DECLG has ‘No Clue’ on housing alludes DIT Housing Lecturer

Lorcan Sirr, a housing lecturer at Dublin Institute of Technology in Bolton Street has been very critical of the Department of Environment on their approach to housing and recently wrote a piece about it on the Building Regs blog.

This considers things like the Building Control Regulations, planning regulations and Part V contributions. His closing line says it all “It’s quite difficult to engineer a situation in housing where everybody loses, but in the last 24 months the Department has managed to do that, repeatedly“.

To us this really says it all, everybody is losing in housing other than the people who already own houses and that was never meant to be how the housing market worked.

Read More

Newstalk: Pat Kenny & Karl Deeter discuss ‘rent certainty’ and construction

Pat Kenny had Karl Deeter of Irish Mortgage Brokers on his show to discuss ‘rent certainty’ and some aspects of construction as well as why they are both concerns for the Irish housing market.

The issues are important for both sides, prices affect different sides of a contract differently and large swings can be damaging to one or the other of them. The answer in Karl’s view is longer leases which requires no legal changes, but this is not being discussed.

 

Read More

RTE Today with Sean O’Rourke: Karl Deeter & Ronan Lyons debate mortgage caps

This is a copy of a good debate that took place on the Sean O’Rourke show today on RTE Radio. It was a good example of how two contrary points can both have supporting arguments which seek different ends but where both sides have validity. We think that a return to bubble credit would be a disaster, but equally hold dear the idea that it isn’t up to Central Banks to orchestrate the winners and losers in society.

Read More

RTE Drivetime: ‘Talking Money’ to buy or not to buy a property?

This week on RTE Radio 1’s ‘Drivetime’ our regular Monday edition of ‘Talking Money’ covered the issue of buying a home. Many first time buyers are starting to feel pushed into the home buyer cohort when they have other options such as renting or buying in a cheaper area, this can make a huge difference and we outlined some of the costs and concerns.

Read More

Boom or bubble and will it bust or burst?

This is a piece that Karl wrote for the Irish Sun, it relates to a piece that was the lead story for the paper last week.

(Begins)

There is a lot of talk that we have a ‘property bubble forming’, with virtually no supply, a growing population and a trend towards smaller households as things like separation and divorce become more common, it simply lacks ‘bubble’ qualifications.

But it does have ‘boom’ written all over it, we have had many such booms and busts in Irish history, I have spent much of the last two years researching just this very thing with Frank Quinn from Blackrock College of Further Education.

We have had many price rises and falls in the last 300 years, often we saw that after a crash the next boom would result in overcrowding because back then, as now, supply became ‘short’ in the areas that it was needed.

A boom is about rapid price appreciation, it doesn’t mean you have a bubble. You could have the price of anything boom and there wouldn’t be a bubble, …

Read More

Newstalk Lunchtime – priced out of housing?

We spoke to Jonathan Healy on Newstalk’s ‘Lunchtime’ about the issue of rising house prices and how the solution is more supply, at least relative to many other commonly prescribed fixes.

We also discussed the idea of there being a fee for making a bid on a property as well.

Read More

Midlands Radio: Will Faulkener talks to Karl Deeter on Government mortgages

Will Faulkner spoke to Karl Deeter about the proposed government plan on 95% mortgages.

The idea of getting more people credit in an easier fashion in order to afford more homes is questionable. A good analogy is if it was decided that the Leaving Cert should be marked easier in order to help more people get into college.

What would likely happen is that the limited college places would still be taken up but that the points required for any one course would go up, it doesn’t resolve any shortage of college spaces (for instance), and in this respect more credit will probably do the same to housing, it won’t fix anything other than if by ‘fix’ you mean ‘make prices rise’.

Read More

Just repossess stuff, there are REIT’s and Social Housing folks who want them

There is a message coming from two sectors who have a housing demand that isn’t discussed when it comes to the finger pointing game, but who, by rights should get a mention.

The most recent one is mentioned in Construction 2020. Under the heading ‘Social Housing’ on page 14 it talks about how social housing is important then says this ‘It is estimated that in the region of 5,000 new Social Housing units will be provided in 2014 through leasing and existing capital programmes. This includes completion of mortgage-to-rent arrangements’.

Translation: repossessed houses will help create social housing supply. It won’t add supply, it will just re-profile properties from one classification into another meaning the list length stays about the same for these properties. This merely lets people who borrowed leap frog the 90,000+ people in the queue ahead of them into getting a home (which used to be theirs) reclassified into social housing.

The ‘Mortgage to Rent‘ scheme came from the inter-departmental group …

Read More

Today with Sean O’Rourke: Some of the problems with the Property Market

We were asked to discuss some of the problems in the property market with Sean O’Rourke and Philip Farrell of Real Estate Alliance.

There are issues such as gazumping with other bidders, gazumping where there are no other bidders, under-pricing to increase interest and timed viewings which create an ‘auction type environment’.

It is incredibly difficult for estate agents to manoeuvre their way through this without upsetting somebody (and it can’t be the vendor who is their ultimate client). This is why we should consider some small rules where people get punished for anti-market behaviour such as the vendor having to pay a buyer a certain sum if they pull out after the contract is signed.

This isn’t going to stymie anybody, remember, it is only after the booking deposit is paid, accepted, and the contract sent out, signed and returned that this could happen.

An unintended consequence may mean that contracts don’t get sent out very easily in the future, but can we believe that people would avoid getting contracts sent out? That’s unlikely, some kind of structural change …

Read More

Six One News looks at the problem of Rent Receivers

Rent receivers are generally sent in when a landlord is unable to meet the terms of their contract. It doesn’t mean they can’t pay anything (although often insolvency is behind it), sometimes the landlord is on an ‘interest only’ term that reverts to capital and interest and the uplift in cost means there is no way they can meet the increased commitment.

The issue is also more common in properties with equity because the bank don’t stand to suffer a loss in that position (they do in properties with negative equity), it’s also used as a more coercive approach to borrowers who want to hold on to trackers, as ‘interest only’ is often extended for people willing to forgo that aspect of their contract.

Unbalanced taxation on property is also a concern, the ability to tax a cash flow loss on residential property makes it a difficult trade off of ‘who shall we upset’ the choice being the bank or Revenue (most opt for the former).

 

Read More