Media articles from THE REPUBLIC OF IRELAND

[Shotoflight]

Central Bank: House prices will fall this year but improve by end 2015

http://www.independent.ie/business/irish/central-bank-house-prices-will-fall-this-year-but-improve-by-end-2015-29288234.html

A new report from the Central Bank says house prices will fall this year, but will have increased modestly by the end of 2015.

Prices have already been in free fall for six years.

The Central Bank cares about house prices because they see falling values as one reason for the rise in mortgage arrears.

Now for the first time the bank has surveyed 200 economists, surveyors, stock brokers and estate agents for their view on the property market.

Even the estate agents say prices have further to fall nationally this year. The survey gives no breakdown by region, so it is not clear whether the experts think the Dublin region will escape the latest drops.

The main reasons experts gave for further price falls are difficulty getting mortgages, the potential impact of any increase in repossessions, the scrapping of the mortgage interest relief tax break and the introduction of the property tax.

[paul65]

Very sad news Namawinelake is no more

https://namawinelake.wordpress.com/2013/05/19/farewell-from-nwl/

Sad news indeed. I wonder did a NI solicitors start the closure ball rolling?

http://namawinelake.wordpress.com/2013/05/05/how-paul-tweeds-johnsons-solicitors-are-trying-to-muzzle-the-namawinelake-blog/

http://namawinelake.wordpress.com/2013/05/01/neil-adair-clarification-and-apology/

[2buyornot2buy]

It really is sad, great blog. A little bit less transparency for public.

[BelfastVI]

Sorry to see it go. I believe it may have had more to do with leaked information from NAMA that was passed to Winelake re a RoI loan book

[okaycuckoo]

Sorry to see it go. I believe it may have had more to do with leaked information from NAMA that was passed to Winelake re a RoI loan book

I think that was the injuction, which applied to others too. But he did put out misleading info (quickly corrected) on a bank executive which led to a solicitor's defamation letter. I'm sure he'll be fine, but it was probably the last straw.

[Shotoflight]

Fewer than 175 people have been able to get a new negative equity mortgage

http://www.independent.ie/business/irish/fewer-than-175-people-have-been-able-to-get-a-new-negative-equity-mortgage-29297084.html

Negative-equity mortgages let you sell your home and carry over whatever debt is left on a previous mortgage on to a new loan.

"It's hard to get approval for a mortgage if you're in negative equity," said Trevor Grant, chairman of the Association of Expert Mortgage Advisors. "For an awful lot of people looking to trade up, to be able to move, these people have to carry any shortfall from the sale of their existing home. This means they have to qualify for that shortfall – as well as the new mortgage.

"In our experience, borrowers are usually apartment owners who are looking to purchase a family home – so the negative-equity carry can be quite large."

When contacted by the Sunday Independent last week, AIB, Bank of Ireland, Danske Bank and Permanent TSB would not disclose the number of negative-equity mortgages they had approved.

"We have always said that we only expected negative-equity mortgages to be done on a very limited basis," said a spokesman for Permanent TSB.

Although negative-equity mortgages were initially only available to people who were not in mortgage arrears, some banks started to offer these mortgages to people in arrears last November – as long as the homeowner traded down.

However, only six homeowners in financial difficulty have managed to get negative-equity trade-down mortgages, according to the latest figures from the Central Bank.

The Central Bank warned last week that it could be late 2015 before property prices started to recover.

Property prices have fallen by more than 50 per cent over the last six years.

[Shotoflight]

PAYE home-tax dodgers first to be tackled

Up to 500,000 have yet to register as deadline looms

http://www.independent.ie/business/irish/paye-hometax-dodgers-first-to-be-tackled-29298279.html

Revenue confirmed to the Irish Independent yesterday that PAYE workers would be first in the firing line. And the taxman plans to force PAYE workers evading the property tax to cough up within weeks.

The tax authorities will begin deducting the property tax from PAYE workers' pay cheques in July.

Next in the firing line will be people receiving occupational pensions, followed by social welfare recipients.

The self-employed will be hit once they file annual returns in October and a surcharge could be applied.

Additional staff are working on the Revenue website to ensure it doesn't crash and a helpline will be open for extended hours today and tomorrow.

[Shotoflight]

Database will help flush out 32,000 rogue landlords - 10%

http://www.independent.ie/irish-news/database-will-help-flush-out-32000-rogue-landlords-29298283.html

THE property tax database is going to be used to chase down almost 32,000 rogue landlords who have previously escaped detection.

