Brendan Burgess
Founder
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So we have mortgage arrears, which international observers such as the International Monetary Fund and others can only scratch their heads at. We have more loans in arrears than the Russian federation, with its population of more than 140 million, and more than Spain, where the population is nearly 10 times ours and unemployment is more than double our own. Yet we have virtually no repossessions.
This means incumbents remain perpetually incumbent, helping to repair banks’ and individuals’ balance sheets, while ensuring Nama’s property portfolio grows in value.
The losers in this are more diffuse and have no lobby group serving their interests. We see first-time buyers priced out. How is that fair, when someone living on the street they want to buy on is years in arrears and is allowed to stay put?
But just of half of those who are three months or more in arrears kept to the revised payment deal offered by their bank, the report says.
And one in 10 troubled mortgage holders made no repayments after their mortgage was restructured, the economic report, entitled ‘Mortgage Repayments After Permanent Modification’, found.
as the value of the asset increases to the point where the banks will make their money back by repossessing and selling it, i think we will see more and more repossessions. It made no sense to crystallize a loss before. But now that property prices are rising, properties in arrears are becoming worth moving on.
Let's hope that happens!
Not clear if you mean repossessions or house price increases.
Then I agree with you, though I'm not convinced repossessions will happen. An article in todays IT, based on a CB report, suggests that a significant fraction of mortgages in arrears have defaulted a second time after being modified to supposedly make them sustainable. The number of repossessions and voluntary surrenders has increased but is still at a comparative trickle. I suspect the banks are still desperately trying to avoid crystallising losses.Repossessions. I agree that house price increases would be/are a disaster.
Then I agree with you, though I'm not convinced repossessions will happen. An article in todays IT, based on a CB report, suggests that a significant fraction of mortgages in arrears have defaulted a second time after being modified to supposedly make them sustainable. The number of repossessions and voluntary surrenders has increased but is still at a comparative trickle. I suspect the banks are still desperately trying to avoid crystallising losses.
The solution is to swamp the market with supply. To do this we need to make the right to build on land you own implicit. Countries such as Germany, which have this in their constitution, have better outcomes. If a person wants to stop you building on your own land, then they should either buy it themselves or suffer the economic consequences of that decision some other way.
There is only one way to stop or greatly reduce property bubbles and that is to stop encouraging people from buying property.
In Ireland, you better believe it!They can't do that forever.....or is social housing now a right of the middle classes as well
I would agree with you if rental yields were low, but they're not. Rents are high (in Dublin at least), prices are rocketing off the back of that and it has to be down to supply.
Would an Irish government have the will to take such steps, would they have the support of the people??? I doubt it.
- A deposit of 30% was required and this had to come from regular savings (not a gift from granny)
- 75% of the mortgage must be paid back by the time one reaches 60
About 18 months ago there was all the indications of a bubble starting to develop here in Switzerland and the government moved very quickly to put a stop to it:
- A deposit of 30% was required and this had to come from regular savings (not a gift from granny)
- 75% of the mortgage must be paid back by the time one reaches 60
- Pension funds can not be used as collateral
- Monthly repayments not to exceed 20% of monthly income
- Very limited tax relief
That put a stop to it.
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