Thursday, October 22, 2009

Quotes of the Week

"It is now virtually impossible to let a Georgian on one of the city squares. Had the planners been in touch with what is happening on the ground they may have acceded to the wishes of the SCS. To refuse permission to a reputable society brings the planning process into disrepute. The verdict may well lead to another empty Georgian." (Irish Times Property Supplement)

Monday, September 21, 2009

"Given that most agents say prices are now back to 2001/2002 levels she may still be being optimistic, although the house does feature electronic gates." (Sunday Independent)

"There are a number of deficiencies," such as the absence of precise mechanisms on the part of the developer to complete the development, to verify the quality of construction, to address snagging and completion issues and to furnish to the owners and the management company a final certificate of completion and compliance, together with all estate documentation for the overall development." Siobhan O’Dwyer, Society of Chartered Surveyors.

Thursday, September 17, 2009

Quotes of the Week

The Irish property market was so obscenely bloated that public sentiment may only allow a snail-like recovery of value that could take many years. (Harry McGee, The Irish Times)

Homes should be seen as part of a community and not just as stand-alone properties or assets, according to Nic Retsinas, a director at the centre for housing studies at Harvard University.

Thursday, September 10, 2009

Quotes of the Week

"Taxing the use and development of all land to the point of unviability appears to be a headline grabbing, political manoeuvre to make the NAMA legislation more palatable." IAVI President Aine Myler

"Why has Ireland chosen to adopt the position that the price paid for houses is private information, when this information is vital for the common good in the effective operation of the property market in both buoyant and bad times?" IAVI President Aine Myler

"The property markets are collapsing around the globe, so we are joining the fast pace of the 21st century. Players can build structures that increase their property values, such as schools or eco-friendly wind farms, or they can sabotage opponents by building sewage plants or prisons on the competition’s property," a spokesperson for Monopoly's Waterford-based manufacturer, Hasbro.

‘‘The only solace Nama gives developers is more time to repay loans." CIF director general Tom Parlon.

"Never has it been more important for all property valuations to be carried out in strict compliance with the highest professional standards." David Freeman of Knight Frank Dublin

"The head of Hooke & MacDonald 18-months ago on television went on record to say that the industry could turn-off the supply tap like the flick of a switch, yet the industry is still overbuilding in terms of the completion rate. It defies logic that persons employed in the auctioneering profession can boast about their longevity in an industry where they have persistently been upbeat on prices and recommending that "now is a good time to buy" (their motto and permanent creed), whilst simultaneously complain about vendor reality when it comes to price. They are of course, an unregulated profession where the dictum "Caveat Emptor" resonates. To that end prospective buyers beware! A 2-bed in Dundrum for 339k, wait until its 280k, then 240k etc. Cigarettes come with a 'health warning', these guys should come with a different warning - listening to them and acting upon their advice could seriously damage your wealth!" Derek Brawn, author of Ireland's House Party.

"Will it operate for the industry, because whatever about the valuations and the transfers, if it does not work for the industry, if you don’t have a returning functioning market it will cost the taxpayer an awful lot more than it costs him today." Michael O’Flynn

Monday, May 25, 2009

Quotes of the Week

"The bottom line is that the Irish property market is heavily entrenched in a deflation spiral and, given the myriad of factors that have led to its creation, it is unlikely to recover any time soon." (Alan McQuaid, Bloxham Stockbrokers, in The Irish Times)

"One has to be critical of interference with the property market generally in normal circumstances, but these are not normal circumstances. There are 60,000 houses around the country with for-sale signs outside them." (George Lee in relation to his suggestion that stamp duty be reduced to 2%, in The Irish Times)

"From now on, there will have to be consistency between a local authority’s development plan and the National Spatial Strategy, regional planning guidelines and ministerial directives, such as those I have issued to a number of councils." (Minister John Gormley, in The Irish Times)

"We have a price in mind which is considerably less than the asking price, but we’re not going to let someone make a silk purse out of a sow’s ear at our expense. We’ll play it cool and see who really wants our money, it’s not a lot, but it’s a sum we can stand over. And we have trends on our side." (House hunter, Don Morgan, The Irish Times)

"This is the fastest rate of decline in national prices that we have seen to date since the index started in 1996. The particularly dramatic reduction in prices for First Time Buyers reflects their reluctance to buy in a market that is still declining and where unsold properties are being reduced further." (Niall O’Grady, General Manager Business Strategy, permanent tsb)

