We got this email in from a would-be property buyer, frustrated with the Dublin market and this frustration is not helped by media commentary or recent talk of a bubble. We would love to get other people’s opinion on it. Please note that we are sharing this not because we agree with all of the points made, but rather because it would appear to echo the thoughts of many. What do you think..?
A lot has been written about recent property price increases, in both the rental and purchase sectors with commentary on the causes, cures, and possible interventions to prevent another property bubble. The minister for finance we are told had instigated an investigation to determine if any government action is deemed necessary. The only area of agreement is that, with little or no mortgages being completed, the increase is being fueled by cash buyers. The glaringly obvious question as to who these cash buyers might be is universally overlooked.
The current austerity program following the bank collapse, while keeping the major banks afloat, protects only one species, bondholders and senior bondholders. Government and mainstream media would have us believe this species is of the “flying pig” variety whose identity must be guarded, less we suspect those in our community and environs still displaying obvious signs of abundance.
The difficulty for this species of bondholders, now that their wealth is still intact, is what to do with their wealth to get a reasonable and safe return. Investing in banks or financial institutions is hardly a sensible option. Deposits are attracting historically low interest coupled to punitive tax rates. International markets are still volatile and awaiting stability.
Property, on the other hand, is currently available at some 50% of it’s peak value in our major city. Rents are spiraling giving an immediate yield while awaiting further capital appreciation. It would appear to be a viable option.
Could it be that our “protected species” are currently fueling the increases and creating a double whammy of putting property beyond those that are paying for it and need it most?
So let’s recap, we have an austerity program, funded by the least well off, protecting the wealthy, and putting basic necessities beyond those who are paying for it.
Government policy seems to dictate rather than trying to find a solution you just find a historical reason why you are helpless.
We have been stabbed by our protected species, who are now turning the knife.”