Vultures are a key part of our housing recovery

When we hear talk of ‘vultures’ and ‘vulture funds’ it’s usually in highly negative overtones. That’s why the name-calling exists in the first place, the idea is to imply you have these groups that feed off the dead bodies of an innocent party.

Put this aside and realize that even if a company does feed off the assets of a failed one, that it doesn’t mean the firm that failed was somehow an innocent bystander. Usually they lost their market share and assets as a result of their own decisions and by definition a liquidator would sell these on to somebody.

Whether that ‘somebody’ is a person, fund or regular company hardly matters. What does matter is that we have a housing crisis and that these same ‘vultures’ will likely be delivering about 75% or more of private new housing in Dublin where the problems are most pronounced.

Take a look at some of the numbers in new developments: * Lone Star own 600 acres of land in Dublin with the potential for 7,000 homes: in Adamstown, where it has …

Read More

Every which way but loose. The economy speaks….

The Irish economy is in a downturn, if you don’t know this then you have already died and either gone to heaven (where the boom is still on) or to hell (in which you are living halfway through 2009 already).

The factors involved in the Irish economic slowdown are multi-faceted, on one hand there was the property boom, then there was the corresponding financial expansion, as well as a strong dosage of greed thrown in by Joe Public. All of this was the foundation for the explosive cocktail we will one day look back upon and refer to as the ‘credit crunch’.

Mortgages are harder to place with lenders, the lenders themselves don’t have the liquidity to keep giving out money, that is the downside of fractional reserve banking. Yesterdays ESRI report showed that property, construction, and lending are all down at serious lows for the same period last year. The forecast for 2007 was to see total lending rise by €25 billion, figures for the first quarter show that only 4.4 billion was drawn, assuming the slow down continues …

Read More