Quotes of the Week 28/03

"I think the rate of price decrease over the first two months of the year is lower than many people might have expected. We are also seeing that some sellers are finally grasping the point that people are interested in buying properties if the prices sought are realistic. This in turn is leading to more market transactions when compared to quarter 4 2007.” - Niall O’Grady, General Manager Marketing, Permanent TSB.

"Despite the recent slowdown in the housing market, Ireland's household balance sheet is in good shape with combined equity at €388bn and outstanding mortgage debt of only 24pc of the value of the housing assets." - Gabriel Bannigan, Head of Halifax.

“This rapid supply response by the building sector is ultimately positive for the housing market but is negative for GDP, knocking 1.3 percentage points off the average growth rate in 2008. The global supply of credit may also be curtailed for a time and, as a result, we now expect a less rapid recovery in 2009 with growth set to pick up to 4%” – Dr. Dan McLaughlin, Chief Economist, Bank of Ireland.

"The gap between the prime city and prime suburban rents [commercial] has widened, if anything, thus making the suburbs more attractive." - Joan Henry, Head of Research, Savills HOK.

"There is no doubt that weaker economic growth will reduce rental growth prospects in many markets, including Ireland, but provided it does not turn into a significant recession a pause in growth is more likely than falling rents. This, in turn, will help support capital values and should stimulate a return to higher levels of investment activity once the current financial uncertainties moderate"- Marie Hunt, CBRE.

“Invariably, the global credit crunch, especially the US situation, has had a knock on effect, which coupled with consumer inflation, is placing continuing pressure onto the property market. We continue to call on the Bank of England to lower interest rates to help prevent the economy slumping and to help bring back a renewed sense of optimism for the consumers” - NAEA president Stewart Lilly commenting on UK house buyer levels falling to a record low.

"It [ECB Rate] corresponds to what we believe is necessary to achieve price stability in the medium-term. If we had reduced interest rates, the moral hazard is that we would have been asking citizens to bail out the banks." - Jean-Claude Trichet, Chief, European Central Bank.

‘‘The impact of Section 110 could be in excess of the price effects and could help drive activity levels significantly below long-term housing market requirements. Such an outcome would be undesirable, in terms of housing price and output stability. It will also impact negatively on property-based tax incentive schemes, which could add to the downturn in activity in the commercial property sector.” – A confidential government report recommends leaving a stamp duty loophole open.

Quotes of the Week 21/03

“The Institute has suspended forty six members for three months from mid March because of their failure to verify compliance and pay subsequent fines imposed. In addition to the suspended members, a further eleven have paid fines for failure to comply before the deadline, averaging €2,100 each.” – IAVI

“We are going through a sharp transition that will see house-building levels temporarily dip beneath our long-term annual requirement. This adjustment will not be painless, but it will help to stabilise a housing market that has been too turbulent in recent years.” - Dr John McCartney, Head of Research, Lisney.

“Halifax calculates that the value of Ireland's private housing stock was an estimated €511 billion in 2007, with housing equity at €395m. The value of the Irish housing stock has increased by 366% (€401 billion) over the last ten years but fell by 4% (€21 billion) in 2007, reflecting a slower housing market.” - Halifax review of the value of Irish housing stock.

“There's a cost to how much you can afford to pay a person to do a day's job. What we saw is when the market was at its peak in 2006 and in 2007, there was a scarcity of labour, and that drove up labour prices. What we want to see is a correction in labour prices to a long-term sustainable price regime whereby not only can we pay people today, but people have a job tomorrow because we're still competitive as an industry and as a country.” – IHBA Chairman John Moran.

“There has already been an increase of land sales of potential sites, with future potential looking to entice developers with lower land costs in what is already appearing to be a turbulent time for the development market. Areas which have typically been developed for logistics or distribution centres will now have potential for high density mixed-use developments, subject to the necessary planning permission” - Keith Begley, Lisney.

“In spite of current economic uncertainty, the industrial market continues to perform well. This is primarily due to a lack of supply of serviced industrial sites close to good transport links. In addition to this, a number of the more established industrial areas of Dublin, particularly those inside the M50, have been re-zoned to facilitate higher land uses such as office, retail and residential.” - Paul Finucane, Colliers Dublin.

"I'm not sure if there is much of a market here for green mortgages but the lenders do need to innovate and this is an option. A potential market could be for people looking to trade up, not first time buyers who just want to get on the ladder, and there needs to be some thought put into creating attractive products rather than just offering coupons.” - Brendan Kelly, financial advisor, IrelandMortgages.com.

Quotes of the Week 14/03

“Our survey of estate agents reveals that 63% believe that there has not been an increase in the amount of transactions, relative to viewings, since the Autumn selling season … On prices, over half of the respondents to our survey believe further declines are likely over the next twelve months.” – Goodbody Stockbrokers.

“"Eventually this [slowdown in building activity] will be reflected in supply towards the end of year, when prices should pick up slightly. It won't be an annus horribilis like last year." - Ronan O'Driscoll, Savills HOK.