"All borrowers will be required to meet their full legal obligations. There will be a hardening of the approach to these borrowers – taxpayers’ money is at stake and the agency [NAMA] will be expected to protect it in a commercial way and with an independent remit.” (Minister Brian Lenihan)

The Government has stated that Nama will have a clear and strong mandate to ensure that Irish taxpayers do not ultimately end up paying for the over-exuberant lending practices of the past decade. Failure to face up, recognise and deal with the problems in our banking system is simply too costly to contemplate for this and future generations of Irish people.” (Brendan McDonagh, interim head of NAMA)

"The last thing AIB or Bank of Ireland want to see is the entire portfolio of some bankrupt property developer dumped on the market by a liquidator. Not only would the banks have to write off their losses on that particular developer, they would have to write down all the other loans extended to all the other developers to reflect the value of the prices being achieved by the liquidator... If it takes the precipitous collapse of Paddy Kelly to force everybody to jump into the unknown and get on with cleaning up the mess, then it is to be welcomed." (John McManus, The Irish Times)

"AT long last the Auctioneers Bill hit the Senate on Thursday. The cowboys are being reined in. The same cowboys are believed to have beaten a path of protest to the Minister for Finance's door demanding some of the Nama valuation action. Apparently they are fuming that The Irish Times published a report suggesting that our oh-so-honest (but much-maligned) estate agents will not be allowed to give valuations for Nama.Why should they?

These are the guys who deceived the nation with phoney guide prices, who seduced young buyers into auction rooms by quoting artificially low figures in the newspapers. Their record on valuations is abysmal. How could the Government put any trust in their wild guesses at the value of a toxic asset? They were always way off the mark with the non-toxic type. These are the clowns whom an RTE Prime Time programme revealed were indulging in malpractices , including fake bids at auctions and quietly supplying vendors with knowledge of buyers' financial strength. They obtained the information through their own mortgage brokers." (Senator Shane Ross, Sunday Independent.)

"There are about half a dozen developers in the country, mainly in the Dublin region but not restricted to the Dublin region, who really lost the run of themselves. They got us into all kinds of problems over the last five years or so. Looking at projects properly -- realising we are a little country of four million people and we are not the greatest nation in Europe the way some of the developers had convinced themselves we were.'' (Owen O'Callaghan)

Thursday, May 21, 2009

Quotes of the Week

"We are clearly open for business and we are working with our customers, both new and existing, to meet their mortgage needs. We are approving 4 out of 5 applications and our branches are reporting an increase in the number of enquiries from both first time buyers and existing home owners." (Bank of Ireland statement)

"Enabling households to realise their home ownership ambitions is a fundamental part of the day-to-day business of banking. We view the additional 30% capacity for lending to first time buyers in 2009, which is being provided under the terms of the recapitalisation scheme for Bank of Ireland and Allied Irish Bank, as a very significant starting point in the normalisation of the credit flow for house purchase. It is important that first time buyers, in good financial standing, have a line of credit open to them to allow them to make informed decisions in engaging again with the Irish housing market." (Mr. Michael Finneran, T.D., Minister for Housing and Local Services at the C.E.I.’S conference)

"The construction industry has a lot to answer for. Their over-production of property and miscalculation of the market has caused this depression. There is an overhang of 90,000 residential units for sale. We cannot sustain construction for the sake of building jobs. " (Ivan Yates, Irish Examiner)

"The state support of housing benefit is out of control. Mortgage and rental subsidy schemes need to be revisited in the context of the collapse of the housing market. Immigrant accommodation is costing us €52m a year. Why should the state overpay for negative equity loans and unadjusted rents? It is only to prop up bad banks and failed property investors. " (Ivan Yates, Irish Examiner)

"The [positive economic] trends identified in this paper are all positive for Ireland, but the property market here will take a while to feel the benefit. There is still some pain to come and more realism is needed in some quarters." (Margaret Fleming, Director, Investment in Jones Lang LaSalle)

Wednesday, May 13, 2009

Quotes of the Week

"Cheap accommodation, like cheap energy, is a competitive plus for any economy. In fact, if we look at successful European economies, cheap accommodation relative to wages is the basis of a dynamic economy." (David McWilliams, Irish Independent)

"In other words, to make it worth your while buying the house, the price would need to more than half from where it is now. We have to assume that the days of large capital gains on houses are over. Therefore, the average Irish house in these estates is likely to fall by anywhere between 50pc and 60pc in the next few years. And even that is assuming that prices don't undershoot on the downside the way they overshot on the upside." (David McWilliams, Irish Independent)

