We must help people escape investment property trap
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.