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Shotoflight

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  1. Junction One shopping centre value falls 90% in five years http://www.bbc.co.uk/news/uk-northern-ireland-26944506 The Junction One shopping centre near Antrim is now worth less than 10% of what it was valued at in 2009. The details are contained in the latest accounts of Junction One Ltd, which cover the 18 months to March 2013. They show that the centre is now valued at £7.85m, compared to a valuation of almost £80m in 2009. Virtually all commercial properties in Northern Ireland have seen their values fall as a result of the property crash. The latest fall in the value of the centre follows a revaluation in May 2013 that saw a chartered surveyor reduce the value from £30.3m to £7.85m. Junction One Ltd has Ulster Bank borrowings of more than £48m and its liabilities outweigh its assets by almost £52m. Junction One Ltd is partially under the control of an administrator after one of the company's shareholders was placed into administration last year. Valto Ltd went into administration in October as part of a restructuring of property assets controlled by brothers Shamus and Francis Jennings. Company documents suggest that Valto has 50% of the shares in Junction One Ltd.
  2. Former solicitor jailed for €8.8m land purchase fraud http://www.rte.ie/news/2014/0407/607248-solicitor-jailed-for-land-purchase-fraud/ A former solicitor has been jailed for two years for his role in an €8.8 million land purchase fraud. His client has been given a two-and-a-half year suspended sentence. John Duffy, 44, from Clogheen, Monasterevin in Co Kildare and his client Tony McAuliffe, 71, from French Furze, Co Kildare pleaded guilty to dishonestly obtaining a loan of the money from Investec Bank with the intention of making a gain in March 2007. The land was to be sold on for €17m but the property business collapsed and the money could not be repaid. The 55 acres in Co Offaly are now worth just €35,000. Judge Leonie Reynolds criticised Investec saying if it had carried out the most rudimentary checks the fraud would have been exposed. She also said the deal was indicative of the lax lending practices of the banking sector at the time. The case has been described as a lesson the country has learned in the madness of "get rich quick" before the property bubble burst. McAuliffe is functionally illiterate but his solicitor Duffy created and prepared the contract as well as a letter saying he had a deposit of €7m, money he never had. They stood to make a profit of €9m. Instead they lost the €9m they borrowed to buy land. Judge Reynolds described Duffy's actions as an unacceptable abuse of his position as a solicitor and sentenced him to three years in prison, suspending the final year. However, because of McAuliffe's exceptional personal circumstances she said she was taking the unusual step in such a case of suspending his two-and-a-half-year sentence.
  3. House prices up 5.4% in year... but they're still half of peak value http://www.belfasttelegraph.co.uk/news/local-national/northern-ireland/house-prices-up-54-in-year-but-theyre-still-half-of-peak-value-30150666.html Property in Northern Ireland remains around half of its 2007 value, despite a 5.4% price hike over the last year, a new survey has found. Nationwide, the building society, also claimed that the local market recorded the second weakest annual growth across all UK regions. Despite that, the data – which puts average house prices here at almost £115,000 – shows that the local housing market is slowly improving. The survey also suggests a modest increase in house sales and prices which corroborates the findings of a number of reports published recently. Other experts have expressed different views regarding house prices, with averages ranging from just under £99,000 to £135,000.
  4. FCA: Credit cards can encourage excessive debts UK http://www.bbc.co.uk/news/business-26867309 The FCA said nine million Britons were considered to be in serious debt, with so-called "survival-borrowers" using credit cards or payday loans to help pay bills. Mr Wheatley said that around one million of the the UK's 30 million cardholders only made minimum payments, so making little impact on the overall debt. "We know it's not uncommon for the most 'at risk households' to hold multiple cards and revolve multiple balances month-by-month," he said. On average such people have debts of £27,000 each.