"Society empowers local councillors through the development plan process to zone land for development purposes. A system under which individual developers, in association with private banking, have reaped substantial benefit. Should their property rights still have primacy over society’s property rights as some pundits argue? The time has come to materially change the way development land is valued. The phrase the “common good”, as per the Constitution, should be given its true meaning and not the common good of property developers." (John Malone, Irish Times)

"It is in everyone’s interest to get the property market moving again. At its peak, the investment market was worth €3bn – this year we will be lucky to reach €300m. That means a drop of €250m in stamp duty revenue alone. And I have not even begun to think about the impact of declining property values on personal pension funds." (Phil Hogan TD, Fine Gael, address IPAV conference)

"People thought that no matter what happened with the property, if it came to the crunch, they could always dispose of it and there would always be a purchaser. The boom facilitated access to the property market for many new investors and now the impact of ever-decreasing capital values is hitting property owners hard across all sectors. A lot of owner managers entered the market on the back of the ongoing rising tide and now find themselves in significant personal and business debt, with lease agreements made in the past three years placing a huge burden on them. It used to be that properties ran themselves and there was always an occupier to fit the type of unit you had. This has totally changed and the need for companies to manage their properties effectively is now more important than ever." (Michael Hogan, managing director of Capital Assets)

Monday, May 11, 2009

Quotes of the Week

"Any move by the Government now to try to discredit Irish auctioneers and estate agents as in some way being to blame for inflated prices, or incompetent to value sites and buildings is utterly unjust and unfair ... It would be highly unethical and improper of the Government to engage entirely foreign expertise whose knowledge of the Irish market is limited." (John Shaw, IPAV President)

"The days of bad planning have to be over at this stage." (Environment Minister, John Gormley)

"We removed the claw back for many of the units because we felt with some of the one-beds there was very little difference between the affordable homes price and the actual market value. We thought it would be unfair to impose restrictions on such buyers. (Paul Maloney, chief executive of the DDDA.)

"It is true that the speed of the depreciation has taken some of our members by surprise, but anecdotal evidence suggests that there is a strong belief that prices have reached, or are very close to the bottom. If there is further depreciation, it is likely to result in an over-correction, which would quickly cause prices to rebound to current values." (Simon Ensor of the IAVI National Council's residential panel)

Thursday, May 7, 2009

Quotes of the Week

"As we can all see, Dublin, Cork, Galway and other places have developed out of control. As our city centre populations decline, the suburbs sprawl. Even now we have the fastest growing population in Europe and space is running out in our cities. The fundamental problem is that we have been building in the wrong way -- at too low a density and with a lack of concern for the required infrastructure/facilities -- with the shortsighted view that it is the commodity of the house that matters, to the detriment of developing sustainable new communities... Many of our suburban housing estates are big cul-de-sacs, leading nowhere and laid out to suit cars". Most of suburbia is single tenure and single use, with a common household size. It can, indeed be a "place of isolation, being boring, monocultural, and lacking a sense of community. To undo this legacy will be nigh on impossible, although the upcoming rise in energy and transport costs may be a suitable catalyst for serious change when the economy allows," he concludes. The stakes are massive, our responsibilities are huge. Will we be known as the generation that squandered the opportunities or the one that created an enlarged cohesive and fair society for our children and theirs?" (Architect Sean Harrington comments in a new RIAI publication entitled The New Housing 2)

"But blaming estate agents is utterly pointless. They are sales people. They sell property. Some are very knowledgeable on their subject and are extremely good negotiators and others are useless at their job. But, at the end of the day, their job is just to sell property. They are not paid to worry about whether or not the buyers will eventually sell on the property again at a profit or a loss. In the same way as estate agents were not responsible (nor congratulated) for the huge profits people made on property investments during the “good old days” they can hardly be blamed now for “putting people into negative equity”."(Isobel Morton in The Irish Times reacting to Derek Brawn's performance on the Late Late Show)

"The signs are that buyers are prepared to move where they perceive real value. The next step for the market will be to get transparency on prices. With legislation currently being pushed through to activate the National Property Services Regulatory Authority, auctioneers can only hope that one of its first moves will be to demand that property prices to be recorded and put into the public domain." (Orna Mulcahy, The Irish Times)

