An Upscale Dorm for Adults

With reference to Co-living goes mainstream, but this is not roommate roulette by Diana Olick

A new housing trend called ‘co-living’ is an upgraded version of low cost living geared for young professionals. The concept of co-living works like a college dorm, complete strangers living in an apartment together with shared living spaces. The catch is every roommate has to sign their own lease so there is liability for their roommates.

The idea came from an increase of housing costs in Chicago and there was no place for two guys, Ryan Shear and Noah Gottlieb, to live so they created this new style targeted for the young professional. It gives another option for people moving to a new city who don’t want the liability of sharing a lease with a stranger but wants to meet new people. It comes with a bedroom and bathroom to yourself and a shared-furnished common area. There is also cleaning services that come and clean the common area.

Gottlieb found the demand to be stronger than expected in Chicago with average age of renters …

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The Specified Serious Illness Cover is Expanding to Better Cover

In reference to The Story of Specified Serious Illness Cover by Colette Houton.

Health insurance coverage is expanding its benefits to better cover individuals. This is to better adapt to the changing medical world. New policies you can look forward to is partial coverage for early-diagnosed cancer, expanding the amount of diseases covered, coverage for children from birth, and organ donor coverage.

The medical world is constantly improving with new technology and software to keep up with the new medical discoveries. The health insurance industry has to keep up with these changes. They recently have made some strides to better cover their clients. They did this because they know how relieving it is for a client when they know their disease is covered.

A new stride has been partial coverage for early detected cancer. Since new medical technology, cancer is diagnosed far earlier than when a client is entitled to the full claim. Even when it is discovered earlier many times people still have to go through extensive surgery and medical tests.  To help, the insurance industry, specifically Royal London’s …

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Tensions are High in the Mortgage Market

This post is in reference to It’s time to shout ‘stop’ on excessive charges by Brendan Burgess and Banks warned over cashback mortgage deals by Donal O’Donovan. Both published on June 16 2017 in the Independent.

Interest rates are high for non-tracker mortgages and banks are offering cashback deals to manipulate customers.

Everyone is accusing everyone today in the mortgage market in Ireland with interest rates the highest in the European Union. The Competition and Consumer Protections Commission (CCPC) have sat idly by for the past years as the interest rates are rising when the CCPC is designed and paid by the taxpayer to protect the consumers. CCPC came out with a report yesterday stating Ireland needs more competition, long-term strategy, vision and more committees. No suggestions in the report have a solution for the short-term.

The Government, Central Bank, and the CCPC wants everyone to be patient and the competition with drive down mortgage rate… but how long from now? Government and the Central Bank have been saying this for the past three years and nothing has changed.

Now …

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Karl Deeter Mentioned in the Press

You can find an article at this link which mentions Karl Deeter, apart of Irish Mortgage Brokers – Bank accused of ‘gouging’ loyal customers cuts its fixed rates on June 15 2017. Article by Charlie Weston in the Independent.

Permanent TSB, a state-rescued bank, has been increasingly cutting fixed rates in response to being accused of manipulating their clients. The bank has lowered it’s two-year fixed mortgages from 7.25% to 4.20% and three-year fixed mortgages from 8.75% to 4.20%. They have almost halved both of their fixed rate mortgages but the variable rate at the bank has remained the same.

The Central Bank has noticed an increase of fixed variable rates compared to variable for both new borrowers and existing ones. Therefore, banks have been reducing fixed rates to increase competition amongst other banks. This will prevent clients to switching to other banks for better deals.

The bank also extended a 2% cashback on all new mortgage drawdowns, supposed to end this month but got extended to the end of the year.

Karl Deeter was mentioned accusing the bank …

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Housing Prices are to Remain High in the Future

With reference to Housing Costs likely to remain elevated in Medium Term by Ali Uğur.

The housing costs look to remain elevated with no promise of decreasing throughout the rest of 2017. With increases in the average price of property at 10.7% from 2016 to February 2017 according to the CSO residential property price index.

Concerning rental properties, the rental inflation is 13.4% for the first quarter of 2017. This being the second highest level since 2002. This is in part from the supply and demand issue here in Ireland for rental property. The May 1st, 2017 there was fewer than 3,100 rental properties available to rent. This is the lowest on the record, according to the Daft.ie report.