  5. Bank of Ireland to pay stamp duty for first-time buyers Experts say move has echoes of boom time lending and incentives http://www.independent.ie/business/personal-finance/bank-of-ireland-to-pay-stamp-duty-for-firsttime-buyers-30148751.html
  6. Real wages fall 7.6% in six years, with construction workers most affected Construction staff faced real hourly wage cuts of 13.4% between first quarter of 2008 and fourth quarter of 2013, says ONS http://www.theguardian.com/uk-news/2014/apr/02/real-wages-fall-76-per-cent-six-years-construction
  7. Northern Ireland economy is vulnerable in long-term http://www.belfasttelegraph.co.uk/business/opinion/john-simpson/northern-ireland-economy-is-vulnerable-in-longterm-30141675.html Increasingly, Northern Ireland is looking more dependent on a low-pay environment, rather than a higher value added gear change. There is now official evidence of the impact of the recent experience on the various regions of the UK. It makes uncomfortable reading for two regions: Northern Ireland and Yorkshire with Humberside. The Office for National Statistics has published details of the way each of the UK regions has performed. The differential impact of the years of recession is unexpected and disappointing. In statistical terms, if the overall average for the UK is indexed at 100, each region has been compared to that baseline of 100 in each year. If a region's performance is less than 100 that shows the basic disadvantage of lower average incomes for people in that region. The significance of the divergence is both as a measure of different average incomes but also, year by year, of how the differences are changing. There is little surprise in the starting point in 2007. Northern Ireland has, for many years, lived with an average income gap of about 18%, or, using the UK index of 100, Northern Ireland would be expected to be about 82. Over this recent six-year period, when Northern Ireland's GVA per hour worked has fallen, Northern Ireland experienced a more stable labour market than some of these comparator regions. Whilst GVA has fallen, relative to the UK, employment here has increased by just short of 2%. The changes in the labour market in other regions show a fall in employment in Scotland and in the North East and a modest increase in employment in Wales. Not only has Northern Ireland's GVA per hour worked slipped behind the other normal comparator regions, but this has happened alongside a more favourable job market outcome. With more jobs, Northern Ireland has managed to produce, relatively, lower output per employee. This is not a confident assurance of improving competitiveness.
  8. House price rises a 'good thing' http://www.belfasttelegraph.co.uk/news/local-national/uk/house-price-rises-a-good-thing-30147120.html It is a "good thing" that property prices are rising, the housing minister has said. Kris Hopkins said he and other homeowners "expected" their values to increase. But he denied the Government was fuelling hikes with policies such as Help to Buy - and insisted more homes had to be built. Mr Hopkins was pressed repeatedly on the BBC's Newsnight to say whether or not sharp increases in the market were positive. "I think yeah," he told presenter Jeremy Paxman. "I bought a house and I expect the value to rise, and I'm sure you did as well." Mr Hopkins said rises were "certainly part of the market", but stressed that prices were still well below the pre-credit crunch highs. "We are nowhere near the peak at this moment in time," he added. The Tory MP argued that Help to Buy - which has seen the Government step in to underwrite deposits - only accounted for 0.5% of transactions in the last quarter of the year. But he accepted that the country was "woefully short" in terms of housing supply. "I don't agree with the fact that we are stoking demand, I certainly agree that we need more housing," he said.
  9. NI public spending £9bn higher than tax income in 2011/12 http://www.bbc.co.uk/news/uk-northern-ireland-26845607
  10. I see what you mean. Introducing inflation (RPI or otherwise) probably confuses matters. I would like to see a further steady fall of 5% per year for the next 3 yrs to settle at some sort of normality - irrespective of inflation. Wishful thinking perhaps. Who knows where wages, interest rates or further govt (of whatever make-up) interference will take us in 3 yrs. More happy clappy predictions (this one's a cracker!!) At last, Northern Ireland recovery is on the way http://www.belfasttelegraph.co.uk/business/news/at-last-northern-ireland-recovery-is-on-the-way-30138987.html The brightest economic outlook in years will prompt an increase in house prices in Northern Ireland by nearly 7% this year and the creation of over 13,000 jobs, an independent think-tank has predicted. The Northern Ireland Centre for Economic Policy (NICEP) said the recovery would continue into 2015, with house prices climbing a further 8.5% and the creation of 9,600 new jobs. "Home owners are also likely to enjoy rising property prices and we can say with confidence that the property market has finally turned the corner." THE FORECASTS Northern Ireland – Economic Forecasts: A House price increase B Economic growth 2014 A 6.7% B 2.8% 2015 A 8.5% B 2.9% 2016 A 8.4% B 2.6% 2017 A 8.0% B 1.8% 2018 A 7.0% B 1.5%
  11. You are right ; 4% YOY but zero last quarter. I know I'm splitting hairs clinging to RPI currently at 2.7% (possibly higher in NI?) and presumably higher for the previous 12 months (ie nudging the 4% house rise) but by escape velocity I mean strong sustained price growth above inflation. The rate of 3 to 4% is too fast.