"When we made our offer, we thought the agent was bluffing: there couldn’t be another offer, surely. Who the hell would have money in this day and age? There was indeed another offer, pure and simple. We were just too mistrusting and nervous as hell to realise that, so didn’t get it. Hardball game over. We also made the rookie mistake of having our heads filled to the brim with tales of tricky estate agents looking to squeeze a few extra shekels out of gullible buyers, regardless of inconveniences like telling the truth. You end up parsing each phrase with more care than a diplomat in the Middle East. Well, that one we misread. Estate agents are honest. Damn." (Don Morgan, The Irish Times)

“Current negotiations fall into two categories in our offices in Blessing ton and Baltinglas, offers well below reserve on properties that are on the market for some time and good offers for property that are not yet on the market but identified buyers have an opportunity to buy”. (Simon Murphy of Murphy Real Estate Alliance in Blessington and Baltinglass)

Monday, May 4, 2009

"The banks are being bailed out and they are putting the boot in right, left and centre, destroying businesses. They're not lending and they're getting away with telling lies. The sadness is that our lovely country is being destroyed. And we all have a responsibility for it. We over-expanded; fully accepted. But a lot of people gained from it, people selling land, the Revenue in particular, the Government got a huge boost in revenue from people buying homes. And the sad thing for me is that Anglo Irish has been blamed for so much. Seanie FitzPatrick, David Drumm, they're the best in town. They made mistakes, of course. But there's been too much blame passed on to them." (Paddy Kelly)

"What's wrong with development? Are we so confused in our thinking that we misunderstand what development is? The nicest places in the world have come about through development....Were we wrong to house Compaq in Ireland? But we're being told we were wrong. Were we wrong to house O2? We're being told we were wrong. We're awful. We're developers. Were we wrong to build Smithfield and Clarion Quay? As of now, did we make a mistake to do any of that? As of now, that's what's being printed -- every day of the week." (Paddy Kelly)

"We've worked our nuts off to make thing work and to have performing loans. We're going to be screwed to balance against the developers who messed up. They're hijacking the income from the assets to pay for the revenue they have to pay out on the bond [that the government will use to fund the acquisition of Nama's loans]. Are guys supposed to work out these problems for nothing? Because once something goes into Nama you're effectively no longer involved. The income is ringfenced so they'll take it away and cripple you. This thing is ferocious." (Anonymous senior property development executive)

Friday, May 1, 2009

Quotes of the Week

"They don’t understand why you have to put the assets into Nama when Nama is likely to leave the loans with the banks and manage them like a credit committee." (Anonymous accountant, quoted in the Irish Times, representing anonymous developers who are trying to prevent transfer of their performing assets to NAMA: concerned that the Government would take over commercial properties such as shopping centres, on which loans were being repaid, because they were offered as security for, in some cases, smaller property development loans.)

"When called in to give their professional opinion on a property and its value, agents will make all the right sounds while avoiding saying anything which may later be used against them. In other words, they avoid giving any opinion on the possible sale price until they have first established precisely what price the vendor expects their property to achieve." (Isabel Morton, The Irish Times)

"Tenants are wise and are bargaining hard for discounts on advertised rent. Invariably they get the reductions, as it’s a renters’ market out there." (Irish Times article)

"As a long term proposition property is still a perfectly good asset class, the dotcom crash didn’t mean people stopped sending emails and despite the property crash living in a house/apartment still remains the most popular choice. The advised view (from our firm at least) is for home buyers to make solid long term location decisions that they can, and for investors to run the numbers to determine their target buying prices rather than looking at the market and trying to model your investment to work within the framework of current asking prices." (Karl Deeter of Irish Mortgage Brokers)

"It will take longer here to clean it up but that doesn’t mean that you can’t do good business during this period." (Swedish estate agent, Agneta Jacobsson, addressing Sherry FitzGerald business breakfast.)

"For years, we have been encouraged to ‘‘invest’’ our money in now-decimated pension funds as tax-allowable deductions. Similarly, we have been encouraged, by a coterie of mortgage brokers, bankers and financial gurus, to buy our own homes. Instead of continuing to contribute to these ‘‘black hole funds’’, maybe we should be allowed to switch this pre-tax income to paying off mortgage debt on our principle private residences. The net cost to the revenue would be nominal, as it is swapping one form of tax-allowable deduction for another. Messrs Cowen and Lenihan should give us something to smile about, and let us tackle negative equity with our incomes." (Cahir O’Higgins, solicitor, Dublin 7 in the Sunday Business Post)

Friday, April 24, 2009

Glenkerrin no longer with Savills

See Glenkerrin's ads for St Edmunds development in Leopardstown no longer mention Savills. Also hear that Savills have parted company with some more key staff, so watch this space.