Their identities are being revealed due to the fact that their tenants are contacting the Revenue to tell them that they are not the owners of the house. Under the law, all landlords are required to have registered with the Private Residential Tenancies Board.

The Government is now going to change the law so that the Revenue can pass on the names and addresses of landlords identified by tenants to the Private Residential Tenancies Board (PRTB).

They are now facing the prospect of fines of up to €4,000 or six months in jail if they are found not to have fulfilled their obligation to register.

And they also face the prospect of a Revenue tax audit to discover if they have been avoiding paying tax on their rental income. Junior Minister for Housing Jan O'Sullivan said she would be bringing through legislation to allow the PRTB to get information from the Revenue's property tax database.

"The vast majority of landlords are compliant but the small 'rogue' element need to wake up to the fact that non-compliance won't be tolerated and they will face the music," she said.

According to the PRTB, there were 308,750 households living in private rental accommodation in the 2011 Census. But it currently has 277,000 tenancies registered – meaning that there are up to 31,750 landlords who have not signed up.

[2buyornot2buy]

I see Lagansider has left us.

Sorry to see you go.

[Shotoflight]

Six held in Cork in alleged mortgage scheme fraud

http://www.rte.ie/news/2013/0529/453448-cork-mortgage-garda/

Four men and two women are being questioned in connection with an alleged mortgage scam believed to involve funds of close to €1 million. All six were arrested at locations in Cork city and county.

They are being held at Garda stations at Gurranebraher and the Bridewell in Cork city, and at Mallow, Midleton and Kanturk. They can be detained for up to seven days.

The arrests follow an investigation, which has been ongoing for a number of months, and is headed up by fraud squad officers based at the Garda Regional Headquarters at Anglesea Street in Cork. The investigation began following complaints from financial institutions in relation to mortgages which were not being serviced.

It is alleged that false documents were used to secure these mortgages, and that the people in whose names the mortgages were sought may not be the people who received the funding. It is understood that some of the mortgages were serviced for a time, but that substantial six-figure sums remain outstanding.

Around ten properties are involved, most of which are in Cork city and county, but some are located in other parts of the country.

[Shotoflight]

House prices here have fallen too far, OECD claims

http://www.independent.ie/business/personal-finance/property-mortgages/house-prices-here-have-fallen-too-far-oecd-claims-29324269.html

Economist with Goodbody Stockbrokers Dermot O'Leary said prices have fallen so much that residential property was now good value.

Based on an average wage of €36,000 it now took around 4.5 times that wage to buy a typical house.

And he added that there were more housing transactions going on than were being recorded by the CSO as its index does not include cash sales. Up to half of sales are for cash at present.

Last month's reduction in rates saw 375,000 homeowners with trackers having their repayments cut. In the case of a €200,000 mortgage, repayments were cut by €30 a month.

But rather than pass the interest rate cut to variable rate customers, hikes in variables by EBS, AIB and Haven take effect from this week. And last week Danske Bank said it was putting up its variable rate by up to 1pc.

Other lenders have failed to pass on May's ECB cut to homeowners with variables.

Edited June 6, 2013 by Shotoflight

[Shotoflight]

Ouch!

€20m shopping centre under hammer for €225,000

http://www.independent.ie/business/commercial-property/20m-shopping-centre-under-hammer-for-225000-29334553.html

[Shotoflight]

Credit unions warned many loans will not be paid back

http://www.independent.ie/business/personal-finance/property-mortgages/credit-unions-warned-many-loans-will-not-be-paid-back-29337885.html

CREDIT unions have been warned that many of the loans they have given to those who are now in trouble with their mortgages will not get repaid.

The regulator for the sector also said that one in five credit union loans were in arrears.

Sharon Donnery, the Central Bank official who is registrar for credit unions, told managers of the lending co-ops to improve how they run their organisations.

New rules were being introduced for credit unions and regulators would also have new powers to force the lenders to operate to higher standards, she said.

Ms Donnery told hundreds of managers of credit unions not to assume that their loans would continue to be repaid, even if repayments were being met at the moment.

Many cash-strapped consumers are known to be making payments to the credit union, even though they cannot make payments on mortgages, car loans and credit cards.

People were reluctant to default on a credit union loan in case they close off their last line of credit, experts said.

[Shotoflight]

Mortgage arrears to rise for another year

Rating agency predicts problem will peak in 2014

http://www.independent.ie/business/personal-finance/property-mortgages/mortgage-arrears-to-rise-for-another-year-29334548.html

THE number of people in mortgage arrears will keep rising this year and will not peak until next year, a new report from rating agency Fitch has predicted.