Looking on the bright side, we are seeing an 18% yearly increase in completed residential properties with 14,932 completed in 2016. This is in response to trying to meet the increase of demand in the housing market. A majority of these, however, are one-time builds and can’t predict any yearly continuous builds. The breaking of grounds for new residential homes has …

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Mortgage Market Update

The Financial Broker gives readers an overview on currently property prices and mortgage market conditions.

The Central Statistics Office published a report showing price inflation on property had increased 10.7% in the past year up to February. A similar report reveal how the number of newly build housing last year was 14,932 units when estimates denote a demand of up to 50,000 units. These numbers illustrate a problem in the current mortgage market, which this article pinpoints the causes of. The author laments about rising property prices, arguing that many potential home buyers have missed out on the prime time to purchase property, and are currently no long capable of affording the housing of their choice at an acceptable price.

The author attributes the current housing price and rent inflation in Ireland as consequences of a lack of supply in urban areas instead of lax macro-prudential regulations. In fact, she argues that current Central Bank regulations are too restrictive, and thus have prevented demanders from being able to locate and buy affordable housing. While the prudential regulations have lowered the …

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More scandals from Wells Fargo: extending mortgages without customer knowledge

A series of new legal allegations have been bought against the bank, once again regarding its improper handling of customer accounts. This time, light has been shed on the company’s mortgage business, in which unauthorized changes were made to the loan terms on the mortgages of customers in bankruptcy.

 

Wells Fargo, a major American Bank headquartered in San Francisco, has been plagued by scandals and bad publicity in the past year. On September 8 of 2016, it was forced to pay $185 million in fines for its activities in opening more than 1.5 million bank accounts without its customers’ consent. The company’s culture demands its managers and employees to reach incredibly high quotas and targets, and directives stems from the very highest levels of management. CEO John Stumpf encouraged employees to create as many accounts from each customer as they possibly can, his infamously motto being “eight is great”.

 

Clearly, the bank still hasn’t learned from its past mistakes. New class action lawsuits filed by multiple …

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Highlights from the 2017 Macro-Financial Review

The Central Bank of Ireland published today it’s 2017 Macro-Financial Review. The report gives an overview of the Irish economy and the state of its financial environment. The aim of the report is to help protect the interests of the Bank’s stakeholders, these include: the Irish people, national and international authorities, and other participants in the financial market.

Sharon Donnery, the Central Bank’s deputy governor, introduced the report in a speech this morning. She states that the state of the general economy is improving, but also mentions a few outstanding issues that have the potential to negatively impact the economy’s improvement.

The report notes that much of the uncertainty in the Irish economy is a consequence of Brexit. The depreciation of the sterling against the euro and decreasing consumer spending in the UK has already put a burden on export industries. Uncertainties relating to Brexit may also arise from new trade barriers, trade policies and changes in international taxation.

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ECB Putting Pressure on Irish Banks?

European Central Bank is putting pressure on Ireland’s main banks to deal with the non-performing mortgages on their books. The banks are coming up with ways to remove these non-performing loans off their balance sheets. Considering the possibility of special purpose vehicles (SPV) that package all of the non-performing loans. They will need to sell the majority of the stake of the SPV to investors for them to remove it from their books. By creating SPVs, banks will still be able to service and have a stake in the mortgages. They are starting to create leads on investors currently.

With the ECB already overseeing a lot of the main banks in Ireland in the end of 2014, they have cut their average of 27% of non-performing loans off their balance sheet in 2013 to 14% at the end of 2016.

In the recent years, US private equity firms have refinanced millions of non-performing loans from Irish lenders. Showing a demand for such bonds because of the great success of residential mortgage backed securitisation. The banks will need to structure any …

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A response to: Housing for homes – a classic case of market failure

A recent blog post published by Tom Healy, director of the Nevin Economic Research Institute, suggested that the current housing market in Ireland is an example of a failed market. Healy believes that the issue of under supply of housing can only be solved if the government expands provisions of social housing and extends its jurisdictions over prices and supply in the housing market.

Healy based his argument upon the assumption that the current housing market has failed and is unable to recover without intervention. He cites a chronic under supply of housing and the inability of government programs to sufficiently meet demand. While there is indeed a under supply of housing and rising prices due to pent up demand, a series of government construction plans such as the 2013 Forfas Strategy, Capital Investment Plan, and Action Plan for Housing and the Homeless, in addition to private investments are expected to dramatically increase housing supply within the next few years. These projects directly address the supply issue by promising 47,000 additional units of social housing before 2021.

The blog post …

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