Thursday, April 23, 2009

Quotes of the Week

"I reject any suggestion that NAMA is a bailout for developers. The agency will acquire loans at an appropriate discount from the face value of the loans held on the banks' balance sheets. Developers whose loans are transferred to NAMA, however, will continue to be liable for the entire face value of their loan obligations. There will be no discount for developers. I suspect Mr McWilliams is living up to his reputation for swimming against the tide, rather than offering any serious analysis." (Minister for Finance, Brian Lenihan)

"Prospective buyers can plan ahead with greater certainty now that the mini-Budget is out of the way. There are more houses with multiple bids on them than before. We have 100 houses under offer at present.The banks are definitely open for business, although the journey from funding to closing is definitely more protracted. Everyone involved -- bankers, solicitors and buyers -- are being much more forensic." (Michael Grehan, Sherry FitzGerald, Irish Independent)

"There have been some sales, but the big problem is getting deals across the line. Plenty of prospective buyers have identified the property they want, driven a tough bargain and want to buy. But we are now finding customers who are distressed about how they are being treated by banks stretching out the loan process continually." (John O'Sullivan, Lisney, Irish Independent)

"There are certainly 'green shoots' showing at a number of housing developments. I'm no longer hearing unending dismal stories about phones not ringing and empty showhouses. Over the last six weeks or so things have improved greatly. It's nothing like it was in the 'good old days' of course, but sales have been steady. Mostly this is first time buyers who recognise that this is the time to buy, and it is unlikely that house prices will drop drastically from here on." (Valerie McGrath, Irish Independent, in an 'article' about Athlumney Wood development in Navan, where she is told "there have been 35 sales over the past few week".)

"The idea of buying a ’starter home’ just for the sake of it so you’d have the equity to move on in a few years is wrong, you should buy so that you can live and settle down in the place you actually want to live in. The sharp falls we are seeing now mean that many people will be able to do this in the future, unfortunately there is a lost generation who won’t." (Karl Deeter, Irish Mortgage Brokers)

"The banking climate for private investors could hardly be worse. For starters, lenders are looking for 20 per cent deposits and, even if they run with the investor, they are charging premiums of at least 1.25 to 1.75 per cent over the home loan rates. To add to the difficulties, many investors continue to be stung by a reluctance of some lenders to pass on the value of interest rate cuts on existing mortgages." (Jack Fagan, The Irish Times)

"Where was the Honest Joe auctioneer when the market began going south, and the loud noises in the business kept proclaiming it was still buoyant, dragging gullible first-time buyers into the web? Auctioneers didn't create the problem, but by God many of them fed off it like vultures, and if some were uncomfortable, they kept their own counsel. They can hardly now claim to be scapegoats. Sorry, Sarah, no concession to feminine fashion in the bunker. Get sized up for the unisex pair." (Michael Clifford in the Sunday Tribune)

MFO website live

I see MFO (McGinley, Farrelly & O'Connor), the new Ranelagh-based agency whose boards seem to be popping up everywhere, have got their website fully up and running, including their own Property Review blog-type section (which I hope they maintain).

I just still wonder about the name. MF is one thing. FO is another. Put them together and you're surely asking for trouble! But maybe when you combine them, the rude associations are eradicated. It certainly doesn't seem to have caused this team any harm: we have 9 listings for them in the resale database already and yet they haven't even gone after that market as much as lettings et cetera and are only in business a few wet months.

What a time to start a new agency, but they appear to be made of the right stuff to manage.

One swallow makes a summer in newspaper land

I see in the Irish Times today someone asks about agents not providing an advertised price:

"Q What’s the story with “price on application”? I thought it was a country thing but in looking at various property websites I see that it is now being used in Dublin. What’s the point? If the agent thinks it prompts interest, it doesn’t. It’s a turn off .

A Price on application is indeed a silly extra step, because all it takes is a phone call to find out what the asking price is. It’s not as if there is some difficulty in getting the information. For new homes, it’s generally because an agent doesn’t want to broadcast the price drop due to the sensitivities of owners who bought at the top of the market and is also usually an indication that the developer is willing to do a deal.

For second-hand houses it could be the case that the house has been on the market for so long that there have been multiple price drops, with more expected, so the seller feels “price on application” will save on the embarrassment of advertising each of those price drops.

Agents might also feel that if they could get you on the phone even for the minute it takes to tell you the price, they might be able to lure you into a viewing.