The agency said that the numbers falling behind on their mortgages at AIB and Bank of Ireland have slowed down.

But the overall level of arrears will keep rising until some time next year, Fitch said in a new report on Irish banks.

Some 126,500 residential mortgage accounts are in some form of arrears, according to Central Bank information.

And a new survey has found that most people in mortgage distress have repayments so high they represent a third or more of their after-tax income.

Paying more than a third of your income on a mortgage is considered to be too high by experts, and likely to lead to financial problems.

People do not trust banks to offer them one of the new personal insolvency options that would see some debt written off, a new survey of people in mortgage trouble has revealed.

More than seven out of 10 people who responded said their mortgage repayments represent 35pc or more of their after-tax income.

The survey, commissioned by insolvency service Neo Financial in Dublin, was conducted among people who had downloaded a guide to the new personal insolvency regime.

[Shotoflight]

Fitch praises new law that gives banks power to repossess homes

Rating agency sees draft bill as a way of targeting so-called 'strategic' defaulters

http://www.independent.ie/business/irish/fitch-praises-new-law-that-gives-banks-power-to-repossess-homes-29346102.html

It suggests the rating agency sees so-called "strategic defaults", where people who can repay their debt opt not to in the hope of a debt write-off down the line, as a significant factor in the record high rates of arrears.

"The authorities have made it clear that large-scale debt relief will not be forthcoming, and the new bill supports this," Fitch said.

The planned legal changes will give back to banks the power to recover debt through repossession and will help resolve some long-term mortgage arrears, the agency added.

Fitch says that would be good for the banks.

ARREARS

The agency thinks repossessions rates will rise from the low level of just one out of every 300 homes in deep arrears recorded last year, according to IMF statistics.

However, the rate of foreclosure may be slow at first, it said.

That's because banks that want to repossess a property from a defaulting borrower will have to start what will still be a lengthy legal process from scratch if they want to take an action under the planned new laws

It will take time to clear the backlog that has built up of cases that were previously taken and adjourned, a situation that may raise the costs involved, the agency said.

Fitch said the introduction of the personal insolvency regime would also affect the rate of repossessions, but does not think it will be widely used by borrowers because of the power that banks have to block debt deals under the new system.

The new laws on repossession are due to come into force between now and the end of September. It will end the period of uncertainty for banks that have struggled to repossess houses since the so-called Dunne judgment in 2011, which found a technical flaw in the old legal regime that blocked repossession in almost all cases.

[Shotoflight]

Banks set to take trackers off struggling borrowers

http://www.independent.ie/business/personal-finance/latest-news/banks-set-to-take-trackers-off-struggling-borrowers-29355458.html

THE Central Bank is to give banks the power, for the first time, to take tracker mortgages off struggling householders.

However, heavy restrictions are to be placed on the new ability of lenders to strip homeowners of the low-cost mortgage rate.

The decision is expected to affect thousands of borrowers. A majority of the 23,500 mortgages in arrears of two years or more are considered candidates for debt write-downs.

Around half of these distressed mortgages are on tracker rates.

Other changes to the code to be announced next week include removing the restrictions on lenders making just three unsolicited calls a month to those in arrears, and allowing banks to move to repossess homes of people who are regarded as unco-operative.

The EU Commission has welcomed these changes but warned there could still be "undue incentives" for mortgage holders to stop paying even though they can afford to.

"Even after the planned reforms of the legal framework for repossessions and of the code of conduct on mortgage arrears, undue incentives may remain for strategic non-payment/default," the commission said in a new review.

[Shotoflight]

'Truly shocking' as one in four now unable to pay their mortgage

http://www.independent.ie/irish-news/truly-shocking-as-one-in-four-now-unable-to-pay-their-mortgage-29364027.html

THE full extent of the mortgage crisis can be revealed today as new figures show that one in four homeowners is struggling with their repayments.

The startling extent of the arrears timebomb emerged in an analysis of statistics released by the Central Bank.

It shows that arrears are still rising. More than 26,000 households have made no payments on their mortgages for two years.

Fianna Fail has accused the Government of sitting on its hands for years and handing banks too much power to repossess homes.

The stark figures for the first three months of the year show that close to 100,000 households are now three months or more in arrears.

Overall, one in four homeowners is now in a mortgage mess. This is made up of 142,000 mortgage accounts in some form of arrears and another 42,000 which are paying less than the full monthly amount. There is a total of 774,000 mortgages in the State.

There has also been a sharp rise in the number of buy-to-let mortgages that are in trouble. More than a third of investors are failing to meet their full monthly payments.