  12. Households saving less for a rainy day http://www.bbc.co.uk/news/business-26795178 Households saved a smaller share of their income last year than in 2012, according to the latest figures from the Office for National Statistics (ONS). In 2013 people saved 5.1% of their disposable income. This compares with a figure of 7.3% in the previous year. The fall in the country's savings ratio could suggest a return of confidence, as traditionally people save more when they're worried about their jobs. In 2007, before the financial crisis struck, savings were at little more than zero, but they rose to 9% during the recession. As the economy recovers, wage rises in key sectors such as retail and manufacturing are starting to outpace the rate of inflation. However, the fall in the amount of their income households are salting away, could show people are spending more just to maintain their standard of living. That last thing. Surprised it hasn't happened sooner nor been more severe. Would love to see NI figures. Also the wages/inflation thing is poisoined by now using CPI instead of RPI (and splitting wages by public/private then further down into service, manufacturing etc) RPI 2.7% currently
  13. Sudden rise in property prices stoke new fears of housing bubble http://www.independent.co.uk/news/uk/home-news/sudden-rise-in-property-prices-stoke-new-fears-of-housing-bubble-9215197.html But prices in Northern Ireland are still 49 per cent below their pre-crisis high, reflecting the property bubble that engulfed the region in the last decade. A 1% rise in the past year (RPPI) does not suggest "escape velocity" - just yet! Not sure what fundamentals will come along, or are already out there, to change this position - in the short to medium term. Except, of course, peoples' greed and stupidity which is always lurking, and we have often seen exposed. Then, of course, it is everybody elses fault and individual responsibility is a dirty concept. Admittedly, people are bombarded with a lot of B/S from a variety of sources and 'nudged' via the media and Govt policy. Have any lessons been learned?
  14. First-time mortgages in Northern Ireland are UK's cheapest http://www.belfasttelegraph.co.uk/news/local-national/northern-ireland/firsttime-mortgages-in-northern-ireland-are-uks-cheapest-30133579.html First-time buyers in Northern Ireland pay less for properties than in any other region of the UK, new data has revealed. Average deposits and mortgages are also considerably lower than elsewhere, according to figures from LSL Property Services.
  15. UK consumers in '£5bn black hole' of hidden debt Demos report finds debts amounting to £200 per household are made up of unpaid rent, council tax and utility bills http://www.theguardian.com/money/2014/mar/27/uk-consumers-5bn-hidden-debt UK consumers are struggling with almost £5bn of hidden debt, made up of rent arrears, and unpaid council tax and household bills, according to a report by thinktank Demos. In a report entitled The Borrowers, the organisation said the sum, which equates to almost £200 a household, has been ignored by official debt figures, despite including the type of borrowing that was most likely to be detrimental to consumers. Demos has created a "harm index" which ranks the impact of different types of debt according to their financial, emotional and social consequences, based on the experiences of people who have encountered each type of borrowing. While mortgages tend to be a consumer's largest debt, and borrowing amounts to more than £1tn across the UK, Demos gave it a harm rating of just 23 out of 100. By contrast, the types of debt people felt had the worst impact included payday loans, which scored 68 out of 100, council tax arrears, 62, utility bills, 57, and doorstep lending, 50.