Whatever the reason, it’s difficult to argue with you that it is pointless and only serves to irritate, not intrigue, prospective buyers."

It is an interesting niche topic for a few property business types, but in fact, when you look at the numbers, we have noted only 15 properties out of nearly 3500 since January in Dublin city without an advertised price, and only 12 out of over 1100 in Co Dublin. So I would not label this a "thing" with the sense of "issue of public concern" or "phenomenon" as the letter writer (never named in these Q&As) does and the paper too by addressing it. The newspapers have a habit of taking a notion about something based on one or two instances and turning that into "information". It's not such a problem with minor issues like POAs but when it comes to pricing and agent behaviour it can be a big problem.

Wednesday, April 15, 2009

Quotes of the Week

"These are no longer sufficiently attractive to purchasers who could otherwise buy on the open market without restrictions. In these difficult times, the Docklands Authority is making every effort to ensure that qualified applicants can take advantage of our schemes and so have adjusted the conditions accordingly." (Paul Moloney, Dublin Docklands Development Authority in The Irish Times regarding removal of selling restrictions from affordable homes under the DDDA's control)

"I SEE that Government sources have said that Nama, the National Asset Management Agency, is unlikely to employ any Irish estate agencies for the purposes of valuing the properties it acquires. What an indictment of Irish auctioneers. Is the Government really saying there is not one in the country who can be trusted to give a fair and reasonable value on a property?" (Sarah Carey, The Irish Times)

"If you were selling your house tomorrow would you give the sale to an auctioneer who might advise potential customers not to buy at the asking price? Of course not. You’d sue him if you found out he told buyers to hang on until next year. He might advise you to wait a couple of years, but if you gotta sell, you gotta sell. Within all bounds of decency – but using all his skill as a negotiator and salesman – you are paying the auctioneer to get the best price." (Sarah Carey, The Irish Times)

"Dublin City Council handles 4,000 applications a year, many of which are controversial. Will the members now require an inquiry into every difficult decision to be made? There is already an independent process in place through An Bord Pleanála to deal with appeals against decisions of the city council and it demonstrates due diligence and fair process in action." (Dublin city manager John Tierney, in a letter to Fine Gael councillor Paddy McCartan)

Tuesday, April 14, 2009

NAMA acronyms

"Nothing Answered. Much Asked." (from a friend of mine) is my favourite.

Other suggestions:

Need a massive audit
Never actually making anything
Not another mad act

Not about money anyway
National Association for Mucking About

Wednesday, April 8, 2009

Quotes of the Week

Most of them will be wiped out. I think you’ll be finding a rush of Ryanair tickets for the developers to places they’ll be hard to find in. Otherwise, the wife and chisellers will be out on the street.” (Anonymous property developer, speaking to Frank McDonald, The Irish Times).

"One way or the other, the game is up for developers and bankers who lost the run of themselves during the boom. All we now need is a full and frank acknowledgement from the Government that it artificially inflated the bubble and thus made the bust more painful for everyone." (Frank McDonald, The Irish Times)

"To save the next generation of questioning managers, we need to get to the bottom of what really happened to those who sounded warnings in the past. Launching a distressed assets "bad bank" agency is no excuse to sweep this issue under the carpet." (Gerald Flynn, Align Management Solutions in The Irish Times)

"It's as volatile as this: if just one guy on your road is being forced to sell and he slashes his price into the dirt, there goes the neighbourhood." (Paul O'Connor of ... NOT. I did not say that or anything that could even be paraphrased by the 10th person in a game of Chinese Whispers as that. Grrrr: so much for getting good quality, useful information about the market out there! What I am quoted as saying is simply not true. One swallow does not a summer make, and one property transaction on a street does not determine the market. It might influence it for a time, depress it in the case of a forced sale, but the circumstances of other sellers on the street may well negate that effect quite quickly, and the overall appeal of the street will certainly be far more powerful in terms of buyers' ultimate positions in negotiations.)