[Shotoflight]

Westlife star's €1.3m bakery now worth a lot less dough

http://www.independent.ie/woman/celeb-news/westlife-stars-13m-bakery-now-worth-a-lot-less-dough-29364374.html

The Westlife star's property company, Shaflin Developments, took out a loan of €1.3m from Bank of Ireland to buy the old Garvey's bakery in Ballina, Co Mayo, in December 2007.

They had ambitious plans to build a three-storey retail unit on the O'Rahilly Street site, hoping to attract some big label names to the town.

However, five years later, no work had begun and initial planning permission ran out last month. The unit is boarded up, and has been the subject of complaints by local residents because of its condition.

As part of his bankruptcy petition lodged earlier this year, the singer valued the property at €200,000.

However, receivers who now have control of the property are trying to sell it for €80,000.

[carrick01]

Anglo Bank fiasco

Really do need a few people made accountable. Listen to the tapes to find out the kind of people running these banks.

http://www.independent.ie/business/irish/abuse-the-bank-guarantee-dont-get-caught-david-drumm-29369275.html

"ANGLO Irish Bank boss David Drumm laughed about "abusing" the bank guarantee and warned his executives not to be caught abusing it, the Anglo Tapes reveal.

Drumm is also heard giggling as one of his executives sings the German national anthem as deposits from Germany flow into Anglo as a result of the bank guarantee.

It's the first time the former Anglo chief executive is brought directly into the controversy.

His language and casual attitude to the crisis will be found extraordinary by readers.

The latest revelations from the Irish Independent's 'Inside Anglo' investigation display a casual, even reckless, attitude at the bank during the financial crash.

Mr Drumm can be heard laughing at the financial regulator's concerns about being seen internationally to be "abusing" the bank guarantee in late 2008.

"We won't do anything blatant, but . . . we have to get the money in . . . get the f***in' money in, get it in," he tells his senior manager, John Bowe.

At the time, European leaders including Germany's Angela Merkel and UK chancellor Alistair Darling were alarmed at how the guarantee could affect their banking systems.

But Mr Bowe sang a "comedy" version of the anthem 'Deutschland Uber Alles' and talked about giving "two fingers" to British concern.

Mr Drumm and Mr Bowe are heard laughing at the concerns that the movement of money was causing a rift between Ireland and its EU partners.

Drumm declares to his colleague: "So f***in' what. Just take it anyway . . . stick the fingers up."

In an earlier recording, Mr Bowe laughed with another colleague, Peter Fitzgerald, about nationalisation of the bank.

They described the prospect as "fantastic" – so that they could keep their jobs and become civil servants.

This is the second tranche of conversations to be published by the Irish Independent, revealing an astonishing banking culture in the collapse of late 2008.

Yesterday, we revealed how Anglo executives who negotiated with the Central Bank lied about the true extent of losses at the institution in the hope the State would write them an open cheque.

The publication of the Anglo Tapes sparked fresh calls for a comprehensive banking inquiry across the political spectrum."

[Txomin]

Owner who sold land for €3m buys it back for €215k

http://www.independent.ie/irish-news/owner-who-sold-land-for-3m-buys-it-back-for-215k-29379229.html

[Shotoflight]

Property prices down 1.1% in the year to May - CSO

http://www.rte.ie/news/business/2013/0628/459414-property-prices-down-1-1-in-the-year-to-may-cso/

anecdotal evidence suggests consumer confidence regarding the housing market still remains fragile, with the ending of mortgage interest relief and lack of credit availability depressing activity.

''It is difficult to make a call on the housing market at this stage. House prices were down 11.2% on average in 2012 and indeed have fallen on average in each year since 2007. The odds point to another drop in 2013, but our gut feeling is that the decline will be in low single digits and the smallest annual decrease in the past six years,'' the economist added.

Davy economist David McNamara said that constrained mortgage lending and an increased supply of repossessed homes mean the outlook for house prices is uncertain. However he added that improved affordability and rising rents may underpin house prices in future months.

[Shotoflight]

2,000 struggling householders a month seek help

Debt agency Mabs is swamped by requests for aid as the impact of mortgage crisis hits home

http://www.independent.ie/irish-news/2000-struggling-householders-a-month-seek-help-29436111.html

Figures obtained by the Sunday Independent reveal a disturbing rise in the number of cash-strapped people who can no longer afford to pay their bills.

Almost 10,000 people who are being crushed under the weight of a €250m debt mountain appealed to the Money Advice and Budgeting Service (Mabs) for help between January and May this year.

