Brexit’s Largest Impact

Uncertainty is the overwhelming feeling that Brexit has brought onto the entirety of the EU. Here in Ireland, we are no exception. The fear of a large economic downturn is looming, and it seems everyone is fixated on what will happen when October 31st comes around.

The Irish economy as a whole was predicted to grow 4.1% in 2019 and forecasted an increase in the GDP of 3.7% in 2020 according to the European Commission. This however was predicted without considering the effect of a hard exit by the UK. A hard exit could bring an economic fall out consisting of lowered income levels, and higher unemployment rates. Experts from the Economic and Social Research Institute suggest that these conditions can lower the intense growth of property prices since the low in 2013. The Central Statistics Office says this growth has been just over 86% within those 6 years. Housing demand is likely to lower, affecting mortgage companies, brokers, and families trying to sell or relocate.

However, the housing industry will likely not be the hardest hit industry from the …

Read More

Some information about Frankfurt in Germany

Frankfurt is the 5th biggest city in Germany, it is in Hessen and more than 750.000 people are living there. Between 2008 and 2018 about 100.000 new people were coming to live in this big city.In Frankfurt there are many banks, the ECB (European Central Bank) and the stock exchange, so this city is considered as financial capital from Germany.

The demand for real estate in Frankfurt is bigger than the offer, so the prices for rental rise. In Frankfurt the prices are one of the highest in whole Germany, just Munich has higher prices.

The current average price per square meter for an apartment in Frankfurt today is 17,87 €/m². To rent a flat or a house you must lock a rental contract. These contracts are usually closed for one or two years. In 2018 for an apartment up to 40 square meters you had to pay about 17,90 €/m² , for up to 80 square meters about 13,10 €/m² and for up to 120 square meters about 13,50 €/m² . But the price for an apartment depends on …

Read More

Brexit slows hiring

Brexit. Are you tired of this word yet? It is all that seems to be on the news, on your local newspaper headlines, and on any form of social media platform you can think of. If it seems to be encroaching on every aspect of your life, that is most likely because it is. 

Although a nuisance, it is not without good reason that this topic is everywhere. However far in the future this EU split may be, there are plenty of precautions being taken here and now that must be taken note of by economists and citizens alike. 

As of late, there have been significant changes in the job market for some particular hiring sectors. An index by IrishJobs.ie notes that in the three months preceding July, there was a 4pc decrease in job postings as a hiring sector wide statistic. 

Some of the largest reductions in possible hirings come from firms that are operating in the accounting, financial services, and pharma sector. These three all have come to the conclusion that their particular category may be more hardly …

Read More

Bank of Ireland’s Marketing Gimmick

Recently, the Bank of Ireland has been accused of a marketing gimmick. The Bank of Ireland has launched a new mortgage product that does not offer cash back. The bank has maintained a high market share. Bank of Ireland has been offering up to 3% in cash back of the value of the mortgage taken out. However, the Bank does not have the lowest rates in the market.

Cash back can be defined as money back from a mortgage. For example, if an individual borrows €200,000 he or she may get back €6,000. The first 2% of cash back is paid at the time the mortgage is taken out. The other 1% is paid at the end of year five.

However, the bank has now introduced a High Value Mortgage Interest Rate with no cash back. The new mortgage product is the first fixed rate product without cash back that the Bank of Ireland has one since the introduction of cash back in 2014.

The High Value Mortgage Interest Rate only applies to people borrowing more than €400,000. The product is also …

Read More

Mm Capital propose building university dorm copycat in Dublin 1

With housing options becoming more and more difficult to secure for an affordable price in Dublin, many people wonder when the ever-expanding city will reach maximum capacity. With the thought of growth being stagnated by the availability of homes or apartments at a reasonable price point on the brain, Mm Capital began looking for answers. 

In partnership with international shared residential operator SQRE Living, Mm Capital composed and submitted a building proposal that would allow them to build a 132-bed co-living development on a 5000 square meter plot. This residential building would be located at 39-42 Hill Street in Dublin 1. 

Although this sounds to be an outrageous propositions, students all across Europe and the United States live in these type of conditions for 2-4 years of their lives while attending university. Many of the dorms strewn across campuses can house hundreds of students easily and effectively. 