  16. Belfast Met Titanic Quarter campus: The £211m college that should have cost £44m Gamble on rising (commercial) property prices fails spectacularly - at taxpayers expense. How many more???? http://www.belfasttelegraph.co.uk/news/local-national/northern-ireland/belfast-met-titanic-quarter-campus-the-211m-college-that-should-have-cost-44m-30121876.html In early drafts of the deal, the ownership of the Brunswick Street and College Square East properties would have been transferred to ICL when the Titanic site was completed. However, negotiations took place at a time when property prices were rising and, with planning approvals also approved for developing the two sites, their value soared, surging from £8.8m in 2005 to £22.5m by 2008. College bosses decided to change the deal and, two months after ICL was appointed the preferred bidder, it removed the transfer of the buildings, substituting them with a capital contribution of £15m. The college felt removing them from the deal was the best way of achieving open market value. However, the agreement meant the risk of movements in property values was transferred back to the public sector. DEL had agreed that, in the event of the sale not realising the full £20m, it would make up the shortfall. However, the value of these properties has fallen significantly and a large shortfall in the expected income is now likely. The Audit Office report said: "The sale of these assets will fall significantly short of covering the total £20m capital contributions made by the public sector." Belfast Met must also foot the cost of maintaining and securing the properties until they are sold. To date approximately £310,000 has been spent preparing the College Square East and Brunswick Street sites for disposal. The cost of maintaining and securing the sites since the Titanic Campus was opened in 2011 to last September was a further £770,000.
  17. UK house prices accelerate, ONS figures show http://www.bbc.co.uk/news/business-26730912 Annually, house prices grew by 7.1% in England, 6.9% in Wales, 1.4% in Scotland and 2.7% in Northern Ireland in January, the ONS said.
  18. Northern Ireland's poorest 'still struggle after downturn' http://www.bbc.co.uk/news/uk-northern-ireland-26721962 The poorest people in Northern Ireland are continuing to struggle after the economic downturn, two reports suggest. Research from the Nevin Economic Research Institute (NERI) uses official data to suggest that about one in six workers in NI are classed as low paid. A report from the Joseph Rowntree Foundation examined the pattern of falling incomes in the recession. It found that the typical household saw a 9% drop in income while the poorest households saw a 20% drop. The report says falling incomes were driven by an increase in youth unemployment and a rise in the number of people working fewer hours than they would like. It suggests that older people have been spared the worst effects of the economic downturn, with pensioner poverty rates falling during the years of recession. The report also cautions that poorer people could face further difficulties as a result of welfare reforms, many of which are still to be imposed. The NERI report addresses the persistent issue of low pay in Northern Ireland - the region consistently records the lowest rates of private sector pay of any part of UK. The report uses the EU-wide definition of low pay, which is two-thirds of the typical salary. On that basis 115,000 workers are classed as low paid. It also uses a second measure known as the Living Wage; an hourly wage that is assessed as giving workers a basic standard of living. In Northern Ireland it is assessed to be £7.45 an hour - well above the minimum wage - and about one in four NI workers earn less than that amount. NERI say that the large numbers of workers classed as low paid "raises serious doubts over the future economic prosperity" of Northern Ireland
  19. More than 17,000 purchase home under Help to Buy scheme http://www.bbc.co.uk/news/uk-26702179 Mr Cameron hailed the scheme, saying: "Help to Buy is a key part of our long-term economic plan, giving thousands more people the security and independence that comes from owning their own home."
  20. Building a better way of housing http://www.belfasttelegraph.co.uk/opinion/news-analysis/building-a-better-way-of-housing-30112700.html 22,000 households are in housing stress. Only 7,000 of the 11,000 homes we need annually are being built. 36% of young adults in Northern Ireland are still living with their parents – the highest rate in the UK. There are no quick fixes. However, with our Government partners, housing associations are leading efforts to provide more homes for people in need. Associations match Department for Social Development grants pound for pound with their own funds, doubling the number of homes that could otherwise be delivered. This year, 1,300 new social homes will be started and more than 1,000 first-time buyers will be helped by Co-Ownership. For 2014/15, the target for new social homes increases sharply from 1,300 to 2,000. Achieving this 50% increase is possible, but not without concerted action across the Northern Ireland Executive to unblock many barriers to delivery. Most urgent is a game-changer on land supply. Too many sites are still tied-up with the banks and Nama. Public bodies must do all they can to bring forward their unused land.