"The relief will now be targeted on those who bought their homes when prices were at their peak. It will also support those who now wish to move, improve or buy for the first time. As house prices fall, the provision of mortgage interest relief will be kept under review with a view to eventual abolition." (Finance Minister Brian Lenihan, TD)

"In times of fiscal shortcomings we fail to understand why the government introduces tax measures that act as a disincentive to activating property transactions. We are disappointed that the government is not taking this opportunity to stimulate the property market and rebuild the strong revenue income from property. The new stamp duty trade-in scheme is totally confusing and will do nothing virtually to help the market and has no immediate effect on generating revenue." (Knight Frank statement reacting to budget)

"The reason that some developers aren't interested in the trade-in is because of the stamp duty implications. They don't want to pay stamp duty on a property they aren't interested in. Delaying the payment of stamp duty will have little impact." (Carolyn Coyle, Savills)

"It's a sop to the industry, but it won't compensate for the hugely negative signals that the short-sighted Budget has given out." (Fintan McNamara, IPAV)

"There is no major benefit to the scheme but I could see how it would work in some cases. A first-time buyers' grant for one year would have been a better alternative. It would have reduced the stock and stabilised the housing market." (Hubert Fitzpatrick, Irish Home Builders Association)

"Landlords are increasingly being pragmatic about this problem and acknowledge that, as leases are long term relationships, they need to protect their investments and their rent roll. They are prepared to consider rent reductions. This is happening right across the board." (Jack Devlin of GVA Donal O Buachalla)

"That is the way things are evolving. I can see more and more people moving to this American model where shorter leases are offered and the landlord gets a percentage of the turnover instead of a rent. That is already happening in retail malls, like Kildare and Banbridge, and the same thing will happen in shopping centres." (Aidan Grimes of Bannon Commercial)

"We recognise the importance of tenant relationships in the schemes we manage and, in particular, the importance of keeping strong retailers and attractive retail offers trading. That said, we also must acknowledge the major financial obligations of the landlords and developers of these shopping schemes... In all cases we have asked tenants to provide full and detailed financial information to back up their position, as opposed to dealing with the blanket reduction requests that have been made by certain retail chains and groups which take no account of the individual trading performance of stores and locations." (Larry Brennan of Savills, The Irish Times)

"Stockbrokers didn’t see the obvious – for one simple reason. Stockbrokers are about as likely to tell you that the system is in big trouble as racing tipsters are to tell you that gambling on horses is a mug’s game. They both have to believe that the next big win is just around the corner. The truth that their game is up is as inconceivable to them as it should be evident to the rest of us." (Fintan O'Toole, Irish Times)

"Having made the fatal mistake of boosting the property market on the upside to satisfy their own political ends, we now are faced with the equally ‘appalling vista’ of buying bad assets too early with real cash and compounding the problem. We are about to unveil the most expensive ‘cash for trash’ scheme the world has ever seen, and no one is saying anything about it. The government is asking us to trust it on the price of a piece of land or a house. Why should we trust it? Nothing that the government has done over the past ten months would suggest that it could call the bottom of the market, so the potential for a monumental mistake is enormous." (David McWilliams, Sunday Business Post)

"There's definitely a pick-up, there is no doubt about that. Last week was the busiest week we had in the last year. We sold more than 50 apartments at the Waterways in the last week, which is all very positive. It's been a long time since we had that volume of sales over a five-day period." (Ronan O'Driscoll, Savills in the Sunday Independent)

Thursday, April 2, 2009

Quotes of the Week

"The stock of available second-hand properties has tightened noticeably, particularly in Dublin while the appetite for property as evidenced by viewing levels has increased. That said, consumer confidence levels remain low with a large proportion of potential purchasers reluctant to commit in the short term due to uncertainty in their own personal circumstances or concerns regarding the future market performance." (Marian Finnegan, Sherry FitzGerald)

"As such the emerging evidence appears to suggest that the property market is bottoming out and while we do not anticipate this will result in an immediate halt to price reductions it is likely that with hindsight this current period will be viewed as a period of over correction in the housing market." (Marian Finnegan, Sherry FitzGerald)

"It’s been extremely unfair of them to abandon the property market. Stamp duty has been a cash cow for the Government for years and they milked it and now it’s time to give property a break." (Conor Gallagher, Douglas Newman Good)

"They are not ready yet to bring back RPT (residential property tax). It is still being formulated. However, when they do introduce it they will have to offer a trade-off by reducing stamp duty." (Simon Ensor, Sherry FitzGerald)

"Would it [a stamp-duty holiday] kick-start the market? I’m not sure. Taking 7 per cent off the upper end, and 4 per cent off the middle range isn’t that enticing, with prices dropping as they are. Prudent negotiations will get you that discount anyway.” (Simon Ensor, Sherry FitzGerald)

"I think property has been marginalised in terms of revenue as a tax-take and I don’t think it’s relevant to this Budget." [It looks as if the market has corrected" itself pricewise and any "artificial remedies" will only boost it for a temporary period.] The main problem is the banking situation but that is not going to be resolved in this Budget. I believe the market will get going itself eventually of its own volition. The Government should sort out our banking issues which would solve problems in the property market and a few other things besides." (Des O'Malley jnr, Sherry FitzGerald O'Malley)