“While supply now appears likely to be cut this year, the demographic forces, which underpinned demand growth since the mid 1990s, are set to remain very strong in the years ahead, though the period of demand acceleration is over. Thus the market should find an equilibrium rather than see a protracted fall in prices.” – NCB Stockbrokers.

"Moderate reductions [in new developments] won't work, they have to be serious discounts. At this stage just offering free furniture packages is like re-arranging deck chairs on the Titanic." – Unnamed estate agent, The Irish Times.

"We can see now that there are queues outside some developments launched . . . in the last three or four weeks. Customers are voting with their feet and buying new houses again” - John Moran, chairman of the Irish Home Builders' Association and director of Manor Park Homebuilders.

"Feedback from the housing market over recent months suggests that while viewing levels have been relatively good, there is an apathy towards the actual purchase of the property. Originally, this may have stemmed somewhat from uncertainty around whether there would be changes to the stamp duty regime, but more recently, it is probably due to expectations of future declines in capital values and the fear of committing to the purchase too early." – Dermot O’Leary, economist, Goodbody Stockbrokers.

‘Uncertainty about interest rates remains a key issue for the market. Brokers believe that a more favourable interest rate climate would make a major difference to the market in the coming year. With a little luck this will materialise late in 2008' - Mr. Paul Short, President, IMAF.

‘Planners have made the worst decision possible. They've thrown out the 37-storey tower, which was too high but had some architectural merit, and left us with 18-storey blocks with no merit at all.’ - Dermot Lacey, Labour councillor and former lord mayor speaking on the rejection of Sean Dunne’s Ballsbridge tower.

"The massive investment into roads, predominantly along the M1, N2, M7 and N11 corridors, have contributed to these high levels of demand for the new emerging industrial locations. Our research indicates that demand along the M7 is at an all time high of 36pc of the overall demand for the Dublin area, which is currently only accounting for approximately 22pc of take-up." - Garrett McClean, head of industrial property, CBRE.

“The other significant trend is that the lack of suitable office accommodation in major cities is driving corporate occupiers to actively consider decentralising some or all of their operations to secondary cities and other lower cost, peripheral locations. In the Dublin area in particular, we are witnessing a continued demand for flexible lease terms, which is comparable to the rest of Europe, coupled with an increase in the number of clients seeking additional space in suburban locations in order to reduce their operating costs” - Fionnuala O’Buachalla, director, Jones Lang LaSalle (Ireland).

‘‘The Docklands authority is currently studying the options open to it in relation to the feasibility for further development in the North Lotts area, which it believes has significant potential for providing an enhanced residential, commercial and cultural environment, including family living initiatives underpinned by substantial community gain,” – DDDA.

Quotes of the Week 07/03

"I have heard a lot about this. Basically a lot of developers around the country cannot develop at the moment because they cannot sell the product. A lot of them are under serious financial stress" - Jim Power, economist, Friends First.

“Last weekend over 400 people showed up at the launch of the latest phase of houses at the long running Dalriada development in Knocklyon, Dublin 16, where prices had been dropped by 20 per cent. Not all were buyers, but no less than 45 of the 50 apartments and houses were sold, some to people who had queued on the site overnight to get the first choice” – The Irish Times

“The worst performing country price-wise in 2007 was Ireland, where house prices fell by an estimated 7% – or nearly a tenth in real terms. It had been one of the continent’s price leaders only a short time before. The cutback is having knock-on effects throughout Europe, because Irish buyers used rising housing wealth back home and attractive tax breaks there (via re-mortgaging and pensions) to invest substantially in real estate elsewhere, out of all proportion to the relative size of the country.” – Royal Institute of Chartered Surveyors: European housing Review 2008.

"Even with prices on the open market dropping, the vast majority of people would not be able to service a mortgage and still depend on local authorities to supply houses at affordable prices." - Mary Shaughnessy, South Dublin County Council.

“The world markets have been shaky, but if we can get over this year, things should improve. I think the level of enquiries and proposals we are receiving will bear this out. Leases in Ireland are traditionally long, and large projects take a lot of planning, so the future is about the fruition of these.” - Mike Kavanagh, MD, Structure Tone Ireland.

“A number of good investment opportunities may be put to the market over the coming months and this will undoubtedly test the strength of demand. The pace of transactional activity will, however, be dictated by the availability and cost of funding.” – CB Richard Ellis: Bi-monthly research report.

"We used to see quite a number of small syndicates, made up of a group of friends, that would club together and buy land. That market has gone. Really, unless you're an established player, it's extremely hard to get financing from the banks." - Donal Kellegher, director, Savills HOK.

"We have information at our disposal that enables us to forecast trends and make predictions for the short- to medium-term performance … It is remarkable that our 2006 census can tell us how many native Irish speakers live in Roscommon, what type of sewerage facilities are prevalent in Wicklow or what percentage of the population of Leitrim does voluntary work. But no one can find out how many unsold housing units are out there or how many more will be built this year." - Marie Hunt, head of research, CB Richard Ellis.

"The project represents a huge vote of confidence in Cork and the docklands and the inclusion of a conference/events centre with an audience capacity of over 5,000 people is very welcome - it's something the council has pursued and is contributing to its capital cost." – Joe Gavin, Cork city manager.