We must help peo­ple es­cape in­vest­ment prop­erty trap

The Irish Mail on Sunday - - COMMENT -

THE news re­ports show­ing peo­ple camp­ing out to buy houses, in the man­ner of crazed bar­gain hun­ters in the Christ­mas sales is alarm­ingly rem­i­nis­cent of the Celtic Tiger era. That af­ford­able fam­ily homes are now out of the reach of cou­ples earn­ing a com­bined in­come of €92,000 is a be­wil­der­ing echo of Enda Kenny’s boom­time com­plaint about how a mar­ried cou­ple, a nurse and garda, didn’t stand a chance of get­ting onto the prop­erty lad­der.

How did we get into this pickle again?

This time out though, the prop­erty scene is a tale of two gen­er­a­tions; the young who once again, can’t get started and the mid­dle-aged who of­ten have more than the fam­ily home in their pos­ses­sion. A legacy of the crash and its re­cov­ery is the num­ber of mid­dle-in­come wage earn­ers with an in­vest­ment prop­erty un­der their belt. I have friends who be­came ac­ci­den­tal land­lords be­cause they couldn’t off­load their apart­ments when they traded up due to neg­a­tive eq­uity.

And I know peo­ple who took ad­van­tage of in­cen­tives in­tro­duced by Michael Noo­nan, pic­tured, to kick­start the mar­ket dur­ing the crash.

In many ways, Fine Gael cre­ated the con­di­tions for this rot to set in, and while re­me­dial ac­tion may in­volve us­ing State-owned land for build­ing or com­pelling de­vel­op­ers to get crack­ing on their projects, rather than wait in­def­i­nitely for land val­ues to soar higher, there is also a case for en­cour­ag­ing the ‘neg­a­tive eq­uity gen­er­a­tion’ to sell the apart­ments and small houses they have out­grown and which are now gain­ing value.

It may not make eco­nomic sense to sell an as­set, par­tic­u­larly one that has caused its owner anx­i­ety, but not ev­ery­one is cut out for deal­ing with ten­ants.

A scheme that made sell­ing worth their while might free up hous­ing stock for the next round of buy­ers.

Newspapers in English

Newspapers from Ireland

© PressReader. All rights reserved.