"It is important to have reached the bottom of the market before introducing any stimuli otherwise any positive benefit will be negligible. Once sales start to happen again the market will be indicating that is has reached a level where it is once again happy to do business." (John Cumisky, Cumisky Real Estate Alliance)

"They [the new breed of buyers making the most of a buyer's market] nearly have me on Zanex. The dread of my life at the moment is those BER certificates. They expect me to have one in my top pocket. It’s a head wrecker as they are standing in a period house with no insulation, single glazed windows and open fireplaces so the BER certificate is heading for an ‘F’ grade anyway." (Joe Kelly, Property Team JB Kelly)

"They knock on walls, stick screwdrivers through wallpapered walls and even remove skirting boards looking for damp. It’s a nightmare. And parents of first-time buyers are the worst. They come along to give their children advice but … one parent told me that the house was sinking and started rolling coins along the floor trying to prove that the property had subsided. Of course, once you see the clipboard, you know you’re in trouble and will be there for hours. They generally have a list of prepared questions and you can see that they have gone through it all before in at least 20 other houses. And some bring a compass to confirm the orientation. I’ve often thought that, if I could pick up a house and move it, I’d be a wealthy man!" (John Newcombe, Newcombe Estates)

"The number of times I am asked: ‘Have they gone bust or are they just divorcing?’ They then ask: ‘What was the price?’ Followed by: ‘What’s the price now?’ . Followed by: ‘And when will you be reducing the price again?’ They know their way around these days; they have all watched ‘Duncan’, and go around sucking their teeth and knocking on walls and tapping things. But, as Finnegan says: “We’re not complaining. It’s better to have know-alls viewing properties than no one at all." (Iain Finnegan, Finnegan Menton)

"Anecdotal information from our members would suggest that the level of investors is still quite strong which reaffirms that there is a strong mentality amongst people to invest in property but they are currently slow to move on this instinct due to the negative sentiment that still exists in the market. Introducing a property market stimulus would help bring stability, boost confidence and send a strong message that property remains a good long term investment. Owner-occupiers and investors alike are looking for signs of spring. Getting things moving again benefits all groups, not least the Government’s tax takings." (Paul Grimes, Chairman of Real Estate Alliance.)

"Our consultative group have recommended that if the government are serious about their green agenda, they should address this issue by giving buyers of A-rated homes a 10% grant towards buying." (Eimer O’Keeffe. CEO of Real Estate Alliance)

"Cash has dried up. Banks are not lending despite broadcasting ads saying they are. It’s difficult to get any money at the moment." (Tom Parlon, CIF)

"AIB has not changed its lending criteria. Each application is evaluated on its own merits with capacity to repay a key consideration." (AIB spokeperson)

"We call on the government to urgently find a mechanism to take account of the toxic assets of banks. Until the banking sector comes forward and declares its hand and honestly sets out those of its debts that are recoverable and those that are not, the economy will remain in a stranglehold. Without the details of the extent of these bad debts, funding from international lenders is at a standstill, stopping the flow of finance into the county and a vast array of lending to all parts of our economy, including small, medium and large businesses and the vital first time homebuyers' market. This stagnation is unacceptable; until the banks’ loan books are written down it is unlikely that we can move on from this phase." (Edward Carey, President of the IAVI)

"There has been a significant shift towards letting rather than sales activity, particularly in the latter half of 2008 and the year to date. We estimate that almost 90% of activity is now leasing rather than sales. Leasing activity took over as the dominant source of activity in 2008 and this is also expected to remain the trend for the rest of 2009 and into 2010." (Gavin Butler, Director Industrial Division, Savills)

"Mortgage holders on a fixed-rate mortgage have had to bear all these extra costs, cuts and charges too; yet their monthly mortgage bill has not reduced at all. One constituent told me his bank is charging him €14,000 to switch from his 12-year fixed-rate mortgage. It should be possible for the banks to offer a once-off penalty-free switch to existing customers. No-one is asking for a free ride, just a bit of fair play." (Roisin Shorthall, Labour spokesperson)

"The level of business has fallen away as the economy contracted, so the measures [layoffs] are simply a reflection of the current economic climate. We would hope that, by taking this action and taking a reduction in our salaries, it would reduce the need for any further action." (Angus Potterton, Savills)

Tuesday, March 24, 2009