There’s another group deserving of a redress

AFTER years of foot-dragging on the issue, the Government has suddenly agreed to fund repairs to defective apartments built during the Celtic Tiger era.

At the stroke of a pen, it turns out that exposing taxpayers to an unquantifiable bill is no longer a major cause of concern, with €1.5billion to €2.5billion set aside for the purpose.

The news must be a massive relief to people who signed up for inflated mortgages for what they thought were prime properties, but which they discovered later were falling apart at the seams.

In the heady, gold-rush atmosphere of the so-called boom years, the usual checks and balances were often abandoned by all sides. Surveyors’ reports may have been bypassed so buyers had genuinely no idea they had bought a fire hazard or that their new home was built on dodgy foundations.

Infinitely more culpable are the rogue builders who took advantage of the lax inspection regime to flout regulations governing building standards.

The repair scheme gives respite to buyers who were badly burned by the wild west atmosphere, where banks threw money at customers, no questions asked, and housing developments seemed to mushroom overnight.

EVEN those who have already carried out their own remedial works will be compensated retrospectively. Much like the energy credit scheme, ability to pay is not a factor, with the Government keen to make sure that everyone gets a slice of the taxpayer-funded action.

But while the Government might congratulate itself on its largesse, it seems to have forgotten another category of homeowner who was undone during the Celtic Tiger, and who arguably is entitled to compensation in this era of loose purse strings.

I’m not talking about the flash Harrys who used the banks’ loose lending criteria to buy trophy homes in the early noughties on the strength of massive mortgages which, short of winning the Lotto, they could never hope to repay.

Or about those who gambled on ever-increasing property values to get rich quick, or became smalltime speculators, flipping properties as soon as it was auspicious.

I’m talking about people who never partied – those who purchased ordinary family homes at grossly inflated prices, sucked into the prevailing propaganda about how if they didn’t get their foot on the property ladder in jig time, they would surely be priced out of the market forever.

Saddled with Celtic Tiger mortgages, on 25- or 30-year terms, these poor saps also shelled out record amounts of money on stamp duty so that the State’s coffers overflowed with cash.

After the property bubble burst and their homes toppled into negative equity, they were then subjected to the new 2013 property tax, part of a suite of austerity measures designed to replenish State coffers, and which treated their property as an asset rather than the liability it had become.

On top of that, they suffered most from the tracker mortgage scandal, which directly caused the loss of 315 homes and buy-to-let properties due to repossessions.

But these are mere blips compared to the mountainous legacy created by reckless government policy, constructed on the pipe dream of everspiralling house prices.

Long-term negative equity and enormous pressure from mortgage debt or arrears have blighted thousands of lives since the crash, turning householders into mortgage prisoners.

While their troubles initially attracted attention and calls for a proper insolvency system, it has fallen off the political agenda.

Last year, the Central Bank reported that more than 46,000 house mortgages are in arrears – and close to 6,000 of them for more than ten years.

The data also shows that half of mortgage accounts in long-term arrears made no repayments at all in the past two years. Granted, some of these are strategic defaulters, and those who are clinging on in the false belief that family homes are safe from repossession by banks and vulture funds.

The majority, however, are blameless – guilty of nothing more than trying to put a roof over their families’ heads when the market was gravely overheated – and who have been suffering for their bad timing ever since.

According to David Hall, CEO of the Irish Mortgage Holders Association, the figures for arrears will only increase as interest rates soar and the cost-ofliving crisis bites even harder.

It is also likely that homeowners who, pushed to the pin of their collar, had their mortgages restructured over the last decade, will be unable to withstand the interest rate increases and that the almost 6,000 live repossession cases currently in the courts system will become a tsunami.

‘While it may not have fully arrived, nobody sensible could conclude that from 46,000 mortgages in serious arrears, and 6,000 legal cases, there isn’t going to be a very serious problem.

‘Indeed, the vista has become worse as the people ten years in default are now ten years older, with significantly less road ahead to make payments,’ says Hall.

If the ghost of mortgage arrears and repossessions is about to be resurrected, inflicting more stress on those who already suffered from banks and vulture funds during the crash, the possibility of throwing them a lifeline should surely assume some urgency.

With a €2.5billion fund for repairing Tiger-era apartments, the Government can hardly plead poverty or indeed a reluctance to absolve homeowners of their personal or financial responsibilities.

Indeed, now that it the Government is in election mode, courting the goodwill and gratitude of another tranche of the electorate might even be expedient.