And the agency admits it is struggling to cope with the huge numbers seeking help.

there has been a massive jump in the number of homeowners who are struggling to pay off their debts.

In the past, people living in the private rented sector and in rented local authority housing made up the bulk of Mabs clients.

But now only 22 per cent of its clients rent houses and apartments privately, while just 15 per cent live in council accommodation.

"It's a sea change from the early days of Mabs and shows the impact of the mortgage crisis," said Tony McQuinn, chief executive of the Citizens Information Board, which administers Mabs for the Government. "That's the big change in the last five years."

Higher mortgages and negative equity account for most of the cases involving young married couples with dependent children.

Banks and financial institutions are owed just shy of 76 per cent of the €250m owed by the agency's 2013 clients.

This clearly suggests that paying off the mortgage is the major problem for citizens caught in the debt spiral.

[BelfastVI]

Ulster Bank have offered long-term deals to 20pc of those in distress.

My link

Under intense pressure from the Central Bank, Permanent TSB – the biggest lender during the boom – is offering to reduce monthly repayments on the mortgages of up to 1,500 homeowners who are struggling financially.

So far, 1,000 homeowners have accepted the offer.

And Ulster Bank has said it had already hit its target imposed by the Central Bank to have offered long-term deals to 20pc of those in distress.

Six banks had until yesterday to report to the Regulator on their progress in offering sustainable solutions to those in mortgage trouble.

The Central Bank has threatened to impose financial penalties on the six banks if they do not meet the targets.

Now evidence has started to emerge of banks beginning to tackle the crisis that has seen almost 100,000 homeowners get behind on their repayments.

Up to now, struggling homeowners have mainly been offered short-term fixes, such as being allowed to pay interest only for a couple of months.

There has been no serious attempt to offer longer-term deals.

Banks have been holding back from tackling the chronic mortgage crisis over fears they will encourage people who can afford to meet their payments to "try it on" and seek a deal.

They also fear they will run out of capital and that many of the deals offered to those in deep financial distress will involve writing off debt.

Finance Minister Michael Noonan has confirmed that the state-rescued Permanent TSB has offered to split the mortgages of hundreds of homeowners in trouble.

Other lenders have begun to offer split mortgages to those who can't meet their monthly payments. It is an option favoured by the Central Bank for solving the mortgage mess.

A split mortgage is where the borrower pays capital and interest on part of the loan, with the rest put to one side.

In most cases, no repayments are made on the part of the mortgage that is put to one side.

Permanent TSB had been charging interest of 1pc on the portion that is "warehoused" but has since changed its policy and no longer charges interest on the part of the mortgage that has been frozen.

A split mortgage that is designed like this can dramatically reduce monthly repayments.

If someone with a split mortgage still owes money on the warehoused part at the end of the term of the loan, some banks may be willing to write off this amount if the consumers' circumstances have not improved.

Mr Noonan confirmed that around 1,000 of the Permanent TSB customers who were offered a split mortgage had accepted the deal. If they stick to the newly agreed repayments for six months, the bank will confirm the agreement.

The move by Permanent TSB is part of a plan to meet strict targets, imposed by the Central Bank, for dealing with mortgage-holders in arrears.

SILENCE

Six of the leading domestic banks have to offer one-fifth of their customers who are in arrears a "sustainable" long-term solution to resolve their mortgage difficulties.

AIB, Bank of Ireland, Permanent TSB, KBC Bank, ACC and Ulster Bank were due to have offered 20pc of those in arrears a long-term repayment plan by the end of last month.

Ulster Bank said earlier this month it had reached its target.

However, there are indications that other banks are struggling to meet their targets.

A number of banks contacted yesterday, including Permanent TSB, would not say if they had met the demands.

Director of the Irish Mortgage Holders Association David Hall said the banks would miss the targets.

"There seems to be a big problem and it is very concerning. There is a deafening silence from the banks."

A spokesman for the Central Bank said banks had 22 days from the end of June to report to regulators on whether or not they had met the mortgage-arrears resolution targets.

This meant banks were in the process of reporting to the Central Bank on the arrears issue.

Irish Independent

[2buyornot2buy]

I guess with the Dunn Ruling, lenders are limited in what they can do.

[BelfastVI]

I guess with the Dunn Ruling, lenders are limited in what they can do.

It perhaps always had to happen, its the moral hazard that is the problem.

Not that banks have any morals, but this has to have a devastating effect on those who bought within their means or made the life style changes/sacrifices to ensure they could repay their mortgages.