This real estate investment and development firm has also mentioned many different styles of living that would be available. Around 75pc of the 132 rooms would be 19 square meters, while the other …

Read More

Brexits impact on Insolvencies

The date in which the UK is due to leave European Union is quickly approaching. Less than 100 days remain until Brexit is likely to occur. David Van Dessel, a partner at the consulting  group Deloitte, stated that if the UK ends up crashing out of the EU without a deal it could have a “material impact” on company bankruptcy levels throughout Ireland.

According to Deloitte, the impact of a hard Brexit on Irish businesses may not be apparent until the next year. In other words, the material impact will be more likely to be a depicted in 2020 insolvency statistics.

Van Dessel also discussed how directors are veery slow to ask for external assistance when their business is in the midst of financial troubles, especially family businesses. Family companies tend to deal with issues more privately. Generally, when a company is in trouble the common approach is to sell more, but the problem is normally much greater than lagging sales.

For companies directly effected by Brexit, the financial impact may be quick after implementation, but there will be a …

Read More

Brexit and Help-to-Buy Scheme Provide Uncertainty

Boris Johnson has recently been elected Prime Minister and uncertainties surrounding Brexit are back on the minds of Irish people. The likelihood of there being a no-deal Brexit is strong and the Irish housing market needs to be ready for the consequences. Also, the uncertainty surrounding whether the help-to-buy scheme will be continued or not will have a strong effect on the housing market. The Irish housing market for the rest of this year will depend strongly on the outcomes of the two events listed above.

Lisney published a report recently focusing on the upward trend in the Cork house and construction sectors. Lisney cited Brexit and help-to-buy scheme as two possibilities that may negatively affect the Cork market. Lisney investigated 41 new home schemes being constructed in the Cork area which totals 2,640 units. The help-to-buy scheme is what’s keeping first time buyers able to purchase a home and if this is taken away the number of people seeking homes will decrease. New home sales contribute to approximately 15% of sales in Cork over the last couple of quarters …

Read More

Cuckoo Funds Shifting Buyers towards Renting

Long-term pension funds are at risk with the aging population and increases in the rental market. The aging population is going to dry up pension funds because there will not be enough younger people to payoff older generations pension funds. Additionally, the expanding rental market will cause long-term retirees having trouble sustaining a comfortable lifestyle. Renting can be a great solution in the short term if someone is young, temporary, etc. However, not owning a home and having your mortgage paid off when you reach retirement ages can cause a lot of stress.

Cuckoo funds are contributing to this problem by spending approximately €2 billion on buying thousands of apartments and still have about €6 billion left to invest in the housing market according to global real estate advisor CBRE. Many consider Dublin to be one of Europe’s top markets for large, global funds to invest in.

There has been a dramatic shift from investing in Ireland’s commercial to residential property. In the first half of 2019, about 40% of commercial property investment is now being used for the residential …

Read More

New rent laws

Holiday homeowners must now have planning permission to rent out their property to tourists or stays ip to two weeks. This new rule are in effect as the start of July, 2019. The new rental law only applies to properties in a rent-pressure zone (RPZ). An RPZ is a zone where rent is typically above the national average.

This summer could mark the last summer that holiday home owners in the RPZs will be able to rent out their properties to tourists. Property owners will be breaking the rules if they continue to rent their homes out to tourists unless they are granted the planning permission to do so. Failing to get planning permission for renting to tourist can result in fines up to  €5,000 or six months of imprisonment – or both.

Homes that are not effected by the rental restrictions can be defined as homes which were purposely designed, constructed and approved to be dedicated to tourism accommodation.

According to Jacinta Doolan, the founder of Trident Holiday Homes, about 80% of holiday homes throughout Ireland do not have planning …

Read More

Mortgages on the rise

A sense of impending doom has been a huge part of economic and political decisions within the last few months due to the ever uncertain Brexit debacle. These feelings are slowly beginning to fade in Ireland due to the increased time that Irish businesses and banks have had to prepare for the EU split. Although this event is bound to cause slight fluctuations, economists have noted that the economic future for Ireland is still bright. 

Banks and buyers alike are taking note of this promise, which has been obvious through the most recent data in relation to mortgage approvals and house prices. According to recent bank data, there has been a  significant rise in the number of home related mortgage applications and acceptances. 

The Irish Bank and Payment Federation found that from April to June, there were 10,157 mortgages taken out, which is an 8.8pc rise from the previous period. Using yearly comparisons, it has been shown that the issued mortgage rate this time last year was around 800 acceptances lower. It topped the approvals for the first three months …

Read More