tee. We talk a great game about how great little country we are with great people... but to be honest we are out for ourselves. It is a cod and a myth that we perpetuate and we should be honest about it at least.

Technically neither. You have to give a reason for your observations/ objections. Whether these are valid or not is then decided.

The basic trick with an objection is throw as much sh!the as possible and see what sticks. There is professionals you can pay to do it.

I would not disagree with a lot of what he says. At the end of the day the only solution to the housing crisis is supply.

He make a good point about the furore over the purpose build rental development out near Croke Park. Yes its a build to rent.

As David McWilliams says ''we should not let the perfect prevent the good''. There is no perfect solution supply is the only solution. Just like these that have defended vested interests in stopping housing supply. Last year we had SF and other left politicians prevent a PPP development from going ahead as not enough were social and affordable.

The only solution is build houses and apartments and we should try to stop those that want to prevent peogress

It would not suit his interests that the thousands of small landlords come back to the market as it would cause rents to drop meaningfully. Or what would he say to an accusation that the tax regime disproportionately favours large investors rather than small landlords. This is my problem with his platform if it is given too much prominence; these investors will not accept lower rents if supply increased dramatically. Therefore, they are part of the problem, not the solution if we are told they have a significant part of the solution - they are buying up something like 90% of all new apartments which allows them to dictate the new apartment market - in a functioning market they have a part to play but the few super large entities should not be the dominant players in the market.

The FT had a good opinion piece yesterday on the attractiveness of the property market for investors in developed economies. It's not really surprising and isn't news per se but important to reiterate the correlation between low interest rates on the asset bubble; and how productive cash is ending up in property in a disproportionate manner.

https://www.ft.com/content/99a3cf9b-0ab8-45b9-bbc5-7e88c08f9ea5

The above is obviously just an extract due to the paywall, but as with most FT articles, the value is found in the comments section. The third highest rated comment stands out for me;

I think you are right apart from about SF, but thats another argument.

We are seriously thinking what country will we retire to (used to be what county), because we can see Ireland just going down the toilet over the next few years.

What is interesting is that the majority of the price increases are for existing dwellings (86% of total sales) which rose by 13% whilst the new dwelling rose by 3.3%

On the investment yield point, I suppose the question I would have is that is it not an attractive investment unless it pays for itself? Meaning; small landlords, despite owning the asset, have no appetite to invest where they would need to top up the mortgage in some way? Because to me that would still be an appealing investment considering the equity being built up.

On the legal point, in terms of the rental legislation; one of the things that would be needed to get small players back in the market would be to make it more attractive not just financially but also legally. So that would entail, for example, strict rules around non-payment of rent and evictions (ignoring political will to do this, I feel it is an essential part of getting small landlords back in the market).

On the taxation point, investing in a REIT does not give the REIT investor any ownership rights to any property, they just receive an interest in the REIT. So it is comparing apples and oranges. REITs don't pay tax on their income subject to certain conditions and the investors in REITs are majority based outside of Ireland so we have a situation where essentially we have absentee landlords harvesting productive cash from the pockets of workers (renters) and sucking it out of the country with no tax going to Ireland - at the point the renter transfers the rent out of their own bank account and into the bank account of the REIT's agent that cash is gone out of the country tax free (due to double taxation treaties which would not enable the Irish authorities to tax the money if the investor is taxed on it in their own country). And that is just REITs; which are at least transparent. There are numerous other institutional investor structures which acquire the properties without paying tax. Usually foreign investors invest in non-Irish funds which invest in Irish funds which use some form of underlying vehicle to transact in the property and take income from it - we can't publicly see how these vehicles are structured but throw in some tax structuring magic and again we have rental income not being subject to any sort of tax and moving from renters straight out of the country.