Sorry, I'm struggling to see the correlation between property and bank shares? You'd be getting exposure alright, but only to the downside. How would a rise in property values result in a higher share price for banks?
I discussed it here three years ago
https://www.askaboutmoney.com/threa...your-deposit-money-a-residential-reit.186486/
I haven't watched their performance, but I have been told that the iRES has not done as well as Irish residential property prices.
Brendan
Not over the last 3 years anyhow...id have thought there was a considerable chance of bank shares rising in conjunction with property prices ( i may be wrong on that one however )
Just wondering whats best way of getting exposure to irish property market without actually buying a property.
Not over the last 3 years anyhow...
There is a good possibility of bank shares rising as the economy grows in general (bigger market, fewer bad debts), but I can't see a direct link back to mirroring the property market. If a bank has lent X billion to mortgage holders / property investors at X % margin, it doesn't make a difference to the banks profit if the underlying property doubles in value - they don't share in that rise.
The vulture funds on the other hand should see a bigger correlation as their recovery on non performing loans will be tied to the underlying property values.
i am aware how bank of ireland has done since 2014 but its been heavily shorted , its far cheaper than AIB for example
surely a stronger property market reflects well on the banks loan book ?
I think there has been alot of negativity with regard to all european banks, they are still not regarded as a respectable investment. I think the comparison with the original big tech companies is valid , they recovered some lost ground after the dot com bust but then remained in the doldrums for years before starting to perform strongly again a few years ago when the dot com collapse was forgotten about.
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