  21. Help to Buy 'mistaken' and 'dysfunctional' says Posen http://www.bbc.co.uk/news/business-26679739 Chancellor George Osborne considers the scheme to be of crucial help to house buyers, and also a means of stimulating the construction sector. But Mr Posen said: "I find this whole initiative largely mistaken by the Treasury." The first stage of Help to Buy was recently extended until 2020. "The idea of pumping up credit for middle to upper-middle class people to spend more on housing, when people have already spent too much on housing, is dysfunctional," Mr Posen told BBC Radio 5 live's Wake Up to Money programme.
  22. Northern Ireland's recovery lagging behind rest of UK http://www.belfasttelegraph.co.uk/business/news/northern-irelands-recovery-lagging-behind-rest-of-uk-30109408.html Angela McGowan, economist at Danske Bank, also pointed out that long-term unemployment rates of in Northern Ireland of 49% are well above the UK average of 35.6%, while full-time earnings here rose by only 0.5% in the year to April 2013 compared to a 2.2% increase in full-time earnings across the UK during the same period.
  23. Families can't take more cuts http://www.belfasttelegraph.co.uk/opinion/news-analysis/families-cant-take-more-cuts-30109559.html New jobs are being created in sectors such as retail, hotels and catering to offset some of the job losses. But, they tend to be relatively low-paid. And there are not enough of them to provide jobs and apprenticeships for the large numbers of young unemployed. We need a further boost to infrastructure spending, in particular house-building, to kickstart construction and speed up job creation. As public spending is squeezed, the health service is close to meltdown, while teachers' unions complain of "under-resourcing and neglect" of the north's most vulnerable children in our schools. Finance Minister Simon Hamilton tells us austerity will get worse, with an additional £300m in cuts to the public spending budget by 2015/16. Add to that the frightening cost to the economy of welfare reform.
  24. Revenue collects €1.5m in property tax each day http://www.independent.ie/business/personal-finance/revenue-collects-15m-in-property-tax-each-day-30109144.html THE Revenue Commissioner has collected almost €1.5m a day in household charges after it threatened to haul homeowners before the courts for not paying up before the end of the month. The surge in payments follows Revenue's warning that it would impose tough penalties and interest and pursue enforcement action on property owners refusing to pay by the March 31 deadline. Property owners continuing to defy the demand from the taxman may even receive a call from the sheriff, and tax clearance certificates could also be refused. There are a still around 260,000 homeowners facing sanctions or possible prosecution if they do not meet the looming cut-off date. The spokeswoman said around 12,000 mandatory deductions have been taken from people's pensions and pay packets, and there has been more than 3,000 tax clearance refusals for homeowners refusing to cough up. Revenue also intends to punish people who have undervalued their properties or claimed exemptions from the tax they are not entitled to. In two weeks' time, Revenue will begin adding further penalties and interest to the tax owed by those refusing to pay the charge. Enforcement action could ultimately follow and property owners face a visit from the sheriff or further legal action.
  25. John Moran: Top civil servant questions our obsession with home ownership Calls for thorough debate on future of housing in Ireland http://www.independent.ie/business/personal-finance/john-moran-top-civil-servant-questions-our-obsession-with-home-ownership-30109146.html Speaking at a property conference in Dublin, he said it was time for in-depth discussions on whether it was necessary for everyone to live in a "three-bedroom house" when more and more people were committing to renting long-term. "There may be a need to address fully the idea of everyone needing a three-bedroom house in Dublin and if that is the right way to go about planning long-term. "That could raise a scenario, which I wouldn't like to get into, of a Los Angeles-type sprawl of Dublin with three-bedroom houses all the way out to Kildare and surrounding counties while the city centre gets hollowed out again even as the overall population grows," he warned. The number of households renting is now higher than at any point over the past four decades, having risen steadily since 2000. The civil servant explained that the arrival of overseas investors and new investment tools had "professionalised" the rental market in such a way as to make renting for the long-term a viable option. Up to now the rental market was very fragmented but that was changing – the change was giving tenants security in the long term, he said. "That change on its own alters the role of the banks because then fewer mortgages are needed," he added. Mr Moran also predicted that as the banks worked out the huge number of mortgages that were in arrears there would be a jump in the number of people for social housing. "You only have to look at the mortgage arrears numbers to know there is a pent-up demand for it (social housing) and as the mortgage backlog is worked through there is an inevitability that some of those people will end up on the social housing register and add to the 100,000 already there."
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